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Econ Final Final Review Flashcards | StudBud
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Econ Final Final Review
Econ Final Final Review
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Flashcards
45 cards
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Questions
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Answers
1
Which of these actions would most likely result in a decrease in consumer spending?
B Decreasing the interest rate
D Decreasing the reserve requirement
A Increasing income taxes
C Increasing government spending
2
What is the most basic economic issue for all societies?
Recession
Taxation
Inflation
Scarcity
3
Which of the following is a result of the specialization of labor?
A Increased inflation
B Identical income
D Less interdependence
C Increased output
4
Which of the following is an economic goal of United States government policy?
D To promote full employment
A To own the factors of production
B To limit international competition
C To create a classless society
5
Keynesian economic policies are designed to lower unemployment by _______
stimulating aggregate demand
creating government jobs
reducing aggregate demand
stimulating aggregate supply
6
Which of the following situations would result in a government budget deficit?
A The Federal Reserve borrows more than it lends.
B The government spends more than it collects in taxes.
D The government spends the same as it collects in taxes.
C The Federal Reserve lends more than it borrows.
7
In economic terms, what are land, labor, capital and entrepreneurship
A Production possibility
B Factors of production
C Production trade-offs
D Opportunity costs
8
Which best reflects how the government attempts to manage the economy through fiscal policy?
A. Controlling interest rates
D Buying and selling securities
B Controlling the money supply
C Taxing and spending
9
Which of the following factors contributes the most to economic growth?
A Large amounts of natural resources
D High rates of inflation
C Low investment in human capital
B Greater economic freedom
10
when consumers and producers act in their own self-interest, what will be the overall result?
businesses will lose money no matter what they sell.
less variety and fewer products will be made.
excessively high prices for goods and services.
C The producers earn a profit making products people want.
11
Supply-side policies aim to _______
strengthen the economy by increasing taxes
reduce the government’s role
increase regulation of corporations
strengthen the government’s role
12
Which of the following is true of an investment in bonds?
C They are a low-risk investment.
insured by the Federal Deposit Insurance Corporation.
entitle the holder to a share of ownership in a corporation.
B They are held for three to six weeks, then sold.
13
happens when a country’s money supply increases faster than the goods and services it produces?
D Stability
B Unemployment
C Equilibrium
A Inflation
14
competitive market that has only a few firms controlling the production of a product?
C Pure competition
B Oligopoly
D Monopoly
A Fierce competition
15
What is the benefit of competition in a free market system?
B Create a variety of new and cheaper products
A Make sure everyone gets an equal share of resources
C Cause producers to try to put each other out of business
D Follow the traditional methods of production
16
In economic terms, what is a “stock”?
C Ownership of an entire company
D A place where individuals raise money
A A share, or part ownership, of a company
B Pieces of paper that represent money
17
What is likely to happen when consumers want to buy more scooters than the store has
A Profit on scooter sales will be smaller.
D Stores will make a different model.
C Manufacturers will stop making it.
B Price of the scooter will increase.
18
describes a market in which one firm controls the supply and pricing of a good or service?
A Monopolist competition
C Perfectly competitive
B Oligopoly
D Monopoly
19
What would most likely happen to the orange market if a hurricane destroyed half of crop?
A Demand for oranges will rise
B The price of oranges will fall
C The price of oranges will increase
D Supply of oranges will increase
20
How does the process of specialization change an economy?
C Improves efficiency of production
A Eliminates unemployment
B Decreases competition
D Increases government to control
21
In every economic system, what must people choose to do?
D Save money to reduce the national debt
C Create an equal distribution of income
B Make the best use of scarce resources
A Satisfy all the wants of their society
22
Which factor will decrease the demand for a product?
C A decrease in the price of a complementary good
B A decrease in the number of buyers
D An increase in the price of a substitute good
A Increased popularity of a product
23
Which decision will guarantee that a person will make money in the stock market?
C Buying the stock of a small company like Starbucks Coffee
A Buying the stock of a big company like Microsoft
B Nothing will guarantee making money in the market
D Purchasing stocks after the market has dropped for a week
24
What is the primary incentive that motivates a manufacturer to sell a product?
B Putting others out of business
C Pleasing the government
D Reputation of the product
A Making profits on sales
25
bonds are considered a safe investment, which characteristic would you expect them to have?
B They have high interest rates.
D They have lower rates of return.
C They take a long time to mature.
A They take a short time to mature.
26
In a market economy, what is the government’s role?
C Encourage competition among businesses
D Sets prices on goods and services
A Decides what goods are manufactured
B Owns and operates major industries
27
Which of the following describes a publicly held corporation?
D Family members are excluded from holding stock
B Large numbers of stockholders can buy/sell stock
C Stocks are not usually traded at stock exchanges
A Stocks are not available to company owners.
28
What is the result of a price ceiling which is a price set below the equilibrium price?
B Surplus
C Equilibrium
D Equidistant
A Shortage
29
In the model GDP = C + I + G + (X - M), “G” stands for _______
Give A Ways
Government Spending
Grants
Government Revenue
30
A company decides to install more machines and lay off workers. What is answered?
C For whom to produce
How to produce
What to produce
D Where to produce
31
Which choice is the income tax system the U.S. Federal Gov't uses?
C A regressive income tax
B A flat tax on income
A A progressive income tax
D A value added tax on income
32
Which of the following government actions is likely to stimulate the economy?
A Increase income taxes and increase government spending
D Increase government spending and decrease income taxes
B Decrease income taxes and decrease government spending
C Decrease government spending and increase incomes taxes
33
In which of the following economic systems is the “factors of production” privately owned?
C Communism
D Confucianism
B Socialism
A Capitalism
34
What is the main idea behind the study of economics?
C Allocation of scarce resources
A. Monetary policy
B Efficiency of production
D Business decisions
35
Which of the following statements will help to maximize your stock investment?
D Buy high, sell high
B Buy high, sell low
C Buy low, sell high
A Buy low, sell low
36
How many businesses make up an oligopoly?
Most
None
Few
One
37
Spending that Congress is required to make by law is called:
mandatory spending
deficit spending
discretionary spending
capital spending
38
Point at which quantity demanded equals quantity supplied on Supply and Demand Graph
C Shortage
A Surplus
B Equilibrium
D Equidistant
39
You buy either a CD or to go to a movie. What is the choice that you “give up” called?
A Positive cost
D. Marginal cost
C Opportunity cost
B Negative cost
40
Which of the following is the best example of the law of supply?
company builds a new factory to process flour to export.
supplier provides more to local stores as prices fall.
company buys a new dishwasher to make employee work easier.
shop increases the supply when the price increases.
41
In general, what type of economy does the United States have?
B Market
D Traditional
C Command
A Transitional
42
“There is no free lunch.” In economic terms, what does this mean?
A Someone must pay for everything.
C Choices are never based on self-interest.
B All production is designed to reduce scarcity.
D People only think of others when making choices.
43
In a market economy, what determines the price and quantity of most goods produced?
D Quality of goods
C Economic policies
A Substitute goods
B Supply and demand
44
Unlimited Wants + Limited Resources = ?
A Scarcity
D Equilibrium
B Competition
C Savings
45
If a government sets a maximum price for a good or service, what does it create?
B Price floor
D Illegal price
C Inflated price
A Price ceiling
