Ch.2 Econ Test Review

Focuses on wealth distribution

Consumers in command economies have an unlimited amount of all goods available to them.

An example of a public good, in an economic context, is

The main medium of exchange in the U.S. is

In a pure market economy, firms do not produce public goods because

Which of the following is a problem with pure command economies?

Most economies today are

Which factor might best help an economy grow?

The law of comparative advantage helps explain

In a market economy, what rights give resource owners the freedom to use their resources as they see fit?

Any movement along the PPF involves producing less of one good to produce more of the other.

Law of increasing opportunity cost each additional increment of 1 good requires econ to give up more of the other good

Being able to make something using fewer resources than other producers require would give you a(n)

Which of the following is NOT true of a pure market economy?

A classless society

A traditional economy is shaped largely by custom or religion.

An increase in the availability or quality of resources shifts the PPF inward.

An outward shift in the PPF reflects an economic downturn.

An economic system is the set of mechanisms that resolves the what, how, and for whom questions.

The economy of the U.S. can be described as a

Efficiency means producing the max. possible output from available resources

An economic system in which all resources are government owned and all production is directed by the central plans.

The U.S. is a mixed economy, but markets play a relatively large role.

Which type of economy produces the highest standard of living for its citizens?

China's economy is in the process of

In a pure market economy, market forces coordinate production as if by an "invisible hand."