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

Multiple Choice Questions

1. According to the author, insurance companies want to save money while doctors want to help patients and avoid what?
(a) Spreading diseases.
(b) Losing their medical license.
(c) Getting sued.
(d) Unnecessary fatalities.

2. What is a term used in economics that refers to a market process in which "bad" results occur when buyers and sellers have asymmetric information?
(a) Adverse selection.
(b) Pork barrel.
(c) Gresham's law.
(d) Asset allocation.

3. According to the author in Chapter 1, companies want to profit, and consumers want what?
(a) Safety.
(b) Results.
(c) Education.
(d) Satisfaction.

4. What refers to the stock of competencies, knowledge and personality attributes embodied in the ability to perform labor so as to produce economic value?
(a) Futures contract.
(b) Index fund.
(c) Differential equation.
(d) Human capital.

5. Gary Becker figured that the stock of skills, education, training and an individual's health constitutes about what percent of a modern economy's wealth?
(a) 60.
(b) 42.
(c) 35.
(d) 75.

Short Answer Questions

1. What refers to reasoning which constructs or evaluates deductive arguments?

2. In what year did the French government try to address its unemployment rates with what the author calls the economic equivalent of fool's gold?

3. What is the fourth simple need of financial markets, as discussed in Chapter 7?

4. What country withdrew from OPEC in 2008 after it became a net importer of oil?

5. In finance, what is a derivative financial instrument that specifies a contract between two parties for a future transaction on an asset at a reference price?

(see the answer key)

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