Question 1

Monetary policy involves changes in the government's revenues and expenditures to stimulate a slow economy or dampen a growing economy that is in danger of overheating and causing inflation.

Accepted Answer

A) True 
 B)False  False

Question 2

Capital is the collective intelligence of an organization.

Accepted Answer

A) True 
 B)False  False

Question 3

Deflation is an economic condition in which prices fall steadily throughout the economy.

Accepted Answer

A) True 
 B)False  True

Question 4

In recent years,why have the governments of various countries both nationalized and privatized some of their services?

Accepted Answer

The answer of In recent years,why have the governments of...

Question 5

The ________ depicts the relationship between prices and quantities that sellers will offer for sale,regardless of demand.

Accepted Answer

A)   demand curve
B)   supply curve
C)   equilibrium point
D)   business cycle
E)   competitive analysis

Question 6

Due to government mandate,only one company has the exclusive right to provide electricity in all the cities of Borgia.This is an example of a ________.

Accepted Answer

A)   pure competition
B)   pure monopoly
C)   regulated monopoly
D)   monopolistic competition
E)   regulated monopsony

Question 7

Economic development zones,established by governments,offer a variety of financial incentives to businesses that meet specific job creation and local investment criteria.

Accepted Answer

A) True 
 B)False

Question 8

________ is the spirit of innovation,the initiative,and the willingness to take the risks involved in creating and operating businesses.

Accepted Answer

A)   Capitalization
B)   Socialization
C)   Merchandizing
D)   Automation
E)   Entrepreneurship

Question 9

Explain the meaning of a leading indicator with the help of an example.

Accepted Answer

The answer of Explain the meaning of a leading indicator...

Question 10

Explain,with the help of an example,why socialism and capitalism are not mutually exclusive.

Accepted Answer

The answer of Explain,with the help of an example,why socialism...

Question 11

When a downward swing or recession is over,the economy enters into a period of ________.

Accepted Answer

A)   recovery
B)   depression
C)   contraction
D)   stagnation
E)   immobilism

Question 12

The point at which the demand and supply curves intersect - the point at which the quantity demanded and supplied are equal - is called the ________.

Accepted Answer

A)   equilibrium point
B)   aggregation point
C)   marginal point
D)   break-even point
E)   distribution point

Question 13

________ refers to the amount of a good or service that customers will buy at a given time.

Accepted Answer

A)   Demand
B)   Utility
C)   Equilibrium
D)   Necessity
E)   Want

Question 14

A deep and prolonged recession is known as a(n)________.

Accepted Answer

A)   contraction
B)   stagnation
C)   deflation
D)   immobilism
E)   depression

Question 15

Compare and contrast between monetary and fiscal policies.

Accepted Answer

The answer of Compare and contrast between monetary and fiscal...

Question 16

In practice,no economy is truly a free-market economy.

Accepted Answer

A) True 
 B)False

Question 17

Movement along the supply curve typically slopes upward because ________.

Accepted Answer

A)   the amount of government regulation in an industry rises with increase in demand
B)   the quantity that the sellers are willing to supply rises with decrease in demand
C)   the amount of government regulation in an industry rises with increase in price
D)   the quantity that the sellers are willing to supply rises with increase in government regulation
E)   the quantity that the sellers are willing to supply rises with increase in price

Question 18

Workers in a country are unable to find jobs that match their qualifications and the employers are unable to find employees with the skills required to perform the job.This has led to ________ unemployment in this country.

Accepted Answer

A)   frictional
B)   seasonal
C)   structural
D)   cyclical
E)   intrinsic

Question 19

How does capitalism promote monopolistic competition in the market?

Accepted Answer

The answer of How does capitalism promote monopolistic competition in...

Question 20

Microeconomics is the study of ________.

Accepted Answer

A)   the costs of production as a means of stimulating the economy and policies that raise capital and labour output by increasing the incentive to produce
B)   economic and financial data of the country by the application of mathematics and statistics
C)   the overall working of an economy in the society including its monetary and fiscal policies
D)   economic behavior among consumers, businesses, and industries that collectively determine the quantity of goods and services demanded and supplied at different prices
E)   a nation's economic issues, such as the effect of government policies and the ownership of factors of production

Exam 2: Understanding Basic Economics