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Principles of Financial Planning Answers

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As of 2013, which of these countries had the highest GDP per capita?

Uganda

the United States

Switzerland

Brazil

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How does specialization enable countries to trade with one another?

A country can make and sell goods affordably and buy goods that it is inefficient at making.

A country can make what it chooses and sell its goods to other countries.

A country can decide to buy everything it needs from other countries.

A country can efficiently make goods that were once difficult to make.

Which of these statements most accurately describes currencies in North America?

All countries in North America use the US dollar.

All countries in North America use the euro.

North American countries have done away with separate currencies.

Each country in North America uses its own currency.

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.

rising inflation.

price deflation.

declining inflation.

increased imports.

Read the sentence from an informative essay about globalization in China.As urban populations continue to grow, so do the number of citizens who burn coal for fuel.Which detail would provide factual support for this sentence?

data about pollution caused by motorized vehicles

data about China’s economy in the global marketplace

data about population growth in China’s largest city

data about the kinds of pollution caused by burning coal

How might foreign investment be problematic for a transitioning economy?

Foreign investment can temporarily slow economic growth.

It may be difficult to adjust to another nation’s influence.

A foreign government may seize control of the country.

The transitioning economy must adopt a foreign currency.

Tariffs and subsidies are both examples of

monetary restrictions for the domestic producer.

economic benefits for the consumer.

economic benefits for the international producer.

incentives—one positive and one negative.

Which technologies have made global communication instant and more effective? Choose three answers.social mediawireless devicessmart phonesautomobilesprinted newspapers

social media

wireless devices

smart phones

automobiles

printed newspapers

One primary purpose of the European Union is to

create a common market.

eliminate borders between countries.

allow highly skilled workers to be employed.

limit trade among member countries.

Which of these statements most accurately describes currencies in North America?

All countries in North America use the US dollar.

All countries in North America use the euro.

North American countries have done away with separate currencies.

Each country in North America uses its own currency.

Technologies that allow for instant worldwide communication include

high-speed trains and naval ships.

mobile phones and Internet access.

airplanes and container shipping.

outsourcing and new trade markets.

most likely

Free trade helps every nation.

Free trade has drawbacks for participants.

Free trade will eliminate poverty.

Free trade must be carefully monitored.

The Middle East is best associated with which internationally traded product?

electronics

bananas

manufactured goods

oil

Why do countries provide financial incentives?

Financial incentives act as trade barriers.

Financial incentives limit imports.

Financial incentives set standards.

Financial incentives restrict all trade.

It takes brothers John and Dan the same amount of time to clean the room they share, but John can mow the lawn faster than Dan. Which action would allow them to take advantage of their respective comparative advantages?

them both sharing each task equally

John mowing the lawn and Dan cleaning their room

Dan mowing the lawn and John cleaning their room

Dan doing both tasks

What is the benefit in reaching the absolute advantage in the production of one good?

to produce more units of a good than other countries

to produce fewer units of a good than other countries

to produce more units of a good while using fewer resources

to produce fewer units of a good while using fewer resources

The images show the cost of the same bike in the United States and Britain.

purchasing power parity.

exchange rates.

factors of production.

gross domestic product.

What is an example of a country that makes use of another nation’s currency?

France

Germany

Panama

Mexico

If investors can earn 10 percent interest in an account in Mexico but just 3 percent in the United States, those investors will most likely

continue to invest in the United States and have no effect on the exchange rate.

want to invest in Mexico and cause the exchange rate to rise.

try to do anything possible to keep the exchange rate from changing.

want to invest in Mexico, which will cause the peso to appreciate.

In regard to trade, the United States

imports goods and services only.

exports goods and services only.

does not import or export goods and services.

imports and exports goods and services.

Which trade organization is responsible for 90% of the world’s trade?

the EU

ASEAN

the WTO

NAFTA

What is one stated purpose of the World Trade Organization?

to create a common currency

to encourage the expansion of exports

to monitor trade policies of many countries

to establish direct trade agreements between countries

When revising an informative essay, it is important to consider

the topic and language.

the topic and narrative.

the argument and language.

the outline and language.

