Question 1

Consumer spending accounts for what share of GDP?

Accepted Answer

A)  20% 
B)  40% 
C)  70% 
D)  90% 
A)  20% 
B)  40% 
C)  70% 
D)  90%

Question 2

A mixed economy is one that combines public and private ownership of property.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is true about the United States?

Accepted Answer

A)  There has only been on recession in U.S.history. 
B)  There have been recessions every couple of years throughout U.S.history. 
C)  Recessions have never occurred in the United States. 
D)  Recessions have occurred periodically in U.S.history. 
E)  Recessions in the United States have generally been worse than in other countries. 
A)  There has only been on recession in U.S.history. 
B)  There have been recessions every couple of years throughout U.S.history. 
C)  Recessions have never occurred in the United States. 
D)  Recessions have occurred periodically in U.S.history. 
E)  Recessions in the United States have generally been worse than in other countries.

Question 4

Which of the following is the most closed economy?

Accepted Answer

A)  the Netherlands 
B)  the United States 
C)  Germany 
D)  Russia 
E)  Canada 
A)  the Netherlands 
B)  the United States 
C)  Germany 
D)  Russia 
E)  Canada

Question 5

A recession can best be defined as a period of time in which

Accepted Answer

A)  total output of the economy falls. 
B)  total output of the economy rises very slowly. 
C)  total unemployment falls. 
D)  total international trade fails to rise. 
E)  Both a and c 
A)  total output of the economy falls. 
B)  total output of the economy rises very slowly. 
C)  total unemployment falls. 
D)  total international trade fails to rise. 
E)  Both a and c

Question 6

Education accounts for the largest share of state and local government spending.

Accepted Answer

A) True 
 B)False

Question 7

The U.S.economy is unique for both its size and prosperity.

Accepted Answer

A) True 
 B)False

Question 8

The personal income tax is the single largest source of revenue for the federal government.

Accepted Answer

A) True 
 B)False

Question 9

There are about 5 million business firms in the Unites States.

Accepted Answer

A) True 
 B)False

Question 10

Workers earn more than half of the income generated by the production process.

Accepted Answer

A) True 
 B)False

Question 11

In a mixed economy, there is some public influence over the workings of free markets.

Accepted Answer

A) True 
 B)False

Question 12

Outputs include goods but not services.

Accepted Answer

A) True 
 B)False

Question 13

Government production accounts for about half of all GDP in the United States.

Accepted Answer

A) True 
 B)False

Question 14

America's antitrust laws are used to protect competition against possible encroachment by monopoly.This is an example of government as

Accepted Answer

A)  regulator of businesses. 
B)  buyer of goods and services. 
C)  tax collector. 
D)  redistributor. 
A)  regulator of businesses. 
B)  buyer of goods and services. 
C)  tax collector. 
D)  redistributor.

Question 15

All industrialized countries have become "service economies." Which factor helps explain this shift?

Accepted Answer

A)  Trade unionism and failure of the manufacturing sector to grow. 
B)  Information age and labor saving innovation in manufacturing. 
C)  Non availability of industrial labor with required skills. 
D)  Absence of competition in the service sector. 
A)  Trade unionism and failure of the manufacturing sector to grow. 
B)  Information age and labor saving innovation in manufacturing. 
C)  Non availability of industrial labor with required skills. 
D)  Absence of competition in the service sector.

Question 16

List five major economic activities of government, and give an example of each.

Accepted Answer

1.Government as referee.Example: enforci

Question 17

The role of government in a market economy includes all of the following except

Accepted Answer

A)  providing services such as national defense. 
B)  collecting taxes. 
C)  extensive ownership of productive resources. 
D)  making and enforcing laws. 
A)  providing services such as national defense. 
B)  collecting taxes. 
C)  extensive ownership of productive resources. 
D)  making and enforcing laws.

Question 18

One important role for government as referee is in defining and enforcing property rights.

Accepted Answer

A) True 
 B)False

Question 19

Multinational businesses produce and sell goods around the world.

Accepted Answer

A) True 
 B)False

Question 20

An open economy produces most of the goods and services that it needs, with few imports and exports.

Accepted Answer

A) True 
 B)False

Exam 2: The Economy: Myth and Reality

Consumer spending accounts for what share of GDP?

A mixed economy is one that combines public and private ownership of property.

Which of the following is true about the United States?

Which of the following is the most closed economy?

A recession can best be defined as a period of time in which

Education accounts for the largest share of state and local government spending.

The U.S.economy is unique for both its size and prosperity.

The personal income tax is the single largest source of revenue for the federal government.

There are about 5 million business firms in the Unites States.

Workers earn more than half of the income generated by the production process.

In a mixed economy, there is some public influence over the workings of free markets.

Outputs include goods but not services.

Government production accounts for about half of all GDP in the United States.

America's antitrust laws are used to protect competition against possible encroachment by monopoly.This is an example of government as

All industrialized countries have become "service economies." Which factor helps explain this shift?

List five major economic activities of government, and give an example of each.

The role of government in a market economy includes all of the following except

One important role for government as referee is in defining and enforcing property rights.

Multinational businesses produce and sell goods around the world.

An open economy produces most of the goods and services that it needs, with few imports and exports.

What Is Economics?

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: An Initial Look

Consumer Choice: Individual and Market Demand

Demand and Elasticity

Production, Inputs, and Cost: Building Blocks for Supply Analysis

Output, Price, and Profit: The Importance of Marginal Analysis

Securities: Business Finance, and the Economy: The Tail that Wags the Dog?

The Firm and the Industry under Perfect Competition

Monopoly

Between Competition and Monopoly

Limiting Market Power: Regulation and Antitrust

The Case for Free Markets I: The Price System

The Shortcomings of Free Markets

The Market's Prime Achievement: Innovation and Growth

Externalities, the Environment, and Natural Resources

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship: The Human Inputs

Poverty, Inequality, and Discrimination

An Introduction to Macroeconomics

The Goals of Macroeconomic Policy

Economic Growth: Theory and Policy

Aggregate Demand and the Powerful Consumer

Demand-Side Equilibrium: Unemployment or Inflation?

Bringing in the Supply Side: Unemployment and Inflation?

Managing Aggregate Demand: Fiscal Policy

Money and the Banking System

Monetary Policy: Conventional and Unconventional

The Financial Crisis and the Great Recession

The Debate over Monetary and Fiscal Policy

Budget Deficits in the Short and Long Run

The Trade-Off between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System: Order or Disorder?

Exchange Rates and the Macroeconomy

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