ECONOMICS - 8.3/8.4/12.2

A formal contract to repay borrowed money with interest at fixed intervals is a a. bond. b. stock. c. dividend. d. certificate.

a

A steady, long-term increase in real GDP is a. economic growth. b. a depression. c. a peak d. a recession

a

Business investment, interest rates and credits, consumer expectations, and external shocks are the four main factors that affect a. the business cycles. b. gross national product. c. gross domestic product. d. real GDP

a

How would a rise in business investment affect the aggregate demand curve? a. The aggregate demand curve shifts to the right. b. The aggregate demand curve shifts to the left. c. The aggregate demand curve becomes more horizontal. d. There is no change of the aggregate demand curve.

a

What is a recession? a. a period when real GDP falls for at least 6 months b. a long and severe depression c. a very mild and short expansion d. a period when the economy is neither expanding nor contracting

a

What is the Securities and Exchange Commission (SEC)? a. a federal agency that regulates the stock market b. a trade association of publicly held corporations c. a business association for stock and bond traders d. a federal agency that buys and sells stocks and bonds

a

Which of the following is NOT an example of a professional organization? a. the American Red Cross b. the National Education Association c. the American Medical Association d. the American Management Association

a

Who manages a corporation? a. board of directors and managers b. shareholders and banks c. original owners and shareholders d. the Securities and Exchange Commission

a

--------- Which of the following is NOT an example of a nonprofit organization? a. a museum b. an adoption agency c. a fast food franchise d. a synagogue, temple, or church

c

A decline in real GDP combined with a rise in the price level is a. a recession. b. a depression. c. stagflation. d. a trough.

c

All of these statements about recessions are true EXCEPT a. a recession is a prolonged economic contraction. b. a fall in real GDP for two consecutive quarters marks a recession. c. a recession is usually no longer than 6 months. d. a long and severe recession might be referred to as a depression.

c

An agricultural marketing cooperative that helps members sell their products is a a. consumer cooperative. b. service cooperative. c. producer cooperative. d. professional cooperative.

c

During the contraction phase of the business cycle, GDP a. is rising. b. stops rising. c. is always falling. d. is not changing.

c

The average of all prices in the economy is the a. aggregate supply. b. aggregate demand. c. price level. d. gross national product.

c

The basic measure of a nation's economic growth rate is the a. non-market activities. b. leading indicators. c. percentage change of real GDP over a given period of time. d. standard of living.

c

The portion of corporate profits paid out to stockholders is a. a bond. b. stock. c. a dividend. d. a merger.

c

Three of the four main economic variables are a. business investment, recession, and stagflation. b. interest rates, disposable income, and GDP. c. external shocks, business investment, and interest rates. d. consumer expectations, external shocks, and depression

c

A franchise owner's share of earnings given as a payment to a parent company is called a. an asset. b. a dividend. c. a bond. d. a royalty.

d

A period of economic growth as measured by a rise in real GDP is a(n) a. business cycle. b. peak. c. contraction. d. expansion.

d

A vertical merger is a. a corporation that issues stock to only a few people, often family members. b. a business combination merging more than three businesses that make unrelated products. c. the combination of two or more firms competing in the same market with the same good or service. d. the combination of two or more firms involved in different stages of producing the same good or service.

d

All of the following are situations involving external shocks EXCEPT a. consumers pay high prices for corn because of a severe drought. b. consumers reduce spending on expensive goods because the country has gone to war. c. consumers increase their consumption of gasoline because of lower prices due to the discovery of large deposits of oil. d. consumers reduce spending because they fear that their nation is going to war.

d

The stage in a business cycle when real GDP stops falling is a. expansion. b. the peak. c. contraction. d. the trough.

d

Which of the following is NOT a kind of cooperative? a. consumer cooperative b. service cooperative c. producer cooperative d. nonprofit cooperative

d

Which of the following statements is FALSE? a. A multinational company usually has headquarters in one country and branches in other countries. b. Multinational companies are sometimes called transnational corporations. c. Multinational companies account for more than $3 trillion of worldwide assets. d. A multinational company pays taxes only in the country in which it is headquartered.

d

A conglomerate is a. a large corporation that produces and sells its goods and services throughout the world. b. a business combination merging more than three businesses that make unrelated products. c. a corporation that sells stock on the open market. d. the combination of two or more firms involved in different stages of producing the same good or service.

b

A nonprofit organization that promotes the interests of a particular industry is a a. business association. b. trade association. c. labor union. d. professional organization.

b

A prolonged economic contraction that is not especially long or severe is referred to as a a. depression. b. recession. c. stagflation. d. trough.

b

A semi-independent business that pays fees to a parent company in return for the exclusive right to sell a certain product or service in a given area is called a a. cooperative. b. business franchise. c. nonprofit organization. d. trade association.

b

An institution that functions much like a business, but does not operate for the purpose of generating profits is a a. nonprofit organization. b. business franchise. c. consumer cooperative. d. labor union.

b

Key economic variables that economists use to predict a new phase of a business cycle are referred to as a. a recession. b. leading indicators. c. a contradiction. d. economic growth.

b

The license to form a corporation issued by state government is a a. multinational corporation. b. certificate of incorporation. c. conglomerate. d. dividend.

b

What is a business cycle? a. a period of increased economic growth b. a period of economic growth followed by economic contraction c. the amount of time it takes a business to produce its products d. a dangerous time for all businesses

b

What kind of organization is the Better Business Bureau? a. trade association b. business association c. labor union d. cooperative

b

What stage of the business cycle would be most appropriate to describe the years from 1929 to 1933? a. peak b. contraction c. trough d. expansion

b

Which of the following is a disadvantage faced by a franchise business owner that would not be encountered by an independent business owner? a. lack of management training and support b. franchising fees and royalties c. government regulations d. high cost of products

b

Which of the following is an example of a vertical merger? a. Three companies, one producing mayonnaise, one paper towels, and one bars of soap b. two companies, one producing engines, and the other producing engine parts c. six manufacturing companies, each producing video game systems d. two computer companies, each making and selling similar hardware

b

Why does the government carefully monitor horizontal mergers? a. It's possible for control to shift to a foreign-owned corporation. b. The resulting single firm might gain monopoly power in its market. c. Employee layoffs usually result. d. The new firm may discontinue some of the original firms' products.

b