stud
bud
Sign up
Log in
Home
Library
Explore
SAT
More
Economics Unit 5 Exam Flashcards | StudBud
Explore
/
Economics Unit 5 Exam
Economics Unit 5 Exam
30 terms
·
StudBud Administration
·
5,700 plays
Imported from external platform
Flashcards
30 cards
F
Practice quiz
P
Host live
L
Questions
30
Answers
1
Which investment is considered the most secure in a retirement plan?
401(k)
Public bond
Individual retirement account
Mutual fund
2
An expansionary period in the business cycle is distinguished by —
high inflation
fewer excise taxes
declining sales
low unemployment
3
Scarcity is a basic economic problem because —
governments limit production
resources are limited
opportunity costs limit demand
people have trouble making choices
4
In the U.S. free enterprise system one of the primary roles of the government is to —
employ a majority of the workforce
ensure the safety of products through regulation
provide new sources of funding for technology start ups
guarantee that investors profits are secure
5
Which characteristic of the U.S. free enterprise system creates the incentive to work, save, and invest?
Consumer sovereignty
Voluntary exchanges
Social Security system
Private property ownership
6
Which of the following is a non-price determinant of demand?
Price ceiling
Consumer preferences
Subsidy
Productivity
7
One of the financial advantages of donating to charitable causes is that the donation can be —
viewed as a capital gain
considered a tax deduction
taken directly from a pay check
used to fund investments
8
Which of the following retirement investment options is usually offered as a benefit of employment?
College tuition reimbursement
Mutual Funds
Bonds
401(k)
9
One result of competition in a free enterprise system is —
steady wages and incomes
improved safety conditions
lower prices for products
fewer consumer choices
10
One of the primary functions of financial institutions in an economy is to —
offer incentives to businesses for investing
provide access to capital for people and businesses
prepare taxes for individuals and businesses
create investment portfolios for venture capitalists
11
The market structure of pure competition is distinctive because —
only one seller is needed in this market structure
there are no examples of this type of market structure
there are large numbers of barriers to entry into this market structure
the sellers in this market structure have no control over price
12
One government restriction to consider when proposing to build a new business includes —
zoning laws
hiring subcontractors
investor taxes
repayment of loans
13
One of the benefits of the U.S. free enterprise system is the —
amount of choices for consumers
guaranteed returns on investments
lack of union participation by workers
equal distribution of goods and services
14
One effect of an increase in the amount of savings in an economy is —
a decrease in retirement investments
a decrease in the production of goods and services
an increase in financial resources for business investment
an increase in consumer spending
15
One of the benefits of home ownership includes —
building equity
purchasing insurance
funding large capital outlays
paying property taxes
16
Which of the following is considered a benefit to purchasing insurance?
Insurance can cover the difference between monthly expenses and income.
Insurance is available when an unexpected need for repair or services arise
Insurance can be used to cover the cost of moving expenses.
Insurance coverage can reimburse for losses on investments.
17
Economic growth would most likely result from —
increased productivity
decreased sales of stock
increased employment
decreased trade
18
Investments with high rates of return are generally accompanied with —
very little risk
high levels of risk
lower levels of risk
no risk
19
Which of the following best completes the diagram?
Characteristics of Corporations
Characteristics of Sole Proprietorships
Characteristics of Free Enterprise
Characteristics of Partnerships
20
The most effective way to manage credit card debt is by —
paying off the balance each month
finding a credit card with the lowest interest rate
working a part-time job to pay for credit
paying the minimum balance
21
Which of the following is most characteristic of the U.S. free enterprise system?
Public ownership of the factors of production
Government price controls
Nationalization of energy companies
Markets that respond to consumer demand
22
An important financial detail to consider when purchasing a home includes —
number of rooms
family size
saving for a down payment
time for commuting
23
On a supply and demand graph, supply will decrease and shift to the left when which of the following happens?
The number of firms leaving the industry increases.
There are fewer government regulations in place.
Production taxes decline over a short period of time.
The total cost of inputs decreases.
24
Loans that are obtained by offering an asset to guarantee repayment of the loan are considered —
unsecured loans
default loans
secured loans
repossession loans
25
Which of the following is a basic characteristic of all economic systems?
Wage incentives
Distribution of goods and services
Small business owners
Price controls
26
Which of the following is an action of the Federal Reserve that strongly influences local economies?
It can make loans cheaper or more expensive by adjusting interest rates.
It can raise or lower property taxes.
It can require banks to provide savings accounts to the community.
It can provide stimulus money for job creation.
27
Which of the following actions would improve a credit score?
Checking credit reports on a regular basis
Consolidating credit card balances
Paying off all debts
Keeping credit card balances as high as possible
28
What is one advantage to placing savings in a high-risk investment as oppose to putting savings in a low-risk investment
The amount of money needed to invest is lower.
The money is more secure in a high-risk investment.
The tax rate on high-risk investments is lower.
The potential rate of return on investment is higher.
29
One way the United States could increase exports of sports cars would be to —
increase the exchange rate of the American dollar
negotiate to lower tariffs on sports cars
reduce gasoline taxes in the United States
raise the prices of sports cars in the United States
30
One potential risk from investing in the stock market is the loss of —
investor tolerance
earned interest income
portfolio diversification
purchasing power
