Font size
S
M
L
XL
WorksheetsEcon Final Exam Review
Total questions: 118
Worksheet time: 59mins
Name
Class
Date
1.
When a state government chooses to build more roads, the required resources are no longer available for spending on public education. This dilemma illustrates the concept of:
a)
Marginal Analysis
b)
Full employment
c)
Full protection
d)
Opportunity Cost
2.
From an economic perspective, when a student decides to attend another year of college, the student has concluded that the marginal:
a)
Costs of attending college has decreased that year
b)
Benefits of attending college has increased that year
c)
Benefits of attending college are greater than the marginal costs
d)
Costs of attending college will be subsidized by someone else such as parents or the government
3.
In the summer of 2008, the price of oil rose dramatically, which in turn caused the price of natural gas to increase. This can best be explained by saying that oil and natural gas are:
a)
complementary goods and the higher price for oil increased the demand for natural gas.
b)
substitute goods and the higher price for oil increased the demand for natural gas.
c)
complementary goods and the higher price for oil decreased the supply of natural gas.
d)
substitute goods and the higher price for oil decreased the supply of natural gas.
4.
In deciding whether to study for an economics quiz or go to a movie, one is confronted by the idea(s) of:
a)
scarcity and opportunity costs
b)
money and real capital
c)
complementary economic goals
d)
full protection
5.
The value of the best alternative to any action you undertake is referred to as its:
a)
Production cost
b)
Opportunity cost
c)
Resource cost
d)
Increasing cost
6.
In a mixed economy, what to produce and how much to produce are determined by
a)
A central planning agency
b)
a private planning agency
c)
Markets and the government
d)
Large corporations and small entrepreneurs
7.
If the government imposes a tax on the production of cars, which of the following will occur in the market for cars?
a)
There will be a movement to the right along the supply curve.
b)
There will be a movement to the right along the demand curve.
c)
The supply curve will shift to the right.
d)
The supply curve will shift to the left.
e)
The demand curve will shift to the right.
8.
Which of the following is true of a price floor?
a)
To have an impact in the market for the good, the price floor should be set below the existing market price of the good.
b)
An effective price floor will increase the quantity demanded of the good.
c)
The price floor would tend to create a shortage of the good in the market.
d)
The creation of the price floor would not change the quantity supplied of the good if the supply curve were upward sloping
e)
The intention of the government in creating a price floor is to assist the producers of the good.
9.
Which is consistent with the law of demand?
a)
An increase in the price of ice cream causes an increase in the quantity of ice cream demanded
b)
A decrease in the price of bagels causes an increase in the quantity of bagels demanded
c)
A decrease in the price of muffins causes a decrease in the quantity of muffins demanded
d)
An increase in the price of candy bars causes no change in the quantity of candy bars demanded
10.
Refer to the figure. If box B represents the resource market and flow (3) represents money income, then:
a)
Box A is the product market and box C is households
b)
Box C is the product market and box A is households
c)
Box D is the product market and box C is households
d)
Box C is the product market and box D is households
11.
Which best describes the "invisible hand" concept?
a)
Sufficiently detailed central direction of an economy will maximize the public's best interests
b)
The market system works best when resources are highly substitutable
c)
The problem of scarcity can best be overcome in a system of mixed capitalism
d)
The desires of producers and resource suppliers to further their own self-interest will automatically promote the social interest
12.
In the market system, the least costly techniques of production will be chosen by competitive firms because:
a)
Of consumer sovereignty
b)
Of the law of diminishing returns
c)
Profits will be highest with such techniques
d)
These techniques will result in full employment
13.
The economy of North Korea would best be classified as:
a)
A laissez-faire economy
b)
A command economy
c)
A capitalist economy
d)
A market system
14.
