Econs Quiz (Chap 3.1-3.3)

_________ is major factor in determining the overall levels of spending, saving and borrowing by households.

• Money

• Income

• Inflation

The more the disposable income, the more people consume.

• Yes

• No

Banks will be more willing to lend to wealthy and high-income earning people.

• Yes

• No

What is indirect tax?

• a tax on income or wealth

• the use of money to purchase goods and services

• that part of someone's income which is not spent on consumption

• a tax is passed off to the consumer as part of the purchase price of a good or service.

Middle-income household are likely to spend all of their income.

• Yes

• No

What is wage rate?

• Money you get for your work.

• The amount of money you earn per hour, day, or piece of work you complete.

• An annual amount of money paid to a worker in exchange for their labour.

• The amount of money received before any additional payment are added

Richer people will be in a better position to save some of their income because there is a greater likelihood that some of the income will be unspent even after essential and non-essential items have been paid for.

• Yes

• No

As interest rate rise, people may save ______ and spend _____

• more; less

• less; more

Advantages of specialization for workers

• To produce higher output

• Lack of job security

• To become more skillful and knowledgeable in their job

• Able to focus on Research & Development (R&D)

Skilled workers are more likely to have a greater demand and higher paid wages.

• Yes

• No