QUESTION “Not all democracies are free, as some still restrict certain political and civil liberties.” Which of the following countries best fits this argument? A. Australia B. United States C. Great Britain D. Russia E. Canada ANSWER D Not all democracies are free, according to Freedom House, because some democracies still restrict certain political […]
QUESTION Which of the following creates an unfavorable environment for innovations and entrepreneurship? A. Market economy B. Economic freedom C. State monopoly in production D. Privatization E. Strong legal protection of property rights ANSWER C In a planned economy, the state owns all means of production. Consequently, entrepreneurial individuals have few economic incentives to […]
QUESTION According to the author Francis Fukuyama, the world is most likely witnessing the end of: A. free market economies. B. capitalism. C. liberal democracies. D. privatization. E. humanity’s ideological evolution. ANSWER E Author Francis Fukuyama has argued, “We may be witnessing . . . the end of history as such: that is, the […]
QUESTION Which of the following creates an environment that is conducive to product and process innovations and to entrepreneurial activity? A. Communism B. Centrally planned economy C. Privatization D. Command economy E. Lack of strong property rights ANSWER C Economic stagnation occurred in many mixed economies in those sectors where the state had a […]
QUESTION The collapse of communism will result in the new world order that will be dominated by a universal civilization characterized by democratic regimes and free market capitalism, according to: A. Amartya Sen. B. Samuel Huntington. C. Jeffrey Sachs. D. Francis Fukuyama. E. Adam Smith. ANSWER D Author Francis Fukuyama has envisioned a more […]
QUESTION Only a totalitarian regime that is committed to which of the following is capable of promoting economic growth? A. A command economy B. A dictatorship C. Limiting human freedom D. A market system and strong protection of property rights E. Limiting individualism and privatization ANSWER D Only a totalitarian regime that is committed […]
QUESTION Due to strong legal protection of property rights, businesses and individuals will: A. invest more in innovations. B. face a huge burden from excessive taxation. C. face more corruption. D. move away from entrepreneurial activity. E. run the risk of their profits being expropriated. ANSWER A Strong legal protection of property rights is […]
QUESTION Which of the following measures the total annual income received by residents of a country and is regarded as a yardstick for the economic activity of a country? A. Income elasticity of demand B. Cash reserve ratio C. Net cash flow ratio D. Gross national income E. Income equity ratio ANSWER D GNI […]
QUESTION In 2012, if the PPP per capita of China was $9,040 and the PPP per capita of the United States was $52,340, this means that the: A. GNI per capita was greater in China. B. percent of goods and services consumed in the United States was lower. C. standard of living in China was […]
QUESTION Which of the following statements is true of purchasing power parity (PPP)? A. PPP figures can be misleading because they don’t consider differences in the cost of living. B. The PPP for different countries is adjusted (up or down) depending upon whether the cost of living is lower or higher than in Great Britain. […]
