AnswersFL-2106010-MJ Civics B-CRUnit Test

Unit Test — Unit test Answers

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1
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What is the next step in the circular flow of income after workers receive wages?

A
The money becomes part of a firm’s resources.
B
The money becomes part of a household’s income.
C
The money is used to pay for factors of production.
D
The money is used to produce goods and services.
2
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In the government, many public policy decisions are made by elected officials who

A
only support policies that have widespread acceptance by everyone in their state or district.
B
always try to eliminate the economic pressures felt by the people who voted them into office.
C
are directly impacted by the economic decisions they make when they pass new public policies.
D
don’t face the same economic pressures as the individuals who are impacted by their decisions.
3

In the 1980s and 1990s, movie-rental stores offered videotape and DVD rentals to consumers. By the early 2000s, companies were offering movie downloads from the internet. The demand for videotapes and DVDs dropped.

A
the effect of limited supply on demand
B
the effect of seasonal demand on goods
C
the effect of consumer interests on demand
D
the effect of outdated technology on demand
4

Amara has just started an entry-level job at a software company. The first two months will be spent in a training program to learn about the company’s software and to develop the skills needed for the job.

A
land
B
labor
C
capital
D
entrepreneurship
5

Which best describes the role of the US government in economic decisions involving health care?

A
The government covers medical and healthcare costs for all Americans so that everyone can get the same level of care.
B
The government spends very little money on health care so Americans must all pay their own healthcare costs out of pocket.
C
The government follows voters’ wishes to decide how much money is spent per person on healthcare programs and medical treatment.
D
The government spends a lot of money on healthcare programs for people ages 65 and older, people with disabilities, and people living in poverty.
6

What is one way that mixed-market and command economies differ?

A
Only mixed-market economies respond to consumer needs when making economic decisions.
B
Only command economies allow competition to affect the prices of goods and services.
C
Only command economies involve the government in economic decision-making.
D
Only mixed-market economies allow consumers and producers to control the means of production.
7

What causes prices to fall during deflation?

A
decreasing demand
B
increasing demand
C
short supply
D
high production costs
8

Producers need to understand consumers so they can

A
acknowledge the values that consumers hold.
B
consider how consumers’ resources are limited.
C
identify consumers’ needs and wants so they can choose the right resources.
D
consider what consumers are willing to pay before deciding what to produce.
9

Hector’s house and small farm are next to an interstate highway. The government needs Hector’s land to build an exit for the interstate.

A
Federal Trade Commission
B
Sherman Act
C
Compensation Clause
D
Declaration of Independence
10

What steps did the US government take toward Standard Oil in the early 1900s?

A
It encouraged Standard Oil to purchase other oil-refining companies.
B
It supported Standard Oil’s efforts to increase oil-refining capacity.
C
It used the Federal Trade Commission to investigate Standard Oil.
D
It used the Sherman Act to split Standard Oil into smaller companies.
11

Which scenario shows how a market economy is motivated by self-interest?

A
For years, Tire Company X was the only place to buy tires for 100 miles in any direction. The lack of competition meant that the company could charge higher prices for its tires. However, a new tire company has recently opened in the area. Competition has driven down prices.
B
Consumers have filed many complaints against Company A for failing to deliver products purchased from their online store. Based on the complaints, the state government has charged the company with violating the state’s consumer-protection laws.
C
It is the end of summer and Clothing Company Z has a surplus of summer clothes. Maite Ruiz, the store’s owner, decides to hold a sale on summer clothes. If customers buy three items of clothing, they will get 20 percent off the price. If they buy six items, they will get 40 percent off the price.
D
Over the last 10 years, Company B has purchased several companies that provide the same goods and services. It is now trying to buy its last large competitor. The government is trying to block the purchase, claiming that Company B already controls too much of its market.
12

Review the graph.

Question illustration
A
a supply curve
B
a supply schedule
C
a demand curve
D
a demand schedule
13

What does the Consumer Price Index (CPI) measure?

A
The CPI measures the rate of inflation.
B
The CPI measures the effect of deflation.
C
The CPI measures the use of factors of production.
D
The CPI measures the public’s demand for goods.
14

What is the first question people should ask themselves when they’re about to make an economic decision?

A
“How much do I value or need this?”
B
“What do I have to give up now to get this?”
C
“What will others think of me if I get this?”
D
“What will I be giving up in the future to get this?”
15

What is the most important thing people must do to understand the opportunity costs for any big economic decision they make?

A
They must enlist the support of everyone involved in making the decision a reality.
B
They must investigate both the explicit and implicit costs involved in the decision.
C
They must make an accurate budget and make sure there is enough money available.
D
They must look at the time required to make the decision and see it come to pass.
16

The price for which Company X can sell its product drops from $10 to $6, which is less profitable. What will the company most likely do?

A
increase production
B
decrease production
C
maintain production
D
stop all production
17

A clothing company is deciding whether to make wool sweaters from yarn that is spun and dyed by individual craftspeople or from yarn that is mass-produced by machines.

A
Handcrafted yarn will be less scarce because it does not require a factory to produce it.
B
Mass-produced yarn will be less scarce because it does not require a factory to produce it.
C
Mass-produced yarn will be scarcer because it takes more time and labor to produce it.
D
Handcrafted yarn will be scarcer because it takes more time and labor to produce it.
18

Review the graph.

Question illustration
A
Consumer demand for microwave ovens has risen over time.
B
The cost of plastic and other raw materials has slowly increased.
C
Microwave ovens have become much less expensive to produce.
D
The price of microwave ovens has shifted to match the cost of living.
19

Review the chart.Based on the chart, which job is probably the most difficult to fill?

Question illustration
A
airline pilot
B
air traffic controller
C
airfield operations specialist
D
flight attendant
20

During colonial times, the British government passed a law that lowered the taxes paid by the British East India Company on the tea it shipped to the American colonies. The purpose of the law was to give the company control of the colonial tea market by making its tea much cheaper than any alternative.

A
by passing the Sherman Act
B
by adopting the Compensation Act
C
by creating a federalist system
D
by outlawing decentralization

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