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WorksheetsFA23_Economics and Personal Finance Review
Total questions: 121
Worksheet time: 2hrs 33mins
What is the economic concept that refers to the value of the next best alternative when a decision is made?
opportunity cost
Fixed cost
Sunk cost
Marginal cost
Which subtopic of economics deals with the study of individual consumer and producer behavior?
Astrophysics
Microeconomics
Macroeconomics
Botany
What is the term used to describe the study of the overall economy, including topics such as inflation, unemployment, and economic growth?
microeconomics
nanoeconomics
macroeconomics
mesoeconomics
In economics, what is the term used to describe the relationship between the quantity of a good that producers are willing to sell and the price of the good?
Demand curve
Price curve
Supply curve
Cost curve
What is the term used to describe the study of how individuals and societies make choices about the use of scarce resources?
sociology
economics
psychology
biology
Which subtopic of economics focuses on the financial decisions and activities of an individual or household?
Macroeconomics
Microeconomics
Environmental economics
International economics
What is the term used to describe the cost of forgoing the next best alternative when making a decision?
opportunity cost
fixed cost
marginal cost
sunk cost
In economics, what is the term used to describe the total amount of a good or service that consumers are willing and able to purchase at a given price?
equilibrium
scarcity
demand
supply
Which subtopic of economics deals with the overall performance and behavior of the economy as a whole?
Microeconomics
Macroeconomics
Astroeconomics
Psychroeconomics
What is the term used to describe the process of analyzing and evaluating the costs and benefits of an action or decision?
Cost-benefit analysis
Cost-effectiveness review
Expense-profit assessment
Price-value comparison
What is the term used to describe the policy employed by a central bank to control the supply of money in an economy?
Fiscal policy
Monetary policy
Trade policy
Foreign policy
Which tool of monetary policy involves the buying and selling of government bonds to regulate the money supply?
Open market operations
Reserve requirements
Discount rate
Interest rate targeting
What is the effect of an expansionary monetary policy on the interest rates?
Increases interest rates
Decreases interest rates
No effect on interest rates
Interest rates become negative
Who is responsible for making fiscal policy decisions?
The Federal Open Market Committee
Which of the following would stimulate the economy? Choose all that apply!
Decrease taxes
Raise taxes
Government spends more on Science research
Government cuts organizations like the National Science Foundation
The headline below indicates which type of policy:
"Fed unleashes another big rate hike in bid to curb inflation"
Fiscal policy
Monetary policy
Monetary policy decisions are made by:
Congress
Senate
The Fed
President
Taxing and Spending are tools of
fiscal policy
monetary policy
Is a joint effort between the executive and legislative branches
fiscal policy
monetary policy
In order to help the economy grow, the government will decrease or lower taxes. This allows people to have more money and buy more goods and services.
fiscal policy
monetary policy
What can the government do to slow the economy in order to reduce inflation?
lower taxes
raise taxes
spend more
To help the economy grow, the government can
increase spending
decrease spending
lower the minimum wage
raise taxes
In order to help the economy grow, the FED may____________the reserve requirement, allowing banks to loan more people money so that they spend more
lower
raise
ignore
end
The amount that all banks have to keep in the reserve and they can't loan out to people
monetary lending
fiscal spending
reserve requirement
lending policy
The interest rate the FED charges banks to borrow money will be lowered to help the economy grow and raised to slow the economy
reserve requirement
discount rate
bank rate
monetary bank
cause interest rates to decrease because low interest rates encourage business growth and expansion
cause interest rates to rise because high interest rates encourage business growth and expansion
increase the discount rate it charges banks, which would increase the money supply
increase consumer spending by reducing the money supply
What type of unemployment occurs when advanced technology takes your job?
Frictional
Structural
Seasonal
Cyclical
What type of unemployment is due to a business shutting down for a part of a year?
Frictional
Structural
Seasonal
Cyclical
What type of unemployment occurs during a transition period from one job to another job?
Frictional
Structural
Seasonal
Cyclical
What type of unemployment occurs when there is a decline in business activity resulting in layoffs?
Frictional
Structural
Seasonal
Cyclical
Which of the following is NOT a form of unemployment?
underemployment
long-term unemployment
frictional unemployment
structural unemployment
Which of the following best defines unemployment?
The state of being able to work and actively seeking work, but unable to find employment
The state of being able to work, but choosing not to
The percentage of the labour force that is able and actively seeking work, but cannot find employment
The total number of people who do not work
The unemployment rate will drop if
A person is hired into a new job
Someone who was previously laid off is rehired
An unemployed person stops looking
ALL of these answers are CORRECT
Inflation is most likely to occur during which phase of the business cycle
Expansion
Contraction
Inflation can best be defined as...
A general increase in prices.
An increase in prices of key items purchased by consumers.
The increase in the value of fiat money
The printing of too much paper money.
Because of scarcity, people are forced to make _________ about how to use resources.
