Economic Systems Review

Which of the following is NOT characteristic of a centrally planned economy?

• Government owns all land and capital
• Government makes all economic decisions
• Each collective or factory sets its own goals
• Each person is assigned a job

What is the struggle among various producers for the consumer's business called?

• Socialism
• Competition
• Incentive
• Self-regulation

Why does even a free market need some government intervention?

• to provide for things that the marketplace does not address
• ensure the gov't has freedom to tax as necessary
• Make sure the gov't can fulfill its needs for military
• so the gov't has some control over factor resources

Which of the following is NOT a key economic question?

• What goods and services should be produced?
• How should these goods and services be produced?
• Who consumes these goods and services?
• How should it be ensured that goods/services are paid for?

What does the process of specialization do for an economy?

• It eliminates unemployment
• It makes it more efficient
• It fosters competition
• It makes it easier to control

How could the Chinese economy be characterized?

• Free Market
• Centrally Planned
• Mixed, but on the side of centrally planned
• Mixed, but on the side of free market

What is one of the most important advantages of a free market?

• It can change rapidly
• it protects the less fortunate
• It is easy to regulate
• It encourages growth

What incentive motivates a manufacturer to sell a product?

• Making profits on sales
• putting others out of business
• pleasing the consumer
• popularity of the product

Which of the following was a free market philosopher?

• Karl Marx
• Vladimir Lenin
• Adam Smith
• Friedrich Engels

Who wrote the Communist Manifesto?

• Karl Marx
• Adam Smith
• Ben Franklin
• Joseph Stalin