FBLA ECONOMICS OBJECTIVE TEST
QUESTIONS WITH CORRECT ANSWERS 2025
AsYsupplyYdecreasesYandYdemandYdecreases,YwhatYeffectYdoesYthisYhaveYonYequilibriumYpriceYandY
quantity?Y-YCORRECTYANSWERY-PriceYindeterminant,YquantityYdecreases
WhichYofYtheYfollowingYwouldYallYdecreaseYsupply?Y-YCORRECTYANSWERY-
HigherYbusinessYtaxes,YhigherYresourceYcosts,YfewerYsuppliers
SupposeYaYpriceYfloorYisYplacedYonYwheat,YwhatYisYtheYlikelyYeffect?Y-YCORRECTYANSWERY-AYsurplus
SupposeYaYbindingYpriceYceilingYisYplacedYonYgasoline,YwhatYisYtheYlikelyYeffect?Y-
YCORRECTYANSWERY-AYshortage
AYsupplyYincreaseYwillY-YCORRECTYANSWERY-aYdecreaseYinYequilibriumYprice
AnYequalYincreaseYinYdemandYandYsupplyYwillYalwaysYresultYinYanYincreaseYinYtheYmarketYprice.Y-
YCORRECTYANSWERY-False
ComparativeYadvantageYarguesYthatYifYtwoYcountriesYspecializeYandYengageYinYfreeYtradeY-
YCORRECTYANSWERY-theyYwillYbothYgain
TheYappreciationYofYtheYyenYversusYtheYdollarYmeansYaYvacationYforYJapaneseYtouristsYcomingYtoYth
eYUnitedYStatesYisY-YCORRECTYANSWERY-cheaper
TheYappreciationYofYtheYyenYversusYtheYdollarYmeansYtheYvalueYofYtheYdollarYhasY-
YCORRECTYANSWERY-depreciated
MonetaryYpolicyYtoYfightYdemand-pullYinflationYwouldY-YCORRECTYANSWERY-
increaseYreserveYrequirement,YraiseYdiscountYrate,YandYbuyYgovernmentYsecurities
, GovernmentYborrowingYthatYleadsYtoYlessYprivateYborrowingYandYinvestingYisYcalledY-
YCORRECTYANSWERY-crowdingYoutYeffect
AYfiscalYpolicyYtoYfightYdemand-pullYinfaltionYwouldY-YCORRECTYANSWERY-raiseYtaxes
AYrecessionYcausedYbyYtooYlittleYaggregiateYdemandYwouldYrequireYwhichYofYtheYfollowingYpolicies
?Y-YCORRECTYANSWERY-expansionaryYfiscalYpolicy
SupposeY$200YcashYisYdepositedYinYaYbankYandYtheYreserveYrequirementYratioYisY10%.YHowYmuchYc
anYdemandYdepositsYexpand?Y-YCORRECTYANSWERY-$1,800
SupposeY$200YcashYisYdepositedYinYaYbankYandYtheYreserveYrequirementYratioYisY10%.YWhatYisYcons
ideredYtheYexcessYreserves?Y-YCORRECTYANSWERY-$180
SupposeY$200YcashYisYdepositedYinYaYbankYandYtheYreserveYrequirementYratioYisY10%.YWhatYisYcons
ideredYrequiredYreserves?Y-YCORRECTYANSWERY-$20
InYcompetitiveYmarkets,YtheYlong-runYeconomicYprofitYisY-YCORRECTYANSWERY-zero
IfYmaintenanceYcostsYriseYforYindustry,YwhatYeffectYwillYthisYhaveYonYexpectedYreturn?Y-
YCORRECTYANSWERY-ExpectedYreturnYdecreases
IfYtheYexpectedYreturnYrisesYandYinterestYratesYremainYconstant,YwhatYhappensYtoYinvestmentYspe
nding?Y-YCORRECTYANSWERY-grossYinvestmentYincreases
AccountingYprofitsYincludeYtheYentrepreneur'sYimplicitYcostsYofYdoingYbusinessY-
