Question 1

Which of the following expenditures is the most important in expanding a country's production possibilities?

Accepted Answer

A)  Consumer goods. 
B)  Investment goods. 
C)  Government services. 
D)  Net exports. 
A)  Consumer goods. 
B)  Investment goods. 
C)  Government services. 
D)  Net exports.

Question 2

Investment includes all of the following EXCEPT:

Accepted Answer

A)  The production of new factories. 
B)  The purchase of new machinery and equipment. 
C)  Money in a retirement fund. 
D)  Business inventories. 
A)  The production of new factories. 
B)  The purchase of new machinery and equipment. 
C)  Money in a retirement fund. 
D)  Business inventories.

Question 3

The term externalities refers to:

Accepted Answer

A)  Black-market economic activity. 
B)  Some costs and benefits of a market activity borne by a third party. 
C)  The impact on markets of goods imported from foreign countries. 
D)  Illegal economic activity. 
A)  Black-market economic activity. 
B)  Some costs and benefits of a market activity borne by a third party. 
C)  The impact on markets of goods imported from foreign countries. 
D)  Illegal economic activity.

Question 4

The value of output produced in the United States in current prices measures:

Accepted Answer

A)  GDP growth. 
B)  Real GDP. 
C)  Per capita GDP. 
D)  Nominal GDP. 
A)  GDP growth. 
B)  Real GDP. 
C)  Per capita GDP. 
D)  Nominal GDP.

Question 5

What does the government do to protect consumers from monopolies? List specific steps the government takes to protect consumers.

Accepted Answer

Government tries to prevent individual f

Question 6

Over the last century in the United States there has been an increase in _______ as a percentage of total output.

Accepted Answer

A)  Construction and mining 
B)  Farming 
C)  Manufacturing 
D)  Services 
A)  Construction and mining 
B)  Farming 
C)  Manufacturing 
D)  Services

Question 7

Government income transfers are NOT included in the calculation of GDP because:

Accepted Answer

A)  It is difficult to measure the value of these payments. 
B)  Most of these payments are paid to foreign immigrants. 
C)  These payments do not have an impact on the WHAT question. 
D)  These payments do not reflect the production of goods and services. 
A)  It is difficult to measure the value of these payments. 
B)  Most of these payments are paid to foreign immigrants. 
C)  These payments do not have an impact on the WHAT question. 
D)  These payments do not reflect the production of goods and services.

Question 8

The U.S.tax-transfer system gives more output to lower-income households than does the market alone.

Accepted Answer

A) True 
 B)False

Question 9

If an individual purchases stock in the stock market,this is included in the economic definition of investment as a component of GDP.

Accepted Answer

A) True 
 B)False

Question 10

In order to measure what a country produces,we:

Accepted Answer

A)  Summarize total output in physical terms. 
B)  Count units of output. 
C)  Count the weight of different products. 
D)  Summarize the monetary value of output. 
A)  Summarize total output in physical terms. 
B)  Count units of output. 
C)  Count the weight of different products. 
D)  Summarize the monetary value of output.

Question 11

If output growth exceeds population growth for a country,then:

Accepted Answer

A)  Average living standards will increase. 
B)  GDP must have grown at a very rapid rate. 
C)  Per capita GDP will decrease. 
D)  This country must have overcome the problem of scarcity. 
A)  Average living standards will increase. 
B)  GDP must have grown at a very rapid rate. 
C)  Per capita GDP will decrease. 
D)  This country must have overcome the problem of scarcity.

Question 12

The goods and services sold to foreign buyers are:

Accepted Answer

A)  Imports. 
B)  Exports. 
C)  Income transfers. 
D)  Externalities. 
A)  Imports. 
B)  Exports. 
C)  Income transfers. 
D)  Externalities.

Question 13

Which of the following is NOT an example of investment,according to economists?

Accepted Answer

A)  A business builds a new factory. 
B)  A private college buys a new copy machine to replace an old worn out machine. 
C)  A family buys $10,000 worth of bonds. 
D)  A department store buys additional men's jeans just before Christmas. 
A)  A business builds a new factory. 
B)  A private college buys a new copy machine to replace an old worn out machine. 
C)  A family buys $10,000 worth of bonds. 
D)  A department store buys additional men's jeans just before Christmas.

Question 14

Most businesses in the U.S.are classified as:

Accepted Answer

A)  Corporations. 
B)  Partnerships. 
C)  Proprietorships. 
D)  Non-profit. 
A)  Corporations. 
B)  Partnerships. 
C)  Proprietorships. 
D)  Non-profit.

Question 15

If government intervention forces the economy inside the production possibilities curve,there is:

Accepted Answer

A)  Market failure. 
B)  Government failure. 
C)  An externality. 
D)  Income inequality. 
A)  Market failure. 
B)  Government failure. 
C)  An externality. 
D)  Income inequality.