A specific territory or zone that has laws and regulations different from the rest of the country is called a(n)

work zone.

border zone.

tax-free zone.

economic zone.

What is one reason two countries may sign a treaty to create a direct agreement with one another?

to establish barriers to trade

to cut taxes

to collect more taxes

to limit trade opportunities for competing companies

There would be no separation between one country’s economy and another’s if the entire world

shared the same currency.

chose paper currency over coins.

eliminated denominations for currency.

agreed to use only two types of currency.

"technology"

Answer:

33190

Tariffs and subsidies are both examples of

monetary restrictions for the domestic producer.

economic benefits for the consumer.

economic benefits for the international producer.

incentives—one positive and one negative.

A country that has multinational corporations is most likely to be

a developed economy.

a transitioning economy.

a developing economy.

a control economy.

Which is the best example of a country that is dependent on other countries?

a country that has little fertile soil

a country that has no imports

a country with grain surpluses

a country with a diverse economy

What is the purpose of quotas?

to ban all imports from a country

to ensure specific goods are not available to consumers

to limit how much of a good can be imported

to keep prices on domestic goods low

Countries establish internal economic zones in order to

limit foreign investment.

make solving disputes easier.

have fewer economic restrictions.

create manageable amounts of imports.

Why do most countries both export and import goods?

to eliminate competition from other economies

to decrease the production of goods domestically

to rely entirely on foreign economies

to get a good mix of goods and services

What does the International Monetary Fund (IMF) seek to accomplish for developing countries?

The IMF establishes industries and technologies in developing countries.

The IMF helps a developing country’s citizens establish bank accounts.

The IMF gives college aid to qualified individuals in developing countries.

The IMF provides economic advice and loans to developing countries.

What is the first step to creating an informative essay?

editing

prewriting

drafting

sequencing

Read the sentence from an informative essay about globalization in China.Pollution levels in Beijing are improving in some ways thanks to government programs.The sentence needs to be revised because it lacks detail and factual support about

government programs.

global pollution levels.

globalization in China.

pollution levels in China.

The Czech Republic’s decision in 2003 to join the European Union indicated that the Czech Republic

was now equal in wealth to all other European nations.

would give all economic control to the European Union.

was willing to forge economic ties with other nations.

would eventually achieve a mixed-market economy.

How do trade agreements of international organizations affect trade?

by incentivizing the development of trade policies

by eliminating tariffs and taxes on imports and exports

by encouraging countries to provide open access to trade

by helping smaller countries compete in the world market

Read this excerpt describing the mission of the World Bank.The World Bank is a vital source of financial and technical assistance to developing countries around the world. It is not a bank in the common sense. Instead, it plays a different but supportive role in its mission of global poverty reduction and the improvement of living standards.It provides low-interest loans, interest-free credit, and grants to developing countries for education, health, infrastructure, communications, and many other purposes.

The World Bank is a source of financial assistance.

The World Bank aims to improve living standards.

The World Bank provides low-interest loans and credit.

The World Bank serves people of different income levels.

followed the law of supply and demand.

allowed the exchange rate to remain unchanged.

increased the number of bolivars needed to buy one dollar.

decreased the number of bolivars needed to buy one dollar.

The United States is said to have an absolute advantage in producing food compared with Japan. What does that mean?

It must import most of its food from Japan.

It produces food more efficiently than Japan.

It produces food at a higher cost than Japan.

It must export most of its food to Japan.

How are subsidies similar to tariffs?

Both are types of taxes.

Both aim to lower the price of domestic goods.

Both are types of tax breaks and financial assistance.

Both allow domestic goods to compete against foreign goods.

How can a nation benefit from effectively exporting its goods?

Its citizens can buy cheaper goods.

Its businesses can invest in the future.

Its domestic spending increases.

Its citizens have more money.

