Entrepreneurship — Unit test Answers

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1
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Which statement explains a way how the Securities and Exchange Commission upholds fair business practices?

T
The SEC makes sure that banks follow federal laws.
T
The SEC tries to limit risk in the financial system.
T
The SEC generally oversees banking practices.
T
The SEC generally oversees financial advisers.
2
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Among the changes that labor reformers wanted after the Industrial Revolution was

m
more jobs for untrained workers.
a
a ban on child factory workers.
j
jobs for women factory workers.
e
equal pay for owners and workers.
4

most likely

c
cooperatives give majority owners the most control, while franchises make decisions with a parent company.
c
cooperatives make it easy to accumulate supplies, while franchises come with supplier relationships already in place.
c
cooperatives are well financed by members, while franchises must raise large sums of money to launch a business.
c
cooperatives allow all owners to share profits, while franchises are required to share profits with a parent company.
5

Which group does the Fed serve?

f
financial institutions
c
consumers
g
government bodies
b
bankers
7

Which body manages the Fed?

t
the Appropriations Committee
t
the Federal Reserve Board
t
the Federal Open Markets Committee
t
the Economic Policy Subcommittee
8

Articles of partnership establish

h
how businesses can raise capital.
w
what business taxes are paid.
h
how profits and losses are divided.
w
what is included in a charter.
9

Spending that can change from year to year is known as

A
discretionary spending.
B
deficit spending.
C
mandatory spending.
D
expansionary spending.
10

What part does interest play in deficit spending?

A
Governments must pay interest on money they borrow when they take on debt.
B
Citizens must pay interest when their governments borrow money.
C
Governments may charge foreign countries interest when they borrow money.
D
Interest is not a factor when a government’s budget is in deficit.
12

Many classical economists such as Adam Smith believed that government should

i
intervene often in the economy.
i
intervene little in the economy.
a
always intervene in the economy.
t
totally control the economy.

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