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Bus Econ Test 1Quiz Directions

Choose the best answer for each question. You will have one attempt to take this test.

Questions

1.1 pt(s).

Why are resources considered limited?

A. Entrepreneurs do not invest enough of them.

B. There are not enough available so that everyone can have as much of them as desired.

C. Everyone has them, and they change.D. There are so many that people must decide which ones to choose at any one time.

2.1 pt(s).

Which of the following is an economic activity:

A. Following the stock marketB. Reading a bank statementC. Balancing a checkbook

D. Purchasing a candy bar

3.1 pt(s).

Why are human resources limited?

A. Some people are unable to work.

B. New equipment is expensive.C. Countries lack needed technology.D. World population continues to grow.

4.1 pt(s).

Which of the following does consumption rely on to provide goods and services:

A. Producers

B. ConsumersC. OwnersD. Deciders

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5.1 pt(s).

In some states, it is against the law to sell alcohol on Sundays. This law was created to honor theChristian religious belief that Sunday is a special day of rest. This is an example of culture impacting the__________ of goods.A. production

B. distribution

C. pricingD. packaging

6.1 pt(s).

Which of the following is an example of a change in culture affecting the production of a good orservice:

A. A shortage of chocolate chips causes a cookie company to stop production.B. Laws banning smoking in restaurants result in a decrease in demand for cigarettes.C. A An oil spill in the ocean causes local seafood restaurants to lose business.

D. The "green movement" leads to an increase in demand for recycled products.

7.1 pt(s).

Which of the following is a negative economic incentive:

A. Tax reductions on fuel-efficient cars

B. High taxes on cigarettes

C. A 1% decrease in city taxes for residents who recycleD. Free flu shots for all citizens

8.1 pt(s).

The U.S. government is offering a decrease in taxes to citizens who install solar panels on their homes.Using economic terms, how would you describe this incentive?

A. Financial and positive

B. Non-financial and positiveC. Non-financial and negativeD. Financial and perverse

9.1 pt(s).

When changes in a product's price cause corresponding changes in consumer demand, the product has

A. elastic demand.



B. usefulness.C. utility.D. inelastic demand.

10.1 pt(s).

The amount of a product that is produced is most directly affected by

A. labor unions.B. product utility.C. product value.

D. consumer demand.

11.1 pt(s).

Which of the following is characteristic of a buyer's market:

A. High demandB. Steady demandC. Low supply

D. Low prices

12.1 pt(s).

Which of the following factors affects consumers' decisions to buy goods or services:

A. Buying power

B. CompetitionC. Labor costsD. Production costs

13.1 pt(s).

Which of the following might cause supply of a good to decrease:

A. AdvertisingB. Sales skillsC. Inelastic demand

D. Government regulations



14.1 pt(s).

When customers buy the exact amount of goods that producers are selling at a specific price, the__________ price exists.

A. market

B. equilibrium

C. unitD. production

15.1 pt(s).

Which of the following is a business comparing when it analyzes the cost of buying wood desks versusthe cost of buying metal desks:

A. Excess demand

B. Relative price

C. Inflated priceD. Incentives

16.1 pt(s).

The market's way of rationing limited resources, goods, and services to consumers in a market economyis through

A. commissions.B. profits.C. incentives.

D. prices.

17.1 pt(s).

What is the ratio of a pound of yellow squash @ $0.60 a pound and a pound of butternut squash @$1.20 a pound?

A. 1 to 4B. 1 to 3

C. 1 to 2

D. 1 to 1

18.1 pt(s).

Which of the following is an example of excess supply:

A. Price = $500, demand = 500, supply = 300

B. Price = $700, demand = 300, supply = 500

C. Price = $600, demand = 400, supply = 400D. Price = $400, demand = 600, supply = 200



19.1 pt(s).

Arm and Hammer baking soda, which was originally developed as a cooking ingredient, is now beingsold as an effective refrigerator deodorizer. This is an example of ____________ innovation.

