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FreeEnterprise Final
| Question | Answer |
|---|---|
| If a bank goes bankrupt, the funds of individual depositors are protected by the: | FDIC (Federal Deposit Insurance Corperation) |
| Electronic banking was made possible by: | computers |
| The Fed and/or Congress can make more money by: | borrowing from China or other countries; selling securities |
| Members of the Board of Govenors: | appointed by the PResident |
| Decisions to raise or lower interest rates are made by the: | FED |
| The most important Fed bank is in: | New York |
| 1/4 of the world's gold is stored in: | New York Fed |
| Which of the following is a result of loose money policy?A) people are willing to borrow moneyB) consumers hesitate to buy new homesC) people are unwilling to borrow moneyD) businesses postpone expansion | A)people are willing to borrow money |
| Which of the following is a result of tight money policy?A) people are willing to borrow moneyB) consumers are willing to buy new homesC) businesses cut back productionD) businesses are willing to expand | C) businesses cut back on production |
| Why would we want to shrink the money supply? | to control inflation |
| The first purpose of fractional reserve banking is to: | be sure banks can supply cash for demand deposits |
| If the Fed lowers the reserve requirement: | more money is avaliable to loan |
| To decrease the money suply the Fed can: | increases the reserve requirement |
| A high interest rate: | discourages borrowing |
| One problem of carrying out monetary policy is that: | there is difficulty in determining how much money is in circulation |
| One of the public goods that only the federal government provides is: | national defense |
| Museums, parks, and libraries are examples of: | merit goods |
| The federal govenment's tax credit for putting in solar panels is an example of: | regulating economic activity |
| Which program provides income for the very poor? | welfare |
| Which program provides medical care for retired workers? | Medicare |
| When the government's expenses are larger than its income, we have what kind of budget? | deficit |
| The total of all the money our government owes is the: | debt |
| When the budget calls for spending more money than is coming in, the government must raise extra funds by: | selling securities |
| Most state, local, and federal income comes from: | taxes |
| A tax paid by all people who cross a bridge is an example of: | benefits-recieved tax |
| A tax on hunting equipment that is used to provide public lands for hunting is an example of: | benefits- recieved tax |
| A property tax paid by all home owners that is used to pay for public schools is an example of: | ability-to-pay tax |
| Which of the following is a progressive tax? | federal income tax |
| which of the following is a regressive tax? | sales on food tax |
| Income that is removed from the economy by taxation or savings will: | decrease the money supply |
| What will inject money into the economy: | consumer loans |
| Supporters of fiscal policy believe that inflation can be reduced by: | increasing taxes |
| Fiscal policy can combat unemployment by: | decreasing taxes |
| When a check writer and the person he/she wrote the check both use the same bank: | the check never leaves the bank |
| Who is the cahirman of the Federal Reserve System? | Ben Bernanke |
| Monetarist theory: | opposes the use of fiscal policy |
| One criticism of fiscal policy is that: | there is a time lapse between enacting it and when it becomes effective |
| The ability to purchase things with borrowed money is called: | credit |
| The money one borrows is the: | principle |
| How do commercial banks make money: | charging interest on loans |
| What does that Fed not do? | provide services for consumers |
| The Federal Reserve is not responsible for: | taxes |
| If the Federal Reserve adopts an expansionary monetary policy: | interest rates fail & cradit is easy to get |
| John Meynard Keynes believed that government should: | use fiscal policy |
| Programs that only help the very poor are known as: | public assistance programs |
| A program that provides monthly payments to people who work, but are now retired is called: | Social Security |
| During the 1930's: | unemployment was very, very high |
| One of the major goals of stabalizing the national economy is to: | even out the business cycle |
| Monetarism is linked with the economist: | Milton Friedman |
| Fiscal policy was first used on a large scale during the: | 1930's |
| An example of a demerit good is: | cigarettes |
| When the national budget has more expenses than income, this is called: | deficit financing |
| To increase the money supply, the fed would: | buy securities |
| To decrease the money supply the Fed would: | raise the reserve requirements |
| What is not a demand deposit?A) a mortgageB) a checking account C) a savings account D) a debit card | A) a mortgage |
| The ability of money to increase when it moves from person to person is called the: | multiplier effect |
| A run on the bank occurs when: | too many people try to take their money out of the bank at the same time |
| What is the term that means it is good for individuals to save money, but bad for the economy as a whole: | the paradox of thrift |
| During which president's term have we had a budget surplus? | Clinton |
| Which activity would the government be most likely to remove all taxes from: | fishing |
| What is our Fed branch? | Dallas |
| What is the Fed branch of the Baton Rouge is: | Atlanta |
| When a check from a bank in one Federal Reserve district is deposited in a bank in another Federal reserve district, what is the first thing in the bank in which the check is deposited does: | A)credit the account to whom the check was written |
| When a person writed a check for more money than is in the person's account: | when the check writer's bank recieves the check from its Fed branch bank, it retuens it and noted that there are not enough funds to pay it |
| What economist is most closely associated with fiscal policy: | John Maynard Keynes |
| Economics is the study of how society: | fill its wants & needs |
| The basic problem of economics is: | scarcity |