An introduction to an informative essay about globalization in China should include

a brief background about globalization.

a few sources related to globalization.

main subtopics related to globalization.

supporting evidence about globalization.

When a country chooses to limit the kinds of goods or services it produces, it is practicing

absolute advantage.

globalization.

dependency.

specialization.

One factor that indicates a developed economy's standard of living is its

growth in outsourcing rates.

strong social connections.

high levels of education.

low GDP per capita.

Which statement best describes how globalization is affecting the world?

Globalization is growing less important as time passes.

The world is becoming more globalized and connected.

Globalization has resulted in fewer connections among countries.

Countries are growing less likely to trade with one another.

What do quotas and embargoes have in common?

They both tend to raise prices.

They both affect imports from certain countries.

They both set limits on imported goods.

They both frequently result in domestic shortages.

A currency shared by several countries in Europe is the.

Answer not available

The graph below shows the value of the US dollar versus the Canadian dollar.

rising against the Canadian dollar.

falling against the Canadian dollar.

more than twice that of the Canadian dollar.

about half that of the Canadian dollar.

What steps must countries take to transition to a mixed-market economy? Check all that apply.They must establish state-owned businesses.They must decrease private ownership.They must establish a fair labor market.They must discourage foreign investment.They must open up trade to other countries.

They must establish state-owned businesses.

They must decrease private ownership.

They must establish a fair labor market.

They must discourage foreign investment.

They must open up trade to other countries.

The chart shows a circular flow model describing the movement of goods and services.

The foreign sector influences how services move between firms and households.

The foreign sector influences how imports and exports move between firms and households.

The foreign sector influences how factors of production move between firms and households.

The foreign sector influences how goods move between firms and households.

Which situation is the best example of opportunity cost?

A country chooses to produce bananas instead of wheat.

A country chooses to invest in manufacturing and agriculture.

A country chooses to specialize in producing paper products.

A country chooses to export all of its products.

"Development"

Answer:

33363

How have airplanes changed the way the world does business? Choose four answers.by shipping raw materials to manufacture goods in other countriesby shortening travel timeby opening up new trade markets worldwideby connecting business partners the fastestby increasing options for travel destinations

by shipping raw materials to manufacture goods in other countries

by shortening travel time

by opening up new trade markets worldwide

by connecting business partners the fastest

by increasing options for travel destinations

Which statement accurately describes a developing country?

The country's population has a high growth rate.

The country has a high standard of living.

The country's population has a high life expectancy.

The country has a high GDP per capita.

When a country chooses to limit the kinds of goods or services it produces, it is practicing

absolute advantage.

globalization.

dependency.

specialization.

How has globalization made countries more interdependent? Choose five answers.Countries now rely on one another for vital resources.Countries now rely on each other for new industries.Countries now rely on one another for chances to import and export.Countries now rely on one another to lower their GDP.Countries rely on each other for cheaper products.Countries now rely on one another for an employment base.

Countries now rely on one another for vital resources.

Countries now rely on each other for new industries.

Countries now rely on one another for chances to import and export.

Countries now rely on one another to lower their GDP.

Countries rely on each other for cheaper products.

Countries now rely on one another for an employment base.

Which best describes what a subsidy does?

It keeps the price of domestic goods relatively low.

It raises the price of imported goods.

It encourages the import of foreign goods.

It eliminates all taxes on domestic goods.

What is the most common reason why countries create trade agreements?

to limit imports

to create free trade

to establish quotas

to decrease trade

The chart below shows an exchange rate table.

US dollar.

Swiss franc.

Japanese yen.

euro.

What characterizes developing economies? Check all that apply.a growing industrial economya low level of reliance on natural resourcesa drop in the standard of livinga focus on agricultural activitya shrinking middle class

a growing industrial economy

a low level of reliance on natural resources

a drop in the standard of living

a focus on agricultural activity

a shrinking middle class

Often duties and taxes are imposed on cars that are imported from other countries. What types of incentives are these duties and taxes?

positive incentive and subsidy.

negative incentive and subsidy.

positive incentive and tariff.

negative incentive and tariff.