Choices
Opportunities
Houses
Desires
These are the things we desire to have.
Wants
Goals
Opportunity Costs
The opportunity cost of a good is
its price in dollars and cents.
the alternative goods forgone.
the price of alternative goods foregone.
none of the other options
Amber was shopping at the mall. She had $80 to spend. She found three items she liked: $75 for a pair of shoes, $70 for a jacket, and $62 for a dress. After shopping for a couple hours, she decided to borrow a pair of shoes from her cousin and to buy the jacket for $70. What was her opportunity cost?
Shoes
Jacket
Dress
Purse
Football fans and sport commentators frequently argue over the strategies professional football teams use in drafting players. Some teams are looking for a player for a specific position, and when their turn comes, they draft the best available player at that position. Other teams simply draft the best player available regardless of position. These teams argue that by selecting the best possible player regardless of position, they can trade the player they draft now for a better player than they could draft for the desired position later.
What is the MOST scarce resource that professional teams have in the drafting process?
draft positions
the trades
the best players
money
In economics, when discussing the factors of production, the term land refers to
farmland.
real estate.
capital goods.
all natural resources.
Land includes...
The "gifts of nature" or natural resources not created by human effort.
the tools, equipment, and factories used in production of goods and services
people with all their efforts and abilities
individuals who start a new business or bring a product to market.
Capital refers to...
The "gifts of nature" or natural resources not created by human effort.
people with all their efforts and abilities
the tools, equipment, and factories used in production of goods and services
individuals who start a new business or bring a product to market.
Labor refers to...
people with all their efforts and abilities
individuals who start a new business or bring a product to market.
the tools, equipment, and factories used in production of goods and services.
The "gifts of nature" or natural resources not created by human effort.
Entrepreneurs are...
people with all their efforts and abilities
individuals who start a new business or bring a product to market.
The "gifts of nature" or natural resources not created by human effort.
the tools, equipment, and factories used in production of goods and services
Bill Gates is an example of...
Land
Labor
An Entrepreneurs
Capital
Which statement describes the law of demand?
As prices rise, quantity demanded decreases
As prices rise, demand decreases.
As prices fall, quantity demanded decreases.
As prices fall, demand decreases.
Which explains why a supply line is upward sloping?
the Law of Demand states there is an indirect relationship between price and quantity
the Law of Supply states there is a direct relationship between price and quantity
the Law of Supply compares marginal costs and marginal benefits in a constant rate
the Law of Demand shows a positive relationship between two goods, creating the slope
Which is an example of the Law of Demand at work?
The price of the pizza goes up when the price of cheese goes up.
Demand for pizza goes down when tacos become more popular
The price of pizza falls when the demand for pizza falls
Demand for pizza rises when the price of pizza falls
What causes a shift in the demand curve?
A decrease in price
An increase in price
A change in an area other than price
A change in price and availability
The amount of a good or service that producers are willing and able to sell at all possible prices during a given period of time.
Supply
Demand
Factor of Production
Production
The market equilibrium price is the price at which
surpluses depress the number of goods supplied
shortages and surpluses will have no effect on the market
the government will not intervene in the market
the quantity demanded is the same as the quantity supplied
What is the Equilibrium Price?
1
2
3
4
When there is a shortage the price will usually?
rise
fall
remain the same
equilibrium
The diagram represents a(n)
increase in supply
decrease in supply
change in quantity supplied
none of the above
The diagram represents a
increase in demand
decrease in demand
change in quantity demand
none of the above
How would you describe the relationship of supply and demand at this price?
Demand exceeds supply
Supply exceeds demand
Supply equals demand
Demand equals supply
An observer of the graph would call this a(n):
Shortage
Surplus
Equilibrium price
Demand equals supply
At this price:
Low prices encourage buyers but discourage sellers
High prices encourage sellers but discourage buyers
The market is stable
Buyers can find goods at equilibrium price
To return to equilibrium, price would need to:
Increase
Decrease
Stay the same
Shift demand curve
Which description best describes the information in this graph at this price?
Supply exceeds demand
Demand exceeds supply
Qd = Qs
Qs = Qd
An observer of this graph would call this a(n):
Surplus
Shortage
Qd = Qs
Shift in supply
Every price higher than $3 would represent a(n):
Surplus
Shortage
Equilibrium price
Input cost
What is the process of evaluating marginal benefits (MB or gains) of a decision against marginal costs (MC or costs) of a decision, based on the assumption that the selected decision is one in which MB > MC?
Irrational Choices
Thinking at the Margin
Rational Decision Making
Investing
What is the formula for a rational decision?
MB = OC
MB > MC
MB < MC
OC = MC
What is an incentive?
ruthless, cold-hearted, & unfeeling behavior
a reward or punishment
lack of sympathy
inhumane & soulless treatment
What is the purpose of budgeting?
The purpose of budgeting is to increase debt and financial instability.
The purpose of budgeting is to restrict spending and limit financial resources.
The purpose of budgeting is to ignore financial planning and waste resources.
