Theory - C5: Economical - P2

What is a Command Economy also known as?

A centrally planned economy

What is a main feature of a Command Economy regarding resources?

Government ownership of land and capital

What is a Market Economy also known as?

Consumer economy, capitalist economy, private enterprise economy, or free enterprise economy

What key factor motivates production and distribution in a Market Economy?

Profit motive

What economic system involves both the government and individuals making economic decisions?

Mixed Economies

What type of economy do both the UK and the US have?

Mixed economies which include private and public sectors

When did the first Industrial Revolution in the UK largely take place?

1760 - 1830

What period marked the American Industrial Revolution?

1865-1900

What political and economic policies advocated by Margaret Thatcher involved the privatization of nationalized industries?

Thatcherism

What was the New Deal?

A series of programs, public work projects, financial reforms, and regulations enacted by President Franklin D. Roosevelt in the US between 1933 and 1936

What sector is most important to the UK economy?

Services, particularly banking, insurance, and business services

What sector is most important to the US economy?

Service industries with the government services, business and health, banking, finance consultancy, computer and data processing, hotels, restaurants, leisure activities, trade, personal services, and communications

41. major UK trade partners.

United States, China, Germany, Netherlands and France

42. major US trade partners.

China, Canada, Mexico, Germany and Japan

39. What role does government play in a mixed economy?

Regulating markets and protecting consumers

47. What were two problems faced by workers during the UK Industrial Revolution?

Long hours and low wages

48. What was the New Deal?

US government programs to recover from the Great Depression

1. President Franklin D. Roosevelt's program implemented to stabilize the economy and intervene during the Great Depression was called what?

The New Deal

2. Although Karl Marx coined the term “capitalist,” today the American economy is best described as what type of economy?

A mixed economy

3. Which international financial institutions created alongside the UN had an “insatiable hunger for statistics”?

The World Bank and the International Monetary Fund

4. Why were the first leading indicators considered truly “macro statistics”?

They were meant to give shape and form to the big picture

5. By the early twentieth century, the USA became the world’s richest country primarily due to growth in which sectors?

Industrial and manufacturing output

6. Which organization is responsible for adjusting interest rates and controlling the US money supply?

The Federal Reserve System

7. How did the US Constitution of 1787 define the economic relationship between the states?

As a unified or common market

8. What economic consequence followed the UK’s 2016 referendum to leave the EU?

A sustained depreciation of the British pound

9. What major financial policy did the Cameron–Clegg coalition introduce in 2010 to address public deficits?

An austerity program

10. Why is “the economy” considered inseparable from the nation-state?

Most economic indicators treat the economy as a closed system within national borders

11. According to Adam Smith’s “invisible hand,” what results when individuals pursue their self-interest?

The most efficient use of a nation’s resources

12. What is the main purpose of social regulation imposed by the US government on private industry?

To promote non-economic objectives such as environmental protection and workplace safety

13. Which sector, including banking and insurance, is a key driver of British GDP growth?

The services sector

14. Before the 1940s, why did the modern concept of “the economy” not exist?

There were no established indicators such as GDP

15. What is the primary role of the independent Bank of England since 1997?

Setting interest rates to control inflation

16. Which statistics are commonly described as leading indicators of economic health?

Industrial production and consumer confidence

17. What term describes the 1980s UK policy of transferring state-owned industries to private ownership?

Privatization

18. When did economic indicators like GDP, unemployment, and inflation begin to be tracked regularly?

After World War II

19. Why is knowledge of the history of economic indicators important?

To assess whether they still serve society effectively

20. What term refers to exports such as financial and insurance services not included in the goods trade balance?

Invisible exports