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- 1. Multiple Choice
Which is not a basic principle of a market system
competition
voluntary exchange
socialism
self-interest
- 2. Multiple Choice
Which of the following does not follow with the basic principles of market systems?
People are driven by their desire to make a profit
competition is discouraged
people feel best when they freely trade for what they want
innovation is encouraged
- 3. Multiple Choice
Private property rights
Should not be enforced by the government
Are protected by the government
Do not exist in capitalist markets
Are optional for success in the market
- 4. Multiple ChoiceThe law of demand stateswhen prices rise, the amount people will buy will risewhen prices rise, the amount people will buy will decreasewhen prices rise, the amount people will sell will risewhen prices rise, the amount people will sell will decrease
- 5. Multiple ChoiceThe law of supply statesWhen prices rise, producers will want to produce moreWhen prices rise, producers will want to produce lessWhen producers producer more, they expect to make less moneyWhen producers producer less they expect to make more money
- 6. Multiple ChoiceEquilibrium isThe point at which there is a shortage of a good or serviceThe point at which there is surplus of a good or serviceThe point at which the amount people are buying at a certain price is equal to that which people are sellingThe point at which people are buying are as high as possible and the sellers are selling for equal prices so there is choice
- 7. Multiple Choice
What do businesses generally do when demand for a product decreases?
Decrease the price
Increase the price
Keep the price the same
Produce more
- 8. Multiple ChoiceAccording to the principles of supply and demand, if the price of Coke rises we would expect thatPeople will buy more CokeProducers will produce less CokePeople will buy more PepsiProducers will produce less Pepsi
- 9. Multiple ChoiceIf the cost of labor to make steel increases, according to the laws of supply and demand the supply for steel wouldincreasedecreasestay the same but demand would increasestay the same but demand would decrease
- 10. Multiple Choice
In a free market, one can expect a company to charge the highest possible prices they can to make the most money due to
Competition
Voluntary exchange
The Profit motive
The existence of Private property
- 11. Multiple Choice
All of the following contribute to a free market system except
Economic freedom
Competition
Self-Interest
Government ownership
- 12. Multiple Choice
Which broad social goal is important in a market system but not as important in a centrally-planned (command) one?
Equity
Efficiency
Security
Stability
- 13. Multiple Choice
Which economic system relies solely on the government to produce and distribute goods and services?
Market
Centrally-planned (command)
Capitalism
Mixed
- 14. Multiple Choice
Which actions would a coffee producer most likely take in response to a increase in the price it can charge for coffee
Produce more coffee
Produce less coffee
Do nothing
None of the above
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