Question 1

Economic progress can occur when business owners provide jobs and economic growth for their employees, their communities, and themselves.

Accepted Answer

A) True 
 B)False

Question 2

In the United States, laws prohibit the creation of most types of monopolies.

Accepted Answer

A) True 
 B)False

Question 3

If the national debt is $20 trillion, the national deficit will be considerably higher.

Accepted Answer

A) True 
 B)False

Question 4

If a shortage exists for a good in a free-market economy, the

Accepted Answer

A)   price of the good will rise.
B)   price of the good will fall.
C)   government will order suppliers to increase the production of that good.
D)   government must establish a rationing system to make sure that the good is fairly distributed.E) A) and B)
F) A) and C)

Question 5

A depression is a severe recession that is often accompanied by deflation.

Accepted Answer

A) True 
 B)False

Question 6

Just a few sellers dominate the markets for laundry detergents, soft drinks, and automobiles. Economists would classify these markets as

Accepted Answer

A)   monopolistic competition.
B)   perfect competition.
C)   oligopolies.
D)   monopolies.E) A) and D)
F) None of the above

Question 7

Peace and prosperity will flourish if we can find the one best way to divide existing resources among nations.

Accepted Answer

A) True 
 B)False  False

Question 8

Resource development is

Accepted Answer

A)   the study of how society chooses to employ resources to produce goods and services and distribute them for consumption among various competing groups and individuals.
B)   the study of how to increase the amount of available resources and create conditions that will make better use of these resources.
C)   the part of economics that looks at the operation of a nation's economy as a whole.
D)   the part of economics that looks at particular markets.E) A) and C)
F) B) and C)

Question 9

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

Accepted Answer

A) True 
 B)False  True

Question 10

One way to lessen the U.S. government budget deficit is to

Accepted Answer

A)   cut spending.
B)   increase spending.
C)   call in government savings bonds.
D)   increase government social programs such as welfare, food stamps, and Medicare.E) A) and D)
F) All of the above

Question 11

Adam Smith believed that an economic system couldn't truly prosper unless people were taught to value the welfare of others above their own personal gain.

Accepted Answer

A) True 
 B)False

Question 12

This morning on Facebook, you clicked a link to an article about the downfall of a multinational entertainment company. The report shows that despite profits plummeting 35%, the company's CEO received a 9% raise. As you read on, you learn that the company's board of directors approved undeserved salary increases. This is an example of how inequality and greed can infiltrate the free-market economic system.

Accepted Answer

A) True 
 B)False

Question 13

Aubrey is the office manager of a service company. Recently, she approved the request for new computers and office equipment for the entire office. If Aubrey's company is like most service companies, she will probably see a big jump in the productivity figures reported for workers in her office.

Accepted Answer

A) True 
 B)False

Question 14

As you're checking out the online edition of your local newspaper, you quickly scan a report in the business section that says government spending will again exceed tax revenues in the current year. What does this mean for the economy?

Accepted Answer

A)   The total national debt is likely to increase.
B)   The national deficit is likely to decrease.
C)   The rate of inflation is likely to fall.
D)   The monetary policies pursued by the Fed need tightening.E) B) and C)
F) A) and B) A

Question 15

Over dinner with his friend Nathan, Dominic complained about how prices have increased a great deal over the past year. Nathan disagreed and said that the prices of some goods have gone up a bit, but other prices have declined, noting that you can get some good buys on houses right now. Nathan feels that the average price of consumer goods hasn't changed. Nathan and Dominic can refer to the ________ to learn how government economists currently view the price situation.

Accepted Answer

A)   GDP
B)   CPI
C)   PPI
D)   MEWE) C) and D)
F) None of the above

Question 16

Which of the following statements provides the most accurate comparison of socialism and communism?

Accepted Answer

A)   Under socialism, the government owns most businesses, while under communism the church owns most businesses.
B)   Both socialism and communism strive to achieve a more equal distribution of income and wealth, but under communism, the government takes greater control.
C)   Socialism strives for an equal distribution of income but communism wants income to go primarily to those who own and operate private businesses.
D)   Communism believes that the government should always strive to balance its budget, while socialism accepts deficit spending as the price of achieving true equality.E) B) and D)
F) A) and B)

Question 17

Capitalism is the foundation of the U.S. economic system.

Accepted Answer

A) True 
 B)False

Question 18

Over the past decade, socialist economies have proven to be more successful at creating wealth and jobs than capitalist economies.

Accepted Answer

A) True 
 B)False

Question 19

Thomas Malthus believed that people in most countries would never be able to achieve high standards of living unless the problems of overpopulation were addressed.