A. positioning

B. processC. distributedD. associative

20.1 pt(s).

Which of the following is an example of paradigm innovation:

A. Facebook

B. Energy-saving light bulbsC. The latest model of the Honda CivicD. Rechargeable batteries

21.1 pt(s).

John only had $40 to spend and couldn't decide whether to buy a new pair of jeans or to go to anamusement park. He finally decided to spend his money on the amusement park. What was theopportunity cost of his decision?A. $40

B. New pair of jeans

C. Trip to amusement parkD. No opportunity cost was involved.

22.1 pt(s).

Justin is trying to decide whether he wants to spend a $50 birthday check on a new DVD player ortickets to a concert. If he chooses the DVD player, what is the opportunity cost of this decision?

A. Birthday checkB. DVD player

C. Concert tickets

D. $50

23.1 pt(s).

Sam has been invited to go to the movies with one friend and to Dairy Queen for ice cream withanother friend. Because he has only $5.00, Sam can't do both. If he decides to go the movies, theopportunity cost of his choice is



A. staying at home.B. both the ice cream and the movie.

C. ice cream at Dairy Queen.

D. the movie.

24.1 pt(s).

The time it takes to complete an assignment is an example of this kind of cost.

A. Explicit

B. Implicit

C. SunkD. Economic

25.1 pt(s).

The cost of raw materials needed to produce a new product is an example of this kind of cost.

A. Explicit

B. ImplicitC. SunkD. Economic

26.1 pt(s).

Isabella owns a car and has an opportunity to go to the movies. How should she factor the costs ofowning her car in the decision to go to the movies?

A. All of the car costs should be included.B. Her monthly car payment and insurance costs should be included.

C. Only the cost of parking and gas needed to drive to the movies should be included.

D. None of the car costs should be included.

27.1 pt(s).

Which of the following is an example of process innovation?

A. The recipe for Twinkies

B. Electronic filing of Federal Income tax

C. Paying bills with checksD. Mailing a letter to a customer.



28.1 pt(s).

A couple constructs a decision matrix to select which charity will receive a $500 donation. Since “helpingchildren” is the most important criteria to the couple, which of the following weights should it beassigned?A. 2B. 3C. 4

D. 5

29.1 pt(s).

A group of entrepreneurs is trying to decide which of five new product ideas to select. Which tool can beused to help make the decision?

A. Entrepreneurial discovery processB. Business processes

C. Decision matrix

D. Opportunity cost analysis

30.1 pt(s).

A decision matrix can be used to evaluate these two kinds of elements:

A. timeB. options or alternativesC. selection criteria

D. Both b and c

31.1 pt(s).

The weight that is given to each selection criteria in a decision matrix is directly related to its_________________ in the decision.

A. costB. benefit

C. importance

D. order

32.1 pt(s).

You can use a ______________ to gather information from stake holders in the decision to establish theweight for each criteria.

A. guess

B. survey



C. testD. bribe

33.1 pt(s).

When evaluating alternatives in a decision matrix you ________________ the weight and the criteriavalue to determine the final score

A. divideB. add

C. multiply

D. subtract

34.1 pt(s).

When all of the weighted criteria scores have been calculated to determine the final score for eachalternative you _____________ all of the weighted scores.

A. add

B. multiplyC. subtractD. divide

35.1 pt(s).

A decision matrix is a tool to break complex decisions into ________________ so the decision can beevaluated.

A. large partsB. small piecesC. time segments

D. basic important elements

36.1 pt(s).

A way to quickly generate many alternatives to be considered in a decision is

A. surveyB. town hall meetings

C. brainstorming

D. research

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Test2Quiz Directions

You will have One attempt to take this quiz.

Questions

1.1 pt(s).

Production of livestock on a ranch, shipping livestock to a processing plant, slaughtering and processingthe livestock, packaging and shipping processed meat to market, butchering and packaging meat in agrocery store are examples of this kind of specialization.A. obsolescence

B. stages of production

C. capital goodsD. natural resources

2.1 pt(s).

