Download EOCT Study Guide for Economics

EOCT Study Guide for Economics
This is NOT an exhaustive list, but should refresh your knowledge.
Unit I Fundamental Economic Concepts
SSEF1
1. What is economics?
2. What is scarcity?
3. What are the three basic economic questions each society must answer?
4. What are the four productive resources? Give examples of each.
5. What are some strategies for allocating resources? ( rationing devices)
6. What are opportunity costs? Give examples.
SSEF2
7. What is cost benefit analysis?
8. What is a ppf or pp curve? What does it illustrate?
9. How can we see economic growth, or inefficiency in a ppf?
10. Be able to draw a ppf given a set of data.
11. What is a market?
SSEF3
12. What is a market? How does voluntary trade increase satisfaction of both parties?
13. How do individuals and businesses specialize?
SSEF4
14. What are the characteristics of the following economic systems: command, market, and mixed?
15. Be able to compare the economic systems in regard to the following:
a. Private ownership
b. Profit motive
c. Consumer sovereignty
d. Competition
e. Government regulation
16. How do the different systems meet the broad social and economic goals of
freedom, security, equity , growth, efficiency, and stability?
SSEF5
17. What is the role of government in market economies?
18. What are some examples of government regulation in market economies? Their effects?
SSEF6
19. What is productivity?
20. Give examples of how investment in equipment and technology can promote economic growth.
21. Give examples of how investment in education can lead to higher standard of living. ( not just for
the individual, but for society as a whole)
Unit II Microeconomics
SSEMI 1
22. Illustrate the circular flow diagram and all it’s parts. Know how the real flow and the money flow
move through the economy.
23. What is the role of money and how does it facilitate exchange?
24. What is the Law of Demand?
25. What is the Law of Supply?
26. What are the things that influence prices?
27. What are the determinants of demand?
28. What are the determinants of Supply?
29. What is the difference between a change in demand and a change in Quantity demanded?
Common mistake
30. What is the difference between a change in Supply and a change in quantity supplied?
Common mistake
31. Draw Supply and Demand Curves and label equilibrium price and quantity.
32. Be able it identify what happens to price and quantity when curves shift.
33. How are prices incentives to consumers and producers?
SSEMI 2
34. What are price floors and ceilings?
35. Be able to identify price floors and ceilings on graphs.
36. What are the reasons for implementing price floors and ceiling?
37. What are the potential effects on the market of price floors and ceilings?
38. What are surpluses and shortages? What are some causes?
39. What is price elasticity of demand? Supply?
40. What types of items are considered elastic? Inelastic?
SSEMI 3
41. What are the four types of market structures and their characteristics?
42. Compare the following types of business structures: sole proprietorship, partnership, corporation
and the advantages and disadvantages of each.
43. How does profit serve as an incentive for the entrepreneur?
Unit III Macroeconomic Indicators
SSEMA 1
44. How is overall economic activity measured? (the economic indicators)
45. What is GDP and how is it calculated?
46. What is economic growth?
47. What is unemployment? The four different types? How is it calculated? How does
unemployment affect economic growth and why?
48. What is inflation? How is it calculated?
49. What is stagflation?
50. What is the CPI?
51. What is aggregate supply and aggregate demand?
52. Be able to identify how shifts in aggregate supply and demand affect inflation and economic
growth on graphs.
53. What is the business cycle? What are the different stages in the Bus. Cycle? How is each stage
described?
54. What is a recession?
55. What is a depression?
56. What is the national debt?
57. What is a government deficit?
58. Describe the different types of taxes: proportional, progressive, regressive.
Give examples of each. ( This does not go with this standard, but we studied it
during this unit. It goes with SSEPF3)
Unit III Monetary and Fiscal Policy
SSEMA 2
59. What is the Federal Reserve?
60. What is the structure and organization of the Fed?
61. What is Monetary Policy? What are the tools of monetary policy?
62. What are expansionary and contractionary policy actions? When would
they be used?
63. Be able trace the impact of Federal Reserve actions on the Aggregate Demand and Aggregate
Supply model.
64. How do Fed actions promote price stability, full employment and economic growth?
SSEMA 2
65. What is fiscal policy?
66. What tools are used to conduct fiscal policy?
67. Explain how expansionary and contractionary fiscal policy affect the aggregate demand and
aggregate supply model.
68. Give examples of both expansionary and contractionary fiscal policy. When might each be used?
69. What automatic and discretionary fiscal policies? Give examples of each.
Unit IV International Economics
SSEIN 1
70. Why do nations trade?
71. What is absolute advantage?
72. What is comparative advantage?
73. What is balance of trade?
74. What is balance of payments?
SSEIN 2
75. What are trade barriers?
76. Define the following types of trade barriers:
Tariffs
Quotas
Embargoes
Standards
Subsidies
77. Why do some countries erect trade barriers?
78. Why do some countries advocate free trade?
79. What are the costs and benefits of trade barriers over time?
80. What are trading blocks?
81. Name three trading blocks.
82. Are there any good reasons to promote free trade? What might be a good reason to limit free
trade? ( good is a value judgment, so evaluate the arguments)
SSEIN 3
83. Define exchange rate.
84. Use the exchange rate table I gave you in class to practice finding the values of different currencies
in relation to the dollar or the Euro, etc.
85. When exchange rates change, why do some benefit and others lose?
Unit VI Personal Finance
SSEPF 1
86. What types of savings or investments plan would one want for the following future goals:
to buy a car
to go on a European vacation
to have money for your child’s college education
to have money for your college textbooks next year
for your own college expenses
for a new computer
for the down payment on a home
for your own retirement
SSEPF 2
87. What are the different types of financial institutions (we didn’t do this in your budget project so use
textbook pages 510-511). Recon did this in the Finance Project.
88. Why is interest charged not the same as interest earned?
89. What is the relationship between risk and return in investments? Give examples.
90. Define stocks and bonds and mutual funds. When might these be good choices for investment?
Evaluate these for savings and investment. (p 507-509, and also in part 4 of the budget project
directions)
SSEPF 3
91. How might changes in monetary and fiscal policy decisions impact personal spending and saving
choices? ( changes in interest rates or taxes for example)
92. Who benefits and who loses from inflation?
93. How does an increase in sales tax affect lower income people? Upper income?
SSEPF 4
94. What are some things that affect one’s credit worthiness? (p 512-13)
95. What is simple interest? What is compound interest?
96. When would you be glad to have a high interest rate? A low interest rate?
SSEPF 5
97. What is the purpose of buying insurance?
98. What are the different types of insurance?
99. What are the different costs and benefits associated with insurance?
( premiums, deductibles, co-pays, liabilities, etc)
SSEPF 6
100. How are workers earnings determined in the marketplace?
(think scarcity, supply and demand and the types of things that might increase the earnings
(price) of workers (labor).
There you have it! This is not a work sheet , so if you decide to do this for some OPTIONAL points,
do it on separate paper or notecards and NUMBER each item.
If you know all this, I can’t imagine not doing really well on the EOCT! The key is not to say “ I
studied”, but “ I really know this”. The only way to know if you know it is to test yourself! So get a
study buddy and quiz each other.
* Another great way to test yourself is to go to :
www. usatestprep.com and go to member login. The username is sprayberry, the password is
newton33. Then click on the tab at the top marked EOCT tests, and clik on Economics. Then do a
whole test. Keep taking it until you are satisfied with the grade. E-mail me the results.
Remember: Our EOCT is only 80 questions. You’ll do fine!