Econ Final Exam 1

Which of the following is NOT a primary source of revenue for the US federal government?

• Income Taxes

• Corporate Taxes

• Payroll Taxes

• Property Taxes

What is net income?

• Money before taxes

• The total of your monthly expenses

• Money earned from selling assets

• Money you take home after taxes

What does the term “deductible” mean in insurance?

• Money you get from your bank

• The amount you pay before insurance covers costs

• Your monthly salary

• Interest paid to you by your credit card

Which of the following is deducted under FICA?

• Cell phone bills

• State sales tax

• Social Security and Medicare

• Insurance premiums

If real GDP is $100 and the number of people in a country is 20, then real GDP per capita in that country is:

• $5

• $100

• $200

• $2000

A customer buys a strawberry smoothie from a restaurant. The purchase of the smoothie is added to GDP under consumption.

• True

• False

The price of coffee increases, but the amount sold remains the same. What would increase?

• Nominal GDP

• Real GDP

Which of the following items would be best suited for use as money?

• Candy Canes

• Space ships

• Snowmen

• Rare Van Gogh paintings

If the money supply decreases, what would you expect to happen to prices?

• Prices will increase.

• Prices will decrease.

• Nothing will change.

What is one reason people might dislike inflation?

• They hate balloons.

• Their wages may not rise as fast as prices.

• If they are borrowers, inflation erodes their loan.

• None of the above, inflation always helps consumers.