What can be a result of free trade? Check all that apply.trade imbalancesdecreased productionlower economic growthincreased pollutionexploitation of workersnew opportunities

trade imbalances

decreased production

lower economic growth

increased pollution

exploitation of workers

new opportunities

Which type of incentive makes it more profitable to follow a certain course of action?

Answer not available

As of 2013, which of these countries had the highest GDP per capita?

Uganda

the United States

Switzerland

Brazil

On which country has the United States imposed an embargo since 1960?

Cuba

Iran

North Korea

Syria

What is one reason two countries may sign a treaty to create a direct agreement with one another?

to establish barriers to trade

to cut taxes

to collect more taxes

to limit trade opportunities for competing companies

In a transitioning economy, what is a downside of rapid economic growth?

Rapid economic growth can be difficult to regulate.

Rapid economic growth benefits only the wealthy.

Rapid economic growth usually leads to a crash.

Rapid economic growth may stifle cultural growth.

Which is an example of a country that is overly dependent on another country for critical goods and services?

a country that imports all its oil

a country that imports all of its luxury goods

a country that licenses some television shows

a country that has some international businesses

One social issue often facing developing countries is

democratic rule is easily obtainable.

reluctance to accept change.

a shortage of natural resources.

very high population growth.

One sign of transition to a mixed-market economy is the establishment of

a fair labor market.

anti-poverty regulations.

state-owned business.

a smaller middle class.

importeddomestic

imported

domestic

A country with a ________ economy generally has a high standard of living.

developing

developed

emerging

transitioning

An outline for an informative essay should

use effective language.

state the main topics.

use smooth transitions.

include all relevant details.

The chart below shows an exchange rate table.

US dollar.

Swiss franc.

Japanese yen.

euro.

"GDP per capita" means that the GDP is calculated per

country.

day.

dollar.

person.

When revising for style in an informative essay, a writer should replace

slang and contractions.

data and contractions.

slang and transitions.

data and transitions.

On which country has the United States imposed an embargo since 1960?

Cuba

Iran

North Korea

Syria

In a transitional economy, a(n) ________ economy is changing to a mixed-market economy.

advanced

command

free-market

developed

Global trade provides consumers with

more options and lower prices.

fewer options and lower prices.

more options and higher prices.

fewer options and higher prices.

Countries now rely on one another for vital resources.

Countries now rely on each other for new industries.

Countries now rely on one another for chances to import and export.

Countries now rely on one another to lower their GDP.

Countries rely on each other for cheaper products.

Countries now rely on one another for an employment base.

The purpose of an outline for an informative essay is to

explain the essay’s structure.

cite research materials.

use effective language.

include strong paragraphs.

What is the first step to creating an informative essay?

editing

prewriting

drafting

sequencing

What kind of advantage does a country have if it can make a product more efficiently?

an import advantage.

an export advantage.

a comparative advantage.

an absolute advantage.

Technologies that allow for instant worldwide communication include

high-speed trains and naval ships.

mobile phones and Internet access.

airplanes and container shipping.

outsourcing and new trade markets.

What role does competition play in international trade?

It results in higher prices.

It discourages imports.

It drives down prices for consumers.

It does away with the need for investment.

The table compares two countries and two products.

focus both on its petroleum and seafood industries

focus on the seafood industry only

focus on the petroleum industry only

decide to find another industry to focus on

Why do most countries both export and import goods?

to eliminate competition from other economies

to decrease the production of goods domestically

to rely entirely on foreign economies

to get a good mix of goods and services

When revising a body paragraph in an informative essay, it is important to make sure

it has a clearly stated main point.

it is complex and detailed.

it restates important evidence.

it includes a thesis statement.

International trade organizations promote free trade by encouraging countries to

maintain their tariffs.

establish their trade quotas.

reduce their trade barriers.

develop their products.

What is the purpose of quotas?

to ban all imports from a country

to ensure specific goods are not available to consumers

to limit how much of a good can be imported

to keep prices on domestic goods low

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