WorksheetsEconomics - Unit 3
Total questions: 70
Worksheet time: 53mins
Common goods are:
Non rival, excludable
Non rival, non excludable
rival, excludable
rival, non excludable
What is an example of tragedy of the commons?
Overfishing
Housing prices going up
Unemployment
Not enough spots for kids in a private school
What is the free rider problem?
scarcity even when you pay for a good
Reaping all the benefits without contributing
Common goods that don't have a price
none of the above
What statement best explains why the government provides goods and services to its citizens?
To provide benefits to small groups of people in certain areas of the country.
To provide goods and services that would not be available if individuals had to provide them.
To compete with businesses in the private sector.
To make a large profit by providing certain goods and services to it's citizens.
The government pays for public goods and services through —
donations from wealthy politicians
donations from foreign nations
revenue from sales and income taxes
revenue from the lottery
The United States government provides the following services EXCEPT —
interstate highways
satellite radio
postal service
national defense
What is one reason that local law enforcement is considered a public good?
Everyone in the community benefits from it.
Nobody in the community has to pay for it.
Private firms make a profit from producing it.
Individual citizens pay directly for it.
Which of the following is an example of a positive externality resulting from an outdoor band concert?
An elderly woman in her apartment hears a song that she liked as a child.
A pair of endangered birds leave their nest in a nearby tree when the concert starts.
A pizza parlor closes early, because all of its customers are at the concert.
A traffic jam occurs as drivers hunt for parking spots near the concert.
The goal of government welfare programs is to
maintain a poverty threshold that matches the median income.
eliminate the dependence of people on the welfare system.
eliminate the income gap between the richest Americans and the poorest.
raise the standard of living of certain less-fortunate members of society.
Which of the following explains why a city fireworks display on the Fourth of July is provided as a public good?
Fireworks displays usually take place in a public area.
Fireworks are a scarce resource.
Nonpayers cannot be prevented from seeing the fireworks.
Each consumer pays a fee to see the fireworks.
The part of the economy that involves the transactions of the government.
Private sector
Free rider
Public sector
Externality
The part of the economy that involves the transactions of individuals and businesses.
Public sector
Externality
Private sector
Public good
Is a situation in which the market, on its own, does not distribute resources efficiently.
Public good
Private sector
Externality
Market Failure
An Economic side effect of a good or service that generates benefits or costs to someone other than the person deciding how much to produce or consume.
Public good
Free rider
Externalities
Private sector
Some decisions to produce goods and services generate unintended costs, called......
positive externalities
Negative private sector
Negative externalities
Positive private sector
Which of the following is an example of a negative externality resulting from an outdoor concert in the park?
College students near by get to enjoy free entertainment
An elderly woman in her apartment hears a song that she liked as a child.
A pizza parlor stays open later and makes a bigger profit than most nights
A traffic jam occurs as drivers hunt for parking spots near the concert.
What might be the economic benefit of the government providing a public good rather than the private sector?
decreased prices for the good
decreased cost for the good
increased taxes needed to provide the good
greater efficiency in providing the good
Market failure occurs whenever
free markets fail to distribute resources efficiently.
goods fail to arrive at a market in a timely fashion.
government builds infrastructure.
voluntary exchange in a market fails to result in a sale.
Why do U.S. economic policies seek to achieve the goal of maximum employment?
High employment is a signal to producers to lower prices on goods and services.
The Constitution guarantees a job to Americans who are willing and able to work
When more people work, the economy is more productive and the standard of living rises
The more people who are employed, the more secure the financial markets will be.
When stock prices decrease as investors fear their ability to make a profit
Bull Market
Bear Market
Shares Market
When stock prices increase steadily as investors anticipate their ability to earn a profit
Bull Market
Bear Market
Dividends
Liquidity
Which of these forms of borrowing is usually used to buy property.
