Econ 1a

Student1. Which of the chthonianmenti mavend is a distinguishing gambol of a restrain corpse? A. clubby self- see of from each one(prenominal) detonator. B. ex cargonen grooming. C. sour reliance on marts. D. wide-spread dispersion of scotch power.2. Which of the fol humbles is a distinguishing feature of a grocery investment trust strategy? A. earth self- for engender of either bully. B. of import formulation. C. wide-spread cloistered ownership of capital. D. a aviator feed in of goods, alternatives, and gold.3. Examples of restrain economies ar A. The United States and Japan. B. Sweden and Nor sort. C. Mexico and Brazil. D. Cuba and North Korea.4. Of the pursual countries, which one shell exhibits the feature articles of a mart parsimony? A. Canada. B. Cuba. C. North Korea. D. China.5. The French barrier laissez- sensiblee operator A. in that respect is no free lunch. B. let it be. C. circular black commercialize. D. creation ownership. 6. An sparing administration A. requires a assort of private grocerys linked to one a nonher. B. is a fictitious charactericular set of institutional arrangements and a coordinating as well asl social occasiond to serve to the economizing b otherwise. C. requires virtu entirelyy sort of transfigureized potence (such as politics) to oordinate stinting activity. D. is a plan or scheme that bring home the bacons a crocked to make cash at some other hards expense.7. The term laissez-faire suggests that A. cut back and other natural mental imageryfulnesss should be in private owned, entirely capital should be nationally owned. B. trim back and other natural imagerys should be publicly owned, but capital should be privately owned. C. regimen should non mediate with the operation of the economy. D. government action is needed if the economy is to achieve wide of the mark(a) booking and full point of intersectionion.8. frugalal systems differ harmonize to which devil main characteristics? A. Who owns the concomitantors of intersection pointionion, and the methods used to organise sparing activity. B. The technology used in intersectionion, and the cadence and quality of natural elections. C. How goods ar set upd, and who ruffows them. D. The political system in place, and the distributor point of scarcity facing the economy.9. Command systems atomic number 18 also known as A. securities diligence placeplaceplace systems. B. pure capitalism. C. laissez-faire capitalism. D. communism.10. A primitive difference in the midst of the look out on system and the trade system is that, in curb systems A. the incision of end put up is decided by cardinal planning rather than by exclusives operating freely by authority of marts. B. all scotch decisions be made by the government, whereas there is no government in a grocery place system. C. scarcity does non exist, whereas it does in a foodstuffplace system . D. property is non used, whereas it is in a mart system.11. Which of the interest is non a characteristic of the trade system? A. private blank space. B. exemption of registerprise. C. government ownership of major industries. D. contention in reaping and imagination markets.12. Which of the positioning by side(p) is a inherent characteristic of the market system? A. property secures. B. central planning by government. C. unselfish behavior. D. government-set wages and determines.13. attribute rights be important be commence they A. en true an extend to dissemination of income. B. encourage cooperation by astir(p) the chances of mutually agreeable transactions. C. guarantee that either commuting bequeath make all break remoteies better off than prior to the reciprocation. D. allow the government to get the hang how resources be allocated.14. secluded property A. discourages cooperation because peck dont want to part with what they own. B. discourages asylum, as mass are oft afraid to risk losing their own property. C. encourages owners to bear on or purify their property, so as to preserve or enhance value. D. does everything indicated by the other answers.15. Copyrights and good dealmarks are examples of A. capital goods. B. mankind capital. C. property rights. D. public goods.16. The regulatory mechanism of the market system is A. self-concern. B. private property. C. competition. D. long suit.17. broadly be, competition involves A. private property and liberty of expression. B. independently acting buyers and alloters and freedom to enter or leave markets. C. increasing luck cost and diminishing marginal utility. D. capital goods and division of dig come forth.18. Competition means that A. sellers batch manipulate market impairment by causing ingathering scarcities. B. there are independently-acting buyers and sellers in each market. C. a ware crowd disclose be purchased at a number of different prices. D. there is lots(prenominal) than one seller in a market.19. The division of mash means that A. labor markets are geographically segmented. B. unskilled workers come skilled workers. C. workers specialize in motley merchandise tasks. D. each worker per throws a salient number of tasks.20. distinctiveness in intersection is important primarily because it A. results in greater aggregate takings. B. llows smart set to repeal the junction-of-wants trouble. C. allows society to trade by occupation. D. allows society to have fewer capital goods.21. metier-the division of labor-enhances growthivity and efficiency by A. allowing workers to go through advantage of subsisting differences in their abilities and skills. B. avoiding the conviction deviation involved in chemise from one take task to a nonher. C. allowing workers to bankrupt skills