Economic Systems
Economics · 50 practice questions
Types and characteristics of free enterprise, centrally planned and mixed economies; solutions to economic problems under different systems; contemporary issues in economic systems (e.g. deregulation, banking sector consolidation, cash policy reform).
- Compare the various economic systems.
- Apply the knowledge of economic systems to contemporary issues in Nigeria.
- Proffer solutions to economic problems in different economic systems.
Try a few questions
- Practice question 1
A common criticism of centrally planned economies is that they
- A.always produce goods more cheaply than markets
- B.never experience shortages of any good
- C.often suffer inefficiency from the absence of price signals and profit incentives
- D.automatically match output to consumer preferences
Show the answer
C. often suffer inefficiency from the absence of price signals and profit incentives
Without prices/profit motive, planners struggle to allocate efficiently.
- Practice question 2
Economic system reforms in Nigeria, such as banking sector consolidation, are generally aimed at
- A.reducing the number of Nigerians who can access banking services
- B.transferring all banks to full government ownership
- C.strengthening financial institutions and boosting investor confidence
- D.eliminating the central bank's regulatory role
Show the answer
C. strengthening financial institutions and boosting investor confidence
Consolidation aims to build stronger, more trusted financial institutions.
- Practice question 3
A defining characteristic of a free enterprise economy is
- A.central allocation of all resources by the state
- B.private ownership of resources and the profit motive
- C.the total absence of markets
- D.production based purely on tradition and custom
Show the answer
B. private ownership of resources and the profit motive
Private ownership and profit-seeking define free enterprise.
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