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This quiz consists of 5 multiple choice and 5 short answer questions through Chapters 4-7.

Multiple Choice Questions

1. What is an investment strategy that attempts to balance risk versus reward by adjusting the percentage of each asset in an investment portfolio according to the investors risk tolerance, goals and investment time frame?
(a) Adverse selection.
(b) Money market.
(c) Asset allocation.
(d) Futures contract.

2. When did the Korean War begin?
(a) 1948.
(b) 1950.
(c) 1959.
(d) 1931.

3. In an insurance policy, what is the amount of expenses that must be paid out of pocket before an insurer will pay any expenses?
(a) Collateral.
(b) Subsidy.
(c) Inflation.
(d) Deductible.

4. OPEC is an intergovernmental organization of how many oil-producing countries?
(a) 12.
(b) 8.
(c) 5.
(d) 23.

5. A market economy delegates resources to an area where they are what, according to the author in Chapter 1?
(a) Least wealthy.
(b) Most productive.
(c) Most wealthy.
(d) Least productive.

Short Answer Questions

1. According to the author, there are two lessons to be learned from a monopoly situation. What is the first?

2. What refers to a market where prices are determined by supply and demand?

3. What is a professionally managed type of collective investment scheme that pools money from many investors to buy stocks, bonds, short-term money market instruments, and/or other securities?

4. In economics and sociology, what refers to any factor that enables or motivates a particular course of action or counts as a reason for preferring one choice to the alternatives?

5. What is the capital of the Democratic People's Republic of Korea?

(see the answer key)

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