MP4 Wk9

What might happen to an economy if there are fewer people starting new businesses?

• More government spending

• Fewer job openings

• Lower taxes

• More imports

Use the chart below to answer the question. What type of investment is described in this chart?

• Bonds

• Stocks

• Mutual Funds

• Money Market Accounts

What is a shared feature of both sole proprietorships and partnerships?

• Ability to issue corporate bonds

• Owners are personally responsible for business debts

• Profits are taxed twice

• Required to have a board of directors

Refer to the information provided. Between March 2007 and October 2009, the unemployment rate in the United States increased from 4.4% to 10.2%. What is the MOST LIKELY explanation for this rise in unemployment?

• There was a significant increase in the number of people retiring during this period.

• The country was likely undergoing a major economic downturn or crisis.

• Wages for most workers increased rapidly, leading to more job openings.

• Government spending on social programs was at an all-time high.

Which action is an example of the government working to reduce the effects of an economic downturn?

• A city council hires a private company to manage public parks.

• A state legislature increases property taxes to fund education.

• The federal government offers subsidies to small businesses during a recession.

• The president encourages citizens to save more money.

What is an immediate effect of releasing oil from the U.S. Strategic Petroleum Reserve in response to rising fuel costs?

• Lower gasoline prices for consumers

• Reduced domestic oil production

• Increased long-term energy independence

• Higher government tax revenue from oil sales

Refer to the list below to answer the question. Which phrase BEST completes the heading? Tools Used by _______?

• Businesses to Increase Profits

• Congress to Pass Legislation

• the Federal Reserve to Influence the Economy

• Labor Unions to Negotiate Wages

What is the likely effect on the economy if the Federal Reserve sells government securities in the open market?

• Increase in interest rates, Decrease in the money supply, Decrease in aggregate demand, Decrease in consumer spending

• Decrease in interest rates, Increase in the money supply, Increase in aggregate demand, Increase in consumer spending

• Decrease in interest rates, Decrease in the money supply, Decrease in aggregate demand, Decrease in consumer spending

• Increase in interest rates, Increase in the money supply, Increase in aggregate demand, Increase in consumer spending

John has a low credit score and often misses his bill payments. Which of these is MOST likely true about John? Choose TWO answers.

• He is considered a high-risk borrower.

• He will easily qualify for the best loan rates.

• He may have to pay higher interest rates on loans.

• He always pays his bills on time.

• He is unlikely to face financial difficulties.

Which of the following could cause a policy to have an unintended negative outcome?

• Lower prices increase demand.

• Reduced taxes boost investment.

• Higher interest rates reduce borrowing.

• Increased wages raise production costs.