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Econ Final Review
Econ Final Review
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1
Which one of the following may NOT be claimed as a tax deduction?
money spent on household expenses
donations to charity
interest on a home mortgage
some medical expenses
2
When the selling price of a goods goes up, what is the relationship to the quantity supplied?
the quantity supplied goes up
the cost of production goes down
there is no relationship between the two
the profit made on each item goes down
3
When the economy is working properly, what is the unemployment rate?
4-6 percent
8-10 percent
0-3 percent
10-12 percent
4
The lowest point in an economic contraction
/
Business cycle is called
a peak
a depression
a trough
a recession
5
if there is a fall in the interest rates,
The unemployment rate will most likely rise
Consumers will be less likely to buy more expensive items
Businesses will be more likely to expand their facilities
There will be a downturn in the economy
6
One example of thinking at the margin is
putting all of your money in a savings account because the interest rates
the benefit of working two extra hours per day compared to giving up study
Determing whether it is better to spend your savings on a new CD Player
deciding to buy a car you don't really like because it is less expensive
7
Which of these statements is a fundamental part of Keynesian economics?
The economy will only reach equilibrium & prosperity through regulating it
The federal government should have a balanced budget every year
the government should reduce taxes to promote economic growth by increasing
government can use deficit spending to pull the economy out of a recession
8
What is the required reserve ratio?
the amount of money a bank has to loan out
The ratio of commercial to personal loans that a bank makes
the portion of a deposit that a bank must keep on hand
the deposit that commercian companies make in banks
9
Right to work laws
Force companies to hire minorities and women
allows workers to work where they want
Ban Mandatory union membership
require that workers be paid atleast minimum wages
10
which of the following is an example of substitute goods?
steak and hamburgers
Stamps and envelope
toothbrush and toothpaste
peanut butter and jelly
11
Any Resources that are made by humans and used to create other goods and services are called?
Market
production
Capital
Services
12
A Demand Schedule or demand table is a list of:
the various prices for a good or service within a community
quantity of a good that buyers r willing&able to purchase @ various Prices
the amounts of a good or services a business has in stock.
the kind of goods or services that consumers want.
13
If a consumer goes to the store and buys a Blu Ray player, the shopper is buying both a
Nondurable and final good
Nondurable and intermediate good
Durable and final good
Durable and intermediate good
14
Which of the following jobs would be considered white color labor?
teacher
all of the above
fork lift operator
electrician
15
when a consumer is able and willing to buy a good or service, he or she creates which of the following?
Allocation
Elasticity
Demand
Consumption
16
Which of the following events could cause the demand curve for sports magazines to shift to the right?
A star B ball player interests thousands of people in professional sports
The price of an issue of a popular computer game magazine rises from $2.95
the local library cancels its subscription to the sports magazine
The publisher cuts the price of an issue from $3.95 to $2.50
17
An example of a nondurable good is
a used car
a new car
a paperback book
a washing machine
18
What is the opportunity cost of a decision?
the most desirable alternative given up for the decision
the best possible trade off of a decision
the series of choices that could have been made
the different ways firms can make choices
19
What are the three ways that unions negotiate a new labor contracts?
Collective bargaining, mediation, and arbitration
Collective bargaining, mediation and strikes
Press conferences, collective bargaining and arbitration
Settlements, towns hall meetings, and mediation
20
which is the following is an example of an inferior good?
seafood
new cars
Movies
used furniture
21
what gives the US government the right to collect taxes?
state law in all 52 states
the US constitution
an act of the US congress
custom of government
22
On which kinds of goods do governments generally place price ceilings?
