Question 1

Which statement is the most accurate?

Accepted Answer

A)  China is a completely economically backward nation.
B)  China's economic growth has been extremely low for the last 20 years.
C)  China is subjected to periodic famine.
D)  Since 1978,Chinese leaders have relaxed rigid party control of the economy and permitted more individual initiative.E) B) and C)
F) A) and C)

Question 2

Under private enterprise,production is guided by ____________________________.

Accepted Answer

The answer of Under private enterprise,production is guided by ____________________________....

Question 3

Having the government issue permits that allow polluting

Accepted Answer

A)  would increase the levels of pollution.
B)  is a measure used all over the world,but not in the United States.
C)  would allow companies that are better at curbing their pollution to sell the permits to companies that are not as good at curbing their pollution.
D)  has been very ineffective in curbing pollution.E) A) and B)
F) A) and C)

Question 4

Karl Marx and Friedrich Engels believed that the ideal communist society would come about when

Accepted Answer

A)  the state withered away.
B)  the state gained control of the economy's means of production.
C)  there was private ownership of the means of production.
D)  all large corporations remained in private hands,but were regulated by the government.E) A) and D)
F) All of the above

Question 5

Statement I.Under our economic system the most important decisions are made in the marketplace.
Statement II.Most economists would agree that the price system leads to a very efficient allocation of resources.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) A) and B)
F) A) and C)

Question 6

To have competition as economists define it,

Accepted Answer

A)  you need many firms in an industry,with no one firm having any influence over price.
B)  you need a couple of firms in the industry,with each having significant influence over the price.
C)  you need many firms in an industry,and it doesn't matter if one firm has influence over price.
D)  All of these statements are true.E) B) and C)
F) A) and D)

Question 7

There has been a marked reduction in air pollution since ________________.

Accepted Answer

The answer of There has been a marked reduction in...

Question 8

"From each according to his ability;to each according to his needs" is from

Accepted Answer

A)  The Communist Manifesto.
B)  The Capitalist Manifesto.
C)  The Socialist Manifesto.
D)  The Fascist Manifesto.E) All of the above
F) B) and C)

Question 9

In reality,all economic systems are

Accepted Answer

A)  mixed.
B)  command.
C)  capitalistiC.
D)  democratic.
E)  socialistic.F) All of the above
G) A) and E)

Question 10

In the former Soviet Union distributing scarce consumer goods was accomplished by

Accepted Answer

A)  higher prices which eliminated some potential consumers.
B)  making the consumer stand in a long line for hours if not days.
C)  the government simply printing more money.
D)  None of the choices are true.E) A) and C)
F) B) and D)

Question 11

Statement I.The circular flow model traces the flow of money,resources,and goods and services through the economy.
Statement II.Most household income is spent on investment or capital goods.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) B) and C)
F) None of the above

Question 12

Which statement is the most accurate?

Accepted Answer

A)  Ordering a pencil for work in a communist economy usually is less complicated than the same process in a capitalist economy.
B)  Rules and regulations bind Communist bureaucrats because there is no trust that a bureaucrat can make simple business decisions.
C)  Because of underlying trust,business flows smoothly in virtually all communist societies.
D)  Ordering a pencil for work is equally complicated in a capitalist and a communist business.E) All of the above
F) C) and D)

Question 13

The government performs each of the following economic functions except

Accepted Answer

A)  collecting taxes.
B)  spending.
C)  issuing regulations.
D)  operating the price mechanism.E) A) and C)
F) A) and B)

Question 14

Lack of the provision of public goods is considered a ______________ _____________.

Accepted Answer

The answer of Lack of the provision of public goods...

Question 15

In the 1980s,___________________ strictly adhered to the communist credo,"From each according to his ability,to each according to his needs".

Accepted Answer

A)  China,but not the Soviet Union
B)  The Soviet Union,but not China
C)  Both China and the Soviet Union
D)  Neither China nor the Soviet UnionE) A) and D)
F) B) and C)

Question 16

Adam Smith believed that the best way to promote the public interest was to

Accepted Answer

A)  have the government produce most goods and services.
B)  let people pursue their own selfish interests.
C)  wait for individuals to set out to promote the public interest.
D)  get rid of the price mechanism.E) None of the above
F) All of the above

Question 17

When the production or consumption of some good or service inflicts costs on a third party without compensation it is called a(n)__________ _________.

Accepted Answer

The answer of When the production or consumption of some...

Question 18

Statement I.Pollution is an example of market failure.
Statement II.Externalities can be costs or benefits.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) All of the above
F) A) and B)

Question 19

China embarked on a large-scale privatization since ___________.

Accepted Answer

The answer of China embarked on a large-scale privatization since...

Question 20

Which does not fit with the others?

Accepted Answer

A)  "The invisible hand"
B)  Government regulations
C)  A government "five-year plan"
D)  Government planningE) All of the above
F) C) and D)

Exam 3: The Mixed Economy

To have competition as economists define it,

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Which statement is the most accurate?

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There has been a marked reduction in air pollution since ________________.

Correct AnswerverifiedShow Answer

Adam Smith believed that the best way to promote the public interest was to

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Statement I.Pollution is an example of market failure. Statement II.Externalities can be costs or benefits.

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Lack of the provision of public goods is considered a ______________ _____________.

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China embarked on a large-scale privatization since ___________.

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Karl Marx and Friedrich Engels believed that the ideal communist society would come about when

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In the former Soviet Union distributing scarce consumer goods was accomplished by

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In reality,all economic systems are

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Having the government issue permits that allow polluting

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When the production or consumption of some good or service inflicts costs on a third party without compensation it is called a(n)__________ _________.

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Which statement is the most accurate?

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The government performs each of the following economic functions except

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Statement I.The circular flow model traces the flow of money,resources,and goods and services through the economy. Statement II.Most household income is spent on investment or capital goods.

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Which does not fit with the others?

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Under private enterprise,production is guided by ____________________________.

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In the 1980s,___________________ strictly adhered to the communist credo,"From each according to his ability,to each according to his needs".

Correct AnswerverifiedShow Answer

"From each according to his ability;to each according to his needs" is from

Correct AnswerverifiedShow Answer

Statement I.Under our economic system the most important decisions are made in the marketplace. Statement II.Most economists would agree that the price system leads to a very efficient allocation of resources.

Correct AnswerverifiedShow Answer

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Lack of the provision of public goods is considered a __ _.

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When the production or consumption of some good or service inflicts costs on a third party without compensation it is called a(n)__ _.

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