QUESTION A few parties in Moratvia want to see the country return to the command economy that was once dominant in the country, thinking that this is the best way to ensure that the economy grows. Which of the following, if true, weakens this argument for returning to a command economy? A) Moratvian culture favors […]
Date: September 3rd, 2020
QUESTION What are the criteria for economic stability? What will be an ideal response? ANSWER Answer: When there are enough desirable goods and services to satisfy consumer demand, and consumers have the purchasing power to buy the products they want, business is in a period of economic stability. Explanation: Supply satisfying demand is not […]
Date: September 3rd, 2020
QUESTION How is an economic “bubble” characterized? What will be an ideal response? ANSWER Answer: An economic bubble is a period in which stocks and other securities rise far above their actual value. Explanation: The United States has already experienced technology and housing bubbles in the 21st century.
Date: September 3rd, 2020
QUESTION Explain how a recession is defined. What will be an ideal response? ANSWER Answer: A recession is defined as two or more consecutive periods of decline in GDP. Explanation: A recession is a slowdown in the rate of growth. GDP is measured per annual quarter, so a slowdown in two or more consecutive […]
Date: September 3rd, 2020
QUESTION Which of the following, if true, strengthens the argument in favor of a price increase? A) Substitutes for widgets are available in the market. B) The price of materials consumed along with widgets has gone up. C) A change in the environment is likely to stimulate overall demand for widgets. D) Competitors have announced […]
Date: September 3rd, 2020
QUESTION Based on the information above, Tata most likely believes that as a result of recent changes in India’s economy, a growing number of Indian consumers ________. A) became even more cost-conscious than ever before B) would be willing and able to spend 100,000 rupees on a car C) would choose a vehicle with high […]
Date: September 3rd, 2020
QUESTION The 2009 American Recovery and Reinvestment Act was designed to stimulate economic growth in the Great Recession. The act was a combination of tax cuts as well as government spending funded through borrowing. What is this is an example of? A) regulatory policy B) fiscal policy C) monetary policy D) central planning E) the […]
Date: September 3rd, 2020
QUESTION Which of the following, if true, weakens the argument for a price increase? A) The input costs of raw materials are expected to increase further in the coming months. B) Customers are loyal to the brand mainly because they believe in the quality of ingredients used. C) Anon’s competitors have announced an increase in […]
Date: September 3rd, 2020
QUESTION During a period of the Great Recession, 10 percent of Americans were unemployed and household wealth dropped significantly. Consequently, people stopped buying goods and began saving for an uncertain future. Policymakers were fearful this would lead to what process? A) hyperinflation B) securitization C) disinflation D) deflation E) inflation ANSWER Answer: D Explanation: […]
Date: September 3rd, 2020
QUESTION What happens in a foreclosure? What will be an ideal response? ANSWER Answer: A bank repossessing and selling a home on which the borrower cannot meet loan payment obligations is called a foreclosure. Explanation: Foreclosure rates skyrocketed during the collapse of the bubble in the U.S. housing industry.
Date: September 3rd, 2020
