In a socialist economic system, the government

owns and controls many of the resources.

Income distribution refers to

the way all of a country’s income is divided among groups of earners.

Which of the following can not be attributed to Adam Smith’s beliefs?

All value in produced goods comes from labor.

Globalization leads to

closer connections between countries through trade.

that people’s actions are led by “an invisible hand.”

work done for a company by people who live in other countries.

Globalization began to occur

in the mid-1800s to the late 1920s.

Resources are owned and controlled by private individuals in what type of economic system?

a free enterprise or market economic system

Which of the following is not a result of globalization?

Countries tend to associate politically & economically w/ their “own kind"

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Chapter 2: Economic Systems

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Questions 25

Answers

1
Globalization has
expanded everyone’s ability to potentially sell to more people.
raised prices for consumers.
reduced the variety of products available in the world.
decreased people’s ability to communicate.
2
The major differences between free enterprise and socialism include
All of these.
ownership of resources and the government’s role in the economy.
controlling prices and honoring private property.
economic planning and income distribution.
3
With globalization, the world is moving toward
one large economy.
10 major economies.
three powerful economies.
50 dominant economies.
4
A command economy is
like capitalism.
run by individuals and businesses.
a particular type of socialist economic system.
not concerned by the three economic questions.
5
In a socialist economic system, the government
owns and controls many of the resources.
pays little attention to income distribution.
rents resources to the people.
owns and controls the people.
6
Income distribution refers to
average income per person in a country.
earnings of corporations in a country.
the way all of a country’s income is divided among groups of earners.
welfare payments made to the poor within a country.
7
The question of what goods will be produced must be answered because
command economies need to write a plan.
scarcity exists.
consumers would like to have these goods.
some countries are poor and must choose what to produce.
8
The three economic questions are What goods will be produced? How will the goods be produced? and For whom will the good
True
False
9
Which of the following can not be attributed to Adam Smith’s beliefs?
Self-interest causes people to work hard and take risks, which benefits soc
All value in produced goods comes from labor.
The division of labor creates greater productivity and wealth.
Government should provide national defense, a system of justice, and public
10
Globalization leads to
increased tension between foreign countries.
closer connections between countries through trade.
spread of socialism in the world.
increased interest rates.
11
Karl Marx is best known for writing
Globalization Facts.
Das Kapital.
War and Peace.
The Wealth of Nations.
12
Adam Smith believed
that capitalists exploited workers.
in the labor theory of value.
that surplus value should go to the workers.
that people’s actions are led by “an invisible hand.”
13
Offshoring refers to
work done for a company by people other than the company’s employees.
work done by dock workers.
work done for a company by people who live in other countries.
work done by foreigners in their own country.
14
In socialism, government plays a large role in the economy.
True
False
15
Today in North Korea, the government owns almost all the resources in the country.
True
False
16
Globalization began to occur
in the mid-1800s to the late 1920s.
during the Great Depression.
two decades ago.
during World War I.
17
How a society answers the three economic questions defines
its income distribution.
its economic system.
whether it is a pure or mixed economy.
its place in the global economy.
18
Which of the following countries must decide what goods will be produced?
United States
China
All of them
Russia
19
The first economic question every society has to answer concerns what goods to produce.
False
True
20
Resources are owned and controlled by private individuals in what type of economic system?
a free enterprise or market economic system
a communist economic system
a traditional economic system
a socialist economic system
21
In decentralized socialism & communism many economic activities take place in the public sector as opposed to private
False
True
22
The two major economic systems are
free enterprise and socialism.
socialism and command.
communism and command.
free enterprise and capitalism.
23
Which of the following is not a result of globalization?
The world has become “smaller.”
Countries that never before communicated have become major trading partners
Individuals & businesses in any part of the world are affected by events.
Countries tend to associate politically & economically w/ their “own kind"
24
According to this textbook, there is a strong relationship between life expectancy and
outsourcing.
climate.
government control.
globalization.
25
Which of the following is not one of the three economic questions?
How will the goods be produced?
For whom will the goods be produced?
What goods will be produced?
How much will be produced?

Chapter 2: Economic Systems Flashcards | StudBud