U.S. Gov. and Economics Pt. 2 (Exam 2) – Flashcards
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In what kind of an economy does the government make all the decisions?
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centrally planned
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Which of the following is a characteristic of a traditional economy?
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(It Is NOT "It is usually based on light industrial production")
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What is the main difference between the economies of China and North Korea?
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China is privatizing businesses.
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The following lists are nations with mixed economies. In which list is the free market most dominant?
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United States, United Kingdom, Singapore, Hong Kong
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An economy in which all the boys become farmers when they are adults, just as their fathers and grandfathers did, would be an example of a
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traditional economy
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A mixed economy has more _____ than a free market system does.
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government involvement
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A socialist believes that wealth should be spread evenly throughout society. What characteristic of socialism is designed to achieve this goal?
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The government controls the centers of economic power.
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What is the purpose of the "circular flow model of a market economy?"
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It shows how households and firms exchange money, resources, and products in the marketplace.
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Where are traditional economies usually found?
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in small communities that avoid change
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Why are free market economies able to attain economic growth?
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Competition encourages innovation, which causes growth.
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Which of the following results from having a nation having conflicting economic goals?
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the need to rank choices in order of importance
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What is one advantage of a centrally planned economy?
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low unemployment due to guaranteed jobs
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To improve its standard of living, a nation's economy must
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grow through innovation.
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Which of the following is part of communism but not socialism?
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authoritarian government
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What does the process of specialization do for an economy?
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It makes production more efficient.
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A town wants to repair a school in one of its poorest neighborhoods. To pay for it, citizens vote to raise taxes on households and businesses. What social goal best explains this economic decision?
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equity
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What do people supply in return for factor payments?
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land, labor, or capital
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Command economies:
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(It Is NOT "Are considered a type of free market economy")
