Chapter 1 Test Form A Foundations of Government DIRECTIONS: FIl-In-the-Blank Enter the appropriate word(s)to complete the statement. 1. Democracles operate according to majority __ meaning that parties representing the majority make most laws. 2. The United States is considered a(n) __ economy because it combines elements of capitalism and socialism. 3. A(n) __ system shares, power between national and state governments. 4. A community with an organized government in a territory is called a __ 3. In a(n) __ state, all economic decisions are made by the government. 6. The __ theory claims that states exist to serve their people. 7. __ believe that economic security depends on the accumulation of gold and sliver. 8. In a(n) __ one person inherits the throne and heads the state. 9. Some governments provide __ assistance, such as food stamps or rent subsidies. 10. In a(n) __ the people rule directly or through representatives.

1. Democracies operate according to majority **rule**, meaning that parties representing the majority make most laws.<br />2. The United States is considered a(n) **mixed** economy because it combines elements of capitalism and socialism.<br />3. A(n) **federal** system shares power between national and state governments.<br />4. A community with an organized government in a territory is called a **state**.<br />5. In a(n) **command** economy, all economic decisions are made by the government.<br />6. The **social contract** theory claims that states exist to serve their people.<br />7. **Mercantilists** believe that economic security depends on the accumulation of gold and silver.<br />8. In a(n) **monarchy**, one person inherits the throne and heads the state.<br />9. Some governments provide **welfare** assistance, such as food stamps or rent subsidies.<br />10. In a(n) **democracy**, the people rule directly or through representatives.