Question 1

Fiscal and monetary policies adopted by the Carter administration in the first half of his term resulted in

Accepted Answer

A)   stable prices and low unemployment.
B)   deflation.
C)   a rapid rise in the inflation rate.
D)   a balanced federal budget.

Question 2

By 1994, the percentage of the U.S. labor force employed in agriculture was

Accepted Answer

A)   less than 3 percent.
B)   between 5 and 7 percent.
C)   about 10 percent.
D)   15 percent.

Question 3

The financial crisis that began in 2007

Accepted Answer

A)   was predicted in detail by Alan Greespan and Ben Bernanke.
B)   was centered on subprime lending and the complex financial instruments based on subprime loans.
C)   was caused by a downturn in the stock market.
D)   None of the above are correct.

Question 4

The existence of external costs means that

Accepted Answer

A)   the producer's marginal cost is greater than the marginal social cost of production.
B)   the producer's marginal cost is less than the marginal social cost of production.
C)   the consumer's marginal benefit is greater than the marginal social benefit of the good.
D)   the consumer's marginal benefit is less than the marginal social benefit of the good

Question 5

Market-oriented economists favor the use of _____ to solve the global warming problem.

Accepted Answer

A)   explicit emission targets
B)   taxes on emissions
C)   tradable rights
D)   Both (a)  and (b) 
E)   Both (b)  and (c)

Question 6

Under the deficiency payments system, which was used to subsidize grain production,

Accepted Answer

A)   the government purchased all surplus grain and destroys it.
B)   deficiency payments were increased when farmers cultivated their land more intensively.
C)   farmers were required reduce cultivated acreage by 10 percent.
D)   farmers had a greater incentive to engage in beneficial crop rotation. D

Question 7

If the government-imposed price of corn is greater than the market price,

Accepted Answer

A)   the quantity of corn supplied will exceed the quantity of corn demanded.
B)   the quantity of corn supplied will be less than the quantity of corn demanded.
C)   the demand curve for corn will increase.
D)   the supply curve for corn will increase.

Question 8

In early 1996, Congress passed the "Freedom to Farm Bill."  Following the bill's enactment,

Accepted Answer

A)   farmers found that competition from international agriculture declined.
B)   farm prices rose steadily for the next 4 years.
C)   agriculture was completely deregulated, and farmers began to operate without any government subsidies or assistance.
D)   farm prices fell, leading Congress to authorize emergency payments to farmers in 1998 and 1999.

Question 9

Following WWII, savings and loan associations (S&Ls)  emerged as serious competitors of commercial banks, especially in the market for

Accepted Answer

A)   loans to new businesses.
B)   home mortgages.
C)   trust funds.
D)   government bond sales.

Question 10

The passage of major pieces of consumer protection legislation in the postwar period

Accepted Answer

A)   was one of the most dramatic development of that period.
B)   was influenced by the "red scare," and other hysteria over rumors of deliberate sabotage of consumer products.
C)   often were the result of highly visible public tragedies.
D)   Both a and b are correct.
E)   Both a and c are correct.

Question 11

Which of the following federal farm programs was successful in reducing agricultural surpluses?

Accepted Answer

A)   The Agricultural Act of 1948
B)   The Emergency Act of 1978
C)   The Emergency Feed Grain Bill of 1961
D)   The Soil Bank Act of 1956

Question 12

Federal support for road building into publicly owned commercial forests has caused

Accepted Answer

A)   an increase in the supply of timber.
B)   an increase in the demand for timber.
C)   higher timber prices.
D)   a shortage of timber.
E)   All of the above.

Question 13

During the postwar period, changing patterns of consumer demand led to changes in the distribution of jobs in the US economy.  In particular, the income elasticity of demand for many consumer products was ____________ the income elasticity of demand for services, such as medical care and insurance.

Accepted Answer

A)   less than
B)   greater than
C)   equal to

Question 14

The income elasticity of demand for agricultural products is typically

Accepted Answer

A)   less than zero.
B)   greater than zero, but less than one.
C)   greater than one.
D)   infinity. B

Question 15

New Deal environmental policies included all of the following except :

Accepted Answer

A)   withdrawal of much of the public domain from private entry.
B)   the use of the "soil bank" to encourage agricultural conservation.
C)   projects such as the TVA that simultaneously protected many resources in a region.
D)   the establishment of Yellowstone as a national park.

