Economics Flashcards
Which two factors drive demand in a microeconomic system?
Choose 2 answers
Production
Component shortage
Price of substitute goods
Customer preference
Price of substitute goods
Customer preference
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
Demand curve
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
Demand increases
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
Economy expands
Personal wealth increases
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
To encourage bankers to make loans
To cut the cost of borrowing
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
-A rise of interest rates on these securities
-An increase in overall cost of debt to private borrowers
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
C) Fiscal policy ✅
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
A) Seasonal unemployment ✅
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
B) Structural unemployment ✅
A specific economic situation when price and demand rise together is called:
A) Inflation
B) Deflation
C) Recession
D) Stagnation
A) Inflation ✅
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
A) Reduce spending ✅
As a business, which environment is best to make capital improvements?
A) High-inflation
B) Economic downturn
C) Low-inflation
D) Market saturation
C) Low-inflation
Which type of competition requires government regulation for entry?
A) Oligopoly
B) Monopoly
C) Perfect competition
D) Monopolistic competition
B) Monopoly ✅
Which type of competition is the easiest to enter?
A) Monopolistic competition
B) Oligopoly
C) Pure competition
D) Monopoly
C) Pure competition ✅
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
B) Demand curve ✅
What is the point where supply and demand curves intersect?
A) Demand surplus
B) Supply shortage
C) Equilibrium price
D) Price floor
C) Equilibrium price ✅
Is the study of supply and demand a micro or macroeconomic issue?
A) Microeconomics
B) Macroeconomics
C) Both
D) Neither
A) Microeconomics ✅
When federal taxes are reduced, is that a micro or macroeconomic issue?
A) Microeconomics
B) Macroeconomics
C) Business finance
D) Local economy
B) Macroeconomics ✅
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
D) Macroeconomics ✅
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
C) Demand curve
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
A) Customer preference ✅D) Price of substitute goods ✅
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
Demand Increases
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
B) Economy expands ✅
D) Business profits rise ✅
E) Personal wealth increases ✅
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
B) To encourage bankers to make loans ✅
D) To cut the cost of borrowing ✅
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
A) An increase in overall cost of debt to private borrowers ✅
B) A decrease in borrowing costs for businesses
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
A branch of economics that studies individual and firm decision-making
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
All of the above
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
How households and firms make choices, how they interact in markets, and how the government attempts to influence their choices
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
The study of economy-wide phenomena, including inflation, unemployment, and economic growth
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
Fiscal policy
A specific economic situation when price and demand rise together is called:
A) Deflation
B) Inflation
C) Equilibrium
D) Economic stagnation
Inflation
Which type of competition requires government regulation for entry?
A) Perfect competition
B) Monopoly
C) Oligopoly
D) Monopolistic competition
Monopoly
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
A facility that produces goods with 100% automation
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
The study of individual and firm behavior in allocating scarce resources
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
Economy-wide phenomena, including inflation, unemployment, and economic growth
Which policy is used to manage the economy using government spending and taxation?
A) Monetary
B) Fiscal
C) Trade
D) Supply-side
Fiscal
Which policy is used to manage the economy using government spending and taxation?
A) Fiscal
B) Monetary
C) Trade
D) Industrial
Fiscal
A specific economic situation when price and demand rise together.
A) Deflation
B) Stagflation
C) Inflation
D) Recession
Inflation
Which type of competition requires government regulation for entry?
A) Oligopoly
B) Perfect competition
C) Monopoly
D) Monopolistic competition
Monopoly
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
Demand curve
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
Price of substitute goods
Customer preference
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
Demand increases
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
Economy expands
Personal wealth increases
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
To encourage bankers to make loans
To cut the cost of borrowing
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
A rise of interest rates on these securities
An increase in overall cost of debt to private borrowers
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
The study of smaller economic units such as individual consumers, families, and individual businesses
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
A market structure where there are a large number of buyers and sellers who each have significant control over price
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
The rate of inflation excluding the effects of food and energy prices
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
Government policy that attempts to manage the economy by controlling the money supply and thus interest rates
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
Policy that reduces the money supply to curb rising prices, over-expansion, and concerns about overly rapid economic growth
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
The study of how choices people and governments make when allocating resources
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
The establishment of effective quality systems
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
Price of substitute goods, customer preference
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
Demand increases
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
Encourage bankers to make loans, cut the cost of borrowing
