Fun Trivia Questions On Economics

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Fun Trivia Questions On Economics - Quiz

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Questions and Answers
  • 1. 

    U.S. Federal income tax on the highest tax bracket peaked at what percentage in 1944?

    • A.

      78%

    • B.

      86%

    • C.

      94%

    • D.

      62%

    Correct Answer
    C. 94%
    Explanation
    In 1944, the U.S. Federal income tax on the highest tax bracket peaked at 94%. This means that individuals who fell into the highest tax bracket had to pay 94% of their income in taxes. This high tax rate was implemented during World War II to generate revenue for the war effort. It was a way for the government to fund the war and support the troops. This high tax rate was temporary and was gradually reduced in the following years.

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  • 2. 

    For 2012, a person filing singly would have to make less than what amount in order to qualify for the lowest federal income tax bracket?

    • A.

      10700

    • B.

      7700

    • C.

      9700

    • D.

      8700

    Correct Answer
    D. 8700
    Explanation
    In order to qualify for the lowest federal income tax bracket in 2012, a person filing singly would have to make less than $8,700. This means that if their income is equal to or below this amount, they would be eligible for the lowest tax rate applicable for that year.

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  • 3. 

    Which of the following types of securities does the U.S. Treasury department not sell through auction?

    • A.

      Treasury Bills

    • B.

      Savings Bonds

    • C.

      TIPS

    • D.

      Treasury Notes

    Correct Answer
    B. Savings Bonds
    Explanation
    The U.S. Treasury department does not sell Savings Bonds through auction. Savings Bonds are instead sold directly to individuals at face value. They are a type of government bond that offers a fixed interest rate over a fixed period of time. Unlike Treasury Bills, TIPS, and Treasury Notes, which are all sold through auctions, Savings Bonds can be purchased online or at financial institutions.

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  • 4. 

    The NASDAQ was created in what year?

    • A.

      1976

    • B.

      1986

    • C.

      1971

    • D.

      1981

    Correct Answer
    C. 1971
    Explanation
    The correct answer is 1971. The NASDAQ, which stands for National Association of Securities Dealers Automated Quotations, was created in 1971 as the world's first electronic stock market. It was established to provide investors with a more efficient and transparent trading platform. Unlike traditional stock exchanges, NASDAQ operates through a computerized system, allowing for faster and more accurate transactions. Since its inception, NASDAQ has grown to become one of the largest stock exchanges in the world, listing numerous technology and biotechnology companies.

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  • 5. 

    Which of the following investment types usually carries a heavy penalty for an early withdrawal?

    • A.

      Stocks

    • B.

      Mutual Funds

    • C.

      Futures

    • D.

      Certificate Of Deposit

    Correct Answer
    D. Certificate Of Deposit
    Explanation
    Certificate of Deposit usually carries a heavy penalty for an early withdrawal. This is because a Certificate of Deposit is a fixed-term investment where the investor agrees to keep their money deposited for a specific period of time, known as the maturity period. If the investor decides to withdraw their funds before the maturity period ends, they will typically incur a penalty fee. This penalty fee serves as a deterrent for early withdrawals and compensates the financial institution for the loss of interest they would have earned if the deposit had remained until maturity.

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  • 6. 

    When an individual files for Chapter 7 bankruptcy, which variety of assets is generally used to pay off a portion of their debt?

    • A.

      Non-Exempt Liquid Assets

    • B.

      Exempt Non-Liquid Assets

    • C.

      Non-Exempt Non-Liquid Assets

    • D.

      Exempt Liquid Assets

    Correct Answer
    A. Non-Exempt Liquid Assets
    Explanation
    When an individual files for Chapter 7 bankruptcy, they are required to liquidate their non-exempt assets in order to pay off a portion of their debt. Non-exempt assets are those that are not protected or exempt from being used to pay off debts. Liquid assets refer to assets that can be easily converted into cash, such as bank accounts, stocks, or bonds. Therefore, the correct answer is "Non-Exempt Liquid Assets" as these are the assets that are typically used to pay off debts in Chapter 7 bankruptcy.

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  • 7. 

    Which of the following is true of a home equity loan?

    • A.

      The Interest Rate Is Fixed

    • B.

      The Borrower Only Needs To Pay Interest Each Month

    • C.

      The Repayment Term Is Usually 30 Years

    • D.

      The Borrower Never Receives A Lump Sum

    Correct Answer
    A. The Interest Rate Is Fixed
    Explanation
    A home equity loan typically has a fixed interest rate. This means that the interest rate remains the same throughout the life of the loan, providing stability for the borrower in terms of monthly payments. Unlike adjustable-rate loans, where the interest rate can fluctuate over time, a fixed interest rate ensures that the borrower's monthly payments remain consistent.

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  • 8. 

    Which of the following is an alternative name for the Consumer Price Index?

    • A.

      Mundell Index

    • B.

      Paasche Index

    • C.

      Laspeyres Index

    • D.

