ECONOMICS
Quiz THREE
Name: ________________________________
Period: _____ Date: __________
Multiple Choice
____
1.
Which of the following would be most closely associated with the view that free markets, if left alone, would provide the
greatest benefits for consumers?
a.
b.
____
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
c.
d.
an arrangement that allows buyers and sellers to exchange
a place where freedom of choice is most important
Because people are self-sufficient
Because people are not self-sufficient
c.
d.
Because people are focused on pursuit of self-interest
Because people are engaged in competition
Markets are self-sufficient
Markets are self-regulating
c.
d.
Karl Marx was correct in his theories about economics
The pursuit of self-interest would lead to out-of-control greed
the pursuit of happiness
love of winning
c.
d.
selfish beliefs
the pursuit of self-interest
pursuit of profits
competition
c.
d.
government
space aliens
Open opportunity
Private property
c.
d.
Legal equality
Income equality
Public disclosure laws
Protection of health and safety
c.
d.
Provision of certain goods and services
Guarantee of a minimum standard of living
Government attempts to address the poverty problem in America usually includes each of the following, EXCEPT
a.
b.
____
a place where people buy and sell goods and services
the result of specialization
Government involvement in a market economy will include each of the following, EXCEPT
a.
b.
____
Any part of the economy that is available to the public
Owned and operated by the government for the benefit of
the public
Each of the following is a key benefit of a free enterprise system, EXCEPT
a.
b.
____
c.
d.
According to most economists and many other people, the main force that regulates a free market economy is
a.
b.
____
Owned and operated by the public for individual benefits
Owned and operated by government for its own benefit
Most economists would say that the key reason why people choose to do what they do in a market economy is
a.
b.
____
Generate more taxes for government
Lead to a more fair distribution of wealth
A person running for president who says “I strongly believe the way to achieve economic prosperity in America is to
reduce government regulation of business” would also tend to believe that
a.
b.
____
c.
d.
Why do markets exist?
a.
b.
____
Increase prices
Raise the standard of living
Which of the following best describes a “market”?
a.
b.
____
A laissez faire philosophy
A person in charge of regulating business
The public sector of a market economy is:
a.
b.
____
c.
d.
People who support free markets and fight against government regulation often argue that free markets will
a.
b.
____
Karl Marx
Centrally planned economies
Welfare programs
Social Security
c.
d.
Education
Lowering taxes on income
Basic roles of government include each of the following, EXCEPT
a.
b.
Providing a social safety net
Guaranteeing economic growth
c.
d.
Regulating business
Providing public goods and services
Matching
A.
B.
Market economy
Command economy
C. Traditional economy
D. Mixed economy
_____ 13.
In this type of economy, people essentially do what they have always done regarding work and consumption.
_____ 14.
The Chinese economy is an example of this type.
_____ 15. If government did NOT exist in America, we would have this type of economy.
True or False
____
16. Centrally planned economies tend to discourage change and innovation.
____
17. Free markets tend to encourage economic growth.
____
18. In a free enterprise system, the profit motive does not drive individuals to produce more and better goods and services.
____
19. If you are shopping at Target and Costco this weekend, you will be in the public sector of the economy.
____
20. If a company dumps toxic chemicals into local streams, it would be creating a negative externality.
____
21. The fact that America has millions of people living in poverty is an example of the concept of “market failure”.
____
22. Assume the government buys various companies, including Microsoft and Apple. This would be an example of “privatization”.
True or False
In the circular flow model of a market economy:
_____ 23.
Goods and services are part of the factor market.
_____ 24.
Households provide labor to firms, while money flows back to households in exchange.
_____ 25.
Taxes flow to government from the factor market flow, but NOT from the product market flow.