Question 1

Which of the following statements is true ?

Accepted Answer

A)  The doctrine of laissez-faire advocates an economic system with extensive government intervention and little individual decision-making.
B)  In capitalism income is distributed on the basis of need.
C)  Adam Smith was the father of socialism.
D)  Most real-world economies are mixed economic systems.
E)  The "invisible hand" refers to government economic control.

Question 2

In Karl Marx's view, people under the ideal state of communism would be motivated by the principle "from each according to his ability, to each according to his enterprise."

Accepted Answer

A) True 
 B)False

Question 3

In Adam Smith's competitive market economy, the question of what goods to produce is determined by:

Accepted Answer

A)  the "invisible hand" of the price system.
B)  businesses.
C)  unions.
D)  the government, through laws and regulations.

Question 4

A traditional system solves basic economic questions by long-standing customs.

Accepted Answer

A) True 
 B)False

Question 5

Property rights allowing individuals to own goods, services, and factors of production are most important in:

Accepted Answer

A)  socialistic economies.
B)  planned economies.
C)  capitalistic economies.
D)  command economies.

Question 6

The economic system characterized by private ownership of resources and market is:

Accepted Answer

A)  capitalism.
B)  communism.
C)  fascism.
D)  socialism.

Question 7

What type of economic system is commonly described as being controlled by an "invisible hand"?

Accepted Answer

A)  A traditional economy.
B)  A command economy.
C)  A market economy.
D)  A communist economy.

Question 8

A principal feature of a command economy is that ____________.

Accepted Answer

A)  production decisions are made by profit-maximizing firms.
B)  there is a central planning board at the top, which transmits economic decisions down to the various producing and consuming units below.
C)  consumers are allowed to determine that is produced based on their demand for goods and services.
D)  regulatory agencies constrain the most egregious forms of market power in a market system of allocation.

Question 9

Which of the following is true in a market economy?

Accepted Answer

A)  Central planners determine answers to the basic economic questions.
B)  Resources are used efficiently.
C)  The distribution of wealth is equal.
D)  Information for production and distribution decisions pass directly to buyers from the government.

Question 10

Which of the following is a criticism of capitalism?

Accepted Answer

A)  Unequal distribution of income.
B)  Failure to protect the environment.
C)  Exploitation of workers.
D)  All of these.

Question 11

Karl Marx published:

Accepted Answer

A)  Das Kapital .
B)  General Theory of Communism .
C)  The Wealth of Nations .
D)  Capitalist Manifesto .

Question 12

Adam Smith believed that a nation would produce the maximum wealth by relying on government to make public interest economic decisions.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following statements is true about a command economy?

Accepted Answer

A)  Shortages occur because of complexities in the planning process.
B)  Planners determine what, how many, and for whom goods and services are to be produced.
C)  Planners often allocate goods and services through a rationing system.
D)  The quality of produced goods and services tends to be inferior.
E)  All of these are true.

Question 14

Which of the following is a basic question answered by an economic system?

Accepted Answer

A)  for whom goods and services are produced.
B)  how goods and services are produced.
C)  what goods and services are produced.
D)  all of these.

Question 15

Discuss the three basic types of economic systems.

Accepted Answer

Three basic economic systems are the tra...

Question 16

The father of modern economics that wrote The Wealth of Nations is:

Accepted Answer

A)  Karl Marx
B)  John Maynard Keynes
C)  Adam Smith
D)  Thorstein Veblen

Question 17

Centralized planning agencies are a key feature of command economies.

Accepted Answer

A) True 
 B)False

Question 18

Most real world economies are mixed economies.

Accepted Answer

A) True 
 B)False

Question 19

In a market economy, the three economic questions are answered by which of the following?

Accepted Answer

A)  Prices determined by the interaction of the forces of supply and demand.
B)  A cartel of major transnational corporations, government agencies, and consumer advocates.
C)  A trilateral commission of major corporations, the military, and elite university professors.
D)  A central authority such as people's committee, a government agency, or a dictator.

Question 20

In a command economy, the basic economic questions are answered by:

Accepted Answer

A)  central authority.
B)  individual buyers and sellers.
C)  the traditional methods.
D)  none of these.

Exam 19: Economies in Transition

Which of the following is true in a market economy?

Correct AnswerverifiedShow Answer

In a market economy, the three economic questions are answered by which of the following?

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A principal feature of a command economy is that ____________.

Correct AnswerverifiedShow Answer

Which of the following is a basic question answered by an economic system?

Correct AnswerverifiedShow Answer

Discuss the three basic types of economic systems.

Correct AnswerverifiedThree basic economic systems are the tra...View AnswerShow Answer

Most real world economies are mixed economies.

Correct AnswerverifiedShow Answer

In Adam Smith's competitive market economy, the question of what goods to produce is determined by:

Correct AnswerverifiedShow Answer

The father of modern economics that wrote The Wealth of Nations is:

Correct AnswerverifiedShow Answer

A traditional system solves basic economic questions by long-standing customs.

Correct AnswerverifiedShow Answer

Karl Marx published:

Correct AnswerverifiedShow Answer

Which of the following is a criticism of capitalism?

Correct AnswerverifiedShow Answer

In Karl Marx's view, people under the ideal state of communism would be motivated by the principle "from each according to his ability, to each according to his enterprise."

Correct AnswerverifiedShow Answer

What type of economic system is commonly described as being controlled by an "invisible hand"?

Correct AnswerverifiedShow Answer

In a command economy, the basic economic questions are answered by:

Correct AnswerverifiedShow Answer

Which of the following statements is true about a command economy?

Correct AnswerverifiedShow Answer

Adam Smith believed that a nation would produce the maximum wealth by relying on government to make public interest economic decisions.

Correct AnswerverifiedShow Answer

Property rights allowing individuals to own goods, services, and factors of production are most important in:

Correct AnswerverifiedShow Answer

Which of the following statements is true ?

Correct AnswerverifiedShow Answer

Centralized planning agencies are a key feature of command economies.

Correct AnswerverifiedShow Answer

The economic system characterized by private ownership of resources and market is:

Correct AnswerverifiedShow Answer

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Three basic economic systems are the tra...
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