Download Unit 5

Unit 5
Economics EOC Review
Question 1
A recession is
• (a) a period of steady economic growth.
• (b) a prolonged economic expansion.
• (c) an especially long or severe economic
contraction.
• (d) a prolonged economic contraction.
Question 1
A recession is
• (a) a period of steady economic growth.
• (b) a prolonged economic expansion.
• (c) an especially long or severe economic
contraction.
• (d) a prolonged economic contraction.
Question 2
When the economy is working properly, what
is the unemployment rate?
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A. 0 to 3 percent
B. 8 to 10 percent
C. 4 to 6 percent
D. 10 to 12 percent
Question 2
When the economy is working properly, what
is the unemployment rate?
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A. 0 to 3 percent
B. 8 to 10 percent
C. 4 to 6 percent
D. 10 to 12 percent
Question 3
Which of the following is an example of a final
good or service?
• A. Wheat a bakery purchases to make bread
• B. Coffee beans a coffee shop purchases to
make coffee
• C. Lumber purchased by a construction
company to use in building houses
• D. A cake purchased from a bakery for a
wedding
Question 3
Which of the following is an example of a final
good or service?
• A. Wheat a bakery purchases to make bread
• B. Coffee beans a coffee shop purchases to
make coffee
• C. Lumber purchased by a construction
company to use in building houses
• D. A cake purchased from a bakery for a
wedding
Question 4
Which is an example of discretionary
spending?
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A. Social Security
B. Medicaid
C. Medicare
D. Education
Question 4
Which is an example of discretionary
spending?
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A. Social Security
B. Medicaid
C. Medicare
D. Education
Question 5
• What do taxes collected under the Federal
Insurance Contribution Act (FICA) fund?
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A. Social Security and Medicaid
B. Social Security and Medicare
C. Medicare and Medicaid
D. Medicaid and Supplemental Security
Income
Question 5
• What do taxes collected under the Federal
Insurance Contribution Act (FICA) fund?
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A. Social Security and Medicaid
B. Social Security and Medicare
C. Medicare and Medicaid
D. Medicaid and Supplemental Security
Income
Question 6
An example of a durable good would be
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A. a used car.
B. a box of cereal.
C. a paperback book.
D. a pack of baseball cards.
Question 6
An example of a durable good would be
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A. a used car.
B. a box of cereal.
C. a paperback book.
D. a pack of baseball cards.
Question 7
GDP expressed in constant, or unchanging,
prices is called
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A. real GDP.
B. nominal GDP.
C. price level.
D. net national product.
Question 7
GDP expressed in constant, or unchanging,
prices is called
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A. real GDP.
B. nominal GDP.
C. price level.
D. net national product.
Question 8
The lowest point in an economic contraction
is called
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A. a peak.
B. a recession.
C. a trough.
D. a depression.
Question 8
The lowest point in an economic contraction
is called
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A. a peak.
B. a recession.
C. a trough.
D. a depression.
Question 9
How does the Bureau of Labor Statistics
determine how the market basket should
change over time?
• A. by evaluating the census
• B. by conducting a Consumer Expenditure
Survey
• C. by calculating the inflation rate
• D. by computing the Consumer Price Index
Question 9
How does the Bureau of Labor Statistics
determine how the market basket should
change over time?
• A. by evaluating the census
• B. by conducting a Consumer Expenditure
Survey
• C. by calculating the inflation rate
• D. by computing the Consumer Price Index
Question 10
In a typical business cycle, what stage
immediately follows a peak?
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A. contraction
B. trough
C. expansion
D. growth
Question 10
In a typical business cycle, what stage
immediately follows a peak?
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A. contraction
B. trough
C. expansion
D. growth
Question 11
An example of a nondurable good is
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A. a new car.
B. a paperback book.
C. a used car.
D. a washing machine.
Question 11
An example of a nondurable good is
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A. a new car.
B. a paperback book.
C. a used car.
D. a washing machine.
Question12
• If Bob loses his job at the GM plant because
car manufacturing is slow due to a
downturn in the economy, you can conclude
that he is
• A. cyclically unemployed.
• B. structurally unemployed.
• C. seasonally unemployed.
• D. frictionally unemployed.
Question12
• If Bob loses his job at the GM plant because
car manufacturing is slow due to a
downturn in the economy, you can conclude
that he is
• A. cyclically unemployed.
• B. structurally unemployed.
• C. seasonally unemployed.
• D. frictionally unemployed.
Question 13
What is an entitlement?
• A. a social welfare program providing benefits to
people who meet certain eligibility requirements
• B. a social welfare program paying bills for
government spending such as supplies and utilities
• C. a social welfare program spending funds over
which legislators have direct control
• D. a social welfare program providing payments
that the government receives for certain services
Question 13
What is an entitlement?
• A. a social welfare program providing benefits to
people who meet certain eligibility requirements
• B. a social welfare program paying bills for
government spending such as supplies and utilities
• C. a social welfare program spending funds over
which legislators have direct control
• D. a social welfare program providing payments
that the government receives for certain services
Question 14
How is the federal income tax a progressive tax?
• (a) The higher the income a person has, the higher the
percentage that person pays as tax.
• (b) A person with a higher income pays more money in
taxes, although the percentage he or she pays as tax is less.
• (c) Two married people who file their taxes together will
pay more taxes than a single person will.
• (d) Children pay no taxes, regardless of whether they earn
a large income.
Question 14
How is the federal income tax a progressive tax?
• (a) The higher the income a person has, the higher the
percentage that person pays as tax.
• (b) A person with a higher income pays more money in
taxes, although the percentage he or she pays as tax is less.
• (c) Two married people who file their taxes together will
pay more taxes than a single person will.
• (d) Children pay no taxes, regardless of whether they earn
a large income.
Question 15
• What term matches the following
definition?
a general increase in prices
Question 15
• What term matches the following
definition?
a general increase in prices
Answer: Inflation
Question 16
• What term matches the following
definition?
a tax for which the percentage of income paid
in taxes remains the same for all income
levels
Question 16
• What term matches the following
definition?
a tax for which the percentage of income paid
in taxes remains the same for all income
levels
Answer: Proportional Tax
Question 17
• What term matches the following
definition?
spending on certain programs that is required
by existing law
Question 17
• What term matches the following
definition?
spending on certain programs that is required
by existing law
Answer: Mandatory Spending
Question 18
• What term matches the following
definition?
percentage of the nation’s labor force that is
not employed
Question 18
• What term matches the following
definition?
percentage of the nation’s labor force that is
not employed
Answer: Unemployment Rate
Question 19
• What term matches the following
definition?
taking tax payments out of an employee’s pay
before he or she receives it
Question 19
• What term matches the following
definition?
taking tax payments out of an employee’s pay
before he or she receives it
Answer: Withholding