Question 1

In the factor market, firms ________ and households ________.

Accepted Answer

A) hire land, labor, capital, and entrepreneurship services; purchase goods and services 
B) supply land, labor, capital, and entrepreneurship services; hire land, labor, capital, and entrepreneurship services 
C) pay rent, wages, interest, and profit; earn rent, wages, interest, and profit 
D) purchase goods and services; supply goods and services 
E) supply goods and services; purchase goods and services 
A) hire land, labor, capital, and entrepreneurship services; purchase goods and services 
B) supply land, labor, capital, and entrepreneurship services; hire land, labor, capital, and entrepreneurship services 
C) pay rent, wages, interest, and profit; earn rent, wages, interest, and profit 
D) purchase goods and services; supply goods and services 
E) supply goods and services; purchase goods and services

Question 2

Which of the following is an example of an effort to decrease physical capital differences between an advanced and a developing economy?

Accepted Answer

A) American troops build roads in Afghanistan. 
B) Through World Vision, women and children in Africa receive education. 
C) Peace Corps volunteers teach English around the world. 
D) Creating Hope International trains women in Afghanistan to become tailors. 
E) Habitat for Humanity builds houses for low income families in the United States. 
A) American troops build roads in Afghanistan. 
B) Through World Vision, women and children in Africa receive education. 
C) Peace Corps volunteers teach English around the world. 
D) Creating Hope International trains women in Afghanistan to become tailors. 
E) Habitat for Humanity builds houses for low income families in the United States.

Question 3

Draw a circular flow diagram with households and firms and without government.Label the markets and the flows in the circular flow diagram.

Accepted Answer

@#IMG-DLM& A circular flow dia

Question 4

Which of the following are sources of revenue for state and local governments?
i. property taxes
ii. sales taxes
iii. transfers from the federal government

Accepted Answer

A) i and ii 
B) ii and iii 
C) i and iii 
D) i, ii and iii 
E) i only. 
A) i and ii 
B) ii and iii 
C) i and iii 
D) i, ii and iii 
E) i only.

Question 5

________ choose the quantities of factors of production to hire and ________ choose the quantities of goods and services to produce.

Accepted Answer

A) Entrepreneurs; firms 
B) Firms; firms 
C) Markets; markets 
D) Factor markets; goods markets 
E) Firms; households 
A) Entrepreneurs; firms 
B) Firms; firms 
C) Markets; markets 
D) Factor markets; goods markets 
E) Firms; households

Question 6

A circular flow model shows the interrelationship between the ________ market and the ________ markets.

Accepted Answer

A) household; goods 
B) household; factor 
C) business; household 
D) expenditure; income 
E) goods; factor 
A) household; goods 
B) household; factor 
C) business; household 
D) expenditure; income 
E) goods; factor

Question 7

What is the largest source of tax revenue for the U.S.federal government and what is the largest expenditure item of the U.S.federal government?

Accepted Answer

The largest source of tax revenue for th

Question 8

Within the circular flow model, economists define households as

Accepted Answer

A) families with at least 2 children. 
B) families living in their own houses. 
C) individuals or groups living together. 
D) married or engaged couples. 
E) individuals or groups within the same legally defined family. 
A) families with at least 2 children. 
B) families living in their own houses. 
C) individuals or groups living together. 
D) married or engaged couples. 
E) individuals or groups within the same legally defined family.

Question 9

Describe the circular flow of the economy by discussing the two markets where households and firms meet.

Accepted Answer

Firms and households meet in two markets

Question 10

The personal distribution of income in the United States shows that

Accepted Answer

A) income is equally distributed. 
B) the poorest 20 percent of individuals receive approximately 20 percent of total income. 
C) the richest 20 percent of individuals receive approximately 50 percent of total income. 
D) the poorest 60 percent of individuals receive approximately 50 percent of total income. 
E) the richest 20 percent of individuals receive approximately 25 percent of total income. 
A) income is equally distributed. 
B) the poorest 20 percent of individuals receive approximately 20 percent of total income. 
C) the richest 20 percent of individuals receive approximately 50 percent of total income. 
D) the poorest 60 percent of individuals receive approximately 50 percent of total income. 
E) the richest 20 percent of individuals receive approximately 25 percent of total income.

Question 11

In the circular flow model, which of the following flows in the opposite direction from the flow of factors of production?

Accepted Answer

A) finished goods and services 
B) wages, rent, interest, and profit 
C) interests payments of Federal, state, and local governments 
D) firm's profit incentives 
E) the goods market 
A) finished goods and services 
B) wages, rent, interest, and profit 
C) interests payments of Federal, state, and local governments 
D) firm's profit incentives 
E) the goods market

Question 12

Households receive transfers from ________ and firms receive transfers from ________.

Accepted Answer

A) government; government 
B) firms; households 
C) government; government and households 
D) firms and government; government 
E) government; no one 
A) government; government 
B) firms; households 
C) government; government and households 
D) firms and government; government 
E) government; no one

Question 13

Of the following, the federal government's largest source of revenue is the

Accepted Answer

A) sales tax. 
B) property tax. 
C) corporate income tax. 
D) social security tax. 
E) transfers from state and local governments. 
A) sales tax. 
B) property tax. 
C) corporate income tax. 
D) social security tax. 
E) transfers from state and local governments.

Question 14

Describe the government's flows in the circular flow model of the economy.

