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?
• 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?
• 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?
• A. Social Security• B. Medicaid• C. Medicare• D. Education
Question 4
Which is an example of discretionary spending?
• A. Social Security• B. Medicaid• C. Medicare• D. Education
Question 5
• What do taxes collected under the Federal Insurance Contribution Act (FICA) fund?
• 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?
• 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
• 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
• 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
• A. real GDP.• B. nominal GDP.• C. price level.• D. net national product.
Question 7
GDP expressed in constant, or unchanging, prices is called
• A. real GDP.• B. nominal GDP.• C. price level.• D. net national product.
Question 8
The lowest point in an economic contraction is called
• A. a peak.• B. a recession.• C. a trough.• D. a depression.
Question 8
The lowest point in an economic contraction is called
• 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?
• A. contraction• B. trough• C. expansion• D. growth
Question 10
In a typical business cycle, what stage immediately follows a peak?
• A. contraction• B. trough• C. expansion• D. growth
Question 11
An example of a nondurable good is
• 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
• 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