Which statement best describes a command economy?
a)
The production of goods and services is determined primarily by markets, but the allocation of goods and services is determined primarily by government
b)
The production of goods and services is determined primarily by government, but the allocation of goods and services is determined primarily by markets
c)
The production and allocation of goods and services is determined primarily through markets
d)
The production and allocation of goods and services is determined primarily through government
15.
The market system is an economic system that:
a)
Produces more consumer goods than capital goods
b)
Produces more capital goods than consumer goods
c)
Gives private individuals and institutions the right to own resources used in production
d)
Gives the government the right to tax individuals and corporations for the production of capital goods
16.
Which will not cause a change of the demand for product A?
a)
A change in consumer preferences
b)
A change in the price of A
c)
A decline in consumer incomes
d)
A decrease in the price of close-substitute product B
17.
Refer to the diagram, which shows three demand curves for coffee. Which would cause the change in the demand for coffee illustrated by the shift from D1 to D2?
a)
A decrease in the price of tea
b)
An increase in consumer incomes
c)
An increase in the price of sugar
d)
A technological improvement in the production of coffee
18.
If the price of hamburger buns increases, the demand for ground beef is predicted to:
a)
Increase
b)
Decrease
c)
Remain constant
d)
Shift to the right
19.
Refer to the graph. An increase in the quantity demanded would best be reflected by a change from:
a)
Point 6 to 4
b)
Point 6 to 3
c)
Line A to B
d)
Line A to C
20.
Which statement is true?
a)
There is an inverse relationship between product price and quantity supplied
b)
There is some price at which quantity supplied of a product is negative
c)
As product price decreases, producers are willing to put more of the good on the market for sale
d)
To entice producers to offer more of a product on the market for sale, product price must rise
21.
Suppose that a more efficient way to produce a good is discovered, thus lowering production costs for the good. This will cause a(n):
a)
Increase in supply, or a rightward shift of the supply curve
b)
Decrease in supply, or a leftward shift of the supply curve
c)
Increase in quantity supplied, or movement down the supply curve
d)
Decrease in quantity supplied, or movement up the supply curve
22.
There is a shortage in a market for a product when:
a)
The increase in supply is greater than the increase in demand
b)
The increase in demand is greater than the increase in supply
c)
Quantity demanded is less than quantity supplied
d)
Quantity demanded is greater than quantity supplied
23.
A leftward shift of the supply curve for oil in the United States is most likely to result from:
a)
A decrease in the price which oil companies must pay for drilling licenses
b)
An increase in the costs of exploration and drilling for oil
c)
Opening of new areas for oil exploration in the United States
d)
A decrease in the world price of oil
24.
Refer to the diagram illustrating the market for corn. The equilibrium price and quantity in this market are:
a)
$4 and 10,000 bushels
b)
$3 and 8,000 bushels
c)
$2 and 4,000 bushels
d)
$2 and 11,000 bushels
25.
Refer to the diagram illustrating the market for corn. If the price in this market were to be fixed at $4 per bushel, the part of the line marked A would represent a:
a)
Surplus of 8,000 bushels
b)
Shortage of 8,000 bushels
c)
Surplus of 7,000 bushels
d)
Shortage of 7,000 bushels
26.
Select the graph that best shows the change to demand or supply in a particular market given the following situation: In the market for gasoline, the price of oil, which is used to produce gasoline, increases because of lower production quotas are set by major oil-producing nations.
a)
Graph A
b)
Graph B
c)
Graph C
d)
Graph D
27.
Refer to the graph, which shows the supply and demand for rental housing in a city. If the supply of housing is given by S1and the demand for housing is given by D1, then in a competitive market for housing the rental price would be:
a)
P4 and the equilibrium quantity would be at point b
b)
P3 and the equilibrium quantity would be at point c
c)
P2 and the equilibrium quantity would be at point e
d)
P1 and the equilibrium quantity would be at point g
28.
The price elasticity of demand is a measure of the:
a)
Steepness or slope of a demand curve
b)
Absolute changes in quantity demanded and price
c)
Responsiveness of quantity demanded to a change in price
d)
Sensitivity of the quantity demanded for one good to a change in the price of another good
29.
