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Example Questions
Example Question #1 : Economics
In economic terms a "comparative advantage" is best described as __________
the unique advantages possessed by the American Republic that have allowed the country to emerge as the world's dominant economic power.
the manner in which a company with a monopoly can lower prices and ensure the continued lack of competition.
the ability of one country to produce a resource cheaper than another country can.
the belief that a country should primarily focus on ensuring a favorable balance of trade by exporting more than it imports.
the reason why the work force always has less power than those who employ them.
the ability of one country to produce a resource cheaper than another country can.
In economic terms "comparative advantage" refers to a situation where one country can produce some goods or resources at a lower cost than another country.
Example Question #1 : Economic Principles
Adam Smith is most principally associated with __________
mercantilism.
laissez-faire economics.
freedom of religion.
a system of checks and balances in government.
the social contract.
laissez-faire economics.
Adam Smith was an Enlightenment-era economic philosopher. He is most remembered for laying down the principle of free-market economics called laissez-faire economics. His theory stated that an economy would have the best success if the government does not intervene. His ideas were widely adopted in Europe and America over the next couple of centuries and were an important foundation of the spread of capitalism around the world.
Example Question #1 : Terminology And Concepts
The economic theory of mercantilism states that the primary goal of a nation should be _________________.
to protect the trading relationships established with other nations
to encourage a favorable balance of trade
to spread free market capitalism to other nations
the liberation and protection of the working classes
to prevent taxes from being levied on the wealthiest members of society
to encourage a favorable balance of trade
Mercantilism was an important economic theory in the first era of European colonialism, from roughly 1500 until 1800. With mercantilism, the primary goal of a nation, and a government, should be to regulate trade and the means of production in order to encourage a favorable balance of trade. Essentially, for a nation to succeed according to mercantilist theory, it needs to be exporting more than it is importing. This theory drove many of the actions taken by England and France, along with the other colonial powers, during the age of exploration and the age of colonialism.
Example Question #1 : Economic Principles
Someone who works during a strike, rendering the strike impotent, is called a __________.
partner
messiah
scab
quorum
trustee
scab
"Scab" is used, in a demeaning fashion, to describe someone who renders the effects of a strike less effective by continuing to work during the strike or by taking the job of a striking member of a union.
Example Question #2 : Economic Principles
Frictional unemployment occurs when __________.
the government lowers taxes
the economy is in recession
the United States is at war
unions are not able to go on strikes
workers are dissatisfied with their jobs
workers are dissatisfied with their jobs
Frictional unemployment is the name given to a situation whereby people quit because they are dissatisfied with their jobs.
Example Question #1 : Economic Principles
What name is given to the working class in the writings of Karl Marx?
Proletariat
Gentry
Clergy
Bourgeoise
Plebeians
Proletariat
In The Communist Manifesto, the working class is referred to by the latin term “proletariat.” Marx argued that the “proletariat” were essentially enslaved by the bourgeoise and the upper class who controlled the means of production and thus all the wealth and property.
Example Question #2 : Economic Principles
The Iron Law of Wages states that __________.
the value of a job is determined by how rare the skill set required is and how much money it produces
the wage of a laborer will always fall to the minimum needed to keep the laborer alive and working
workers must be paid enough so that they do not consider working for a different company
when workers are paid higher wages they are likely to do their job much better and provide a better quality product
the more people who work within an economic system the greater power they have to work together for reform
the wage of a laborer will always fall to the minimum needed to keep the laborer alive and working
The Iron Law of Wages is a famous economic term that originated during the eighteenth or nineteenth Century. It is actually difficult to track who first used the terminology or who first wrote about the idea; historians sometimes credit Malthus, Ricardo, Marx, Engels and so on. The law itself is well-understood: it states that the wage of a laborer will always fall to the very minimum needed to keep the worker working. Because of the massive competition in the labor market, employers have the power to pay their workers as little as possible, because if the worker refuses those terms, someone else will simply take the job. To rephrase: the money paid to a worker will always be the very minimum needed to keep the worker alive and working.
Example Question #2 : Terminology And Concepts
Sally starts a business that aims to produces parts for a local factory. She hires Stephanie to work for her business and physically make her product. She rents a building for her business from Ed. She buys computers and machinery from Ellen. She borrows money from Michael's bank in order to get started. She hopes to convince Allen to actually purchase her product.
In the preceding passage, which person can be said to be contributing labor as a factor of production in Sally's business?
Allen
Michael
Stephanie
Ellen
Ed
Stephanie
Labor is defined as the factor of production that is directly attributable to human effort and work. Labor is distinct from capital, in that capital describes inanimate goods that are essential to production, while labor describes the human element of production. Ed, Ellen, and Michael all contribute to the production of Sally's business, but they do so through the provision of capital. Stephanie contributes her own effort and work as a laborer for Sally. Meanwhile, Allen, as a customer, isn't directly involved in the production process.
Example Question #1 : Economics
A business that is founded by several investors collectively, who share a portion of the business and a portion of the profits is called a __________.
joint stock company
antitrust business
combined arms company
stock trust monopoly
antitrust suit
joint stock company
A joint stock company is a large scale business whereby shares (or stocks) are owned by numerous individuals, thereby distributing the responsibility for the company, the risk involved for the individual, and the profits that can be made. The development of the joint stock company by the Dutch, Russians, English, and French at various times in the sixteenth and seventeenth centuries was a very important development in economic history, providing much of the means for Europe to gain great material wealth from the age of Colonialism.
Example Question #1 : Economic Principles
A mutually beneficial relationship between two or more countries, in which they rely on one another for resources, production, or services is generally called __________
interdependence.
opportunity cost.
monopolization.
trustbusting.
specialization.
interdependence.
"Interdependence" is used to refer to a situation that exists between two or more countries in which they rely on one another for the exchange of raw resources, finished products, goods, and services to the mutual betterment of their respective economies.
All GED Social Studies Resources
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