If a country's currency is weakening, who is helped?

a company seeking to export good

To maximize profits, a bank would charge

the higher rate of interest on loans than those of deposits

If the Fed buys $10 million worth of gov. securities and the reserve requirement is 10%...

total monetary expansion could be as high as $100 million

Which of the following is included in GDP?

The purchase of a meal at Cheesecake Factory

What is the difference between a stock and a bond?

stock is ownership while a bond is simply a loan

Which of these is NOT true of a perfectly competitive market?

firms can collude to try and increase prices

Who is most negatively affected by unanticipated inflation?

A senior citizen living on a fixed income

What MOST often happens when demand for a product is highly elastic?

Substitution occurs when its price rises

If the Federal government (Congress) wanted to grow the economy, how might they do it?

decrease personal and corporate income taxes

Consumer sovereignty refers to

the importance of the consumer in deciding what is produced

If the Federal Reserve wants to stimulate economic growth, what would they do?

buy government bonds in the open market

What is the MAIN importance of banks in a market capitalist economy?

to connect savers and borrowers

In the circular flow, what is the role of businesses?

they supply products and purchase factors of production

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Economics EOC Review

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Final Exam (EOC) review

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Questions 30

Answers

1
In a market capitalist system, what is essential for prices to be "fair" to consumers?
profit motive
competition
monopolies
minimum wage
2
Which of the following is NOT a component of aggregate demand?
consumer spending
money in circulation
government spending
business investment
3
Generally, What would be the impact of an increase in technological capability in an economy?
Production possibilities curve would move inward
GDP would increase
inflation would increase
the budget deficit would increase
4
If a country's currency is weakening, who is helped?
A student traveling for a foreign country
A company attempting to import goods
a company seeking to export good
a worker who makes a fixed wage
5
Which of the following does NOT influence whether you can get a loan?
Age of the borrower
The amount of collateral of the borrower
The credit score of the person of the borrower
The borrowers history of repaying loans
6
To maximize profits, a bank would charge
a rate of interest that is the same for deposits and loans
the higher rate of interest on loans than those of deposits
a higher rate of interest for the rich than the poor
a lower rate of interest on loans than they pay on deposits
7
Which role does money have in economic systems?
a consumable good
a measure of satisfaction
a productive resource
a medium of exchange
8
If the Fed buys $10 million worth of gov. securities and the reserve requirement is 10%...
Excess reserves would increase by $1 million
Legal reserves would be $4 million dollars
there is no change in the money supply
total monetary expansion could be as high as $100 million
9
A Country's balance of trade involves the value of its
interest rate and exchange rate
exports and gross domestic product
foreign investment and government debt
exports and imports
10
What role is the government assuming when they use the FDIC to reassure bank customers?
producer of goods
consumer of goods
regulator
protector
11
Which of the following is included in GDP?
The purchase of a pair of shoes made in Italy
The purchase of cotton by Levi Strauss
The sale of a couch at a garage sale
The purchase of a meal at Cheesecake Factory
12
Which of the following is an example of capital as a productive resource of pizza
a chef who develops the recipe
the oven used to cook a pizza
the wood used to fuel the fire in the oven
the tomatoes used to make the sauce
13
What is the difference between a stock and a bond?
stocks are guaranteed to make money, bonds are not
stocks have less risk than bonds
stock is ownership while a bond is simply a loan
stocks can be bought by the public, bonds can't
14
Which of these is NOT true of a perfectly competitive market?
firms have no control over the price of the prodcut
firms can collude to try and increase prices
firms generally don't advertise their individual products.
firms sell nearly identical products
15
Which factor MOST directly effects the amount of money borrowers must repay to lenders?
the annual percentage rate
the inflation rate
the currency exchange rate
the unemployment rate
16
Who is most negatively affected by unanticipated inflation?
A student who has fixed interest rate student loans
A senior citizen living on a fixed income
A family who has a fixed rate mortgage on their home
A young college graduate who is working and saving money
17
What MOST often happens when demand for a product is highly elastic?
Substitution occurs when its price rises
Supply of the product increases as the price drops
The product will stop being produced when the prices drops
Demand for the product increases even when its price rises
18
Which of these would most likely increase GDP?
increasing corporate tax rates
increased government spending
increased imports
raising the interest rates
19
How does a Federal Reserve policy of low interest rates affect consumers?
They save less money
They tend to buy less expensive products
It increases reliance on foreign imports
It tends to lower prices for consumers
20
If the Federal government (Congress) wanted to grow the economy, how might they do it?
begin to pay off the debt
decrease government spending
decrease personal and corporate income taxes
increase the money supply
21
When the government spending increases, what will MOST LIKELY happen to employment?
It will increase
it will not change
it depends on what they spend it on
it will decrease
22
Which of the following would create a surplus in the market?
a price floor
a price ceiling
an increase in cost of inputs
an increase in the popularity of a product
23
An increase in government regulation will cause
a decrease in supply
an increase in the quantity demanded
the price of the product to decrease
the supply curve to shift to the right
24
Consumer sovereignty refers to
consumers being forced to buy things against their will
the power they have to take property away from corporations
the importance of the consumer in deciding what is produced
consumers determining the price of goods
25
If the Federal Reserve wants to stimulate economic growth, what would they do?
increase the interest rate
buy government bonds in the open market
decrease the money supply
increase the reserve requirement
26
SInce the United States applies higher rates of taxation on on higher incomes, it has a
a flat tax
a proportional tax
a regressive tax
a progressive tax
27
What is the MAIN importance of banks in a market capitalist economy?
to make a profit for their shareholders
to connect savers and borrowers
to limit spending by customers by holding their money
to decide how much money such be in the economy
28
An economy where producers and consumers makes decisions about what is produced is called
a traditional academy
a market economy
a democracy
a socialist economy
29
if the supply of teaching candidates increased, what would MOST likely happen to teacher wages?
they would not be affected
depends on how much the supply changed
they would increase
they would decrease
30
In the circular flow, what is the role of businesses?
they buy products and sell factors of production
they supply products and supply the factors of production
they buy products and buy factors of production
they supply products and purchase factors of production

Economics EOC Review Flashcards | StudBud