If a business decreased the price of its product from $10 to $9 when the demand for the product was inelastic, then total revenues would:
a)
Decrease
b)
Increase
c)
Remain unchanged
d)
Be perfectly inelastic
30.
The law of diminishing returns for a manufacturing plant of a fixed size implies that, eventually employing one:
a)
More worker will increase output per worker
b)
More worker will decrease output per worker
c)
Less worker will increase output per worker
d)
Less worker will not affect output per worker
31.
There is no control over price by firms in:
a)
Oligopoly
b)
Pure monopoly
c)
Pure Competition
d)
Monopolistic Competition
32.
Pure monopoly means:
a)
any market in which the demand curve to the firm is downsloping.
b)
a standardized product being produced by many firms.
c)
a single firm producing a product for which there are no close substitutes.
d)
a large number of firms producing a differentiated product.
33.
Which of the following is correct?
a)
Both purely competitive and monopolistic firms are "price takers."
b)
Both purely competitive and monopolistic firms are "price makers."
c)
A purely competitive firm is a "price taker," while a monopolist is a "price maker."
d)
A purely competitive firm is a "price maker," while a monopolist is a "price taker."
34.
Under monopolistic competition entry to the industry is:
a)
completely free of barriers.
b)
more difficult than under pure competition but not nearly as difficult as under pure monopoly.
c)
more difficult than under pure monopoly.
d)
blocked
35.
Nonprice competition refers to:
a)
Low barriers to entry
b)
product development, advertising, and product packaging
c)
the differences in information which consumers have regarding various products
d)
an industry or firm in long-run equilibrium
36.
What is your name?
4 lines
37.
The difference between representative money and fiat money is that
a)
representative money is worth more than fiat money
b)
fiat money is more durable than representative money
c)
fiat money is counted in coins; representative money is counted in paper dollars
d)
representative money is backed by silver or gold; fiat money is not
38.
What effect does inflation have on the purchasing power of money?
a)
Causes it to go down
b)
None
c)
Causes it to go up
d)
The effect varies depending on the time and place.
39.
Which of the following is NOT a characteristic of money?
a)
Divisibility
b)
Acceptability
c)
Portability
d)
Responsibility
40.
Currently, what is U.S. money backed by?
a)
Frankincense
b)
Silver
c)
Gold
d)
Trust that it is worth something
41.
This is money that has a another useful purpose.
a)
fiat
b)
debt
c)
commodity
d)
securities
42.
A student who just graduated from college and is waiting to start their new job is
a)
seasonally unemployed
b)
structurally unemployed
c)
frictionally unemployed
d)
cyclically unemployed
43.
A woman who lost her job due to a decrease in sales during a recession in the economy is
a)
seasonally unemployed
b)
structurally unemployed
c)
frictionally unemployed
d)
cyclically unemployed
44.
The mall Santa who lost their job because it is January is
a)
seasonally unemployed
b)
structurally unemployed
c)
frictionally unemployed
d)
cyclically unemployed
45.
Which of the following best defines unemployment?
a)
The state of being able to work, actively seeking work, but unable to find employment.
b)
Anyone who does not have a job
c)
Someone under 16 who works at a family owned business
d)
Someone who works only 4 hours a week but wants to work more.
46.
A healthy (but lazy) 28 year old man who lives in his mom's basement, does not have a job, and only plays video games is considered to be
a)
Employed
b)
Unemployed
c)
Not in the labor force
d)
In the labor force
47.
A 35 year old project manager was let go because his employer went bankrupt. He's applied for several similar jobs but hasn't heard back as of yet. He is considered to be
a)
Employed
b)
Unemployed
c)
Not in the labor force
d)
In the labor force
48.
