Economics semester test
In witch type or types of economy do businesses compete for profit
Market economy and mixed market economy
In the United States, prices are set by
Markets
Capitalism
System where private citizens own means of production
Witch of the following is a benefit of credit
You can but things you want before you can save the entire purchase price
What are your drawbacks of credit
You will end up paying more that what the items costs due to interest. It can cause financial debt if not used responsibly
a nation is said to have______ when the value of its exports is greater than the value of its imports
a positive balance of trade
NAFTA created a protectionist zone in Europe
false
a countries with on going trade deficits will see the value of its currency rise
false
a country with more imports than exports has a trade surplus
false
most countries with a high per capita GDP have a command economy
false
trade barriers makes prices lower for U.S. consumers
false
protectionism is the use of tatics that make imported goods _____ than domestic goods
more expensive
do teams have to liquidate portfolios at end of trading session
no
will transactions entered with a limit price be held past the initial posting
no
in an end of day game witch days closing price will a trade entered on a friday at 630 will receive
price of monday
many developing countries try to protect domestic jobs by using trade barriers
true
relying on a single export makes a nations economy vulnerable
true
does the stock market game pay dividends
yes
Consumers participates only in the factor market and in the product market
True
GDP per capita is calculated by dividing a country's GDP by its population
True
Labor is one of the three types of resources indentified by economist
True
Many Americans work and save money so they can invest their money in property ownership
True
Price in the US are est. by supply and demand in markets
True
Prices play an important role in a market economy
True
Supply is affected by the number of suppliers and the cost of production
True
The US has the worlds largest economy
True
The government borrows money from citizens by selling them bonds
True
The government can act as a consumer in the product market
True
Using a credit is the same as borrowing money
True
When the marginal benefit is higher than the marginal cost, a business will decide in favor of a project
True
When the price of bananas goes down, the results will be greater demand or bananas
True
When you apply for credit, the lender checks your credit rating
True
impulse buying
Unplanned, emotional decision to buy something
Exchange rate
Value of one currency in terms of another currency
Economist refer to the activity that takes place in the market as
Voluntary change
private property rights
Freedom to own and use property at will
Stock
Shares of company held by an invested
Typically, both resources and wants are limited
False
Interest
Fee charged for borrowing money
what is the annual % rate interest rate that cash balances will earn
0.75%
what is the broker fee on all trades
1%
what is the minimum amount of shares for a buy order
10 shares
excludding interest earned, how much cash does each team begin the stock market game with
100,000
annual % rate charged to teams with a negative cash balance
7%
How does a bond differ from a stock
A bond is a loan to a company by a company a stock is you buying a share of the company
What 2 things are needed for economic growth
Additional resources increase productivity
APR (Annual Percentage Rate)
Annual cost of credit
Being a good consumer mean considering the effects of purchasing decisions
Avoid impulse buying, prioritize wants, think about opportunity cost
What are four sources of credit
Bank stores credit union and finance companies
The US government encourages competition between sellers by
Banning monopolies
What are the four sectors that work in the US economy
Business, consumer, foreign, and government
Witch of the following is most likely to have the highest rate of return
CD
A delivery truck is an ex of
Capital
Witch of the following words describe the flow of economic activity in a market system
Circular
What are the different types of economics discussed in this chapter
Command, traditional, market, and mixed
Expenses that do not change no matter how much a business produces are called
Fixed cost
Specialization helps improve productivity because it allows businesses to
Focus on what they do best
dividend
Company earning paid to shareholders
Using advertising carefully, comparison shopping, and reporting faulty products are al ex of
Consumer responsibility
A department store is trying to decide whether to expand its building to add a shoe department. To make a decision, the stores owner would compare
Cost and revenue resulting from the expansion
why do countrys trade with one another, and how do trade barriers harm economies
Countries don't have what they want and need gain comparative advantage
Comparative advantage
Country's ability to produce a good more efficiently than another country
Balance of trade
Difference between the value of a country's import and exports
Witch business strategy is demonstrated by the factory supervisor who breaks a large job into small, separate jobs
Division of labor
Free enterprise
Economic system where individuals an businesss make economic decisions
scarcity affects the global community by
Encouraging international trade
A business that makes a benefit-cost analysis to choose between projects should choose the project with the lower benefit cost number
False
As the price of a good goes up, producers tend to supply less
False
Choosing to spend a Sunday afternoon in the park playing soccer does not have an opportunity Cost
False
Factories are link between consumers and businesses
False
Someone may buy a generic good because it costs more than other goods
False
The business sector participated only in the factor market
False
The riskiest investment is a mutual fund
False
in a command economy how are the economic questions answered
Government planners
Witch sector uses both taxes and borrowing to operate
Government sector
Laissez- faire economics
Government should not interfere in market
developed country
Had a high standard of living
developing country
Has a low GDP per capita
mixed economy
Has characteristics of more than one type of economy
profit motive
Incentive to make money
Disposable income
Income after all taxes on it are paid off
The three basic parts of a budget are
Income expenses balances
discretionary income
Income left witch you can spend any way you choose
Economic growth
Increase in a country's output (GDP)
Bond
Interest- bearing certificate of agreement between a borrower and a lender
Mutual fund
Investment company that's sells stocks itself used the proceeds to buy other stock and bonds
a country may benifit from having a low currency value
It can help the country increase its exports
One disadvantage of a certificate of deposit is that
It has a high penalty for early withdrawal
What is the purpose of GDP
It's a measure of economic growth
What else would you have to know about a nation to tell weather GDP is an accurate measure in its wealth
It's standard of living, both for citizens and the nation as a whole
Standard of living
Material well-being of individuals or nations
Loan
Money lent at interest
What are the factors of production
Number of consumers, consumers preference, and consumer income
Demand refers to the amount of a good or service that
People are willing and able to buy at given price
What happens when the same amount of input, used in the same amount of time, produced a greater amount of output
Productivity goes up
Witch of the following is one of the steps to making a budget
Record everything that you earn and it's source
Under the bill of rights consumers have the right to
Safety redress choice
An opportunity cost is
The next best option after the one chosen
Total cost are the sums of
The variable cost plus the fixed cost
what does the world trade organization do
They protect against any bad trade, helps develop countries trying to develop
What are the three basic economic questions all societies must answer
To whom, to what, and how
Growth domestic product
Total value of all the final products sold in a year
If Marta wakes up early, she can have French toast for breakfast. If she sleeps and extra fifteen minutes, she will only have time for cold cereal. She decides to sleep in an extra fifteen minutes. Marta is making a
Trade-off decision
Privitization
Transferring government-owned businesses to citizens
A traditional economy is generally not very productive
True
A warranty protects a consumer because it promises to replace or repair faulty products
True
APR is not a consideration in determining a persons credit rating
True
countries who have free trade agreement with each other have no
tariffs on one another goods
what is one reason a team will not successfully appear on rankings
they have not successfully first trade