Which of the following is true of employees whose jobs have low depth:

A. They set their own pace.B. They follow strict guidelines.C. They perform only one task.

D. They make very few decisions.

3.1 pt(s).

Which of the following examples best exhibits a job task with low depth and low scope:

A. A manager signs employees’ time cards.

B. A manager evaluates employee performance according to the owner’s standards.C. A manager makes out the weekly work schedules, hires employees, and supervises a department.D. A manager selects the products to be sold for a business and selects the employees who will work in

each business activity.

4.1 pt(s).

Which of the following is most likely to result from specialization of labor:

A. Decreased training time

B. Decreased production ratesC. Decreased skill level




D. Decreased work quality

5.1 pt(s).

What technique is a company using to combat the disadvantages of labor specialization when it allowsemployees to decide what will improve customer satisfaction?

A. Job rotationB. Job enlargement

C. Job enrichment

D. Job satisfaction

6.1 pt(s).

The use of robots in assembly-line work is a form of specialization involving

A. capitalism.B. natural resources.

C. capital goods.

D. human resources

7.1 pt(s).

The cost of defect correction

A. decreases the further along the product is in the development phase

B. is less costly the earlier they are corrected

C. is not a factor in management quality decisionsD. is only considered in the planning or strategic phases

8.1 pt(s).

Warranty claims, customer complaints, and costs of litigation are examples of __________ costs.

A. Internal failure

B. External failure

C. Appraisal or InspectionD. Prevention

9.1 pt(s).

Costs of quality inspections, testing, test equipment, and labs are examples of __________ costs.

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A. Internal failureB. External failure

C. Appraisal or Inspection

D. Prevention

10.1 pt(s).

TQM stands for:

A. Total Quality MeasurementB. Total Quality Mistakes

C. Total Quality Management

D. They Quickly Mutate

11.1 pt(s).

Quality is defined by

A. Management

B. Customers

C. InspectorsD. Employees

12.1 pt(s).

When a country or company is the only source of a resource it is said to have a(n)

A. Competitive AdvantageB. Strategic Atvantage

C. Absolute Atvantage

D. Comprehensive Atvantage

13.1 pt(s).

When a country exports more than it imports it has a trade __________.

A. deficet

B. surplus

C. imbalanceD. defect



14.1 pt(s).

A country's balance of payments includes the balance of trade and

A. foreign investmentB. foreign aidC. military expendituresD. money spent by tourists

E. all of the above

15.1 pt(s).

Which of the following is not a barrier to trade

A. Poorly developed infrastructreB. Import TarriffsC. Political unrest

D. Tax incentives

16.1 pt(s).

Relocating a business process to another country is called

A. Cntract ManufacturingB. Outsourcing

C. Offshoring

D. Joint Venture

17.1 pt(s).

Partnering with a company in another country to share costs and operation of business is called

A. Contract ManufacturingB. OutsourcingC. Offshoring

D. Joint Venture

18.1 pt(s).

Hiring a company in another country to produce a specified volume of product meeting specifications iscalled

A. Contract Manufacturing

B. Outsourcing



C. OffshoringD. Joint Venture

19.1 pt(s).

Transferring manufacturing or tasks to a company in another country is called

A. Contract Manufacturing

B. Outsourcing

C. OffshoringD. Joint Venture

20.1 pt(s).

When a company decides to own production facilities in another country it is called

A. Strategic allianceB. Multinational strategy

C. Direct investment

D. Global strategy

21.1 pt(s).

In which of the following occupations would employees be organized into craft/trade unions:

A. Hotel employeeB. Restaurant workerC. Salesperson

D. Plumber

22.1 pt(s).

When union members of Local 654 arrived at work today, they found a sign on the door stating that thebusiness had closed temporarily and the employees were not allowed to work. This is a pressurestrategy known as a(n)A. injunction

B. lockout

C. boycottD. strike vote

What kind of strike occurs when the members of a union local stop work because another union at the



23.1 pt(s). company has gone on strike?

