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1. Nichola lived in Russia. She spent two to three hours a day shopping and waiting in line. This was because the government determined what goods would be produced, where they would be produced, and where they would be sold. The government pricing system kept prices artificially low and they had little incentive to increase supply. Therefore she had to compete for the limited goods by standing in line. She would love to buy products outside of her country however her money could only be used in her own country. What is this describing?a) Free Marketb) Planned Economyc) Buyer’s Marketd) Common Markete) C & D2. Situation: Ajaz, a fictional country makes laws that are meant to achieve a political objective. For instance they want to stimulate their export trade so they only allow imports that are used in the production of merchandise that will be exported. For instance they will only allow the importation of cotton if it will be used in garments that will then be exported. This is an example of what concept?a) Free tradeb) Planned economy with a blocked currencyc) Developmental State as Strategistd) Regulatory State as Strategiste) Communitarianism3. Situation: Tara, a fictional country makes laws that do not differentiate between companies, everyone is treated the same. There are very few laws, but those that they have are universally applied. This is an example of what concept?a) Free tradeb) Planned economy with a blocked currencyc) Developmental State as Strategistd) Regulatory State as Strategiste) Communitarianism4. Situation: Tara, a fictional country, uses a highly centralized system. Instead of having manufacturing facilities scattered throughout the country they concentrate them in one area, and produce everything for the whole country in that facility. This creates economies of scale, being bigger helps them to produce things more efficiently. What is this concept?a) Free tradeb) Planned Economy U formc) Developmental State as Strategistd) Regulatory State as Strategiste) Communitarianism5. Situation: You enter a country that all of a sudden has massive inflation. In the past year inflation has gone from 5% to 50%. How would you classify this situation?a) Political Riskb) Planned Economy U formc) Developmental State as Strategistd) Regulatory State as Strategiste) Economic Risk
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