Understanding Economies and Economic Indicators

What is an economy primarily composed of?

• Goods and services

• Only services

• Only goods

• Money and currency

Which type of economy relies on supply and demand without government interference?

• Command economy

• Traditional economy

• Mixed economy

• Market economy

In a command economy, who controls the production and distribution of goods?

• The government

• International organizations

• Private companies

• Individual consumers

What does GDP stand for and what does it measure?

• Gross Domestic Product; measures the size and growth of an economy

• General Domestic Price; measures currency value

• General Domestic Product; measures inflation

• Gross Domestic Price; measures unemployment

Why is some level of inflation considered essential for an economy?

• It reduces the GDP

• It decreases the value of currency

• It increases unemployment

• It helps maintain demand and economic growth