Which of these people is officially unemployed?
a)
A secretary who took 6 months off for maternity leave
b)
A maid who got fired and will start a new job in 2 weeks.
c)
An aspiring actress who waits tables but would rather act
d)
A high school student who works at thier parents restaurant but does not get paid.
49.
Which is an example of an intermediate good?
a)
The purchase of leather to make shoes
b)
the purchase of a new radio for your car
c)
the purchase of a new car
d)
the purchase of a new lawn mower
50.
The single best measure of the overall performance of the American economy and our standard of living is...
a)
GNP
b)
Real GDP
c)
Nominal GDP
d)
Misery Index
51.
Nominal GDP is the current dollar value of the nation's output with no adjustment for inflation.
a)
True
b)
False
52.
Frictional unemployment is...
a)
When the worker's skills do not match the jobs available in the economy.
b)
When the worker is in between jobs
c)
When the worker is unemployed due to natural movement in the business cycle
d)
When a worker is unemployed due to times of the year
53.
Cyclical unemployment is...
a)
When the worker's skills do not match the jobs available in the economy.
b)
When the worker is in between jobs
c)
When the worker is unemployed due to natural movement in the business cycle
d)
When a worker is unemployed due to times of the year
54.
Structural unemployment is...
a)
When the worker's skills do not match the jobs available in the economy.
b)
When the worker is in between jobs
c)
When the worker is unemployed due to natural movement in the business cycle
d)
When a worker is unemployed due to times of the year
55.
Seasonal unemployment is...
a)
When the worker's skills do not match the jobs available in the economy.
b)
When the worker is in between jobs
c)
When the worker is unemployed due to natural movement in the business cycle
d)
When a worker is unemployed due to times of the year
56.
"Too many dollars chasing too few goods" describes...
a)
The need to print more dollars
b)
cost-push inflation
c)
demand-pull inflation
d)
deflation
e)
stagflation
57.
The combination of inflation and unemployment describes...
a)
The need to print more dollars
b)
cost-push inflation
c)
demand-pull inflation
d)
deflation
e)
stagflation
58.
When overall prices increase due to increases in the costs of production describes...
a)
The need to print more dollars
b)
cost-push inflation
c)
demand-pull inflation
d)
deflation
e)
stagflation
59.
In the event of inflation, a retired social worker with a fixed pension would not be hurt.
a)
True
b)
False
60.
Inflation means...
a)
The economy is rising
b)
The price of a good has increased
c)
The general level of prices has increased
d)
The economy is performing well
61.
Full employment is considered reached when the unemployment rate is around...
a)
0% - 3%
b)
4% - 6%
c)
7% - 10%
d)
10% - 15%
e)
97% - 100%
62.
An increase in business confidence will cause what change?
a)
Increase in AD
b)
Decrease in AD
c)
Increased AS
d)
Decreased AS
63.
An increase in worker productivity will cause what change?
a)
Increase in AD
b)
Decrease in AD
c)
Increased AS
d)
Decreased AS
64.
An increase in oil prices will cause what change?
a)
Increase in AD
b)
Decrease in AD
c)
Increased AS
d)
Decreased AS
65.
Why does an increase in the minimum wage cause the quantity demanded for labor to fall?
a)
Producers don't require as many workers
b)
Producers are less willing and able to employ as many workers as their costs of production has increased
c)
Less people are willing to work
d)
Less people are able to work
66.
What is poverty?
a)
When you don't have money
b)
When your basic needs are not met
c)
When you can't buy that new TV.
d)
When you don't have a job
67.
Properly label A on the image.
(a)
68.
Properly label B on the image.
(a)
69.
Properly label C on the image.
(a)
70.
Properly label D on the image.
(a)
71.
Properly label E on the image.
(a)
72.
Properly label F on the image.
(a)
73.
Properly label G on the image.
(a)
74.
What is your name?
4 lines
75.
