24.3 - Economic Systems in Action

A key characteristic of capitalist economies is

• government regulation.

• control of markets by a single producer.

• private ownership.

• high taxation.

How does the socialist government of Venezuela pay for its social welfare programs?

• with very high individual taxes

• with revenues of publically owned industries

• by encouraging foreign investment in its industries

• by encouraging more free enterprise

What is the basic goal of socialist economies?

• to create a classless society

• to spread throughout the world

• to eventually evolve into capitalism

• to share wealth more equally in society

How does Sweden's form of mixed capitalism differ from that of the United States?

• Sweden provides more social welfare support.

• Businesses are more difficult to start in Sweden.

• Sweden regulates businesses more tightly.

• Swedes pay more for education and health care.

In a capitalist system, entrepreneurs are motivated to start new businesses by

• the thrill of taking risks.

• the allure of power.

• the potential to make a profit.

• the desire for stable employment.

Under capitalism, the allocation of goods and services is determined by

• businesses.

• the government.

• consumers.

• free market forces.

In what type of system do the people have no control over the economic decisions?

• mixed capitalism

• socialism

• mixed communism

• communism

Communism is an economic system in which

• elements of capitalism combine with elements of socialism.

• the central government directs all major economic decisions.

• a dictator controls all aspects of people's lives.

• a single religion guides all government decisions.

What is holding back China's transition to a free enterprise system?

• low wages of its workers

• few government incentives for foreign businesses to locate factories there

• lack of real political change

• high individual and corporate taxes

Since the collapse of the Soviet Union, Russian leaders have been attempting to build a

• free enterprise system.

• welfare state.

• pure communist economic system.

• pure socialist economic system.