Le 691 Quiz

Quiz 4

Chapter 2:

_Socialist nations: a country’s economic and social needs are best served when government owns major industries and provides a comprehensive array of social services

_Communist: restrict private ownership of property and authorize public agencies to allocate the nation’s resources to meets its needs

_Capitalist: divide politics and economics into distinct spheres, ensuring societal diversity and denying any institution complete domination

_4 functions of government:

+ establishing a framework within which the country’s econ and political institutions operate

+Using authority to promote nation’s economic well-being

+Regulating the undesirable consequences of market activity

+ Organizing the social services that sustain a large part of the population

_Framework state: create the institutional structure in which political and economic activity occurs.

_Promotional state: use its authority to enhance the nation’s economy.

_Regulatory state: mitigate the undesirable consequences of market activity without losing the benefits of competitive economy. Government regulates the products and production processes of private firms and issues rules governing collective bargaining, equal opportunity, and human resource policies.

+ Sometimes, regulatory state is captured by groups that use government authority to produce the policy results they favor

_Social service state: the distribution of wealth and income among people in a society

_The market model: corporations operate for the benefit of their shareholders and that corporate managers act to maximize shareholder value.

+both individuals and firms purchase the products that give them the greatest satisfaction for their money and that they purchase these goods in perfectly competitive markets.

_The stakeholder model: the hub of relations among the societal groups that have a stake in corporate decisions.

+rejects both the assumption that the interests of stockholders alone should guide...