Deck 2: The Economy Myth and Reality

Question 1

GDP is a measure of the total output of an economy.

Answer 1

True

Question 2

Real GDP per capita in the U.S.grows over time.

Answer 2

True

Question 3

Real GDP is the dollar value of all goods and services produced in an economy.

Answer 3

False

Question 4

Prosperity in the United States is evenly distributed across the fifty states.

Question 5

The U.S.economy rarely grows.

Question 6

Outputs include goods but not services.

Question 7

The U.S.economy is unique for both its size and prosperity.

Question 8

The United States is one of the most marketized economies in the world.

Question 9

The U.S.economy is relatively open in terms of economic activity related to international trade.

Question 10

An open economy is one in which exports and imports constitute a large share of GDP.

Question 11

The United States is one of the least marketized economies in the world.

Question 12

The factors of production include all goods and services produced in an economy.

Question 13

In the United States, all property is privately owned.

Question 14

The U.S.economy is relatively closed in terms of economic activity related to exports and imports.

Question 15

Population density varies little between the fifty states.

Question 16

An open economy produces most of the goods and services that it needs, with few imports and exports.

Question 17

Gross domestic product is the money value of all final goods and services produced in an economy in a year.

Question 18

Government production accounts for about half of all GDP in the United States.

Question 19

The United States is the largest national economy in the world.

Question 20

Gross domestic product is the money value of manufacturing production in a year.

Question 21

Workers earn less than half of the income generated by the production process.

Question 22

The majority of American workers are employed in the service sector of the economy.

Question 23

The federal government employs more civilians than state and local governments.

Question 24

In 2013, per capita real GDP was roughly half its value in 1960.

Question 25

The majority of American workers are employed in the manufacturing sector.

Question 26

Approximately half of all U.S.workers are employed by various levels of government.

Question 27

Over the last several years and until recently, the United States has had lower unemployment rates than most European countries.

Question 28

A recession is a period of time in which the total output of the economy rises.

Question 29

A recession is a period of time in which real GDP falls.

Question 30

The total market value of capital assets in the United States is about $30 trillion dollars.

Question 31

Roughly 144 million people in the United States hold jobs.

Question 32

Unemployment in the United States varies considerably over time.

Question 33

Consumer spending accounts for about 70 percent of GDP.

Question 34

A recession is a period of time in which the total output of the economy falls.

Question 35

A minority of American women work outside of the home.

Question 36

Teenage employment in the United States has risen in the last two decades.

Question 37

The U.S.economy has grown steadily over the years.

Question 38

Workers earn more than half of the income generated by the production process.

Question 39

Recessions are periods of declining economic activity.

Question 40

Profits account for about 30 cents out of each dollar spent on goods in the United States.

Question 41

Government spending plays no role in meeting our social and public needs.

Question 42

The federal government receives most of its revenue from personal income taxes and payroll taxes.

Question 43

National defense made up the largest portion of federal expenditures in 2009.

Question 44

American households spend more of their incomes on goods than on services.

Question 45

Transfer payments are money received as grants from government.

Question 46

In a mixed economy, there is some public influence over the workings of free markets.

Question 47

Multinational businesses produce and sell goods around the world.

Question 48

There are about 5 million business firms in the Unites States.

Question 49

Government in the United States spends more as a percentage of GDP than in most other industrialized nations.

Question 50

Antitrust laws are designed to promote competition.

Question 51

The nationality of a company and a product is easily determined.

Question 52

The corporate income tax is the single largest source of revenue for the federal government.

Question 53

A tax is progressive if it raises a greater fraction of total tax revenue every year.

Question 54

The personal income tax is the single largest source of revenue for the federal government.

Question 55

One important role for government as referee is in defining and enforcing property rights.

Question 56

A tax must be progressive if an individual with a higher income pays more dollars in taxes than an individual with a lower income.

Question 57

Government is unnecessary in a free enterprise economy such as the United States.

Question 58

The government's budget accounts for about 80 percent of GDP in the United States.

Question 59

A tax is progressive if the ratio of taxes to income rises as income rises.

Question 60

Education accounts for the largest share of state and local government spending.

Question 61

If California were a separate economy, it would be the ____ largest economy on earth.

A)second
B)third
C)fifth
D)eighth

Question 62

Inputs, or factors of production, include

A)labor.
B)machinery.
C)natural resources.
D)all of the above.

Question 63

Which of the following is the best definition of openness?

A)The average of imports expressed as a share of GDP.
B)The average of goods traded in markets expressed as a share of GDP.
C)The average of imports and exports expressed as a share of GDP.
D)The average trade balance expressed as a share of GDP.
E)The average of exports expressed as a share of GDP.

Question 64

Capitalism and free enterprise are common, and the United States

A)has just begun to move in that direction after years of central planning.
B)has gone further in that direction than almost any other country.
C)is becoming more "free," but is not as capitalistic as many others.
D)is considering a major change to "free up" its economy as many others have.
E)is leading the move toward greater central planning and control.

Question 65

A mixed economy is one that combines public and private ownership of property.

Question 66

How does the U.S.economy rank in size?

A)first in economic output
B)second in economic output
C)third in economic output
D)fourth in economic output
E)fifth in economic output

Question 67

The United States has the largest economy in the world because

A)it has the most land to work with.
B)it has a large population.
C)American workers are very productive.
D)both b and c are correct.

Question 68

Imports from China represent ____ of total U.S.imports.

A)less than 20%
B)approximately 40%
C)approximately 60%
D)more than 80%

Question 69

As of 2013, annual imports to the U.S.were approximately ____ and annual exports from the U.S.were approximately ____.

A)$0.6 trillion; $1.5 trillion
B)$2.2 trillion; $0.7 trillion
C)$2.7 trillion; $2.3 trillion
D)$1.5 trillion; $2.0 trillion
E)$2.0 trillion; $2.0 trillion

Question 70

How does the United States compare to other advanced, industrialized economies on the issue of openness?

A)It is completely closed.
B)It is one of the less open of them.
C)It is about average in openness.
D)It is one of the more open of them.
E)It is the most open of them.

Question 71

The United States is an example of a mixed economy.

Question 72

A mixed economy blends private and public elements.​

Question 73

Gross domestic product is

A)the largest industry in an economy.
B)the money value of all final goods and services produced in a year.
C)the volume of goods and services which are subject to international trade.
D)goods and services produced by private companies.
E)non-market production of goods and services.

Question 74

Government ownership of property and resources in the United States is

A)about as common as it is in European countries.
B)widespread; the United States is a leader in the amount of government ownership of resources.
C)relatively rare; the United States is mostly privatized.
D)rare, but has been increasing rapidly as the United States catches up to other countries.

Question 75

The U.S.has the biggest national economy in the world solely because of the U.S.population.

Question 76

On a world scale, how populous is the U.S.economy?

A)first
B)second
C)third
D)fourth
E)fifth

Question 77

The United States produces ____ of what it consumes, and consumes ____ of what it produces.

A)little, little
B)little, most
C)most, little
D)most, most

Question 78

In 2013, about what percentage of goods and services sold in the United States was imported?

A)5%
B)16%
C)22%
D)88%

Question 79

The working population of the United States is approximately

A)144 million
B)290 million
C)300 million
D)1.3 billion

Question 80

The United States economy is

A)the third largest in the world.
B)larger than all other national economies combined.
C)second largest in the world, behind Japan.
D)largest in the world.