Innovation lagged in the centrally planned economies because:
A. there was too much domestic business competition.
B. there was too much competition from foreign firms.
C. enterprises resisted innovation in fear that their production targets would be raised.
D. exports had to equal imports for the plan to work.
Answer: C
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Following the war-time prosperity for capital and the rich during World War I (1914–18), income distribution trended towards greater equality when peace came and market forces replaced the economy's wartime concerns in determining income
distribution. Indicate whether the statement is true or false
An excise tax is a tax that is levied on
A) the value of a piece of property. B) the purchase of a given good or service. C) the value of an estate. D) that part of a person's income coming from interest payments.
Inefficiency is a flaw of a command economy because there is less incentive for resources to flow to their highest-valued uses
a. True b. False
The vicious-circle-of-poverty hypothesis states that poor countries
A. cannot develop because people don't consume due to lack of goods and services. B. are unable to save and invest enough to accumulate capital stock that would help them grow. C. cannot develop because they lack the ability to educate their workers. D. cannot develop because their economic policies are ineffective.