Economics

Question 1

Which two factors drive demand in a microeconomic system?
Choose 2 answers

Production
Component shortage
Price of substitute goods
Customer preference

Answer 1

Price of substitute goods
Customer preference

Question 2

Which economic graph is used by organizations to regulate production by predicting the amount of
product buyers will purchase at different prices?

Demand curve
Price sensitivity scale
Product value scale
Product-price equilibrium

Answer 2

Demand curve

Question 3

How does a sudden shortage of a commodity product affect the immediate demand for the product at its
current price?

Demand diminishes
Demand increases
Demand is unchanged
Demand curve is skewed

Answer 3

Demand increases

Question 4

Which two impacts result from a nation’s increase in productivity?
Choose 2 answers

Hourly wages increase
Per capita output diminishes
Economy expands
Commodity prices increase
Personal wealth increases

Answer 4

Economy expands
Personal wealth increases

Question 5

For which two purposes will the U.S. Federal Reserve System follow an expansionary monetary policy?
Choose 2 answers

To hedge against inhation
To encourage bankers to make loans
To discourage overexpansion
To cut the cost of borrowing

Answer 5

To encourage bankers to make loans
To cut the cost of borrowing

Question 6

Which two economic impacts should a manager anticipate when the U.S. government reduces the number
of Treasury bills, Treasury Notes, andTreasury bonds it sells?
Choose 2 answers

-A rise of interest rates on these securities
-An increase in overall cost of debt to private borrowers
-An increase of foreign investment
-An increase of funds for public services

Answer 6

-A rise of interest rates on these securities
-An increase in overall cost of debt to private borrowers

Question 7

Which policy is used to manage the economy using government spending and taxation?

A) Monetary policy
B) Trade policy
C) Fiscal policy
D) Industrial policy

Answer 7

C) Fiscal policy ✅

Question 8

Which type of unemployment is when the employee expects to be unemployed for a portion of the year?

A) Seasonal unemployment
B) Frictional unemployment
C) Structural unemployment
D) Cyclical unemployment

Answer 8

A) Seasonal unemployment ✅

Question 9

Which type of unemployment is a result of not having the necessary skills for a job?

A) Frictional unemployment
B) Cyclical unemployment
C) Seasonal unemployment
D) Structural unemployment

Answer 9

B) Structural unemployment ✅

Question 10

A specific economic situation when price and demand rise together is called:

A) Inflation
B) Deflation
C) Recession
D) Stagnation

Answer 10

A) Inflation ✅

Question 11

As a business, is it best to reduce spending or increase spending in a high-inflation environment?

A) Reduce spending
B) Increase spending
C) Spend the same amount
D) Take on more debt

Answer 11

A) Reduce spending ✅

Question 12

As a business, which environment is best to make capital improvements?

A) High-inflation
B) Economic downturn
C) Low-inflation
D) Market saturation

Answer 12

C) Low-inflation

Question 13

Which type of competition requires government regulation for entry?
A) Oligopoly
B) Monopoly
C) Perfect competition
D) Monopolistic competition

Answer 13

B) Monopoly ✅

Question 14

Which type of competition is the easiest to enter?

A) Monopolistic competition
B) Oligopoly
C) Pure competition
D) Monopoly

Answer 14

C) Pure competition ✅

Question 15

What is the name of the graph that we use to demonstrate demand?

A) Supply curve
B) Demand curve
C) Production possibility curve
D) Market equilibrium graph

Answer 15

B) Demand curve ✅

Question 16

What is the point where supply and demand curves intersect?

A) Demand surplus
B) Supply shortage
C) Equilibrium price
D) Price floor

Answer 16

C) Equilibrium price ✅

Question 17

Is the study of supply and demand a micro or macroeconomic issue?

A) Microeconomics
B) Macroeconomics
C) Both
D) Neither

Answer 17

A) Microeconomics ✅

Question 18

When federal taxes are reduced, is that a micro or macroeconomic issue?

A) Microeconomics
B) Macroeconomics
C) Business finance
D) Local economy

Answer 18

B) Macroeconomics ✅

Question 19

When a tariff is increased on importing produce, is that a micro or macroeconomic issue?

A) Microeconomics
B) Domestic policy
C) International finance
D) Macroeconomics

Answer 19

D) Macroeconomics ✅

Question 20

Which economic graph is used by organizations to regulate production by predicting the amount of product buyers will purchase at different prices?

