Download MoneyWise Teen Contest Post Test 1. Which of the following best

MoneyWise Teen Contest
Post Test
1. Which of the following best summarizes the concept of scarcity?
a. Life is not fair.
b. You can’t have everything you want.
c. People are selfish.
d. Life is so hard.
2. A decision always involves:
a. money
b. at least two alternatives
c. goods or services
d. income
3. Whenever you make a choice, you face a(n):
a. High cost
b. Low cost c. Opportunity cost
d. Sunk cost
4. Marginal analysis involves:
a. Looking at the benefits of an alternative
b. Looking at the cost of an alternative
c. Comparing the benefits of two alternatives
d. Evaluating the cost of an alternative
5. When deciding how much of something to do or buy, people compare the marginal benefit
from different levels of the activity to the:
a. Average opportunity cost
b. Marginal opportunity cost
c. Total opportunity cost
d. Sunk opportunity cost
6. Decisions should only be made after carefully comparing the ___________ and
___________ of alternatives.
a. Benefits and cost
b. Benefits and advantages
c. Cost and disadvantages
d. Aims and goals
7. In a competitive market, which of the following is NOT true about the price of a product?
The price
a. provides information to demanders and suppliers.
b. reflects the relative scarcity of the product.
c. reflects the moral value of the product.
d. is determined by demand and supply.
5. The number that indicates the relative scarcity of a product is the:
a. price
b. supply
c. demand
d. quantity
6. Human capital is a person’s
a. skills and knowledge
b. money
c. land
d. time
7. In a competitive labor market, your wage is determined by:
a. the government
b. supply of your particular labor
c. demand for your particular labor
d. supply of and demand for your particular labor
8. People’s lifetime incomes depend primarily on their:
a. popularity in school
b. athletic ability
c. human capital
d. luck
9. In terms of human capital, school and other forms of training are:
a. opportunities to make friends
b. opportunities to play sports
c. investment
d. consumption
10. Assume that you earn $25,000 per year. What percentage of your income is likely to be
subtracted for taxes, social security and other deductions, and how much “take home pay”
will that leave you?
a. 1% deducted, $24,750 take home pay
b. 10% deducted, $22,500 take home pay
c. 30% deducted, $17,500 take home pay
d. 50% deducted, $12,500 take home pay
11. Which of the following will increase the value of your saving over time?
a. higher interest rates
b. higher interest tax rates
c. lower amount of saving
d. higher inflation rates
12. Which of the following will decrease the value of your saving over time?
a. higher amount of saving
b. higher inflation rates
c. lower interest tax rates
d. lower inflation rates
13. Which of the following are alternatives.
a. wearing your brother’s old clothes instead of buying new ones
b. going to a trade school instead of college
c. sending money home instead of spending it
d. all are alternatives
14. Which of the following will increase the value of saving?
a. lower interest rates
b. higher taxes
c. greater amount saved
d. shorter time period for saving
15. Which of the following measures the strength of buyers’ response to price changes?
a. demand
b. supply
c. price elasticity of supply
d. price elasticity of demand
16. Amanda wants to play soccer and also work at McDonald’s. She cannot do both so she
decides to play soccer. What is her opportunity cost?
a. playing soccer
b. being with her friends
c. working at McDonald’s
d. playing a different sport
17. Budgeting only makes sense when:
a. your wants exceed your resources
b. you are poor
c. you want lots of things
d. you have a family
18. Which of the following is an example of marginal analysis?
a. Comparing the benefits of running an extra mile with the benefits of eating lunch
b. Going to a movie
c. Buying the dress that you have been wanting for a long time
d. Eating a huge ice cream sundae
19. Assume that you earn $25,000 per year. What percentage of your income is likely to be
subtracted for taxes, social security and other deductions, and how much “take home pay”
will that leave you?
a. 1% deducted, $24,750 take home pay
b. 10% deducted, $22,500 take home pay
c. 30% deducted, $17,500 take home pay
d. 50% deducted, $12,500 take home pay
20. Which of the following occurs in the market for flashlights when a power outage occurs
that is likely to last for several days?
a. demand for flashlights decreases
b. price of flashlights rises
c. flashlights becomes relatively less scarce
d. supply decreases