ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are...
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Transcript of ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are...
![Page 1: ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are limited d.can only be used once.](https://reader036.fdocuments.us/reader036/viewer/2022070410/56649eff5503460f94c14650/html5/thumbnails/1.jpg)
ECONOMICS EXAM REVIEW
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Choices are made because resources
a. may run outb. have alternate usesc. are limitedd. can only be used once
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Choices are made because resources
a. may run outb. have alternate usesc. are limitedd. can only be used once
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Because of scarcity
a. people are forced to make choices
b. opportunity costs existc. People face trade-offsd. All of the above
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Because of scarcity
a. people are forced to make choices
b. opportunity costs existc. People face trade-offsd. All of the above
![Page 6: ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are limited d.can only be used once.](https://reader036.fdocuments.us/reader036/viewer/2022070410/56649eff5503460f94c14650/html5/thumbnails/6.jpg)
All the combinations of goods and services that can be produced in a given period of time with a fixed amount of resources are called
a. opportunity costs b. production possibilities c. factors of production d. trade-offs
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All the combinations of goods and services that can be produced in a given period of time with a fixed amount of resources are called
a. opportunity costs b. production possibilities c. factors of production d. trade-offs
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Which of the following will cause the production possibilities curve to shift
outward?
a. a reduction in the size of the labor force
b. an increase in the quantity of labor
c. an inefficiency that is corrected d. a decrease in the amount of
capital
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Which of the following will cause the production possibilities curve to shift
outward?
a. a reduction in the size of the labor force
b. an increase in the quantity of labor
c. an inefficiency that is corrected d. a decrease in the amount of
capital
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When a nation increases its number of capital goods, it is usually true
that
a. it must do without some consumer goods in the present
b. labor must decline c. fewer consumer goods will be
available in the future
d. no opportunity costs exist for doing so
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When a nation increases its number of capital goods, it is usually true
that
a. it must do without some consumer goods in the present
b. labor must decline c. fewer consumer goods will be
available in the future d. no opportunity costs exist for
doing so
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The opportunity cost of growing corn is
a. no wheat b. no dairy products c. no soybeans d. whatever is valued as the
next most important to growing corn
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The opportunity cost of growing corn is
a. no wheat b. no dairy products c. no soybeans d. whatever is valued as the
next most important to growing corn
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Because specialized resources are more suited to specific tasks, the extra cost of
producing additional units will rise. This is due to
a. production possibilities b. scarcity c. law of increasing relative
costs d. opportunity costs
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Because specialized resources are more suited to specific tasks, the extra cost of
producing additional units will rise. This is due to
a. production possibilities b. scarcity c. law of increasing relative
costs d. opportunity costs
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TRUE OR FALSE
The major purpose of economics is to understand choices.
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TRUE OR FALSE
The major purpose of economics is to understand choices.
TRUE
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TRUE OR FALSE
Because resources are scarce, the goods they produce are also scarce.
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TRUE OR FALSE
Because resources are scarce, the goods they produce are also scarce.
TRUE
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Which of the groups below best represent the factors of production?
a. teachers, lawyers, factory workers
b. trucks, factory workers, water c. factory workers, trucks,
hammers d. iron ore, water, trees
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Which of the groups below best represent the factors of production?
a. teachers, lawyers, factory workers
b. trucks, factory workers, water c. factory workers, trucks,
hammers d. iron ore, water, trees
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TRUE OR FALSE
For most choices, there is no opportunity cost.
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TRUE OR FALSE
For most choices, there is no opportunity cost.
FALSE
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Modern technology is resulting in
a. better quality goods b. inefficient use of resouces c. less leisure time d. higher prices
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Modern technology is resulting in
a. better quality goods b. inefficient use of resouces c. less leisure time d. higher prices
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Specialization results in
a. increased number of goods
b. greater efficiency c. economic
interdependence d. all of the above
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Specialization results in
a. increased number of goods
b. greater efficiency c. economic
interdependence d. all of the above
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If price rises
a. buyers will buy less b. buyers will buy more c. buyers will buy the same
amount d. none of the above
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If price rises
a. buyers will buy less b. buyers will buy more c. buyers will buy the same
amount d. none of the above
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A pure market economy would not have
a. government control b. competition c. private property d. freedom of choice
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A pure market economy would not have
a. government control b. competition c. private property d. freedom of choice
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The American economy can best be described as
a. socialism b. capitalism c. communism d. a command economy
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The American economy can best be described as
a. socialism b. capitalism c. communism d. a command economy
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Analogy: The price system is to a market economy as ______is to a
command economy.
a. income redistribution b. customs and traditions c. government planning d. human capital
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Analogy: The price system is to a market economy as ______is to a
command economy.
a. income redistribution b. customs and traditions c. government planning d. human capital
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In a capitalist economic system, the factors of production are usually
controlled by
a. the government b. large monopolies c. individuals d. corporations
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In a capitalist economic system, the factors of production are usually
controlled by
a. the government b. large monopolies c. individuals d. corporations
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TRUE OR FALSE
In a command economic system, the individual has a say in the way the three basic economic questions are answered.
