University of Colorado, Boulder

INBU 3300

Chapter 4

1)Managers at Morrison Manufacturing are considering expanding the firm's production overseas and want to ensure that the firm is located in a country with a high degree of economic freedom. Presently, which of the following locations would most likely offer Morrison the highest economic freedom?

1. 1. 1. Mexico
      2. Hong Kong
      3. Venezuela
      4. North Korea

1. 2. The recent global credit crisis has interrupted the trend of national economies

                .

1. 1. 1. rapidly adopting the command market model
      2. steadily adopting the free market model
      3. moving from the mixed to the command model
      4. turning away from the mixed model

1. 3. Communism primarily relies on a system of                             .
      1. private business ownership
      2. competitive pricing and marketing
      3. market-­?generated supply and demand
      4. government controlled economic activity

1. 4. Market economies are primarily characterized by                              .
      1. formal cooperation among government, companies, and workers to achieve

stable growth

1. 1. 2. heavy government spending and high taxation to pay for a range of social services
      3. minimal governmental participation
      4. restricted consumer powers

1. 5. In a                  economy, certain sectors of the economy are left to private ownership and free market mechanisms, while other sectors have significant state ownership and government planning.
      1. state-­?directed
      2. market
      3. command
      4. mixed

1. 6. Country X is in the process of transforming from a command economy to a market economy. This process most likely involves                                                                            .
      1. standardized procedures implemented by the state
      2. high economic growth rates for the long-­?term
      3. privatization of many factors of production
      4. violent political and legal upheaval

1. 7. The                  starts with the same accounting framework used to calculate GDP but then adjusts for values assigned to environmental quality, population health, livelihood security, equity, free time, and educational attainment.
      1. Gross National Index
      2. Net National Product
      3. Genuine Progress Indicator
      4. Human Development Index

1. 8. In the U.S., the unemployment rate indicates the                          .
      1. percentage of the labor force that wants to work full-­?time but can only find part-­? time employment
      2. number of people who have stopped looking for work because full-­?time jobs are unavailable
      3. percentage of unemployed workers seeking paid work relative to the total labor force
      4. number of workers eligible for government services and unemployment benefits

1. 9. The so-­?called "misery index" is the sum of a country's                               .
      1. foreign and national debt
      2. inflation and unemployment rates