AnswersOC27 Economics-2102310-Sem-MeadowsTrade Agreements

Trade Agreements — Cumulative exam Answers

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1
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Cost-push inflation occurs when

A
consumers begin purchasing more goods.
B
producers need more money to make and distribute goods.
C
the government prints more money and pushes prices up.
D
consumers have more money to spend on goods and services.
2
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Spending that can change from year to year is known as

A
discretionary spending.
B
deficit spending.
C
mandatory spending.
D
expansionary spending.
3

Which best describes the economic impact of defaulting on bank loans?

A
The economy suffers because banks have less money to loan to others.
B
The economy suffers because people have less money to spend.
C
The economy suffers because businesses are scared to take out loans.
D
The economy suffers because people are scared to take out loans.
4

National Export InitiativeFTA Tariff ToolEuropean UnionAssociation of Southeast Asian Nations

A
National Export Initiative
B
FTA Tariff Tool
C
European Union
D
Association of Southeast Asian Nations
5

The diagram shows different types of policies.

Question illustration
T
The Best Economic Policies
G
Government Economic Policies
I
Ineffective Economic Policies
T
The Free Enterprise System
6

US federal income tax is progressive by law, but which best explains why wealthy individuals can often pay far less in taxes than the top tax rate?

H
High-income earners can fight in court for the right to a reduced rate.
H
High-income earners reduce their tax rates through numerous deductions.
H
High-income earners use tax laws to their advantage to reduce their tax rates.
H
High-income earners always place their assets overseas to lower their tax rates.
7

spendingprofitdebtsaving

A
spending
B
profit
C
debt
D
saving
8

How do consumers’ feelings about the economy help contribute to growth?

P
Positive consumer attitudes influence spending habits.
P
Positive consumer attitudes increase job prospects.
P
Positive consumer attitudes inspire increased production.
P
Positive consumer attitudes can end a depression.
9

best

b
benefits producers or consumers when taking action.
p
pushes producers or consumers to act on the government's behalf.
m
motivates producers or consumers to take action.
f
forces producers or consumers to act in a certain way.
10

What is a benefit associated with free trade?

i
increased government revenue from tariffs
e
enhanced innovation and technology
l
limited market access for domestic industries
h
higher inflation due to import competition
11

private closefactor

A
private
B
close
C
factor
12

One fact about all currency is that it

A
loses value over time.
B
has a changing value.
C
maintains a stable value.
D
grows increasingly valuable.
13

best

M
Many people could not buy new homes during a weak economy.
M
Many homes could not sell because housing prices rose too fast.
M
Many homes could not sell because banks charged high interest.
M
Many people could not make home payments during a weak economy.
14

most

M
Most countries use the dollar as their currency.
C
Countries in Asia use the euro as their currency.
D
Different countries use different currencies.
A
All countries are required to use the same currency.
15

Which best describes why governments collect taxes?

A
to control the value of currency
B
to keep the government running
C
to ensure surplus funds
D
to fund government programs
16

Which is the most liquid form of money?

A
cash and currency in circulation
B
investment accounts
C
savings accounts
D
demand accounts
17

Which group does the Fed serve?

f
financial institutions
c
consumers
g
government bodies
b
bankers
18

What are standards designed to do? Check all that apply.protect consumerssupport domestic industrieslimit importsensure safetyoffer domestic industries an advantage

p
protect consumers
s
support domestic industries
l
limit imports
e
ensure safety
o
offer domestic industries an advantage
19

How do bank loans help the nation’s economy?

T
They ensure consumer spending and confidence.
T
They ensure the success of new businesses.
T
They allow businesses to expand and improve.
T
They allow consumers to quickly pay off debts.
20

The government of Country C has passed a law protecting the physical safety of factory workers. This is an example of

m
monetary policy.
s
supply and demand.
f
fiscal policy.
r
regulatory policy.

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