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TRUE OR FALSE
In a command economic system, the individual has a say in the way the three basic economic questions are answered.
FALSE
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TRUE OR FALSE
A mixed economic system contains elements of the three other economic systems.
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TRUE OR FALSE
A mixed economic system contains elements of the three other economic systems.
TRUE
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TRUE OR FALSE
Entrepreneurship is encouraged by freedom of choice and competition.
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TRUE OR FALSE
Entrepreneurship is encouraged by freedom of choice and competition.
TRUE
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TRUE OR FALSE
A traditional economy is based on how things have been done before.
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TRUE OR FALSE
A traditional economy is based on how things have been done before.
TRUE
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TRUE OR FALSE
Most countries have mixed economic systems.
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TRUE OR FALSE
Most countries have mixed economic systems.
TRUE
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One criticism of Capitalism is that
a. it prevents economic growth b. its income distribution is
unequal c. its living standards are lower
than in socialist economies d. its individuals own very little
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One criticism of Capitalism is that
a. it prevents economic growth b. its income distribution is
unequal c. its living standards are lower
than in socialist economies d. its individuals own very little
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The way goods and services are produced in a market economy is
a. determined by government standards
b. with the least-cost combination of resources
c. inefficient d. no different than in a command
economy
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The way goods and services are produced in a market economy is
a. determined by government standards
b. with the least-cost combination of resources
c. inefficient d. no different than in a command
economy
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A demand schedule
a. relates price to quantity demanded
b. is a demand curve when it is graphed
c. cannot change d. shows a direct relationship
between price and quantity demanded
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A demand schedule
a. relates price to quantity demanded
b. is a demand curve when it is graphed
c. cannot change d. shows a direct relationship
between price and quantity demanded
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If the price of good A rises and the demand for good B rises, then A and
B are a. substitutes b. complements c. not related goods d. not scarce goods
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If the price of good A rises and the demand for good B rises, then A and
B are a. substitutes b. complements c. not related goods d. not scarce goods
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Recently some cities in Alabama passed a law that limited showers to 4 minutes, with a possible 30-day jail sentence for
violators. Which of the following is probably true?
a. a surplus of water existed b. the price of water was too high c. a shortage of water existed no
matter how high the price d. the price of water was below the
equilibrium price
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Recently some cities in Alabama passed a law that limited showers to 4 minutes, with a possible 30-day jail sentence for
violators. Which of the following is probably true?
a. a surplus of water existed b. the price of water was too high c. a shortage of water existed no
matter how high the price d. the price of water was below the
equilibrium price
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If the supply of gasoline rises and demand does not change, then
a. the relative price of gasoline will rise
b. the equilibrium price of gasoline will increase
c. the equilibrium quantity of gasoline will increase
d. the equilibrium price and equilibrium quantity of gasoline will increase
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If the supply of gasoline rises and demand does not change, then
a. the relative price of gasoline will rise
b. the equilibrium price of gasoline will increase
c. the equilibrium quantity of gasoline will increase
d. the equilibrium price and equilibrium quantity of gasoline will increase
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Which of the following will lead to an increase in supply?
a. an increase in the price of a good b. a technological improvement in
the production of the good c. an increase in the price of labor d. all of the above
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Which of the following will lead to an increase in supply?
a. an increase in the price of a good b. a technological improvement in
the production of the good c. an increase in the price of labor d. all of the above
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Prolonged shortages may come about if
a. demand increases relative to supply
b. price floors are set by government c. prices are not allowed to rise to
equilibrium d. buyers are allowed to compete for
goods
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Prolonged shortages may come about if
a. demand increases relative to supply
b. price floors are set by government c. prices are not allowed to rise to
equilibrium d. buyers are allowed to compete for
goods
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Which of the following goods probably has the most elastic
demand?
a. salt b. food c. alcoholic beverages d. private school education
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Which of the following goods probably has the most elastic
demand?