The difference between representative money and fiat money is that
a)
representative money is worth more than fiat money
b)
fiat money is more durable than representative money
c)
fiat money is counted in coins; representative money is counted in paper dollars
d)
representative money is backed by silver or gold; fiat money is not
76.
What effect does inflation have on the purchasing power of money?
a)
Causes it to go down
b)
None
c)
Causes it to go up
d)
The effect varies depending on the time and place.
77.
Which of the following is NOT a characteristic of money?
a)
Divisibility
b)
Acceptability
c)
Portability
d)
Responsibility
78.
Currently, what is U.S. money backed by?
a)
Frankincense
b)
Silver
c)
Gold
d)
Trust that it is worth something
79.
This is money that has a another useful purpose.
a)
fiat
b)
debt
c)
commodity
d)
securities
80.
A student who just graduated from college and is waiting to start their new job is
a)
seasonally unemployed
b)
structurally unemployed
c)
frictionally unemployed
d)
cyclically unemployed
81.
A woman who lost her job due to a decrease in sales during a recession in the economy is
a)
seasonally unemployed
b)
structurally unemployed
c)
frictionally unemployed
d)
cyclically unemployed
82.
The mall Santa who lost their job because it is January is
a)
seasonally unemployed
b)
structurally unemployed
c)
frictionally unemployed
d)
cyclically unemployed
83.
Which of the following best defines unemployment?
a)
The state of being able to work, actively seeking work, but unable to find employment.
b)
Anyone who does not have a job
c)
Someone under 16 who works at a family owned business
d)
Someone who works only 4 hours a week but wants to work more.
84.
A healthy (but lazy) 28 year old man who lives in his mom's basement, does not have a job, and only plays video games is considered to be
a)
Employed
b)
Unemployed
c)
Not in the labor force
d)
In the labor force
85.
A 35 year old project manager was let go because his employer went bankrupt. He's applied for several similar jobs but hasn't heard back as of yet. He is considered to be
a)
Employed
b)
Unemployed
c)
Not in the labor force
d)
In the labor force
86.
Which of these people is officially unemployed?
a)
A secretary who took 6 months off for maternity leave
b)
A maid who got fired and will start a new job in 2 weeks.
c)
An aspiring actress who waits tables but would rather act
d)
A high school student who works at thier parents restaurant but does not get paid.
87.
Fiscal Policy is controlled by
a)
The states
b)
The government
c)
The Federal Reserve System
d)
The Department of Commerce
88.
The two "tools" of Fiscal Policy are
a)
raising and lowering taxes
b)
borrowing money
c)
printing money
d)
raising and lowering interest rates
89.
Taxing and spending to help the economy grow is referred to as
a)
expansionary monetary policy
b)
contractionary monetary policy
c)
expansionary fiscal policy
d)
contractionary fiscal policy
90.
Taxing and spending to slow the economy is referred to as
a)
expansionary monetary policy
b)
contractionary monetary policy
c)
expansionary fiscal policy
d)
contractionary fiscal policy
91.
When the economy is above the trend and is seeing high levels of inflation, the federal government should practice
a)
expansionary fiscal policy
b)
contractionary fiscal policy
92.
When the economy is below the trend and is seeing high levels of unemployment, the federal government should practice
a)
expansionary fiscal policy
b)
contractionary fiscal policy
93.
An example of expansionary fiscal policy would be
a)
cutting production of consumer goods
b)
cutting taxes
c)
cutting government spending
d)
increasing taxes
94.
When the government raises taxes, what does it take out of circulation?
a)
People
b)
Credit
c)
Jobs
d)
Money
95.
What is your name?
4 lines
96.
Which of the following are true statements. (Click ALL that apply) Money...
a)
is a medium of exchange
b)
serves as a store of value
c)
is backed by gold in Fort Knox
d)
is a unit of account
97.