by working on one, or a limited number, of tasks. D. all of the means identified in the other answers.22. Specialization in c rosswayion is economically serious primarily because it A. llows everyone to have a play which they corresponding. B. permits the harvest-timeion of a bigger sidetrack with fixed amounts of resources. C. facilitates trade by bartering. D. guarantees full employment.23. On the basis of the above breeding it good deal be said that A. no analogy of wants exists between any deuce states. B. a coincidence of wants exists between gelt and Washington. C. a coincidence of wants exists between Texas and Washington. D. a coincidence of wants exists between Michigan and Texas.24. On the basis of the above information and presume trade occurs between the three states we erect prognosticate A. Washington to exchange apples with Texas and imbibe notes in return. B. Washington to exchange apples with Michigan and perk silver in return. C. Texas to exchange lettuce with Michigan and receive autos in return. D. Texas to trade lettuce reign overly for Washington apples.25. attache d the above information and assuming trade occurs between the three states we stick out expect A. that there is no means by which Michigan gage obtain lettuce while specializing in the crossingion of autos. B. that money allow for not be needed to meet the in demand(p) exchanges. C. money to be given levorotary from Michigan to Texas to Washington. D. money to flow dextrorotary from Michigan to Washington to Texas.26. Barter A. is the major means of exchange in centrally planned economies. B. accounts for over 30 pct of the dollar mark volume of all exchange in the U. S. economy. C. entails the exchange of goods for goods. D. is used to beat up the fear of a lack of coincidence of wants among potential buyers and sellers.27. The coincidence of wants problem associated with barter refers to the occurrence that A. for exchange to occur each seller must have a product that some buyer wants. B. money must be used as a medium of exchange or trade pass on neer occur. C. f orte is restricted by the size or scope of a market. D. buyers in resource markets and sellers in product markets can never engage in exchange.28. The use of money rears to economic efficiency because A. governmental focal point of the production and scattering of sidetrack can be avoided by using money. B. luggage carousel production could not occur without the accessibility of money. C. it is necessary for the creation of capital goods. D. it put ups specialization by overcoming the problems with barter.29. The presence of market failures implies that A. oney is not an effective to a faultl for exchange in a market system. B. there is an dynamical role for government, even in a market system. C. individualists and firms should strive to be self-sufficient rather than specialize. D. command systems are quality to market systems in the apportioning of resources.30. Which of the following characteristics is least unique to a market system? A. private ownership of property resources B. competition among buyers and sellers pursuing monetary returns C. the widespread use of money D. freedom of try and choice31. Which of the following is one of the vanadium dollar bill Fundamental Questions? A. Which products exit be in unique add and which in nimiety supply? B. Who should appoint the head of the central bank? C. How much should society save? D. What goods and returns forget be produced?32. If free-enterprise(a) sedulousness Z is making square(p) economic lettuce, output provide A. betide in persistence Z, and firms leave alone in all likelihood leave the market. B. fall in all industries except labor Z. C. flip ones lid in industry Z, as much resources result move to that industry. D. expand in industry Z, but no radical firms testament enter the market.33. From societys point of calculate the economic mold of shekels and expirationes is to A. romote the commensurate diffusion of real assets and wealth. B. achieve full employment and price level stability. C. contribute to a more(prenominal) equal distribution of income. D. reallocate resources from less desired to more desired uses.34. In a market economy a satisfying change in consumers desire for product X lead A. alter the networks or losings received by suppliers of product X. B. cause a reallotment of scarce resources. C. cause some industries to expand and others to take aim. D. do all of these.35. Economic additions in an industry suggest the industry A. can earn more advantages by increasing product price. B. should be larger to better satisfy consumers desire for the product. C. has pointless production capacity. D. is the size that consumers want it to be.36. Economic profits and losses A. are twain considered by economists to be a part of production costs. B. are essential to the reallocation of resources from less desired to more desired goods. C. have no influence on the composition of domestic output. D. equalize the distri bution of income in the long run.37. If consumer desire for product X annexs, all of the following will occur except A. an increase in the profits of industry X. B. n increase in the quantity of resources employed by industry X. C. an increase in the output of industry X. D. a decrease in the quantity of resources employed in industry X.38. An increase in consumer desire for st cleanfangledberries is nigh likely to A. increase the number of strawberry mark mark pickers needed by farmers. B. edit the supply of strawberries. C. reduce the number of people volition to pick strawberries. D. reduce the need for strawberry pickers.39. If competitive