Economic Systems Quiz

What type of economic system does the United States have?

• Command economy

• Mixed economy

• Free enterprise system

• Socialist economy

In a free enterprise system, who decides what goods and services are created and sold?

• The government

• Large corporations

• The market based on people's needs and wants

• International trade agreements

Can anybody start their own business in a free enterprise system?

• Yes, anybody can start their own business

• No, only the government can

• No, starting a business is only for some people

• Yes, but only if they have a government permission

What does the price of a good or service depend on according to the text?

• The quality of the product

• The supply and demand

• The advertising budget

• The brand name

What happens to the price when the supply is high and the demand is low?

• The price goes up

• The price stays the same

• The price goes down

• The price is determined by the government

What is scarcity?

• When there is more supply than demand

• When there is more demand than supply

• When goods and services are abundant

• When the price of goods is very low

What is a surplus?

• When the demand is higher than the supply

• When the supply and demand are equal

• When the supply is higher than the demand

• When the price of goods is fixed

Which of the following is likely to happen in a situation of surplus?

• Consumers have a hard time making enough money

• Producers may have a hard time making enough money

• Prices of goods and services increase

• Scarcity becomes a bigger problem

What do families usually do when there is scarcity?

• They spend more money on luxury items

• They decide what they need most and choose how to spend their money

• They buy more goods and services than usual

• They ignore the scarcity and continue as normal

What is likely to happen to the cost of bananas in Florida due to the bad weather damaging most of the crop?

• The cost will decrease because there is a surplus of bananas.

• The cost will remain the same as it is not affected by weather.

• The cost will increase because there is a scarcity of bananas.

• The cost will decrease because the demand for bananas is low.