National Economics Test Results

Here are the answers and the percent correct from three groups:

 Question and Answer Gen. Public H. S.
College Seniors
  % Correct % Correct % Correct
1. The best description of the purpose of the Federal Reserve is(A) The institution responsible for monetary policy/money supply
46 38 58
2. What is the basic purpose of profits in our market economy?(B) Lead businesses to produce what consumers want.
36 42 52
3. Who sets monetary policy in the United States?(D) Federal Reserve
33 25 47
4. The prices of meat products in a competitive market are determined by (C) Supply and demand.
64 72 79
5. The purchasing power of people's incomes is most affected by (A) the inflation rate.
60 53 81
6. Who makes fiscal policy in the United States?(A) President and Congress
50 50 55
7. What is an example of fiscal policy?(C) Federal Income Tax Rate Change
23 28 48
8. Which one of the following is most likely to improve the wages of American workers? (B) An increase in productivity.
68 69 77
9. What is the current national rate (percent) of civilian unemployment? (B) 4% - 6%.
22 10 26
10. Which one of the following is the most widely used measure of inflation? (A) The Consumer Price Index.
35 35 56
11. What is the current annual rate of inflation? (B) 2% - 3%
11 4 12
12. What economic policy would most likely be used to combat a recession when inflation is low? (B) An increase in the money supply.
21 17 42
13. Economic growth is measured by a positive change in which of the following? (C) The Gross Domestic Product.
40 37 56
14. There is a deficit in the federal budget when: (A) Federal government spending is greater than federal tax revenues.
51 38 66
15. If the U.S. dollar increases in value, what will most likely be the effect on U.S. exports of goods to other countries? (B) Exports would decrease.
50 38 61
Mean % Correct overall 40.7% 37.1% 54.4%

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