The purpose of budgeting is to plan and manage financial resources effectively.
What are the advantages of creating a budget?
Limited savings, lack of financial awareness, and increased risk of financial instability.
Difficulty in tracking expenses, inability to set financial goals, and poor financial decision-making.
Increasing debt, overspending, and lack of financial control.
Managing and tracking expenses, setting financial goals, saving money, avoiding debt, and making informed financial decisions.
How does scarcity affect economic decision making?
Scarcity leads to an abundance of resources for decision making.
Scarcity affects economic decision making by creating trade-offs and the need to prioritize resources.
Scarcity only affects non-economic decision making.
Scarcity has no impact on economic decision making.
What is the difference between fixed and variable expenses?
Fixed expenses are costs that change from month to month, while variable expenses remain the same each month.
Fixed expenses are costs that are not necessary, while variable expenses are essential.
Fixed expenses are costs that are paid in cash, while variable expenses are paid through credit cards.
Fixed expenses are costs that remain the same each month, while variable expenses can change from month to month.
Why is it important to track your expenses?
To waste time and effort
To ignore your financial situation
To understand where your money is going and make informed financial decisions.
To make random financial decisions
What is the difference between a need and a want?
A need is necessary for survival or basic living standards, while a want is desired but not necessary.
A need is something that is not necessary, while a want is necessary for survival.
A need is something that is desired but not necessary, while a want is necessary for survival.
A need and a want are the same thing.
What is the role of interest rates in economic decision making?
Interest rates affect borrowing costs, investment decisions, and consumer spending.
Interest rates only affect investment decisions.
Interest rates have no impact on economic decision making.
Interest rates only affect borrowing costs.
In general, what are the two options people have concerning money?
Spend it
Save it
Print it
Waste it
It allows us to place a monetary value on goods and services
Means of exchange
Unit of Account
Store of Value
Legal Tender
It allows us to trade
Means of exchange
Unit of Account
Store of Value
Legal Tender
A unit of account allows us to place a .................... value on goods and ................
estimated/products
monetary/services
certain/products
monetary/products
Legal Tender is a legally recognised form of payment
True
False
What is your credit rating based on?
History
Earnings
Other debt
All of these
What does #3 represent?
(drawing on board)
government
business
individual
resource market
Which of the following are examples of goods as opposed to services?
tees, golf lesson, golf shoes
tennis lesson, golf lesson, hair cut
tees, golf shoes, tennis racket
tennis lesson, golf lesson, tennis racket
Entrepreneurs are primarily motivated by __________
rent
wages
interest
profit
In the circular flow model households sell labor to firms in exchange for
rent
wages
interest
profit
In the picture shown, what flows from the government to households and businesses?
(picture on board)
rent
wages
taxes
public service
Goods and services are exchanged in the _____________
Product market
Factor market
Resource market
free market
In a market economy, resources are owned by households. Individuals in households take their resources to the __________
Product market
Goods and Services market
Factor market
None of the above
Land, labor, capital and entrepreneurship are _________
Natural resources
Government production
Public production
Factors of production
Zach has a landscaping business. Some of his profit will be used in procuring capital for the business. (a)
true
false
___________ money is when the declare the currency "legal tender" by the government
representative
fiat
digital
commodity
To much money in our economy leads to
Inflation
Recession
Increasing
Receding
The Federal Reserve...
Regulates the amount of money in circulation
Supervises banks
Provides financial services to banks and the public
All of the above.
The interest rate that the Federal Reserve charges commercial banks for Overnight loans is called the...?
discount rate
monetary policy
inside lag
tight money policy
How many regional Reserve Banks make up the Federal Reserve System?
12
6
22
50
What is the equation of GDP?
C + I + (X+N)
C + I + G
C + I + G + (X-N)
C + G + U + (X+N)
In the GDP equation, what does the 'C' stand for?
Consumer spending
Consumer income
Convoy
Consumer health
In the GDP equation, what does the 'I' stand for?
Intelligent spending
Investor spending
Incredible spending
Investment spending
In the GDP equation, what does the 'G' stand for?
Government taxes
Government spending
Government budget
Good Government
In the GDP equation, what does the 'X' stand for?
Extra Spending
Excellent
Exports
Extra Cool
In the GDP equation, what does the 'M' stand for?
Imports
Machines and Capital
Mal
Mixed economy
Which of the following is the best measurement of economic growth?
Nominal GDP
Real GDP
GDP per capita
Real GDP per capita
What is the total value of all final goods and services produced in the economy in a given year?
Unemployment rate
Supply and Demand
GDP
Communism
Which of the following is NOT part of GDP:
a new car that is sold
a teacher working in the classroom
a used TV on Craigslist
no answer
Which of the following are NOT in GDP:
Secondhand Sales
Retail Service
Intermediate Goods
Illegal Products
all
The development of skills in one aspect of a job is called
specialization
interdependence
entrepreneurship
globalization