A. Sympathetic

B. LimitedC. JurisdictionalD. Wildcat

24.1 pt(s).

The lowest level of labor union organization is the

A. stateB. federation

C. local

D. national

25.1 pt(s).

When management and union leaders negotiate but cannot reach an agreement, either one may call fora(n)

A. grievanceB. injunction

C. arbitrator

D. probation

26.1 pt(s).

A U.S. company begins selling its products in Switzerland. Despite brisk sales, the company doesn'tmake enough profit to cover its expenses. When setting prices, the company simply used the sameprices in both countries. For example, $5.99 = 5.99 Swiss francs; $2.89 = 2.89 French francs. What riskof international business did the company not consider?A. Language variations

B. Currency fluctuations

C. Differences in lawsD. Opportunity costs

27.1 pt(s).

Which of the following is a fixed cost?

A. Raw materials costsB. Shipping Costs

C. Salaries



D. Packaging CostsE. All of the above are fixed costs.

28.1 pt(s).

Breakeven analysis identifies the

A. profit-maximizing level of outputB. level of output where variable cost is equal to zero

C. level of output where total revenue is equal to total cost

D. the level of output where fixed cost is equal to variable cost

29.1 pt(s).

A toy manufacturer’s expense equation is E = 45,500 + 14.32q What are the variable costs to produceone widget?

A. 14.32

B. qC. 45,500D. E

30.1 pt(s).

The Catania Cat Corporation manufactures litter boxes for cats. Their expense function is E = 20.00q +50,000. Find the total cost of producing 10,000 litter boxes.

A. 10,000

B. 250,000

C. 20.00D. 50,000

31.1 pt(s).

Why should productivity be measured?

A. To find new ways to meet customer needs

B. To see whether the business's objectives are being met

C. To determine the best ways to invest company profitsD. To locate new sources of inputs

32. One way for a business to increase productivity is to increase its



1 pt(s).A. importsB. environmental concernC. prices

D. research and development

33.1 pt(s).

Involving employees in redesigning a production line to gather their suggestions and experience is anexample of.

A. mass production

B. participative decision making

C. training and educationD. quality of work life

34.1 pt(s).

To reduce the chance of investigations and orders to cease production, businesses should

A. adhere to government regulations

B. specializeC. purchase the most up-to-date technology availableD. obay members of Congress

35.1 pt(s).

What is the effect on society of a falling growth rate in productivity?

A. Resources are used more efficiently

B. The standard of living drops

C. Inflation is preventedD. Increased labor disputes may occur

36.1 pt(s).

A country's standard of living can be calculated by dividing the goods and services by the

A. social services

B. population

C. outputD. total production



37.1 pt(s).

Mary is a bagger at Glen's Market. On a weekly average, she works 20 hours and fills 600 bags ofgroceries. Her productivity is ___________ bags of groceries per hour.

A. 30

B. 33C. 27D. 60

38.1 pt(s).

Dividing the dollar value of total sales by the cost of making those sales is one way that businessesoften measure their

A. accountabilityB. profitabilityC. liability

D. productivity

39.1 pt(s).

Wexler’s manufactures widgets. They create a monthly expense equation of all expenses in one month ofmanufacturing. The expense equation is E = 2.10q + 7,600. They plan to sell the widgets to retailers ata wholesale price of $3.50 each. How many widgets must be sold so that the income from the widgets isequal to the expenses of producing them? Round to the nearest widget.A. 4,521B. 7,600C. 3,456

D. 5,429

40.1 pt(s).

If two employees each work 40 hours a week and produce a total of 8,000 items, what is their totalhourly productivity level?

A. 100 items/hour

B. 200 items/hourC. 400 items/hourD. 500 items/hour

41.1 pt(s).

A tax on the amount of money that a person or company earns is called

A. excise tax



B. tarrifC. property tax

D. income tax

42.1 pt(s).

A tax on a specific commodity like gasoline or liquor is

A. excise tax

B. tarrifC. property taxD. income tax

43.1 pt(s).

