1. Economics 2301-macro Are you smarter than a 5 th grader….. OK Are you smarter than the man on the street?????

2. When you think of economics, what do you think of? ECONOMICS DEFINITION

3. Which is always present in an economic system? (a) central planning (b) strikes (c) scarce resources (d) market decision-making

4. Which of the following taxes is mostly based on the ability to pay? A) property tax B)sales tax C) social security tax D) income tax

5. Caveat emptor means: A) the public’s right to obtain land B) let the buyer beware C) citizen’s right to own property D) noninterference by government E) special concessions to business

6. Who controls the money in circulation? A) Treasury B) Federal Deposit of Insurance Corporation C) Federal Reserve D) Banks

7. An underdeveloped country is basically A) industrial in nature B) receiving a favorable balance of trade C) automated D) agrarian in nature

8. The total value of goods and services produced in a given year is called: A) national income B) national wealth C) consumer debt D) gross domestic product

9. Federal government expenditures in the market are the greatest in which of the following areas? A) defense B) debt C) welfare d) foreign aid

10. Supply and demand in the market determine A) utility B) cost C) production D) price

11. Name the three basic economic systems in the world. A)_____________ B)_____________ C)_____________

12. The opportunity cost of a new public high school is the: A) money cost of hiring teachers for the new school B) cost of constructing the new school at a later date C) change in the annual tax rate to pay for the new school D)other goods and services that must be given up to build the new school

13. Assuming little or no government interference in the market, which of the following is the lifeblood (internal engine) of the market? A) competition B) price C) stock market D) regulation

14. Which government agency regulates antitrust formations? A) Supreme Court B) Congress C) Federal Trade Commission D) State Courts

15. ___Social Security___ Federal Income Compensation Act.. (also called payroll taxes) FICA which is reported in your paycheck stands for what deduction?

16. What is monetary policy? _________________________

17. What is fiscal policy? ___________________________

18. Name the four factors of production A________________ B________________ C_________________ D________________

19. One example of a capital good would be: A) bank deposits B) roofing machine C) coal D) ink

20. Ceteris paribus means: A) who cares B) the money is inflated C) all other things being equal D) the money should be equally distributed

21. Who wrote the Wealth of Nations? _________________________

22. What type of business formation is the most common in the U.S.? _________________________

23. Which security pays interest? A) stock B) bond

24. What is the motivating force of a free enterprise economy? ____________________________

25. Our Economy Today? Unemployment rate? Inflation rate? Confidence level? Balance of trade? Cost of crude oil? Housing market?

26. “ There can be no real freedom in the presence of economic insecurity.” Chester Bowles