Question 1

The Trade-Related Aspects of Intellectual Property Rights, attempts to reduce intellectual property protections to enhance trade.

Accepted Answer

Under the new agreement, known as the Trade-Related Aspects of Intellectual Property Rights (TRIPS), as of 1995 a council of the World Trade Organization is overseeing enforcement of much stricter intellectual property regulations. These regulations oblige WTO members to grant and enforce patents lasting at least 20 years and copyrights lasting 50 years.

Question 2

Interdependent political, economic, and legal systems of a country make up its:

Accepted Answer

The term political economy is used to stress that the political, economic, and legal systems of a country are interdependent; they interact and influence each other, and in doing so they affect the level of economic well-being.

Question 3

Product liability can be much lower if a product does not conform to required safety standards.

Accepted Answer

Product liability involves holding a firm and its officers responsible when a product causes injury, death, or damage. Product liability can be much greater if a product does not conform to required safety standards.

Question 4

_____ refers to a state where political power is monopolized by a party, group, or individual that governs according to religious principles.

Accepted Answer

Theocratic totalitarianism is found in states where political power is monopolized by a party, group, or individual that governs according to religious principles. The most common form of theocratic totalitarianism is based on Islam and is exemplified by states such as Iran and Saudi Arabia.

Question 5

In several Western democracies, the poor performance of state-owned enterprises, because of protection from competition and guaranteed government financial support, led to _____.

Accepted Answer

In many countries, state-owned companies performed poorly. As a consequence, a number of Western democracies voted many social democratic parties out of office in the late 1970s and early 1980s. They were succeeded by political parties, such as Britain's Conservative Party and Germany's Christian Democratic Party, that were more committed to free market economics. These parties sold state-owned enterprises to private investors (a process referred to as privatization).

Question 6

Which system of government generally permits some individual economic freedom but restricts individual political freedom, frequently on the grounds that it would lead to the rise of communism?

Accepted Answer

Right-wing totalitarianism generally permits some individual economic freedom but restricts individual political freedom, frequently on the grounds that it would lead to the rise of communism. A common feature of many right-wing dictatorships is an overt hostility to socialist or communist ideas.

Question 7

Modern socialism has been popularized largely through the work of _____.

Accepted Answer

Modern socialists trace their intellectual roots to Karl Marx (1818-1883), although socialist thought clearly predates Marx (elements of it can be traced to Plato). Marx argued that the few benefit at the expense of the many in a capitalist society where individual freedoms are not restricted.

Question 8

Product liability sets certain safety standards to which a product must adhere.

Accepted Answer

Product safety laws set certain safety standards to which a product must adhere.
Product liability involves holding a firm and its officers responsible when a product causes injury, death, or damage.

Question 9

Totalitarianism:

Accepted Answer

Totalitarianism is a form of government in which one person or political party exercises absolute control over all spheres of human life and prohibits opposing political parties.

Question 10

A political system that prioritizes the needs of the society over individual freedoms is called _____.

Accepted Answer

Collectivism refers to a political system that stresses the primacy of collective goals over individual goals. When collectivism is emphasized, the needs of society as a whole are generally viewed as being more important than individual freedoms.

Question 11

In a pure market economy:

Accepted Answer

In the archetypal pure market economy, all productive activities are privately owned, as opposed to being owned by the state. The goods and services that a country produces are not planned by anyone.

Question 12

The tenet of _____ is that the welfare of society is best served by letting people pursue their own economic self-interest.

Accepted Answer

A tenet of individualism is that the welfare of society is best served by letting people pursue their own economic self-interest, as opposed to some collective body (such as government) dictating what is in society's best interest.

Question 13

Antitrust laws in the United States are designed to:

Accepted Answer

Given the dangers inherent in monopoly, the role of government in a market economy is to encourage vigorous free and fair competition between private producers. Governments do this by outlawing restrictive business practices designed to monopolize a market (antitrust laws serve this function in the United States).

Question 14

Which of the following is a feature of a democracy?

Accepted Answer

Democracy refers to a political system in which government is by the people, exercised either directly or through elected representatives.

Question 15

Peoples' right to protest on issues of accountability in public expenditure would be possible in a _____ political set-up.

Accepted Answer

In a representative democracy, citizens periodically elect individuals to represent them. These elected representatives then form a government, whose function is to make decisions on behalf of the electorate. In a representative democracy, elected representatives who fail to perform this job adequately will be voted out of office at the next election. To guarantee that elected representatives can be held accountable for their actions by the electorate, an ideal representative democracy has a number of safeguards that are typically enshrined in constitutional law.

Question 16

The political systems of a country raise ethical issues that have implications for the practice of international business.

Accepted Answer

The political, economic, and legal systems of a country raise important ethical issues that have implications for the practice of international business. For example, what ethical implications are associated with doing business in totalitarian countries where citizens are denied basic human rights, corruption is rampant, and bribes are necessary to gain permission to do business?

Question 17

The _____ believed that socialism could be achieved only through violent revolution and totalitarian dictatorship.

Accepted Answer

The communists believed that socialism could be achieved only through violent revolution and totalitarian dictatorship, whereas the social democrats committed themselves to achieving socialism by democratic means, turning their backs on violent revolution and dictatorship.

Question 18

An economy in which the interaction of supply and demand determines the quantity in which goods and services are produced is called a _____.

Accepted Answer

In the archetypal pure market economy, all productive activities are privately owned, as opposed to being owned by the state. Production is determined by the interaction of supply and demand and signaled to producers through the price system.

Question 19

Which of the following philosophies can be traced back to the ancient Greek philosopher Aristotle?

Accepted Answer

Like collectivism, individualism can be traced to an ancient Greek philosopher, in this case Plato's disciple Aristotle (384-322 BC). In contrast to Plato, Aristotle argued that individual diversity and private ownership are desirable.

Question 20

Which of the following statements about individualism is true?

Accepted Answer

In practical terms, individualism translates into an advocacy for democratic political systems and market economics, which in general creates a more favorable environment for international businesses to operate in.

Quiz 2: National Differences in Political Economy, and Legal Systems