Chapter Two: Differences in Political Economy

d. Market

In a pure _____________ economy, all productive activities are owned privately — not by the state. a. Planned b. Command c. Mixed d. Market

d. The government

Public action to violate property rights exists when ______________ is responsible for the action. a. Big business b. The consumer c. Organized crime d. The government

a. Contract

A(n) _____________ is a document that specifies the conditions under which an exchange is to occur, detailing the rights and obligations of the involved parties. a. Contract b. Subpoena c. Affidavit d. Writ

d. Trademark

A(n) _____________ is a recognizable sign, design or name, often officially registered, that identifies products or services from a particular source. a. Abridgment b. Copyright c. Patent d. Trademark

FALSE! REASON: Experience demonstrated that state ownership of the means of production ran counter to the public interest.

True or False: History shows that state ownership of the means of production never ran counter to the public interest.

c. Civil

A ______________ law system is based on a detailed set of laws organized into codes. a. Tribal b. Common c. Civil d. Theocratic

b. Liability

Product ___________ is the area of law that holds a firm and its officers responsible for injuries caused by their product. a. Security b. Liability c. Diversity d. Surety

c. Allotment of resources for the overall good of society

What is the objective of a pure command economy? a. Abolition of state ownership b. Privatization of state-owned enterprises. c. Allotment of resources for the overall good of society

c. Democracy

________________ refers to a political system in which the citizens exercise power directly or elect representatives to form a governing body. a. Oligarchy b. Totalitarianism c. Democracy d. Monarchy

c. Private

Property rights violation that occurs through theft or piracy is an example of _______________ action a. Command b. Public c. Private d. Market

a. Legal

The ________________ system of a country refers to the rules, or laws, that regulate behavior along with the system that enforces them. a. Legal b. Civil c. Economic d. Political

c. Political economy

The term ___________________ is used to stress that the political, economic, and legal systems of a country are connected. a. Commercialization b. Gross domestic product c. Political economy d. Collectivism

a. Foreign Corrupt Practices Act

Which law makes it illegal to bribe a foreign government official to obtain or maintain business over which that foreign official has authority? a. Foreign Corrupt Practices Act b. NAFTA c. CAFTA d. International Intentions Act

b. Jude, a musician who is composing his maiden album

Which one of these individuals should apply for a copyright? a. Keith, a scientist who is formulating a new pharmaceutical drug b. Jude, a musician who is composing his maiden album c. Jack, an engineer who is building a supersonic jet d. Amanda, an entrepreneur, who owns a chain of department stores.

b. Individualism

________________ refers to a philosophy that promotes the free exercise of one's goals and desires in economic and political pursuits. a. Communism b. Individualism c. Collectivism d. Totalitarianism

b. Command

The three broad types of economic systems include a market economy, a mixed economy and a(n) _________________ economy. a. Concept b. Command c. Control d. Compound

c. Copyright

A ___________ refers to a legal right that enables the creator of an original work the right to publish and distribute their work as they see fit. a. Disclaimer b. Patent c. Copyright d. Trademark

b. Patent

A _______________ grants an inventor exclusive rights for a defined period to the manufacture, use, or sale of his or her invention. a. Watermark b. Patent c. Copyright d. Trademark

c. The interaction of supply and demand.

In a pure market economy, production of goods is determined by a. The reigning government body. b. Availability of resources from outside suppliers. c. The interaction of supply and demand. d. Monopolistic firms.

a. Representative

In a(n) ______________ democracy, elected representatives represent the citizens and make decisions on behalf of the electorate. a. Representative b. Totalitarianism c. Elite d. Common

d. A strategy of revolutionary action.

In the early 20th century, communists differed from social democrats in that communists believed in a. Encouraging individual freedom. b. Establishment of non-totalitarian society. c. Commitment to democratic means. d. A strategy of revolutionary action.

a. Common

A country that bases its law on the traditions within the country's legal history operates under a _____________ law legal system. a. Common b. Tribal c. Civil d. Theocratic

c. Private

Organized crime, such as the "Russian Mafia" that existed following the collapse of communism in Russia and extorted money from businesses is an example of _______________ action. a. Command b. Market c. Private d. Public

d. Contract

The body of law that governs oral and written agreements associated with the exchange of goods, services, money and property is known as ___________ law. a. Character b. Common c. Civil d. Contract

d. Property

The legal rights regarding the use of a resource by a business or individual are known as _____ rights. a. Convention b. Public c. Common d. Property

FALSE! Reason: BOTH the economic and legal system ARE influenced by the prevailing political system.

True or False: Unlike the economic system of a country, the legal system is NOT influenced by the prevailing political system.

c. It is a political system in which rulers govern based on religious rules and principles.

Kent needs to describe theocratic totalitarianism to his classmates. Which of these statements should be use? a. It is political system that strongly advocates private ownership of the basic means of production, distribution, and exchange. b. It is a political system in which a party, group, or individual that represents the interests of a particular tribe monopolizes political power. c. It is a political system in which rulers govern based on religious rules and principles.

b. Intellectual

Michael wrote a screenplay and he is traveling to Los Angeles next week to pitch his idea to a movie studio. The screenplay is an example of ___________ property. a. Theocratic b. Intellectual c. Civil d. Facilitating

d. Patent.

