Course Introduction
Business Economics
Test Preparation
Business Economics explores the application of economic theory and quantitative methods to business decision-making. The course examines how microeconomic and macroeconomic principles influence firms strategies, resource allocation, pricing, production, and investment decisions within various market environments. Students will analyze market structures, consumer behavior, cost and revenue analysis, and the impact of government policies on businesses. Emphasis is placed on using economic reasoning to solve real-world business problems and to evaluate the broader economic environment in which companies operate.
Recommended Textbook
Macroeconomics 10th Edition by Stephen Slavin
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19 Chapters
5438 Verified Questions
5438 Flashcards
Source URL: https://quizplus.com/study-set/3248
Page 2
Chapter 1: A Brief Economic History of the United States
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258 Verified Questions
258 Flashcards
Source URL: https://quizplus.com/quiz/64528
Sample Questions
Q1) The creation of the dust bowl and the migration of the "Okies" to California took place in the
A)1920s.
B)1930s.
C)1940s.
D)1950s.
E)1960s.
Answer: B
Q2) Which is the most accurate statement?
A)In the years after World War II,millions of blacks moved to the suburbs.
B)No new homes were sold to black families in the Levittowns built in New York,New Jersey,Pennsylvania,and Maryland.
C)Today most of the communities built by the Levitt family are overwhelmingly black.
D)Although racial discrimination did take place in housing in the years immediately after World War II,by the early 1960s it was no longer taking place.
Answer: B
Q3) Between 1921 and 1929 national output rose about ______%.
Answer: 50
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3
Chapter 2: Resource Utilization
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265 Verified Questions
265 Flashcards
Source URL: https://quizplus.com/quiz/64527
Sample Questions
Q1) Which statement about entrepreneurship in America is true?
A)Alexander Graham Bell and Thomas Edison were two of the most famous American inventors who became entrepreneurs.
B)The American entrepreneur led the way to the country's economic success.
C)Often the entrepreneur is an innovator.
D)The vast majority of entrepreneurs in America either work for themselves or have just one or two employees.
E)All of the statements are truE.
Answer: E
Q2) In order to raise our rate of economic growth we would need to
A)increase the level of capital.
B)reduce the level of labor.
C)spend more on military goods.
D)spend more on consumer goods.
Answer: A
Q3) The Other America,which challenged the notion that we had conquered poverty,was written by __________.
Answer: Michael Harrington
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4
Chapter 3: The Mixed Economy
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262 Verified Questions
262 Flashcards
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Sample Questions
Q1) In a capitalistic economic system,who owns most of the nation's resources?
A)Labor unions
B)The government
C)Private individuals
D)No one
Answer: C
Q2) Which statement is false?
A)Under our economic system,most of the important decisions are made in the market place.
B)In our economy the price mechanism determines the answers to our three basic questions-what,how,and for whom.
C)Most economists would agree that the price system leads to a very efficient allocation of resources.
D)None of these statements are false.
Answer: D
Q3) In a capitalist country most resources are owned by
A)business firms.
B)households.
C)the government. Answer: B
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Chapter 4: Supply and Demand
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255 Verified Questions
255 Flashcards
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Sample Questions
Q1) Which situation below would represent a shortage in the oil market?
A)Quantity demanded is 5.2 million;quantity supplied is 5.1 million.
B)Market price $75.00 per barrel;equilibrium price $81.00 per barrel.
C)Market price $81.00 per barrel;equilibrium price $75.00 per barrel.
D)Quantity supplied this year is 25% greater than quantity supplied last year.
Q2) The supply curve slopes or curves _____.
Q3) Price always tends toward its ______________ level.
Q4) In the graph shown above,if the government set a price ceiling of $26,
A)there would be a permanent shortage,at least until the price ceiling was lifted.
B)there would be a temporary shortage,then the price would fall to equilibrium price.
C)price would rise to the equilibrium price.
D)price would immediately fall to the equilibrium price.
Q5) The law of supply
A)states that price and quantity supplied are inversely related.
B)states that price and quantity supplied are directly related.
C)is identical to the law of demand.
D)None of these choices are correct.
Q6) Equilibrium quantity is _____.
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Chapter 5: The Household Consumption Sector
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312 Verified Questions
312 Flashcards
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Sample Questions
Q1) As a nation we have been
A)Consuming too much and saving too much.
B)Consuming too little and saving too little.
C)Consuming too much and saving too little.
D)Consuming too little and saving too much.
