LUOA economics: module 1

What exactly is "the division of labor" which Adam Smith and Leonard Read refer to? [choose all that apply]

-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.

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

-The ownership of property cannot be conducted through government coercion. -The ownership of property appears to be a just reward for labor. -The ownership of property appears to result from the receipt of an inheritance or gifts. -The ownership of property assumes that one is to steward property as accountable to God.

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? [choose all that apply]

-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. -Such poverty programs do not actually enable recipients to exercise godly dominion.

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 -moral

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

-governments do not respect the rights of property and the property in rights. -governments arbitrarily seize property to give to others. -governments apply unequal taxes to reward one type of property and oppress another -governments impose arbitrary restrictions, exemptions, and monopolies and consequently deny citizens the free use of their internal property.

_______________ 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 -coordination

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?"

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.

5. 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.

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.

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

free-market system

Which of the following is not a moral criteria of the free market or a necessary part of the ethical foundations of Economics? -love -justice -prudence -good intentions

good intentions

Which of the following is not a characteristic of the free market? -government coercion -spontaneous order -coordination -voluntary exchange

government coercion

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 ________________. (Insert one complete phrase)

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

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