Personal Loan
Mortgage
Payday Loan
Credit card
The bank will take possession of your car if you .... your car loan.
pay off
default on
endorse
compute
The amount of money that the lender lends to the borrower is called ....
principal
tenure
default
collateral
A type of investment that invests in a lot of different companies is called
Stocks
Bonds
Mutual funds
T-bills
Spreading your investments around to inrease financial security
Risk assessment
Diversification
Stocks, bonds & cash
Liquidity trap
The production of fiat money is mostly controlled by
citizens
government
rich people
Economists use the definition: "A compulsory contribution to State Revenue" for which of the words below?
Subsidy
Tax
Extortion
Supply
Economists use the definition: "A sum of money granted by the government to assist an industry" for which of the words below?
Subsidy
Tax
Extortion
Supply
A pair of shoes that costs $80 last month costs $100 this month. Which of the following BEST describes this economic condition?
inflation
recession
The percentage of a deposit that a bank must hold on to is called the ______.
Reserve Requirement
Credit
It is the study of the nations economy as a whole.
Microeconomics
National economy
National output
Macroeconomics
It is the decrease in the general level of prices of basic commodities.
Inflation
Deflation
Stagflation
Stagnation
How does a government-funded construction project stimulate spending?
By requiring construction workers to buy equipment
By providing construction workers with regular income
By selling leftover materials to construction workers
By creating homes for construction workers to rent
Which of the following typically rises during a recession?
Unemployment
Average income
Production
Stock prices
1. What was one thing that caused the great recession?
A. Banks had sold too many mortgage-backed securities than what could be supported by good mortgages.
B. Not enough Houses
C. Banks did not sell enough mortgage backed securities.
what is the purpose of Monetary Policy?
contribute to economic growth and stability
keep rich people from getting too rich
Functions like Fiscal Policy
give Congress and the political parties more control of the economy
During a recession, the Fed should use...
an expansionary policy
a contractionary policy
During an era of economic expansion (likely leading to inflation), the Fed should use...
an expansionary policy
a contractionary policy
Business has never been better for Danny, owner of U2CanOwnAUsedCar Co. In fact, two months after the country was officially declared to be in a recession, he needed to hire another salesperson because of increased sales. He had no problem finding help: over fifty out-of-work new car salespeople sent in resumes in response to Danny’s ad in the Sunday classified.
Structural unemployment
Seasonal Unemployment
Frictional Unemployment
Cyclical Unemployment
Andy is a not-so-typical househusband who has spent the past fifteen years raising their boys Aidan, Caleb, and Hudson. Andy and his wife, Colleen, have agreed that the kids are old enough to take care of themselves and that Andy should start job hunting. Andy has some prior experience working as a pinball repairman.
Structural unemployment
Seasonal Unemployment
Frictional Unemployment
Cyclical Unemployment
Pieter, formerly a foreman at Mittal Steel, inc., has been out of work now for ten months. He became expendable the day MS, Inc. installed an industrial robot named Hans. Hans can do the work of twenty, needs no coffee breaks, makes no personal phone calls, seldom gets sick, and never insists on better working conditions.
Structural unemployment
Seasonal Unemployment
Frictional Unemployment
Cyclical Unemployment
Yevgeny Petrovich is an experienced bricklayer. He recently moved with his family to Odessa. The reason for the move? Yevgeny found steady work in his hometown of St. Petersburg from mid-April through October, but jobs became quite scarce the remaining months. He hopes the work will be more steady in Odessa.
Structural unemployment
Seasonal Unemployment
Frictional Unemployment
Cyclical Unemployment
Most countries try to maintain an inflation rate of ______ per year.
One percent or less
Two to three percent
Four to five percent
Six to seven percent
Which of the following causes of inflation is often described as “too much money chasing too few goods”?
Demand-pull inflation
Cost-push inflation
Demand-push inflation
Cost-pull inflation
The prices by which rising wages cause higher prices, and higher prices cause higher wages
Consumer Price Index
Inflation rate
Hyperinflation
Quantity theory
Wage-price spiral
The United States national debt is
the amount of money owed by the federal government to United States citizens
the amount of money owed by the federal government to other United States government agencies
the amount of currency in the hands of foreigners
the amount of money owed by state and local governments to United States citizens
the amount of money owed to holders of United States government securities
Which of the the following means per person?
percent
per capita
per capital
gross