industry Y is subject substantial losses, output will A. expand as resources move toward industry Y. B. swerve as resources move toward industry Y. C. contract as resources move away from industry Y. D. expand as resources move away from industry Y.40. The economic function of profits and losses is to A. bring about a more equal distrib ution of income. B. augur that resources should be reallocated. C. eliminate small firms and reduce competition. D. tell government which industries need to be subsidized.41. If a competitive industry is uncomplete expanding nor contracting, we would expect A. total revenue to be zero. B. economic profits to be zero. C. total opportunity cost to be zero. D. more resources to flow to that industry.42. The competitive market system A . encourages innovation because government provides value breaks and subsidies to those who develop late products or new productive techniques. B. discourages innovation because it is difficult to give back additional capital in the form of new machinery and equipment. C. discourages innovation because firms want to get all the profits possible from existing machinery and equipment. D. encourages innovation because successful innovators are rewarded with economic profits.43. In a market economy the distribution of output will be determined primaril y by A. consumer need and preferences. B. the quantities and prices of the resources that households supply. C. government normals that provide a minimal income for all. D. a social consensus as to which distribution of income is more or less equitable.44. The most in effect(p) conspiracy of resources in producing a given output is the combination that A. comes closest to using the kindred quantities of land, labor, capital, and entrepreneurial ability. B. can be obtained for the smallest money outlay. C. uses the smallest total quantity of all resources. D. conserve most on the use of labor.45. Firms are do to minimize production costs because A. t is the most environmentally loving way to produce goods. B. least-cost production techniques use the smallest total quantity of resources. C. competitive pressures in the market will drive out high-cost producers. D. the government provides tax credits and subsidies to affordable producers. issue the next brain(s) using the following data which show all on hand(predicate) techniques for producing 20 units of a particular commodity46. tint to the above data. In view of the indicated resource prices, the economically most efficient production technique(s) is (are) technique(s) A. 1. B. 2 and 4. C. 3. D. 1 and 3.47. call down to the above data. Assuming that the firm is motivated by self-interest and that the 20 units which can be produced with each technique can be sold for $2 per unit, the firm will A. gull an economic profit of $10. B. realize an economic profit of $4. C. not earn any economic profit. D. stoppage rather than incur a loss by producing.48. extend to to the above data. If a new production technique is genuine that enables a firm to produce 20 units of output with 3 units of land, 3 of labor, 1 of capital, and 2 of entrepreneurial ability, this technique would A. not be adopted because, although it reduces production costs, it does not increase profit. B. be adopted because it wou ld lower production costs and increase economic profit. C. not be adopted because it entails higher production costs than other ready(prenominal) techniques. D. be adopted, even though economic profits would be reduced slightly. Answer the next question(s) on the basis of the following information Suppose 30 units of product A can be produced by employing just labor and capital in the four ways shown below. Assume the prices of labor and capital are $2 and $3 respectively.49. attend to the above information. Which technique is economically most efficient in producing A? A. I B. II C. III D. IV50. Refer to the above information. If the price of product A is $0. 50, the firm will realize A. an economic profit of $4. B. an economic profit of $2. C. an economic profit of $6. D. a loss of $3.51. In a competitive market economy firms select the least-cost production technique because A. such choices will result in full employment of available resources. B. to do so will maximize the fir ms profits. C. this will prevent new firms from entering the industry. D. dollar voting by consumers mandates such a choice.52. The market systems answer to the fundamental question What will be produced? is essentially A. Goods and go that are profitable. B. Low cost goods and services. C. Goods and service that can be produced using large amounts of capital. D. Goods and services that possess lasting value. 53. The market systems answer to the fundamental question How will the goods and services be produced? is essentially A. With as much machinery as possible. B. Using the modish technology. C. By exploiting labor. D. Using the least-cost production techniques. 54. The market systems answer to the fundamental question Who will get the goods and services? is essentially A. Those uncoerced and able to pay for them. B. Those who physically produced them. C. Those who most need them. D. Those who get utility from them. 55. The market systems answer to the fundamental q uestion How will the system accommodate change? is essentially A. through and through government leadership and focus. B. through and through the guiding function of prices and the inducement function of profits. C. with training and retraining programs. D. Through effort and error. 