Accepted Answer

A) True 
 B)False

Question 20

Most countries throughout the world can be classified as either purely capitalist or purely socialist.

Accepted Answer

A) True 
 B)False

Exam 2: Understanding Economics and How It Affects Business

Economic progress can occur when business owners provide jobs and economic growth for their employees, their communities, and themselves.

Correct Answer
verified

In the United States, laws prohibit the creation of most types of monopolies.

Correct Answer
verified

If the national debt is $20 trillion, the national deficit will be considerably higher.

Correct Answer
verified

If a shortage exists for a good in a free-market economy, the

Correct Answer
verified

A depression is a severe recession that is often accompanied by deflation.

Correct Answer
verified

Just a few sellers dominate the markets for laundry detergents, soft drinks, and automobiles. Economists would classify these markets as

Correct Answer
verified

Peace and prosperity will flourish if we can find the one best way to divide existing resources among nations.

Correct Answer
verified
False

Resource development is

Correct Answer
verified

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

Correct Answer
verified
True

One way to lessen the U.S. government budget deficit is to

Correct Answer
verified

Adam Smith believed that an economic system couldn't truly prosper unless people were taught to value the welfare of others above their own personal gain.

Correct Answer
verified

Correct Answer
verified

Aubrey is the office manager of a service company. Recently, she approved the request for new computers and office equipment for the entire office. If Aubrey's company is like most service companies, she will probably see a big jump in the productivity figures reported for workers in her office.

Correct Answer
verified

As you're checking out the online edition of your local newspaper, you quickly scan a report in the business section that says government spending will again exceed tax revenues in the current year. What does this mean for the economy?

Correct Answer
verified
A

Correct Answer
verified

Which of the following statements provides the most accurate comparison of socialism and communism?

Correct Answer
verified

Capitalism is the foundation of the U.S. economic system.

Correct Answer
verified

Over the past decade, socialist economies have proven to be more successful at creating wealth and jobs than capitalist economies.

Correct Answer
verified

Thomas Malthus believed that people in most countries would never be able to achieve high standards of living unless the problems of overpopulation were addressed.

Correct Answer
verified

Most countries throughout the world can be classified as either purely capitalist or purely socialist.

Correct Answer
verified

Exam 2: Understanding Economics and How It Affects Business

Economic progress can occur when business owners provide jobs and economic growth for their employees, their communities, and themselves.

Correct AnswerverifiedShow Answer

In the United States, laws prohibit the creation of most types of monopolies.

Correct AnswerverifiedShow Answer

If the national debt is $20 trillion, the national deficit will be considerably higher.

Correct AnswerverifiedShow Answer

If a shortage exists for a good in a free-market economy, the

Correct AnswerverifiedShow Answer

A depression is a severe recession that is often accompanied by deflation.

Correct AnswerverifiedShow Answer

Just a few sellers dominate the markets for laundry detergents, soft drinks, and automobiles. Economists would classify these markets as

Correct AnswerverifiedShow Answer

Peace and prosperity will flourish if we can find the one best way to divide existing resources among nations.

Correct AnswerverifiedFalse

Resource development is

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedTrue

One way to lessen the U.S. government budget deficit is to

Correct AnswerverifiedShow Answer

Adam Smith believed that an economic system couldn't truly prosper unless people were taught to value the welfare of others above their own personal gain.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Aubrey is the office manager of a service company. Recently, she approved the request for new computers and office equipment for the entire office. If Aubrey's company is like most service companies, she will probably see a big jump in the productivity figures reported for workers in her office.

Correct AnswerverifiedShow Answer

As you're checking out the online edition of your local newspaper, you quickly scan a report in the business section that says government spending will again exceed tax revenues in the current year. What does this mean for the economy?

Correct AnswerverifiedA

Correct AnswerverifiedShow Answer

Which of the following statements provides the most accurate comparison of socialism and communism?

Correct AnswerverifiedShow Answer

Capitalism is the foundation of the U.S. economic system.

Correct AnswerverifiedShow Answer

Over the past decade, socialist economies have proven to be more successful at creating wealth and jobs than capitalist economies.

Correct AnswerverifiedShow Answer

Thomas Malthus believed that people in most countries would never be able to achieve high standards of living unless the problems of overpopulation were addressed.

Correct AnswerverifiedShow Answer

Most countries throughout the world can be classified as either purely capitalist or purely socialist.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
False

Correct Answer
verified

Correct Answer
verified
True

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
A

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified