Economy & You: Checkpoint 2

Covers supply and demand, GDP, and recessions.

Five questions on supply and demand, measuring an economy’s size, and understanding recessions.

Question 1 of 5 In a free market, a shortage - where demand exceeds supply - typically causes prices to:

Fall until the shortage disappears Rise until demand and supply come back into balance Stay exactly the same Be set by the government automatically

Question 2 of 5 GDP measures:

The total wellbeing and happiness of a country's citizens The total value of goods and services produced within a country Only government spending The stock market's total value

Question 3 of 5 GDP per capita is useful because it:

Always equals total GDP Adjusts total GDP for population, giving a better sense of average output per person Measures income inequality directly Replaces the need for an unemployment rate

Question 4 of 5 A recession is commonly defined as:

Any single month of falling stock prices Two consecutive quarters of falling GDP A rise in interest rates A rise in the unemployment rate by any amount

Question 5 of 5 Historically, recessions have:

Been permanent once they begin Eventually been followed by an economic recovery Only occurred once in modern history Always been caused by the exact same trigger

← Back to Recessions: What They Are and How They End Next lesson → Trade and Tariffs Explained Simply

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