BMO2004 PRACTISE Assessment MCQ TEST SAMPLE Chapter 3 The Nature of Capitalism

Name:
Class: Date:
3 The nature of capitalism

Multiple Choice
1. Which of the following historical stages of capitalism came first?

a. Financial
b. Mercantile
c. Industrial
d. State welfare
ANSWER: b
POINTS: 1
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
TOPICS: Historical background of capitalism
DATE CREATED: 11/24/2020 12:19 AM
DATE MODIFIED: 11/24/2020 12:19 AM
2. The division of labour:

a. is the only way increasing economic productivity.
b. allows individuals to follow their own interests.
c. is a practice of dividing the labour and production process into further areas of specialisation.
d. is basically unjustifiable.
ANSWER: c
POINTS: 1
TOPICS: Adam Smith’s concept of the ‘invisible hand’
DATE CREATED: 11/24/2020 12:19 AM
3. A basic tenet of capitalism is that:

a. property refers only to physical objects.
b. ownership is a simple relationship between a person and the thing owned.
c. capitalism requires private ownership of the major means of production.
d. in the twenty-first century, capitalism no longer requires capital.
ANSWER: c
POINTS: 1
TOPICS: Key features of capitalism
DATE CREATED: 11/24/2020 12:19 AM
4. The concept of the ‘invisible hand’ means:

a. each person’s private pursuit of wealth will result in the most beneficial overall organisation and distribution of
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Name: Class: Date:
economic resources.
b. although it cannot be seen, the hand of government controls the economy and exerts a beneficial pressure
that promotes economic welfare.
c. feudalism inevitably gives rise to capitalism.
d. externalities must be internalised.
ANSWER: a
POINTS: 1
TOPICS: Adam Smith’s concept of the ‘invisible hand’
DATE CREATED: 11/24/2020 12:19 AM
5. One of the four key features of capitalism is:

a. favouritism.
b. cooperation.
c. inequality.
d. private property.
ANSWER: d
POINTS: 1
DATE CREATED: 11/24/2020 12:19 AM
6. Capitalism operates on the debatable assumption that human beings find increased well-being through:
a. production of equality.
b. eliminating poverty.
c. greater material consumption.
d. a higher sense of purpose.
ANSWER: c
POINTS: 1
TOPICS: Human nature and capitalism
DATE CREATED: 11/24/2020 12:19 AM
7. Many utilitarians would argue that:

a. increased worker participation in industrial life is beneficial.
b. social utility is irrelevant to issues of justice.
c. there is already sufficiently equal distribution of income.
Name: Class: Date:
d. the free trade and laissez-faire view of Adam Smith best promotes the total social good.
ANSWER: a
POINTS: 1
TOPICS: Ethical theory and economic
distribution
DATE CREATED: 11/24/2020 12:19 AM
8. Karl Marx believed that:

a. under capitalism, workers are alienated in several ways.
b. capitalism no longer exploits workers.
c. industrialisation does away with alienation.
d. workers are alienated from their products, but not from themselves or other people.
ANSWER: a
POINTS: 1
TOPICS: Capitalism as exploitation and
alienation
DATE CREATED: 11/24/2020 12:19 AM
9. In Anarchy, State and Utopia, Robert Nozick advocates:

a. libertarianism.
b. Kantianism.
c. utilitarianism.
d. egoism.
ANSWER: a
POINTS: 1
TOPICS: The libertarian approach
DATE CREATED: 11/24/2020 12:19 AM
10. Nozick’s libertarian theory proposes:

a. libertarians endorse utilitarianism’s concern for total social well-being.
b. pleasure takes priority over any other moral concern.
c. libertarians generally agree that liberty allows only a ‘night-watchman’ state.
d. if a person comes into possession of a holding through a legitimate transfer, then, morally speaking, she or he
deserves that holding.

Name: Class: Date:
ANSWER: c
POINTS: 1
DATE CREATED: 11/24/2020 12:19 AM
11. According to John Rawls:

a. people in the original position choose the principles on the basis of self-interest.
b. in the original position, people must have full and complete knowledge.
c. justice forbids any social or economic inequalities.
d. liberty is of little or no importance compared to equality.
ANSWER: a
POINTS: 1
TOPICS: Rawls and just economic distribution
DATE CREATED: 11/24/2020 12:19 AM
12. The veil of ignorance proposes that:

a. those in the original position are supposed to choose principles on the basis of self-interest, so agreement
seems unlikely.
b. one group would be supportive of another group benefiting, even though the rules are different.
c. people are fully knowledgeable about themselves or situation, allowing them to have a partial or biased point
of view.
d. agreement is difficult to attain.
ANSWER: a
POINTS: 1
TOPICS: Rawls and just economic distribution
DATE CREATED: 11/24/2020 12:19 AM
13. Which statement best describes capitalism?

a. Capitalism is an economic system in which the means of production and distribution is in state hands.
b. Capitalism is an economic system that operates under the profit motive.
c. Capitalism is an economic system that dispenses with competition.
d. Capitalism is an economic system where the profits generated belong to the state as a whole.
ANSWER: b
POINTS: 1
Name: Class: Date:
DATE CREATED: 11/24/2020 12:19 AM
14. Which of the following is an accurate statement?

a. Adam Smith defends capitalism by appealing to the idea of a natural, moral right to property.
b. Adam Smith denies that human beings are, by nature, acquisitive creatures.
c. A common defence of capitalism is the argument that people have a fundamental moral right to property and
that our capitalist system is simply the outcome of this natural right.
d. Utilitarians oppose capitalism in principle.
ANSWER: c
POINTS: 1
TOPICS: The natural right to property
DATE CREATED: 11/24/2020 12:19 AM
15. Socialism states that:

a. the economic system should be based on communal interest and cooperativeness.
b. socialism will eventually be replaced by financial capitalism.
c. the means of production should be placed under the control of the bourgeoisie.
d. only workers who are poorly paid in a capitalist system are alienated.
ANSWER: a
POINTS: 1
TOPICS: 3.5 Socialism
DATE CREATED: 11/24/2020 12:19 AM
16. Which of the following accurately reflects the concept of Marxism?

