Chapter 19
Economics and the Consumer
Practice Test
1.
What does economics involve?
a.
how people produce goods
b.
how people distribute goods and services
c.
how people use services
d.
all of the above
2.
What is the process of making goods and services available to people who need them?
a.
production
b.
distribution
c.
economics
d.
free enterprise
3.
What type of economic system does the United States economic have?
a.
a free enterprise system
b.
a controlled system
c.
a socialistic system
d.
a controlled capitalist system
4.
Which of the following is an example of a consumer?
a.
a mother who buys a CD player for her daughter
b.
a gift store selling cards
c.
a young man buying a T-shirt for himself
d.
all of the above
5.
What is an example of a marketplace?
a.
a grocery store
b.
an e-commerce Web site
c.
the New York Stock Exchange
d.
all of the above
6.
What is the term for the amount of goods and services that consumers want to buy?
a.
supply
b.
demand
c.
marketplace
d.
market force
7.
In general, what does competition produce in a free enterprise economy?
a.
lower prices
b.
reduced supply
c.
reduced demand
d.
lower production costs
8.
What is the term for a period of economic slow-down, in which unemployment is rising and consumer spending is decreasing?
a.
prosperity
b.
recession
c.
depression
d.
recovery
9.
What is the term for the total dollar value of all goods and services produced in the United States during a year?
a.
Gross Domestic Product
b.
Gross National Product
c.
Consumer Price Index
d.
Standard of Living Index
10.
What is an indicator of the health of an economy?
a.
unemployment rate
b.
GDP
c.
CPI
d.
all of the above
11.
Which of the following is not good advice for smart shopping?
a.
take advantage of discount stores
b.
consider buying used goods
c.
buy expensive items because they will be higher in quality
d.
compare store prices with prices online
12.
What is it called when a car dealership advertises a new car for sale for $8,000 that they don't have in stock?
a.
bait and switch
b.
auto repair fraud
c.
prize fraud
d.
securities fraud
13.
What is the government agency that enforces rules about labeling and advertising?
a.
Consumer Product Safety Commission
b.
Federal Trade Commission
c.
Food and Drug Administration
d.
Securities and Exchange Commission
14.
Which of the following is an example of a consumer group?
a.
the Consumer Product Safety Commission
b.
the Food and Drug Administration
c.
the Warranty Guild
d.
Consumers Union
15.
Which government agency protects consumers by enforcing laws governing the quality of medical devices?
a.
Consumer Product Safety Commission
b.
Federal Trade Commission
c.
Food and Drug Administration
d.
Securities and Exchange Commission