| The first way people filled wants and needs was: | bartering |
| What number was part of the name of old, Spanish gold coins: | eight |
| To be value, an economic model should be correct: | most the time |
| To create economic models it is very important: | to discover cause and effect relationships |
| The country cannot achieve all its goals all the time due to: | scarcity |
| The most serious risk of start a business may be: | failure |
| What is NOT a factor of production: | profit |
| A market is the: | the voluntary exchange of goods & services |
| All people must deal with the problem of: | scarcity |
| The greatest problem with economic models is: | a huge number of variables |
| When we give up getting one thing to get another we have made a/an | trade-off |
| The more individuals save, the: | worse it is for the economy |
| Adam Smith believed that: | the economy is guided by an invisible hand if the government stays out |
| Adam Smith believed that: | people will always make choices in their own best interest |
| Karl Marx believed that: | from those according to their ability; to those according to their need |
| Which economic system has the closet family ties? | Traditional |
| Most countries have what kind of economy? | Mixed |
| Which economic system can reroute resources fastest? | Command |
| In which system is change discourage: | Traditional |
| Which economic system does not care about what happend to the poor, sick, and weak? | Market |
| Which economic system is preferred by Adam Smith? | Market |
| Which economic system is preferred by Karl Marx? | Command |
| Which economic system can combine the best of all other systems? | Mixed |
| In which system does everyone know what is expected of him? | Traditional |
| Which economic system has no incentive to work harder? | Command |
| In which economic system is one likely to do the same job as one's father? | Traditional |
| In which system can individuals become rich? | Market, or Mixed |
| Which economic system has the least consumer and producer choice? | Traditional |
| Which economic system has the most in common with the Command system? | Traditional |
| Which economic system does not work well even for short periods of time? | Command |
| The situation in which money adds income to the society everytime it is spent is the: | multiplier effect |
| Adam Smith wrote: | The Wealth of Nations |
| Karl Marx wrote: | the Communist Manifesto |
| Karl Marx lived most of his life in: | England |
| Karl Marx believed that the factors of production should be owned by: | the workers |
| Who was the first, famous economist? | Adam Smith |
| What influenced both Karl Marx and Adam Smith? | The Industrial Revolution |
| What country has a pure Command system with no elements of any other system: | North Korea; Cuba is pretty close to this |
| Price and demand are like: | a seesaw |
| Price and Supply are like: | a stalker and his victim |
| The equilibrium price is the point at which: | the supply and demand curves intersect |
| What is a substitute for whipped cream: | Cool Whip |
| What is the main reason government become involved in the economy: | to project and encourage competition |
| What can develop when the government sets price floors above the equilibrium price: | surpluses |
| What product is most likely to have elastic demand: | jeans |
| What is possible government intervention in the economy:, | price ceiling, tax policies intervention, price floors, other restrictions |
| The best example of perfect competition is: | eBay (Farmer's Market) |
| Why does the government set price floors above the equilibrium price for some products: | to prevent black markets |
| Perfect competition does not require: | different productions |
| If all the requirements of perfect competition are met, price is set by: | market forces of supply & demand |
| If the government wanted to discourage a certain activity it would: | place a high tax on it |
| The main purpose of government involvement in the economy is to: | encourage and protect competition |
| If production is below the equilibrium point, what will result | shortage |
| The best place to save money is in a: | bank |
| What country was used as a good and bad example of capitalism: | England |
| What will NOT cause the demand curve to shift: | changes in price |
| What is NOT marketing? | manufacturing |
| All the things that a bussiness owns are its: | assets |
| Merket surveys can be based on: | age, gender, income, education |
| Most advertising today tries to: | create a life-style |
| Many economists believe that marketing makes up what percentage of the price of products: | 50% |
| The first advertising was used to do what: | let people know that the product existed |
| Which bussiness does not sell to consumers? | wholesaler |
| What is another term for advertising: | marketing |
| Part of a corperation that is owned by an individual is called: | stock |
| Adds that tell the consumner that his or her life will improve if the product is used: | appeal to the emotions |
| The owner of a business is the: | proprietor |
| Business assets are: | everything that a business owns |
| What is set up for a specific purpose for a short amount of time: | joint venture |
| All businesses have: | risk |
| Offering a product for sale in a small area for a limited amount of time: | test-marketing |
| Warehouse stores, e-commerce, catalogues, and direct marketing are examples of: | sales techniques |
| Articles of incorporation do not: | list the products the corporation produces |
| Unlimited liability mean that the owner of a business may lose: | everything plus what his/her spouse owns |
| Dividends come from: | profits |
| In what form of business does the owner pay money to large corporation to get to use thier name and other services: | joint-venture corporation |
| What process gathers and analyzes data: | market research |
| Product, price, place, and promotion are: | the 4 p's of marketing |
| Another word for stock is: | share |
| The production life-cycle includes: | introduction, growth, maturity, decline |
| If a corporation goes bankrupt, the owners may lose: | what is invested in the business |
Created by:
shelbs1
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