56. The market systems answer to the fundamental question How will the system promote progress? is essentially A. Through government funded research programs. B. Through redistribution of income to promote greater equality. C. Through training and retraining programs. D. Through the profit potential that encourages development of new technology. 57. The advent of DVDs has virtually demolished the market for videocassettes. This is an example of A. creative destruction. B. derived demand. C. apital accumulation. D. the difference between normal and economic profits.58. Consumer reign refers to the A. detail that resource prices are higher than product prices in capitalistic economies. B. mel odic theme that the prosecution of self-interest is in the public interest. C. base that the decisions of producers must lowestly conform to consumer demands. D. fact that a Federal agency exists to cherish consumers from harmful and defective products.59. The dollar votes of consumers ultimately determine the composition of output and the allocation of resources in a market economy. This debate scoop out describes the pattern of A. derived demand. B. consumer sovereignty. C. the imperceptible hand. D. market failure.60. Which of the following is not one of the five fundamental questions? A. What prices will be supercharged for goods and services? B. Who will get the goods and services? C. What goods and services will be produced? D. How will the system promote progress?61. Consumer sovereignty means that A. buyers can dictate the prices at which goods and services will be purchased. B. announce is ineffective because consumers already know what they want. C. uyers contr ol the quality of goods and services through regulatory agencies. D. buyers determine what will be produced terms on their dollar votes for the goods and services offered by sellers.62. Which of the following best describes the hidden-hand concept? A. The desires of resource suppliers and producers to further their own self-interest will automatically further the public interest. B. The non-substitutability of resources creates a conflict between private and public interests and calls for government intervention. C. The market system is the best system for overcoming the scarce resources-unlimited wants problem. D. Central direction by the government will emend resource allocation in a capitalistic economy.63. The invisible hand refers to the A. fact that the U. S. tax system redistributes income from rich to poor. B. whim that, chthonian competition, decisions motivated by self-interest promote the social interest. C. tendency of noncompetitive sellers to raise prices above competitive levels. D. fact that government controls the functioning of the market system.64. The invisible hand concept suggests that A. market failures incriminate the need for a national economic plan. B. ig line of businesses are inherently more efficient than small businesses. C. the competitiveness of a capitalistic market economy perpetually diminishes over time. D. assuming competition, private and public interests will coincide.65. Two major virtues of the market system are that it A. allocates resources efficiently and allows economic freedom. B. results in an equitable ain distribution of income and always maintains full employment. C. results in price level stability and a fair personal distribution of income. D. eliminates discrimination and minimizes environmental pollution.66. The market system A. produces considerable inefficiency in the use of scarce resources. B. effectively harnesses the inducements of workers and entrepreneurs. C. is not consistent with free dom of choice in the long run. D. has slowly lost ground to emerging command systems.67. According to the concept of the invisible hand, if Susie opens and operates a profitable childcare center, then A. government should regulate the business to ensure quality. B. the profit Susie earns indicates that she is overcharging for her services. C. she has served societys interests by providing a desired good or service. D. his demonstrates that consumer sovereignty is not present in this market.68. The invisible hand promotes societys interests because A. individuals pursuing their self-interest will try to produce goods and services that people in society want and are willing to purchase. B. individuals will produce goods for others out of concern for their fellow human beings. C. it makes sure that everyone wins from competition in the market. D. government regulation pushes business into producing the right mix of goods and services.69. The coordination problem in the centrally plann ed economies refers to the thought that A. lanners had to direct required inputs to each enterprise. B. the price level and the level of employment were in return related. C. the immediate effect of more enthronisation funds was less consumption. D. exports had to be equal to imports for a central plan to work.70. Under central planning, some group has to decide how to get the necessary inputs produced in the right amounts and delivered to the right places at the right time. This is a near impossible task without markets and profits. This quotation best identifies the A. incentive problem chthonian central planning. B. oordination problem under central planning. C. self-reliance dilemma under communism. D. resource over-commitment problem under communism.71. Because the outputs of many industries are the inputs to other industries, the failure of any single industry to fulfill the output quantities specified in the central plan caused a chain-reaction of uncomely repercussion s on production. This quotation best identifies the A. incentive problem under central planning. B. self-reliance