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Level IV Economics II Blizzard Bag 2014 - 2015
1. Which of these services is provided by the national government?
A. electricity
B. military defense
C. road repair
D. fire fighters
2.
Which of the following choices best completes the above flowchart?
A. Employment and output will both decrease.
B. Output will decrease with no affect on employment.
C. Employment and output will both increase.
D. Output will stay the same with a decrease in employment.
3. When an entrepreneur starts a business, there is a risk that the business will fail. Which of
the following best explains why an entrepreneur would want to start a business?
A. The entrepreneur hopes to earn a profit.
B. The entrepreneur wants to help his or her community.
C. The entrepreneur does not have to pay taxes.
D. The entrepreneur is better at running a business than other people.
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4. By limiting the instability of inflation, the Federal Reserve Board attempts to achieve
A. low unemployment.
B. economic stability.
C. economic growth.
D. higher tax returns.
5. Imagine that in 1982, the Bureau of Labor and Statistics (BLS) published the consumer price
index at 100. Today, the index stands at 185. What is the inflation rate?
A. 1.85%
B. 85%
C. 285%
D. 15%
6.
What is the relationship shown in the chart?
A. Businesses are solely responsible for all the major inputs for households.
B. There is a shared relationship between households and businesses.
C. Households are responsible for all the goods and services of businesses.
D. There is a one-way relationship between households and businesses.
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7. The demand for all goods and services within a country is called
A. aggregate demand.
B. price elasticity.
C. comparative advantage.
D. investment.
8. Economic growth happens when increasing amounts of goods and services are produced in a
city, region, or country over the long term. How does investment impact economic growth?
A. It helps increase instability.
B. It reduces economic competition.
C. It reduces the amount of businesses.
D. It helps increase productivity.
9. Which of the following must occur in order for an entrepreneur to earn a profit?
A. The entrepreneur must have at least one hundred employees working for him or
her.
B. The products made by the entrepreneur must be sold in all fifty states.
C. The entrepreneur must create a product that no one else sells.
D. The amount of revenue the entrepreneur earns must exceed expenditures.
10. Under which policy would the nation's supply of money be allowed to grow at a slower rate
than in the past?
A. fiscal policy
B. discount rate policy
C. tight money policy
D. loose money policy
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11.
Why would an applicant with a CPA or Master's degree be preferred over a person with just a
Bachelor's degree?
A. The applicant with a higher degree will be assumed to be a better worker than
others.
B. The company needs a worker who has the qualifications to complete certain skills.
C. The firm believes only taking applicants with a CPA or Master's will make them
look prestigious.
D. The firm thinks people with Master's degrees are smarter than other workers.
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12.
Using the chart, determine the impact of household savings on the nation's output of goods
and services.
A. Household savings usually boosts national output of goods and services.
B. Household savings can boost goods and services to governments.
C. Household savings mostly impacts the cost of goods and services.
D. Household savings can slow down output of goods and services.
13. Which of the following people is most likely experiencing frictional unemployment?
A. Elizabeth was laid off from a department store after the Christmas shopping
season was over.
B. Joe is a computer programmer who can't find a job because he doesn't know how
to use some of the latest software.
C. Adam just graduated from college with an engineering degree and hasn't been able
to find a job in his field yet.
D. Rebecca lost her job at a car dealer after the dealer's sales had dropped because of
an economic downturn.
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14.
Property rights, such as copyright law, are enforced by the legal system. Explain why protecting
property rights is essential to a market economy.
A. Every individual or businesses has the right to copy other people's goods for profit.
B. The government reserves the right to automatically transfer the income to others.
C. A market economy relies on the free exchange of goods and services without rules.
D. Individuals and businesses need control over profits, use, and distribution of
goods.
15.
Which of these fits best in the empty box?
A. lower economic efficiency
B. higher standard of living
C. lower physical capital
D. higher interest rates
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16.
"Its main functions are to regulate the national money supply, set reserve requirements for
members, supervise the printing of currency at the mint, act as a clearing house for the
transfer of funds throughout the banking system and examine member banks to make sure
they meet various regulations."
www.dreyfus.com/content/dr/control
Which organization is described in the passage?
A. Office of Management and Budget
B. Federal Reserve System
C. Central Intelligence Agency
D. Office of U.S. Trade
17.
• Senator in Alabama receives $800,000 for oyster rehabilitation
• Senator in New York receives $2.2 million for the Center of Grape Genetics
• Senator in Iowa receives $1.8 for pig odor research and manure management
The actions above are considered to be
A. filibustering.
B. pork-barrel spending.
C. gerrymandering.
D. lobbying.
18. Which statement most accurately describes the relationship between human capital and
productivity?
A. Increased human capital leads to decreased productivity.
B. Decreased human capital leads to steady productivity.
C. Increased human capital leads to increased productivity.
D. Decreased human capital leads to increased productivity.
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19.
• gross: the entire amount of income before any deductions are made
• tax income: government income due to taxation
Which term describes the items above?
A. monetary policy
B. fiscal policy
C. revenue
D. sales tax
20.
In the late 1800s, railroads were the primary method for transporting people and products
across the nation. Small towns usually had only one or two rail lines. Since the railroad
companies provided the only service available, they could charge high shipping rates. The cost
of shipping short distances was often higher than shipping long distances. This especially
angered farmers and small businesses that needed the railroads to ship their goods. In 1887,
the Interstate Commerce Act was passed to regulate railroad companies. The act required
railroad companies to publish shipping rates and prohibited price discrimination against small
markets.
adapted from http://www.econedlink.org/lessons/index.php?lesson=EM694
Which is the most likely effect of the Interstate Commerce Act on small farmers?
A. It helped them be more profitable.
B. It required them to pay more fees.
C. It caused them to use different carriers.
D. It made them ship longer distances.
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