Question 1

The policy of erecting trade barriers to protect domestic industry is known as

Accepted Answer

A) deregulation. 
B) protectionism. 
C) free-trade economics. 
D) monetary policy. 
E) dumping. 
A) deregulation. 
B) protectionism. 
C) free-trade economics. 
D) monetary policy. 
E) dumping.

Question 2

A company in which new employees must join a union within a stated time period is called a(n)

Accepted Answer

A) right to work corporation. 
B) organized employee industry. 
C) union shop. 
D) monopoly. 
E) open shop. 
A) right to work corporation. 
B) organized employee industry. 
C) union shop. 
D) monopoly. 
E) open shop.

Question 3

Domination of an industry by a single company is known as corporatism.

Accepted Answer

A) True 
 B)False

Question 4

Efforts by companies to improve their reputations by paying attention to their contributions to the social good are known as

Accepted Answer

A) smoke screens. 
B) regulatory assessment reports. 
C) charitable organization contributions. 
D) labor injunctions. 
E) corporate social responsibility. 
A) smoke screens. 
B) regulatory assessment reports. 
C) charitable organization contributions. 
D) labor injunctions. 
E) corporate social responsibility.

Question 5

The national debt refers to

Accepted Answer

A) when the federal government raises less money than it spends in a given year. 
B) the amount of money the federal government gives state governments. 
C) the combination of inflation and lack of economic growth. 
D) the amount of money collected in taxes by the federal government. 
E) the total amount of money the federal government has borrowed. 
A) when the federal government raises less money than it spends in a given year. 
B) the amount of money the federal government gives state governments. 
C) the combination of inflation and lack of economic growth. 
D) the amount of money collected in taxes by the federal government. 
E) the total amount of money the federal government has borrowed.

Question 6

____________________ refers to the number of Americans who are out of work but actively looking for a job.

Accepted Answer

A) Hardship 
B) Unemployment 
C) Welfare 
D) Inflation 
E) Recession 
A) Hardship 
B) Unemployment 
C) Welfare 
D) Inflation 
E) Recession

Question 7

The ______________________ was signed by the United States, Canada, and Mexico in 1992 to form the largest free trade zone in the world.

Accepted Answer

A) Western Hemisphere Free Trade Agreement 
B) Tri-Country Free Trade Agreement 
C) General Agreement on Tariffs and Trade 
D) Good Faith Trade Pact 
E) North American Free Trade Agreement 
A) Western Hemisphere Free Trade Agreement 
B) Tri-Country Free Trade Agreement 
C) General Agreement on Tariffs and Trade 
D) Good Faith Trade Pact 
E) North American Free Trade Agreement

Question 8

Members of the Federal Reserve Board are appointed to 14-year terms by the vice president.

Accepted Answer

A) True 
 B)False

Question 9

The type of policy that promotes cutback in the amount of federal regulation in specific areas of economic activity is

Accepted Answer

A) deregulation. 
B) anti-regulation. 
C) deficit spending. 
D) social responsibility. 
E) stagflation. 
A) deregulation. 
B) anti-regulation. 
C) deficit spending. 
D) social responsibility. 
E) stagflation.

Question 10

Taxes on imports from other countries are known as

Accepted Answer

A) shipping fees. 
B) excise taxes. 
C) sin taxes. 
D) executive agreements. 
E) tariffs. 
A) shipping fees. 
B) excise taxes. 
C) sin taxes. 
D) executive agreements. 
E) tariffs.

Question 11

The two types of regulatory agencies created by Congress are

Accepted Answer

A) joint committees and corporate task forces. 
B) judicial evaluation boards and economist advisory groups. 
C) unfair practices agencies and congressional regulatory committees. 
D) oversight commissions and budgetary departments. 
E) independent agencies and independent regulatory commissions. 
A) joint committees and corporate task forces. 
B) judicial evaluation boards and economist advisory groups. 
C) unfair practices agencies and congressional regulatory committees. 
D) oversight commissions and budgetary departments. 
E) independent agencies and independent regulatory commissions.

Question 12

Under the Constitution, _______________ has the authority for raising revenue and appropriating funds.

