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Economic Policy Answers

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1
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What is a primary economic goal of governments?

A
reducing income inequality
B
maximizing individual freedoms
C
advancing technological innovation
D
protecting natural resources
2
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In a free enterprise system, governments address public problems through policy to ensure that

A
citizens' needs are met and protected.
B
economic operations of businesses are controlled.
C
workers earn more than workers in other countries.
D
the nation's level of productivity remains steady.
3

A government's monetary policy is its plan to control

A
taxation and spending.
B
prices.
C
workers' wages.
D
the money supply.
4

A line graph titled Number of Employed workers in nonfarm jobs, 2008 to 2013 shows years on the x axis from 2008 to 2009 and millions of employed workers on the y axis, from 105 to 117. Line starts at 116 on February 1, 2008, to 112 on November 1, 2008, to 107 on August 1, 2009.

Question illustration
A
low production
B
inflation
C
budget deficit
D
unemployment
5

Read the scenario.The citizens of Country D have noticed that the average prices of most goods within their nation have begun to rise. At the same time, employers are not raising wages at the same rate. The combination of these challenges has resulted in a decrease in overall demand, causing a decline in GDP.

A
unemployment
B
stagflation
C
high production
D
high wages
6

The graph shows the number of employed workers in the United States in nonfarm jobs from 2008 to 2013.

Question illustration
A
reducing the size of its armed forces
B
laying off unnecessary workers
C
decrease taxes to increase consumers' money supply
D
encouraging people to travel overseas
7

Rules ensuring that businesses offer safe products to consumers are part of a nation's

A
trade policy.
B
monetary policy.
C
regulatory policy.
D
fiscal policy.
8

Economic interdependence means that economic policies must balance the needs of

A
all governments in the world.
B
governments, individuals, and businesses.
C
small businesses and large corporations.
D
both wealthy and poor individuals.
9

Which statements describe a free enterprise system? Check all that apply.

A
Citizens can own property.
B
The government employs all workers.
C
Supply and demand drives production.
D
Consumers and producers make their own decisions.
E
Citizens can accumulate wealth.
F
The government sets prices and wages.
10

When an economy suffers from low production, a country cannot

A
worry about unemployment.
B
change the tax rate.
C
provide adequate funding for public safety.
D
enjoy a steady rate of economic growth.

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