a. salt b. food c. alcoholic beverages d. private school education
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Which of the following is not true concerning a proprietorship?
a. most U.S. firms are proprietorships
b. they are easy to form and dissolve
c. they offer limited liability d. profits are only taxed once
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Which of the following is not true concerning a proprietorship?
a. most U.S. firms are proprietorships
b. they are easy to form and dissolve
c. they offer limited liability d. profits are only taxed once
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A corporation
a. is a legal entity that conducts business in its own name
b. permits unlimited liability to shareholders
c. must be dissolved if a majority stockholder dies
d. has severely limited abilities to attract financial resources
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A corporation
a. is a legal entity that conducts business in its own name
b. permits unlimited liability to shareholders
c. must be dissolved if a majority stockholder dies
d. has severely limited abilities to attract financial resources
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Shareholders
a. are the owners of corporations b. are less at risk than are
bondholders c. are subject to unlimited risk d. have less control over firm
decisions than do bondholders
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Shareholders
a. are the owners of corporations b. are less at risk than are
bondholders c. are subject to unlimited risk d. have less control over firm
decisions than do bondholders
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Which of the following is not a characteristic of the monopoly
market structure?
a. one seller b. unique product c. restricted entry d. price taker
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Which of the following is not a characteristic of the monopoly
market structure?
a. one seller b. unique product c. restricted entry d. price taker
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Which firm has the least control over price?
a. perfect competitor b. monopolistic competitor c. oligopolist d. monopolist
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Which firm has the least control over price?
a. perfect competitor b. monopolistic competitor c. oligopolist d. monopolist
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Nonprice competition or advertising
a. attempts to increase demand for one’s product
b. helps to differentiate one’s product
c. can lead to more information to buyers
d. all of the above
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Nonprice competition or advertising
a. attempts to increase demand for one’s product
b. helps to differentiate one’s product
c. can lead to more information to buyers
d. all of the above
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Corporations obtain most of the funds they need for expansion from
a. the sale of stock b. the sale of bonds c. short-term borrowing d. undistributed profits
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Corporations obtain most of the funds they need for expansion from
a. the sale of stock b. the sale of bonds c. short-term borrowing d. undistributed profits
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Which of the following is least likely to result in increased productivity?
a. efficient use of natural resources b. employee training programs c. improved machinery d. working overtime
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Which of the following is least likely to result in increased productivity?
a. efficient use of natural resources b. employee training programs c. improved machinery d. working overtime
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The most significant impact of technology on production has been
a. lower wages b. higher consumer prices c. poor-quality goods d. increased productivity
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The most significant impact of technology on production has been
a. lower wages b. higher consumer prices c. poor-quality goods d. increased productivity
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In the last twenty years in the United
States, there has been a sizable increase in the number of
a. laborers b. service workers c. farm workers d. manufacturing workers
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In the last twenty years in the United
States, there has been a sizable increase in the number of
a. laborers b. service workers c. farm workers d. manufacturing workers
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The most important reason some people are paid more than others is
a. dirty or dull and repetitive work
b. talent and skill level differences
c. geographic location of the job d. discrimination against
minorities
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The most important reason some people are paid more than others is
a. dirty or dull and repetitive work
b. talent and skill level differences
c. geographic location of the job d. discrimination against
minorities
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Training, experience, and education are all considered
a. investment in human capital b. capital c. economic inequalities d. economic equalities
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Training, experience, and education are all considered
a. investment in human capital b. capital c. economic inequalities d. economic equalities
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Most of the nation’s output of goods and services is purchased by
a. consumers b. business firms c. government d. foreign countries
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Most of the nation’s output of goods and services is purchased by
a. consumers b. business firms c. government d. foreign countries
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Income left over after taxes have been paid is called
a. discretionary family income b. disposable family income c. real family income d. money family income
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Income left over after taxes have been paid is called
a. discretionary family income b. disposable family income c. real family income d. money family income
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The only three ways a person can dispose of income is through
a. taxes, necessities, and luxuries b. necessities, luxuries, and savings c. taxes, consumption,
expenditures, and recreation d. consumption expenditures, taxes
and savings
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The only three ways a person can dispose of income is through
a. taxes, necessities, and luxuries b. necessities, luxuries, and savings c. taxes, consumption,
expenditures, and recreation d. consumption expenditures, taxes
and savings
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The profit made on a sale of stock is known as
a. interest b. brokerage fee c. equity d. capital gain
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The profit made on a sale of stock is known as
a. interest b. brokerage fee c. equity d. capital gain
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A transaction that has an effect on a third party is called a (n)
a. merit good b. public good c. externality d. private good
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A transaction that has an effect on a third party is called a (n)
a. merit good b. public good c. externality d. private good
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The amount of return possible on an investment increases directly with
the
a. amount of risk b. amount of insurance c. financial advice d. mutual fund
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The amount of return possible on an investment increases directly with
the
a. amount of risk b. amount of insurance c. financial advice d. mutual fund
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A taxation system in which tax rates fall as income increases is
a. regressive b. proportional c. progressive d. all of the above
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A taxation system in which tax rates fall as income increases is
a. regressive b. proportional c. progressive d. all of the above
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TRUE OR FALSE
In a market system, the consumer “votes” for the goods and services he wants to see produced.
