Question

In order to evaluate the effect of the economic system on outcomes, which of the      following must we hold constant

a) Environmental factors.

b) Decision-making arrangements.

c) Ownership arrangements.

d) Economic policies.

e) Both a and d are correct

Answer 1

Decision making arrangements and ownership arrangements are part of economic system.for example in capitalist economy there is private ownership of good , whereas in socialism government has ownership of all goods.so it will be different Among different system.

Environmental factors and policies should be remain constant.

For example we want know which system is better ,when government spending is Increases. So we need yo make a constant Increase in spending in both system to find out the results.

So option e is right.