ECONOMICS-UNIT 1 QUIZ 3 & practice test

In a traditional economic system, which scenario would one most likely see?

A farmer grows a one-acre farm to produce all the vegetables his family will need over the course of a growing season.

a person who places money in a bank

depositor

a recession that is very long and severe

depression

An economy going from the trough to the peak is said to be in a state of ___.

expansion

_______ is the statistic that shows the total value of all goods produced within a country regardless of national affiliation.

gdp

___________ is the total value of all goods produced within a particular country regardless of what country the business is from.

gnp

A country's economy and GDP must be in decline for this long in order for its economic condition to be considered a recession.

six months

The market (consumer) decides what is made, sold, and bought.

market economy

In order for a country's economic condition to be considered a recession, the economy and GDP must be in decline for ___.

six months

In 1837, President Andrew Jackson caused a depression for Martin Van Buren during his fight with ___.

the Bank of the United States

Which war and the subsequent agricultural surplus helped cause the 1857 depression?

the Crimean War

Which movement influenced the concepts of the market economic system?

the Enlightenment

Fluctuations through a series of economic expansions and contractions is part of ___.

the business cycle

During the 1873 depression, the people in debt were in favor of ___.

the reissue of greenback dollars from the Civil War

Those suffering from the 1873 depression pushed for ___.

the reissue of greenback dollars from the Civil War

All of the following are economic powers of the U.S. government under the U.S. Constitution EXCEPT ___.

the senate passes all bills dealing with revenue

In the area of economics, the government divides its earning marks into quarters, or every ___ months.

three

Economically, the government divides its earning marks into quarters, or every ___.

three months

In 1837, President Andrew Jackson contributed to a depression that followed after Martin Van Buren took office because of his fight ___.

to close the Bank of the United States

The biggest responsibility that consumers have is ___.

to educate themselves on the products they are interested in, including their benefits and potential costs or problems

The ________ is reached when a country's economy (GDP) is at its highest output; after that, the economy enters a recession.

peak

the point at which a country's GDP and economy reach top efficiency and are immediately followed by a downturn

peak

The National Bureau of Economic Research is an independent, ______ organization not found within the government that observes and tracks the actions of the business cycle.

private

A period when a country's economy (GDP) is at its lowest output is a _______________.

trough

To which factor does the arrow on the business cycle chart point?

trough

Which scenario does NOT express a decision made with an economic perspective?

A young man makes an impulse buy and purchases two CDs he heard about from a friend.

The Articles of _____ was the first constitution of the United States that gave more power to the states and left the federal government weak.

Confederation

One of the first three departments of the early American government was the ___.

Department of State

Which was one of the first three departments of the early American government?

Department of State

_______ is a period when the economy and GDP begin to improve and grow. It is characterized by lower unemployment, an increase in consumption and investment, and banks willing to loan money.

Expansion

Which government agency ensures that businesses operate legally so that the consumer will not be misled or harmed?

Federal Trade Commission

The depression of 1893 was directly responsible for the growing popularity of the ___ Party.

Populist

The collapse of ___ greatly altered U.S. military spending.

Russia

What was Thomas Jefferson's argument against the creation of a national bank?

The government did not have the constitutional authority to do so.

Why might the states be upset at the federal government paying off their debts?

The states did not want to be answerable to the federal government and therefore be put in a weaker position.

decision made based on maximum benefit and value

rational choice

A slowdown in the economy characterized by rising unemployment, a lack of consumption and investment, and banks being slow to lend money is called _______.

recession

Which scenario would NOT affect the GNP of the United States?

a German-based grocery store in Champaign, Illinois

Which of these would NOT add to the GNP of the United States?

a German-based grocery store in Champan, Illinois

Where can you find the agency responsible for putting together business cycle information—in particular, when the cycle peaks and plummets?

a private company not found within the government

A country's economic peak is followed by ___.

a recession

The lowest period for a country's GDP is called ___.

a trough

One of the major causes of the economic downturn of 1819 was ___.

a wave of overspeculation in the Western frontier territories

Which scenario would NOT affect the GDP of the United States?

an American-based investment firm in Australia

Which of these would NOT add to the GDP of the United States?

an American-based investment firm in Switzerland

One major cause of the 2008 financial crisis was that ___.

banks made risky loans and inflated housing prices

trading one item to receive another item

barter system

Fluctuations between economic contractions and expansions are known as the ______________.

business cycle

___ held a large portion of U.S. debt in 2010.

china

problem that occurs due to limited resources and unlimited wants

scarcity

all economic decisions are made by the government with little or no input by the people.

command economy

knowing as much as you can before buying

consumer responsibility

Hamilton's economic plan included all of the following parts EXCEPT ___.

creation of a national bank

What was NOT a part of Hamilton's economic plan?

creation of a new set of bank notes

consumer's record of debt payment and fulfillment of financial obligations

credit

money owed by an individual, company, or government

debt

wrote Wealth of Nations on the advantages of a market economy (capitalism)

adam smith

The future of the U.S. Social Security system is in jeopardy because of a large number of ___ and a declining birth rate.

aging baby boomers

Which of the answers took up the largest percentage of U.S. spending in the 2016 budget?

healthcare

In 2010, ___ was increased greatly.

healthcare spending

A loss of value of money that causes a rise in prices is ______.

inflation

a rise in prices due to the loss of value of money

inflation

the charge a lender places on borrowed money

interest

the term used for the overvaluing of property or land

overspeculation