econ quizzes

One cause of inflation is . . . a. costs of production rise, so producers have to raise prices. b. consumer demand decreases, and the law of demand is not obeyed. c. business inventories grow, and there is a surplus of goods and services. td. he money supply is tightened, so there is less money in circulation.

a

The difference between real and nominal GDP is that real GDP is adjusted for a. inflation b. entitlements c. international trade d. unemployment

a

Unexpected inflation will have the biggest impact on people a. who live on a fixed income. b. who have money in the stock market. c. who have fixed-rate loans. d. who have entry-level jobs.

a

What is the most basic economic issue for all societies? a. Scarcity b. Taxation c. Inflation d. Recession

a

Which of the following is NOT a characteristic of a command economy? a. The government strives to give people freedom. b. The central government owns the factors of production. c. Each person is assigned a job and paid a wage determined by the government. d. Economic planning is done by the government.

a

Which of the following is an opportunity cost of building a new public high school? a. Other goods and services given up in order to build the school b. Cost of hiring teachers for all subjects at the new school c. Cost of constructing the new school at a later date d. Change in the annual tax rate to pay for the new school

a

Which of the following people would be considered unemployed? a. a man who is not working but has an interview set up for next week. b. a 15-year-old boy. c. a stay-at-home mom d. a woman who isn't working and has given up looking for a job.

a

Which of the following statements most accurately describes how inflation affects purchasing power? a. Inflation causes purchasing power to decrease. b. Inflation causes purchasing power to increase and then decrease. c. Inflation does not affect purchasing power. d. Inflation causes purchasing power to increase.

a

A worker was laid off from a part-time job at Wild Mountain Ski Resort when the snow melted and the spring season hit. This worker would now be considered a. frictionally employed b. seasonally unemployed c. cyclically unemployed d. structurally unemployed

b

Bart Simpson has $50 that he is thinking of using to buy a new skateboard. Instead, he could use it to buy an IPOD shuffle, a state-of-the-art slingshot, or a gift card for his sister, Lisa. If Bart spends the $50 on the skateboard, a. he does not have an opportunity cost in this situation. b. his opportunity cost is whichever of the other three alternatives he values the most. c. his opportunity cost is whichever of the other three alternatives he values least. d. his opportunity cost is all of the other three things.

b

In economic terms, what are land, labor, capital and entrepreneurship? a. Opportunity costs b. Factors of production c. Production possibility d. Production trade-offs

b

In the circular flow model, which of these is a factor of payment? a. The credit card charge for ordering games online. b. The hourly wage a store pays to a cashier. c. the check someone writes to buy groceries. d. The monthly mortgage on a house.

b

The official unemployment rate might be inaccurate because it ignores a. workers in the illegal economy who do not report their jobs. b. discouraged workers who have given up looking for a job. c. senior citizens who have retired. d. parents who are not in the workforce, because they are caring for young children.

b

What is the best title for the list below? Innovator Strategist Risk-Taker a. Manager b. Entrepeneur c. Laborer d. Investor

b

What is the economic system in which customs and religion of previous generations determine how the economy will use its scarce resources? a. Transitional b. Traditional c. Command d, Market

b

When comparing a traditional economy with a command economy, which of the following is true of both? a. Private ownership of business b. Slow economic growth c. Support of business competition d. Freely fluctuating prices

b

Which of the following countries exhibit the greatest number of characteristics of a market economy? a. China b. United States c. Cuba d. North Korea

b

Which of the following is NOT one of the sectors used to calculate GDP? a. imports b. foreign investment c. exports d. business investment

b

Why are all goods and services scarce? a. Some things are needs and others are wants. b. All resources are scarce. c. Some goods cost more than others. d. Some people want to have more goods than others.