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TRUE OR FALSE
In a market system, the consumer “votes” for the goods and services he wants to see produced.
TRUE
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TRUE OR FALSE
If the quality of labor decreases, the production possibilities curve will shift outward.
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TRUE OR FALSE
If the quality of labor decreases, the production possibilities curve will shift outward.
FALSE
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TRUE OR FALSE
It is impossible for a nation to operate at a point inside its production possibilities curve.
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TRUE OR FALSE
It is impossible for a nation to operate at a point inside its production possibilities curve.
FALSE
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TRUE OR FALSE
Economic growth shifts the production possibilities curve outward from the origin.
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TRUE OR FALSE
Economic growth shifts the production possibilities curve outward from the origin.
TRUE
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TRUE OR FALSE
The market system does not adequately provide for the needs of all people.
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TRUE OR FALSE
The market system does not adequately provide for the needs of all people.
TRUE
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TRUE OR FALSE
Capitalism is another name for the free enterprise system.
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TRUE OR FALSE
Capitalism is another name for the free enterprise system.
TRUE
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TRUE OR FALSE
Competition has a negative effect on the U.S. consumer in the long run.
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TRUE OR FALSE
Competition has a negative effect on the U.S. consumer in the long run.
false
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A proportional tax system
a. is unfair b. cannot be consistent with the ability to
pay system c. means that upper income people pay a
smaller percentage of their income in taxes
d. requires upper income people to pay more tax dollars than lower income people
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A proportional tax system
a. is unfair b. cannot be consistent with the ability to
pay system c. means that upper income people pay a
smaller percentage of their income in taxes
d. requires upper income people to pay more tax dollars than lower income people
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All of the following are considered benefits of economic growth except
a. higher employment levels b. higher living standards c. inflation d. income security
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All of the following are considered benefits of economic growth except
a. higher employment levels b. higher living standards c. inflation d. income security
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The idea that GDP should increase only enough to accommodate
population growth is called
a. sustainable growth b. unlimited economic growth c. zero economic growth d. productive capacity
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The idea that GDP should increase only enough to accommodate
population growth is called
a. sustainable growth b. unlimited economic growth c. zero economic growth d. productive capacity
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Which of the following would not be a characteristic of a period of
economic growth?
a. declining investment b. declining unemployment c. expanding credit d. rising productivity
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Which of the following would not be a characteristic of a period of
economic growth?
a. declining investment b. declining unemployment c. expanding credit d. rising productivity
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Which of the following is a function of money?
a. medium of exchange b. unit of accounting c. store of value d. all of the above
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Which of the following is a function of money?
a. medium of exchange b. unit of accounting c. store of value d. all of the above
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Which is not considered money?
a. checking account balances b. Federal Reserve notes c. credit cards d. coins
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Which is not considered money?
a. checking account balances b. Federal Reserve notes c. credit cards d. coins
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Which of the following is an advantage of money over barter?
a. permits more specialization of labor
b. does not require a double coincidence of wants
c. makes exchange faster d. all of the above
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Which of the following is an advantage of money over barter?
a. permits more specialization of labor
b. does not require a double coincidence of wants
c. makes exchange faster d. all of the above
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Which of the following is probably the least liquid?
a. savings account balances b. shares of stock in a major
corporation c. washing machines d. automobiles
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Which of the following is probably the least liquid?
a. savings account balances b. shares of stock in a major
corporation c. washing machines d. automobiles
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Which of the following is not a part of M1?
a. savings account balances b. traveler’s checks c. currency d. unused credit card balances
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Which of the following is not a part of M1?
a. savings account balances b. traveler’s checks c. currency d. unused credit card balances
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Which of the following is the most important function of the FED?
