Pre-Test Answers

MULTIPLE CHOICE

1. ANS: A PTS: 1 DIF: Medium REF: 8
OBJ: 1.1.2.1 TOP: guns or butter | trade-offs

2. ANS: C PTS: 1 DIF: Easy REF: 9
OBJ: 1.1.2.2 TOP: opportunity cost

3. ANS: D PTS: 1 DIF: Medium REF: 26-27
OBJ: 1.2.1.1 TOP: traditional economies

4. ANS: D PTS: 1 DIF: Medium REF: 28
OBJ: 1.2.2.1 TOP: markets

5. ANS: B PTS: 1 DIF: Medium REF: 32
OBJ: 1.2.2.4 TOP: free market

6. ANS: C PTS: 1 DIF: Medium REF: 36
OBJ: 1.2.3.2 TOP: collectives | Soviet Union

7. ANS: B PTS: 1 DIF: Medium REF: 43
OBJ: 1.2.4.3 TOP: mixed economy

8. ANS: A PTS: 1 DIF: Hard REF: 67
OBJ: 1.3.4.1 TOP: poverty

9. ANS: A PTS: 1 DIF: Hard REF: 52
OBJ: 1.3.1.1 TOP: constitutional protections

10. ANS: C PTS: 1 DIF: Medium REF: 79
OBJ: 2.4.1.1 TOP: law of demand

11. ANS: A PTS: 1 DIF: Medium REF: 87
OBJ: 2.4.2.2 TOP: law of demand

12. ANS: B PTS: 1 DIF: Medium REF: 86-87
OBJ: 2.4.2.2 TOP: law of demand

13. ANS: B PTS: 1 DIF: Medium REF: 87
OBJ: 2.4.2.2 TOP: demand curve | shift

14. ANS: D PTS: 1 DIF: Easy REF: 91
OBJ: 2.4.3.1 TOP: elasticity

15. ANS: C PTS: 1 DIF: Medium REF: 92
OBJ: 2.4.3.1 TOP: elasticity | demand curve

16. ANS: C PTS: 1 DIF: Medium REF: 112-113
OBJ: 2.5.2.3 TOP: quantity supplied

17. ANS: D PTS: 1 DIF: Medium REF: 104
OBJ: 2.5.1.3 TOP: elasticity of supply

18. ANS: A PTS: 1 DIF: Hard REF: 104
OBJ: 2.5.1.3 TOP: inelasticity

19. ANS: C PTS: 1 DIF: Easy REF: 126
OBJ: 2.6.1.2 TOP: price ceiling

20. ANS: D PTS: 1 DIF: Medium REF: 166-167
OBJ: 2.7.3.1 TOP: monopolistic competition

21. ANS: C PTS: 1 DIF: Hard REF: 169
OBJ: 2.7.3.4 TOP: oligopoly

22. ANS: A PTS: 1 DIF: Medium REF: 199
OBJ: 3.8.3.4 TOP: vertical merger

23. ANS: D PTS: 1 DIF: Medium REF: 192
OBJ: 3.8.2.2 TOP: sole proprietorship | partnership

24. ANS: A PTS: 1 DIF: Medium REF: 187-188
OBJ: 3.8.1.3 TOP: sole proprietorship

25. ANS: D PTS: 1 DIF: Medium REF: 216
OBJ: 3.9.1.4 TOP: labor force

26. ANS: B PTS: 1 DIF: Medium REF: 255
OBJ: 4.10.2.3 TOP: federal deposit insurance corporation

27. ANS: D PTS: 1 DIF: Medium REF: 263
OBJ: 4.10.3.3 TOP: types of financial institutions

28. ANS: B PTS: 1 DIF: Medium REF: 260
OBJ: 4.10.3.2 TOP: functions of financial institutions

29. ANS: A PTS: 1 DIF: Medium REF: 281-282
OBJ: 4.11.2.2 TOP: types of bonds

30. ANS: C PTS: 1 DIF: Hard REF: 279-280
OBJ: 4.11.2.1 TOP: characteristics of bonds

31. ANS: D PTS: 1 DIF: Medium REF: 286
OBJ: 4.11.3.1 TOP: buying stock

32. ANS: B PTS: 1 DIF: Medium REF: 302-303
OBJ: 5.12.1.2 TOP: Gross Domestic Product

33. ANS: C PTS: 1 DIF: Medium REF: 314-315
OBJ: 5.12.2.4 TOP: business cycles

34. ANS: D PTS: 1 DIF: Easy REF: 311
OBJ: 5.12.2.1 TOP: stagflation

35. ANS: C PTS: 1 DIF: Hard REF: 334-335
OBJ: 5.13.1.2 TOP: unemployment rate

36. ANS: B PTS: 1 DIF: Medium REF: 331-334
OBJ: 5.13.1.1 TOP: types of unemployment

37. ANS: D PTS: 1 DIF: Hard REF: 340
OBJ: 5.13.2.2 TOP: inflation rate

38. ANS: B PTS: 1 DIF: Medium REF: 368
OBJ: 6.14.2.4 TOP: excise tax

39. ANS: B PTS: 1 DIF: Medium REF: 407
OBJ: 6.15.3.4 TOP: balanced budget

40. ANS: A PTS: 1 DIF: Easy REF: 396
OBJ: 6.15.3.3 TOP: crowding-out effect

41. ANS: A PTS: 1 DIF: Medium REF: 428
OBJ: 6.16.3.2 TOP: discount rate

42. ANS: B PTS: 1 DIF: Medium REF: 420
OBJ: 6.16.2.1 TOP: federal reserve system

43. ANS: D PTS: 1 DIF: Easy REF: 418
OBJ: 6.16.1.3 TOP: federal open market committee

44. ANS: D PTS: 1 DIF: Medium REF: 426
OBJ: 6.16.3.1 TOP: money multiplier | required reserve ratio

45. ANS: C PTS: 1 DIF: Medium REF: 463
OBJ: 7.17.3.3 TOP: trade deficit

46. ANS: B PTS: 1 DIF: Medium REF: 442-445
OBJ: 7.17.1.1 TOP: law of comparative advantage

47. ANS: C PTS: 1 DIF: Medium REF: 452
OBJ: 7.17.2.3 TOP: protectionism

48. ANS: B PTS: 1 DIF: Medium REF: 456
OBJ: 7.17.2.5 TOP: trade barriers

49. ANS: A PTS: 1 DIF: Medium REF: 479
OBJ: 7.18.2.1 TOP: less developed country | developed nation

50. ANS: C PTS: 1 DIF: Hard REF: 488
OBJ: 7.18.3.3 TOP: less developed country | debt | International Monetary Fund (IMF)