Question 1

The two economic groups competing for power during the transition from mercantilism to capitalism were:

Accepted Answer

A)  craft guilds and industrialists.
B)  serfs and craft guilds.
C)  craft guilds and the lords of the manor.
D)  merchants and the lords of the manor.

Question 2

Suppose that at the current price producers of CDs offer 5 million CDs for sale but consumers want to buy 6 million.When the market coordinates the demand and supply for CDs, the price of CDs will:

Accepted Answer

A)  rise.
B)  fall.
C)  stay the same.
D)  be fixed by the government.

Question 3

With a sole proprietorship:

Accepted Answer

A)  all of one's assets are at risk of loss.
B)  shares are valued by the marketplace.
C)  responsibility is shared.
D)  income is taxed twice

Question 4

Which of the following is a good example of government's attempt to correct for macroeconomic externalities?

Accepted Answer

A)  Preventing excessive amounts of pollution
B)  Providing public goods
C)  Maintaining full employment
D)  Providing for smoke-free public spaces

Question 5

Households are on the:

Accepted Answer

A)  supply side of factor markets and the demand side of goods markets.
B)  demand side of factor markets and the supply side of goods markets.
C)  supply side of both factor markets and goods markets.
D)  demand side of both factor markets and goods markets.

Question 6

In feudalism, serfdom was maintained primarily through:

Accepted Answer

A)  market forces.
B)  tradition.
C)  supply and demand.
D)  economic forces.

Question 7

Suppose a single firm gains control of an industry by preventing other firms from entering the industry.As a result, the price charged by the single firm is much higher than the price that would be charged by many different firms producing this product in a competitive market.This situation can best be described as:

Accepted Answer

A)  a market failure.
B)  a government failure.
C)  an efficient outcome.
D)  a competitive outcome.

Question 8

Which two sources of revenue comprise most of federal government revenue?

Accepted Answer

A)  Corporate income taxes and social security taxes and contributions
B)  Corporate income taxes and excise taxes
C)  Individual income tax and corporate income taxes
D)  Individual income tax and social security taxes and contributions

Question 9

The difference between mercantilism and feudalism is that under mercantilism:

Accepted Answer

A)  merchants played a more important political role than kings.
B)  the invisible hand played a more important role than the government.
C)  nation-states ruled by kings who coordinated the economic activity emerged.
D)  economic rather than social and political forces made the central economic decisions.

Question 10

The L3C type of corporation, sometimes called a benefit corporation, ignores profit considerations and instead pursues only social goals.

Accepted Answer

A) True 
 B)False

Question 11

Most economies today are:

Accepted Answer

A)  pure market economies.
B)  differentiated primarily by the degree to which they depend on markets.
C)  differentiated primarily by who owns the means of production.
D)  socialist.

Question 12

Profit is:

Accepted Answer

A)  the same as cost.
B)  the same as revenue.
C)  what is left over from total revenue after all of the appropriate costs have been subtracted.
D)  what is left over from total cost after all of the appropriate revenues have been subtracted.

Question 13

The Marxist critique of capitalism was based on the notion that:

Accepted Answer

A)  a capitalist system ignored traditional class roles.
B)  efficient allocation of resources was not a worthwhile goal.
C)  the proletariat class exploited the capitalist class, which created all the value inherent in goods.
D)  the capitalist class exploited the proletariat class, which created all the value inherent in goods.

Question 14

The largest source of household income in the United States is:

Accepted Answer

A)  stock dividends.
B)  wages and salaries.
C)  interest earnings.
D)  rental income.

Question 15

Which of the following organizations works with developing countries to secure low-interest loans that foster economic growth?

Accepted Answer

A)  World Trade Organization
B)  World Bank
C)  Group of Five
D)  Group of Eight

Question 16

The Soviet socialist economy fell apart primarily because:

Accepted Answer

A)  it was based on barter rather than monetary exchange.
B)  individuals are not motivated by self interest.
C)  workers lacked incentives to work and production was inefficient.
D)  markets failed to develop.

Question 17

International market failures:

Accepted Answer

A)  are more likely to be solved in the presence of a world government.
B)  are less likely to be solved in the presence of a world government.
C)  are equally likely to be solved in the presence or absence of a world government.
D)  do not occur in the presence or absence of a world government.