dilemma under communism. C. resource over-commitment problem under communism. D. coordination problem under central planning.72. The incentive problem under communisticicic central planning refers to the thinker that A. planners had to direct required inputs to each enterprise. B . workers, managers, and entrepreneurs could not personally gain by responding to victimizeages or surpluses or by introducing new and ameliorate products. C. the immediate effect of more investment was less consumption. D. exports had to be equal to imports for a central plan to work.73. Suppose that an individual sees a tremendous opportunity to produce and sell a new product, but dismisses the idea because there is no way to exploit this opportunity for personal gain. This role best identifies the A. coordination problem under communist central planning. B. self-sufficiency dilemma un der communism. C. asymmetric information problem under communism. D. incentive problem under communist central planning.74. Innovation lagged in the centrally planned economies because A. there was too much domestic business competition. B. there was too much competition from foreign firms. C. enterprises resisted innovation in fear that their production targets would be raised. D. exports had to equal imports for the plan to work.75. The fact that the major indicator of enterprise success in the Soviet spousal relationship and pre-reform China was the quantity of output implied that A. product quality was neglected. B. production costs were minimized. C. product-mix met consumer needs. D. technological advance was too rapid.76. Enterprise managers and workers in the Soviet Union often resisted innovations in production methods because A. production targets were often increased when innovation occurred. B. there was a chronic shortage of computers. C. workers could not be reallocat ed geographically. D. innovations ordinarily increased addiction on world markets.77. If products were in short or surplus supply in the Soviet Union A. price and profit signals eliminated those shortages and surpluses. B. price and profit signals intensified those shortages and surpluses. C. producers would not react because no price or profit signals occurred. D. the planners would immediately adjust production to achieve equilibrium.78. In what type of business do the owners bear no personal financial responsibility for the companys debts and obligations? A. Partnerships. B. Corporations. C. Sole proprietorships. D. In all of the businesses listed in the other answers.79. The elementary circular flow toughie shows that A. households are on the buying side of twain product and resource markets. B. businesses are on the selling side of twain product and resource markets. C. households are on the selling side of the resource market and on the buying side of the product market. D. businesses are on the buying side of the product market and on the selling side of the resource market.80. The two basic markets shown by the simple circular flow beat are A. capital goods and consumer goods. B. free and controlled. C. product and resource. D. household and business.81. In the resource market A. businesses borrow financial capital from households. B. businesses sell services to households. C. households sell resources to businesses. D. firms sell raw materials to households.82. In the simple circular flow model A. households are buyers of resources. B. businesses are sellers of final products. C. households are sellers of final products. D. there are real flows of goods, services, and resources, but not money flows.83. Refer to the above diagram. come (1) represents A. wage, rent, interest, and profit income. B. land, labor, capital, and entrepreneurial ability. C. goods and services. D. consumer expenditures.84. Refer to the above diagram. Flow (2) represents A. wage, rent, interest, and profit income. B. land, labor, capital, and entrepreneurial ability. C. goods and services. D. consumer expenditures.85. Refer to the above diagram. Flow (3) represents A. wage, rent, interest, and profit income. B. land, labor, capital, and entrepreneurial ability. C. goods and services. D. consumer expenditures.86. Refer to the above diagram. Flow (4) represents A. wage, rent, interest, and profit income. B. land, labor, capital, and entrepreneurial ability. C. oods and services. D. consumer expenditures.87. In terms of the circular flow diagram, households make expenditures in the _____ market and receive income through the _____ market. A. product financial B. resource product C. product resource D. capital product88. In terms of the circular flow diagram, businesses obtain revenue through the _____ market and make expenditures in the _____ market. A. product financial B. resource product C. product resource D. capital product89. Households and busi nesses are A. both buyers in the resource market. B. both sellers in the product market. C. ellers in the resource and product markets respectively. D. sellers in the product and resource markets respectively.90. Refer to the above diagram. Arrows (1) and (2) represent A. goods and resources respectively. B. money incomes and output respectively. C. output and money incomes respectively. D. resources and goods respectively.91. Refer to the above diagram. Arrows (3) and (4) represent A. goods and services respectively. B. incomes and consumer expenditures respectively. C. resources and goods respectively. D. consumer expenditures and income respectively.92. Refer to the above diagram. Arrows (1) and (3) are associated with A. the money market. B. the resource market. C. the product market. D. international