Practice Quiz

CLEP Economics Exam Prep - Question List

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21. What happens to most of the money deposited in checking accounts at a commercial bank?
  1. It is used to pay the bank's expenses.
  2. It is loaned to other bank customers.
  3. It is kept in the bank's vault until depositors withdraw the funds.
  4. It is paid to owners of the bank as return on their investment.
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22. Which of the following groups would most likely be hurt financially by unexpected inflation?
  1. People who are borrowing money at fixed rates of interest
  2. Purchasers of land who are speculating on price increases
  3. Retirees who are living on a fixed income
  4. Workers with a cost-of-living adjustment clause in their contracts
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23. Which of the following is the best measure for comparing the material standard of living among people in different nations?
  1. Imports and exports per capita
  2. Real gross domestic product per capita
  3. Consumer price index
  4. Real interest rates
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24. Suppose that the federal government initially has a balanced budget. Which of the following changes in government tax revenues and expenditures over time will definitely lead to an increase in the national debt?Tax Revenue Expenditures
  1. Increase No change
  2. Increase Decrease
  3. Decrease Increase
  4. No change Decrease
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25. International trade and specialization most often lead to which of the following?
  1. An increase in a nation's productivity
  2. A decrease in a nation's economic growth in the long term
  3. An increase in a nation's import tariffs
  4. A decrease in a nation's standard of living
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