3 Econ NINJA QUIZ

3 Ninja QUIZ

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Question 1

When the US government purchases a submarine from a company, the government has made a major transaction in the

factor market

Product market

Foreign exchange market

Question 2

A volcano in Hawaii erupts and destroys orchards that supply the US with Pineapples. What would be the effect on price and quantity sold, assuming all else is equal?

Price will rise and quantity will also rise

Price will drop and quantity will also drop

Price will rise but quantity will drop

Question 3

What is the basic principals of the law of demand?

The higher the price, the more people will want the good

The higher the price, the less people will want the good

The higher the price, the more goods that will be supplied

Question 4

What happenes when the supply of a good is greater than the consumer wants to buy?

The good is discarded

Either the good remains unsold or the price drops.

Either the good is saved for later sale or the price is raised

Question 5

What is most likely true if there is low unemployment?

High inflation

Reduced prices for goods and services

An increase in the supply of goods and services

Question 6

The best example of structural unemployment in an economy is someone . . .

Whose jobs skills do not match the economy's needs

Out of work due to a seasonal downturn

Out of work due to a change in the business cycle

Question 7

Which of the following results when federal government's expenses are less than the federal government's total income?

A trade surplus

A federal budget deficit

A federal budget surplus

Question 8

How is the monetary policy different from fiscal policy?

Monetary policy involves the money supply, while fiscal policy involves the governemtn taxing and spending

Fiscal policy involves the money supply, while monetary policy involves government taxing and spending

Fiscal policy involves specific steps taken to carry out the overall monetary policy

Question 8

How is the monetary policy different from fiscal policy?

Monetary policy involves the money supply, while fiscal policy involves the government taxing and spending

Fiscal policy involves the money supply, while monetary policy involves government taxing and spending

Fiscal policy involves specific steps taken to carry out the overall monetary policy

Question 9

A recession is a period of

Decreasing GDP and national income

Increasing taxation

Decreasing government spending

Question 10

If the government's fiscal policy is designed to end a recession, which action would congress be MOST likely to take?

Raise income tax

Lower income tax

Reduce government spending

Question 11

If Congress decides to decrease government spending and increase taxes as a part of their fiscal policy, what problem might they be trying to address?

High unemployment

Low GDP growth

High inflation

Question 12

The ups and downs that the nation's economy goes through are referred to as what?

Circular flow

ExpansionBusiness cycle

Expansion

Question 13

GDP, Inflation, and the Unemployment rate are all what?

Economic indicators used to determine the state and direction of the economy

Signs the ecomomy is peaking

Elements of monetary policy

Question 14

Which group in the US establishes Monetary Policy?

The Federal Reserve

The Senate

The President's Cabinet

Question 15

In order to encourage economic growth, it is decided that the Fed will increase the money supply and lower interest rates. This is an example of . . .

Monetary Policy

Fiscal Policy

Investment Spending

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