AnswersTX-EconomicsGlobalization

Globalization — Cumulative exam Answers

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1
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Which best describes what happens to a corporation after its founders retire?

A
It shuts down operations.
B
It transfers to new owners.
C
It continues in business.
D
It sells out to shareholders.
2
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If Country A is an agricultural country and Country B has many cities and factories, it would make sense for

A
both countries to set up car manufacturing plants.
B
Country A to specialize in growing corn while Country B specializes in making cars.
C
Country A to specialize in making cars while Country B specializes in growing corn.
D
both countries to compete in growing more corn.
3

Sebastian and Mia want to buy a home valued at $250,000. The property tax for this location is 1%. Based on the current value of the home, what would their property tax be?

A
$25
B
$250
C
$2,500
D
$25,000
4

A certificate of deposit pays a higher interest rate than a savings account because the money is

A
guaranteed by the government.
B
kept by banks for a longer time period.
C
loaned to banks by consumers.
D
immediately available to consumers.
5

Banks that offer low interest rates to people with good credit

A
maximize profits at little risk.
B
sacrifice profits for less risk.
C
maximize profits at great risk.
D
sacrifice profits for more risk.
6

Public property is land or goods

A
owned by an individual.
B
owned by the government.
C
used for private businesses.
D
used to gain personal wealth.
7

Which best describes how advertising influences consumer choice in an oligopoly?

A
Advertising coaxes people to buy new products.
B
Advertising alerts consumers to price reductions.
C
Advertising undermines competition.
D
Advertising informs brand knowledge.
8

Angela is considering buying stock in a popular computer software company whose price has dropped significantly in the last year. Why might this be a wise move for Angela to make?

A
because it is smart to buy when prices are high and sell when prices are low
B
because it is smart to buy when prices are low and sell when prices are high
C
because her investment will be guaranteed by the government if the company fails
D
because the company will rebound because she likes to use the products they sell
9

Which of these is not a main advantage for a business joining a cooperative?

A
Lower costs for purchasing supplies
B
Pooling products for better selling prices
C
Sharing costs for needed services
D
Having a larger vote than smaller companies
10

Which are affected by the factors of production? Choose three answers.

A
the demand of the item
B
the availability of the item
C
the cost of the item
D
the quality of the item
E
the popularity of the item
11

When the government injects money into the economy, consumers may have more disposable income, which may lead to

A
higher unemployment.
B
higher production.
C
lower production.
D
increases in taxes.
12

Which situation is an example of comparative advantage in an international market?

A
Country A decides to grow extra potatoes so they have more to export, while Country B does not grow potatoes to export.
B
Factories in Country A and Country B produce the same number of tablet computers. Country A’s factories could be used instead to build more laptops than the factories in Country B.
C
Country A invests in a new technology while Country B chooses to invest in education.
D
Country A can produce 100 units of rice per acre of farmland, while Country B can only produce 70 units of rice per acre of farmland using the same resources.
13

Why do most nations use fiat money today?

A
Governments are able to exert control over the value of fiat money.
B
Fiat money is stable and will not lose value during economic downturns.
C
Fiat money will maintain its value despite fluctuating exchange rates.
D
Governments know that fiat money derives its value from gold and silver.
14

Most often, an insurance deductible must be fulfilled

A
when sharing the cost of a payout.
B
before insurance payouts begin.
C
when signing up for an insurance plan.
D
after a company has paid a claim.
15

Jacob is considering buying a new car. Which nonrenewable resource should influence the decision?

A
labor
B
water
C
minerals
D
petroleum
16

Which best describes why governments enact tariffs?

A
to reduce the price of domestic products
B
to discourage consumers from purchasing foreign goods
C
to limit the sale of foreign goods
D
to ensure that domestic producers make a profit
17

The Fed may respond to a recession by

A
discouraging consumer borrowing.
B
decreasing interest rates.
C
decreasing government spending.
D
decreasing available credit.
18

In a competitive market, a computer store offers customers a warranty to help pay for any future damages. This is an example of

A
following a federal regulation.
B
lowering prices for customers.
C
reducing the risk for consumers.
D
creating a new or better product.
19

Which organization created a shared economy?

A
European Union
B
World Trade Organization
C
North American Free Trade Agreements
D
Association of Southeast Asian Nations
20

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.

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