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

Multiple Choice Questions

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

2. What rhetorical question do economists ask, according to the author in Chapter 1?
(a) "Who smells Detroit?"
(b) "Who feeds Paris?"
(c) "Who sees London?"
(d) "Who hears New York?"

3. What is a fee paid by a borrower of assets to the owner as a form of compensation for the use of the assets?
(a) Interest.
(b) Derivative.
(c) Subsidy.
(d) Deductible.

4. What is the fourth simple need of financial markets, as discussed in Chapter 7?
(a) Insuring against risk.
(b) Storing, protecting and making profitable use of excess capital.
(c) Raising capital.
(d) Speculation.

5. In finance, what is a debt security in which the authorized issuer owes the holders a debt and, depending on the terms, is obliged to pay interest to use and/or to repay the principal at a later date?
(a) Option.
(b) Deductible.
(c) Stock.
(d) Bond.

Short Answer Questions

1. What is a financial term denoting a collection of investments held by an investment company, hedge fund, financial institution or individual?

2. According to the author in Chapter 3, it's up to whom to consider the broad social consequences of decisions In a market economy?

3. What, according to the author, motivates talented teachers to leave to go onto other professions?

4. What is a component of the financial markets for assets involved in short-term borrowing and lending with original maturities of one year or shorter time frames?

5. In Chapter 2, the author discusses how the black rhinoceros is nearly extinct and that the horns are considered what?

(see the answer key)

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