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Business and Government — Test Answers

24 verified answers
1
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Which of these would be a good title for this diagram?

A
Fiscal Policy
B
The Federal Debt
C
Government Spending
D
The National Economy
2
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What does the author believe about factory owners?

A
They are greedy and selfish.
B
They struggle just as workers do.
C
They are stubborn but hardworking.
D
They earned their privileges.
3

Which of these are goals of an expansionary policy? Choose three correct answers.

A
decreased available credit
B
increased money supply
C
increased interest rates
D
decreased interest rates
E
increased available credit
F
increased inflation
4

What is the definition of collective bargaining?

A
ongoing salary negotiations between an employee and a factory owner
B
labor union and employer negotiations about wages and other issues
C
a written set of guidelines about legal and illegal workplace conditions
D
an agreement among a group of factory owners to raise worker wages
5

What led to Henry Ford’s success as an entrepreneur?

A
His personal wealth.
B
His commitment to improving labor laws.
C
His innovative production methods.
D
His desire to pay high wages.
6

The most common business organizations in the United States are

A
franchises.
B
partnerships.
C
corporations.
D
sole proprietorships.
7

An entrepreneur would most likely be a

A
low risk taker.
B
spontaneous person with an unclear vision.
C
person who has a brief work week.
D
person who works well alone.
8

Which best describes a central bank's primary goals?

A
reducing unemployment and maintaining cash flow
B
limiting inflation and reducing unemployment
C
controlling stagflation and reducing unemployment
D
managing credit and ensuring the money supply's liquidity
11

In which situation would government regulation most likely be necessary?

A
A power plant requires employees to take safety training classes.
B
A restaurant requires employees to work overtime on weekends.
C
A factory requires employees to work in unsafe conditions.
D
A computer company requires employees to work long hours.
12

Which best describes a central bank's primary role?

A
controlling inflation
B
creating monetary policy
C
printing money
D
increasing credit
13

Which best describes the difference between sole proprietorships and partnerships?

A
Sole proprietors split profits and share liabilities, while partners keep all profits and have unlimited liability.
B
Sole proprietors share responsibilities, while partners are responsible for only a portion of the business.
C
Sole proprietors pay taxes only on business profits, while partners do not have to pay taxes on profits.
D
Sole proprietors keep all profits and have unlimited liability, while partners split profits and share liabilities.
14

A purpose of government regulation in a mixed-market economy is to protect

A
property rights.
B
corporate rights.
C
investor rights.
D
states' rights.
15

What gives the US government the power to collect taxes?

A
an executive order
B
the Constitution
C
laws passed by Congress
D
common law
16

How are progressive taxes and regressive taxes similar?

A
Both are types of indirect taxes.
B
Both are determined based on income.
C
Both charge high-income individuals more.
D
Both are considered flat taxes.
17

Regulatory policy requires a balance between protecting safety and

A
protecting states’ rights.
B
improving environmental conditions.
C
improving corporate profits.
D
protecting constitutional rights.
18

When a government creates a budget, it is seeking a way to

A
spend as much revenue as possible.
B
return as much money to taxpayers as possible.
C
allocate money to programs and projects.
D
cut spending to a bare minimum.
20

An entrepreneur is someone who

A
works for multiple developing businesses.
B
starts and runs a business.
C
is an employee of a business.
D
invents products for other businesses.

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