a. regulate the money supply b. supervise member banks c. supply the economy with
currency d. hold member bank’s deposits
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Which of the following is the most important function of the FED?
a. regulate the money supply b. supervise member banks c. supply the economy with
currency d. hold member bank’s deposits
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Under a fiat monetary standard, money is backed by
a. gold b. public faith that money can be
exchanged for goods and services c. precious metals that can be
exchanged for goods and services d. the Treasury’s assets
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Under a fiat monetary standard, money is backed by
a. gold b. public faith that money can be
exchanged for goods and services c. precious metals that can be
exchanged for goods and services d. the Treasury’s assets
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Legal reserves include
a. Vault cash and deposits at the FED
b. US government securitiesc. Goldd. All of the above
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Legal reserves include
a. Vault cash and deposits at the FED
b. US government securitiesc. Goldd. All of the above
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The goal of sound monetary policy is to
a. shrink the money supplyb. Balance tight and loose policyc. Control banksd. Increase the money supply
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The goal of sound monetary policy is to
a. shrink the money supplyb. Balance tight and loose policyc. Control banksd. Increase the money supply
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If the FED wanted to reduce the money supply, it would
a. cut discount rates b. buy government securities c. increase the reserve
requirement d. eliminate the reserve
requirement
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If the FED wanted to reduce the money supply, it would
a. cut discount rates b. buy government securities c. increase the reserve
requirement d. eliminate the reserve
requirement
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When the government sells securities on the open market,
money is
a. put into the economy b. increased in value c. taken out of the economy d. the same supply
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When the government sells securities on the open market,
money is
a. put into the economy b. increased in value c. taken out of the economy d. the same supply
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To regulate the supply of money, the FED may use all of the following
tools EXCEPT
a. discount rate b. reserve requirements c. open-market operations d. prime rates
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To regulate the supply of money, the FED may use all of the following
tools EXCEPT
a. discount rate b. reserve requirements c. open-market operations d. prime rates
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During a period of inflation, the average consumer
a. looses purchasing power b. gains credit easily c. raises his standard of living d. borrows more
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During a period of inflation, the average consumer
a. looses purchasing power b. gains credit easily c. raises his standard of living d. borrows more
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Which of the following best represents a nation’s standard of
living?
a. nominal GDP b. real GDP c. per capita real GDP d. per capita nominal GDP
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Which of the following best represents a nation’s standard of
living?
a. nominal GDP b. real GDP c. per capita real GDP d. per capita nominal GDP
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Which of the following is not a cause of cost-push inflation?
a. An increase in demand at full employment
b. An increase in the price of a raw material
c. Wage increases due to union activity
d. Price increases to increase profits
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Which of the following is not a cause of cost-push inflation?
a. An increase in demand at full employment
b. An increase in the price of a raw material
c. Wage increases due to union activity
d. Price increases to increase profits
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The use of taxation and spending policies to regulate the economy is
called
a. Fiscal policy b. Normative manipulation c. spillover d. monetary policy
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The use of taxation and spending policies to regulate the economy is
called
a. Fiscal policy b. Normative manipulation c. spillover d. monetary policy
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The control of the money supply and credit to regulate the economy is
called
a. Fiscal policy b. Normative manipulation c. spillover d. monetary policy
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The control of the money supply and credit to regulate the economy is
called
a. Fiscal policy b. Normative manipulation c. spillover d. monetary policy
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The only sector of the economy that can act in the best interest of the
economy is
a. Consumers b. Government c. business d. foreign countries
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The only sector of the economy that can act in the best interest of the
economy is
a. Consumers b. Government c. business d. foreign countries
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If the U.S. imports more than it exports it would lead to a
a. Trade balanceb. Trade deficitc. Positive balance of traded. Fixed foreign exchange market
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If the U.S. imports more than it exports it would lead to a
a. Trade balanceb. Trade deficitc. Positive balance of traded. Fixed foreign exchange market
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TRUE OR FALSE
Entrepreneurship is encouraged by
freedom of choice and competition.
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TRUE OR FALSE
Entrepreneurship is encouraged by
freedom of choice and competition.
TRUE
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TRUE OR FALSE
All persons in the United States have the right to own personal property, land, factories, farms and businesses.
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TRUE OR FALSE
All persons in the United States have the right to own personal property, land, factories, farms and businesses.
TRUE
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TRUE OR FALSE
The government is not allowed to buy private property for public purposes.
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TRUE OR FALSE
The government is not allowed to buy private property for public purposes.
