Question $1($Multiple Choice Worth $5$ points$)$

$(01\mathrm{.}02$ LC$)$

Which of the following best restates one of the basic economic questions?

What is the fairest distribution of wealth?

How can constraints be minimized and resources maximized?

What is the most efficient economic system?

Which institutions are worth preserving?

Who should get the scarce resources that are produced?

Question $2($Multiple Choice Worth $5$ points$)$

$(01\mathrm{.}02$ LC$)$

The basic economic questions most directly treat the issue of

resource allocation

constraints

formal education

mixed economies

property rights

Question $3($Multiple Choice Worth $5$ points$)$

$(01\mathrm{.}02$ LC$)$

The "invisible hand" is understood as the

labor required to produce valuable goods and services

set of regulations in a command economy that promote fairness

principle that self$-$interest guides individuals to the general good

bureaucracy that enforces the commands of central planners

institution that divides public and private property

Question $4($Multiple Choice Worth $5$ points$)$

$(01\mathrm{.}02$ LC$)$

Which of the following best describes a command economy?

Resource allocation is left up to individuals and firms.

No central government exists to enforce property rights.

A strong central government commits to the free exchange of goods and services.

Various laws shape and define economic output and distribution goals.

A democratic government plays a very small role in economic activity.

Question $5($Multiple Choice Worth $5$ points$)$

$(01\mathrm{.}02$ LC$)$

What is the key difference between command and market economies?

A market economy places a strong emphasis on a small group holding responsibility for planning production.

A command economy considers private property essential to protect, while a market economy places no value on private property.

The basic economic questions are unaddressed in a market economy.

Households answer the basic economic questions in a market economy, while a group of leaders answer them in a command economy.

A command economy depends much more on the principle of the invisible hand.