Civics and Economics Strand Test:United States Economy

The Role of Government in the Economy

Jason Baldwin, Middle School CoordinatorAccomack County Public Schools

Summer 2008

CE.10aAn individual who has succeeded in business by taking

risks is known as—

a lawye

r.

an accountant.

a philanth

ropist

.

an entrepre

neur.

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A. a lawyer.B. an accountant.C. a philanthropist.D. an entrepreneur.

CE.10aA business organization run solely by one individual

who assumes all risks and earns all profits is a—

corp

oration.

ventu

re ca

pitalis

t.

partnersh

ip.

proprie

torsh

ip.

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A. corporation.B. venture capitalist.C. partnership.D. proprietorship.

CE.10aWal-Mart is an example of a—

sole pro

prieto

rship.

corp

oration.

corp

orate partn

ership.

business

partnersh

ip.

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A. sole proprietorship.B. corporation.C. corporate

partnership.D. business

partnership.

CE.10cIn a savings and loan bank, who owns the institution?

Credito

rs

People who have sh

ares

The govern

ment

A bank p

resid

ent

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A. CreditorsB. People who have

sharesC. The governmentD. A bank president

CE.10cIn what way do financial institution encourage people

to invest and save money?

Givi

ng finan

cial a

dvice

Paying intere

st on deposit

s

Givi

ng car lo

ans

Offerin

g competitive in

t...

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A. Giving financial advice

B. Paying interest on deposits

C. Giving car loansD. Offering competitive

interest rates on loans

CE.11aWhich government regulatory agency was developed

during the Nixon administration?

Federal C

ommunication...

Enviro

nmental Pro

tecti..

Nucle

ar Regu

latory

Com...

National R

ifle Asso

ciation

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A. Federal Communication Commission

B. Environmental Protection Agency

C. Nuclear Regulatory Commission

D. National Rifle Association

CE.11aIf Virginia wanted to buy and sell goods with a Chinese company, which governmental regulatory agency would have to approve the venture?

Enviro

nmental Pro

tecti..

Inte

rstate Commerce

C...

Secu

rities a

nd Exchang...

Federal T

rade Commission

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A. Environmental Protection Agency

B. Interstate Commerce Commission

C. Securities and Exchange Commission

D. Federal Trade Commission

CE.11bThe government collects taxes to—

encoura

ge in

vestments.

provid

e public goods a

n...

jumpsta

rt a s

luggish

ec...

provid

e salarie

s for p

oliti...

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A. encourage investments.

B. provide public goods and services.

C. jumpstart a sluggish economy.

D. provide salaries for politicians.

CE.11cWhen the government increases its spending without

adequate resources, what is most likely to occur?

Incre

ase in

taxes

No ch

ange in ta

xes

Decre

ase in

taxe

s

Debt r

eduction

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A. Increase in taxesB. No change in taxesC. Decrease in taxesD. Debt reduction

CE.11cThe government get involved in taxing, spending, and

borrowing to—

provid

e bureaucra

tic pos..

.

influence

economic

activ..

.

ensure

all c

itizens a

re pa...

to pro

vide jobs.

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A. provide bureaucratic positions for its citizens.

B. influence economic activity.

C. ensure all citizens are paying the same amount of taxes.

D. to provide jobs.