Question 1

Fetna resides in a country where the economic system is primarily based on free market capitalism.Fetna is likely to have the freedom to buy and sell property.

Accepted Answer

A) True 
 B)False

Question 2

Under capitalism:

Accepted Answer

A)  Most of the means of production and distribution are privately owned and operated for profit.
B)  The primary function of the government is to distribute wealth more evenly.
C)  Utilities,health care,education,and other important services are operated by the government.
D)  Markets operate to carry out the decisions made by central planners.E) All of the above
F) B) and C)

Question 3

A professor of economics at a prominent university recently urged government policy makers to cut taxes and increase government spending in order to pull the economy out of its current downturn.The policy measures called for by the professor are examples of fiscal policy.

Accepted Answer

A) True 
 B)False

Question 4

Communist values are disappearing because:

Accepted Answer

A)  People in communist nations are tired of the strong religious teachings of the system.
B)  Communist businesses have grown too quickly and they cannot keep up with demand.
C)  Communist leaders are all militaristic.
D)  Shortages abound due to the fact that the government cannot rely on good information.E) B) and D)
F) A) and D)

Question 5

In recent years,countries with communist economic and political systems have:

Accepted Answer

A)  Enjoyed periods of great prosperity.
B)  Experienced severe economic depression.
C)  Placed even more importance on individual ownership of businesses.
D)  Grown very slowly,but have avoided the severe problems that have plagued some capitalist economies in Asia and Europe.E) A) and B)
F) A) and C)

Question 6

The quantity of a good or service that producers are willing to sell at different prices during a specific time period is known as the:

Accepted Answer

A)  Supply of that product or service.
B)  Demand for that product or service.
C)  Elasticity of that product or service.
D)  Utility of that product or service.E) A) and B)
F) All of the above

Question 7

An oligopoly is a market that is characterized by:

Accepted Answer

A)  One firm that totally dominates the supply of the product.
B)  A large number of small firms all producing very similar products.
C)  A few large sellers who dominate the market.
D)  Several small firms that compete primarily by differentiating their products.E) None of the above
F) B) and C)

Question 8

_________ is the name of a free-market economic system in which most of the factors of production and distribution - such as land,factories,railroads,and stores - are owned by individuals.

Accepted Answer

A)  Socialism
B)  Capitalism
C)  Communism
D)  MarginalismE) A) and D)
F) None of the above

Question 9

Thomas Malthus believed that overpopulation was a major cause of poverty.

Accepted Answer

A) True 
 B)False

Question 10

Recently,Hugo Chavez,the Prime Minister of Venezuela announced that he is standing behind the concept of state owned utilities and public schools in his nation.Although not all industry is owned and managed by the government,his ideas would lead one to believe that he has a preference for socialism.

Accepted Answer

A) True 
 B)False

Question 11

To jump-start the economy,the FED is likely to lower interest rates,in order to encourage individuals and businesses to spend money.

Accepted Answer

A) True 
 B)False

Question 12

The four basic types of unemployment are frictional,structural,seasonal,and:

Accepted Answer

A)  cyclical.
B)  procedural.
C)  industrial.
D)  traditional.E) A) and D)
F) A) and C)

Question 13

The study of how society chooses to employ resources to produce goods and services and to distribute them for consumption among various competing groups and individuals is known as sociology.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following statements about productivity in the service sector of the U.S.economy is most accurate?

Accepted Answer

A)  Productivity in the service sector has increased much more rapidly than productivity in the manufacturing sector.
B)  Improving productivity in the service sector is much less important than improving productivity in the manufacturing sector,because the service sector does not really produce anything.
C)  Productivity in the service sector is easier to measure than productivity in agriculture.
D)  Measures of productivity in the service sector do a poor job of taking quality improvements into account.E) All of the above
F) C) and D)

Question 15

When the government attempts to stabilize the economy by changing taxes or government expenditures,it is using fiscal policy.

Accepted Answer

A) True 
 B)False

Question 16

In command economies,the government plays a major role in deciding which goods are produced and who will get them.

Accepted Answer

A) True 
 B)False

Question 17

We use indicators such as 1)the gross domestic product GDP),2)the interest rate,and 3)the price indexes to measure the health of our economy.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following statements most accurately identifies a limitation of the free-market economic system?

Accepted Answer

A)  Free-market economies offer little opportunity for the poor to work their way out of poverty.
B)  Free-market economies have been unable to create wealth as rapidly as other types of economic systems.
C)  Free-market economies are generally plagued by shortages of needed consumer goods.
D)  Free-market economies tend to result in unequal distribution of wealth.E) B) and D)
F) B) and C)

Question 19

The nation of Florentina is in the midst of a serious economic downturn.The nation's GDP has declined steadily for over five years and is now at its lowest level in over fifty years.Florentina's unemployment rate is at an all time high and the nation's CPI is falling.Florentina's economic condition is referred to as a:

Accepted Answer

A)  Period of stagflation.
B)  Balance of trade deficit.
C)  Depression.
D)  Retraction.E) A) and D)
F) None of the above

Question 20

The Federal Reserve Bank operates:

Accepted Answer

A)  as a semi-private organization not under the direct control of the government.
B)  under the direct control of the executive branch of the government.
C)  under the direction of the Banking Oversight Committee of Congress.
D)  as a special agency of the U.S.Treasury.E) A) and B)
F) B) and C)

Exam 2: Understanding Economics and How It Affects Business

Fetna resides in a country where the economic system is primarily based on free market capitalism.Fetna is likely to have the freedom to buy and sell property.

