Practice Questions 2: Economic Indicators

What is the primary impact of inflation on the purchasing power of money?

• Increases purchasing power

• Decreases purchasing power

• Has no effect on purchasing power

• Stabilizes purchasing power

Which of the following is a role of tariffs in international trade?

• To increase domestic competition

• To protect domestic industries

• To decrease government revenue

• To promote free trade

Which things are included and excluded from the National GDP?

Groups:

(a) GDP

,

(b) Excluded from GDP

• Volunteer work

• Products sold to other countries

• Stock Purchases

• Money spent on groceries

• Gifts and donations

• Illegal activities

• Business investments

• Government salaries

• Defense Spending

• Online Subscriptions

• Household labor

• Sales of used goods

• Investment in infrastructure

What was Alexander Hamilton's stance on the constitutionality of the National Bank?

• Federal Government had more power during wartime

• Necessary and Proper Clause allowed federal government

• 10th Amendment gave that power to states

• He believed it should be decided by the states

What was Thomas Jefferson's view on the constitutionality of the National Bank?

• Federal Government had more power during wartime

• Necessary and Proper Clause allowed federal government

• 10th Amendment gave that power to states

• He believed it should be decided by the states

Which of the following is EXCLUDED from GDP calculations?

• Government spending

• Net exports

• Digital goods

• Consumer spending

How does inflation typically affect interest rates set by the Federal Reserve?

• Inflation leads to lower interest rates

• Inflation leads to higher interest rates

• Inflation has no effect on interest rates

• Inflation leads to fluctuating interest rates

The year the first National Bank was established is...

• 1791

• 1800

• 1816

• 1836

When was the National Bank dissolved?

• 2025

• 1836

• 1850

• 1939

When was the Federal Reserve Act passed?

• 2011

• 1913

• 1987

• 1787