Community and Economy Test

What is a role of business in the economy?

• approve a new government plan
• buy products for personal use
• produce goods and services
• provide labor to build products

Free enterprise is different from a command economy because ________.

• businesses are given the prices to set
• businesses set the price based on consumers' decisions
• businesses are free from any laws
• to pay the government for private goods

What are the three basic economic questions?

• when to produce, where to produce, who to produce for
• what to produce, how to produce, who to produce for
• how much to produce, how much to charge, how to make it
• who will buy, how much to charge, what resources are needed

One option to solving the challenge of scarcity in a free market economy is ________.

• have people make better choices
• make the government provide for everyone's needs
• decrease the amount of resources
• encourage philanthropy among citizens

Why do people pay taxes?

• to pay the government for private goods
• to be gifted to business owners
• to be deducted by banks
• to pay for the things government provides to people

Select the true statement.

• Gross pay is how much money you have after taxes are taken out
• Net pay is the amount of money you receive in your paycheck.
• Gross pay is divided by the tax percentage to equal net pay.
• Net pay is multiplied by gross pay to find your tax amount.

If your income for one week is $200 and your tax rate is 5 percent, what is your net pay? 200 – (0.05 × 200) = _____

• $205
• $195
• $190
• $100

Which option is a private good or service?

• fire station
• school
• government office
• grocery store

One example of philanthropy is ________.

• doing volunteer work
• playing with friends
• paying your bills
• shopping for family

What does philanthropy mean?

• the effort to increase the well-being of others through charitable giving
• the effort to provide health care by the government
• the ability to sell goods and services at a discount
• the requirement to pay taxes as a citizen