      Keynes Index

    Correct Answer
    C. Laspeyres Index
    Explanation
    The Laspeyres Index is an alternative name for the Consumer Price Index. The Laspeyres Index is a price index formula that measures the average change in prices of a fixed basket of goods and services consumed by a specific group of consumers. It is commonly used to track inflation and calculate cost-of-living adjustments. The other options mentioned (Mundell Index, Paasche Index, and Keynes Index) are not alternative names for the Consumer Price Index.

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  • 9. 

    Which of the following states imposes a state-wide sales tax?

    • A.

      Montana

    • B.

      New Hampshire

    • C.

      Delaware

    • D.

      Wyoming

    Correct Answer
    D. Wyoming
    Explanation
    Wyoming is the correct answer because it is the only state listed that imposes a state-wide sales tax. Montana, New Hampshire, and Delaware do not have a state-wide sales tax.

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  • 10. 

    What is the minimum age at which you can withdraw from a Roth 401(k) and not face a 10% penalty fee?

    • A.

      59 ╜

    • B.

      57 ╜

    • C.

      56 ╜

    • D.

      58 ╜

    Correct Answer
    A. 59 ╜
    Explanation
    The minimum age at which you can withdraw from a Roth 401(k) and not face a 10% penalty fee is 59 ½. This is because the IRS imposes a penalty fee for early withdrawals from retirement accounts, including Roth 401(k)s, before the age of 59 ½.

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  • 11. 

    What phrase coined by Adam Smith describes an economy's ability to self-correct imbalances?

    • A.

      The Self-Turning Wheel

    • B.

      The Invisible Hand

    • C.

      The Closed Circle

    • D.

      The Teeter-Totter Effect

    Correct Answer
    B. The Invisible Hand
    Explanation
    The phrase coined by Adam Smith, "The Invisible Hand," describes an economy's ability to self-correct imbalances. According to Smith, when individuals pursue their own self-interest in a free market, it leads to the overall benefit of society. The invisible hand refers to the unseen forces of supply and demand that guide market participants to make rational decisions, resulting in the efficient allocation of resources and the correction of imbalances without the need for government intervention.

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  • 12. 

    As of December, 2011, which of the following company's stocks is not used to compute the Dow Jones Industrial Average?

    • A.

      Pfizer

    • B.

      Sears

    • C.

      3M

    • D.

      Verizon

    Correct Answer
    B. Sears
    Explanation
    Sears is not used to compute the Dow Jones Industrial Average as of December 2011. The Dow Jones Industrial Average is calculated using the stocks of 30 large, publicly traded companies, known as "blue-chip" stocks. These stocks are selected by the editors of The Wall Street Journal based on their reputation, stability, and industry representation. Sears, a retail company, may not have met the criteria for inclusion in the index, leading to its exclusion from the computation.

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  • 13. 

    Which of the following type of mortgage loans is usually not a target for predatory mortgage servicing?

    • A.

      Scratch And Dent

    • B.

      Fixed Rate

    • C.

      Subprime

    • D.

      Alt-A

    Correct Answer
    B. Fixed Rate
    Explanation
    Fixed rate mortgage loans are usually not a target for predatory mortgage servicing because they have a stable interest rate that does not change over the life of the loan. Predatory mortgage servicing typically involves lenders or servicers taking advantage of borrowers through unfair practices such as excessive fees, high interest rates, or deceptive loan terms. Since fixed rate loans have a predictable and consistent payment structure, they are less susceptible to these predatory practices compared to other types of mortgage loans like subprime or Alt-A loans.

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  • 14. 

    Which of the following is not an anti-counterfeiting measure instituted by the U.S. Treasury?

    • A.

      Adding A "Security Strip" To Bills

    • B.

      Making Bills Heavier

    • C.

      Add More Colors To Bills

    • D.

      Adding Larger Portraits To Bills

    Correct Answer
    B. Making Bills Heavier
    Explanation
    Making bills heavier is not an anti-counterfeiting measure instituted by the U.S. Treasury. The U.S. Treasury has implemented various security features on bills to prevent counterfeiting, such as adding security strips, incorporating more colors, and adding larger portraits. However, the weight of the bills is not a factor in their anti-counterfeiting measures.

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  • 15. 

    What market form involves a market or industry dominated by a small number of sellers?

    • A.

      Polyopoly

    • B.

      Monopoly

    • C.

      Oligopoly

    • D.

      Multiopoly

    Correct Answer
    C. Oligopoly
    Explanation
    An oligopoly is a market form in which a small number of sellers dominate the market or industry. In an oligopoly, these few sellers have significant control over the prices and competition in the market. This market structure often leads to intense competition among the sellers and can result in collusion or strategic behavior between them. Therefore, the correct answer is Oligopoly.

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  • Mar 22, 2023
    Quiz Edited by
    ProProfs Editorial Team
  • Mar 18, 2015
    Quiz Created by
    Thames
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