What do you know about economics?

How confident are you that you understand background facts on economic issues? Attendees at the Annual Economic Outlook luncheon on May 16, 2013, took this test of economic knowledge. Here’s your chance to take the challenge.

How confident are you that you understand background facts on economic issues? Attendees at the Annual Economic Outlook luncheon on May 16, 2013, took this test of economic knowledge. Here’s your chance to take the challenge. When finished, check the answers below>.

1. The latest National Assessment of Educational Progress from the U.S. Education Department found less than one-half of high school seniors proficient in economics. Four out of five missed this question:

   Which of the following actions can the Federal Reserve take to reduce inflationary pressures?

   
   

   a) increase government spending b) increase the money supply c) increase interest rates d) increase tax rates

   
   
2. If you live to be 110 and start collecting Social Security at your full retirement age, what is the likely return on investment (ROI) on the funds you and your employers have invested in the Social Security system through FICA taxes?



a) 0-3% b) 3+% - 5% c) 5+% - 9%



3. In a recent “Economic Minute,” we learned that during the 2012–2013 holiday season, taxable retail sales in Arizona:



a) were about the same as in the 2011–2012 holiday season b) grew at about 4% over the prior year c) grew nearly 7% faster than in the 2011–2012 holiday season d) were the highest ever recorded for a holiday season in Arizona



4. What percentage of Maricopa County single-family home sales were purchased by investors in March 2013 to use as rentals?



a) 17% b) 27% c) 37% d) 47%



5. Only two of the largest U.S. private employers in 1960 were on the largest employer list in 2012. Name either one of the two ________________________.
   
6. The concept of “full-bodied money” has appeal…but what is it?



a) money that can be exchanged for any other currency at full price b) money that has a value as a commodity (e.g. gold or silver) that is equal to its value as money c) money that can be exchanged in full for the debt of a sovereign nation d) money that depicts the “full body” of a famous dignitary rather than just his/her head and shoulders



7. Of the 123,000 single-family homes in Scottsdale, how many are owned by lenders or banks?



a) about 20,000 b) about 2,000 c) about 1,000 d) about 200



8. Bonus question: Arizona sunshine drives the tourism sector of our economy and is a lifestyle driver for business location. What is the proportion of vehicles in Arizona that are convertibles?



a) 1.06% b) 4.64% c) 6.82% d) 9.05%



9. Which states have the highest and lowest percent convertibles? Highest state: __________________ Lowest state: _________________



Answers:

1. c) increase interest rates
2. b) 3+% – 5%
3. c) grew nearling 7% faster than in the 2011–2012 holiday season
4. b) 27 percent
5. Sears and General Electric
6. b) money that has value as a commodity (e.g. gold or silver) that is equal to its value as money
7. d) about 200



Bonus question:

a) 1.06%

Highest state: Hawaii 3.92% and lowest state: Alaska 0.34%

Sources:

• 1: U.S. Department of Education
• 2: Calculations by Robert Mittelstaedt
• 3: Dennis Hoffman and the Arizona Department of Revenue
• 4 and 7: Center for Real Estate Theory and Practice, W. P.  Carey School of Business
• 5: The New York Times, Jan. 20, 2012
• 6: Webster Dictionary
• Bonus question: Care & Driver, May 2013