A) Supply curve
B) Cost-benefit analysis
C) Demand curve
D) Equilibrium graph

Answer 20

C) Demand curve

Question 21

Which two factors drive demand in a microeconomics system? (Choose 2)

A) Customer preference
B) Advertising campaigns
C) Seasonal trends
D) Price of substitute goods
E) Government regulations

Answer 21

A) Customer preference ✅D) Price of substitute goods ✅

Question 22

How does a sudden shortage of a commodity product affect the immediate demand for the product at its current price?

A) Demand decreases
B) Demand stays the same
C) Demand increases significantly
D) There is no immediate effect on demand

Answer 22

Demand Increases

Question 23

Which three impacts result from a nation’s increase in productivity? (Choose 3)

A) Unemployment increases
B) Economy expands
C) Inflation rises
D) Business profits rise
E) Personal wealth increases

Answer 23

B) Economy expands ✅
D) Business profits rise ✅
E) Personal wealth increases ✅

Question 24

For which two purposes will the U.S. Federal Reserve System follow an expansionary monetary policy?

A) To reduce government spending
B) To encourage bankers to make loans
C) To lower interest rates
D) To cut the cost of borrowing
E) To combat inflation

Answer 24

B) To encourage bankers to make loans ✅
D) To cut the cost of borrowing ✅

Question 25

Which two economic impacts should a manager anticipate when the U.S. government reduces the number of Treasury bills, Treasury Notes, and Treasury bonds it sells? Choose 2 answers A) An increase in overall cost of debt to private borrowers B) A decrease in borrowing costs for businesses C) An increase of funds for public services D) A decrease in inflation

Answer 25

A) An increase in overall cost of debt to private borrowers ✅ B) A decrease in borrowing costs for businesses

Question 26

A microeconomic system is: A) The study of government policies impacting trade agreements B) A branch of economics that studies individual and firm decision-making C) A strategy for managing global financial transactions D) A framework for predicting inflation and economic downturns

Answer 26

A branch of economics that studies individual and firm decision-making

Question 27

Which of the following are long-term funding sources? A) Share capital (equity shares) B) Retained earnings (internal accruals) C) Term loans from financial institutions, government, and commercial banks D) All of the above

Answer 27

All of the above

Question 28

Microeconomics is the study of: A) The study of economy-wide phenomena, including inflation and unemployment B) How households and firms make choices, how they interact in markets, and how the government attempts to influence their choices C) The overall supply and demand for national goods D) The banking system and monetary policy

Answer 28

How households and firms make choices, how they interact in markets, and how the government attempts to influence their choices

Question 29

Macroeconomics is the study of: A) How individual firms operate B) The impact of managerial decisions on a single industry C) The study of economy-wide phenomena, including inflation, unemployment, and economic growth D) The pricing strategy of firms in competitive markets

Answer 29

The study of economy-wide phenomena, including inflation, unemployment, and economic growth

Question 30

Which policy is used to manage the economy using government spending and taxation? A) Monetary policy B) Fiscal policy C) Trade policy D) Industrial regulation

Answer 30

Fiscal policy

Question 31

A specific economic situation when price and demand rise together is called: A) Deflation B) Inflation C) Equilibrium D) Economic stagnation

Answer 31

Inflation

Question 32

Which type of competition requires government regulation for entry? A) Perfect competition B) Monopoly C) Oligopoly D) Monopolistic competition

Answer 32

Monopoly

Question 33

What is a "lights-out" facility? A) A production facility that is only operational during off-peak hours B) A warehouse with automated storage and retrieval systems C) A facility that focuses on energy conservation D) A facility that produces goods with 100% automation

Answer 33

A facility that produces goods with 100% automation

Question 34

Microeconomics is: A) A study of international trade laws B) The study of individual and firm behavior in allocating scarce resources C) The analysis of economic conditions in developing countries D) A subset of finance focused on stock market trends

Answer 34

The study of individual and firm behavior in allocating scarce resources

Question 35

Macroeconomics is the study of - A) Economy-wide phenomena, including inflation, unemployment, and economic growth B) The marketing strategies of multinational corporations C) The impact of consumer psychology on product pricing D) The relationship between small businesses and regional supply chains

Answer 35

Economy-wide phenomena, including inflation, unemployment, and economic growth

Question 36

Which policy is used to manage the economy using government spending and taxation? A) Monetary B) Fiscal C) Trade D) Supply-side

Answer 36

Fiscal

Question 37

Which policy is used to manage the economy using government spending and taxation? A) Fiscal B) Monetary C) Trade D) Industrial

Answer 37

Fiscal

Question 38

A specific economic situation when price and demand rise together. A) Deflation B) Stagflation C) Inflation D) Recession

