Unit 5: Economics

Question 1

method used by a society to produce goods and services

Answer 1

economic system

Question 2

a gov’t program specifying economic activities

Answer 2

economic plan

Question 3

the way all the income in a country is divided

Answer 3

income distribution

Question 4

problems of command economies

Answer 4

• workers lack incentive
• performance falls short of ideals
• sacrifice individual freedoms in order to pursue society’s goals

Question 5

those who lend money receive these payments

Answer 5

interest

Question 6

knowing the best way to produce a product, cuts waste

Answer 6

economic efficiency

Question 7

government programs that protect people experiencing bad economic conditions

Answer 7

social safety net

Question 8

economic fairness in terms of resource distribution

Answer 8

economic equity

Question 9

the degree of wealth and material comfort available to a person or community.

Answer 9

standard of living

Question 10

all decisions are made by the people, not the government

Answer 10

market economy
or free market economy
or capitalism

Question 11

buyers and sellers exchange things because nobody is self-sufficient

Answer 11

market

Question 12

to sell government owned business to private individuals or groups

Answer 12

privatization

Question 13

List characteristics of a planned economy.

Answer 13

• resources are publicly owned
• gov’t makes decisions on how to use resources
• individual consumers have little influence on economic decision making

Question 14

List characteristics of a mixed economy.

Answer 14

• some resources are publicly owned and some are privately owned
• both individuals and gov’t make decisions about what to produce
• individual consumers and gov’t influence economic decision making

Question 15

List characteristics of a market economy.

Answer 15

• resources are privately owned
• individuals make decisions on how to use resources.
• individual consumers drive economic decision making by choosing what to buy.