1. we have a mixed economy because ________________. a) we produce guns and

1. we have a mixed economy because ________________.

a) we produce guns and butter

b) we consume domestically produced goods as well as imports

c) we consume both goods and services

d) there is a private sector and a public sector

2. Which is NOT a feature of a free market economic system?

a) competition

b) government planning and regulation

c) the invisible hand

d) the price mechanism

3. Adam Smith believed the best way to promote the public interest was to _______________.

a) have the government produce most goods and services

b) let people pursue their own selfish interests

c) wait for individuals to set out to promote the public interest

d) get rid of the price mechanism

4. A free market economic system does a very good job with respect to ___________________.

a) both equity and efficiency

b) equity but not efficiency

c) efficiency but not eqquity

d) neither equity nor efficiency

5. Which is the most accurate statement?

a) No country could be classified as having a communist economic system.

b) it could be argued that every nation has a mixed economy.

c) the United States is basically a socialist economy.
the Chinese economy is evolving away from capitalism and toward pure communism.