YCORRECTYANSWERY-false
QUESTIONS WITH CORRECT ANSWERS 2025
AsYsupplyYdecreasesYandYdemandYdecreases,YwhatYeffectYdoesYthisYhaveYonYequilibriumYpriceYandY
quantity?Y-YCORRECTYANSWERY-PriceYindeterminant,YquantityYdecreases
WhichYofYtheYfollowingYwouldYallYdecreaseYsupply?Y-YCORRECTYANSWERY-
HigherYbusinessYtaxes,YhigherYresourceYcosts,YfewerYsuppliers
SupposeYaYpriceYfloorYisYplacedYonYwheat,YwhatYisYtheYlikelyYeffect?Y-YCORRECTYANSWERY-AYsurplus
SupposeYaYbindingYpriceYceilingYisYplacedYonYgasoline,YwhatYisYtheYlikelyYeffect?Y-
YCORRECTYANSWERY-AYshortage
AYsupplyYincreaseYwillY-YCORRECTYANSWERY-aYdecreaseYinYequilibriumYprice
AnYequalYincreaseYinYdemandYandYsupplyYwillYalwaysYresultYinYanYincreaseYinYtheYmarketYprice.Y-
YCORRECTYANSWERY-False
ComparativeYadvantageYarguesYthatYifYtwoYcountriesYspecializeYandYengageYinYfreeYtradeY-
YCORRECTYANSWERY-theyYwillYbothYgain
TheYappreciationYofYtheYyenYversusYtheYdollarYmeansYaYvacationYforYJapaneseYtouristsYcomingYtoYth
eYUnitedYStatesYisY-YCORRECTYANSWERY-cheaper
TheYappreciationYofYtheYyenYversusYtheYdollarYmeansYtheYvalueYofYtheYdollarYhasY-
YCORRECTYANSWERY-depreciated
MonetaryYpolicyYtoYfightYdemand-pullYinflationYwouldY-YCORRECTYANSWERY-
increaseYreserveYrequirement,YraiseYdiscountYrate,YandYbuyYgovernmentYsecurities
, GovernmentYborrowingYthatYleadsYtoYlessYprivateYborrowingYandYinvestingYisYcalledY-
YCORRECTYANSWERY-crowdingYoutYeffect
AYfiscalYpolicyYtoYfightYdemand-pullYinfaltionYwouldY-YCORRECTYANSWERY-raiseYtaxes
AYrecessionYcausedYbyYtooYlittleYaggregiateYdemandYwouldYrequireYwhichYofYtheYfollowingYpolicies
?Y-YCORRECTYANSWERY-expansionaryYfiscalYpolicy
SupposeY$200YcashYisYdepositedYinYaYbankYandYtheYreserveYrequirementYratioYisY10%.YHowYmuchYc
anYdemandYdepositsYexpand?Y-YCORRECTYANSWERY-$1,800
SupposeY$200YcashYisYdepositedYinYaYbankYandYtheYreserveYrequirementYratioYisY10%.YWhatYisYcons
ideredYtheYexcessYreserves?Y-YCORRECTYANSWERY-$180
SupposeY$200YcashYisYdepositedYinYaYbankYandYtheYreserveYrequirementYratioYisY10%.YWhatYisYcons
ideredYrequiredYreserves?Y-YCORRECTYANSWERY-$20
InYcompetitiveYmarkets,YtheYlong-runYeconomicYprofitYisY-YCORRECTYANSWERY-zero
IfYmaintenanceYcostsYriseYforYindustry,YwhatYeffectYwillYthisYhaveYonYexpectedYreturn?Y-
YCORRECTYANSWERY-ExpectedYreturnYdecreases
IfYtheYexpectedYreturnYrisesYandYinterestYratesYremainYconstant,YwhatYhappensYtoYinvestmentYspe
nding?Y-YCORRECTYANSWERY-grossYinvestmentYincreases
AccountingYprofitsYincludeYtheYentrepreneur'sYimplicitYcostsYofYdoingYbusinessY-
YCORRECTYANSWERY-false
