AnswersOC27 Economics-2102310-Sem-MeadowsUnit Test

Unit Test — Cumulative exam Answers

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41
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Credit unions differ from retail banks because they are

A
owned by their members.
B
owned by their employees.
C
owned and managed by private corporations.
D
owned by shareholders who purchased stock.
42
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Which statements correctly explain price floors and price ceilings? Choose four answers.Ineffective price floors tend to be too high.Ineffective price ceilings tend to be too low.Price floors help producers by raising prices.Price ceilings help consumers by lowering prices.Effective price floors are set above equilibrium.Effective price ceilings are set below equilibrium.

I
Ineffective price floors tend to be too high.
I
Ineffective price ceilings tend to be too low.
P
Price floors help producers by raising prices.
P
Price ceilings help consumers by lowering prices.
E
Effective price floors are set above equilibrium.
E
Effective price ceilings are set below equilibrium.
43

What term is used in macroeconomics to describe the total supply and the total demand?

A
capital
B
inflation
C
aggregate
D
equilibrium
44

A tariff is a type of

A
tax.
B
punishment.
C
subsidy.
D
grant.
45

When the economy grows, the market grows, most likely because

A
more investors are willing to take risks.
B
the government has decreased spending.
C
the government has increased taxation.
D
investors have a greater desire for profits.
46

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?

A
High-income earners can fight in court for the right to a reduced rate.
B
High-income earners reduce their tax rates through numerous deductions.
C
High-income earners use tax laws to their advantage to reduce their tax rates.
D
High-income earners always place their assets overseas to lower their tax rates.
47

Which of the following would be considered a nonrenewable resource?

s
sun
w
wind
l
lumber
p
petroleum
48

What is one way employers get employees to participate in a 401k?

A
by requiring them to participate unless they opt out
B
by requiring them to opt in if they want to participate
C
by giving them an annual pay raise
D
by giving them a signing bonus when they participate
49

These lists outline the details of two jobs.

Question illustration
A
family needs
B
job location
C
personal life
D
annual wages
50

What is the difference between inflation and deflation?

I
Inflation can result from falling demand and boosts the value of money. Deflation can result from rising demand and reduces the value of money.
I
Inflation can result from rising demand and boosts the value of money. Deflation can result from falling demand and reduces the value of money.
I
Inflation can result from falling demand and reduces the value of money. Deflation can result from rising demand and boosts the value of money.
I
Inflation can result from rising demand and reduces the value of money. Deflation can result from falling demand and boosts the value of money.
51

Money for a personal loan is usually issued to the borrower

A
as needed over time.
B
in small sums.
C
in one lump sum.
D
without collateral.
52

Why does an increase in literacy rates often accompany an increase in per capita income?

A
People who have higher-paying jobs often have the time available to develop literacy skills.
B
Developing countries have higher-than-average literacy rates, which typically leads to higher income.
C
People who can read and who receive an education are eligible for higher-paying jobs.
D
Developed countries often attempt to raise low literacy rates to improve income.
53

This table shows the number of employees needed to fill lunch orders at several food trucks.Food Truck Number of Lunch Orders Number of Employees Frank’s Falafels 20 per hour 2 Kimchi Kim’s 25 per hour 3 Deli Delight 30 per hour 3 Lunch on the Go 25 per hour 2 Which food truck has the absolute advantage?

A
Frank’s Falafels
B
Kimchi Kim’s
C
Deli Delight
D
Lunch on the Go
54

A possible result of disequilibrium is

e
excess demand.
l
lower demand.
f
fixed prices.
s
stable availability.
55

To be successful, what must an entrepreneur be willing to invest? Check all that apply.moneyunemploymentpersonal safetytimeconsiderable effort

A
money
B
unemployment
C
personal safety
D
time
E
considerable effort
56

Which of these statements most accurately describes the use of currencies in different parts of the world?

A
Most countries use the dollar as their currency.
B
Countries in Asia use the euro as their currency.
C
Different countries use different currencies.
D
All countries are required to use the same currency.
57

In a republic, elected officials create laws to regulate the economy.

T
T
F
F
58

Which body manages the Fed?

A
the Appropriations Committee
B
the Federal Reserve Board
C
the Federal Open Markets Committee
D
the Economic Policy Subcommittee
59

If a borrower provides collateral and fails to repay the loan,

A
the borrower may cancel the loan to get the collateral.
B
the lender can sell the collateral to cover losses.
C
the borrower must buy the collateral back.
D
the lender keeps the collateral in case of late payment.
60

Which is the best question for Joe to ask himself when deciding whether to open a checking or savings account?

A
Is there an ATM near my home or work?
B
Does the bank offer free checking?
C
If I need a loan, will they give it to me?
D
Why am I opening a bank account?

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