Correct Answer
verified

The study of how society chooses to employ resources to produce goods and services and to distribute them for consumption among various competing groups and individuals is known as sociology.

Correct Answer
verified

The Federal Reserve Bank operates:

Correct Answer
verified

In recent years,countries with communist economic and political systems have:

Correct Answer
verified

Thomas Malthus believed that overpopulation was a major cause of poverty.

Correct Answer
verified

Recently,Hugo Chavez,the Prime Minister of Venezuela announced that he is standing behind the concept of state owned utilities and public schools in his nation.Although not all industry is owned and managed by the government,his ideas would lead one to believe that he has a preference for socialism.

Correct Answer
verified

_________ is the name of a free-market economic system in which most of the factors of production and distribution - such as land,factories,railroads,and stores - are owned by individuals.

Correct Answer
verified

A professor of economics at a prominent university recently urged government policy makers to cut taxes and increase government spending in order to pull the economy out of its current downturn.The policy measures called for by the professor are examples of fiscal policy.

Correct Answer
verified

Correct Answer
verified

The quantity of a good or service that producers are willing to sell at different prices during a specific time period is known as the:

Correct Answer
verified

Which of the following statements about productivity in the service sector of the U.S.economy is most accurate?

Correct Answer
verified

Communist values are disappearing because:

Correct Answer
verified

The four basic types of unemployment are frictional,structural,seasonal,and:

Correct Answer
verified

An oligopoly is a market that is characterized by:

Correct Answer
verified

We use indicators such as 1)the gross domestic product GDP),2)the interest rate,and 3)the price indexes to measure the health of our economy.

Correct Answer
verified

Under capitalism:

Correct Answer
verified

In command economies,the government plays a major role in deciding which goods are produced and who will get them.

Correct Answer
verified

Which of the following statements most accurately identifies a limitation of the free-market economic system?

Correct Answer
verified

To jump-start the economy,the FED is likely to lower interest rates,in order to encourage individuals and businesses to spend money.

Correct Answer
verified

When the government attempts to stabilize the economy by changing taxes or government expenditures,it is using fiscal policy.

Correct Answer
verified

Exam 2: Understanding Economics and How It Affects Business

Fetna resides in a country where the economic system is primarily based on free market capitalism.Fetna is likely to have the freedom to buy and sell property.

Correct AnswerverifiedShow Answer

The study of how society chooses to employ resources to produce goods and services and to distribute them for consumption among various competing groups and individuals is known as sociology.

Correct AnswerverifiedShow Answer

The Federal Reserve Bank operates:

Correct AnswerverifiedShow Answer

In recent years,countries with communist economic and political systems have:

Correct AnswerverifiedShow Answer

Thomas Malthus believed that overpopulation was a major cause of poverty.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

_________ is the name of a free-market economic system in which most of the factors of production and distribution - such as land,factories,railroads,and stores - are owned by individuals.

Correct AnswerverifiedShow Answer

A professor of economics at a prominent university recently urged government policy makers to cut taxes and increase government spending in order to pull the economy out of its current downturn.The policy measures called for by the professor are examples of fiscal policy.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The quantity of a good or service that producers are willing to sell at different prices during a specific time period is known as the:

Correct AnswerverifiedShow Answer

Which of the following statements about productivity in the service sector of the U.S.economy is most accurate?

Correct AnswerverifiedShow Answer

Communist values are disappearing because:

Correct AnswerverifiedShow Answer

The four basic types of unemployment are frictional,structural,seasonal,and:

Correct AnswerverifiedShow Answer

An oligopoly is a market that is characterized by:

Correct AnswerverifiedShow Answer

We use indicators such as 1)the gross domestic product GDP),2)the interest rate,and 3)the price indexes to measure the health of our economy.

Correct AnswerverifiedShow Answer

Under capitalism:

Correct AnswerverifiedShow Answer

In command economies,the government plays a major role in deciding which goods are produced and who will get them.

Correct AnswerverifiedShow Answer

Which of the following statements most accurately identifies a limitation of the free-market economic system?

Correct AnswerverifiedShow Answer

To jump-start the economy,the FED is likely to lower interest rates,in order to encourage individuals and businesses to spend money.

Correct AnswerverifiedShow Answer

When the government attempts to stabilize the economy by changing taxes or government expenditures,it is using fiscal policy.

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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