WorksheetsIntro to Business: Ch. 2 Review
Total questions: 35
Worksheet time: 18mins
Name
Class
Date
1.
Economic growth refers to a steady increase in the production of goods & services in an economic system.
a)
True
b)
False
2.
One component of GDP is the value of a country's exports plus the value of the imports into the country.
a)
True
b)
False
3.
The more goods and services produced, the healthier an economy is considered to be.
a)
True
b)
False
4.
In the United States, all people over the age of 21 who do not have a full-time, paying job are considered "unemployed."
a)
True
b)
False
5.
Business cycles are the recurring ups & downs of gross domestic product.
a)
True
b)
False
6.
GDP measures a country's economic output during
a)
one week
b)
one month
c)
one year
d)
five years
7.
GDP does NOT include
a)
consumer spending for food
b)
the value of the work you do for yourself
c)
government spending to pay employees
d)
business spending for equipment
8.
Which of these items WOULD be counted when measuring GDP?
a)
tomatoes still growing on the vine
b)
sheets of steel
c)
rolls of raw fabric
d)
a fully assembled washing machine
9.
Dividing GDP by the total population of a country results in that country's
a)
GDP per capita
b)
gross GDP rate
c)
unemployment rate
d)
personal income per capita
10.
All of the following people are part of the labor force EXCEPT
a)
Martin, who was laid offfrom his job last week & has answered 3 want ads this week.
b)
Cody, who works as a supervisor in a nonprofit organization.
c)
Lindsay, a stay-at-home mom with 2 children.
d)
Marie, a 17-yr.-old who works part-time at the corner drug store.
11.
If wages increase faster than gains in productivity, prices will rise. Why?
a)
Business owners will demand higher prices because they know workers have more money to spend.
b)
Because demand will increase for all products.
c)
Because the cost of producing goods decreases.
d)
Because the cost of producing goods increases.
12.
In the early 1890s, the average employee in the United States worked about how many hours per week?
a)
40
b)
60
c)
75
d)
100
13.
Which of the following probably would result in a DECREASE in worker productivity?
a)
An office replaces its 10-yr-old computers with brand-new machines and the latest software and the employees receive extensive training in their use.
b)
An office replaces its 10-yr-old computers with brand-new machines and the latest software but employees receive no training on their use.
c)
a factory trains workers on how to use shop equipment more efficiently.
d)
The boss promises a bonus to all employees who come into work over the weekend to finish an important project.
14.
Retail sales
a)
usually remain stable in times of economic growth.
b)
indicate general consumer spending patterns in the economy.
c)
include the sale of services bought by businesses.
d)
all of the above are correct.
15.
____ occurs at the peak of the business cycle.
a)
recovery
b)
depression
c)
recession
d)
prosperity
16.
Which of the following is NOT a characteristic of a depression?
a)
high demand for goods and services.
b)
a prolonged period of high unemployment.
c)
business failures.
d)
GDP falls rapidly.
17.
If GDP growth slows for at least ___ quarter(s) in a calendar year, the economy is probably in a recession.
a)
4
b)
3
c)
2
d)
1
18.
A recession often affects some groups of workers in related businesses. The drop in related businesses is called
a)
the ripple effect
b)
the business cycle
c)
the placebo effect
d)
the halo effect
19.
Inflation
a)
increases the buying power of the dollar.
b)
always discourages economic growth.
c)
tends to decrease wages.
d)
is most harmful to people living on fixed incomes.
20.
The interest rate banks charge their best business customers is the
a)
discount rate
b)
prime rate
c)
mortgage rate
d)
T-bill rate
21.
The major influence on the level of interest rates is
a)
the supply and demand for money.
b)
the unemployment rate.
c)
the consumer price index.
d)
the rate of inflation.
22.
Which of the following is an example of a capital project?
a)
a large corporation gives all employees a 5% wage increase.
b)
A small office buys several boxes of paper for the printer.
c)
a mid-size company restocks the supply cabinet with pencils and markers.
d)
A small business purchases 2 new pickup trucks.
23.
If you purchase a corporate or government bond, you are a(n)
a)
creditor
b)
stockholder
c)
entrepreneur
d)
partner
24.
The money people deposit in banks and other financial institutions
a)
is lent to businesses to fund capital projects.
b)
generally earns interest for the depositors.
c)
is an important factor in the economic growth of a country.
d)
all of the above.
25.
The portion of the labor force who are not working is the _____ rate.
a)
unemployment
b)
domestic
c)
inflation
d)
debt
26.
____ is the production output in relation to a unit of input, such as a worker.
a)
productivity
b)
capital
c)
surplus
d)
income
27.
Personal ____ refers to salaries and wages, as well as investment income and government payment to individuals.
a)
income
b)
inflation
c)
stock
d)
productivity
28.
Retail sales include the sales of durable and non-durable goods bought by _____.
a)
consumers
b)
corporations
c)
productivity
d)
the unemployed
29.
The movement of the economy from one condition to another and back again is called the business _____.
a)
cycle
b)
inflation
c)
depression
d)
debt
30.
An economic ____ is the phase in which unemployment begins to decrease, demand for goods and services increases, and GDP begins to rise again.
a)
Recovery
b)
Recession
c)
Depression
d)
Prosperity
31.
____ is an increase in the general level of prices.
a)
Inflation
b)
Interest
c)
Income
d)
Increase
32.
____ represents ownership, or equity, in a corporation.
a)
Stock
b)
Bonds
c)
Debt
d)
Surplus
33.
A bond represents ____ for an organization.
a)
Debt
b)
Income
c)
Inflation
d)
Productivity
34.
When a government spends less than it takes in, a budget ____ is the result.
a)
surplus
b)
deficit
c)
income
d)
inflation
35.
_____ is a period in the business cycle when demand begins to decrease, businesses lower production, and GDP growth slows for 2 or more quarters in a calendar year.
a)
Recession
b)
Depression
c)
Recovery
d)
Prosperity
100 %
