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This test consists of 15 multiple choice questions and 5 short answer questions.

Multiple Choice Questions

1. What is the capital of the Democratic People's Republic of Korea?
(a) Honk Kong.
(b) Pyongyang.
(c) Beijing.
(d) Osaka.

2. With uniform rules and regulations, the cost of doing business in the private sector is what, according to the author in Chapter 3?
(a) Lowered.
(b) Prohibitive.
(c) Maintained.
(d) Raised.

3. A market economy delegates resources to an area where they are what, according to the author in Chapter 1?
(a) Least wealthy.
(b) Least productive.
(c) Most wealthy.
(d) Most productive.

4. What is a financial term denoting a collection of investments held by an investment company, hedge fund, financial institution or individual?
(a) Legislation.
(b) Security.
(c) Portfolio.
(d) Collateral.

5. North Korea is a single-party state under a united front led by what party?
(a) The Korean Entitlement Party.
(b) The Communist Party.
(c) The Democratic Party.
(d) The Korean Workers' Party.

6. When did the Cuban Revolution end?
(a) 1979.
(b) 1959.
(c) 1996.
(d) 1984.

7. Douglas Ivester's goal was achieving what when he told his sales team to pass free Coca-Cola around as the Berlin Wall toppled?
(a) Brand recognition.
(b) World domination.
(c) Reinstitution of Communism.
(d) Freedom for the German people.

8. What refers to the increasingly global relationships of culture, people and economic activity?
(a) Consolidation.
(b) Slavery.
(c) Monopoly.
(d) Globalization.

9. When did the Korean War begin?
(a) 1950.
(b) 1931.
(c) 1959.
(d) 1948.

10. What is a political thesis of Kim Il-sung which says that the Korean masses are the masters of the country's development?
(a) The Juche Idea.
(b) The Communist Manifesto.
(c) Capitalism.
(d) Marxism.

11. According to the author, insurance companies want to save money while doctors want to help patients and avoid what?
(a) Unnecessary fatalities.
(b) Getting sued.
(c) Spreading diseases.
(d) Losing their medical license.

12. Arab members of OPEC alarmed the developed world when they used the "oil weapon" during what war by implementing oil embargoes?
(a) The Torah War.
(b) The Yom Kippur War.
(c) The Jerusalem War.
(d) The Gaza War.

13. What is a term used in economics that refers to a market process in which "bad" results occur when buyers and sellers have asymmetric information?
(a) Gresham's law.
(b) Asset allocation.
(c) Adverse selection.
(d) Pork barrel.

14. According to the author, there are two lessons to be learned from a monopoly situation. What is the first?
(a) Governments should provide more services.
(b) Government shouldn't provide any service that could be covered by the private sector.
(c) Governments should maintain the financial infrastructure more.
(d) Government shouldn't actually do the work of maintaining infrastructure.

15. According to the author in Chapter 1, companies want to profit, and consumers want what?
(a) Results.
(b) Satisfaction.
(c) Safety.
(d) Education.

Short Answer Questions

1. According to the author, financial markets boil down to four basic simple needs. What is the second discussed in Chapter 7?

2. The Lehman Brothers bank problem in 2008 occurred because the banks weren't what, according to the author?

3. The Hope Scholarship program was shut down after how many years, according to the author?

4. In an insurance policy, what is the amount of expenses that must be paid out of pocket before an insurer will pay any expenses?

5. Gary Becker is a professor of economics, sociology at what institution?

(see the answer keys)

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