AnswersEA Academy Civics 9The Economy of the US

The Economy of the US — Unit test Answers

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1
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Why is decentralization of power an important part of capitalism and a free-market economy?

A
It strengthens companies by helping them form alliances.
B
It keeps any one company from becoming a monopoly.
C
It makes it illegal for companies to gain too much power.
D
It prevents workers from asking companies for raises.
2
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What is one way that citizens can influence the economy through the democratic process?

A
support the local economy by shopping at neighborhood stores
B
strengthen the domestic economy by buying US-made goods
C
vote for representatives who share their views on the economy
D
limit purchasing goods that benefit a foreign country’s economy
3

Miguel Alvarez owns a horse ranch. He trains horse for rodeos and for work on cattle ranches. As a rancher, he uses different factors of production.

A
the pasture where the horses graze
B
the saddles he buys to train his horses
C
the wind energy he generates on his ranch
D
the ranch hands he hires to train his horses
4

Rubber is a raw material used to manufacture tires. Several US tire companies import rubber from South America. Rubber comes from trees that grow in tropical areas. During this year’s hurricane season, several strong storms damaged many South American forests. As a result, there is less rubber available than in previous years.

A
The price of tires will decrease due to the cost of rubber going up.
B
The price of tires will decrease due to the cost of rubber going down.
C
The price of tires will increase due to the cost of rubber going up.
D
The price of tires will increase due to the cost of rubber going down.
5

Why is bartering not used globally on a large scale to meet the needs of people and populations?

A
It would require the value of goods and services to be standardized.
B
It can be used only during times of crisis.
C
It has been replaced by time banks as a way to exchange goods and services.
D
It requires too many different kinds of coins and paper money.
6

Review the graph.

Question illustration
A
a supply curve
B
a supply schedule
C
a demand curve
D
a demand schedule
7

The Summerville city council has money in its budget that it needs to spend now. The council is debating whether to use these limited funds to build a new park or repair several streets in the oldest section of town. The resources for both projects are available and will cost the city about the same amount of money.

A
why people’s needs and wants are unlimited
B
how scarcity might affect future projects
C
the townspeople’s needs and wants
D
how it will produce each project
8

During the COVID-19 pandemic, the US federal government provided assistance money to individuals, businesses, and state and tribal governments.

A
regulate trade
B
avoid subsidies
C
prevent monopolies
D
stimulate the economy
9

Which shirt would most likely be the most expensive?

A
a mass-produced cotton shirt
B
one shirt signed by a famous rapper
C
one shirt out of two-thousand concert T-shirts
D
a mass-produced silk shirt
10

Review the graphic organizer.

Question illustration
A
traditional economy
B
command economy
C
market economy
D
mixed-market economy
11

A hardware store has a big sale on paint. During the sale, the demand for paintbrushes, paint rollers, and painter’s tape sharply increases. Which factor explains this rise in demand?

A
substitute goods
B
complementary goods
C
competition
D
price
12

Which economic system is most likely to have a single communist political party?

A
traditional economy
B
market economy
C
command economy
D
mixed-market economy
13

Which best describes scarcity?

A
the idea that resources, wants, and needs are all unlimited
B
the idea that resources should fulfill unlimited needs and wants
C
the idea that land, labor, and capital are limited
D
the idea that land, labor, and capital are unlimited
14

What is another word for commerce?

A
trade
B
democracy
C
capitalism
D
freedom
15

What is the cause of demand-pull inflation?

A
Prices rise due to high consumer interest.
B
Prices rise after production costs increase.
C
Prices rise due to a drop in product supply.
D
Prices rise in response to a cost-of-living increase.

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