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Answers
1)
Which of the following best describes the USSR type of economies
a)
market economy
b)
command economy
c)
mixed economy, with elements of capitalism and socialism mixed
together
d)
mixed economy, with elements of capitalism, socialism, and
communism mixed together
e)
none of the above
2)
Which of the following statements is incorrect?
a)
several former members of the USSR block have joined the European
Union in 2004
b)
the transition in Eastern Europe in most place involved economic and
political reforms being done at the same time
c)
Eastern European transition experience is similar to the current
experience of China, where the economic reforms tend to precede
political reforms.
d)
None of the above
For questions 3-5, select from the list of the terms presented below.
3)
4)
5)
A situation where the state sells state owned productive assets to private
individuals Privatization
A situation where the employee’s objectives may not coincide with those of
the employer and inefficiency may arise as a result of this Principal-Agent
problem
A system where the fundamental economic questions (what, how and for
whom to produce) are answered by the government Command Economy
a)
b)
c)
d)
e)
f)
6)
nationalization
privatization
market economy
principal-agent problem
command economy
price liberalization
It can be argued that the transition of the economies of the former Soviet
Republics was more difficult than the transition of the former Soviet Eastern
European states because
a)
the USSR put strong emphasis on the heavy industry, dominated by
large in terms of employment firms, many of which were producing
military equipment
7)
b)
the USSR experienced command economy for a considerably longer
period of time
c)
choices a and b
d)
there is no possible economic explanation for the differences in the
experience of the transition
Which of the following best describes the reality of the US budget
a)
The US Federal budget is always in deficit
b)
The deficit of the US Federal budget is financed through
borrowing (the sale of US Treasury bonds)
c)
The deficit of the US Federal budget will result in the purchases of US
Treasury bonds by the US government
d)
None of the above
True/False statements
8)
Efficiency in government run enterprises increases with competitive pressure
TRUE
9)
Today, the CIS includes most of the former Soviet republics True (CIS
includes all but the Baltic States)