Economic Concepts Quiz

What does the business cycle describe?

• The process of starting a new business

• The economic decisions made by a single company

• The ups and downs, or fluctuations, in an economy

• The creditworthiness of a consumer

What is a command economy?

• An economy where the market is free from government intervention

• An economy where consumers make all the economic decisions

• An economy where economic decisions are largely made by a central authority

• An economy based on the creditworthiness of consumers

Who is considered a consumer?

• A person who provides goods and services

• A person who buys goods and services to satisfy their wants and needs

• A central authority in a command economy

• A lender assessing the creditworthiness of an individual

What is credit?

• The history of a person's financial decisions

• The ability of a consumer to obtain financing necessary to purchase goods or services before payment

• The economic cycle of a country

• The system of economic decision-making in a command economy

What does creditworthiness refer to?

• The economic stability of a country

• The ability of a consumer to buy goods and services

• The level of confidence a lender has in awarding financial credit to a person or company

• The decision-making process in a command economy

What is debt?

• The act of making a purchase with the expectation of a profit.

• Money owed to others or the state of owing money.

• A plan to get a debt under control through financial planning and budgeting.

• Income remaining after deduction of taxes and other obligations.

What is the purpose of debt management?

• To control the way a business can operate.

• To study the economics of a country as a whole.

• To get a debt under control through financial planning and budgeting.

• To motivate people to respond in predictable ways.

What does disposable income refer to?

• The market price at which the supply of an item equals the quantity demanded.

• The income remaining after deduction of taxes and other obligations.

• The means by which the national or state government adjusts its expenditures or tax revenues.

• The act of making a purchase with the expectation of a profit.

What is the equilibrium price?

• The percentage used to calculate the amount paid for borrowing money.

• The income remaining after deduction of taxes and other obligations.

• The market price at which the supply of an item equals the quantity demanded.

• The study of economics concerned with the economy as a whole.

What is the main goal of fiscal policy?

• To manipulate a person for the purpose of gain, usually financial.

• To control the way a business can operate and the way individuals respond.

• To promote full employment, price stability, and reasonable rates of economic growth.

• To motivate people to respond in predictable ways.