QUIZ 15

QUESTION 1

"The unemployment rate, as estimated by the government, could underestimate the true amount of unemployment if:"

A. many people start working a part time on addition to their full time job.

B. large numbers of people work in the underground economy.

C. employees increase the number of hours they work overtime.

D. people become discouraged and stop looking for work.

QUESTION 2

Which of the following do most economists believe?

A. War is beneficial to the long term growth of most countries.

B. Trade is bad for the long term growth of most countries.

C. Economics is primarily about getting more money.

D. All of the above

E. None of the above

QUESTION 3

Suppose the supply of pens increases. Pens are a substitute for pencils. You would expect

A. the equilibrium price of pens rises but equilibrium price for pencils falls

B. the equilibrium price of pencils rises but equilibrium price for pens falls C. the equilibrium price falls for both pens and pencils

D. the equilibrium price rises for both pens and pencils

QUESTION 4

If a country bans imports in order to encourage the growth of domestic industries

A. Exports increase.

B. People pay more for goods and services, because they are produced by less efficient domestic manufacturers, who are protected from foreign competition.

C. People pay less for goods and services, because they are produced domestically.

D. The quality of goods and services improves, because they are produced domestically rather than imported from abroad.

QUESTION 5

"When a loan is repaid, the value of the money used in the repayment may have fallen since the loan was made. Part of the reason for interest payments is so the lender can recoup some of that lost value due to expected________

A. risk premium

B. compound interest

C. inflation

D. opportunity costs