Econ Final Exam Review

Question 1

A licensed professional who buys and sells stocks and shares in exchange for a fee.

Accepted Answer

stockbroker

Question 2

Every decision involves trade-offs because:

Accepted Answer

everyone’s resources are limited.

Question 3

What date was “Black Tuesday” based on the huge loss of stock value on the US stock market?

Accepted Answer

Oct 29, 1929

Question 4

Why might the Soviet planners have favored heavy industry over the makers of consumer goods?

Accepted Answer

Products of industry provided material for other industries.

Question 5

Where are traditional economies usually found?

Accepted Answer

in small communities that avoid change

Question 6

Money raised by companies to finance new ventures in exchange for percentage ownership.

Accepted Answer

Venture capital

Question 7

What must a nation’s economy do in order to improve the standard of living?

Accepted Answer

grow

Question 8

In a Bull Market, what is necessary for people to make money (increase value of their stock)?

Accepted Answer

require more buyers than buyers (of stock shares)

Question 9

Companies _____________ stock to put it into the market allowing a company's shares for sale.

Accepted Answer

issue

Question 10

The debts and obligations of a company or an individual.

Accepted Answer

Liabilities

Question 11

What effect do rising input costs have on the price of a good?

Accepted Answer

The good becomes more expensive to produce.

Question 12

How does new technology generally affect production?

Accepted Answer

It lowers cost and increases supply.

Question 13

What is considered a negative effect of government regulations?

Accepted Answer

All of the above.

Question 14

Why do people need to buy and sell products or services?

Accepted Answer

No one is self-sufficient.

Question 15

What basic principles are fundamental to American free enterprise?

Accepted Answer

open opportunity, private property, contracts, open exchange

Question 16

When the price of a product goes down, what happens to producers?

Accepted Answer

Some produce less, and others leave the market.

Question 17

Products such as wood, oil and metals are traded on a separate _______________ exchange.

Accepted Answer

Commodities

Question 18

A _______________________ represents the number of shares owned by an investor.

Accepted Answer

Share certificate

Question 19

What does the economic concept of “guns or butter”mean?

Accepted Answer

Government must decide to make military or consumer goods.

Question 20

Why has America been referred to as the “land of opportunity”?

Accepted Answer

Provides the possibility of success through hard work.

Question 21

How does a society determine who will get what is produced?

Accepted Answer

by its distribution of income

Question 22

Stocks of leading companies with a reputation for stable growth and earnings are known as:

Accepted Answer

blue chip

Question 23

Traditional economies are usually:

Accepted Answer

small communities that avoid change and new technology.

Question 24

Transferable certificates showing ownership of stocks, bonds, shares, options, etc.

Accepted Answer

Securities

Question 25

What is the difference between a shortage and a scarcity?

Accepted Answer

A shortage can be short or long, but scarcity always exists.

Question 26

Money and other property of companies used in transacting the business.

Accepted Answer

Capital

Question 27

How is the economic system in China today different from the one in Soviet Russia?

Accepted Answer

The Chinese government allows far more economic freedom.

Question 28

What is one reason the U.S. government regulates car manufacturing?

Accepted Answer

to offset the pollution caused by cars

Question 29

If you choose between two summer jobs, the one you do not choose is the _____ of your decision.

Accepted Answer

opportunity cost

Question 30

All those who have access to secret information concerning the company are known as:

Accepted Answer

insiders

Question 31

Period during which the Stock Exchange is open for trading.

Accepted Answer

Trading session

Question 32

Various types of securities held by an individual or institution.

Accepted Answer

Portfolio

Question 33

Stocks and shares which represent a portion of the capital of a company.

Accepted Answer

Equities

Question 34

What “invisible hand” regulates the free market economy?

Accepted Answer

competition and self-interest

Question 35

The price a buyer is willing to offer for shares in a company is known as:

Accepted Answer

a bid

Question 36

How did heavy industry in the USSR avoid the competition that drives a free market economy?

Accepted Answer

The USSR determined prices, wages, and products.

Question 37

The capital of a company is divided into ____________ which give the owner some of the profits.

Accepted Answer

shares

Question 38

What happens as production of one item switches to the production of another item?

Accepted Answer

More resources are needed.

Question 39

What is one reason European governments protect the growing of food with subsidies?

Accepted Answer

to have food in case imports are ever restricted

Question 40

IPO or selling part of a company on the stock market is the acronym (abbreviation) for:

Accepted Answer

Initial Public Offering

Question 41

Someone who buys or sells stocks in the hope of making a profit through changes in their value.

Accepted Answer

speculator

Question 42

A portion of a company’s earnings paid to the stockholders on a quarterly or annual basis.

Accepted Answer

Dividends

Question 43

The economic concept of guns or butter means that:

Accepted Answer

government must decide on more military or consumer goods.

Question 44

The stocks highest and lowest values for the day in indicated by its:

Accepted Answer

range

Question 45

To recover money from a sell short investment a stock trader would:

Accepted Answer

buy to cover

Question 46

The right to buy and sell certain securities at a specified price and period of time.

Accepted Answer

Option

Question 47

How were people able to buy stock beyond what their saving s would allow ( before 1929)?

Accepted Answer

bought stock on margin

Question 48

Person who owns stocks and shares is known as a:

Accepted Answer

stockholder

Question 49

In what way does the Bill of Rights protect individuals’ to engage in business activities?

Accepted Answer

It recognizes property rights.

Question 50

Savings fund that uses cash from savers to buy securities such as stock, bonds or real estate.

Accepted Answer

Mutual fund

Question 51

In what situation would a factory that is losing money keep operating?

Accepted Answer

if total revenue is greater than operating cost

Question 52

A stocks market cap is:

Accepted Answer

The total $ market value of a company's outstanding shares.

Question 53

Return on (a stock) investment shown as a percentage is known as:

Accepted Answer

yield

Econ Final Exam Review

Questions 53

Econ Final Exam Review

Questions 53