Question 1

The economic system that is generally considered to be the most efficient at answering the What to produce and the How to produce questions is the:

Accepted Answer

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

Question 2

In the real world,most economic systems are:

Accepted Answer

A)  market economies. 
B)  command economies 
C)  mixed economies. 
D)  traditional economies. 
A)  market economies. 
B)  command economies 
C)  mixed economies. 
D)  traditional economies. C

Question 3

The term "socialism" refers to which of the following?

Accepted Answer

A)  A religion centered on community interaction. 
B)  An economic system characterized by private ownership of resources, and decentralized market allocation. 
C)  An economic system characterized by government ownership of resources and centralized allocation. 
D)  None of the above. 
A)  A religion centered on community interaction. 
B)  An economic system characterized by private ownership of resources, and decentralized market allocation. 
C)  An economic system characterized by government ownership of resources and centralized allocation. 
D)  None of the above. C

Question 4

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 the above are true. 
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 the above are true.

Question 5

An economic system is the organizations and methods used to determine:

Accepted Answer

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

Question 6

Karl Marx viewed socialism only as a transition to the ideal state of communism.

Accepted Answer

A) True 
 B)False

Question 7

A classless society and economic system where all the factors of production are owned by workers and people share production according to their needs describes:

Accepted Answer

A)  capitalism. 
B)  communism. 
C)  the invisible hand. 
D)  a mixed economy. 
A)  capitalism. 
B)  communism. 
C)  the invisible hand. 
D)  a mixed economy.

Question 8

A market system does not operate based on self-interest.

Accepted Answer

A) True 
 B)False

Question 9

A traditional system operates based on the self interest of buyers and sellers.

Accepted Answer

A) True 
 B)False

Question 10

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

Question 11

A command system uses a group of planners or central authority to make basic economic decisions.

Accepted Answer

A) True 
 B)False

Question 12

An economic system that answers the What,How,and For Whom questions using prices determined by the interaction of the forces of supply and demand is a:

Accepted Answer

A)  market economy. 
B)  command economy. 
C)  traditional economy. 
D)  none of the above. 
A)  market economy. 
B)  command economy. 
C)  traditional economy. 
D)  none of the above.

Question 13

Under socialism,no markets can operate at all.

Accepted Answer

A) True 
 B)False

Question 14

Adam Smith's book The Wealth of Nations was published at the time of the:

Accepted Answer

A)  Great Depression. 
B)  U.S. Declaration of Independence. 
C)  U.S. Civil War. 
D)  War of 1812. 
A)  Great Depression. 
B)  U.S. Declaration of Independence. 
C)  U.S. Civil War. 
D)  War of 1812.

Question 15

The economic system that answers the What,How and For Whom questions the way they have always been answered is a:

Accepted Answer

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

Question 16

What famous economist said that the market economy seemed to be controlled by an invisible hand?

Accepted Answer

A)  Alfred Marshall. 
B)  Adam Smith. 
C)  Karl Marx. 
D)  Robert L. Heilbroner. 
A)  Alfred Marshall. 
B)  Adam Smith. 
C)  Karl Marx. 
D)  Robert L. Heilbroner.

Question 17

In a traditional economy,innovation is encouraged.

Accepted Answer

A) True 
 B)False

Question 18

Under socialism,factories,farms,mines,and natural resources are owned by:

Accepted Answer

A)  laborers. 
B)  government. 
C)  private stockholders. 
D)  no one. 
A)  laborers. 
B)  government. 
C)  private stockholders. 
D)  no one.

Question 19

Adam Smith wrote that the:

Accepted Answer

A)  economic problems of eighteenth-century England were caused by free markets. 
B)  government should control the economy. 
C)  pursuit of private self interest promotes the public interest in a market economy. 
D)  public or collective interest is not promoted by people pursuing their self interest. 
A)  economic problems of eighteenth-century England were caused by free markets. 
B)  government should control the economy. 
C)  pursuit of private self interest promotes the public interest in a market economy. 
D)  public or collective interest is not promoted by people pursuing their self interest.

Question 20

The economic system in which the basic economic questions are answered through markets with some government intervention is a:

Accepted Answer

A)  command economy. 
B)  mixed economy. 
C)  market economy. 
D)  planned economy. 
A)  command economy. 
B)  mixed economy. 
C)  market economy. 
D)  planned economy.

Exam 22: Economies in Transition

The economic system that is generally considered to be the most efficient at answering the What to produce and the How to produce questions is the:

In the real world,most economic systems are:

The term "socialism" refers to which of the following?

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

An economic system is the organizations and methods used to determine:

Karl Marx viewed socialism only as a transition to the ideal state of communism.

A classless society and economic system where all the factors of production are owned by workers and people share production according to their needs describes:

A market system does not operate based on self-interest.

A traditional system operates based on the self interest of buyers and sellers.

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

A command system uses a group of planners or central authority to make basic economic decisions.

An economic system that answers the What,How,and For Whom questions using prices determined by the interaction of the forces of supply and demand is a:

Under socialism,no markets can operate at all.

Adam Smith's book The Wealth of Nations was published at the time of the:

The economic system that answers the What,How and For Whom questions the way they have always been answered is a:

What famous economist said that the market economy seemed to be controlled by an invisible hand?

In a traditional economy,innovation is encouraged.

Under socialism,factories,farms,mines,and natural resources are owned by:

Adam Smith wrote that the:

The economic system in which the basic economic questions are answered through markets with some government intervention is a:

Introducing the Economic Way of Thinking

A: Appendix: Applying Graphs to Economics

Production Possibilities,Opportunity Cost,and Economic Growth

Part 1: Market Demand and Supply

Part 2: Market Demand and Supply

Markets in Action

Price Elasticity of Demand

Production Costs

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Labor Markets and Income Distribution

Gross Domestic Product

Business Cycles and Unemployment

Inflation

Aggregate Demand and Supply

A: Appendix: The Self-Correcting Aggregate Demand and Supply Model

Fiscal Policy

The Public Sector

Federal Deficits,Surpluses,and the National Debt

Money and the Federal Reserve System

Money Creation

Monetary Policy

A: Appendix: Policy Disputes Using the Self-Correcting Aggregate Demand and Supply Model

International Trade and Finance

Growth and the Less-Developed Countries

Filters