Question 18

A primary goal of the World Bank is to:

Accepted Answer

A)  channel low-interest loans to developing countries to foster economic growth.
B)  work out repayment plans for developing countries with large international debt.
C)  finance private investment projects around the world.
D)  negotiate trade agreements between nations.

Question 19

In principle, socialism is:

Accepted Answer

A)  less concerned about fairness than capitalism.
B)  just as concerned about fairness as capitalism.
C)  more concerned about fairness than capitalism.
D)  not concerned about fairness at all.

Question 20

Market economies are based upon:

Accepted Answer

A)  private property and individual good will toward others.
B)  government planning and individual good will toward others.
C)  government planning and individual self-interest.
D)  private property and individual planning.

Exam 3: Economic Institutions

Market economies are based upon:

Correct Answer
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Households are on the:

Correct Answer
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Which of the following is a good example of government's attempt to correct for macroeconomic externalities?

Correct Answer
verified

A primary goal of the World Bank is to:

Correct Answer
verified

The Marxist critique of capitalism was based on the notion that:

Correct Answer
verified

Suppose that at the current price producers of CDs offer 5 million CDs for sale but consumers want to buy 6 million.When the market coordinates the demand and supply for CDs, the price of CDs will:

Correct Answer
verified

In principle, socialism is:

Correct Answer
verified

The largest source of household income in the United States is:

Correct Answer
verified

Most economies today are:

Correct Answer
verified

Profit is:

Correct Answer
verified

Which two sources of revenue comprise most of federal government revenue?

Correct Answer
verified

With a sole proprietorship:

Correct Answer
verified

Correct Answer
verified

Which of the following organizations works with developing countries to secure low-interest loans that foster economic growth?

Correct Answer
verified

International market failures:

Correct Answer
verified

The L3C type of corporation, sometimes called a benefit corporation, ignores profit considerations and instead pursues only social goals.

Correct Answer
verified

The Soviet socialist economy fell apart primarily because:

Correct Answer
verified

The difference between mercantilism and feudalism is that under mercantilism:

Correct Answer
verified

The two economic groups competing for power during the transition from mercantilism to capitalism were:

Correct Answer
verified

In feudalism, serfdom was maintained primarily through:

Correct Answer
verified

Exam 3: Economic Institutions

Market economies are based upon:

Correct AnswerverifiedShow Answer

Households are on the:

Correct AnswerverifiedShow Answer

Which of the following is a good example of government's attempt to correct for macroeconomic externalities?

Correct AnswerverifiedShow Answer

A primary goal of the World Bank is to:

Correct AnswerverifiedShow Answer

The Marxist critique of capitalism was based on the notion that:

Correct AnswerverifiedShow Answer

Suppose that at the current price producers of CDs offer 5 million CDs for sale but consumers want to buy 6 million.When the market coordinates the demand and supply for CDs, the price of CDs will:

Correct AnswerverifiedShow Answer

In principle, socialism is:

Correct AnswerverifiedShow Answer

The largest source of household income in the United States is:

Correct AnswerverifiedShow Answer

Most economies today are:

Correct AnswerverifiedShow Answer

Profit is:

Correct AnswerverifiedShow Answer

Which two sources of revenue comprise most of federal government revenue?

Correct AnswerverifiedShow Answer

With a sole proprietorship:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following organizations works with developing countries to secure low-interest loans that foster economic growth?

Correct AnswerverifiedShow Answer

International market failures:

Correct AnswerverifiedShow Answer

The L3C type of corporation, sometimes called a benefit corporation, ignores profit considerations and instead pursues only social goals.

Correct AnswerverifiedShow Answer

The Soviet socialist economy fell apart primarily because:

Correct AnswerverifiedShow Answer

The difference between mercantilism and feudalism is that under mercantilism:

Correct AnswerverifiedShow Answer

The two economic groups competing for power during the transition from mercantilism to capitalism were:

Correct AnswerverifiedShow Answer

In feudalism, serfdom was maintained primarily through:

Correct AnswerverifiedShow Answer

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