Q2) In this graph,consumption is at the level of 2,500 when disposable income is A)0.
B)1000.
C)2000.
D)3000.
E)4000.
Q3) At what level of disposable income is induced consumption zero?
Q4) An increase in disposable income will
A)decrease autonomous consumption.
B)increase autonomous consumption.
C)decrease total consumption.
D)increase total consumption.
Q5) How much is induced consumption when disposable income is $20 billion?
Q6) How much is the APS?
Q7) When disposable income is 2000,how much is consumption?
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Chapter 6: The Business Investment Sector
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295 Verified Questions
295 Flashcards
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Sample Questions
Q1) The MPC is A).2.
B).3.
C).4.
D).5.
E).6.
Q2) During recessions the capacity utilization rate tends to A)rise.
B)fall.
C)stay about the same.
Q3) Investment,as the term is used in economics,does NOT include
A)General Motors' purchase of a new IBM mainframe computer.
B)an annual increase in the inventory of canned peas at Brown's Corner Grocery.
C)the purchase of a parcel of land in order to realize future financial gains when the land is sold.
D)the purchase of two new Boeing jetliners by Delta Airlines.
E)the construction of condominiums in Fort LauderdalE.
Q4) How much was the capital stock on 12/31/98?
Q5) If a group of investors wanted to gain control of a publicly held corporation,it would buy that corporation's ________.
Page 8
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Chapter 7: The Government Sector
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301 Verified Questions
301 Flashcards
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Sample Questions
Q1) An average tax rate of 20 percent on the poor and 1 percent on the rich would be
A)progressive.
B)proportional.
C)regressive.
Q2) Suppose Stockton earns $30,000 per year and Malone earns $60,000 per year.Which of the following statements is FALSE concerning their Social Security taxes?
A)Both will pay a Social Security tax.
B)Stockton will pay Social Security tax on all of his income.
C)Malone will pay Social Security tax on the majority of his income.
D)Stockton and Malone will pay the same Social Security tax rate on their incomes.
Q3) Which statement is the most accurate?
A)Most taxes are proportional taxes.
B)Poor people bear most of the burden of progressive taxes.
C)John Stuart Mill was the first to make the distinction between direct and indirect taxes.
D)President Reagan was largely responsible for raising personal income tax rates.
Q4) We spend _____ of our GDP on foreign aid.
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Page 9
Chapter 8: The Export-Import Sector
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177 Verified Questions
177 Flashcards
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Sample Questions
Q1) Which of the following were prominent among the protesters at the WTO meeting in Seattle in late 1999?
A)International bankers that free trade undermined underdeveloped nation's ability to pay back loans.
B)Environmentalists concerned that corporations would locate in countries that had very lax environmental standards.
C)Multinational corporations concerned that free trade condoned sweatshop working conditions.
D)All of the choices were prominent in the Seattle protest.
Q2) Which of the following were prominent among the protesters at the WTO meetings since 1999?
A)Labor union members concerned that free trade undermined worker rights to organize.
B)Environmentalists concerned that corporations would locate in countries that had very lax environmental standards.
C)Human rights advocates concerned that free trade condoned sweatshop working conditions.
D)All of the answers are true.
Q3) The World Trade Organization has about ________ members.
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Page 10
Chapter 9: Gross Domestic Product
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336 Verified Questions
336 Flashcards
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Sample Questions
Q1) Intermediate products are
A)goods that are purchased by the government.
B)goods that are transferred to the states.
C)products produced by the federal government but consumed by the states.
D)products produced by business firms for resale to other firms for further processing before sold to the final consumer of the product.
Q2) From one year to the next suppose GDP rises and the GDP deflator falls between those years.
A)Real GDP must have fallen.
B)Real GDP must have risen.
C)Real GDP must have remained the same.
D)There is not enough information to determine whether real GDP rose,fell,or remained the same.
Q3) Taking the expenditures approach to GDP,the largest component is _____ and the smallest component is ___.
Q4) If GDP and real GDP grew at exactly the same rate,then there would be no ___.
Q5) When there is deflation,GDP will be _____ than real GDP.
Q6) Find net domestic product.
Q7) If GDP rises,real GDP _____ rise.
Page 11
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Chapter 10: Economic Fluctuations, unemployment, and Inflation
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394 Verified Questions
394 Flashcards
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Sample Questions
Q1) If the CPI is 85,by what percent did prices decline since the base year?
