Economic Understanding

The banking sector of the U.S. economy provides services that deal with an individual's money. What impact does a savings account have on an individual's money?

• Interest is paid on money in a savings account.

• Savings accounts stopped being offered after WWII.

• The government takes interest away each time a savings account is opened.

• Loans are given out to only those individuals who have a savings or checking account.

What are the two MAIN elements of a personal budget?

• goods and services

• income and expenses

• needs and wants

• competition and market

Which of the following is an example of how businesses can be both consumers and producers?

• All businesses produce both goods and services.

• Businesses consume goods and services in order to produce goods and services.

• Businesses only provide services.

• Businesses only consume goods and services.

Doug goes to the store to buy a snack. He only has $2. Chocolate bars are $2 and drinks are 1$. He chooses to buy 1 chocolate bar because he only has $2. Doug had to give up on buying a drink. What Doug gave up when he made a choice is a(n) ________________.

• budget

• specialization

• price incentive

• opportunity cost

The federal and state governments collect taxes from households and businesses to fund all of the following except __________________.

• Public schools

• Bridges and roads

• Car insurance

• US Military

Samantha earned $1,000.00 baby-sitting over the summer and placed all of her money in a savings account at her bank. She returned to the bank months later and noticed there was now $1,038.00 in her bank account. What caused the extra money in Samantha’s bank account?

• Interest

• Investment

• Equity

• Capital

Jaylon earns $20 a week for completing household chores. He wants to purchase the new PlayStation 4. He asked his mom to purchase it for him, but she said he needs to use his own money to purchase the PlayStation 4. What is Jaylon going to have to do in order to have enough money to make the purchase?

• Spend his weekly allowance on PS4 games and hope that his mom buys the PlayStation4 for him.

• Create a personal budget and a plan to save his money each week until he has enough to buy the PlayStation4 on his own.

• Create a personal budget, save his allowance for two weeks, and then spend it all on a new football to match the one his friend, Thomas, just bought.

• Ask his grandparents for the money

Which of these BEST describes the function of private business?

• to maintain the security of citizens

• to provide services through taxation

• to produce goods and services for the public

• to provide savings and investment opportunities to the public

When someone is specialized in a skill, how does it affect their job?

• Income levels decrease because workers are less valued.

• Production rates increased because workers became more skilled.

• Unemployment rates increased because demand for workers decreased.

• Workplace injuries increased because working conditions became more dangerous.