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Roe Economics Flashcards | StudBud
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Roe Economics
Roe Economics
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Questions
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Answers
1
According to the law of supply, when prices increase what happens?
Demand decreases
Quantity demanded decreases
Supply increases
Quantity supplied increases
2
Stock prices are determined by what?
Investors
Securities and Exchange Commission
Market forces of supply and demand
Workers at the stock Exchange
3
A microeconomist would most likely study what?
World trade
The law of supply and demand
The business cycle
A rise in tea prices
4
As sales of Peanut Butter increase, so do the sales of Jelly. What factor affects demand?
Price
Complements
Consumer expectations
Substitutes
5
The government can alter economic outcomes by means of taxes and spending; which is:
Foreign-Trade policy
Fiscal policy
Monetary policy
Easy money policy
6
A society that has public schools and ownership of private property has elements of both:
Market and Traditional
Mixed and Command
Mixed and Market
Traditional and Command
7
Which of the following happens during a contraction?
Resources become less scarce, and prices rise
Resources become more scarce, and prices rise
Resources become less scarce, and prices fall
Resources become more scarce, and prices fall
8
On what principle is the idea of a progressive tax based on?
Ability to pay
Efficiency
None of the above
Simplicity
9
What are the four factors of production?
Land, labor, capital, and entrepreneurship
Land, resources, capital, and entrepreneurship
Land, labor, money, and entrepreneurship
Land, labor, resources, and entrepreneurship
10
The only grocery store within a radius of 150 miles has a what?
Control over the market
Monopoly
Pure competition
Geographic monopoly
11
What payroll tax is taken out to cover Medicare and Social Security
NAFTA
FERPA
FMLA
FICA
12
The act of buyers and sellers freely and willingly engaging in market transactions is:
An example of global interdependence
An example of voluntary exchange
An example of Global exchange
An example of pooling of resources
13
In economic terms laissez faire means what?
The government stays out of the market
The government controls the market
The government moves in and out of the market
The government has limited control
14
Which statement is true of discretionary spending?
The government can choose whether or not to fund it
The government is forced by law to fund it
None of the above
The government uses tax dollars to fund it
15
An economy that has few regulations that adjust free enterprise is an example of what?
Modified free enterprise
Free enterprise
Economic enterprise
Voluntary enterprise
16
Diversification means that an investor does what?
Buys corporate bonds
Makes different types of investments to minimize risk
Invests in stocks from a variety of corporations
Purchases stocks on several stock exchanges
17
Why is coordinating monetary and fiscal policy a good idea?
To avoid economic instability
To influence inflation and growth
To help pay the National Deficit
To create more jobs
18
On a market supply and demand graph, the vertical axis (Y) indicates what?
Price
Supply
Quantity
Demand
19
Based on the law of Demand, what happens to the demand of a product when prices decrease?
Nothing - demand stays the same, quantity supplied increases
Nothing - demand stays the same, quantity demanded increases
Nothing - demand stays the same, quantity demanded decreases
Nothing - demand stays the same, quantity supplied decreases
20
An economy where government officials decide the distribution of resources is an example of:
Mixed Market
Free Market
Command
Traditional
21
The market value of all goods and services within a nation in a given time period:
Gross Domestic Product
Gross International Product
Gross Income Product
Gross National Product
22
Which of the following is most likely to have an inelastic demand?
A new cancer fighting drug
Organic produce
Toothpaste
Cosmetic surgery
23
Economic investment differs from personal investment in that economic investment...
Refers to individuals putting money in the bank
Refers to investments held by the government
Refers to government spending
Specifically refers to money lent to businesses
24
When comparing a traditional economy with a command economy, which of the following is true?
Private ownership
Free market
Slow economic growth
Fluctuating prices
25
A sustained rise in the level of prices or a fall in the purchasing power of money is what?
Inflation
Deflation
Expansion
Contraction
26
An example of perfect competition is:
Many sellers compete and no one company controls the market
Several businesses form a cartel
A seller is misinformed causing them to overprice goods
A seller decides to sell blue jeans and T-shirts
27
Street lighting is an example of:
Subsidy
A local service
A public good
Utility
28
Why do rising energy costs reduce productivity?
Tools become less expensive to use
Taxes on equipment decrease
Tools become more expensive to use
Taxes on equipment increase
29
If the U.S. dollar is strong compared to the Japanese Yen, then the dollar buys:
More in the U.S. than the Yen buys in Japan
Less in the U.S. than the Yen buys in Japan
More in Japan than the Yen buys in the U.S.
Less in Japan than the Yen buys in the U.S.
30
The U.S. sells manufactured goods to Third World nations and buys raw materials from them...
Protectionism
Voluntary exchange
Global interdependence
Pooling of resources
31
Peaks, recessions, troughs, and expansions are all a part of what?
The Dow Jones
The Federal Reserve
The Business Cycle
The Circular Flow of money
32
What are the two basic tools that the federal government uses to influence the economy?
Fiscal spending
Discretionary spending
Taxation and wages
Taxation and spending
33
Why do suppliers often reduce prices?
They want to create a monopoly
They need more money
They have a shortage
They have a surplus
34
Why is competition in a free market system a good idea?
Supports private ownership
Everyone gets to compete against each other
Producers can create an abundance of new products, cheaper
Prevents scarcity
35
What will happen to the demand curve for lunch at ASU when all students leave for the summer?
Increases
Demand stays the same
Decreases
Hard to say
