Ch 4 Bobby

state welfare capitalism (4th)

government plays an active role in the economy, attempting to smooth out the boom-and-bust pattern of the business cycle through its fiscal and monetary policies

The sense of private property that is central to capitalism is the ownership of the means of production and distribution a. true b. false

a. True

The concept of the "invisible hand" means a. pursuit of private gain will bring the best overall results b. although it can't be seen, the hand of government controls the economy. c. feudalism inevitably gives rise to capitalism d. externalities must be internalized

a. pursuit of private gain will bring the best overall results

Adam Smith claims that the people seeking self-interest in a free market through competition can benefit society as a whole a. true b. false

a. true

Government programs often subsidize American businesses and protect them from competition a. true b. false

a. true

Outsourcing is a practice where companies buy parts or whole products from other producers, both at home and abroad a. true b. false

a. true

Globalized Capitalism (5th)

Capitalism based on international trade and integrated national economies.

Define mercantile Captialism (1st)

Capitalism based on state and commercial interests.

4 key features of capitalism

1. Existence of companies 2. Profit motive 3. Competition 4. Private property

How have manufacturers in the U.S evolved over the years?

America's manufacturing base has dwindled and U.S firms outsource more and more of their operations, and millions of jobs have moved abroad. Manufacturing has leaned toward outsourcing in recent years.

Define Industrial Capitalism (2nd)

Associated with large scale industry, and the emergence of factories after the civil war. Included: Sound financial base, technology for mass production, expanding markets for cheaply manufactured goods, and a large and willing labor force.

Define profit motive

Central to Capitalism; It assumes that economic self interest motivates human beings.

How do economists feel about Outsourcing jobs? How do they think this will affect jobs inside the U.S?

Most mainstream economists are upbeat. They believe that outsourcing jobs increases shareholder wealth and benefits consumers by keeping prices down and that as old jobs move overseas, the economy will create new ones at home.. higher level jobs that add greater product value than the lost jobs did.

One reason for believing that in practice capitalism fails to live up to its own ideal of competition is a. we have government subsidies and protective tariffs b. monopolies control almost all areas of economic life c. so many small companies go bankrupt d. the outsourcing of jobs

a. we have government subsidies and protective tariffs

Which statement best describes capitalism? a. capitalism is an economic system in which the means of production and distribution is in state hands b. capitalism is an economic system that operates under the profit motive c. capitalism is an economic system that dispenses with competition d. capitalism is an economic system where the profits generated belong to the state as a whole

b. capitalism is an economic system that operates under the profit motive

According to Adam Smith, the division of labor decreases economic activity a. true b. false

b. false

Capitalism is possible without private property a. true b. false

b. false

Which of the following historical stages of capitalism came first? a. financial b. mercantile c. industrial d. state welfare

b. mercantile

A basic tenet of capitalism is that a. property refers to only physical objects b. ownership is a simple relationship between a person and the thing owned. c. capitalism requires private ownership of the major means of production d. in the 21st century, capitalism no longer requires capital

c. Capitalism requires private ownership of the major means of production

Which statement accurately describes capitalism? a. industrial capitalism is characterized by pools, trusts, holding companies and an interpenetration of banking, insurance, and industrial interests b. mercantile capitalism emerged in the United States in the period directly following the civil war c. in state welfare capitalism the government plays an active role in regulating economic activities in an effort to smooth out the boom-and-bust pattern of the business cycle d. financial capitalism developed in the period immediately prior to the Renaissance

c. in state welfare capitalism the government plays an active role in regulating economic activities in an effort to smooth out the boom-and-bust pattern of the business cycle

Financial Capitalism (3rd)

characterized by pools, trusts, holding companies, and the interpenetration of banking, insurance, and industrial interests.

A basic premise of Adam Smith's invisible hand argument is a. human beings try to avoid acquisitive behavior b. when people are left to pursue their own economic interests, disaster looms. c. the division of labor, though good for the firm, reduces overall efficiency. d. We often get what we want from others by offering something they need from us

d. We often get what we want by offering something they need from us