Answer the following questions.
1) Match the words with the descriptions.
capitalism, nationalization, planned economy, market economy, command economy, communism, laissez-faire, socialism, mixed economy. possible answers
an economic system with little or no involvement by the government
economic system where individual may own private property and take a risk in order to make a profit
an economic system in which private industry and the government both have a role
an economic system that focuses on economic equality through public ownership of property and resources
state-directed economy
a state-controlled economic system and ruling political party in which all products and services are collected and redistributed by government agencies
another name for capitalism or free enterprise
the economy of socialism and communism
the socialist government takeover of a private industry for public use
2) Check all that apply.
market.
| LARGE CORPORATIONS FIXED PRICES. | |
| BUSINESSES FORMED MONOPOLIES. | |
| IT WAS NECESSARY TO REGULATE IMPORTS AND EXPORTS. | |
| INEQUITIES EXISTED IN WAGES. |
3) Check all that apply.
How do antitrust laws protect the free market?
| They equalize profits. | |
| They redistribute wealth. | |
| They promote competition. | |
| They break up monopolies. |
4) Select the best answer.
What would be the best title for the above diagram?
| Communism: State Distribution and Ownership | |
| Free Enterprise: Public Ownership | |
| Socialism: Equality for all | |
| Capitalism: A System of Choices |
5) Check all that apply.
What are the three basic economic systems?
| democracy | |
| communism | |
| socialism | |
| monopoly | |
| globalism | |
| capitalism |
6) Check all that apply.
Give TWO reasons a developing country might choose socialism as its economic system.
| Government expenses are reduced to a minimum. | |
| It provides a solution to deal with struggling industries while ostensibly increasing national employment and profit. | |
| Socialism appeals to politicians who desire absolute power. | |
| The government can channel profits to meet economic needs that would be considered unprofitable under capitalism. |
7) Check all that apply.
Place a check mark by all answers that represent capitalism.
| guaranteed success | |
| right to own property | |
| public ownership of goods and services | |
| competition | |
| freedom of choice | |
| equal wages | |
| right to risk capital and enjoy profit if successful |
8) Check all that apply.
Select TWO examples of indirect controls that can place pressure on the market to produce specific goods and services.
| expanding laissez-faire policies | |
| allowing local governments to establish their own quotas | |
| setting prices for products and supplies | |
| controlling the allocation of labor and resources |
9) Type the correct answers.
Does the United States have a laissez-faire economic system? Explain your answer.
10) Type the correct answers.
What is the main difference between a market and a command economy?