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Created by the EIU History Department to assist students of Eastern Illinois University in meeting the Illinois state standards for specialization in the social sciences.

The quiz questions are taken from the Illinois Certification Testing System, National Evaluation Systems Inc.

Economics- Practice Quiz
The following is a short quiz that will test your knowledge of this discipline. These questions have been devised based on similar questions that have been asked on certification tests in the past. The key for the correct answer to each question is at the bottom of this page. To keep track of your answers for each question, simply have a piece of paper and a writing utensil handy.
1. a major difference between descriptive (statistical) economics and the development of economic policy is that the development of economic policy requires economists to:
  A. distinguish between economic and noneconomic data.
  B. deal with economic goals as well as facts.
  C. examine the behavior of institutions as well as individuals .
  D. assess the relatie importance of economic data.
2. the decision-making process for production in market economies is most influenced by:
  A. income redistribution.
  B. government intervention.
  C. ssustainability concerns.
  D. profit motive.
3. Which of the following best describes a major conseqence of the growing interdependence of contemporary economic systems?
  A. a narrowing of balance of payments differentials among trading partners.
  B. an increase in the global regulation of capital mobility
  C. a narrowing of per capita income differentials among economies
  D. an increase in the global specialization of labor
4. Which of the following best describes a major function of the World Bank?
  A. to reduce barriers to international trade through the manipulation of the global money supply
  B. to encourage private investment in developing nations through loan guarantees
  C. to stabalize international exchange rates through the regulation of global capital flows
  D. to promote technological innovation in developed nations through loans to start-up businesses
5. Which of the following is the best measure of productivity growth in the U.S. economy?
  A. increases in new orders for consumer goods and materials
  B. increases in national income per worker hour
  C. increases in inventories on hand and on order
  D. increases in corporate profits as a percentage of gross national income
6.. Which of the following actions would the Federal Reserve Board most likely take to control rising inflation?
  A. Reduce the proportion of paper currency and coins in the money supply.
  B. Lower the reserve requirements for member banks.
  C. Icrease the purchase of government bonds in its open market operations.
  D. Raise the federal funds rate on loans to member banks.
7. The formulation of federal economic policy is most influenced by which of the following features of the government established by the U.S. Constitution?
  A. freedom of expression
  B. electoral college
  C. system of checks and balances
  D. due process of law
8. In which of the following situations would a manufacturing firm's demand for labor most likely decrease?
  A. when the supply of labor increases
  B. when plant reorganization raises the marginal product of an additional unit of labor
  C. when the price of the firm's products increases
  D. when the price of using caital relative to that of using labor decreases
9. Which of the following best describes the major function of the U.S. Federal Reserve System?
  A. to oversee the collection of federal tax revenue
  B. to serve as the monetary agent for the federal government
  C. to supervise govermet loan programs
  D. to provide deposit insurance for member banks
10. Which of the following is the best example of consumer sovereignty?
  A. A firm redesigns a product to reverse a decline in sales.
  B. A firm increases the wages of workers to reduce labor turnover.
  C. A firm modernizes its warehouse facilities to improve the distribution of its products.
  D. A firm takes advantage of economies of sale to reduce costs.

 

 
Answer Key

1:B, 2:D, 3:D, 4:B, 5:D, 6:D, 7:C, 8:D, 9:B, 10:A

Web-Site Last Updated 4-14-2005

  This practice quiz is a product of the Illinois Certification Testing System