FALSE
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TRUE OR FALSE
In a market system, the consumer “votes” for the goods and services he wants to see produced.
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TRUE OR FALSE
In a market system, the consumer “votes” for the goods and services he wants to see produced.
TRUE
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TRUE OR FALSE
A change in the quantity demanded of cigarettes is the result of a change in the price of cigarettes.
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TRUE OR FALSE
A change in the quantity demanded of cigarettes is the result of a change in the price of cigarettes.
TRUE
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TRUE OR FALSE
An increase in price will cause a leftward shift in demand a rightward shift in supply.
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TRUE OR FALSE
An increase in price will cause a leftward shift in demand a rightward shift in supply.
TRUE
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TRUE OR FALSE
Buyers tend to change to lower-priced from higher-priced goods, according to the substitution effect.
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TRUE OR FALSE
Buyers tend to change to lower-priced from higher-priced goods, according to the substitution effect.
TRUE
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TRUE OR FALSE
If the price of tennis racquets rises, then the demand for tennis balls will tend to rise also.
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TRUE OR FALSE
If the price of tennis racquets rises, then the demand for tennis balls will tend to rise also.
FALSE
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TRUE OR FALSE
If the price of cassettes rises, the demand for CD’s will rise.
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TRUE OR FALSE
If the price of cassettes rises, the demand for CD’s will rise.
TRUE
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TRUE OR FALSE
If the price is below the equilibrium price, a shortage will develop.
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TRUE OR FALSE
If the price is below the equilibrium price, a shortage will develop.
TRUE
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TRUE OR FALSE
If supply shifts to the left and demand does not change, then the equilibrium price and the equilibrium quantity will rise.
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TRUE OR FALSE
If supply shifts to the left and demand does not change, then the equilibrium price and the equilibrium quantity will rise.
FALSE
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TRUE OR FALSE
If demand shifts to the left and supply does not change, then the equilibrium price and the equilibrium quantity will fall.
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TRUE OR FALSE
If demand shifts to the left and supply does not change, then the equilibrium price and the equilibrium quantity will fall.
TRUE
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TRUE OR FALSE
Minimum wage laws are a form of price ceiling.
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TRUE OR FALSE
Minimum wage laws are a form of price ceiling.
FALSE
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TRUE OR FALSE
Increasing productivity makes goods more expensive.
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TRUE OR FALSE
Increasing productivity makes goods more expensive.
false
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TRUE OR FALSE
Productivity refers to the efficiency with which we produce goods and services.
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TRUE OR FALSE
Productivity refers to the efficiency with which we produce goods and services.
true
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TRUE OR FALSE
A firm in a perfectly competitive industry is a price-taker.
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TRUE OR FALSE
A firm in a perfectly competitive industry is a price-taker.
true
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TRUE OR FALSE
A geographic monopoly exists when the market is not large enough to support more than one seller.
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TRUE OR FALSE
A geographic monopoly exists when the market is not large enough to support more than one seller.
true
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TRUE OR FALSE
The presence of many buyers and sellers in the market is a characteristic of an oligopoly.
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TRUE OR FALSE
The presence of many buyers and sellers in the market is a characteristic of an oligopoly.
false
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TRUE OR FALSE
The increase in farm productivity is the result of advances in science and technology.
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TRUE OR FALSE
The increase in farm productivity is the result of advances in science and technology.
true
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TRUE OR FALSE
The breakfast food industry is a good example of an oligopoly.
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TRUE OR FALSE
The breakfast food industry is a good example of an oligopoly.
true
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TRUE OR FALSE
Corporations are the most common business organization in the U.S.
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TRUE OR FALSE
Corporations are the most common business organization in the U.S.
false
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TRUE OR FALSE
Proprietorships account for the largest amount of business revenues.
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TRUE OR FALSE
Proprietorships account for the largest amount of business revenues.
false
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TRUE OR FALSE
Corporate shareholders are taxed twice on the corporations earnings.
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TRUE OR FALSE
Corporate shareholders are taxed twice on the corporations earnings.
true
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TRUE OR FALSE
Proprietorships and partnerships face limited liability for the debts of their firms.
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TRUE OR FALSE
Proprietorships and partnerships face limited liability for the debts of their firms.
false
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TRUE OR FALSE
Trade credit is the most common type of short-term financing for businesses.
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TRUE OR FALSE
Trade credit is the most common type of short-term financing for businesses.
true
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TRUE OR FALSE
People who own corporate bonds have loaned the company money.
