Economics

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Economics

The biggest difference between communism and socialism concerns

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How they decide what to produce

Their political systems

How they allocate their resources

Their location in the world today

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The following describes a proportional tax:

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The tax amount stays the same no matter what income level

The tax rate stays the same no matter what income level

The tax rate rises as income rises

The tax amount goes down as income rises

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Which of the following is an important advantage of the corporate form of business organization?

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Corporations are easy to organize

Corporations are able to gather large amounts of money

Corporations have unlimited liability

Corporation’s maximum tax rate is lower

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Import permits which nations use to regulate the level of imports by individual businesses are called

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Tariffs

Licenses

Quotas

Surcharges

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Which of the following best demonstrates opportunity cost?

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Your teacher decides to assign an essay for homework

Your mother listens to the radio as she cooks supper

Your sister chooses to read a book instead of cleaning her room

You forget to bring a pencil or pen to class

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If a good or service is scarce, it becomes

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Easy to locate

Undesirable to consumers

Valuable in terms of money

Capable of satisfying wants and needs

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An incompetent employee and customers who shoplift are both examples of________ risks.

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Human

Natural

Economic

Capital

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Adam Smith’s theory that people’s self-interest leads them to do what is best for themselves and for the economic society as a whole is known as

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Theory to Choose

Theory Z

Invisible Hand

None of the above

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Interlocking directorates occur when

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Companies charge different buyers different prices for the same product

The majority of members of the boards of directors of competing corporations are the same

Both A and B

None of the above

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Pure competition

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Means there are very few buyers in the market

Results in buyers and sellers cooperating

Means there are few sellers in the market

Means there are many buyers and sellers in the market

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The price of soccer balls is likely to be increased by

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New machines and technology reducing the cost of production

More capital investment by producers

A decrease in the demand for soccer balls

A decrease in the supply of soccer balls

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The demand curve for a firm in a competitive environment is

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Unit elastic

Inelastic

Perfectly inelastic

Perfectly elastic

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The marginal tax rate is the rate on the

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First dollar of income

First dollar of spending

Last dollar of income

Last dollar or spending

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The amount of work you do in a period of time and the frequency with which you do it is

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Scope

Depth

Scope and depth

Production

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The effective working of competitive markets require

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A high degree of specialization

Full information of consumers and producers

Limits on the profit motive

Decreased spending for new road and highway production

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Which strategy is likely to reduce unemployment?

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Higher taxes

Reduces government spending for military and space exploration

Lower taxes

Decreased spending fore new road and highway construction

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The basis of the U.S. economy is

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the banking system

the auto industry

the market

credit

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Prices to be charged for natural gas, electricity, and local telephone service in a state are set by

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Legislature

Antitrust law

Public service commission

Corporation

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The effects of minimum wage laws are

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Always positive

A hindrance to technology development

Both positive and negative

None of the above

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A firm in capitalism will hire a worker if he or she

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Needs a job

Buys the product the firm produces

Increases their profit

Has skills or training

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A lower price most likely indicates

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more scarcity.

less scarcity.

no scarcity.

a shortage.

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The primary source of tax revenues for most states is

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sales and excise taxes.

property taxes.

corporate income taxes.

state personal income taxes.

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In competitive markets, the long-run economic profit is

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zero.

less than zero.

greater than zero.

equal to average cost.

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Pollution is an example of

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externality benefit.

externality cost.

taxes.

spillover benefit.

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Suppose crude oil prices rise, what is the likely effect on gasoline a product made from crude oil?

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Supply of gasoline increases

Gasoline prices decrease

Supply of gasoline decreases

No effect on gasoline prices

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When supply increases, the equilibrium quantity will

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decrease.

be an unknown.

stay the same.

increase.

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The minimum wage is an example of

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a shortage of workers.

a price ceiling.

a price floor.

a surplus of jobs.

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A share in the ownership of a corporation is called a

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mutual fund.

stock.

bond.

REIT.

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A company that produces tires and greeting cards is an example of

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a diagonally integrated firm.

a vertically integrated firm.

a horizontally integrated firm.

a conglomerate.

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Investment spending is unstable because

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households view investing as discretionary spending.

households are uncertain about the future.

households hold onto money during recessions.

firms can postpone buying capital because it is durable.

Clear selection

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