Unit Test — Unit test Answers

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1
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Which action is an example of a service provided by an organization receiving charitable donations?

A
maintaining a public broadcasting radio station
B
renting booths at an art show on privately owned fairgrounds
C
training a competitive dance troupe within a teacher-owned studio
D
hosting children’s parties at a paint-your-own-pottery franchise
2
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What can be researched about a nonprofit organization through a regulatory agency?

A
the current number of active volunteers
B
the schedule for distributing profits to owners
C
the calendar of upcoming organizational events
D
the level of compliance to nonprofit status regulations
3

Which activity does the IRS allow nonprofit organizations to engage in?

A
advertising tax deductions for donations
B
compensating business owners based on profits
C
filing the same tax forms as for-profit organizations
D
collecting a profit as a means to generate income
4

Read the quote from philanthropic businessperson Ewing Kauffman.We cannot finance everybody who wants to get into business, but we have the capability of guiding them to the point where they can get seed money.—From Philanthropy Roundtable

A
money for startup companies
B
empty office space to expanding companies
C
electronic components for updating manufacturing systems
D
expertise to develop business plans to include in bank loan applications
5

Which action is an example of a service provided by an organization receiving charitable donations?

A
collecting old cell phones to resell
B
operating a private trash-collection business
C
distributing fliers about the benefits of recycling
D
selling specialized containers for sorting recyclable items
8

shareholderspartnersbankersboard members

A
shareholders
B
partners
C
bankers
D
board members
9

Franchises are attractive to business owners because

t
they have a proven business model.
t
they are typically inexpensive to buy.
t
they get to keep all profits.
t
they come with very little risk.
10

Which of these is a banking activity of the Fed?

p
printing money
r
regulating securities markets
s
storing money for banks
f
funding government programs
12

Government regulation is intended to

A
encourage producers to take negative actions.
B
discourage producers from taking harmful actions.
C
encourage producers to follow the Constitution.
D
discourage producers from making a profit.
13

John Maynard Keynes believed that governments should increase spending in order to

A
increase prices.
B
increase supply.
C
decrease demand.
D
increase demand.
14

The chart shows a cost-benefit analysis.

Question illustration
A
The EPA legislates and enforces more regulations that reap greater benefits than the other agencies.
B
The EPA legislates and enforces food regulations that reap greater benefits than the other agencies.
C
The EPA has a larger budget than the other agencies, and its employees work longer hours.
D
The EPA is less efficient than the other agencies, and its employees spend more money.
15

High government expenditures can lead to a bigger

A
revenue.
B
stimulus.
C
deficit.
D
surplus.
16

A diagram shows that taxes go into the government, which then go into spending.

Question illustration
G
Government Spending
T
The National Economy
T
The Federal Debt
F
Fiscal Policy
17

An entrepreneur conducted many experiments in a project without success. What characteristic must this person have to succeed?

A
a dedication to hard work
B
a willingness to admit failure
C
an ability to learn from mistakes
D
an assumption of responsibility
18

A government might enact expansionary spending when it is trying to

A
increase aggregate demand for goods.
B
decrease aggregate demand for goods.
C
slow an economic expansion.
D
lower a budget deficit.
20

Revenue and expenditures are sitting on a balance. Expenditures are lower than revenue.

Question illustration
A
a budget surplus
B
a budget deficit
C
a balanced budget
D
a plan to balance the budget

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