a. It is only within a capitalist economic system that workers are not alienated from the products of their labour.
b. Only workers who are poorly paid for their labour are alienated.
c. Within a capitalist economic system, the activity of labour is an end in itself and, as a result, has intrinsic value.
d. Labour is alienated in a capitalist economic system (in part) because the labour of a worker stands opposed to
the worker as an autonomous power.
ANSWER: d
POINTS: 1
Name: Class: Date:

alienation
DATE CREATED: 11/24/2020 12:19 AM
17. Which of the following is a key feature of socialism?

a. Private property
b. Profit motivation
c. Centralised planning
d. Free marketplace
ANSWER: c
POINTS: 1
TOPICS: Key features of socialist
economies
DATE CREATED: 11/24/2020 12:19 AM
18. Which of the following is not a socioeconomic problem facing us today?

a. Outsourced jobs
b. Expanding manufacturing sector
c. Trade deficits
d. Short-term performance mentality
ANSWER: b
POINTS: 1
TOPICS: 3.6 Today’s economic challenges
DATE CREATED: 11/24/2020 12:19 AM
19. For employees who are paid handsomely for their efforts, Marx said their work would ultimately prove to
be:
a. profitable to them.
b. expensive to them.
c. meaningless to them.
d. tireless.
ANSWER: c
POINTS: 1
Name: Class: Date:
alienation
DATE CREATED: 11/24/2020 12:19 AM
20. Many economists are concerned that the growing trade deficits in Western countries can cause:
a. terrorist attacks.
b. individual incentives.
c. fairness.
d. soaring inflation.
ANSWER: d
POINTS: 1
TOPICS: The decline of Western manufacturing
DATE CREATED: 11/24/2020 12:19 AM
True / False
21. Worker control socialism is a hybrid economic system with no marketplace and no profits.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
TOPICS: Key features of socialist
economies
DATE CREATED: 11/24/2020 12:19 AM
22. If it is true that individuals have a natural right to own property, then there can be no limits on this right.
a. True
b. False
ANSWER: False
POINTS: 1
TOPICS: 3.2 Moral justifications of
capitalism
DATE CREATED: 11/24/2020 12:19 AM

Name: Class: Date:
23. Adam Smith claims that the proper role of governments is to restrict and regulate the self-interested
behaviour of business organisations for the common good.
a. True
b. False
ANSWER: False
POINTS: 1
DATE CREATED: 11/24/2020 12:19 AM
24. None of the specific measures proposed by Marx and Engels in the Communist Manifesto have been
implemented in capitalist countries.
a. True
b. False
ANSWER: False
POINTS: 1
alienation
DATE CREATED: 11/24/2020 12:19 AM
25. According to Adam Smith, individuals have natural endowments that should determine the kind of work
they do.
a. True
b. False
ANSWER: True
POINTS: 1
TOPICS: The natural right to property
DATE CREATED: 11/24/2020 12:19 AM
26. Outsourcing is a practice where companies buy parts or whole products from other producers, both at home
and abroad.
a. True
b. False
ANSWER: True
POINTS: 1

Name: Class: Date:
TOPICS: The decline of Western manufacturing
DATE CREATED: 11/24/2020 12:19 AM
27. According to Marx, the best economic system would be one where the means of production and distribution
are in the hands of the bourgeoisie.
a. True
b. False
ANSWER: False
POINTS: 1
alienation
DATE CREATED: 11/24/2020 12:19 AM
28. According to Robert Nozick, the basic moral rights possessed by all human beings are both negative and
natural.
a. True
b. False
ANSWER: True
POINTS: 1
DATE CREATED: 11/24/2020 12:19 AM
29. Socialism is an economic system characterised by public ownership of the means of production and
distribution, and a planned economy.
a. True
b. False
ANSWER: True
POINTS: 1
TOPICS: 3.5 Socialism
DATE CREATED: 11/24/2020 12:19 AM

Name: Class: Date:
30. Libertarians reject inheritance as a legitimate means of acquiring wealth.

a. True
b. False
ANSWER: False
POINTS: 1
TOPICS: Liberty, markets and
property
DATE CREATED: 11/24/2020 12:19 AM

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3 The nature of capitalism

1. Which of the following historical stages of capitalism came first?

2. The division of labour:

3. A basic tenet of capitalism is that:

4. The concept of the ‘invisible hand’ means:

3 The nature of capitalism

5. One of the four key features of capitalism is:

7. Many utilitarians would argue that:

3 The nature of capitalism

8. Karl Marx believed that:

9. In Anarchy, State and Utopia, Robert Nozick advocates:

10. Nozick’s libertarian theory proposes:

Copyright Cengage Learning. Powered by Cognero. Page 3

3 The nature of capitalism

11. According to John Rawls:

12. The veil of ignorance proposes that:

13. Which statement best describes capitalism?

3 The nature of capitalism

14. Which of the following is an accurate statement?

15. Socialism states that:

16. Which of the following accurately reflects the concept of Marxism?

3 The nature of capitalism

TOPICS: Capitalism as exploitation and

17. Which of the following is a key feature of socialism?

18. Which of the following is not a socioeconomic problem facing us today?

3 The nature of capitalism

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3 The nature of capitalism

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3 The nature of capitalism

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3 The nature of capitalism

30. Libertarians reject inheritance as a legitimate means of acquiring wealth.

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