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Evolution of Economic Paradigms Quiz

#1

Which economic paradigm is characterized by government intervention to address market failures and ensure social welfare?

Keynesian economics
Explanation

Government intervention for market failures and social welfare.

#2

Who is considered the founder of modern economics?

Adam Smith
Explanation

Founder of modern economics.

#3

According to classical economics, what is the primary driver of economic growth?

Labor productivity
Explanation

Labor productivity drives economic growth.

#4

Which economic paradigm advocates for the abolition of private property and the establishment of a classless society?

Marxian economics
Explanation

Advocates for abolition of private property.

#5

Which economic paradigm emphasizes the importance of institutions, property rights, and the rule of law in fostering economic development?

Institutional economics
Explanation

Emphasizes institutions, property rights, and rule of law.

#6

Which economic paradigm emphasizes the role of expectations, uncertainty, and animal spirits in driving economic activity?

Post-Keynesian economics
Explanation

Emphasizes expectations, uncertainty, and animal spirits.

#7

What is the central proposition of supply-side economics?

Lowering taxes and deregulation stimulate economic growth
Explanation

Lowering taxes and deregulation stimulate growth.

#8

Who coined the term 'invisible hand' to describe the self-regulating nature of markets in classical economics?

Adam Smith
Explanation

Coined 'invisible hand' in classical economics.

#9

Which economic theory suggests that individuals maximize utility based on their preferences and constraints?

Neoclassical economics
Explanation

Maximize utility based on preferences and constraints.

#10

What is the main critique of rational expectations theory in economics?

It assumes perfect information and foresight among economic agents
Explanation

Critique: Assumes perfect information and foresight.

#11

Which economic paradigm suggests that economic cycles are primarily driven by technological innovations and entrepreneurial activities?

Austrian economics
Explanation

Cycles driven by tech innovation and entrepreneurship.

#12

What is the central idea behind the concept of 'creative destruction' in Schumpeterian economics?

Technological progress requires the replacement of old industries with new ones
Explanation

Creative destruction: replace old with new for tech progress.

#13

Which economic theory suggests that individuals make decisions based on heuristics and biases rather than rational calculation?

Behavioral economics
Explanation

Decisions based on heuristics and biases in behavioral economics.

#14

Who coined the term 'neoliberalism' to describe the revival of classical liberal ideas in the 20th century?

Friedrich Hayek
Explanation

Coined 'neoliberalism': Friedrich Hayek.

#15

Which economic theory emphasizes the importance of studying individual behavior and decision-making processes?

Behavioral economics
Explanation

Emphasizes studying individual behavior: Behavioral economics.

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