PFL-Economics Mid-Term Review

How does this quote from Adam Smith symbolize the economic principles of competition and incentives?

• Sellers are forced to provide goods and services to other individuals in the economy through military force.

• Sellers provide their goods for sale, not for the benefit of society, but to make money to provide for themselves.

• Sellers are given the products to sell by the government and all profits are sent back to the government for public use.

• Sellers are responsible for collecting taxes on goods and services and transferring the funds directly to consumers for their use.

What is the significance of the information presented in the infographic?

• Mixed economies are relatively rare.

• Centrally planned economies dominate modern systems.

• Most economies are mixed economies.

• Economies that are mostly free markets do not exist.

Which statement best explains the impact of fiscal policies on the unemployment rate?

• When the government reduces taxes, it prompts consumers to increase spending, leading businesses to boost production, ultimately resulting in a decrease in unemployment.

• When the government reduces taxes, it prompts consumers to decrease spending, leading businesses to reduce production, ultimately resulting in a decrease in unemployment.

• When the government increases spending, it prompts businesses to reduce production, ultimately resulting in a increase in unemployment.

• When the government reduces spending, it contracts companies to manufacture goods that the government needs, leading to a rise in unemployment.

Based on the quote, which of the following does our Constitution authorize the federal government to do?

• Sell government bonds to cover the annual budget.

• Sell government bonds to cover federal spending.

• Collect taxes to pay for corporate development.

• Collect taxes to pay for public goods.

Which type of financial aid involves programs offering career-related work experience?

• Grants

• Scholarships

• Work-Study

• Student Loans

What type of financial aid is typically awarded based on a student's achievements and/or accomplishments?

• Grants

• Work-Study

• Scholarships

• Student Loans

Which financial aid option involves borrowed funds that must be repaid?

• Grants

• Work-Study

• Scholarships

• Student Loans

Which statement is TRUE about the value of a college degree? Select TWO correct answers.

• A high school graduate can expect to earn about the same as a college graduate.

• A college degree generally leads to higher lifetime earnings compared to a high school diploma.

• A college graduate can expect to earn, on average, more than a high school graduate over a career.

• A college graduate typically earns less than someone with a high school diploma for the first 10 years.

• Every college graduate can expect to have a starting salary over $60,000 right after college.

Grants and _______ are better than student loans for financing college because they do not require repayment.

• scholarships

• loans

• debts

• interests

Based on this excerpt, how do economic concepts like choice and opportunity cost relate to everyday decision-making?

• Choice and opportunity cost involve deciding between different activities and understanding that choosing one option means forgoing others.

• Choice and opportunity cost primarily affect financial decisions and are less relevant to balancing academic and personal responsibilities.

• Choice and opportunity cost are only relevant in a professional context, not in managing a college workload or extracurricular activities.

• Choice and opportunity cost only impact the decision-making of individuals with a flexible work-life balance.