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Austrian School of economics test
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Last updated: January 5, 2024
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| First submitted | May 6, 2021 |
| Times taken | 104 |
| Average score | 43.8% | Report this quiz | Report |
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1.
The first Austrian economists based their contribution mainly from
The Spanish scholastics
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The classical liberals
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The founding fathers, mainly thomas Jefferson
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Greeks philosophers Democrit and Aristotle
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Menger, Böhm-Bawerk and mises were influenced by the ideas of Tomás de Aquino and Juan de Mariana, in terms of logic analysis, individualism and human freedom
2.
The Austrian school relies on two principles:
Indirect realism and the invisible hand
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Free market and gold standard
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Subjetivism and methodological individualism
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Social psychology and human consciousness
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The Austrian school is human-action related, that is we cannot know what humans will decide and most of aspects in economics are individual decisions-related.
3.
The human action is, according to Mises,
Uneasiness being satisfied
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Any movement of the human body
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The state of being active
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Will put into operation
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A project may not success after the action, satisfaction may not occur.
4.
Why terms like "aggregate demand" are way less relevant to the Austrian School's Methodology
They can't relate to the actions of individuals
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They are used as a way to control the economy
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They are math-related
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5.
A sudden high demand on a product leads to
The detrimental of employment for companies furthest away from this product
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The fall of the interest rate
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The fall of the product's price
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The emerge of new stages of production
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This is the key question to evaluate a good economist according to Hayek: https://mises.org/wire/hayeks-best-test-good-economist
6.
"Thanks" to a bank loan in our modern central bank system, a company invested in nuclear fusion, it is expected to take 20 years to complete. What will tend to happen after few years?
If the company is serious and calculated expenses well, unemployment will decrease
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Many employees will abandon the project encouraged by better salaries in other energy companies
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Other energy companies will make losses
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More others companies under development will be profitable
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For a good grasp, look at the 6 consequences of credit expansion by Professor Huerta de Soto: https://www.youtube.com/watch?v=rQd7SYFEapA&t=484s
7.
Who is not austrian author
Carl Menger
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Israel Kirzner
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Murray Rothbard
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Alan Greenspan
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Huerta de Soto
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Friedrich Hayek
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If that guy was truly libertarian he would not have controlled the interest rate.
8.
What is the main indicator an entrepreneur use to decide to initiate a project in a free-currency society?
The price of the product will not decrease over time and there is a profit considering today's prices
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The profit is higher than the interest rate
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The profit is at least 20% of the investment
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Cheaper investment goods, the profit is higher than the employees' salary
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Cheaper labor, the profit is higher than the employees' salary
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When wondering of investing money first you evaluate if it is better to just lend it.
9.
According to Carl Menger, how an asset becomes money in a free society?
Relatively inflationary tend
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Relatively stable real value
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The asset must be useful for other sectors in case of fall
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10.
A recession for the Austrian school is considered as
The collapse of the market
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None of mentioned
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The lose of important sectors jobs
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The beginning of the healing of the market
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When recession explodes bad projects are detected, this is crucial for reallocation of people into genuine profitable businesses
11.
The minimum wage
Diminishes poverty and improve the quality of life for the lower class
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Increases poverty
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Keeps the same amount of poverty but improves the quality of life for the lower class
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12.
The great depression was devastating because
Stock market trading on margin
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The Dust Bowl
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The fed didn't print enough money to face the deflation
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Hoover and Roosevelt overregulated the market
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Lack of bank regulation
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13.
How has the state become that big
People required guarantees to be secured and get the rights they deserved
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More than one is correct
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After decades of propaganda, the government convinced the citizens of the need for supposed guarantees such as education and pensions
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The incipient conditions of the Industrial Revolution required big actions
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Capitalism can only exist thanks to the government, both need to grow along
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Public roads became norm in the modern Age, Education introduced in Prussia, pensions and health by Bismarck in Germany, Central Banking in England. Purchasing power decreased
14.
Entrepreneurship is defined as
Innate ability of human beings to discover profit opportunities in their environment
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Adquired abilty from which someone can improve his life condition
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Innate ability of human beings to improve their life condition
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Adquired ability from which someone can discover profit opportunities in his environment
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15.
The value of a product is determined by
The time and costs of production
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The time and costs of production + interest rate
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The invisible hand
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The subjective valuation of the market
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16.
Why a controlled interest rate at 0% is so dangerous?
All the rest
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Entrepreneurs decide to set up mistaken projects
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When inflation rises and the interest rate hike again, it leads to losses and unemployment
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It leads to a credit expansion that at last increase unemployment of people working far from the consumption
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