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Economics Review Quiz
Economics Review Quiz
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Actual test questions for the Economics Exam
Flashcards
70 cards
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Questions
70
Answers
1
The US has a laissez-faire economy
False
True
2
Coin money (made from metal) is called specie.
True
False
3
The government of the United States regulates the economy.
False
True
4
Human beings are rational creatures and therefore always behave rationally in the market.
True
False
5
Monopolies are bad for Capitalism.
True
False
6
What is equilibrium in the market?
when the market is extremely active and prices are rising
When the amount of money equals the number of goods to buy in the economy
Where everything that is produced is sold at just the right price.
when wages for work are equalized and everyone can afford more
7
The President of the United States has the most control over the management of the US economy.
True
False
8
a portion of profit paid to a shareholder
share
profit
dividend
payment
9
Macroeconomics deals with:
the national economy
price of macaronis at Shoprite
small business
economics of the home
10
“From each according to his ability, to each according to his need” is the basic premise for which economic system?
Communism
Capitalism
Anarchism
Socialism
11
The basic law that governs economics is:
Law of Supply
Law of Full Employment
Law of Scarcity
Law of Demand
12
What Economic Law does Communism ignore that makes it doomed to fail from the start?
Law of Comparative Advantage
Law of Supply
Law of Scarcity
Law of Demand
13
Prices on the New York Stock Exchange only influence American markets and have no impact on other markets
False
True
14
Deflation is worse than Inflation.
True
False
15
The objective of Economics is:
To produce as much as possible
To provide the greatest good to the greatest number of people
To measure human economic activity
To make as much money as possible
16
The Law of Supply and Demand governs Economics.
True
False
17
The Business Cycle cannot be avoided or overcome by economists.
True
False
18
Anything can be used as money
False
True
19
Historically, the stock market is one of the best investments available
False
True
20
The basic law that governs economics is:
Law of Demand
Law of Unintended Consequences
Law of Scarcity
Law of Supply
21
According to Adam Smith in the “Wealth of Nations”, what is the Invisible Hand?
government regulations
high prices
big corporations and the rich manipulating the market
self-interest
22
What is the engine that makes Capitalism work?
Government Regulation of the market
Competition in a free market
Wealth
Money
23
Money = Wealth
False
True
24
In economics, rent is the payment for:
Labor that goes into making a product
Apartments the workers live in
land the factory is on
Natural resources, "gifts of the earth"
25
Who gains in a voluntary trade between buyer and seller?
the government through sales tax
the buyer only
both buyer and seller
the seller only
26
Inflation is caused by:
too much money chasing too few goods
too much money chasing too many goods
too little money chasing too few goods
gas, the economy needs to pass some! brabbbbpppptttttt . .
27
The New York Stock Exchange is the most closely watched stock market in the world.
True
False
28
When the stock market loses up to 10% of value in a short period of time it is called a:
crash
shrinkage
reduction in value
correction
29
The fundamental fact of human existence is:
Human wants and needs are unlimited
Beautiful People deserve more than regular people.
Scarcity: there is not enough of anything to go around.
Resources are plentiful, but are distributed unequally
30
What is opportunity cost?
The choice you gave up to make the choice you made
Who you have to pay to get an opportunity
What an opportunity costs in relation to what you gain.
What it costs to create an opportunity
31
What economic system is characterized by a command economy, price controls, no free market and no private property?
Capitalism
Anarchism
Socialism
Communism
32
Economics is so complex nobody understands it completely.
True
False
33
In the 19th century, Economics was often called “The Dismal Science”.
True
False
34
Human wants and needs are limited by the amount of money a person has.
True
False
35
Paper Money is called:
currency
specie
treasuries
barter
36
Economic Progress comes primarily through:
entrepreneurial activity directed by a free market
government planning, oversight and regulation
tax cuts, government spending and equal income distribution
large corporations and monopolies directing business activity
37
Historically the stock market is one of the best investments for the average American.
False
True
38
The United States has a pure, laissez-faire capitalist economy.
False
True
39
Who is the Father of Capitalism and author of “Wealth of Nations”?
Adam Smith
John Locke
Voltaire
Karl Marx
40
Who is responsible for managing the US economy through regulating the money supply and interest rates?
Congress
The Federal Reserve
The President
The Free Market
41
The portion of a company's profit paid to the owner of stock:
Dividend
Stock Share
Bonus
Profit Sharing
42
At what percent in the unemployment index do economists believe the economy is at full employment?
3%
5%
1%
0%
43
Coin money made from metal is called(choose the best response):
specie
currency
coinage
metallica
44
When stock prices fall less than 10% in a trading session:
crash
market flux
liquidity crisis
correction
45
In economics, capital is:
Money
Government place of business
Wealth
Means of Production
46
Economics has to do with almost every aspect of human activity
False
True
47
When stock prices are falling it is called a:
Bear Market
Bird Market
Fish Market
Bull Market
48
Besides being a medium of exchange, money is a tool for assessing and assigning value.
False
True
49
Which economic measurement to we use to calculate the average standard of living for the average citizen?
Per Capita GDP
Unemployment Index
GDP
Stock Market
50
According to Economics, everything is scarce.
False
True
51
Human Needs and Wants are:
unlimited
not part of the economic puzzle
pretty bizarre
limited by scarce resources
52
The US has not had another depression since the Great Depression of the 1930's.
True
False
53
The 8 goals of economics will all be met at some point in the future.
False
True
54
If Capitalism works the way it is supposed to work, it will destroy itself.
False
True
55
The study of the national economy is microeconomics.
True
False
56
When stock prices are rising it is called a:
Bull Market
Fish Market
Bird Market
Bear Market
57
Paper money is called currency.
False
True
58
If Capitalism works the way it is supposed to, it will eventually destroy itself.
False
True
59
Who is the Father of Communism and the author of “The Communist Manifesto”?
Karl Marx
Frederich Engels
Adam Smith
Bernie Sanders
60
Which economic system is characterized by individuals, private property, markets and pursuit of profits?
Capitalism
Socialism
Communism
Anarchism
61
Economics is the study of the allocation of scarce resources.
False
True
62
Economics has to do with most aspects of human activity.
False
True
63
Trading goods for goods is called:
Barter
Capitalism
Free Exchange
Socialism
64
Communism can never really work because it ignores the Law of Scarcity.
True
False
65
Economists have learned so much that they have been able to overcome the business cycle.
True
False
66
There is always equilibrium in the market.
False
True
67
Economists have learned enough to help us avoid the step of depression in the business cycle.
False
True
68
Macroeconomics deals with:
the national economy
the economy regarding macaronis
the economy of small business
the economy of the home
69
Anything can be money as long as we all agree on it.
False
True
70
What does Capitalism focus on?
The machinery of production
The distribution of wealth to all
The machinery of production
The creation of wealth in a free market and profits for the entrepreneur.