Q2) In the song "My Hometown" by Bruce Springsteen,the foreman at the textile mill by the railroad tracks says,"These jobs are leaving.....and they ain't comin' back." This is an example of
A)frictional unemployment.
B)cyclical unemployment.
C)structural unemployment.
D)seasonal unemployment.
Q3) In the 1990s the misery index was
A)between 5 and 12.
B)between 12 and 19.
C)between 19 and 26.
D)between 26 and 33.
E)between 33 and 40.
Q4) The most severe recession since WWII was in
A)1973-1975.
B)1981-1982.
C)2007-2008.
D)1991-2001.
Q5) In the 1970s our economy suffered from _____ and ____.
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Chapter 11: Classical and Keynesian Economics
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241 Verified Questions
241 Flashcards
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Sample Questions
Q1) In the classical theory of the employment an increase in the rate of interest will ______ savings and ________ investment.
Q2) Keynes and the classicals used _____ aggregate demand and supply apparatuses and came to _____ conclusions.
A)the same;the same B)different;different
C)the same;different D)different;the same
Q3) For Keynes,the most important determinant of employment and output is ____.
Q4) Increases in aggregate demand
A)lead to increases in real interest and unemployment rates if there is considerable excess capacity in the economy.
B)result only in inflation when the economy operates at its maximum productive capacity.
C)may be caused by ever-greater downward pressures on prices and wages if reserve requirements are raised.
D)may be caused by an increase in taxes.
E)increase both inflation and the unemployment rates.
Q5) Aggregate supply is ____________.
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Chapter 12: Fiscal Policy and the National Debt
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377 Verified Questions
377 Flashcards
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Sample Questions
Q1) The public debt is the sum of all of the previous
A)expenditures of the federal government.
B)budget deficits of the federal government.
C)budget deficits less the budget surpluses of the federal government.
D)budget surpluses less the budget deficits of the federal government.
Q2) A)Given the information above,if full employment GDP were 2,300,would there be an inflationary gap or a recessionary gap? B)What two fiscal policy measures would you recommend to remove that gap?
Q3) If the economy dips into a recession
A)automatic stabilizers will cause tax receipts to fall and transfer payments to rise.
B)automatic stabilizers will cause tax receipts to rise and transfer payments to fall.
C)discretionary fiscal policy will generate increased transfer payments and lower tax receipts.
D)discretionary fiscal policy will reduce government outlays and increase tax receipts.
E)nothing will happen to the federal budget unless the President and Congress take specific corrective action.
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Chapter 13: Money and Banking
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278 Verified Questions
278 Flashcards
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Sample Questions
Q1) Statement I: As interest rates rise,in the long run people tend to hold less money.
Statement II: As the rate of inflation rises in the long run,people tend to hold more money.
A)Statement I is true and statement II is false.
B)Statement II is true and statement I is false.
C)Both statements are true.
D)Both statements are false.
Q2) It is generally agreed that when the rate of monetary growth exceeds the rate of growth in real GDP in the long run
A)the inflation rate will increase every year by a constant rate.
B)real GDP will grow at a faster rate.
C)the average price level will tend to decrease over time.
D)the average price level will tend to increase over time.
E)the inflation rate will decrease every year until it ultimately equals zero.
Q3) Which of the following countries have the most banks in the top 10 in the world?
A)The United States
B)France.
C)United Kingdom.
D)Germany.
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Chapter 14: The Federal Reserve and Monetary Policy
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365 Verified Questions
365 Flashcards
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Sample Questions
Q1) An individual bank can create deposits to the extent of its _________.
Q2) The reserve requirement for time deposits with original maturities of less than 18 months is _____%.
Q3) Even though the monetary policy is very quick recognize and respond to the coming of a recession than fiscal policy,it has proven in the 2000's to be less affective in avoiding or bring the economy out of the recession because
A)Increased investment by the private sector has not been forthcoming in response to the reduction in interest rates.
B)Consumers have tended to increase saving and decrease consumption.
C)Our economy has increased imports during recessions.
D)The government has imposed fiscal policy to counteract the monetary policy.
Q4) The Federal Reserve System
A)regulates not only banks but some of the other financial institutions.
B)is directly controlled by the President.
C)regulates all financial institutions in the United States.
D)controls the fiscal policy of the federal government.
Q5) Control of the Federal Reserve is held by the _________.
Q6) The monetary policy weapon least often used by the Fed is ___________.
Q7) The concept of the liquidity trap was formulated by ____________.
