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Economics Unit 3 Exam Flashcards | StudBud
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Economics Unit 3 Exam
Economics Unit 3 Exam
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1
If businesses can decrease the amount of labor needed to increase inventories, the result will most likely be —
economic growth
increased inflation
increased taxes
decreased productivity
2
the gov. said that it would stop the production of a particular military aircraft. How will this affect the area?
Unemployment will increase resulting in the creation of new types of jobs
There will be a shift of gov spending to the production of alternatives
a reduction in the income of households resulting in reduced purchasing pwr
an increase in the market because aircraft makers will be more efficient
3
Which of the following is a non-price determinant of demand?
Productivity
Price ceiling
Consumer preferences
Subsidy
4
Which non-price determinate is sometimes used by the govt to decrease demand for a product that is viewed as harmful
Subsidies
Rationing
Consumer boycotts
Excise taxes
5
One of the benefits of the U.S. free enterprise system is the —
guaranteed returns on investments
amount of choices for consumers
equal distribution of goods and services
lack of union participation by workers
6
Which of the following conditions could explain the shift in the demand curve shown on the graph?
Surveys found that people are eating more cooked tomatoes.
Eating cooked tomatoes was found to have more health benefits.
Farmers harvested a bumper crop of tomatoes.
Shoppers learned that cans of cooked tomatoes are spoiled.
7
One government restriction to consider when proposing to build a new business includes —
investor taxes
repayment of loans
zoning laws
hiring subcontractors
8
The market structure of pure competition is distinctive because —
there are no examples of this type of market structure
only one seller is needed in this market structure
the sellers in this market structure have no control over price
there are large numbers of barriers to entry into this market structure
9
Supporters of protectionism would argue that free trade adversely affects which group of people?
Consumers
Shareholders
Multi-national corporations
Workers
10
Which of the following accounts for why countries specialize in particular trade products?
Variation in the size of markets
Unequal distribution of resources
Variety in the types of economic systems
Government regulations
11
Economic growth would most likely result from —
increased employment
decreased trade
decreased sales of stock
increased productivity
12
Which one of the following is both a federal revenue source and an expenditure?
Social Security
Income taxes
Defense spending
Net interest
13
In the U.S. free enterprise system one of the primary roles of the government is to —
employ a majority of the workforce
provide new sources of funding for technology start ups
ensure the safety of products through regulation
guarantee that investors profits are secure
14
Jenny needs a computer and a new television for college. She only has enough for the computer. Which is the opp cost
Moving expenses
College tuition money
A new television
A new computer
15
Based on the information on the table above, which economic condition is characteristic of all three nations?
High levels of inflation
Low GDP per capita
High levels of unemployment
Low inflationary levels
16
The introduction of new manufacturing technologies generally affects economic growth by —
stopping production while workers learn the new technology
creating safer work environments
increasing the productivity of labor
restricting growth because of the additional expense
17
In a free market society, the answer to the question about how much to produce is determined by —
profit projections
government quotes
census data
consumer demand
18
One cost consideration made when purchasing personal property, such as a car would be —
time spent viewing the property
maintenance of the property
potential co-owners of the property
asset value of the property
19
Based on the information in the graph and the table, what is the equilibrium price of pizza?
$2.00
$3.00
$4.00
$5.00
20
What economic policy distinguishes Sweden’s free market economy from that of the United States?
Sweden limits government spending
Privatization of the social welfare system
Government funding of education and health care
High levels of administrative inefficiency
21
Advocates of free trade argue that it results in —
increased immigration
lower corporate tax rates
higher unemployment
increased economic growth
22
With a given amount of resources, a country with a comparative advantage will produce a product with —
higher quality specifications
lower opportunity costs
cheaper natural resources
decreased demand
23
Scarcity is a basic economic problem because —
governments limit production
resources are limited
opportunity costs limit demand
people have trouble making choices
24
An expansionary period in the business cycle is distinguished by —
high inflation
fewer excise taxes
low unemployment
declining sales
25
In comparison to the U.S. free enterprise system the economy of China is characterized by a lack of —
trade incentives
well-paying jobs
competition
manufacturing industries
26
High levels of unemployment combined with high levels of inflation could indicate that the business cycle has entered in
investment
recession
expansion
stagflation
27
One of the benefits of renting a home is that the cost of maintenance is —
cheaper in a rental property
the responsibility of the landlord
covered by renters insurance
refunded with the deposit
28
On a supply and demand graph, supply will decrease and shift to the left when which of the following happens?
The total cost of inputs decreases.
The number of firms leaving the industry increases.
Production taxes decline over a short period of time.
There are fewer government regulations in place.
29
One of the advantages corporations have that sole proprietorships do not is —
limited liability
lack of special taxes
rights to all profits
ease of start up
30
Which of the following best completes the diagram?
Characteristics of Sole Proprietorships
Characteristics of Partnerships
Characteristics of Free Enterprise
Characteristics of Corporations