A tax on imported goods is

A. excise tax

B. tarrif

C. property taxD. income tax

44.1 pt(s).

A tax system that taxes the wealthy at a higher rate than the poor is

A. RegressiveB. Proportional

C. Progressive

D. Unfair

45.1 pt(s).

A tax system that taxes everyone at the same rate regardless on income is

A. Regressive

B. Proportional

C. ProgressiveD. Unfair



46.1 pt(s).

A tax system that taxes the wealthy at a lower tax rate than the poor is

A. Regressive

B. ProportionalC. ProgressiveD. Representative

47.1 pt(s).

Governments use tax revenue to

A. Build transportation infrastructureB. Provide social servicesC. Build and maintain parks and monumentsD. Provide safety and defense resources

E. All of the above

48.1 pt(s).

Sales taxes are an example of

A. Regressive tax

B. Proportional tax

C. Progressive taxD. Representative tax

49.1 pt(s).

A tax that is paid by the survivors of a person who has died is

A. Property taxB. Exise Tax

C. Estate tas

D. Income tax

50.1 pt(s).

The Internal Revenue Service (IRS) is responsible for

A. Collecting Federal Income tas

B. Decidng how to use tax revenueC. Collecting sales tax



D. Collecting inport tarifs











Bus Econ Test 3Quiz Directions

You will have one attempt to take this test.

Questions

1.1 pt(s).

One of the main functions of a country's monetary policy is to

A. monitor government spending.B. approve the annual budgetC. levy taxes

D. manage the supply of money

2.1 pt(s).

An easing of monetary policy is often used to correct the problem of

A. globalization and outsourcingB. high taxes.and deficet spending

C. unemployment and inflation

D. import quotas and trade deficets

3.1 pt(s).

Which of the following expansive monetary policy actions would the Federal Reserve System take toexpand the money supply?

A. Raise the Federal Discount Rate

B. Buy securities on the open market

C. Increase Reserve RequirementsD. Open additional financial institutions

4.1 pt(s).

Which of the following represents a good time for a country's government to use its fiscal policy toincrease taxes:

A. While the economy is expanding

B. When a recession lasts too longC. When inflation is too highD. While the economy is contracting




5.1 pt(s).

A government's fiscal policies that are intended to encourage economic growth are known as__________ policies.

A. appropriateB. complementary

C. expansionary

D. realistic

6.1 pt(s).

If a government wants to decrease economic growth, it would use a contractionary fiscal policy thatmight involve

A. increasing government spending.

B. increasing taxes.

C. decreasing regulations.D. decreasing unemployment.

7.1 pt(s).

Which of the following actions would government take to increase economic growth:

A. Decrease exportsB. Increase taxes

C. Increase government spending

D. Decrease government subsidies

8.1 pt(s).

What type of government policy involves raising or lowering taxes, and increasing or decreasinggovernment spending?

A. DisciplinaryB. Monetary

C. Fiscal

D. Social

9.1 pt(s).

Which of the following government actions is most likely to stimulate the economy

A. Raising the prime interest rateB. Lowering tax rates



C. Printing less moneyD. Borrowing more money

10.1 pt(s).

The government uses some of the tax money it collects from individuals and businesses to supportpublic welfare programs. What is the benefit of these welfare programs to businesses in a privateenterprise economy?A. Recipients don't have to work.B. Businesses must budget more money for taxes.

C. Funds received by recipients are spent in businesses.

D. Government has control of how the recipients spend their money.

11.1 pt(s).

A business must find ways to reduce costs

A. when consumer demand increasesB. when job growth is high

C. when the gorss domestic product falls

D. when interest rates are low

12.1 pt(s).

What usually results when interest rates continue to decrease?

A. Spending decreases.B. Production decreases

C. Purchasing power increases.

D. Unemployment rises

13.1 pt(s).

Interest rates rising and falling by a wide range on a regular basis often are an indication of

A. seasonal unemployment.

B. economic instability.

C. flexible capital.D. price equilibrium.



14.1 pt(s).

