Quiz for review 3 issues of economy

This is the quiz for English Economy. Its about economic system: traditional economy, command economy, market economy and mixed economy.Its also about 3 main issues of economy: what to produce, how to produce and for whom to produce. Some of relevant quiz question for other topic are also included in this.

Group 2

Quiz for chapter 2 Three types of economic systems

1 What question(s) must a society ask to make economic decisions?

A What to produce? B How to produce?

C For whom to produce? D All of the above

2 Which type of economy is controlled by the government?

A. Traditional Economy B. Market Economy

C. Command Economy D. Transitional Economy

3 Which type of economy is shaped largely by custom or religion?

A. Traditional Economy B. Command Economy

C. Market Economy D. Transitional Economy

4 Which economic system is influenced by Adam Smith's belief of Laissez-Faire?

A Traditional Economy B. Command Economy

C. Market Economy D. Transitional Economy

5 Which group of decision makers is not included in the private sector?

A. Households B. Firms

C. The Rest of the World D. Government

6 All of the following are examples of a traditional economy except

A Large scale manufacturing B The barter system

C Subsistence agriculture D Hunting and gathering

7 Which activity would be most characteristic of people in a traditional society?

A) Having the same occupation as their parents

B) Working in an industrialized cities

C) Serving in government assemblies

D) Establishing a mercantile system of trade

8 How are major economic decisions made in a command economy?

A) Wholesalers of agricultural goods make most of the decisions

B) Officials of the government control all aspects of economic activity

C) Manufacturers of industrial goods control the resources

D) Supply and demand are determined by consumers of foodstuffs

9 Which of the following lists the economic systems in the correct order they would appear on the economic spectrum?

A) Mixed, Command, Free Enterprise

B) Free Enterprise, Command, Mixed

C) Free Enterprise, Mixed, Command

D) Command, Mixed, Free Enterprise

10 The key principle of the economic theory of communism is …

A) The government ownership, control and regulation of property

B) The privatization of business and production of goods and services

C) The restoration of a bartering system in developing countries

D) The organization of workers’ unions in industrialized nations

11 How can one best describe the economy operating under a free enterprise system?

A) Prices are fixed by agreements among business leaders and labor unions B) Prices change according to changes in the supply and demand for

products

C) All industries except smaller businesses are controlled by the government D) The government sets the prices of products and the quantity of goods

12 How does a command economy differ from a free market

economy?

A) Prices are set by consumers

B) A variety of economic incentives encourage business growth

C) Resources are allocated by government decisions

D) There is a high rate of unemployment

13 What is the function of the government in a command economy?

A) They allow the laws of supply and demand to control the economy

B) They determine the type and quantity of goods to be produced through Five Year Plans

C) Trade policies mandated that imports exceed exports

D) The success of the agricultural sector controls the manufacturer's goods

14 In which economic system would a person expect the widest selection of consumer goods?

A) Socialist

B) Communist

C) Traditional D) Free Enterprise

15 Which group has the greatest influence in determining what goods and services will be produced in a communist economic system?

A) Consumers

B) Farmers

C) Government officials D) Bankers

16 True or False:

a The main goal of Mixed economy is to gain private property

b An economic system in which business are allowed to produce any goods and services they wish to is referred to as a centrally planned economy

c A situation that occurs when two or more businesses try to sell the same type of product to the same customers is referred to as

competition

d When deciding "what to produce", population and resources are said

to be limited

e The items that consumers buy are called producer goods

f A centrally planned economy promotes government ownership, profit and no competition

g An economic system that has Government restrictions on the actions

of individuals and businesses is called a centrally planned economy

h In a free enterprise, private property is discouraged

i The term that indicates ownership, either by individuals or by a

business, is private property

j Uneven distribution of resources, consumer difficulty in obtaining information, and health-risk products are limitations of Free

Enterprise Systems

Answer Key

1 D 2 C 3.C 4.C 5.D 6.A 7.A 8.B 9.C 10.A 11.B 12.C 13.B 14.D 15.C

16 True / false

a T b F (Free Enterprise) c T d F (Resources is limited)

e F (consumer goods) f T g F (a mixed economy)

h F (encouraged) i T J T