Question

1. consumers are known to have sovereignty over the market because they can influence the production of and sale of goods by

a. saving their money.
c. paying off their debts.
b. “voting” with their dollars.
d. reducing their spending habits.

1. which of these is a major advantage of a market economy?

a. people are likely to be offered goods and services they cannot afford.
b. there is efficient government control of production and distribution.
c. it can change direction rapidly as needed when markets change.
d. there is a high degree of individual freedom.

1. what type of economy is most prevalent in the world today?

a. market
c. command
b. traditional
d. mixed

1. three - synonymous terms to describe the u.s. economic system are free enterprise, capitalism, and

a. free command.
c. economic freedom.
b. free market.
d. competition.

1. the minimum wage is an example of a federal law that supports

a. economic growth.
c. full employment.
b. economic efficiency.
d. economic equity.

1. which of the following is not considered an economic and social goal?

a. economic efficiency
c. entrepreneurship
b. price stability
d. economic growth

1. which of the following states an advantage of a traditional economy?

a. economic freedom to choose your own path in society
b. everyone knows exactly what their role is
c. creativity is rewarded
d. low living standards

1. according to adam smith, resources for production is coordinated as if by

a. a government degree.
c. majority rule.
b. an invisible hand.
d. a court ruling.

1. the struggle among sellers to attract consumers by offering the best products at the lowest price is called

a. voluntary exchange.
c. private property.
b. profit motive.
d. competition.

1. protections from layoffs, illnesses, injuries or disabilities falls under the goal of

a. economic security.
c. economic efficiency.
b. economic growth.
d. economic freedom.

1. all of the following are disadvantages of free enterprise capitalism except

a. growing gaps between rich and poor
b. large “supply - side” tendencies
c. uneven economic growth
d. the government plays a minimal role in the economy

Explanation:

1. Consumers influence production by "voting" with their dollars, meaning they choose which goods to buy.
2. A major advantage of a market economy is high - individual freedom.
3. The most prevalent economy type today is the mixed economy.
4. Synonyms for the U.S. economic system are free enterprise, capitalism, and free market.
5. The minimum wage supports economic equity by setting a floor for workers' pay.
6. Entrepreneurship is not an economic and social goal like efficiency, stability, and growth.
7. In a traditional economy, everyone knows their role.
8. Adam Smith proposed the "invisible hand" coordinates production resources.
9. Sellers' struggle to attract consumers is competition.
10. Protections from layoffs etc. are part of economic security.
11. The government playing a minimal role is not a disadvantage of free - enterprise capitalism; it's often seen as an advantage by some.

Answer:

1. b. "voting" with their dollars
2. d. there is a high degree of individual freedom
3. d. mixed
4. b. free market
5. d. economic equity
6. c. entrepreneurship
7. b. everyone knows exactly what their role is
8. b. an invisible hand
9. d. competition
10. a. economic security
11. d. the government plays a minimal role in the economy