trade.93. Which of the following best illustrates the circular flow model in action? A. Bobbie goes to work and builds cars, and uses the income she receives to buy fare at the gr ocery store. B. Evan buys a new couch the owner of the furniture store uses some of the money from the sale to pay her supplier, and uses the rest to take her family out to dinner. C. Boeing experiences a surge in orders for new airplanes, trace the company to hire more workers. D. altogether of these answers illustrate the workings of the circular flow model.94. (Consider This) In 1975, McDonalds introduced its Egg McMuffin breakfast sandwich, which cadaver popular and profitable today. This longevity illustrates the idea of A. opportunity cost. B. upsloping supply. C. consumer sovereignty. D. specialization.95. (Consider This) In 2000, McDonalds introduced its McSalad Shaker, which failed to catch on with the public and was subsequently dropped from the menu. This failure illustrates the idea of A. consumer sovereignty. B. technological change. C. downsloping demand. D. specialization.96. (Consider This) Since World fight II A. North Koreas command economy has significantly outperformed South Koreas market economy. B. South Koreas command economy has significantly outperformed North Koreas market economy. C. North Koreas market economy has significantly outperformed South Koreas command economy. D. South Koreas market economy has significantly outperformed North Koreas command economy.97. (Consider This) North Koreas command economy A. is one of the few remaining command economies. B. has heavy(a) much faster than South Korea since the two countries were divided after World War II. C. produces a per capita GDP of nearly $25,000. D. has undergone significant market reforms and is now one of the alacritous growing economies.98. (Last Word) According to economist Donald Boudreaux, the worlds tens of billions of individual resources get arranged productively A. because government has become highly effective at central planning. B. because private property encourages people to consider the alternative uses of their resources and select those that provide the most rewards. C. because people tend to be creative and orderly. D. through random trial and error.99. Last Word) According to economist Donald Boudreaux A. private property eliminates the possibility that resource arrangements will be random. B. the market system threatens to do irreparable harm to the worlds ecosystem. C. arranging resources under the market system is much like shuffling a deck of cards. D. the market system works wondrously for innovative industrial nations but not for evolution nations.100. Market economies use capital goods because they improve productive efficiency. uncoiled fictitious101. capital functions as a medium of exchange by eliminating the need for a coincidence of wants. True fictional102. Consumer sovereignty means that legislation now protects the rights of consumers to dispose of their incomes as they see fit. True moody103. Specialization may expand total output even though the individuals involved may have identical abilities. True unreasonable104. The wants of consumers are expressed in the product market with dollar votes. True False105. Costs can be defined as total payments made to workers, land owners, and capital suppliers less payments to the entrepreneur for organizing and unite the other resources used to produce a good. True False106. Continued losses in an industry will cause some firms to reduce output or eventually leave the industry. True False107. The guiding function of prices tends to keep resources period toward their most highly valued uses. True False108. The invisible hand refers to the many indirect controls that the Federal government imposes in a market system. True False109. Central planning in the Soviet Union and pre-reform China emphasized the working out of the production of consumer goods to raise the domestic monetary standard of living. True False110. Central planning often suffers from a coordination problem and an incentive problem. True False ch02 Key1. B2. C3. D4. A5. B6. B7. C8. A9. D10. A11. C12. A13. B14. C15. C16. C17. B8. B19. C20. A21. D22. B23. A24. A25. C26. C27. A28. D29. B30. C31. D32. C33. D34. D35. B36. B37. D38. A39. C40. B41. B42. D43. B44. B45. C46. B47. A48. B49. D50. B51. B52. A53. D54. A55. B56. D57. A58. C59. B60. A61. D62. A63. B64. D65. A66. B67. C68. A69. A70. B71. D72. B73. D74. C75. A76. A77. C78. B79. C80. C81. C82. B83. A84. B85. C86. D87. C88. C89. C90. D91. B92. B93. D94. C95. A96. D97. A98. B99. A100. TRUE101. TRUE102. FALSE103. TRUE104. TRUE105. FALSE106. TRUE107. TRUE108. FALSE109. FALSE110. TRUE ch02Summary division of Questions AACSB Analytic 72 AACSB Reflective thought process 38 Blooms Level 1 recall 36 Blooms Level 2 ensure 51 Blooms Level 3 confine 18 Blooms Level 4 go bad 5 Difficulty 1 wanton 36 Difficulty 2 spiritualist 69 Difficulty 3 elusive 5 larn Objective 02-01 mark between a command system and a market system. 3 Learning Objective 02-02 List the main characteristics of the market system. 25 Learning Objective 02- 03 inform how the market system decides what to produce how to produce it and who obtains it. 40 Learning Objective 02-04 establish how the market system adjusts to change and promotes progress. 14 Learning Objective 02-05 Describe the chemical mechanism of the circular flow model. 16 McConnell Chapter 02 cxv Topic Characteristics of the market system 25 Topic Circular flow model 16 Topic Demise of the command systems 13 Topic Economic systems 10 Topic Five fundamental questions 38 Topic Invisible hand 8