BCOR 2302- Quiz #2 And Already
Solved Solutions.
What makes markets moral spaces? - Answer treat doing business as an extension of
friends/family
What purposes do markets serve? - Answer the context for exchanging thee products of
capital
What is capitalism? - Answer thee social institution in which private capital is organized in an
ad hoc fashion by the exchange relationships between commodity seeking consumers and
capital seeking producers all of whom are seeking to satisfy their desires.
What is the general economy? - Answer a reference point of contrast how we usually
approach the marketplace
How doe the general economy challenge capitalism's traditional starting point in scarcity? -
Answer the economy is NOT about managing scarcity to most efficiently satisfy human
desire, by efficiently coordinating scarce resources to produce as much as possible with as little
as possible.
What is the key question that the general economy poses? - Answer What is the best way of
expanding the inevitable surplus produced by economic life?
What are some ways in which humans spend their economic excess? - Answer - war
- parties
What does sacrafice mean in the general economy? - Answer it is about offering life,
reconnects us to the source of life
According to Adam Smith what are the 5 ingredients of capitalism? - Answer 1. self interest
2. competition
3. efficiency
4. division of labor
5. pricing
What is the difference between broad self interest and narrow self interest? - Answer
broader= seeks to grow the overall size of the pie, not minimize the size of your own slice
, narrow= like greed
What type of self interest does Adam Smith favor? - Answer Broad self interest
What type of business exemplifies narrow self interest? - Answer maximize profit for
cooperation
What type of business exemplifies broad self interest? - Answer a wellness practice that
benefits all stakeholders
Does Adam smith think that markets are places that follow the same moral rules as apply to our
relationships with friend, family? - Answer yes
How is Smith's invisible hand related to self interest? - Answer self interest + competition =
invisible hand
What are some forms of anti-competitive behavior? - Answer - monopolies
- monopsonies
What is Smiths moral case against anti-competitive behavior? - Answer they should NOT
collude with competitors and fixed prices
According to Smith what is the ethical case for efficient markets? - Answer drives the
greatest good for the greatest number at the lowest cost
What is the division of labor and what does it do? - Answer - specializing in what you are
good at to enable self-interested coordination and collaboration w individuals amongst teams
What market dynamics, for Smith, should set the prices of goods? - Answer the market
What are some advantages of a market-based price system to the consumer? - Answer -
lowest price
- best quality
According to Smith, what is the 'natural price'? - Answer - minimal sustainable price, covers
rent, wages, and profit
What is the risk of going below the 'natural price'? - Answer it is unsustainable
Solved Solutions.
What makes markets moral spaces? - Answer treat doing business as an extension of
friends/family
What purposes do markets serve? - Answer the context for exchanging thee products of
capital
What is capitalism? - Answer thee social institution in which private capital is organized in an
ad hoc fashion by the exchange relationships between commodity seeking consumers and
capital seeking producers all of whom are seeking to satisfy their desires.
What is the general economy? - Answer a reference point of contrast how we usually
approach the marketplace
How doe the general economy challenge capitalism's traditional starting point in scarcity? -
Answer the economy is NOT about managing scarcity to most efficiently satisfy human
desire, by efficiently coordinating scarce resources to produce as much as possible with as little
as possible.
What is the key question that the general economy poses? - Answer What is the best way of
expanding the inevitable surplus produced by economic life?
What are some ways in which humans spend their economic excess? - Answer - war
- parties
What does sacrafice mean in the general economy? - Answer it is about offering life,
reconnects us to the source of life
According to Adam Smith what are the 5 ingredients of capitalism? - Answer 1. self interest
2. competition
3. efficiency
4. division of labor
5. pricing
What is the difference between broad self interest and narrow self interest? - Answer
broader= seeks to grow the overall size of the pie, not minimize the size of your own slice
, narrow= like greed
What type of self interest does Adam Smith favor? - Answer Broad self interest
What type of business exemplifies narrow self interest? - Answer maximize profit for
cooperation
What type of business exemplifies broad self interest? - Answer a wellness practice that
benefits all stakeholders
Does Adam smith think that markets are places that follow the same moral rules as apply to our
relationships with friend, family? - Answer yes
How is Smith's invisible hand related to self interest? - Answer self interest + competition =
invisible hand
What are some forms of anti-competitive behavior? - Answer - monopolies
- monopsonies
What is Smiths moral case against anti-competitive behavior? - Answer they should NOT
collude with competitors and fixed prices
According to Smith what is the ethical case for efficient markets? - Answer drives the
greatest good for the greatest number at the lowest cost
What is the division of labor and what does it do? - Answer - specializing in what you are
good at to enable self-interested coordination and collaboration w individuals amongst teams
What market dynamics, for Smith, should set the prices of goods? - Answer the market
What are some advantages of a market-based price system to the consumer? - Answer -
lowest price
- best quality
According to Smith, what is the 'natural price'? - Answer - minimal sustainable price, covers
rent, wages, and profit
What is the risk of going below the 'natural price'? - Answer it is unsustainable
