Question 1
Which statement is FALSE?
A. If the U.S. can produce rice more efficiently than Japan can, the U.S. enjoys an absolute advantage.
B. Economists dislike both tariffs and import quotas.
C. Under the law of comparative advantage, total output is greatest when each product is made by the country that produces it most efficiently.
D. No nation will engage in trade with another nation unless it will gain by that trade.
Question 2
The least applicable argument for protection of U.S. industry against foreign competition is the __________ argument.
A. national security
B. infant industry
C. low wage
D. employment
Question 3
At the core of the American trade problem is that:
A. Americans spend too much on consumption.
B. the dollar is too low
C. the Japanese are excluding American products by means of high protective tariffs.
D. American manufacturers are too quality conscious and should instead concentrate on reducing costs.
Question 1
Which economist believes that all profits are linked with uncertainty and risk?
A. Frank Knight
B. Joseph Schumpeter
C. Karl Marx
D. John Maynard Keynes
Question 2
If there were no usury law the interest rate would be:
A. 6%.
B. 12%.
C. 18%.
D. 24%.
Question 3
Usury is considered the charging of:
A. higher interest rates than people are willing to pay.
B. lower interest rates than people are willing to pay.
C. unconscionably high interest rates.
D. extremely low rates of interest.
Question 1
Who said this: “The most hated sort, with the greatest reason, is usury, which makes a gain out of money itself, and not from the natural objects of it. For money was intended to be used in exchange, but not to increase at interest…of all modes of getting wealth this is the most unnatural.”
A. Aristotle
B. Joseph Schumpeter
C. Benjamin Franklin
D. Frank Knight
Question 2
Which statement is true?
A. Joseph Schumpeter said, “risk bearing is no part of the entrepreneurial function.”
B. Benjamin Franklin said, “It is better to borrow than to lend.”
C. Aristotle said, “the fair rate of interest is exactly what the market will bear.”
D. David Ricardo said, “the landlord’s return, rent, should be taxed away by the government.”
Question 3
Which is the most accurate statement?
A. Fringe and sub-prime lending should be outlawed.
B. Poor people cannot get loans in the United States.
C. Payday lenders like the Military Financial Network make low interest loans to our military personnel.
D. When poor people get personal loans, they usually pay much higher interest rates than the average American.
Question 1
The theory of rent formulated by __________ is still used by most economists today.
A. Karl Marx
B. David Ricardo
C. Frank Knight
D. Joseph Schumpeter
Question 2
When the demand for a plot of land falls, its:
A. supply will fall.
B. supply will rise.
C. price will fall.
D. price will rise.
Question 3
As the demand for land falls, rents:
A. rise and more marginal land comes into use.
B. fall and less marginal land is used.
C. rise and less marginal land is used.
D. fall and more marginal land comes into use.
Question 1
The concept that a dollar today is worth more than a dollar in the future is called:
A. the net productivity of capital.
B. economic rent.
C. present value.
D. the capitalization of assets.
Question 2
Which statement is true?
A. Joseph Schumpeter said, “risk bearing is no part of the entrepreneurial function.”
B. Benjamin Franklin said, “It is better to borrow than to lend.”
C. Aristotle said, “the fair rate of interest is exactly what the market will bear.”
D. David Ricardo said, “the landlord’s return, rent, should be taxed away by the government.”
Question 3
Which economist believes that all profits are linked with uncertainty and risk?
A. Frank Knight
B. Joseph Schumpeter
C. Karl Marx
D. John Maynard Keynes
