Economics (H) Chapter 2 Review Game

Consumers & Entrepreneurs Economies Free Enterprise Economic Goals Consumers & Entrepreneurs Role of Government MISC 10 20 30 40 50 60 70 80 90 100

Economic system where the allocation of scarce resources is determined by ritual, custom, and habit. Traditional Economy A1

Economic system in which a central authority makes most of the economic decisions. Command Economy A2

Profits and Private Property are least associated with: Command Economy A3

Market Economy (Free Enterprise Economy) Economic system in which people and firms act in their own best interests to answer the economic questions. Market Economy (Free Enterprise Economy) A4

When competing against other types of economies, what is the largest disadvantage for a Traditional Economy? This type of economy discourages new ideas and new ways of doing things. A5

In the Inuit Tribe, what role did the successful hunter have in the tribe? He will share the spoils of his hunt to help with the survival of the tribe. A6

Everyone knows which role to play. Concerning the economic question of WHAT, what advantage does a Traditional Economy offer? Everyone knows which role to play. A7

Economic system in which decisions about how resources should be used are made partly by the private sector and public sector. Mixed Economy A8

The economic system of the North Korea and Cuba are a form of: Command Economy A9

The United States is an example of: Mixed Economy A10

Have the willingness and ability to purchase them. In a Market Economy, goods typically go to those who: Have the willingness and ability to purchase them. B1

In a Free Enterprise, why do individuals enter into transactions? Both the buyer and seller enter into a transaction only if both are better off after the transaction. B2

The firm will lose sales, and then go out of business. In a Market Economy, if a firm uses a combination of inputs that does NOT minimize costs, then: The firm will lose sales, and then go out of business. B3

Capitalism is defined as an economic system which: Individuals have ownership of all factors of production B4

In a Market Economy, what is meant by consumers “casting their vote”? Consumers “vote” for products they like by purchasing those products. B5

One distinguishing feature between Capitalist countries and NON-Capitalist countries is that: Capitalist countries have private property rights and non-capitalist countries do not. B6

What would NOT be consistent with Pure Capitalism? Government involvement in economic decisions. B7

B8

B9

B10

What is meant by Economic Freedom? People have the right to choose occupation, employer, products, prices, etc… C1

What is meant by Economic Efficiency? Due to scarcity, resources have to be used in the best ways to maximize their benefits. C2

What is meant by Full Employment? People want their economic system to provide as many jobs as possible. C3

Through the struggle of among sellers, prices are lower for consumers. In a Free Enterprise, how does Competition benefit consumers? Through the struggle of among sellers, prices are lower for consumers. C4

A rise in the general level of prices. INFLATION C5

Federal program of disability and retirement benefits that covers most working people. Social Security C6

Federal program that provides health insurance for persons 65 or older. Medicare C7

Increase in IR, will decrease spending. In order to combat Inflation, how does the Federal Reserve Bank try to combat inflation? Increase in IR, will decrease spending. C8

What is meant by Economic Growth? Growth is needed so people can have more goods and services. C9

C10

What is the role of the Entrepreneur in a Free Enterprise Economy? By being risk-takers, they bring in new products and production methods. D1

Bill Gates Creator of Microsoft D2

Developer of McDonalds Ray Kroc Developer of McDonalds D3

Consumers rule the economy “The Consumer is always right” Consumer Sovereignty Consumers rule the economy “The Consumer is always right” D4

How do consumers determine which products will be produced? Consumers cast “votes” on which products to produce by purchasing them. D5

Created a cosmetic company called Mary Kay Cosmetics Mary Kay Ash Created a cosmetic company called Mary Kay Cosmetics D6

Created a publishing company called Johnson Publishing John Johnson Created a publishing company called Johnson Publishing D7

Madame C.J. Walker Created hair products, and became the first African-American millionaire D8

What do successful entrepreneurs attract? Successful entrepreneurs attract more firms into the market (profits) D9

D10

What is meant by the government being a “protector”? (examples) The government protects citizens from false advertising, unsafe products, and environmental hazards. E1

Food & Drug Administration (FDA) Agency designed to protect consumers from unsafe food and drugs. Food & Drug Administration (FDA) E2

What is meant by the government being a “regulator”? (examples) The government regulated market competition, interstate commerce, communications, banking, and the stock market E3

Environmental Protection Agency (EPA) Agency to help set up laws and regulations to protect the natural resources of the United States. Environmental Protection Agency (EPA) E4

How is the Federal Government considered a “provider”? The government “provides” for the National Defense, Education, Public Welfare E5

Agency that regulates the television and radio industries. Federal Communications Commission (FCC) E6

How is the Federal Government considered a “consumer”? The government is the 2nd largest consuming unit. Purchases all kinds of resources. E7

Securities Exchange Commission (SEC) Agency designed to regulate the stock and bond markets in the United States. Securities Exchange Commission (SEC) E8

Federal Trade Commission (FTC) Agency designed to protect consumers from false or misleading advertising. Federal Trade Commission (FTC) E9

Agency designed to regulate the nuclear industry . Nuclear Regulatory Commission (NRC) E10

“The institutional means by which resources are used to satisfy human wants” is the definition of: Economic System F1

When dealing with creativity, what DISADVANTAGE does a Command Economy create? There is no incentive for people to create new ideas, products, or methods. F2

Free Enterprise Economy Profits and Private Property are most closely associated with: Free Enterprise Economy F3

Someone’s rights end when they interfere with the rights of others. What are the limits of someone’s Private Property Rights in a Free Enterprise system? Someone’s rights end when they interfere with the rights of others. F4

For consumers, what DISADVANTAGE does a Command Economy create? In order to meet the industrial demands, there will be a large cut back on consumer goods. F5

F6

F7

F8

F9

F10

Interpreting Maps

Interpreting Maps