Answers 26-27 Ignite Economics-KY-EconomicsInflation and Stagflation (continued)

Inflation and Stagflation (continued) — Unit test Answers

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The graph shows the number of employed workers in the United States in nonfarm jobs from 2008 to 2013.

The United States had the world’s weakest economy by 2010.

In today's economy, a country needs fewer workers to remain strong.

By 2012, the United States had solved its economic problems.

The United States faced an economic crisis that started in 2008.

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Governments collect taxes to ensure that

there is sufficient money to fund private businesses.

citizens contribute to meeting society's needs.

politicians get paid in a timely manner.

a government program exists for every need that arises.

Franchises are attractive to business owners because

they have a proven business model.

they are typically inexpensive to buy.

they get to keep all profits.

they come with very little risk.

The graph shows the number of employed workers in the United States in nonfarm jobs from 2008 to 2013.

reducing the size of its armed forces

laying off unnecessary workers

decrease taxes to increase consumers' money supply

encouraging people to travel overseas

When revenues are higher than expenditures in a budget, that budget

shows a deficit.

is in balance.

must be discarded.

shows a surplus.

The graph shows the number of employed workers in the United States in nonfarm jobs from 2008 to 2013.

remained consistent over time.

started going down in 2008.

went up every year since 2008.

started going down in 2010.

Which of the following statements most accurately describes the federal government and its employees?

Millions of Americans work for the federal government.

The federal government is not allowed to hire employees.

The majority of Americans are employed by the federal government.

The number of federal employees is too small to affect government spending.

A disadvantage of forming a partnership is that owners

can find it tougher to start and stop a business.

can find it more difficult to get a bank loan.

are only responsible for their own finances.

are fully responsible for their partners' losses.

Read the scenario.The citizens of Country D have noticed that the average prices of most goods within their nation have begun to rise. At the same time, employers are not raising wages at the same rate. The combination of these challenges has resulted in a decrease in overall demand, causing a decline in GDP.

the government of Country D

the enterprises of Country D

the businesses of Country D

the workers of Country D

In a free enterprise system, governments address public problems through policy to ensure that

citizens' needs are met and protected.

economic operations of businesses are controlled.

workers earn more than workers in other countries.

the nation's level of productivity remains steady.

An entrepreneur who opens a franchise must

assume debts.

keep profits.

offer training.

select sites.

Which of these best describes income tax?

regressive tax

indirect tax

direct tax

proportional tax

A graph shows the Total Public Debt of the U S Government from 1993 to 2013 with Year on the x-axis and Total public debt in trillions of U S dollars on the y-axis, from 0 to 20 in increments of 5. The debt stays constant from 1993 to 2001 and then steadily increases.

It is increasing.

It has leveled off.

It is decreasing.

It has not changed.

Entrepreneurs who want to open a franchise

buys the rights from the parent company and creates his or her own rules.

buy the rights from the parent company and invest in a location approved by the parent company.

invest in a location and create a business model for the franchise.

invest in a location and develop a trademark for the franchise.

Which of these effects of expansionary spending would a government most want to avoid?

higher employment

higher inflation

growth in production

growth in consumer spending

Minimum wageChild laborUnion membershipWorkers’ compensation

Minimum wage

Child labor

Union membership

Workers’ compensation

The diagram shows the three-step process by which economic policy is created.

Discuss a plan.

Interview an interest group.

Identify a problem.

Gather data.

A goal of financial regulatory agencies is to

prevent monopolies.

enforce workplace safety.

protect the environment.

enforce food safety.

Read the graph.

Fewer new businesses were started in 2010 than in other years.

The opening of new businesses peaked between 2007 and 2008.

More new businesses were started in 2006 than in 2005.

The number of new businesses remained constant between 2006 and 2009.

Country Q has experienced a rapid increase in its unemployment rate and a sharp decline in its GDP.What might policymakers do in the face of these economic indicators?

encourage a decrease in purchasing until employment figures increase

try to trade with other nations to increase production and create new jobs

increase taxes so the government has more money to spend

implement controls on wages, forcing employers to pay higher wages

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Inflation and Stagflation (continued) — Unit test Answers

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