AnswersFL-2106310-United States GovernmentPrescriptive Test

Prescriptive Test — Cumulative exam Answers

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61
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An extended recessionary period is indicative of

A
a depression.
B
the start of a recovery.
C
a growing economy.
D
the end of a recession.
62
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What is an example of a country that makes use of another nation’s currency?

A
France
B
Germany
C
Panama
D
Mexico
63

The chart shows the marginal cost of producing apple pies.This chart demonstrates that the marginal cost

Question illustration
A
initially decreases as production increases.
B
initially increases as production increases.
C
eventually decreases as production increases.
D
eventually increases as production decreases.
64

According to the law of demand, as prices decrease, the quantity demanded

A
decreases.
B
increases.
C
stays the same.
D
disappears.
65

Though it is seen as a last resort, bankruptcy allows a consumer to

A
temporarily stop paying debts.
B
eliminate certain types of debt.
C
easily reestablish good credit.
D
receive credit in an emergency.
66

Read this news report about a planned devaluation of the bolivar, the currency of Venezuela.The president of Venezuela announced that the country would be devaluating the bolivar for the fifth time in nine years. The official rate is falling from 4.3 bolivars to the dollar, to 6.3, a 32% devaluation. By increasing the bolivar value of exports of oil to the US and other nations, the government hopes to alleviate a budget crisis caused by its increasing reliance on borrowing to meet spending obligations.In response to the announcement, the people of Venezuela lined up today to buy televisions, electronics, and airline tickets in order to protect themselves from projected price increases.

A
followed the law of supply and demand.
B
allowed the exchange rate to remain unchanged.
C
increased the number of bolivars needed to buy one dollar.
D
decreased the number of bolivars needed to buy one dollar.
67

An annual percentage rate, or APR, represents how much

A
interest is paid over a year.
B
interest is paid over many years.
C
principal is paid over a year
D
principal is paid over many years.
68

Which best explains how contractionary policies can hamper economic growth?

A
They increase consumer demand.
B
They can increase inflation.
C
They reduce taxes which raises deficits.
D
They reduce disposable income.
69

Economists use changes in GDP to measure

A
the balance of trade with other countries.
B
any economic growth or shrinkage.
C
the causes of unemployment.
D
the distances between cities.
70

Which of these is a banking activity of the Fed?

p
printing money
r
regulating securities markets
s
storing money for banks
f
funding government programs
71

The graph shows demand.In order to achieve equilibrium, what else must be included on the graph?

Question illustration
d
disequilibrium
s
supply curve
e
excess supply
e
excess demand
72

Which statement describes how borrowers will most likely benefit when the Fed reduces reserve requirements?

A
Loan requirements will likely be relaxed.
B
Interest rates will likely decrease.
C
Housing prices will likely decrease.
D
Investment opportunities will likely improve.
73

What do the indicators used by economists reveal?

A
changes in production and demand
B
changes in employment levels
C
changes in prices
D
changes in the health of an economy
74

If expansionary taxation policies encourage growth, are they always appropriate to implement?

N
No, government services could encourage growth but other practices could be more effective based on the economic situation.
Y
Yes, the private sector can easily and affordably replace all services and facilities cut by the government.
N
No, the government is capable of providing many but not all services individuals and businesses need.
Y
Yes, the government will still ensure that individuals and businesses continue to receive all necessary services.
75

Which occurs during market equilibrium? Select two options.Supply and demand meet at a specific price.Supply is slightly greater than demand.Supply and demand meet at a specific quantity.Supply and demand meet at a demand point.Supply and demand meet at a supply point.

A
Supply and demand meet at a specific price.
B
Supply is slightly greater than demand.
C
Supply and demand meet at a specific quantity.
D
Supply and demand meet at a demand point.
E
Supply and demand meet at a supply point.
76

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

A
to decrease the high rate of failure of new businesses
B
to encourage the invention and development of products
C
to stimulate the economy while decreasing unemployment
D
to limit the amount of personal funds used to start the business
77

John Maynard Keynes developed new economic theories in response to the

A
stock market crash of 1929.
B
Great Depression of the 1930s.
C
first and second world wars.
D
economic boom of the 1950s.
78

Consumer demand is defined as

A
how frequently the prices change.
B
the willingness and ability people have to buy a good. ✓ Correct
C
how frequently the people are willing pay for something.
D
how often people want something delivered.
79

What is a way victims of identity theft in Florida can track activity on their credit report?

A
by giving lenders permission to access credit history
B
by canceling all of their credit and bank cards
C
by contacting their lenders on a daily basis
D
by placing a security freeze on their reports
80

The graph shows a point of equilibrium.If the quantity supplied is greater than the quantity demanded, what must happen to the price in order to reach equilibrium?

Question illustration
A
The price of the product will increase to meet equilibrium.
B
The price of the product will decrease to meet equilibrium.
C
Supply and demand must be raised.
D
Supply and demand must be lowered.

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