Question 1

A market economy offers entrepreneurs certain rights such as the right to own public property.

Accepted Answer

True

Question 2

An economic environment is made up of 3 key groups including businesses, charitable organizations and non-profit groups.

Accepted Answer

An economic environment is typically made up of businesses, government entities, financial institutions, and consumers. While charitable organizations and non-profit groups may also play a role in the economy, they are not considered one of the three key groups.

Question 3

Examples of factors of production includes labour, knowledge workers, entrepreneurs and cash.

Accepted Answer

While labour, knowledge workers, and entrepreneurs are examples of factors of production, cash is not typically considered a factor of production. The traditional factors of production are land, labour, capital, and entrepreneurship.

Question 4

When debt levels get too high, government officials can try to reduce the debt by increasing taxes only.

Accepted Answer

While increasing taxes is one way to reduce debt, it is not the only option. Other methods include reducing government spending, increasing economic growth, and refinancing debt.

Question 5

The total amount of frictional and structural unemployment is equal to the natural rate of unemployment plus full employment.

Accepted Answer

The total amount of frictional and structural unemployment is actually included in the natural rate of unemployment. Full employment refers to a theoretical level of unemployment where all individuals who are willing and able to work are employed, and there is only a small amount of cyclical unemployment (due to temporary fluctuations in the business cycle). Therefore, the total amount of frictional and structural unemployment is not equal to the natural rate of unemployment plus full employment, but rather is included in the natural rate of unemployment itself.

Question 6

The baby boom of the 1950s ultimately brought a large number of people into the workforce, creating an increase in cyclical unemployment.

Accepted Answer

The baby boom of the 1950s brought a large number of people into the workforce, but it primarily contributed to economic growth and expansion, not an increase in cyclical unemployment. Cyclical unemployment is related to the ups and downs of the economy, not demographic shifts.

Question 7

The unemployment rate would likely include a person laid off who decided to travel around the world.

Accepted Answer

The unemployment rate typically includes individuals who are actively seeking employment, not those who have chosen to travel or are not looking for work.

Question 8

Under socialism, with significant government ownership of certain industries, the government has the ability to control donations to non-profit groups.

Accepted Answer

The answer of Under socialism, with significant government ownership of...

Question 9

Using a microeconomic view, a business owner introducing a new product would have to consider is there enough consumer demand for this product and what is the current supply of similar products.

Accepted Answer

This statement accurately reflects key considerations that a business owner would need to take into account from a microeconomic perspective. In particular, analysis of consumer demand and the current supply of similar products is critical for determining whether a market opportunity exists for a new product, and for making decisions on pricing, marketing, and other strategic factors related to the product launch.

Question 10

Using a macroeconomic view, a restaurant increasing prices would have to consider are employment levels high and is consumer spending high.

Accepted Answer

Increases in prices by a restaurant would have a macroeconomic impact. An increase in prices may lead to reduced consumer spending, which may ultimately impact the employment levels of restaurant workers. Therefore, a restaurant increasing prices would need to consider employment levels and consumer spending from a macroeconomic perspective.

Deck 6: Section 5: Does It Matter: Society, Ethics and Business