Peter, a research associate at a biotechnology firm, develops a diagnostic kit for the rapid detection of malaria. In order to prevent his competitors from duplicating his invention, Peter should apply for a a. Trademark b. Watermark c. Copyright d. Patent.

d. Property

Sharon's company developed a new method for sealing medication bottles and has decided to license their patented method to the leading drug manufacturers in the United States. Sharon's company has the legal right to do this based on the _________ rights they have for this method. a. Common b. Civil c. Capital d. Property

b. The United States

The Foreign Corrupt Practices Act was established in the 1970s following the revelation that companies in _____________________ had bribed government officials in foreign countries as an attempt to win lucrative contracts a. China b. The United States c. South Africa d. Russia

b. Paris Convention for the Protection of Industrial Property

The members of the World Intellectual Property Organization have signed international treaties designed to protect intellectual property, including the oldest such treaty known as the ____________, which dates to 1883. a. Washington Treaty on Intellectual Property in Respect of Integrated Circuits b. Paris Convention for the Protection of Industrial Property c. World Intellectual Property Organization Copyright Treaty d. Singapore Treaty on the Law of Trademarks.

TRUE Reason: Communism is in decline worldwide and most of the Communist Party dictatorships have collapsed since 1989.

True or False: Communism is in decline worldwide.

a. Capitalists take the value created by workers for their own use.

What is an accurate depiction of Karl Marx's arguments on socialism? a. Capitalists take the value created by workers for their own use. b. Individual capitalists rather than state-owned enterprises benefit the society as a whole. c. In a capitalist society, many people benefit at the expense of a few. d. State-owned enterprises pay workers lower wages.

c. Typically, the political system of a country can be assessed by the degree to which it is democratic or totalitarian

Which statement best exemplifies a political system? a. Typically, countries that support communism stress the primacy of individual freedom over the "good of society." b. Typically, the political system of a country has no influence over its economic and legal systems. c. Typically, the political system of a country can be assessed by the degree to which it is democratic or totalitarian

a. Collectivism

______________ refers to a political system that values the needs of society over that of an individual. a. Collectivism b. Monarchy c. Plutocracy d. Individualism

c. Privatization

_______________ refers to the process of selling state-owned enterprises to private investors. a. Customization b. Depersonalization c. Privatization d. Commercialization

c. The military

________________ often back(s) right-wing totalitarianism governments. a. Democrats b. Big business c. The military d. The church.

d. Mixed

In a _____ economy, both private enterprise and some state monopoly co-exist. a. Planned b. Command c. Market d. Mixed

FALSE Reason: According to Marx, the pay of workers in a capitalist society DOES NOT reflect the full value of their labor.

True or False: According to Karl Marx, the pay of workers in a capitalist society reflects the full value of their labor

b. The individual

According to individualism, economic interests should be dictated by _______________. a. The government b. The individual c. Supply and demand d. Promotion and policy.

a. Communist

Based on the political party beliefs of the governments of China and North Korea, these countries practice _____________________ totalitarianism. a. Communist b. Democratic c. Theocratic d. Right-wing

d. The pure form of democracy believes that laws and policies should be made directly by citizens.

Carrie's professor asked her to describe democracy. Which of these statements should she use? a. The pure form of democracy is based on a belief that "the good of society" can be achieved only through revolution. b. In a representative democracy, basic civil liberties are often denied to citizens. c. In a representative democracy, political repression is often widespread. d. The pure form of democracy believes that laws and policies should be made directly by citizens.

b. Mixed

During the economic downturn of 2008-2009, the U.S. government "bailed out" AIG to prevent that financial institution from collapsing because it felt that if AIG collapsed, it would lead to serious consequences for the entire U.S. financial system. By helping out this troubled firm because it appeared vital to national interests, the U.S. government was acting as a _______________ economy. a. Market b. Mixed c. Command d. Pseudo

c. Public

Governments that levy excessive taxes or require expensive permits from property holders are both examples of ___________ action. a. Market b. Command c. Public d. Private

c. Stresses that the interests of the people are more important than the interests of the state

If you needed to describe the concept of individualism, you would say that individualism a. Often tends to support a totalitarian political system in order to achieve the needs of the society as a whole. b. Advocates the communal property is more highly productive than private property and thus stimulates progress. c. Stresses that the interests of the people are more important than the interests of the state

b. A common law system has a degree of flexibility that other legal systems lack.

If you were asked to provide a fact about a common law system, what would you say? a. A common law system tends to be less adversarial than a civil law system. b. A common law system has a degree of flexibility that other legal systems lack. c. Judges are not used in a common law system.

d. It is a form of government in which the state recognizes no limits to its authority and strives to regulate all aspects of public and private life.

What statement BEST describes a totalitarian system? a. It is a form of government that typically aims to achieve socialism by democratic means rather than violent revolution or dictatorship. b. It refers to a political system in which government is by the people, exercised either directly or through elected representatives. c. It refers to a political system that typically asserts the primacy of individual economic and political freedom over societal goals. d. It is a form of government in which the state recognizes no limits to its authority and strives to regulate all aspects of public and private life.

b. They believed in achieving socialism through non-violent means.

What statement characterizes social democrats? a. They believed in achieving socialism by emphasizing individual interests over societal goals. b. They believed in achieving socialism through non-violent means. c. They advocated private-ownership of the basic means of production, distribution, and exchange.

a. They are subjected to various forms of protection from country to country.

When considering how intellectual property rights are viewed around the world, it can be said that a. They are subjected to various forms of protection from country to country. b. They are few regulations in place today. c. They are protected and governed by uniform regulations worldwide d. Law enforcing these rights are strictly enforced.

c. African

Which countries have experienced trial totalitarianism rule? a. European b. Asian c. African d. American