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