In a laissez-faire economy,

producers/consumers are relatively free of govt intervention

What does the circular flow model illustrate?

It shows how money goods, & resources move in market economy

Why is competition important to a free enterprise system?

It results in more choices for consumers.

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Econ Lesson 1 2nd half Mrs R

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Answers

1
In a laissez-faire economy,
all economic planning is done by government committees.
govt regulations strictly control how goods r produced
a powerful ruler makes all production decisions
producers/consumers are relatively free of govt intervention
2
What does the circular flow model illustrate?
It explains the theory of the overthrow of capitalism
shows differences among traditional command market economies
It shows how money goods, & resources move in market economy
It depicts key characteristics of the US economic system.
3
Why is competition important to a free enterprise system?
It raises prices in the marketplace.
It limits the number of sellers in the market.
It results in more choices for consumers.
It results in higher costs to producers.
4
One of the most free economies in the world is
North Korea
Australia
Egypt
Egypt
5
Market systems cannot function without....
a legal system to enforce laws
a three branch government
your mom
equal distribution of resources
6
Economic goals of a modern command economy
Equity and security
wealth and stability
Efficiency and freedom
7
What encourages innovation by guaranteeing that inventors can profit from their work?
Intellectual property laws
Contract
Property rights
competition
8
The most significant driving force of the free enterprise system is
circular flow mode
profit motive
factor payment
public works
9
Because the industrial revolution increased inequity, __ was proposed as an alternative system.
Monarchy
Americanism
traditionalism
socialism
10
Which country is mostly free?
Hong Kong
North Korea
Australia
China
11
In a simplified market economy, what are the 2 kinds of participants?
Housholds and Individuals
Businesses and Housholds
Producers and Individuals
Firms and Households
12
Key features of a traditional economy
Government
Stability
Defense
Custom and tradition
13
What is the role of government in a mixed economy?
to provide public benefits that are too expensive 4 society
to establish the institutions that enable markets to operate
to regulate the market when it operates in unacceptable ways
all of the above
14
The governments role in a mixed economy is protection, regulation, and public benefits.
False
True
15
How many countries today have a pure market, command or traditional economy?
none
some
many
All
16
When Estonia transitioned from command to market economy, they focused on ...
changing the minds of the people
modern technology
not relying on foreign aid
all of the above

Econ Lesson 1 2nd half Mrs R Flashcards | StudBud