Answer 38

Inflation

Question 39

Which type of competition requires government regulation for entry? A) Oligopoly B) Perfect competition C) Monopoly D) Monopolistic competition

Answer 39

Monopoly

Question 40

Which economic graph is used by organizations to regulate production by predicting the amount of product buyers will purchase at different prices? A) Demand curve B) Supply curve C) Production possibility frontier D) Business cycle

Answer 40

Demand curve

Question 41

Which two factors drive demand in a microeconomic system? Choose 2 answers: A) Cost of production B) Price of substitute goods C) Customer preference D) Government taxation

Answer 41

Price of substitute goods Customer preference

Question 42

How does a sudden shortage of a commodity product affect the immediate demand for the product at its current price? A) Demand decreases B) Demand increases C) Demand remains the same D) The government intervenes

Answer 42

Demand increases

Question 43

Which two impacts result from a nation's increase in productivity? Choose 2 answers: A) Higher unemployment B) Economy expands C) Personal wealth increases D) Reduction in GDP

Answer 43

Economy expands Personal wealth increases

Question 44

For which two purposes will the U.S. Federal Reserve System follow an expansionary monetary policy? Choose 2 answers: A) To encourage bankers to make loans B) To reduce consumer spending C) To cut the cost of borrowing D) To decrease employment

Answer 44

To encourage bankers to make loans To cut the cost of borrowing

Question 45

Which two economic impacts should a manager anticipate when the U.S. government reduces the number of Treasury bills, Treasury Notes, and Treasury bonds it sells? Choose 2 answers: A) Decreased government spending B) A rise of interest rates on these securities C) A decline in inflation D) An increase in overall cost of debt to private borrowers

Answer 45

A rise of interest rates on these securities An increase in overall cost of debt to private borrowers

Question 46

What does microeconomics study? A) The study of smaller economic units such as individual consumers, families, and individual businesses B) The impact of international trade on the economy C) Government policies on economic growth D) The study of national economic policies

Answer 46

The study of smaller economic units such as individual consumers, families, and individual businesses

Question 47

What is monopolistic competition? A) A market with only one producer and many consumers B) A market structure where there are a large number of buyers and sellers who each have significant control over price C) A market with a few large firms controlling prices D) A market where prices are determined purely by demand

Answer 47

A market structure where there are a large number of buyers and sellers who each have significant control over price

Question 48

What is the core inflation rate? A) The general increase in price levels across the economy B) The rate of inflation excluding the effects of food and energy prices C) The rate of increase in energy costs D) The inflation rate of international goods

Answer 48

The rate of inflation excluding the effects of food and energy prices

Question 49

What is monetary policy? A) A policy set by the government for tax rates B) Government policy that attempts to manage the economy by controlling the money supply and thus interest rates C) The regulation of national income D) Government policy on international trade

Answer 49

Government policy that attempts to manage the economy by controlling the money supply and thus interest rates

Question 50

What is restrictive monetary policy? A) A policy to increase the money supply to stimulate growth B) A policy that increases interest rates to boost savings C) A policy to balance foreign trade deficits D) A policy that reduces the money supply to curb rising prices, over-expansion, and concerns about overly rapid economic growth

Answer 50

Policy that reduces the money supply to curb rising prices, over-expansion, and concerns about overly rapid economic growth

Question 51

What does economics study? A) The regulation of stock exchanges B) The study of how choices people and governments make when allocating resources C) The management of national defense budgets D) The role of international financial institutions

Answer 51

The study of how choices people and governments make when allocating resources

Question 52

What do ISO9000 standards address? A) The establishment of effective quality systems B) Employee training programs C) Legal compliance in manufacturing D) The financial auditing process

Answer 52

The establishment of effective quality systems

Question 53

What two factors drive demand in a microeconomic system? A) Price of substitute goods, customer preference B) Government taxation policies, price of raw materials C) Interest rates, labor costs D) Advertising costs, market entry barriers

Answer 53

Price of substitute goods, customer preference

Question 54

How does a sudden shortage of a commodity product affect the immediate demand for the product at its current price? A) Demand increases B) Demand decreases C) Demand stays constant D) Demand fluctuates in an unpredictable way

Answer 54

Demand increases

Question 55

What two purposes does the US Federal Reserve follow in an expansionary monetary policy? A) Stabilize foreign exchange rates, increase tax revenues B) Raise interest rates, control inflation C) Reduce government spending, increase the national debt D) Encourage bankers to make loans, cut the cost of borrowing

Answer 55

Encourage bankers to make loans, cut the cost of borrowing