Economic Literacy

A large increase in the number of fast-food restaurants in a community is most likely to result in:

• Lower prices and higher quality.

• Lower prices and lower quality.

• Higher prices and higher quality.

A person who starts a business to produce a new product in the marketplace is known as:

• A manager.

• A bureaucrat.

• An entrepreneur.

An increase from 5% to 8% in the interest rates charged by banks would most likely encourage:

• Businesses to invest.

• People to purchase housing.

• People to save money.

For most people, the largest portion of their personal income comes from:

• Wages and salaries from their jobs.

• Interest from stocks and bonds they own.

• Rent paid to them from property they own.

If the real gross domestic product of the United States has increased, but the production of goods has remained the same, then the production of services has:

• Increased

• Decreased

• Remained the same

If the price of beef doubled and the price of poultry stayed the same, people would most likely buy:

• More poultry and less beef.

• Less poultry and more beef.

• The same amount of poultry and beef.

If the United States stopped importing automobiles from Country X, who would be most likely to benefit?

• Automobile manufacturers in Country X.

• Consumers in the United States.

• Automobile manufacturers in the United States.

If your city government sets a maximum amount landlords can charge in rent, what is the most likely result?

• There will be more apartments available than people want to rent.

• There will be fewer apartments available than people want to rent.

• The number of apartments available will be equal to the number of people that want to rent.

In the United States, who determines what goods and services should be produced?

• Producers and government

• Consumers and government.

• Producers, consumers, and government

Mexico grows fruits and vegetables and Argentina produces beef. If Mexico voluntarily trades fruits and vegetables in exchange for Argentinean beef, then:

• Both Mexico and Argentina benefit from the trade.

• Both Mexico and Argentina lose from the trade.

• Mexico benefits and Argentina loses from the trade.