AnswersMNPS Economics FTC 25-26Cumulative Exam

Cumulative Exam — Cumulative exam Answers

25 verified answers
1
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What is the name of the period when an economy begins to shrink?

r
recession
d
depression
r
recovery
p
peak
2
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Which scenario is an example of market saturation?

A
The single coffee shop in town usually has a long line of customers and tends to stay busy during business hours.
B
There are three shoe stores on one block in town, and they have trouble finding customers and making a profit.
C
A second health club will open because the only health club in town is too crowded to accept new customers.
D
It can be difficult to get reservations at the only upscale Ethiopian restaurant in town, and it is best to call in advance.
3

What is an example of goods?

A
a hotel room
B
a good haircut
C
a car wash
D
a hard cover book
4

A tariff is a type of

t
tax.
p
punishment.
s
subsidy.
g
grant.
5

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.
6

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
7

The graph shows a point of equilibrium.If quantity demanded exceeds quantity supplied, what most likely needs to happen to achieve equilibrium?

Question illustration
T
The supply needs to increase
T
The price needs to decrease
T
The price needs to increase
T
The demand needs to increase
8

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.
9

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.
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

Why are utilities, such as electricity and water, examples of natural monopolies?

A
The cost of production restricts competition in the market.
B
There are limited natural resources to meet demand.
C
Consumers only trust known companies to provide these essentials.
D
There is no need for alternative options.
12

Adam Smith is the author of what influential book?

A
Capitalism, the Unknown Ideal
B
Conditions of the Working Class
C
The Communist Manifesto
D
The Wealth of Nations
13

What are the signs of low inflation? Check all that apply.Demand steadily rises.Demand steadily falls.Prices continue to increase.Prices continue to decrease.The economy grows in a healthy way.The economy stagnates and struggles.

D
Demand steadily rises.
D
Demand steadily falls.
P
Prices continue to increase.
P
Prices continue to decrease.
T
The economy grows in a healthy way.
T
The economy stagnates and struggles.
14

best

e
efficient
f
fast
a
accurate
p
prolific
15

A monopoly is a market that has

A
few competing businesses.
B
many sellers of the same item.
C
many sellers of a variety of products.
D
a single supplier of a good or service.
16

best

t
to reduce the number of responsibilities
t
to make it easier to raise funds for expansion
t
to move into a more favorable tax bracket.
t
to take advantage of little government oversight.
17

are debt certificates that are purchased by an investor.

Answer not available
18

In the free-enterprise system of the United States, the government

m
makes no economic decisions.
m
makes some economic decisions.
m
makes most economic decisions.
m
makes all economic decisions.
19

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
20

Which of the following is influenced by personal economic choices? Choose four answers.the cost of your rent and utilitiesthe resources you have availablethe amount of money you spend on a bus passthe money you decide to spend on leisure productsthe amount of money you put into your savings accountthe manner in which you balance your time between work and leisure

A
the cost of your rent and utilities
B
the resources you have available
C
the amount of money you spend on a bus pass
D
the money you decide to spend on leisure products
E
the amount of money you put into your savings account
F
the manner in which you balance your time between work and leisure

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