1. Statement I: Interest rates would fall if the demand for loanable funds rises. Statement II: Interest rates would rise if the supply of loanable funds decreased.A) Statement I is true and statement II is false.B) Statement II is true and statement I is false.C) Both statements are true.D) Both statements are false.2.The increase in two wage earning families in the U.S. has resulted in a substantial increase in the percentage of disposable income spent onA) FoodB) Appliances and computersC) Services and transportationD) Luxury items3.Housing cost has increased about _______ percent since 1970 due to the active market for real estate in desirable neighborhoods near good schools.(THIS QUESTION IS VERY SPECFIC TO THE KIND OF DATA YOU STUDIED. MY BEST GUESS IS MARKED AS FOLLOWS)A) About 30B) About 50C) About 70D) About 1004.As a nation’s income falls, induced consumption _________________.A) risesB) fallsC) remains the same5.Conspicuous consumptionA) was a phrase coined by Karl Marx.B) was a phrase coined by Thorstein Veblen.C) was a phrase coined by Milton Friedman.D) was a phrase coined by Adam Smith.6.Which of the following would most likely cause Consumption to decrease?A) The stock market rebounds.B) Credit cards become more available.C) Americans expect a severe recession.D) A rise in the level of income.7.By making a partnership a limited partnership, the partners have the following advantage of a corporation form of businessA) perpetual lifeB) lower total taxesC) can sell stock to public to obtain additional financingD) limited liability8.Suppose you own $50,000 worth of personal property, $1,000 in government bonds, $500 in a savings account, and $20,000 of Walmart common stock. If Walmart goes bankrupt, the most you could lose isA) $20,000.B) $21,000.C) $21,500.D) $70,000.9.All of the following are disadvantages of the proprietorship form of business exceptA) the entire burden of running the company falls on one person’s shoulder’s.B) there are fewer legal complications than any other form of business.C) the owner may be sued for everything she has if the business is sued.D) it is a lot harder for one person, rather than two or more people, to raise capital.10.Critics of the tax cut of 2001 made all of the following arguments EXCEPTA) It would push up the federal budget deficit.B) Most of the benefits would go to the rich.C) The last time massive tax cuts were enacted in the 1980s, budget deficits increased dramatically.D) The tax cut will discourage people from working11.Which would be the most accurate description of the top marginal tax rate of the federal income tax?A) It is much lower than it was in 1980.B) It is much higher than it was in 1980.C) It is higher than it has ever been.D) It is lower than it has ever been12.Excise taxesA) are aimed at a specific good or service.B) are aimed at a wide range of products.C) are direct taxes.D) are generally progressive in nature.13. Statement 1: In 2002 and 2003, state after state slashed services and raised taxes. Statement 2: Through the 1970s, the 1980s, and the 1990s, state governments ran substantial budget deficits.A) Statement I is true and statement II is false.B) Statement II is true and statement I is false.C) Both statements are true.D) Both statements are false.14. Statement 1: The first Presidents George Bush and President Bill Clinton will go down in history as two of our greatest tax cutters. Statement 2: Presidents Ronald Reagan and The second President Bush will go down in history as two of our greatest tax cutters.A) Statement 1 is true and Statement 2 is false.B) Statement 2 is true and Statement 1 is false.C) Both statements are true.D) Both statements are false.15 .The most important economic concept to consider when deciding whether to build your own deck or hire it done isA) law of supplyB) specializationC) opportunity costD) law of increasing cost16.The most important economic concept to consider when deciding whether to produce a product domestically or import the product isA) law of supplyB) law of demandC) opportunity costD) law of increasing cost17.In 2004, ___________ exceeded the United States in value of exports becoming the world’s largest exporter.A) ChinaB) JapanC) CanadaD) Germany18.After World World II, the United States produced about ______ percent of the world’s oil, much of which we exported.A) 40B) 50C) 60D) 7019.All of the following are an example of “off-shoring” EXCEPTA) Accounting work that is sent over the Internet by the Miller Brewing Company in Milwaukee to Ireland.B) An X-ray read by an Indian physician sent over the Internet from Durango, Colorado.C) Briefs for law firms typed by people in China.D) Wal-Mart hires a local janitorial firm to clean their stores at night.
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