Question

QUESTION 1

The concept of economic efficiency is primarily concerned with:

	A.	the different institutions fostered by the various "isms".
	B.	the conservation of irreplaceable natural resources.
	C.	obtaining the maximum output from available resources.
	D.	considerations of equity in the distribution of wealth.
	E.	the limited wants-unlimited resources dilemma.

QUESTION 15

The law of supply indicates that:

	A.	producers will offer more of a product at low prices than they will at high prices.
	B.	consumers will purchase less of a good at high prices than they will at low prices
	C.	the product supply curve is downsloping
	D.	producers will offer more of a product at high prices than they will at low prices.

QUESTION 16

Which of the following best describes the "invisible hand" concept?

	A.	Central direction by the government will improve resource allocation in a capitalistic economy.
	B.	Mixed capitalism is the best system for overcoming the scarce resources-unlimited wants problem.
	C.	The nonsubstitutability of resources gives rise to a conflict between private and public interests and the need for government intervention.
	D.	The desires of resource suppliers and producers to further their own self interests will automatically further the public interest.

QUESTION 17

The American economy is called "mixed capitalism" because:

	A.	a large percentage of business enterprises are jointly owned by government and private business.
	B.	the capital of most business enterprises is furnished from Federal funds.
	C.	the answers to the questions of What, How and For Whom are to some extent determined by government but mostly by private individuals and business.
	D.	the products of many business enterprises are used partly by businesses and partly by consumers.

QUESTION 18

To say that a price is "too low for equilibrium" means that:

	A.	producers are making substantial profits
	B.	consumers want to pay a lower price than sellers are currently charging.
	C.	there will occur a surplus of the product.
	D.	the amount demanded exceeds the amount supplied.

QUESTION 19

A point on a demand curve indicates:

	A.	a particular price and the corresponding quantity demanded by consumers.
	B.	a combination of two consumer goods which buyers will choose at given prices.
	C.	a situation where the buying and selling decisions of consumers and producers are consistent.
	D.	the ratio of the selling price to the buying price.

QUESTION 21

An economic system can be best characterized as:

	A.	a complete set of plans on how goods and services should be produced.
	B.	guidelines for determining wages, prices, and interest payments.
	C.	the set of principles a nation adopts in answering the central economic problem of scarcity and the related questions What? How? and For Whom?
	D.	a set of rules for determining the relationship between groups.

QUESTION 25

Which of the following is NOT a characteristic of pure capitalism?

	A.	a limited role for government
	B.	private ownership of property
	C.	concern for the welfare of your fellow man
	D.	freedom of enterprise
	E.	many buyers and sellers in competitive markets

QUESTION 28

The economic system that was most prominent in Europe when Adam Smith wrote his famous book The Wealth of Nations was:

	A.	mercantilism
	B.	capitalism
	C.	mixed capitalism
	D.	socialism

QUESTION 29

The principles of communism were popularized by:

	A.	Groucho Marx
	B.	Karl Marx
	C.	George Meany
	D.	Charles Fourier and Robert Owens.

QUESTION 30

The most important difference among economic systems is:

	A.	the choice between using the market mechanism or government planning.
	B.	whether a liberal or conservative party is in power.
	C.	the degree to which institutions within the nation are democratic.
	D.	how interest rates are determined.

QUESTION 31

Two series of economic data which are directly related will graph as an upsloping line on a graph.

True

False

QUESTION 32

Graphs are important in the social sciences because they contain more information than the data upon which they are based.

True

False

Answer 1

1.

The answer is C.

C.obtaining the maximum output from available resources.

The problem of economic efficiency is adressing the question of allocation of resources in such a way that they can produce the maximum level of output.

2.

The answer is D.

D.producers will offer more of a product at high prices than they will at low prices.

According to the law of supply,ceteris paribus,an increase in the price of a product will lead to an increase in the quantity supplied and vice-versa.

3.

The answer is D

D.The desires of resource suppliers and producers to further their own self interests will automatically further the public interest.

According to Adam Smiths the law of invisible hand, self interest of producers and consumers directs the market to equilibrium.

4.

The answer is C

C.The answers to the questions of What, How and For Whom are to some extent determined by government but mostly by private individuals and business.

An economy is called as mixed capitalism because of the presence of a large govrenment in a capitalist economy.