Chapter 2 The Global Economic Environment

1
Self-Test Questions

• A(n) ________________ economic system is one that
  
• relies upon consumers to allocate resources.
• a)BEM
• b)command resource allocation
• c)OECD
• d)market resource allocation

2
Self-Test Questions
2. An economic system in which resources are
allocated by market forces but are
predominantly under state ownership is known
as a) market capitalism b)
centrally-planned capitalism c) market
socialism d) centrally-planned socialism
3
Self-Test Questions
3. Which of the following best describes
low-income countries a) high percentage
of population engaged in agriculture b) heavy
reliance on foreign aid c) political
instability d) high birth rates e) all of
the above
4
Self-Test Questions
4. The _____________ is a record of all economic
transactions between the residents of a
country and the rest of the world. a)
G7 b) merchandise trade surplus or deficit
c) OECD d) balance of payments
5
Self-Test Questions
5. The theory that a dollar buys the same amount
of goods in various countries when converted
into local currencies at prevailing rates
is a) balance of payments b) the gold
standard c) purchasing power parity d)
hedging