Why does the Federal Reserve System reduce interest rates?

A. To increase demand for productsB. To overcome inequalities of income distributionC. To decrease supply of products

D. To stimulate the economy and reduce unemployment

15.1 pt(s).

If interest rates go up, which of the following would most likely occur:

A. Banks will pay more to borrow money.

B. The stock market will go up.C. Consumers will spend more.D. U.S. exports will increase

16.1 pt(s).

How long do most business cycles last?

A. Two full yearsB. Two consecutive quartersC. At least 10 years

D. Varying lengths of time

17.1 pt(s).

During which phase of the business cycle would there most likely be highest unemployment of workersin certain skill areas?

A. Trough

B. ExpansionC. PeakD. Contraction

18.1 pt(s).

When producers are pessimistic about the economic business outlook, they often

A. Increase their inventory levels.

B. decrease their purchase of new goods.

C. increase their investment in capital goods.D. reduce their investment in savings.



19.1 pt(s).

During the peak phase of a business cycle, a business could be expected to have

A. increased sales

B. reduced sales.C. low profits.D. staff reductions.

20.1 pt(s).

When a business cycle is affected by international relations, new discoveries, and social or politicalchanges, it is said to have been changed by __________ factors.

A. extraneous

B. external

C. internalD. intrinsic

21.1 pt(s).

As the gross domestic product decreases, it is harder for all levels of government to

A. maintain trade surplusses

B. carry out their functions.

C. decrease their spending.D. sell bonds

22.1 pt(s).

What often happens when a nation has a high unemployment rate?

A. The gross domestic product increases.B. The consumer price index decreases.

C. The nation experiences an economic slowdown.

D. The stock market remains unaffected.

23.1 pt(s).

Which of the following statements is true regarding a nation's unemployment rates:

A. Globalization does not usually have a major effect on a nation's unemployment rates.



B. A nation's business cycles do not usually impact the country's unemployment rates.

C. A nation always has a natural percentage of unemployed citizens at any given time.

D. During times of great expansion, a nation's workers are generally underemployed.

24.1 pt(s).

Prolonged unemployment can lead to

A. A reduction in education due to pessimism about its valueB. Increase in crimeC. Protectionism and restrictions on immigrationD. Reducion in tax revenue for all levels of government correct answer choice answer choice you marked

E. All of the above

25.1 pt(s).

Unemployment slows the circulation of money in the economy by

A. decreasing the supply of moneyB. reducing the interest rates on loansC. closing banks

D. reducing the amout of consumer spending and demand for goods and services

26.1 pt(s).

Unemployment benefits help replace lost income but will usually be

A. 85% of regular incomeB. 60% of regular income

C. 50% of regular income

D. 25% of regular income

27.1 pt(s).

During periods of high unemployment there are non-financial impacts to individuals. Which of thefollowing are NOT one of these impacts?

A. mental health of unemployed workers

B. job enrichment of enemployed workers

C. physical health of unemployed workersD. education and training of unemployed workers



28.1 pt(s).

What percent of the U.S. economy does consumer spending represent

A. 25% -30%B. 35%-40%C. 50%-55%

D. 70%-75%

29.1 pt(s).

A significant cause of recession/depression is

A. over indebtedness

B. technology replacing workersC. increased savingsD. increased trade surplus

30.1 pt(s).

The principle discovered and developed by the French economist Jean-Baptiste Say in the earlynineteenth century known as Say’s Law says:

A. demand drives the growth of the economy. Consumers and bussinesses demand for goods andservices are the keys to economic growth.

B. supply drives the growth of the economy. Savings, productivity, and technological advances are thekeys to economic growth.

C. consumer spending is the most important component impacting economic growthD. economic growth takes place when the demand and supply are in equilibrium

31.1 pt(s).

Why might businesses decide to hold on to products to sell later when the economy is experiencing highlevels of inflation?

A. Taxes will limit production.

B. Prices will continue to rise.

C. Cash will be in short supply.D. Income will remain constant.

32.1 pt(s).

