Font size
WorksheetsEconomics Final Exam Review Fall 2020
Total questions: 50
Worksheet time: 50mins
What determines the value of an item?
The amount of goods that are produced.
The capital required to build the factory.
The unlimited wants of the consumers.
The resources consumed in production.
Select the three economic questions.
What should be produced?
Who should receive the product?
How should goods and services be created?
When should we produced the products?
Why should goods and service be produced?
Which of the following illustrates an opportunity cost?
James has enough money to buy some stocks and a book.
Alyssa does not have enough time to study for her test.
Amir only has time to study or play basketball.
Lydia does not have enough money to buy a new shirt.
Assessing opportunity cost involves
making choices and deal with consequences.
choosing consequences over rewards.
reviewing past decisions and changing them.
minimizing profit and loss.
The most common economic system in the world is a
closed economy.
command economy.
mixed market economy.
traditional economy.
How does a command economy differ from a mixed market economy?
In a command economy, citizens have fewer property rights. In a mixed market economy, citizens have more property rights.
In a command economy, citizens have more property rights. In a mixed market economy, citizens have fewer property rights.
In a command economy, citizens own all public property. in a mixed market economy, the government owns all private property.
In a command economy, citizens own all private property. In mixed market economy, the government owns all public property.
In a free enterprise system, consumers decide
how to set prices.
which goods to export.
which services and products to buy.
how to use materials.
According to the law of supply, price and quantity move
in the same direction.
in opposite directions.
towards one another.
from the same point away from each other.
Which statement best explains the law of supply?
The quantity supplied by producers increases as prices rise and decreases as prices fall.
The quantity supplied by producers decreases as prices rise d and increases as prices fall.
The quantity supplied by consumers increases as prices rise and decreases as prices fall.
The quantity supplied by consumers decrease as prices rise and increases as prices fall.
The amount of goods and services consumers want is called the
count
demand
number
supply
According to the law of demand, price and quantity move
in the same direction.
in opposite directions.
toward one another.
from the same point away from one another.
Equilibrium is defined when
supply is limited and demand decreases.
supply and demand meet.
demand is higher than supply.
supply is higher than demand.
Disequilibrium occurs when
quantity supplied is equal to quantity demanded.
quantity supplied does not equal quantity demanded.
supply coordinates with price.
supply coordinates with quantity.
In economics, if a good is inelastic
consumers have lost an interest in purchasing it.
producers have lost an interest in manufacturing it.
its supply or demand is too sensitive to price changes
its supply and demand is not sensitive to price changes.
Profit equals the total amount of money made minus
expenses
prices
revenue
supply
What is the best definition of marginal benefit?
The possible income from producing an additional item.
The price of producing one additional unit of a good.
The additional income gain from business activity minus expenses.
The financial gain from business activity minus expenses.
What is the best definition of marginal revenue?
The possible income from producing an additional item.
The price of producing one additional unit of a good.
The additional income gained from selling an additional good.
The financial gain from business activity minue expenses.
What is the best definition of marginal cost?
The possible income from producing an additional item.
The price of producing one additional unit of a good.
The additional income gained from selling an additional good.
The financial gain from business activity minus expenses.
Which body or group is most able to use money to influence the economy?
Government
Suppliers
Firms
Producers
In MACROeconomics, the economy can best be understood through the use of
money
models
pricing
debates
Economic growth takes place when a country
produces a steady number of automobiles.
has a high unemployment rate.
measures its gross domestic product.
produces more goods and services.
Which best describes what is represented in the business cycle model?
The interaction between producers and consumers.
The change in production cost.
MACROeconomic trends.
Supply and demand trends.
The term liquidity refers to
how quickly money can be exchanged.
the true monetary value of an investment
The shifting supply of money in the economy
how much wealth an individual has amassed.
Which is an example of a demand account?
savings account
investment account
credit account
checking account
The main role of banks in the nation's economy is to
store, lend, and invest money
store, lend, and borrow money
store, lend, and distribute money
store, lend, and approve money
A plan for spending money that balances income with spending and shows how money will be spent is
a surplus
an expenditure
a budget
a deficit
Governments collect taxes to ensure that
there is sufficient money to fund private businesses.
citizens contribute to meeting society's needs.
politicians get paid in a timely manner.
a government program exists for every need that arises.
What gives the United States government the power to collect taxes?
The Constitution
Laws passed by Congress
An Executive Order
Common Law
Which best describes a central bank's primary role?
controlling inflation
increating credit
printing money
creating monetary policy
Which best describes a central bank's primary goals?
limiting inflation and reducing unemployment
reducing unemployment and maintaing cash flow
controlling stagflation and reducing unemployment
managing credit and ensuring the money supply's liquidity
The most common business organizations in the United States are
partnerships
sole proprietorships
corporations
franchises
An entrepreneur is someone who
starts and runs a business
is an employee of a business
invents products for other businesses.
works for multiple developing businesses.
Which is an example of an income deduction?
an unexpected salary cut
wages lost due to illness
vacation budget
retirement savings
What effect would a tax increase have on income?
It would reduce gross income.
It would not affect net income.
It would increase net income.
It would not affect gross income.
To change gross income, someone would need to
save more per month
reduce deductions
earn more money
increase withholdings.
A short-term financial goal might include saving for
a down-payment on a house
a piece of furniture
a child's college fund
one's retirement
Paying for transportation to and from work is an example of
a variable expense
a fixed expenses
a short-term expense
a discretionary expense
What is most likely the reason variable expenses should be planned after fixed expenses?
Fixed expenses are deducted from gross income. Variable expenses come from net income.
Variable expenses are a necessary part of fixed expenses but can be calculated after fixed expenses.
Variable expenses are almost always higher than fixed expenses and need a greater budget.
Fixed expenses are required and constant, but variable expenses are more flexible.
When a person invests income, her or she
spends no money in the short-term and saves it all for the long-term.
uses money in a way that will increase its value in the future.
spends income only on essential needs such as housing.
cuts out all discretionary spending for a set period of time to save money.
From what part of income should someone take savings?
what otherwise would be fixed expenses
gross income, before other deductions
what otherwise would be discretionary income
gross income, along with other deductions
Which is the best way to achieve long-term financial goals?
Spend less on mandatory expenses
Eliminate short-term financial goals
Increase discretionary expenditures
Save more money from net income
When should fixed and variable monthly budgeted expenses first be planned?
at the end of each month
day by day during the month
at the start of each month
at least twice per month
In order to stay on track for long term financial goals, money for emergency spending should be taken first from your
savings account.
discretionary money.
fixed expense money.
net income.
Why might variable expenses change a great deal at different times of year?
Heating and cooling costs might vary considerably.
Income taxes and withholdings may increase or decrease.
Car loan payments become higher in certain seasons.
Discretionary spending may rise when fixed expenses rise.
To create a balanced budget, one must make sure to
spend as little as possible.
pay credit card payments first.
spend less than or equal to income.
pay off debts first.
Why is net income lower than gross income?
fixed spending
budgets
withholdings or deductions
discretionary spending
When creating a budget, log fixed expenses
before income.
after income.
after savings.
at the top.
An expense that is constant each month is called __ expense.
variable
fixed
uncertain
When creating a budget, you must track both your budgeted expenses and your __ expenses.
actual
potential
likely
How is a savings account most useful?
for saving for a long time without withdrawing
for depositing and withdrawing money frequently
for using money for CDs and other investments
for using money in the near future but not right away.