Accepted Answer

The government has several flows in the

Question 15

Capital is a factor of production.Which of the following is an example of capital?
I∙$1,000 in money
Ii∙100 shares of Microsoft stock
Iii∙$10,000 in bonds issued by General Motors
Iv∙A drill press in your local machine shop

Accepted Answer

A) i and ii 
B) ii only 
C) iii only 
D) iv only 
E) ii and iii 
A) i and ii 
B) ii only 
C) iii only 
D) iv only 
E) ii and iii

Question 16

Which of the following is a consumption good or service?

Accepted Answer

A) a personal computer purchased in order to play games at home 
B) a United Airline ticket counter 
C) the Endeavor space shuttle 
D) a United Parcel Service truck delivering Christmas gifts 
E) a satellite dish installed by Cox Cable to download programs that are then distributed through its cable system 
A) a personal computer purchased in order to play games at home 
B) a United Airline ticket counter 
C) the Endeavor space shuttle 
D) a United Parcel Service truck delivering Christmas gifts 
E) a satellite dish installed by Cox Cable to download programs that are then distributed through its cable system

Question 17

State and local governments finance expenditures mainly from

Accepted Answer

A) tax revenue. 
B) funds provided by the federal government. 
C) government bonds issued at the state level. 
D) private bank loans. 
E) lottery funds. 
A) tax revenue. 
B) funds provided by the federal government. 
C) government bonds issued at the state level. 
D) private bank loans. 
E) lottery funds.

Question 18

An export good is a good produced

Accepted Answer

A) in the United States and sold to foreigners living in the United States. 
B) by foreigners in the United States and purchased by U.S. households. 
C) in another country and purchased by U.S. residents. 
D) in the United States and sold in other countries. 
E) in another country and purchased by foreigners not residing in the United States. 
A) in the United States and sold to foreigners living in the United States. 
B) by foreigners in the United States and purchased by U.S. households. 
C) in another country and purchased by U.S. residents. 
D) in the United States and sold in other countries. 
E) in another country and purchased by foreigners not residing in the United States.

Question 19

What would be an example of capital good?

Accepted Answer

A) Jeanette buys a new dress. 
B) The local driver's license office purchases a new digital camera and printer. 
C) Antonio, the manager of the local Taco Hut, purchases a new deep fryer. 
D) Apple sells computers to Japan. 
E) Rhianna gets a haircut. 
A) Jeanette buys a new dress. 
B) The local driver's license office purchases a new digital camera and printer. 
C) Antonio, the manager of the local Taco Hut, purchases a new deep fryer. 
D) Apple sells computers to Japan. 
E) Rhianna gets a haircut.

Question 20

Identify the four factors of production, and tell what type of income is earned by each factor.

Accepted Answer

The factors of production are land, whic

In the factor market, firms and households .

Which of the following is an example of an effort to decrease physical capital differences between an advanced and a developing economy?

Draw a circular flow diagram with households and firms and without government.Label the markets and the flows in the circular flow diagram.

Which of the following are sources of revenue for state and local governments? i. property taxes ii. sales taxes iii. transfers from the federal government

choose the quantities of factors of production to hire and choose the quantities of goods and services to produce.

A circular flow model shows the interrelationship between the market and the markets.

What is the largest source of tax revenue for the U.S.federal government and what is the largest expenditure item of the U.S.federal government?

Within the circular flow model, economists define households as

Describe the circular flow of the economy by discussing the two markets where households and firms meet.

The personal distribution of income in the United States shows that

In the circular flow model, which of the following flows in the opposite direction from the flow of factors of production?

Households receive transfers from and firms receive transfers from .

Of the following, the federal government's largest source of revenue is the

Describe the government's flows in the circular flow model of the economy.

Capital is a factor of production.Which of the following is an example of capital? I∙$1,000 in money Ii∙100 shares of Microsoft stock Iii∙$10,000 in bonds issued by General Motors Iv∙A drill press in your local machine shop

Which of the following is a consumption good or service?

State and local governments finance expenditures mainly from

An export good is a good produced

What would be an example of capital good?

Identify the four factors of production, and tell what type of income is earned by each factor.

Getting Started

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets With Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 2: The Usand Global Economies

In the factor market, firms ________ and households ________.

Which of the following is an example of an effort to decrease physical capital differences between an advanced and a developing economy?

Draw a circular flow diagram with households and firms and without government.Label the markets and the flows in the circular flow diagram.

Which of the following are sources of revenue for state and local governments? i. property taxes ii. sales taxes iii. transfers from the federal government

________ choose the quantities of factors of production to hire and ________ choose the quantities of goods and services to produce.

A circular flow model shows the interrelationship between the ________ market and the ________ markets.

What is the largest source of tax revenue for the U.S.federal government and what is the largest expenditure item of the U.S.federal government?

Within the circular flow model, economists define households as

Describe the circular flow of the economy by discussing the two markets where households and firms meet.

The personal distribution of income in the United States shows that

In the circular flow model, which of the following flows in the opposite direction from the flow of factors of production?

Households receive transfers from ________ and firms receive transfers from ________.

Of the following, the federal government's largest source of revenue is the

Describe the government's flows in the circular flow model of the economy.

Capital is a factor of production.Which of the following is an example of capital? I∙$1,000 in money Ii∙100 shares of Microsoft stock Iii∙$10,000 in bonds issued by General Motors Iv∙A drill press in your local machine shop

Which of the following is a consumption good or service?

State and local governments finance expenditures mainly from

An export good is a good produced

What would be an example of capital good?

Identify the four factors of production, and tell what type of income is earned by each factor.

Getting Started

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets With Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

In the factor market, firms and households .

choose the quantities of factors of production to hire and choose the quantities of goods and services to produce.

A circular flow model shows the interrelationship between the market and the markets.

Households receive transfers from and firms receive transfers from .