Accepted Answer

A) the cabinet 
B) the Congressional Budget Office 
C) the president 
D) the Office of Management and Budget 
E) Congress 
A) the cabinet 
B) the Congressional Budget Office 
C) the president 
D) the Office of Management and Budget 
E) Congress

Question 13

When Congress and the president cannot use their discretion to change the spending rates it is called

Accepted Answer

A) mandatory spending. 
B) automatic spending. 
C) irrational spending. 
D) required spending. 
E) defense spending. 
A) mandatory spending. 
B) automatic spending. 
C) irrational spending. 
D) required spending. 
E) defense spending.

Question 14

The Sherman Antitrust Act of 1890 and the Clayton Act of 1914 are examples of

Accepted Answer

A) deregulation. 
B) tariff reduction statutes. 
C) labor injunctions. 
D) antitrust legislation. 
E) collective bargaining. 
A) deregulation. 
B) tariff reduction statutes. 
C) labor injunctions. 
D) antitrust legislation. 
E) collective bargaining.

Question 15

In times of recession, Keynes advocated

Accepted Answer

A) increased government spending. 
B) tax cuts. 
C) increased tariffs. 
D) dramatic reductions in government programs. 
E) All of the above 
A) increased government spending. 
B) tax cuts. 
C) increased tariffs. 
D) dramatic reductions in government programs. 
E) All of the above

Question 16

The practice of moving a business from the United States to other countries with cheaper labor costs is known as "offshoring."

Accepted Answer

A) True 
 B)False

Question 17

A new tax takes in 25% of the income of people making more than $50,000 per year and 35% of the income of people making less than $50,000 per year.Such a tax is considered to be

Accepted Answer

A) regressive. 
B) progressive. 
C) universal. 
D) gradual. 
E) stagnant. 
A) regressive. 
B) progressive. 
C) universal. 
D) gradual. 
E) stagnant.

Question 18

Stagflation refers to a period in which there is simultaneously economic expansion and inflation.

Accepted Answer

A) True 
 B)False

Question 19

The Federal Reserve banks serve all of the following functions EXCEPT

Accepted Answer

A) insuring bank deposits. 
B) regulating banks. 
C) determining money supply in the economy. 
D) influencing interest rates. 
E) All of the above are functions 
A) insuring bank deposits. 
B) regulating banks. 
C) determining money supply in the economy. 
D) influencing interest rates. 
E) All of the above are functions

Question 20

Dumping is the practice of selling products below the cost of manufacturing or below their domestic price with the intention of driving other producers out of the market and then raising prices to profitable levels.

Accepted Answer

A) True 
 B)False

Exam 18: Making Economic Policy

The policy of erecting trade barriers to protect domestic industry is known as

A company in which new employees must join a union within a stated time period is called a(n)

Domination of an industry by a single company is known as corporatism.

Efforts by companies to improve their reputations by paying attention to their contributions to the social good are known as

The national debt refers to

____________________ refers to the number of Americans who are out of work but actively looking for a job.

The ______________________ was signed by the United States, Canada, and Mexico in 1992 to form the largest free trade zone in the world.

Members of the Federal Reserve Board are appointed to 14-year terms by the vice president.

The type of policy that promotes cutback in the amount of federal regulation in specific areas of economic activity is

Taxes on imports from other countries are known as

The two types of regulatory agencies created by Congress are

Under the Constitution, _______________ has the authority for raising revenue and appropriating funds.

When Congress and the president cannot use their discretion to change the spending rates it is called

The Sherman Antitrust Act of 1890 and the Clayton Act of 1914 are examples of

In times of recession, Keynes advocated

The practice of moving a business from the United States to other countries with cheaper labor costs is known as "offshoring."

A new tax takes in 25% of the income of people making more than $50,000 per year and 35% of the income of people making less than $50,000 per year.Such a tax is considered to be

Stagflation refers to a period in which there is simultaneously economic expansion and inflation.

The Federal Reserve banks serve all of the following functions EXCEPT

Dumping is the practice of selling products below the cost of manufacturing or below their domestic price with the intention of driving other producers out of the market and then raising prices to profitable levels.

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