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TRUE OR FALSE
People who own corporate bonds have loaned the company money.
true
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TRUE OR FALSE
High interest rates encourage borrowing by companies.
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TRUE OR FALSE
High interest rates encourage borrowing by companies.
false
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TRUE OR FALSE
Retained earnings are undistributed profits.
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TRUE OR FALSE
Retained earnings are undistributed profits.
true
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TRUE OR FALSE
Officers selected by the board of directors run the corporation.
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TRUE OR FALSE
Officers selected by the board of directors run the corporation.
true
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TRUE OR FALSE
Members of one in five American families own shares of stock.
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TRUE OR FALSE
Members of one in five American families own shares of stock.
true
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TRUE OR FALSE
Assets – Liabilities = Net Worth
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TRUE OR FALSE
Assets – Liabilities = Net Worth
true
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TRUE OR FALSE
In recent years the number of blue collar jobs has remained at the same level.
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TRUE OR FALSE
In recent years the number of blue collar jobs has remained at the same level.
false
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TRUE OR FALSE
At present, the size of the labor force in the U.S. is about half the total population.
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TRUE OR FALSE
At present, the size of the labor force in the U.S. is about half the total population.
true
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TRUE OR FALSE
In recent decades, the rate of population growth in the U.S. has been slowing down.
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TRUE OR FALSE
In recent decades, the rate of population growth in the U.S. has been slowing down.
true
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TRUE OR FALSE
The average age of the U.S. population is getting younger.
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TRUE OR FALSE
The average age of the U.S. population is getting younger.
false
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TRUE OR FALSE
Jobs in the U.S. have been shifting from the goods-producing to the service industries.
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TRUE OR FALSE
Jobs in the U.S. have been shifting from the goods-producing to the service industries.
true
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TRUE OR FALSE
The demand for workers in an industry tends to rise as the demand for the goods it produces increases.
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TRUE OR FALSE
The demand for workers in an industry tends to rise as the demand for the goods it produces increases.
true
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TRUE OR FALSE
Supply and demand are the major factors in determining wage rates.
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TRUE OR FALSE
Supply and demand are the major factors in determining wage rates.
true
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TRUE OR FALSE
The more training required for a job, the larger the supply of workers available.
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TRUE OR FALSE
The more training required for a job, the larger the supply of workers available.
false
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TRUE OR FALSE
Public goods and services cannot be easily divided and sold in small units.
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TRUE OR FALSE
Public goods and services cannot be easily divided and sold in small units.
true
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TRUE OR FALSE
One of the functions of taxes is to discourage certain behaviors.
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TRUE OR FALSE
One of the functions of taxes is to discourage certain behaviors.
true
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TRUE OR FALSE
The sales tax is an example of a proportional tax.
![Page 247: ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are limited d.can only be used once.](https://reader036.fdocuments.us/reader036/viewer/2022070410/56649eff5503460f94c14650/html5/thumbnails/247.jpg)
TRUE OR FALSE
The sales tax is an example of a proportional tax.
false
![Page 248: ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are limited d.can only be used once.](https://reader036.fdocuments.us/reader036/viewer/2022070410/56649eff5503460f94c14650/html5/thumbnails/248.jpg)
TRUE OR FALSE
The largest source of income for the federal government is the federal personal income tax.
![Page 249: ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are limited d.can only be used once.](https://reader036.fdocuments.us/reader036/viewer/2022070410/56649eff5503460f94c14650/html5/thumbnails/249.jpg)
TRUE OR FALSE
The largest source of income for the federal government is the federal personal income tax.
true
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TRUE OR FALSE
Government can encourage economic growth by promoting saving and investing.
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TRUE OR FALSE
Government can encourage economic growth by promoting saving and investing.
true
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TRUE OR FALSE
If population increases faster than GDP, the standard of living increases.
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TRUE OR FALSE
If population increases faster than GDP, the standard of living increases.
false
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TRUE OR FALSE
Debtors profit from inflation.
![Page 255: ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are limited d.can only be used once.](https://reader036.fdocuments.us/reader036/viewer/2022070410/56649eff5503460f94c14650/html5/thumbnails/255.jpg)
TRUE OR FALSE
Debtors profit from inflation.
true
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TRUE OR FALSE
Checking accounts and checking-type accounts are considered forms of money.
![Page 257: ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are limited d.can only be used once.](https://reader036.fdocuments.us/reader036/viewer/2022070410/56649eff5503460f94c14650/html5/thumbnails/257.jpg)
TRUE OR FALSE
Checking accounts and checking-type accounts are considered forms of money.
true
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TRUE OR FALSE
The value of M1 is always greater than the value of M2.
