Econ Exam
according to Hazlitt which of the following would be consequences of the United States placcing a new tariff on foreign sweaters, resulting in the creation of a domestic sweater industry
- american consumers would be forced to subsidize this industry - there would be no net addition to american industry or employment
which of the following would be hurt by a weak dollar
- an American company that buys steel from China - an American consumer buying products from England - and American traveling to Germany
which of the following are possible causes of a higher unemployment rate
- cyclical fluctuations in the level of national spending - changes in the skills needed by employers - people changing jobs
trade barriers are harmful to which of the following groups
- foreign producers in the affected industries - domestic consumers
which of the following are challenging for entrepreneurs
- high financial commitment - high levels of stress - high time commitment
inflation has a negative impact on which of the following groups
- people with a lot of savings - people living on a fixed income
list three of the four main incentives of entrepreneurship
- profit - independence - pursing a passion - helping others
what organizations are responsible for regulating financial markets in the US
- securities and exchange commission - federal reserve system
hazlitts arguments against tarriffs are directed against which of the following fallacies
- that tariffs raise wages - that tariffs provide employment - that tariffs protect the American standard of living
what happens whan all nations specialize in the areas in which they have comparative advantages
- the global standard of living increases - total world production increases
which of the following are disadvantages or corporations
- their owners are subjected to double taxation - they are more complicated and expensive to establish than other business structures
which of the following are advantages of partnerships
- their owners dont have to pay any special business taxes - they are generally easy and inexpensive to start - their owners can share responsiblities based on their different skills
which of the following are disadvantages of sole proprietorships
- their owners have unlimited personal liability - their owners usually have linited financial resources
which of the following are advantages of cooperatives
- their owners often get discounts on the goods and services produced by the cooperative - their owners dont have personal liability for the business - their owners all have a say in how the business is run
According to Hazlitt, many proponents of inflation realize it will decrease the purchasing power of money and increase the price of goods and services. what are reasons these proponents of inflation want inflation anyway
- they believe it will stimulate imports and discourage exports - they believe it will jump start industry and lead to full employment - the believe it will improve the position of creditors as a compared with debtors -they believe its an essential measure to cure a depression
which of the following are reasons that trade barriers are established
- to apply diplomatic pressure to a foreign government - to strengthen national defense - to protect domestic industries that would be hurt by free trade
which of the following are main goals of the Securities and exchange Commission
- to protect investors - to ensure that financial markets are fair, and efficient
in the US the highest level of inflation since the Great Depression occurred in 1979. What was the percentage of inflation in 1979
13%
at the height of the Great Depression in 1933 the unemployment rate reached a high of
24.9%
from 2009 to 2020 the exchange rate between the euro and the US dollar varied over time. During that time the number of euros you wouldve recieved for the 100 ranged from
70-95 euros
in one sentence, define the term absolute advantage
Absolute advantage is when one nation is able to produce a product at a lower cost then the other
in the US the most common way to measure the effect of inflation in the CPI which stands fro
Consumer Price index
Which verse says, "There is nothing better for a person than that he should eat and drink and find enjoyment in his toil?"
Ecclesiastes 2::24
which verse says, "in the same way, let your light shine before others, so that they may see your good works and give glory to your Father who is in heaven"?