b

A company decides to install more machines and lay off workers. Which economic question is addressed directly? a. For whom to produce b. What to produce c. How to produce d. Where to produce

c

A decline in economic activity (and real GDP) over a period of time of at least six months is called a a. depression b. contraction c. recession d. panic

c

A teacher is an example of: a. capital b. an entrepreneur c. labor d. land

c

A worker lost his/her job at a telephone company because the company installed an automated phone system. Which type of unemployment did the worker experience? a. seasonal b. frictional c. structural d. cyclical

c

In general, what type of economy does the United States have? a. Traditional b. Transitional c. Market d. Command

c

What is the factory building an example of? a. an economic trade-off b. technology c. physical capital d. human capital

c

Which of the following is characteristic of a traditional economy? a. They have a high standard of living. b. Communities tend to be fast-growing. c. Children tend to have the same jobs as their parents did. d. they are usually based on light industrial production.

c

Which of the following would occur during the expansion phase of the business cycle? a. Decreasing GDP and deflation. b. increasing unemployment rate and declining GDP. c. increasing GDP and decreasing unemployment. d. falling inflation and falling employment.

c

Which type of economy produces the highest standard of living for its citizens? a. Command b. Transitional c. Market d. Traditional

c

which of the following would be used in calculating gdp? a. the sale of a 25-year-old house. b. grains used to produce cereal. c. a laptop computer purchased at Best Buy. d. toys manufactured in China at a factory owned by a U.S. company.

c

Instead of buying a ticket to a concert, you wait in line al night to get free tickets being given away at a local radio station. You: a. do not bear an opportunity cost because the ticket was free. b. do not bear an opportunity cost because all you gave up was some sleep. c. bear an opportunity cost, which is the price you would have paid for the ticket. d. bear an opportunity cost, which is what you would have otherwise done with your time.

d

Jenny has enough money to buy either a CD or to go to a movie with her friends. In economics, what is the choice that Jenny "gives up" called? a. Negative cost b. Positive cost c. Marginal cost d. Opportunity cost

d

The circular flow model is: a. a chart of financial transactions. b. a chart of quantities of production. c. an analysis of production categories. d. a diagram of interactions in open markets.

d

What is the benefit of competition in a free market system? a. Follow the traditional methods of production b. Cause producers to try to put each other out of business c. Make sure everyone gets an equal share of resources d. Create a variety of new and cheaper products

d

What is the main idea behind the study of economics? a. Monetary policy b. Business decisions c. Efficiency of production d. Allocation of scarce resources

d

What is the primary incentive that motivates a manufacturer to sell a product? a. Reputation of the product b. Pleasing the government c. Putting others out of business d. Making profits on sales

d

Which of the following indicators is most often used to assess standard of living? a. stagflation b. inflation c. unemployment rate d. gross domestic product

d

Which of the following is NOT a key economic question? a. How are goods and services to be produced? b. For whom are goods and services to be produced? c. What goods and services are to be produced? d. How should it be ensured that goods and services are paid for?

d

Why are final goods included in the calculation of GDP, while intermediate goods are not? a. Intermediate goods are not as popular as final goods. b. Intermediate goods already include the value of final goods. c. Final goods are not as popular as intermediate goods. d. Final goods already include the value of the intermediate goods.

d

Why is the unemployment rate above zero when the economy reaches full unemployment? a. There are never enough jobs for everyone who want one. b. Most workers do not have enough training for the best jobs. c. Most jobs lay off workers when the economy is slow. d. There are always some people in transition between jobs.

d

A civil engineer who decides to resign from the job to pursue a more "exciting" career would now be considered a. frictionally unemployed b. a discouraged worker c. employed d. structurally unemployed

a

Deflation is good for . . . a. consumers b. business c. borrowers d. no one

a

Economics is the study of how people choose to use their _____ resources to satisfy their _____ wants. a. limited; unlimited b. unlimited; unlimited c. limited; limited d. unlimited; limited

a

In every economic system, what must people choose to do? a. Make the best use of scarce resources b. Create an equal distribution of income c. Save money to reduce the national debt d. Satisfy all the wants of their society

a

In which phase of the business cycle will you likely see unemployment? a. contraction b. expansion c. all of the above. d. peak

a

Money is an example of : a. None of above b. physical capital c. labor d. land

a