AnswersEconomics Full-YearComparing Economic Systems

Comparing Economic Systems — Quiz Answers

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1
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What is one effect of monopolies on market economies?

A
increased prices
B
decreased unemployment
C
decreased demand for products
D
increased economic choices
2
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Which statement best describes how a command economy impacts economic growth?

A
It does not affect economic growth because the government only produces what it needs.
B
It accelerates economic growth by producing goods in the most efficient ways possible.
C
It slows economic growth by limiting competition and discouraging new ideas and innovations.
D
It encourages economic growth by ensuring that most people have a job.
3

What is one way a command economy may likely benefit the lives of most private citizens?

A
by keeping unemployment low and wages high
B
by promoting a variety of goods and services
C
by allowing people to make most economic decisions
D
by providing access to nationalized healthcare
4

Which trait is shared by both free-market and mixed-market systems?

A
Individuals are able to own and control resources.
B
Taxes and tariffs are used to fund social welfare programs.
C
The government plays no role in economic decision-making.
D
There are governmental regulations in place to protect workers.
5

Which phrase best describes the primary goal of a command economy?

A
to ensure that all involved in the economy are able to benefit
B
to provide everyone access to the same economic opportunities
C
to centralize economic planning and meet production goals
D
to make economic decisions guided by tradition and culture
6

Which of these businesses most likely exists in a free-market economy?

A
A government-owned company produces medical equipment. The government decides how the equipment will be distributed and how much consumers will pay.
B
The owner of a small bakery has seven employees. She must increase her employees’ hourly rate after the government increases the minimum wage.
C
A business owner opens a factory to produce airplane parts. The business owner decides which parts and how many to produce based on customer orders.
D
Community members hunt animals and harvest crops. They use little money and trade with each other to obtain anything else they might need.
7

Which example suggests a command economy?

A
A shop owner increases production of a toy in high demand and short supply.
B
The government regulates a private refinery’s release of pollutants into the air.
C
The government instructs a factory to make 5,000 T-shirts.
D
A family trades vegetables from their garden for meat.
8

Which phrase best describes the characteristics of a monopoly?

A
a group of companies that encourage competition by creating new products
B
a group of companies that produce and sell products at similar prices
C
a large company that dominates its industry with little or no competition
D
a large company that efficiently produces high-quality goods or services
9

What is one way the government of a mixed-market economy encourages economic growth?

A
universal employment
B
commitment to tradition
C
consumer protections
D
detailed production goals
10

How are prices determined differently in a free-market economy versus a command economy?

A
In a command economy, consumers control prices, while in a free-market economy, the government controls prices.
B
In a command economy, the market controls prices, while in a free-market economy, manufacturers control prices.
C
In a command economy, manufacturers control prices, while in a free-market economy, consumers control prices.
D
In a command economy, the government controls prices, while in a free-market economy, the market controls prices.

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