Matthew 5:16
established in 1994 this treaty created of free trade between Canada, Mexico, and the United States
NAFTA
the largest stock market in the world is the
New York Stock Exchange
if Country A can produce wheat at a lower cost than Country B, the Country A has a _____ advantage in wheat production
absolute
who wrote in defense of free trade "in every country it always is and must be the interest of the great body of the people to buy whatever they want of those who sell it cheapest
adam smith
which of the following would be hurt by a strong dollar
an american farmer who exports corn from the middle east
in the video about entrepreneurship why was the owner of Clean & Mean able to craft her work schedule in a way that allowed her to go to the mall with her mom on Friday mornings
because of the level of independence offered by entrepreneurship
which presidential candidate issued a universal jobs guarentee during the 2020 democratic primary
bernie sanders
entrepreneurs develop new products and start new businesses by
bringing natural, human, and capital resources together
Hazlitt writes the most obvious error on which the appeal of inflation rests is
confusin money with wealth
when businesses raise prices to cover increasing costs it results in
cost pull inflation
deflation
decrease in general price
one potential cause of unemployment in seasonal fluctuations in
demand
monetary inflation can create a chain reaction that results in even more inflation. This occurs because monetary inflation can cause _____ when people recognize that the value of their money is going to decline in the future
demand pull inflation
when demand for goods and services becomes greater than supply it results in
demand pull inflation
hazlitt writes that the fundamental fallacy of looking only at certain groups instead of at everyone "is an almost inevitable result" or what
division of labor
one way that nations can control the value of their currency is by establishing a ____ in which the value of a currency is set at a specific value relative to another currency or some other measure of value
fixed exchange rate
Hazlitt argues that "nothing is easier to achieve than full employment" when its "taken as an end to itself" instead of being tied to the goal of
full production
hazlitt writes that economics should be concerned not only with some special interest in the short run but with the ____ interest in the long run
general
histrically many countries used to fix their currency to a set amount of
gold
name four countries that the United States has a free trade agreement with
guatemala canada mexico peru
which of the following can discourage the creation of new businesses
high tax rates
which of the following scenarios would likely result in demand-pull inflation
increased government spending
because of _____ the worlds nations have becoming increasingly interdependent economically
increased specialization
if someone trades a stock based on confidential nonpublic knowledge about that stock they have sommitted
insider trading
Hazlitt admits that inflation might sometimes be able to correct the causes of an economic depression but that is a dangerous method because
it makes its corrections not openly and honestly but by the use of illusion
when american companies move production overseas, it is called
offshoring
when American companies send work to businesses or workers in other countries it is called
outstanding
a business with two or more owners is called a
partnership
a limit on the quantity of a product thats allowed into a nation is called a
quota
hazlitt writes that economics is a science of recognizing ____ consequences
secondary
in Nearing Home, Billy Graham writes that "someone who brags about working seventy or eighty hours a week" has become a ____ of his of her job
slave
proverbs 19:15 says, "slothfulness casts into a deep ____ and an idle person will suffer hunger
sleep
in adam smiths theories free trade was considered as one aspect of the _____ if labor
specialization
in chapter 9 of Economics in one lesson Hazlitt discusses that there is often a fear that there wont be enough jobs for soldiers when they return to the workforces after a war. Hazlitt admits that it may require some time for private industry to provide jobs for all these new workers. he writes that in the past the chiefly remarkable thing about getting jobs for all the former soldiers has been the ______ with which the process was accomplished
speed
in the story about Milton Friedman visiting an overseas construction site Friedman suggesdts that more jobs could be created by taking away the workers shovels and giving them
spoons
Of the following investments, which has historically had the best performance over the long term but suffers from more volatility
stock
when a nation exports more goods than it imports it has a trade
surplus
list the three economic goals that the US federal government seeks to achieve
the US federal government seeks to keep stable prices, increase the nations GDP, and lower unemployment rates
what is one key element that encourages people to trade
the ability to buy a particular good from someone else cheaper than it costs to make it yourself
why do politicians often establish trade barriers even through the barriers usually do more harm then good
they are incentivized to create policies that disperse costs over a large number of people but benefit small, powerful groups
what does Hazlitt say is the goal of economic science
to see the problem as a whole and not in fragments
the justification for public jobs like police officers, firefighters, judges, and legislators does not consist in the purchasing power they possess by virtue of being on the public payroll but instead consists in the ____ of their services
utility
in the past, the United States has been so focused on exporting goods that they gave other nations loans to pay for the goods American exported to them. But if these loans are never repaid in means that
we are giving to goods away
when we make a voluntary trade, we are exchanging one item for another one item for another because
we value the item acquired more than what we're giving up
genesis 2:25 says, "the Lord God took the man and put him in the garden of Eden to ___ it and keep it"
work