When consumers' purchasing power increases, the economy will experience a period of

A. contraction.B. expansion.



C. containment.D. emergence.

33.1 pt(s).

When consumer prices are increasing rapidly, the economy usually is in a(n)

A. depression.

B. inflationary period.

C. expansionD. recession.

34.1 pt(s).

Which of the following would policy makers monitor to understand personal consumption expenditures(PCEs):

A. S&P 500 Stock IndexB. Consumer Price Index (CPI)C. Real Gross Domestic Product (GDP)

D. Retail Sales

35.1 pt(s).

When consumer spending and consumption increase, consumer confidence tends to

A. fall.

B. rise.

C. remain the same.D. be unpredictable.

36.1 pt(s).

When a nation's inflation rate is high, prices tend to

A. increase dramatically.

B. remain stable.C. change slowly over timeD. increase currency values



37.1 pt(s).

The role of an entrepreneur in the U.S. economy is:

A. To stablize the growth of the economy and provide advice to policy makers.B. To stop inflation and build a trade surplus.

C. To develop innovative products and services using their own resources.

D. To manage the supply of money in the economy.

38.1 pt(s).

Early U.S. economic activity centered around

A. industrial innovationB. servicesC. financial investments

D. agriculture

39.1 pt(s).

The period of history when new and innovative technology was first introduced and specialization oflabor became a trend is called

A. Westward Expansion

B. Industrial Revolution

C. Service and Digital EconomyD. Manufacturing and Marketing Economy

40.1 pt(s).

Which of the following is NOT a role that the U.S. government plays in the economy

A. regulating financial and banking activitiesB. managing the supply of moneyC. promoting competition

D. controlling the production of goods and services

41.1 pt(s).

A business cycle refers to

A. fluctuations in the general price level.B. changes in the long-term growth pattern of the CPI.

C. the ups and downs of real GDP.

D. fluctuations in the level of corporate profits.



E. seasonal unemployment patterns.

42.1 pt(s).

Gross domestic product constitutes

A. the current market value of all final goods and services produced in a given year within a country’sborders in a year.

B. the total monetary transactions in an economy.C. the total spending in an economy.D. the total quantitative output in an economy.

43.1 pt(s).

Fiscal policy in the United States is the result of

A. a yearly budget process involving both the president and Congress.

B. a five-year budget plan overseen by the Office of Management and Budget.C. a joint budget resolution by federal agencies.D. a decree by the president.

44.1 pt(s).

Money is

A. a form of credit.B. an indicator of the scarcity of wants.

C. anything that sellers accept in exchange for goods and services.

D. a form of barter.

45.1 pt(s).

When your grandmother keeps her savings hidden under her mattress, she is using money as

A. a unit of account.B. a standard of deferred payment.C. a medium of exchange.

D. a store of value.

46. The functions of money do not include



1 pt(s).

A. an exchange of purchasing power.

B. a unit of account.C. a standard of deferred payment.D. a medium of exchange.

47.1 pt(s).

Automatic stabilizers

A. counter balance fluctuations in economic activity

B. reinforce fluctuations in economic activityC. do not occur when the economy falls into recessionD. reduce the size of the deflationary gap

48.1 pt(s).

If the government wishes to reduce the level of economic activity in the economy, appropriate fiscalpolicy would be

A. government bond sales by the Federal Reserve

B. decrease spending and/or increase the level of taxation

C. increase spending and/or decrease the level of taxationD. decrease spending and/or decrease the level of taxation

49.1 pt(s).

If you are a classical economist, which statement would you support?

A. Let the economy work out its own problems

B. The more the government spends to improve the economy, the betterC. The government should be involved to help during recessionsD. The government is the key to economic success

50.1 pt(s).

During periods of inflation

A. those people who have fixed incomes benefit.B. those people who hold a lot of cash benefit.C. those people who enter long-term wage agreements benefit.

D. those people whose real income rises faster than the general price level benefit.

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