![Page 259: ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are limited d.can only be used once.](https://reader036.fdocuments.us/reader036/viewer/2022070410/56649eff5503460f94c14650/html5/thumbnails/259.jpg)
TRUE OR FALSE
The value of M1 is always greater than the value of M2.
false
![Page 260: ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are limited d.can only be used once.](https://reader036.fdocuments.us/reader036/viewer/2022070410/56649eff5503460f94c14650/html5/thumbnails/260.jpg)
TRUE OR FALSE
M2 is the most liquid definition of money.
![Page 261: ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are limited d.can only be used once.](https://reader036.fdocuments.us/reader036/viewer/2022070410/56649eff5503460f94c14650/html5/thumbnails/261.jpg)
TRUE OR FALSE
M2 is the most liquid definition of money.
false
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TRUE OR FALSE
A bank’s legal reserves are equal to its total assets.
![Page 263: ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are limited d.can only be used once.](https://reader036.fdocuments.us/reader036/viewer/2022070410/56649eff5503460f94c14650/html5/thumbnails/263.jpg)
TRUE OR FALSE
A bank’s legal reserves are equal to its total assets.
false
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TRUE OR FALSE
The nation’s money supply may increase when banks make loans.
![Page 265: ECONOMICS EXAM REVIEW. Choices are made because resources a.may run out b.have alternate uses c.are limited d.can only be used once.](https://reader036.fdocuments.us/reader036/viewer/2022070410/56649eff5503460f94c14650/html5/thumbnails/265.jpg)
TRUE OR FALSE
The nation’s money supply may increase when banks make loans.
true
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TRUE OR FALSE
If an individual bank has excess reserves, it can make loans.
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TRUE OR FALSE
If an individual bank has excess reserves, it can make loans.
true
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TRUE OR FALSE
If reserve requirements rise, the amount of money in circulation increases.
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TRUE OR FALSE
If reserve requirements rise, the amount of money in circulation increases.
false
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TRUE OR FALSE
When prices fall, the value of money rises.
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TRUE OR FALSE
When prices fall, the value of money rises.
true
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Final Review-------
What is the fundamental problem of economics?
scarcity
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Final Review-------
What are the four factors of production?
Land, labor, capital and entrepreneurship
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Final Review-------
Which of the following is an example of a good?
a.A carb.A car washc.A tune-upd.An oil change
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Final Review-------Which of the following will cause
the PPC to shift outward?a.Reduction in size of labor forceb.Increase in the quantity of laborc.Inefficiency that is correctedd.Decrease in the amount of capital
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Final Review-------
Who is considered the “father of modern economics”?
Adam Smith
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Final Review-------Which of the following best
represents payment for a service?a.$1.95 for a hamburgerb.$18.95 for a textbookc.$15,000 for a new card.$10.00 for a haircut
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Final Review-------What does having a “pure” market
economy mean?
No government involvement
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Final Review-------In what type of economy does the
government make all the basic economic decisions?
command
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Final Review-------
Private property rightsEconomic freedomProfit motiveGovernment control All of these are characteristics of
what type of economy?Capitalism
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Final Review-------
What is the most common form of business organization in the U.S.?
Sole proprietorship
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Final Review-------The owners of a corporation are
called what?
shareholders
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Final Review-------Buying only one soda instead of two
at lunchtime describes the economic concept of what?
Diminishing marginal utility
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Final Review-------
How does the demand curve respond to an increase in demand?
The demand curve shifts to the left
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Final Review-------
The demand curve will always slope___________________.
downward
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Final Review-------
What will cause a change in quantity demanded of a product?
A change in price
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Final Review-------
If prices are not allowed to reach equilibrium, what will occur?
Prolonged shortages
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Final Review-------
If there is a shortage in the market, what will likely happen to price?
Price will rise
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Final Review-------
What are the four market structures discussed in class?
Perfect competitionMonopolistic competitionOligopolyMonopoly
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Final Review-------
Which market structure would have the least control over price?
Perfectly competitive market
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Final Review-------
The refusal of workers to go to work is called what?
Strike
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Final Review-------
Training, experience, and education are all considered…….
Investment in human capital
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Final Review-------
The traditional theory of wage determination says that wages are determined by……………
Supply and demand
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Final Review-------
The profit made on the sale of stock is known as…………….
Capital gain
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Final Review-------
A taxation system where rates rise as income rises is called ……..
A progressive tax system
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THE END