Chapter 4 - The Nature of Capitalism
Which statement best describes capitalism
Capitalism is an economic system that operates under the profit motive.
T or F: According to Adam Smith, the division of labor decreases economic activity.
False
T or F: According to a socialist, the best economic system would be one where the means of production and distribution are in the hands of the bourgeoisie.
False
T or F: Capitalism is possible without private property
False
T or F: If it's true that individuals have a natural right to own property, then there can be no limits on this right.
False
T or F: None of the specific measures proposed by Marx and Engels in the Communist Manifesto have been implemented in capitalist countries
False
T or F: The U.S. trade deficit has shrunk significantly in recent decades
False
T or F: The capitalism that we know today in the United States is a "pure" form of laissez-faire capitalism.
False
Which statement accurately describes capitalism?
In state welfare capitalism the government plays an active role in regulating economic actives in an effort to smooth out the boom-and-bust pattern of the business cycle.
Which of the following accurately reflects the concept of Marxism?
Labor is alienated in a capitalist economic system (in part) because the labor of a work stands opposed to the worker as an autonomous power.
Which of the following historical stages of capitalism came first?
Mercantile
T or F: According to Marx, When workers are alienated they are not truly free.
True
T or F: Adam smith claims that the people seeking self-interest in a free market through competition can benefit society as a whole
True
T or F: Capital is that money that is invested for the purpose of making more money
True
T or F: Government programs often subsidize American businesses and protect them from competition.
True
T or F: Implicit in capitalism is the view that human beings aim to maximize their economic self-interest.
True
T or F: Outsourcing is a practice where companies buy parts or whole products from other producers, both at home and abroad.
True
T or F: Property ownership involves a generally complex bundle of rights and rules governing how, under what circumstances, and in what ways both the owner and others can use, possess, dispose of, and have access to the thing in question.
True
T or F: Socialism is an economic system characterized by public ownership of property and a planned economy
True
T or F: Socialism is an economic system characterized by public ownership of the means of production and distribution, and a planned economy.
True
T or F: The sense of private property that is central to capitalism is the ownership of the means of production and distribution.
True
T or F: What we call capitalism did not fully emerge until the Renaissance in Europe during the 15th and 16th centuries.
True
A basic premise of Adam Smith's invisible hand argument is
We often get what we want from others by offering something they need from us.
Some critics of capitalism believe that it rests on a flawed view of human beings because
capitalism assumes that well-being comes from greater material consumption.
Marxism states
capitalism leads to concentration of property and thus a concentration of resources and power in relatively few hands.
A basic tenet of capitalism is that
capitalism requires private ownership of the major means of production.
Karl Marx believed that
capitalist workers suffer from alienation
An exclusive focus on short-term performance
has helped to create a high-pressure environment conductive to fraud.
The fugger dynasty was an example of
mercantile capitalism
The concept of the "invisible hand" means
pursuit of private gain will bring the best overall results
One reason for believing that in practice capitalism fails to live up to its own ideal of competition is
we have government subsides and protective tariffs