Those that are not necessary, but have become customary
Those that are necessary and cheap
Those that are cheap but could become more expensive without the ceiling
Those that are necessary but too expensive for some consumers
23
Supporters of supply side economics believe that
Government should be used as a tool to favor industry
Taxes increases have a positive effect on economic output
Demand for goods increases when prices rise
tax cuts have little impact on worker productivity
24
What is the major source of tax revenue for local governments?
inheritance taxes
property taxes
income taxes
sales taxes
25
what type of economy produces goods and services based on the decisions of individual buyers and sellers?
socialist
Market
Communist
Command
26
Which of the following is the best example of the law of supply?
a food producer increases the number of acres of wheat he grows to try and
A Sandwich shop ^ the number of sandwiches they supply when the price goes^
A catering company buys new dishwasher to make their work easier
A milling company builds a new factory to process flour to export
27
What is a major difference between an operating budget and a capital budget?
an operating budget is small amounts of money and capital budget is bigger
operating budget legislation is needed and not needed in a capital budget
an operating budget is raised by bonds, a capital budget by taxes
an operating budget is 4 daily expenses, a capital budget is for investment
28
What is the difference between a recession and a depression?
A Recession is more severe than a depression and lasts longer
A recession is a period of economic growth while a depression is a contract
A depression is a deep recession with high levels of unemployment
a depression includes high levels of inflation
29
Which of the following is an example of scarcity?
you have spent your last penny and payday is a week away
gasoline was rationed in america during WWII
a popular toy is sold out during the busy holiday season
a person wants an endless supply of everything but cannot have it
30
In a typical business cycle, what stage immediately follows a peak?
growth
contraction
trough
expansion
31
In response to rising car traffic, demand for bicycle has increased. The new equilibrium point will show
Fewer bicycle sold, but at a higher price
Fewer bicycles sold, but at a lower price
More bicycle sold, but at a lower price
More bicycle sold, but at a higher price
32
Which of the following is an example of a final good and service?
Coffee beans a coffee shop purchases to make coffee
Wheat a bakery purchases to make bread
A cake purchased from a bakery for a wedding
Lumber purchased by a construction company to use in building houses
33
What does “ Monetary Policy" mean
decisions about how much the federal reserve charges members
actions the federal reserve takes to influence the economy
federal reserve policies on creating new banks
political polices pursued by the federal government
34
What is an example of a variable cost in a major league baseball franchise?
Manager's salary
stadium upkeep(lights/field)
ticket takers salaries
Stadium Rent
35
The purpose of a production possibilities graph is to
keep an economy from having non productive workers
enable a country to mobilize to win a war
show the profit margin firms can achieve
use given resources to make the most goods and services
36
when a larger and larger amount of resources will be needed to achieve the production of any given amount of output
opportunity cost of supply
Profit maximization
The Law of Diminishing Returns
opportunity costs of demand
37
What was the most effective weapon the unions could use to compel employers to change
The Strike
scabs
injuctions
all of the above
38
An example of expansionary fiscal policy would be
cutting taxes
cutting prices of consumer goods
cutting production
cutting government spending
39
When buyers will purchase exactly as much as sellers are willing to sell, what is the condition that has been reached
equilibrium
price floor
Supply and Demand
excess demand
40
what is the basic principle of the law of demand?
services are of interest in the same way that goods are
when a good's price is lower, people will buy more of it
everyone has a limited income that they will spend
the higher the price, the more people will want the good
41
A Supply Schedule or supply table is a list of:
quantities of a good that would be supplied by business at various prices
Quantities of a good or services that would be demanded by consumers.
the kinds of goods and services brought to market by a single supplier
the demand for inputs by firms to boost production
42
A _________ economy is based on customs and rituals, slowing progress and leading to lower standard of living/
traditional
Communist
command
capitalist
43
In what kind of an economy does the government make all the decisions?
Centrally Planned
Laissez Faire
Free Enterprise
Socialist
44
34. All of the following are causes of structural unemployment EXCEPT
inventing new ways of doing things
discovering new resources
failing of the stock market
relocating jobs to other countries
45
To generate the unemployment rate, the Bureau of Labor Statistics polls a sample population of
50,000 unemployed individuals
50,000 families
80,000 families
80,000 unemployed individuals