Question 16

Changes in real GDP serve as a better measure of the health of the economy than changes in nominal GDP because real GDP is affected by changes in:

Accepted Answer

A)  Output only. 
B)  Prices and output. 
C)  Prices only. 
D)  Average wages. 
A)  Output only. 
B)  Prices and output. 
C)  Prices only. 
D)  Average wages.

Question 17

Which of the following is NOT viewed as a role for the U.S.government?

Accepted Answer

A)  Providing a legal framework for business. 
B)  Owning the factors of production. 
C)  Protecting consumers from exploitation. 
D)  Protecting the environment. 
A)  Providing a legal framework for business. 
B)  Owning the factors of production. 
C)  Protecting consumers from exploitation. 
D)  Protecting the environment.

Question 18

A market characterized as a monopoly:

Accepted Answer

A)  Prices tend to be lower and output tends to be higher. 
B)  Output tends to be lower and prices tend to be higher. 
C)  Quality and output tend to be higher. 
D)  Prices tend to be lower and quality tends to be higher. 
A)  Prices tend to be lower and output tends to be higher. 
B)  Output tends to be lower and prices tend to be higher. 
C)  Quality and output tend to be higher. 
D)  Prices tend to be lower and quality tends to be higher.

Question 19

Which of the following statements is true?

Accepted Answer

A)  A country's GDP includes all output produced by its factors of production. 
B)  A country's GDP includes all output produced within its borders. 
C)  A country's GDP is equal to its exports minus its imports. 
D)  A country's GDP is equal to all output produced and consumed within its borders. 
A)  A country's GDP includes all output produced by its factors of production. 
B)  A country's GDP includes all output produced within its borders. 
C)  A country's GDP is equal to its exports minus its imports. 
D)  A country's GDP is equal to all output produced and consumed within its borders.

Question 20

Imports:

Accepted Answer

A)  Are goods and services sold to foreigners. 
B)  Increase the value of GDP. 
C)  Are a larger dollar value than exports for the United States. 
D)  Equal exports in dollar value for most countries. 
A)  Are goods and services sold to foreigners. 
B)  Increase the value of GDP. 
C)  Are a larger dollar value than exports for the United States. 
D)  Equal exports in dollar value for most countries.

Which of the following expenditures is the most important in expanding a country's production possibilities?

Investment includes all of the following EXCEPT:

The term externalities refers to:

The value of output produced in the United States in current prices measures:

What does the government do to protect consumers from monopolies? List specific steps the government takes to protect consumers.

Over the last century in the United States there has been an increase in _______ as a percentage of total output.

Government income transfers are NOT included in the calculation of GDP because:

The U.S.tax-transfer system gives more output to lower-income households than does the market alone.

If an individual purchases stock in the stock market,this is included in the economic definition of investment as a component of GDP.

In order to measure what a country produces,we:

If output growth exceeds population growth for a country,then:

The goods and services sold to foreign buyers are:

Which of the following is NOT an example of investment,according to economists?

Most businesses in the U.S.are classified as:

If government intervention forces the economy inside the production possibilities curve,there is:

Changes in real GDP serve as a better measure of the health of the economy than changes in nominal GDP because real GDP is affected by changes in:

Which of the following is NOT viewed as a role for the U.S.government?

A market characterized as a monopoly:

Which of the following statements is true?

Imports:

The Challenge of Economics

Supply and Demand

Consumer Demand

Supply Decisions

Competition

Monopoly

The Labor Market

Government Intervention

The Business Cycle

Aggregate Supply and Demand

Fiscal Policy

Money and Banks

Monetary Policy

Economic Growth

Theory and Reality

International Trade

Filters

Exam 2: The US Economy

Which of the following expenditures is the most important in expanding a country's production possibilities?

Investment includes all of the following EXCEPT:

The term externalities refers to:

The value of output produced in the United States in current prices measures:

What does the government do to protect consumers from monopolies? List specific steps the government takes to protect consumers.

Over the last century in the United States there has been an increase in _______ as a percentage of total output.

Government income transfers are NOT included in the calculation of GDP because:

The U.S.tax-transfer system gives more output to lower-income households than does the market alone.

If an individual purchases stock in the stock market,this is included in the economic definition of investment as a component of GDP.

In order to measure what a country produces,we:

If output growth exceeds population growth for a country,then:

The goods and services sold to foreign buyers are:

Which of the following is NOT an example of investment,according to economists?

Most businesses in the U.S.are classified as:

If government intervention forces the economy inside the production possibilities curve,there is:

Changes in real GDP serve as a better measure of the health of the economy than changes in nominal GDP because real GDP is affected by changes in:

Which of the following is NOT viewed as a role for the U.S.government?

A market characterized as a monopoly:

Which of the following statements is true?

Imports:

The Challenge of Economics

Supply and Demand

Consumer Demand

Supply Decisions

Competition

Monopoly

The Labor Market

Government Intervention

The Business Cycle

Aggregate Supply and Demand

Fiscal Policy

Money and Banks

Monetary Policy

Economic Growth

Theory and Reality

International Trade

Filters