Question 16

The Federal Reserves responses to the financial crisis that began in 2007 include

Accepted Answer

A)   cautious cuts in the Federal funds rate.
B)   large expansions of credit.
C)   underwriting lending in many markets.
D)   All of the above are correct.
E)   Only b and c are correct.

Question 17

In the 1960s and 1970s the U.S. passed several major consumer safety laws, including the Flammable Fabrics Act and the Child Protection Act.  The economic impact of such legislation may include all of the following except :

Accepted Answer

A)   reducing the price of the regulated product.
B)   increasing the cost of producing the regulated product.
C)   reducing the supply of the regulated product.
D)   reducing competition within the regulated industry.

Question 18

Comparisons between industrialized nations and less-developed countries indicates that as income rises, the demand for a clean and well-preserved environment

Accepted Answer

A)   increases by a proportional amount.
B)   decreases by a proportional amount.
C)   increases by a more than proportional amount.
D)   decreases by a less than proportional amount. C

Question 19

All of the following changes characterize the postwar agricultural sector except

Accepted Answer

A)   the rise of corporate farms.
B)   increasing reliance on expensive, large-scale machinery.
C)   innovations by federal and state laboratories that increased output.
D)   increasing numbers of tenant farms in the South.

Question 20

After 1960, all of the following declined except

Accepted Answer

A)   the number of U.S. farms.
B)   the portion of U.S. labor force employed by the agricultural sector.
C)   the total amount of U.S. land devoted to farming.
D)   the average acreage per U.S. farm.

Exam 27: The Changing Role of the Federal Government: Consumer Safety, Agriculture, the Environment, and Housing

Fiscal and monetary policies adopted by the Carter administration in the first half of his term resulted in

Correct AnswerverifiedShow Answer

By 1994, the percentage of the U.S. labor force employed in agriculture was

Correct AnswerverifiedShow Answer

The financial crisis that began in 2007

Correct AnswerverifiedShow Answer

The existence of external costs means that

Correct AnswerverifiedShow Answer

Market-oriented economists favor the use of _____ to solve the global warming problem.

Correct AnswerverifiedShow Answer

Under the deficiency payments system, which was used to subsidize grain production,

Correct AnswerverifiedD

If the government-imposed price of corn is greater than the market price,

Correct AnswerverifiedShow Answer

In early 1996, Congress passed the "Freedom to Farm Bill." Following the bill's enactment,

Correct AnswerverifiedShow Answer

Following WWII, savings and loan associations (S&Ls) emerged as serious competitors of commercial banks, especially in the market for

Correct AnswerverifiedShow Answer

The passage of major pieces of consumer protection legislation in the postwar period

Correct AnswerverifiedShow Answer

Which of the following federal farm programs was successful in reducing agricultural surpluses?

Correct AnswerverifiedShow Answer

Federal support for road building into publicly owned commercial forests has caused

Correct AnswerverifiedShow Answer

During the postwar period, changing patterns of consumer demand led to changes in the distribution of jobs in the US economy. In particular, the income elasticity of demand for many consumer products was ____________ the income elasticity of demand for services, such as medical care and insurance.

Correct AnswerverifiedShow Answer

The income elasticity of demand for agricultural products is typically

Correct AnswerverifiedB

New Deal environmental policies included all of the following except :

Correct AnswerverifiedShow Answer

The Federal Reserves responses to the financial crisis that began in 2007 include

Correct AnswerverifiedShow Answer

In the 1960s and 1970s the U.S. passed several major consumer safety laws, including the Flammable Fabrics Act and the Child Protection Act. The economic impact of such legislation may include all of the following except :

Correct AnswerverifiedShow Answer

Comparisons between industrialized nations and less-developed countries indicates that as income rises, the demand for a clean and well-preserved environment

Correct AnswerverifiedC

All of the following changes characterize the postwar agricultural sector except

Correct AnswerverifiedShow Answer

After 1960, all of the following declined except

Correct AnswerverifiedShow Answer

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D

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B

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C

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