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This test consists of 15 multiple choice questions and 5 short answer questions.

Multiple Choice Questions

1. What is the process of contracting a business function to someone else?
(a) Outsourcing.
(b) Managing.
(c) Motivation.
(d) Investing.

2. What is the ninth factor one should consider along with the GDP to understand an economy, according to the author in Chapter 9?
(a) Income inequality.
(b) Current account surplus/deficit.
(c) Total national happiness.
(d) National savings.

3. The United Nations Monetary and Financial Conference was commonly known as what?
(a) The San Diego conference.
(b) The New York and Europe conference.
(c) The Yosemite Falls conference.
(d) The Bretton Woods conference.

4. Americans today are how many times as rich as an American in the 1940s according to the author in Chapter 9?
(a) 2.
(b) 10.
(c) 14.
(d) 5.

5. When was the first edition of "Naked Economics: Undressing the Dismal Science" published?
(a) 2002.
(b) 2006.
(c) 1995.
(d) 1997.

6. In finance, what between two currencies is the rate at which one currency will be exchanged for another?
(a) Collateral.
(b) Exchange rate.
(c) Deductible.
(d) Devaluation.

7. What country had a bad reputation so it's government created a currency board ensuring that each of its pesos was worth one United States dollar?
(a) Argentina.
(b) Peru.
(c) Brazil.
(d) Ecuador.

8. What is generally the principled guide to action taken by the administrative or executive branches of the state with regard to a class of issues in a manner consistent with law and institutional customs?
(a) Public policy.
(b) Deductive reasoning.
(c) Pork barrel.
(d) Perverse incentives.

9. What refers to law which has been enacted by a legislature or other governing body, or the process of making it?
(a) Hedge.
(b) Gresham's law.
(c) Trade-off.
(d) Legislation.

10. In Chapter 9, the author discusses how fifteen years ago what nation was on top of the world economically?
(a) Canada.
(b) India.
(c) Japan.
(d) Spain.

11. Incomes rose between 1970 and 1999, yet those who described themselves as as "very happy" decreased from 36% to what?
(a) 14%.
(b) 29%.
(c) 62%.
(d) 44%.

12. Economists call the cycle of recession and recovery what, according to the author in Chapter 9?
(a) Perverse incentives.
(b) Gresham's law.
(c) Trade-off.
(d) The business cycle.

13. In economics, what is a sustained, long-term downturn in economic activity in one or more economies?
(a) Recession.
(b) Trade-off.
(c) Business cycle.
(d) Depression.

14. What, in economics, refers to a globally traded currency that is expected to serve as a reliable and stable store of value?
(a) Dark currency.
(b) Soft currency.
(c) Hard currency.
(d) Light currency.

15. The GDP does not consider economic activity that is what, according to the author in Chapter 9?
(a) Deductible.
(b) Unpaid.
(c) Interdependent.
(d) Subsidized.

Short Answer Questions

1. What is the economic policy of restraining trade between states through methods such as tariffs on imported goods, restrictive quotas, and a variety of other government regulations designed to allow "fair competition" between imports and goods and services produced domestically?

2. According to the author in Chapter 12, studies show that globalizing countries had what percentage higher growth rate than other countries that were less integrated in the world economy?

3. Charles Wheelan was an unsuccessful Democratic candidate in the special election for Illinois's 5th congressional district, the seat vacated by whom?

4. What is any physical or intangible entity that is owned by a person or jointly by a group of people or a legal entity like a corporation?

5. In the Epilogue, the author discusses seven issues used to understand and improve the world. What is the first?

(see the answer keys)

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