Economic System
What is the most common type of economy in the world today?
Mixed economy.
What is a tariff?
A tax on imported goods.
Why do people exchange currencies when traveling abroad?
To make buying goods and services easier.
What is specialization?
Focusing on producing certain goods more efficiently.
Why was the European Union formed?
To establish voluntary trade and strengthen European relationships.
In a command economy, who controls natural resources?
The government.
What is a quota?
A limit on the amount of imported goods.
What is the benefit of currency exchange for businesses?
It allows easier international business transactions.
How does specialization affect trade between countries?
It increases trade.
What is the primary purpose of the European Union?
To promote free trade among its member countries.
What are the three basic economic questions every system must answer?
What to produce, how to produce, and for whom to produce.
What does an embargo do?
It completely bans trade with a specific country.
Which country in Europe uses the Euro for currency?
Germany.
Name one benefit of specialization.
It lowers the cost of producing goods.
What currency is commonly used in the European Union?
Euro.
Which economic system involves bartering and traditions to answer the basic economic questions?
Traditional economy.
Why might Germany impose a tariff on American steel?
To encourage people to buy German steel instead.
What happens if two countries don't exchange currencies?
They cannot easily trade goods and services.
Russia specializes in steel, and Germany specializes in cars. What is likely to happen?
They trade with one another.
Name one benefit of EU membership for businesses
Access to a larger market with fewer trade barriers.
What do Germany, Russia, and the United Kingdom currently have in common regarding their economies?
They are all mixed economies.
Name all three political trade barriers.
Tariff, quota, embargo.
Which of the following countries is most likely to have the highest standard of living: Brazil, Germany, UK, Russia
Germany
Give an example of investment in capital goods.
A chef buying a better oven and stove.
What are the key goals of the European Union?
To enhance trade, promote peace, and strengthen relationships among European nations.