economic systems review. in a command economy, economic decisions are made by individuals. false
TRANSCRIPT
Economic Systems Review
In a command economy, economic decisions are made by individuals.
False
The kind of system in which the individuals own and control the factors of production is a command economy.
False
In a system of pure competition, the role of the government is to regulate prices.
False
A free enterprise system is based on individual initiative.
True
Economic equity refers to fair play in the economy.
True
In a laissez-faire system, the government does not interfere in the economy.
True
Adam Smith’s “invisible hand” refers to the role of the ______.
Market
A laissez-faire system is one in which government inference in the economy is __________.
Minimal
A major characteristic of a pure market economy is _________.
CompetitionLittle or no government
Freedom of choiceFreedom of enterprise
Private PropertyProfit Incentive
Another term for a capitalist system is a _______ economy.
Market
The word “equity” means _________.
Fairness
Name a country that is a prime example of a command economy.
North KoreaChina
Nazi Germany
In a capitalist system, most property is ___________.
Private Property
It is easier to start a business in a ________ system.
MarketFree Enterprise
Capitalist
Which economies answer all three of the basic economic questions?
All
What type of economic system is described in this passage?
Traditional
“So long as mankind lived by raising crops and herding animals, there was not much need for measuring small units of time. The seasons were all important—to know when to expect the rain, the snow, the sun, the cold. Why bother with hours and minutes? Daylight was the only important time, the only time when men could work.” Source: Daniel J. Boorstin’s The Discoverers: A History of Man’s Search to Know His World and Himself, 1985.
What is rivalry among producers?
Competition
What is the desire to make money?
Profit Incentive
What economic system depends on decisions made by the government?
Command
What system states that government should interfere minimally?
Laissez-faire
What is the expansion of the economy?
Economic Growth
In which economic system is it easiest to start your own business?
Market
What is another term for a capitalist system?
Market
What answers the three basic economic questions in a traditional system?
Traditions, Customs, and
beliefs
What is the material well-being of an individual, group, or nation?
Standard of Living
What is a freely chosen activity between buyers and sellers of goods and services?
Market