If a student spends 2 hours studying for an exam instead of working a part-time job, the opportunity cost is...

The money the student could have earned during that time.

What is the difference between monetary and fiscal policy? (Choose Two)

Fiscal policy = gov. tax and spend, monetary policy = interest rates, Monetary = Federal Reserve, Fiscal = federal government

Which of the following best describes the recession phase of the business cycle?

Economic activity is contracting, and unemployment is rising.

Which of the following is an example of protectionism in international trade?

Increasing tariffs on imported goods to protect domestic industries

The Law of Diminishing Marginal Returns states...

that adding more input leads to smaller output gains

The Federal Reserve might advocate lowering the reserve requirement in order to...

Increase the money supply during economic recession

Which of the following is NOT a characteristic of a command economy?

The means of production are mostly owned by private individuals.

In the short run, what happens to the equilibrium price and quantity, when demand increases?

Equilibrium price increases, and quantity increases.

What does the concept of scarcity mean in economics?

Resources are limited, and choices must be made about how to allocate them.

Which of the following is the first step in creating a personal budget?

Track and categorize current spending

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Econ. OAE Review 2025

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Questions 15

Answers

1
If a student spends 2 hours studying for an exam instead of working a part-time job, the opportunity cost is...
The money the student could have earned during that time.
The value of future job opportunities.
The time spent studying for the exam.
The student's exam grade.
2
During which stage of the business cycle is economic activity at it's highest point?
Contraction
Peak
Trough
Expansion
3
What is the difference between monetary and fiscal policy? (Choose Two)
The federal government controls the interest rate, not the Federal Reserve
Monetary = federal government, Fiscal = Federal Reserve
Fiscal policy = gov. tax and spend, monetary policy = interest rates
Monetary = Federal Reserve, Fiscal = federal government
4
Which of the following best describes the recession phase of the business cycle?
The economy is in a period of rapid growth.
Unemployment is low, and wages are rising.
Economic activity is contracting, and unemployment is rising.
Economic activity is at its peak, and businesses are expanding.
5
Which of the following goods is most likely to have inelastic demand?
Designer clothing
Gasoline
Vacation travel
Luxury cars
6
Which of the following is an example of protectionism in international trade?
Increasing tariffs on imported goods to protect domestic industries
Allowing free trade without government interference
Joining international trade agreements to reduce trade barriers
Lowering tariffs to encourage trade between countries
7
The Law of Diminishing Marginal Returns states...
that adding more input leads to larger output gains
that adding less input leads to larger output gains
that adding less input leads to smaller output gains
that adding more input leads to smaller output gains
8
The Federal Reserve might advocate lowering the reserve requirement in order to...
Increase the money supply during economic recession
Increase interest rates during a time of economic recession
Decrease the money supply during economic expansion
Decrease interest rates during a time of economic expansion
9
How many member banks are in the Federal Reserve?
12
13
50
7
10
Which of the following is NOT a characteristic of a command economy?
Resources are allocated based on central planning.
The means of production are mostly owned by private individuals.
Prices and production are controlled by the government.
The government makes most economic decisions.
11
In the short run, what happens to the equilibrium price and quantity, when demand increases?
Equilibrium price increases, and quantity increases.
Equilibrium price decreases, and quantity increases.
Both equilibrium price and quantity decrease.
Equilibrium price increases, and quantity decreases.
12
Which of the following is a fake international financial institution?
International Monetary Fund
World Bank
New Development Bank
United Nations Fiscal Council
13
Which of the following laws helps ensure that consumers receive accurate information about credit terms?
The Equal Credit Opportunity Act
The Truth in Lending Act
The Consumer Credit Protection Act
The Fair Credit Reporting Act
14
What does the concept of scarcity mean in economics?
Resources are limited, and choices must be made about how to allocate them.
Resources are abundant, and there is no need to make choices.
Unlimited resources are available to meet everyone's needs.
All resources are distributed equally among all people.
15
Which of the following is the first step in creating a personal budget?
Track and categorize current spending
Apply for a credit card
Set long-term financial goals
Cut unnecessary expenses

Econ. OAE Review 2025 Flashcards | StudBud