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American Foundations Cycle II
American Foundations Cycle II
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A prep quiz for the American Foundations Cycle II exam
Flashcards
50 cards
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Practice quiz
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Questions
50
Answers
1
Match these words with their representations on the graph:
price, quantity, supply, demand.
B, A, Curve 1, Curve 2
A, B, Curve 1, Curve 2
B, A, Curve 2, Curve 1
A, B, Curve 2, Curve 1
2
Who presented the idea that "political extremism" is the problem with socialist economies?
Adam Smith
Joseph Smith
Spencer W. Kimball
Arthur M. Schlesinger, Jr.
3
What is minimum wage?
Price Floor
Price Ceiling
4
What is the result of a price ceiling?
Shortage
Inflation
Surplus
More expensive products
5
Which Fed Chairman increased money supply after "Crash of 87"?
Alan Greenspan
Paul Volcker
G. William Miller
Janet Yellen
6
What is the first fallacy of free market? (mentioned in class)
Free Gift = Stagnation
Helping Others = Helping Yourself
Self-Interest = Selfish
Self-Centered = Pride
7
Who was Arthur M. Schlesinger, Jr.?
British Historian
French Historian
German Historian
American Historian
8
What is the secret to wealth?
Rich Parents
Smart Government Control
Natural Resources
Free Exchange
9
Who was John Maynard Keynes?
British Economist
German Economist
French Economist
American Economist
10
What is an economic, or market, bubble?
As supply of a product decreases, its price increases.
Trade (in an asset) at price that falls below the true value
Caused by a stock market crash.
Trade (in an asset) at a price that exceeds the true value.
11
Are external controls good or bad for a free market economy?
Bad
Good
12
What is the fourth fallacy of free market? (mentioned in class)
Zero Sum
Nature Satisfied
Culture Contamination
Value Neutral
13
What was his thesis? (or Philosophy)
The Invisible Hand
Monetarism
The Supply and Demand Curves
Beliefs determine economics
14
Selling beef that is infected with e coli deals with which market weakness?
Externalities
Poverty
Imperfect Information
Instability
15
Broulims goes out of business because of Walmart. This deals with which market weakness?
Negative Externality
Disruption
Monopoly
Inequality
16
What book did Milton Friedman and
Anna Schwartz
write?
The Rise of Capitalism
The Rise and Fall of American Growth
A Short History of Financial Euphoria
Monetary History of the United States
17
According to his book, "
The Vital Center
," where is success found?
In the middle ground between man and women
In the middle ground between communism and fascism
In the middle ground between democracy and communism
In the middle ground between tyranny and anarchy
18
Which Fed chairman helped cure inflation during the late 70's?
Paul Volcker
Alan Greenspan
Andrew Carnegie
Milton Friedman
19
What book did Adam Smith write?
The General Theory of Employment, Interest, and Money
The Spirit of Capitalism
A Monetary History of the United States
The Wealth of Nations
20
What are the possible negative consequences of an increase in money supply?
Inflation and shortage
Inflation and surplus
Inflation and "bubbles"
Inflation and stock market crash
21
What is the second fallacy of free market? (mentioned in class)
Cooperation is bad
Competition is bad
Cooperation = Consumer Rules
Competition = Monopoly
22
According to Keynesianism, what causes economic downturns?
Insufficient supply
Surplus of goods
Shortage of goods
Insufficient demand.
23
What is the remedy for this market weakness (imperfect information)?
The Internet
Internal Controls
External Controls
Provide Basic Welfare
24
What is Monetarism?
Decrease money supply to combat economic recession
Increased money supply causes an increase in interest rates
Changes in money supply can determine economic performance
Increase interest rates to combat economic recession.
25
According to Keynesianism, what can prevent, or stop, economic downturns?
Less government spending
Increase $ supply and lower interest rates.
Decrease the money supply
Cutting taxes and more government spending.
26
Who said, "self-aggrandizement . . . is a correct principle . . . ?"
Adam Smith
Brigham Young
Andrew Carnegie
Joseph Smith
27
Who was Andrew Carnegie?
Inherited a fortune, including a steelmaking company.
Opposed philanthropy
Eventually owned all the oil companies.
Scottish immigrant that became the richest man in 1900's
28
Who presented the idea of a Charter City on TED talks?
Alan Greenspan
Tim Jackson
Paul Romer
Joseph Pine
29
Which is
NOT
an internal control?
Regulations
Rules
Limited international trade
Inspections of products
30
Which is
NOT
one of the functions of money?
Unit of Interest
Store of Value
Unit of Account
Medium of Exchange
31
Where do both curves meet (the blue dot at the center of the X)?
Break-Over Point
Focus Point
Greenspan Point
Equilibrium Point
32
Who is Milton Friedman?
Economist during the Great Depression
Economist with the monetarist view point
Economist during World War II
Economist with a strong belief in keynesianism
33
Which was part of Adam Smith's philosophy?
The Supply and Demand Curves
The Invisible Hand
Monetarism
Beliefs Determine Economics
34
Using a new road that was made by the government deals with which market weakness?
Inequality
Negative Externality
Positive Externality
Business Cylce
35
What happens when someone specializes in a certain trade or skill?
Their trading options become limited.
Cost goes up. (due to improved quality)
Lowers the marginal opportunity cost of production.
Become unreliable elsewhere, which lowers the economy.
36
What is the third fallacy of free market? (mentioned in class)
Profit = Greed
Greed = Unhealthy lust for money
Free Markets = Evil Incentives
Free Market System = Poor get richer
37
What are the three economic systems?
Free Market, Government Market, People's Market
Capitalist, Chaos, Command (Planned)
Free Market, Socialist, Democratic
External, Free Market, Internal
38
What is a Chaos Economy?
An economy of disorderly bidding
An economy with unpredictable government intervention
An economy in which criminal's prevent free exchange
An economy based of force by the military
39
Who is Adam Smith?
British Economist
German Sociologist
Scottish Economist
American Economist
40
Which does
NOT
happen when the Fed Increases the money supply?
Money holds its value indefinately
Economy is stimulated
Bank failure is prevented
Interest rates lower
41
What is a Command (Planned) Economy?
Governments agree to trade with eachother
People use their property how they want
Socialism
The government controls trade and other economic activity
42
What are External Controls?
Taxes
Government prevention of regulations.
Limited international trade
Lawsuits
43
What was his philosophy?
Post-Scarcity Economics
Classical Economics
Monetarism
Keynesianism
44
What book did Max Weber write?
The Origin of Wealth
The Theory of Religious Economy
The Protestant Ethic and Spirit of Capitalism
Religion and the Rise of Capitalism
45
What is the result of a price floor?
Cheaper products
Inflation
Shortage
Surplus
46
What are the seven weaknesses of the free market economy?
Do not pick me
Pick me
47
Who was Max Weber?
American Economist
British Economist
Scottish Economist
German Sociologist
48
What is the remedy for this market weakness (Externalities)?
External Controls
Provide Basic Welfare
Internal Controls
49
What book did he write?
The Spirit of Capitalism
A Monetary History of the United States
The General Theory of Employment, Interest, and Money
The Rise and Fall of American Growth
50
What is the remedy for this market weakness (Disruption)?
Life Insurance
Provide Basic Welfare
External Controls
Internal Controls
