European Economics III Question Preview (ID: 39695)

Economic Continued! YUCK!

Which statement is a PRIMARY characteristic of a capitalist system?
a) graduated income tax
b) private ownership of property
c) equal distribution of resources
d) governmental regulation of business

All of these are found in a command economy EXCEPT
a) minimum wage.
b) environmental controls.
c) ownership of corporate stock.
d) government regulation of the economy.

The purpose of the founding of the European Union (E.U.) in 1993 was to
a) prevent the poor from causing a revolution.
b) fight the growing global network of terrorism
c) become an economic power to compete with the Unites States.
d) guarantee the freedom of movement of people, goods, services and capital.

Which of the following is not a factor of economic growth?
a) Natural Resources
b) Human Capital
c) Capital Goods
d) Birth Rate

What is an example of human capital?
a) a paint spraying machine
b) iron ore
c) an oven at a bakery
d) an automobile factory worker

The countries of the European Union place a limit of 5,000, Japanese automobiles allowed to be imported into its member countries per month. What is a likely result of the action?
a) The European Union will fail.
b) The United States will settle the issue.
c) Japan will increase trade with the European Union.
d) Japan will place its own limits on trade with the European Union.

Currently, the foreign exchange rate for all world currencies is
a) a fixed exchange rate, based on the U.S. dollar.
b) a floating exchange rate, based on the U.S. dollar.
c) a fixed exchange rate, based on market forces of supply and demand
d) a floating exchange rate, based on market forces of supply and demand.

How does the geography of the United Kingdom impact trade?
a) Countries are reluctant to trade with a nation that is so far north
b) It is in a part of Europe that cannot be reached during winter months
c) Other nations are too far away and cannot trade with them on a regular basis
d) It can be more expensive to import and export goods because it is an island nation

Why is a system of currency (money) exchange necessary for international trade?
a) Nearly all world currencies are worthless on the world market.
b) Those buying goods on the world market only accept payment in gold and silver.
c) People want to be paid in only US dollars.
d) There must be a way to pay for goods purchased from countries with different types of currencies

As of 2011 the economies of the United Kingdom, Germany, and Russia could be classified as MAINLY
a) command.
b) communist.
c) market
d) traditional.

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