Answers FL-2102310-EconomicsCumulative Exam

Cumulative Exam — Cumulative exam Answers

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The graph shows a point of equilibrium.What is the price at which equilibrium is achieved?

$10

$30

Emma is trying to decide whether to buy a new laptop. As a student, she has a budget and wants to make sure this is the right financial decision. Which question should she ask herself in determining the opportunity cost of this purchase?

What will I have to sacrifice if I buy this laptop?

Can I use credit to buy this laptop?

Do I need this laptop for my studies?

Is there a less costly alternative to buying this laptop?

Which best describes why governments enact tariffs?

to reduce the price of domestic products

to discourage consumers from purchasing foreign goods

to limit the sale of foreign goods

to ensure that domestic producers make a profit

An extended recessionary period is indicative of

a depression.

the start of a recovery.

a growing economy.

the end of a recession.

People who oppose labor unions believe that unions

keep more qualified workers from being hired.

create more new jobs than workers can fill.

make many businesses more competitive.

encourage employers to reduce salaries.

Look at the following chart.

analyzing the climate to see which fruit would grow better.

studying the profitability of growing apples versus oranges.

researching what competitors are doing.

choosing to grow both fruit varieties or only apples.

In which situation would a savings account be the best investment to earn interest?

when you need to make frequent payments for bills

when you have to pay monthly installments for a loan

when you need immediate access to cash

when you want to buy a new car in 3 years

Which type of credit is most likely to be unsecured?

auto loans

credit cards

mortgage loans

personal loans

Which best describes an opportunity cost?

accepting an opportunity to do something else when making an economic decision

giving up an opportunity to do something else when making an economic decision

accepting an opportunity to help accomplish something else when making an economic decision

giving up an opportunity to increase prices when making an economic decision

Compound interest is usually better than simple interest because it pays

interest on the principal and the interest earned in each period.

interest on the entire principal rather than the interest in each period.

more, as it is matched by an employer’s 401k contribution.

more often throughout the year rather than once a year.

Corporate taxes are a type of

income tax.

property tax.

sales tax.

excise tax.

What is one reason why the government would provide financial assistance to an entrepreneur?

to decrease the high rate of failure of new businesses

to encourage the invention and development of products

to stimulate the economy while decreasing unemployment

to limit the amount of personal funds used to start the business

Economists use changes in GDP to measure

the balance of trade with other countries.

any economic growth or shrinkage.

the causes of unemployment.

the distances between cities.

When entrepreneurs develop new products, other companies also experience growth because they

immediately copy the successful product.

create many companion products.

try to develop their own products.

attempt to improve the product.

If it becomes less expensive to travel overseas from the United States, American tourists will benefit from the fact that

tourist sites are getting crowded and dirty.

the US dollar has become stronger.

prices of foreign goods are rising.

the US dollar has declined in value.

Which financial tool is most important when planning for your future financial goals?

Enrolling in a high interest savings account

Creating a budget

Mortgaging a house

Taking on extra debt

The graph shows the market for graphic T-shirts.

As the amount of a product goes up, the price goes up.

As the amount of a product goes down, the price goes up.

As the interest in a product goes up, the price goes up.

As the interest in a product goes down, the price goes up.

Demand-pull inflation occurs when

the price of goods rises suddenly and extremely fast.

consumers begin purchasing more goods.

producers need more money to make and distribute goods.

the government prints more money and pushes prices up.

When it spends money on education, a government is trying to

find a way to meet a social need.

encourage immediate economic growth.

meet a social need and improve the economy.

find a way to spend budget surpluses.

The Fed may respond to a recession by

discouraging consumer borrowing.

decreasing interest rates.

decreasing government spending.

decreasing available credit.

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