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Economics Final Exam Review Flashcards | StudBud
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Economics Final Exam Review
Economics Final Exam Review
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1
A rational choice involves choosing
goods that are highly advertised
least expensive goods, regardless of quality
goods that you believe can best satisfy your wants
most expensive goods
2
Which of the following are durable goods
concert tickets
refrigerators
groceries
cosmetics
3
What do Treasury bills, Treasury notes, and Treasury bonds have in common?
all are exempt from federal income tax
all pay the same interest rate
all are issued by the federal government
all mature in the same amount of time
4
The amount of good and services people can actually buy with their money is their
purchasing power
voluntary exchange
utility
substitution effect
5
The basic problem of economics is
overabundance of resources
lack of choice
scarcity
shortages
6
To an economist, a want is
something you must have to survive
something most people have
something you do not have
something other than a basic survival need
7
Who owns the factors of production and makes economic decisions in a market economy?
economists
communities
government
individuals
8
Methods of production have changed as a result of
technology
decrease in workers
lack of financing
increase in raw materials
9
The relationship between price and quantity supplied is
a direct one
an inverse one
an indirect one
nonexistent
10
According to the law of supply, as the price rises for a good,
quantity supplied decreases
manufacturers stop producing it
quantity supplied increases
consumers stop buying it
11
In a trade-off, opportunity cost is the value of the
next best alternative
scarce resources
action that was chosen
factors of production
12
The goal of economic freedom is to
limit competition
allow each member of society to make choices
prevent businesses from failing
allow the government to control the economy
13
A law dealing with unemployment compensation helps provide
economic growth
economic stability
economic security
economic equity
14
A method of payment that enables customers to transfer funds electronically from their bank is
debit card
regular charge account
credit card
revolving charge account
15
An ad that appeals to emotions, but does provide facts is an example of
informative advertising
bait and switch
comparison shopping
competitive advertising
16
To determine which creditor is charging the most for credit, a consumer should compare
length of the credit agreements
finance charges
monthly payments
annual percentage rates
17
The use of technology to produce and distribute goods will
increase supply
decrease supply
not affect supply
move the supply curve to the left
18
The need to make choices arises because
shortages are a constant situation
some things are not limited
people need to share their resources
everything that exists is limited
19
Which type of financial institution is owned and operated by its members
savings and loan
consumer finance company
commercial bank
credit union
20
Anytime you receive credit, you are
going into debt
earning interest on borrowed money
increasing the value of an item
lowering the cost of an item
21
Prices on good and services are determined
only by supply
only by demand
neither by demand nor supply
both by demand and supply
22
What trade-off is involved when you buy a CD?
exchanging money for goods
exchanging time for money
exchanging good for services
exchanging one service for another
23
Which of the following is the most efficient method of gathering information?
going to different stores
browsing the web
listening to ads on the radio
making telephone calls
24
In a free enterprise system, who makes the decisions about what should be produced?
consumers
entrepreneurs
government
sellers
25
When a product becomes a fad, the demand curve for that product
slopes upward
shifts to the right
shifts to the left
becomes a straight line
26
As an economic term, land includes
machinery
natural resources
work people do
knowledge
27
Your credit rating affects your ability to
get a job
get an education
save money
obtain a loan
28
Economic models are useful because they
judge the value of economic events
show the way people react to changes in the economy
make testing a hypotheses unnecessary
provide every detail about a problem to be studied
29
Since the 1880s, the role of government in the United States has
been eliminated
had no impact on the economy
decreased
increased significantly
30
One way to extend the life of a product is to
replace it with a similar product
find new uses for it
produce more of it
raise the price
31
Which of the following could be uses as collateral?
job
credit card
current debts
car
32
A shift to the left in the demand curve indicates
increase in population
increase in demand
decrease in demand
decrease in price
33
All economic choices involve
trade-offs
tax dollars
shortages
destruction of resources
34
Economic equity deals with the issue of
specialization
choices
profit
fairness
35
Which statement reflects the inverse relationship between quantity demanded and price
as the price goes up, quantity demanded goes up
as the supply goes up, the demand goes up
as the supply goes up, the price goes up
as the price goes down, quantity demanded goes up
36
American consumers spend most of their money on
transportation
recreation
health and personal care
housing and food
37
All economic systems
have the same resources
distribute products through majority rule
produce the same goods
must answer the same basic three questions
38
What motivates people to establish new businesses or expand existing ones?
profit incentive
freedom of choice
government regulations
private property
39
A government set maximum price that can be charged for goods and services is
a price floor
a price ceiling
an equilibrium price
rationing
40
Competition forces businesses to
raise prices
lower the quality of their products
raise the costs of production
keep prices low
41
Almost all economic systems today are
market economies
traditional economies
mixed economies
command economies
42
All the steps in consumer decision making involve
opportunity cost
discretionary income
disposable income
luxury items
43
Which of the following types of financial institutions controls the most money
savings and loan
commercial bank
finance company
savings bank
44
Which of the following is a visual aid that helps a business determine how to use its resources
scarcity
production possibilities curve
opportunity cost
trade-off
45
The largest installment debt in the United States is money people owe
on home mortgages
on cars
on clothes
on appliances
46
The first decision a consumer must make is
whether the product has a warranty
how to use the product
what quality the product should be
whether or not to buy an item
47
The opportunity cost of comparison shopping is
price you pay for the item you choose
money you save by making a rational choice
money advertisers spend to attract your attention
time you could have spent doing something else
48
Which of the following describes what economist do?
offer solutions to economic problems
predict which policies will be good or bad
consider every detail of a problem
rely on public opinion
49
The benefit of using credit is
not going into debt to buy things you want
being able to buy and enjoy a good or service now than later
paying lower prices for expensive durable goods
paying interest on borrowed funds
50
In economic terms, the marketplace
is a place where people buy food
exists only at the local level throughout
operates through voluntary exchange
exists only at the national level
51
Which of the following groups of people have a traditional economy?
North Koreans
Australian Aborigines
Chinese factory workers
medieval peasants
52
The maximum amount of goods and services a person can buy on the promise to pay in the future
annual percentage rate
credit card
finance charge
credit limit
53
The four factors of production are the resources of land, labor, capital, and
services
productivity
entrepreneurship
technology
54
The use of a slogan, a jingle, or a celebrity endorsement are examples of
price leadership
product identification
direct-mail advertising
product pricing
55
Which of the following factors might affect a person's capacity to pay back a loan
educational background
problems with the law
other large debts
involvement in community organizations
