Economics Unit 1

Which of the following represents fundamental reasons as to why all poverty relief programs that create or perpetuate dependence, reward sloth, or level those who work hard along with those who hardly work at all fail?

- Such poverty programs do not actually enable recipients to exercise godly dominion. -Typically, such programs focus too much on the power and prestige of the givers and benefactors who have the tendency to dominate and oppress recipients. -This is because such programs strike at the heart of what it means to be human—to bear the image of God.

What exactly is "the division of labor" which Adam Smith and Leonard Read refer to?

- The division of labor refers to a division of very complex productive efforts into much simpler tasks which a multitude of individuals perform for purposes of production. - The division of labor refers to a variety of labor capacities distributed among a multitude of people with differing degrees of skills.

According to Madison, what sort of property is considered to be most valuable?

According to Madison, the most sacred form of property is a man's conscience.

The Axiological dilemma deals with what life-question in a final way?

Axiology attempts to deal with issues of ultimate value.

James Madison quotes from Sir William Blackstone's Commentaries on the Laws of England and specifically that section which established the origin of property from Genesis 1:28. Which of the following does not model Blackstone's use of this passage?

Blackstone understood Genesis 1:28 as God granting man the authority to do whatever he wanted with creation. Though God created, he left His creation to man to dispose of in whatever manner he saw fit.

What is covetousness?

Covetousness is the inordinate longing for the wealth of others and its gain through unjust means.

What is Leonard Read's main point in "I Pencil"?

Economics cannot be planned, as no one possesses all the necessary knowledge and skills to produce even a simple pencil.

According to COR, what is Economics?

Economics is the study of the principles and methods of allocating scarce resources to achieve optimal production, distribution, and consumption of wealth.

The Epistemological dilemma deals with what life-question in a final way?

Epistemology asserts ultimate answers to the question "How can I know what is true?"

According to Ewert, the Christian left asserts that free-markets are based upon and encourage an ethic of selfishness. How does Ewert counter this?

Ewert has discerned that though the "free market does allow '"self-directed" actions, it does not require "selfish" economic actions."' The market itself does not require an attitude of selfishness to direct the production and sale of goods and services.

Which of the following is not true relative to the Christian left's moral indictment of the free market?

Free markets actually encourage the formation and maintenance of the most basic human community, such as the family. The right to private property, which free markets require, is vitally connected to the integrity of the family unit.

Which of the following is not a characteristic of the free market?

Government Coercion

Where does the right to the ownership of private property originate, and which British common law recognized?

Its origination is recorded in Genesis 1:28: God establishes a general grant of dominion to all mankind and can lawfully do so because He owns all the earth

Milton Friedman concludes Read's "I Pencil" and mentions Adam Smith's comments about an "invisible hand," which Read emphasized. Read the following quote by Smith found in his The Theory of Moral Sentiments (1759) and then answer the following question: Every individual... neither intends to promote the public interest, nor knows how much he is promoting it... he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. What does Smith mean by this "invisible hand" which Friedman and Read both highlight?

Labor cooperation and production is possible without government coercion.

What does Read mean when he uses the term "master mind" when explaining the operation of free markets?

No one person or civil authority is dictating market operations; no "master mind" exits.

All worldviews must answer four philosophical dilemmas, each of which addresses a life concern in a final way. What does the Ontological question attempt to address in a final way?

Ontology attempts to provide final answers to questions of origins, or the ground of being and existence.

Which of the following is incorrect, biblically, in regards to the nature, definition, or characterization of property?

Property, properly speaking, can be isolated to the ownership of external, tangible, and taxable things.

___________develops when individuals are all acting according to individual plans, as just the right amount of goods and services become readily available. This process also requires tremendous __________. as no central planner is needed to make certain that items come into existence.

Spontaneous order and coordination

The Teleological dilemma deals with what life-question in a final way?

Teleology attempts to provide final answers to questions of purpose and destiny.

What is meant by the phrase "institutional structure and procedure of life"?

The "institutional structure and procedure of life" is the total societal and relational expression of answers to all the basic questions in life.

Ewert points out that the so-called secular left appears to have moderated its opposition to free markets based upon pragmatic as opposed to philosophical reasons. Nevertheless, the "Christian left" is still much less influenced by the demonstrated failure of state-directed economic policies. According to Ewert, why is this the case?

The Christian left appears to prioritize the moral superiority of socialism—they are convinced that capitalism must be judged on its 'moral' merits and, in comparison to socialism, it is far more immoral.

According to Madison, what is the primary purpose of civil-government?

The primary purpose of government is the protection of man's property in both its external and internal forms, a man's rights relative to his property and the property a man has in his rights.

Which of the following best identifies the economic term alternative uses?

This term means that available resources have innumerable uses.

According to Reverend Sirico, we must make some rather "crucial distinctions" which will assist us in understanding the connection between morality and economic liberty more adequately. A series of such distinctions are presented below. Which one of the following will assist us in this endeavor?

a distinction between rights and privileges

According to Reverend Sirico, "To ensure that free markets are preserved as much as possible by our public policies, . . . we must provide ________

a robust explanation of their moral value."

According to Madison, governments are not just, nor property secure under it when

all of these are correct

In considering a biblical worldview statement on property, which of the following affirms the ownership of property from the Scriptures?

all these correct

Fill in the appropriate blanks: The principle of property, linked to individuality, issued forth in an equality of civil protection for liberty of _____________and the necessary freedoms to pursue ________and religious duties owed to God and neighbor. Such duties include charity and private philanthropy.

conscience and moral

Which economic system rewards people according to the intelligence, creativity, and diligence of their work?

free-market system

What is the Biblical perspective on economics?

freedom of enterprise and righteous stewardship of private property

Which of the following is not a moral criteria of the free market or a necessary part of the ethical foundations of Economics?

good intentions

Underlying the Christian view of economics is:

man made in God's image

The free market is moral because it's based on merit. Individuals are rewarded when they produce goods and provide services that people want. The free market requires that you think about others and their needs and attempt to please them. This is also referred to as the ________________.

morality of the market

The ________ ________ coordinates the interaction between supply and demand.

price system

The division of labor results in an increase in the amount of work done. Which of the following is not a circumstance which promotes such productivity?

the intervention of civil-government to coordinate production efforts

According to Sowell, which of the follow best summarizes the study of economics?

the use of scarce resources which have alternative uses

Market transactions only occur if both parties or all parties benefit from the exchange. This ________ ________ would not occur if one party was being exploited at the expense of the other party—both parties benefit and are wealthier because of the exchange.

voluntary exchange