RomasEcon.weebly.com - Unit 1



Economics Practice Test #11.?Which of the following people is making a decision based on opportunity cost? A. Donald tries to drive less often because the price of gas has become more expensive. B. Ralph does not fix his broken fence because he wants to spend his money on a new TV. C. Leonard places his money in a savings account so that he will be able to use it in the future. D. Michael decides to buy two cinnamon rolls because he will receive the third roll for free. Write your response here: 2.???outsourcing??off-shoring??supply-chainingThe practices listed above are most related to the expansion of A. state economies. B. the global economy. C. the national economy. D. household economies. Write your response here: 3.?Which term describes a budget in which expenditures exceed revenue? A. balanced budget B. budget deficit C. budget surplus D. national budget Write your response here: 4.?Which of these describes an economic incentive for entrepreneurs? A. An entrepreneur has an easier time participating in the global market. B. An entrepreneur does not have to worry about as much economic risk. C. An entrepreneur does not have to share any profits with an employer. D. An entrepreneur has a greater opportunity to share the costs of product. Write your response here: 5.?Which economic indicator accounts for inflation and deflation by comparing average price changes to the prices of a chosen base year? A. consumer price index B. unemployment rate C. GDP D. per capita GDP Write your response here: 6.?How does a corporate monopoly impact economic activity? A. A monopoly helps create new markets. B. A monopoly helps reduce unemployment. C. A monopoly increases the amount of production. D. A monopoly decreases the amount of competition. Write your response here: 7.?Which word fits best in the empty box? A. Purchases B. Equilibrium C. Governments D. Income taxes Write your response here: 8.?What is the main purpose of the above government organizations? A. They operate as businesses that offer services. B. They raise revenue for the government. C. They maintain the stability of the economy. D. They protect the safety of consumers. Write your response here: 9.??????????court facilities?????????public schools?????????emergency management?????????parks and recreationHow are the above services primarily funded? A. federal revenue from loans B. federal aid from state governments C. government aid from volunteers D. government revenue from taxation Write your response here: 10.?Sylvia has started a training program for her employees. She hopes to educate them on workplace procedures and methods. Sylvia is investing in which type of capital? A. mental capital B. mutual capital C. human capital D. physical capital Write your response here: 11.?In recent years, Russia and other countries have been moving from a command economy to a market economy. A country moving from a command economy to a market economy will most likely A. establish a new political system. B. establish a new monetary system. C. increase government control of business. D. reduce government control of business. Write your response here: 12.?A popular new video game is released in limited supply. How will the limited supply most likely impact sales of the video game? A. It will decrease the price of the video game. B. People will manufacture their own video games. C. People will lose interest in the video game. D. It will increase the price of the video game. Write your response here: ?GDP per CapitaLife Expectancy(years)LiteracyU.S.A.46,0007899%Japan33,8008299%Somalia6004938%South Korea24,6007798%Romania11,1007297%Honduras3,3006980%13.?What does this chart indicate about the relationship among GDP per capita, life expectancy, and literacy? A. Nations' life expectancies and literacy rates are unrelated to their GDP per capita. B. Nations with the lowest GDP per capita have the lowest life expectancy and literacy rates. C. Nations with the highest GDP per capita always have the highest life expectancy. D. Nations with a medium GDP per capita have the highest life expectancy and literacy rates. Write your response here: Use the chart and your knowledge of social studies to answer the following question.East Asian CountriesCountryPopulation Density (per square mile)Workforce in Agriculture and ForestryPer Capita IncomeEconomic SystemPeople's Republic of China32760%$2,500CommandNorth Korea50436%$920CommandSouth Korea1,18521%$11,270Free enterpriseJapan8607%$20,200Free enterpriseMongolia436%$1,800CommandRepublic of China (Taiwan)1,53716%$12,070Free enterprise14.?Based on the data provided in the chart, what conclusion can be made about the countries of East Asia? A. The countries with free-enterprise economic systems have the highest per capita income. B. Free-enterprise countries have the lowest population density. C. Command-economy countries have the lowest percent of their workforces in agriculture and forestry. D. The countries with the largest percent of their workforce in agriculture and forestry have the highest per capita income. Write your response here: 15.?Which action from the U.S. government would most encourage consumers to spend money in the free market? A. lowering the amount of personal income tax B. raising the amount of foreign tariffs C. motivating businesses to raise their prices D. providing more government services Write your response here: 16.?What is the primary difference between a credit card and a debit card? A. Both cards can be used to make payments, but a credit card is able to hold more money. B. A credit card can be paid for as it is used, while a debit card must be paid for before it is used. C. Both cards can be used to make payments, but a debit card can be used in different countries. D. A credit card lets the buyer pay later, while a debit card pays directly from the buyer's account. Write your response here: 17.?Which term is used to describe a situation where most consumers are forced to make decisions based on limited resources? A. inflation B. need C. scarcity D. want Write your response here: 18.?How would an increase in total expenditures affect the nation's economy? A. It would cause an expansion. B. It would cause a trade surplus. C. It would cause stagnation. D. It would cause a recession. Write your response here: 19.?Different countries often specialize in producing different goods. What is a consequence of this? A. The countries are less likely to experience economic growth. B. The countries are more likely to trade with each other. C. The countries are less likely to meet their citizens' needs. D. The countries are more likely to have hostile relations. Write your response here: 20.? Intelligent economic decision-making involves marginal analysis, whereby one… A. Makes decisions that provide the greatest benefit at the lowest opportunity cost. B. Makes decisions that provide the greatest benefit at the maximum opportunity cost. C. Makes decisions that have no opportunity cost. D. Attempts to maximize effort in order to maximize results. Write your response here: 21.?Which of these would most likely increase the level of unemployment? A. an economic expansion B. a stabilized economy C. a strong domestic market D. an economic recession Write your response here: 22.?Which of these is a macroeconomic goal that economic systems try to achieve? A. low unemployment B. economic stagnation C. economic dependency D. high prices Write your response here: 23.?Excellent weather helps wheat farmers yield a record surplus crop. How will the surplus most likely impact the price of wheat? A. The price of wheat will decline. B. The price of wheat will increase. C. The demand for wheat will increase. D. The demand for wheat will decline. Write your response here: 24.?The Federal Reserve Board implements a tight monetary policy. What is the likely impact of this policy on consumers? A. Consumers will spend more and save less. B. Consumers will save more and spend more. C. Consumers will save more and spend less. D. Consumers will save less and spend less. Write your response here: 25.?A nation is said to have a comparative advantage when it is able to A. make a profit from selling a product to a specific market. B. produce a product at a lower price than other nations. C. manufacture a product in larger quantities than it expected. D. sell its product from multiple stores throughout the world. Write your response here: 26.?Which of the following trade policies would most encourage Americans to buy domestic products instead of foreign products? A. specialization B. trade agreements C. tariffs D. import subsidies Write your response here: 27.?Which government agency is responsible for collecting taxes and educating taxpayers about their responsibilities? A. Social Security Administration B. Internal Revenue Service C. United States Census Bureau D. Federal Bureau of Investigation Write your response here: 28.?IRAs and 401K plans both involve A. disability benefits. B. ownership of a corporation. C. government agencies. D. investing for retirement. Write your response here: 29.?Buying health insurance is an example of A. risk transfer. B. risk reduction. C. risk retention. D. risk avoidance. Write your response here: 30.?Which of the following businesses or industries would be most affected by strict clean air laws? A. a shopping mall B. an ad agency C. a logging company D. an oil refinery Write your response here: ................
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