4) How are the fundamental economic decisions determined in Cuba?
a. Primarily, the government decides because Cuba is a centrally planned economy.
b. These decisions are made by the country’s elders who have had much experi- ence in answering these questions.
c. Individuals, firms, and the government interact in a market to make these economic decisions.
d. The United Nations decides because Cuba is a developing economy.
5) Which of the following correctly describes the relationship between economic efficiency and economic equity?
a. They are both automatically achieved in a free market economy. b. There is no conflict between the two goals.
c. There is often a trade-off between the two. d. They always call for opposite outcomes.
6) Which of the following statements best characterizes the disagreements be- tween Paul Samuelson and Jagdish Bhagwati in their debate about outsourc- ing?
a. Their disagreements are grounded in normative economic analysis. They dis- agree over how to interpret the relevant economic statistics.
b. Their disagreements are grounded in positive economic analysis. They dis- agree about the relevant economic statistics used in the model.
c. Their disagreements are grounded in normative economic analysis. They dis- agree over the types of jobs lost to outsourcing.
d. Their disagreements are grounded in positive economic analysis. They dis- agree about the model and the assumptions used in the model.
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