Which of the following is an example of a barter system?
a)
Instead of paying rent, you clean the house for the owner.
b)
Instead of paying cash for a computer, you use a credit card.
c)
Instead of paying the full amount for a car, you pay 10 percent in cash and pay for the rest in monthly installments.
d)
Instead of paying for a purchase in Mexico in pesos, you use dollars from the United States.
98.
Which of the following is an example of representative money?
a)
a fur coat
b)
diamonds
c)
gold earings
d)
an IOU note
99.
What is a mortgage used to purchase?
a)
car
b)
real estate
c)
college tuition
d)
stocks and bonds
100.
Which of the following is NOT an example of a liquid asset?
a)
cash
b)
traveler's checks
c)
a certificate of deposit
d)
a checking account
101.
What happens during a bank run?
a)
The government orders a bank to close
b)
States charter more banks than needed
c)
The price of gold held by banks suddenly increases
d)
more customers withdraw money than the bank has on hand
102.
What condition is necessary for a fiat money system to work?
a)
Money owed must be paid on time.
b)
The government must control the money supply.
c)
Banks must hold sufficient gold to cover any paper money they give out.
d)
Customers with checking accounts cannot earn interest on those accounts.
103.
What happens when you make a purchase using a credit card?
a)
The credit card issuer pays the store.
b)
The money is immediately deducted from your account.
c)
The amount of the purchase is deducted from a prepaid account.
d)
The place where you made the purchase pays the money to your bank within 24 hours.
104.
What is the largest source of income for banks?
a)
the interest they receive from loans
b)
fees charged to customers for accounts
c)
money deposited in savings accounts
d)
special accounts such as NOW accounts
105.
Penny is an artist, and John is a carpenter. Penny agrees to paint a portrait of John’s family in exchange for a handmade table created by John. How did Penny and John pay for the goods in their transaction?
a)
using a store of value
b)
with money
c)
through bartering
d)
with currency
106.
In the 1990s, the Russian people lost confidence in the value of the ruble, and many were no longer willing to sell goods and services in exchange for Russian currency. Which characteristic of money did the Russian currency lack?
a)
acceptability
b)
uniformity
c)
limited supply
d)
durability
107.
Money that has value because the government has ordered that it is an acceptable means to pay debts
a)
fiat money
b)
currency
c)
commodity money
d)
Federal Reserve System
e)
interest
108.
The central banking system of the United States
a)
Federal Reserve System
b)
currency
c)
commodity money
d)
fiat money
e)
interest
109.
The amount of money borrowed
a)
principal
b)
currency
c)
commodity money
d)
Federal Reserve System
e)
fiat money
110.
Coins and paper bills used as money is
a)
currency
b)
commodity money
c)
Federal Reserve System
d)
fiat money
e)
interest
111.
The price paid for the use of borrowed money
a)
interest
b)
currency
c)
commodity money
d)
Federal Reserve System
e)
fiat money
112.
Objects that have value in themselves and that are also used as money
a)
commodity money
b)
currency
c)
Federal Reserve System
d)
fiat money
e)
interest
113.
Money pooled from small investors and used to purchase government or corporate bonds
a)
money market mutual fund
b)
currency
c)
commodity money
d)
Federal Reserve System
e)
fiat money
114.
A specific type of loan that is used to buy real estate
a)
fractional reserve banking
b)
currency
c)
mortgage
d)
interest
e)
representative money
115.
coins and paper bills used as money
a)
fractional reserve banking
b)
currency
c)
mortgage
d)
interest
e)
representative money
116.
the price paid for the used of borrowed money
a)
fractional reserve banking
b)
currency
c)
mortgage
d)
interest
e)
representative money
117.
a system that keeps only a fraction of funds on hand and lends out the remainder
a)
fractional reserve banking
b)
currency
c)
mortgage
d)
interest
e)
representative money
118.
objects that have value because the holder can exchange them for something else of value
a)
fractional reserve banking
b)
currency
c)
mortgage
d)
interest
e)
representative money
Reset
