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Economic Systems > Quiz 2 > Flashcards

Quiz 2 Flashcards

1
Q

no other economist has had as much influence as

A

Adam Smith

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2
Q

In the _____________, smith challenged the idea of mercantilism being economically sound

A

Wealth of Nations

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3
Q

______________ is a system by which the government of the homeland controlled trade with its colonies

A

Mercantilism

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4
Q

A nation would be wealthier if it engaged in__________

A

free trade

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5
Q

He reasoned that people behave in ways satisfy their ______________ also helpes with voluntarry exchange

A

economic self-interest

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6
Q

An _______________ guides the marketplace

A

“invisible hand”

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7
Q

A system in which the society’s leaders usually members of the central government make all economic decision is called a _________________

A

centrally planned economy

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8
Q

Modern societies that have adopted command economies have done so largely because of the influence of _______

A

Karl Marx

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9
Q

Marx predicted that in time the workers would overthrow this system and transfer ownership of the factories to _______________

A

public hands

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10
Q

________ is an economic system in which the government owns some or all of the factors of production

A

Socialism

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11
Q

_______ is an economic system in which the government owns all the factors of production and there is little or no political freedom

A

Communism

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12
Q

an ____________ require absolute obedience to those in power this is what communism will usually become

A

authoritarian system

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13
Q

______________ is established through the democratic political process rather than through the violent overthrow of the government

A

Democratic socialism

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14
Q

In democratic socialism the government owns the ____________________

A

basic industries but other industries are privately owned

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15
Q

Marx would be exiled from his homeland for becoming involved in

A

radical politics

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16
Q

During his travels he met ___________ the son of a factory worker

A

Friedrich Engels

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17
Q

Marx concluded that the Industrial Revolution had created a system of ______

A

wage slavery

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18
Q

Marx assisted by Engels laid out ideas of worker overthrow in the ____________

A

Communist Manifesto (1848)

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19
Q

still has an economy with mostly command elements

A

north korea

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20
Q

Self interest behavior is behind two features of a market economy:

A

private property rights

market

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21
Q

________________ are the rights of individuals and groups to own businesses and resources

A

Private property rights

22
Q

The ___________ is any place where people buy and sell goods and services

A

market

23
Q

_________________ are necessary to make markets work property

A

Private property rights

24
Q

The principle that the government should not interfere in the economy is called_____________

A

laissez faire

25
Q

the concept of laissez faire is often paired with __________

A

capitalism

26
Q

_____________ is an economic system that is based on private ownership of the factors of production

A

Capitalism

27
Q

_____________ is a market economy in its pure form

A

Laissez faire capitalism

28
Q

a _____________ is a trade in which both traders believe that what they are getting is worth more than what they are giving up

A

voluntary exchange

29
Q

__________ is considered a financial gain from a business transaction

A

profit

30
Q

_________ is the effort of two or more people acting independently to get the business of others by offering the best deal

A

Competition

31
Q

_____________ is the idea that because consumers are free to purchase what they want and refuse products they do not have the ultimate control over what is produced

A

Consumer sovereignty

32
Q

______________ is a situation in which people concentrate their efforts in the areas which they have an advantage

A

Specialization

33
Q

Specialization _______________________ and markets allow households to trade for what they need

A

removes the need for household to be self-sufficient

34
Q

The ______________ is a tool that economists use to understand how market economies operate

A

circular flow model

35
Q

The model represents the two key economic decisions makers in a market economy

A

households

businesses

36
Q

The market for goods and services is called the ____________

A

product market

37
Q

The _____________ is the market for the factors of production

A

factor market

38
Q

Individuals own all the _____________

A

factors of production

39
Q

_______________ a key feature of the market economy ensures that resources will be allocated efficiently since inefficiencies would result in lower profits

A

profit motive

40
Q

___________ to come up with good ideas is related to another advantage of a market economy: Competition

A

Incentives

41
Q

Competition leads to higher-quality products at lower prices and helps create a __________________

A

diverse product market

42
Q

In a ____________________ the economic good of the individual is the primary focus

A

pure market economy

43
Q

The _____________ is the most common type of economic system today

A

mixed economy

44
Q

A mixed economy is an economy that has elements of _____________________

A

traditional, command, and market systems

45
Q

Even though there are traditional and command elements the driving forces of the US economy are such features as __________________

A

private ownerships and markets

46
Q

Swedish citizens receive ___________ social benefits

A

“cradle to grave”

47
Q

To __________ means to change from private ownership to government or public ownership

A

nationalize

48
Q

To __________ means to change from government or public ownership to private ownership

A

privatize

49
Q

One way to help privatize an industry is to open it up to _____________

A

foreign investors

50
Q

the _____________ refers to all the economic interactions that cross international boundaries

A

global economy

51
Q

Globalization also have been enhanced by _____________________

A

cross-border business partnerships

Economic Systems (2 decks)

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