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Chapter 15: A Century of Economic Theory
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308 Verified Questions
308 Flashcards
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Sample Questions
Q1) The ___________ school holds that all inflations are caused by excessive growth in the money supply and that monetary policy affects GDP directly.
Q2) The main problem we had during the Great Depression,said John Maynard Keynes,was inadequate _______.
Q3) The __________ believe that the supply of money should be increased at a constant rate each year.
Q4) According to many modern monetarists
A)the government can minimize economic instability by stabilizing growth of the money supply at a constant low rate.
B)short-run variations in an economy's productive capacity can be predicted precisely.
C)discretionary monetary policy enables the Federal Reserve System to closely control the economy.
D)the money supply should grow at a rate determined by short-run economic fluctuations.
E)history has proven that fine-tuning fiscal and monetary policy is both possible and practical.
Q5) The monetarists advocate increasing the money supply by about ________% a year.
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Chapter 16: Economic Growth and Productivity
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231 Verified Questions
231 Flashcards
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Sample Questions
Q1) In recent years,our rate of productivity growth very rarely attains a rate of ____ percent.
A)1
B)3
C)5
D)7
E)9
Q2) The U.S.spends _____ percent of our GDP on health care,while Canada spends ______ percent of their GDP on health care.
Q3) For a country in the process of development,a high saving rate is generally
A)helpful,because it makes resources available for investment.
B)helpful,because it causes a rapid growth of aggregate demand and thus makes it easier to capture economies of scale.
C)harmful,because it causes a stagnation of aggregate demand.
D)harmful,because it promotes imports of consumer goods.
E)unimportant;there is no observable relationship (either positive or negative)between saving and growth.
Q4) Thomas Robert Malthus predicted that any given nation's population would double every _____ years.
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Chapter 30: Income Distribution and Poverty
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285 Verified Questions
285 Flashcards
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Sample Questions
Q1) Statement I.There is no basis for saying that in the U.S.the rich are getting richer and the poor are getting poorer.
Statement II.The U.S.has one of the most equal distributions of income in the world.
A)Statement I is true and statement II is false.
B)Statement II is true and statement I is false.
C)Both statements are true.
D)Both statements are false.
Q2) The welfare rolls in the United States shot up most dramatically during the period
A)1945-1949
B)1960-1964
C)1980-1984
D)1986-1990
E)1990-1994
Q3) What is the percentage of the lower two quintiles earned on line Y?
Q4) What is the percentage of income received by the middle three quintiles on line X?
Q5) Between 1994 and 2000 the poverty rate _______________ and the number of people on welfare _______________.
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Page 19
Chapter 31: International Trade
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268 Verified Questions
268 Flashcards
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Sample Questions
Q1) Statement I: Our trade deficit in 2009 with Japan was greater than our trade deficit with China.
Statement II: Our negative merchandise trade balance is about as large as our services trade (positive)balance.
A)Statement I is true and statement II is false.
B)Statement II is true and statement I is false.
C)Both statements are true.
D)Both statements are false.
Q2) If a nation has a comparative advantage in the production of good X,this means that the nation
A)cannot benefit by producing and trading this product.
B)gives up less of alternative goods than other nations in producing a unit of X.
C)has a production possibilities curve identical to those of other nations.
D)is not subject to opportunity costs in producing good X.
Q3) In 2009,we had a trade deficit of over $200 billion with A)Japan.
B)China.
C)Japan and China.
D)neither Japan nor China.
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Page 20
Chapter 32: International Finance
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230 Verified Questions
230 Flashcards
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Sample Questions
Q1) Our current account balance in 2009 was a
A)surplus of about $220 billion.
B)surplus of about $420 billion.
C)deficit of about $220 billion.
D)deficit of about $420 billion.
Q2) If 1 U.S.dollar exchanges for 7.0 Chinese Yuan,how much would it cost in U.S.dollars and cents to purchase a Chinese toy priced at 140 Yuan?
Q3) A depreciation of the dollar will
A)discourage foreigners from buying U.S.goods.
B)encourage Americans to invest in foreign assets.
C)increase the amounts of U.S.dollars demanded by foreigners.
D)throw the U.S.economy into a recession.
E)lower the U.S.prices of imports.
Q4) Our balance of trade is part of our _______________.
Q5) A nation can finance a deficit on its current account with A)a surplus on its capital account.
B)a deficit on its capital account.
C)official purchases of foreign currencies with its own currency.
D)purchases of gold from foreign currencies with its own currency.
Q6) Most of the world's nations went off the gold standard in the year _________.
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