The Failure of Communism in a Large Number of Countries

question 90

Multiple Choice

The failure of communism in a large number of countries is at least partly explained by

• A)the fact that those countries relied absolutely on the invisible hand.
• B)the fact that those countries did little or nothing to restrict trade with other countries.
• C)the lack of information,on the part of central planners in those countries,about tastes and preferences in their economies.
• D)the lack of information,on the part of central planners in those countries,about how much authority the government had in affecting economic outcomes.

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Definitions:

Operating Activities

Activities directly related to the day-to-day operations of a business, including sales, provision of services, and costs.

Cash Position

An indicator of a company's liquidity, showing the amount of cash or cash equivalents it has on hand at a given time.

Balance Sheet

A financial statement that provides a snapshot of a company's financial condition at a single point in time by detailing assets, liabilities, and equity.

Operating Activities

The day-to-day actions of a business involved in producing and selling its goods or services, which are reflected in the cash flow from operating activities.