True / False
1. The United States is the largest national economy in the world.
a.
True
b.
False
2. The U.S. economy is unique for both its size and prosperity.
a.
True
b.
False
3. The factors of production include all goods and services produced in an economy.
a.
True
b.
False
4. Outputs include goods but not services.
a.
True
b.
False
5. Population density varies little between the fifty states.
a.
True
b.
False
6. Prosperity in the United States is evenly distributed across the fifty states.
a.
True
b.
False
7. In the United States, all property is privately owned.
a.
True
b.
False
8. Gross domestic product is the money value of all final goods and services produced in an economy in a year.
a.
True
b.
False
9. Gross domestic product is the money value of manufacturing production in a year.
a.
True
b.
False
10. GDP is a measure of the total output of an economy.
a.
True
b.
False
11. Real GDP is the dollar value of all goods and services produced in an economy.
a.
True
b.
False
12. Government production accounts for about half of all GDP in the United States.
a.
True
b.
False
13. The United States is one of the most marketized economies in the world.
a.
True
b.
False
14. The United States is one of the least marketized economies in the world.
a.
True
b.
False
15. The U.S. economy is relatively open in terms of economic activity related to international trade.
a.
True
b.
False
16. The U.S. economy is relatively closed in terms of economic activity related to exports and imports.
a.
True
b.
False
17. An open economy produces most of the goods and services that it needs, with few imports and exports.
a.
True
b.
False
18. An open economy is one in which exports and imports constitute a large share of GDP.
a.
True
b.
False
19. The U.S. economy rarely grows.
a.
True
b.
False
20. Real GDP per capita in the U.S. grows over time.
a.
True
b.
False
21. In 2013, per capita real GDP was roughly half its value in 1960.
a.
True
b.
False
22. A recession is a period of time in which the total output of the economy falls.
a.
True
b.
False
23. A recession is a period of time in which real GDP falls.
a.
True
b.
False
24. The U.S. economy has grown steadily over the years.
a.
True
b.
False
25. A recession is a period of time in which the total output of the economy rises.
a.
True
b.
False
26. Unemployment in the United States varies considerably over time.
a.
True
b.
False
27. Recessions are periods of declining economic activity.
a.
True
b.
False
28. Over the last several years and until recently, the United States has had lower unemployment rates than most European
countries.
a.
True
b.
False
29. Roughly 144 million people in the United States hold jobs.
a.
True
b.
False
30. Teenage employment in the United States has risen in the last two decades.
a.
True
b.
False
31. A minority of American women work outside of the home.
a.
True
b.
False
32. Approximately half of all U.S. workers are employed by various levels of government.
a.
True
b.
False
33. The federal government employs more civilians than state and local governments.
a.
True
b.
False
34. The majority of American workers are employed in the manufacturing sector.
a.
True
b.
False
35. The majority of American workers are employed in the service sector of the economy.
a.
True
b.
False
36. Workers earn less than half of the income generated by the production process.
a.
True
b.
False
37. Workers earn more than half of the income generated by the production process.
a.
True
b.
False
38. The total market value of capital assets in the United States is about $30 trillion dollars.
a.
True
b.
False
39. Profits account for about 30 cents out of each dollar spent on goods in the United States.
a.
True
b.
False
40. Consumer spending accounts for about 70 percent of GDP.
a.
True
b.
False
41. American households spend more of their incomes on goods than on services.
a.
True
b.
False
42. There are about 5 million business firms in the Unites States.
a.
True
b.
False
43. The nationality of a company and a product is easily determined.
a.
True
b.
False
44. Multinational businesses produce and sell goods around the world.
a.
True
b.
False
45. Government is unnecessary in a free enterprise economy such as the United States.
a.
True
b.
False
46. One important role for government as referee is in defining and enforcing property rights.
a.
True
b.
False
47. Antitrust laws are designed to promote competition.
a.
True
b.
False
48. Government spending plays no role in meeting our social and public needs.
a.
True
b.
False
49. National defense made up the largest portion of federal expenditures in 2009.
a.
True
b.
False
50. Government in the United States spends more as a percentage of GDP than in most other industrialized nations.
a.
True
b.
False
51. The personal income tax is the single largest source of revenue for the federal government.
a.
True
b.
False
52. The corporate income tax is the single largest source of revenue for the federal government.
a.
True
b.
False
53. The federal government receives most of its revenue from personal income taxes and payroll taxes.
a.
True
b.
False
54. Transfer payments are money received as grants from government.
a.
True
b.
False
55. A tax is progressive if the ratio of taxes to income rises as income rises.
a.
True
b.
False
56. A tax is progressive if it raises a greater fraction of total tax revenue every year.
a.
True
b.
False
57. A tax must be progressive if an individual with a higher income pays more dollars in taxes than an individual with a
lower income.
a.
True
b.
False
58. Education accounts for the largest share of state and local government spending.
a.
True
b.
False
59. The government’s budget accounts for about 80 percent of GDP in the United States.
a.
True
b.
False
60. In a mixed economy, there is some public influence over the workings of free markets.
a.
True
b.
False
61. A mixed economy is one that combines public and private ownership of property.
a.
True
b.
False
62. The United States is an example of a mixed economy.
a.
True
b.
False
63. The U.S. has the biggest national economy in the world solely because of the U.S. population.
a.
True
b.
False
64. A mixed economy blends private and public elements.
a.
True
b.
False
Multiple Choice
65. 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.
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
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.
68. Inputs, or factors of production, include
a.
labor.
b.
machinery.
c.
natural resources.
d.
all of the above.
69. On a world scale, how populous is the U.S. economy?
a.
first
b.
second
c.
third
d.
fourth
e.
fifth
70. The working population of the United States is approximately
a.
144 million
b.
290 million
c.
300 million
d.
1.3 billion