BEC 3 Flashcards
When does a surplus occurs:
When Quantity Supplied > Quantity Demanded
A product whose demand is positively related to income
Normal Good(Premium Foods such as steak)
If the income elasticity of demand is negative(demand decreases as income increases) the good is
Inferior Good
Sales of securities with only limited amount of registration and disclosure
Private Placement
A single seller of a good or service for which there are no close substitutes
Monopolist
Mutual Interdependence among firm is a major characteristic of:
Oligopoly
In a cartel, firms jointly act as:
A Monopolist
Examines individual units of an economy
Microeconomics
Examines the big picture
Macroeconomics
What are the potential risks of globalization?
- Cultural Differences
- Political Risk
- Balance of Power
- Supply Chain Mgmt
The normal sequence of a business cycle:
- Expansion
- Peak
- Contraction
- Trough
- Recovery
Which of the following might be considered the most expansionary set of fiscal policies
Increase in gov’t purchase and decrease in taxes. AD curve shift Right and Real GDP to increase
As domestic currency appreciates in value or becomes stronger:
It becomes more expensive in terms of a foreign currency.
What are the 3 risk preferences behaviors?
- Risk-Indifferent(less common)
- Risk-Averse(Most common)
- Risk-Seeking(less common)
An increase in the level of risk would not result in an increase in mgmt’s required rate of return is
Risk-Indifferent Behavior
An increase in the level of risk would result in an increase in mgmt’s required rate of return is
Risk-Averse
An increase in the level of risk would result in an decrease in mgmt’s required rate of return is
Risk-Seeking Behavior
Risk that represents a portion of a single asset’s risk that is associated with random causes & can be eliminated
Diversifiable
Referred to as Non-market, unsystematic or firm-specific risk
Diversifiable Risk
Strikes, lawsuits, regulatory actions or the loss of a key account are attributable of
Diversifiable Risk
Referred to as Market or systematic risk
Nondiversifiable Risk
Market factors that affect all firms and cannon be eliminated through diversification is attributable of
Nondiversifiable Risk
Nondiversifiable risk is attributable to factors such as
War, inflation, international incidents and political events
What is the only relevant risk is
Non-diversifiable Risk
The biggest component of GDP using the expenditure approach is:
The household sector
Personal income after taxes is called
Disposable Personal Income
The biggest component of GDP using the income approach is
Wages
Govt’s imposed maximum price that may be charged for a good or service, which leads to shortage
Price Ceiling
Govt’s imposed minimum price that may be charged for a good or service, which leads to surplus
Price Floor
Shortage occurs when
Qty demanded is > Qty Supplied
What determine weather a good is normal or inferior
Income
Equilibrium occurs when
Qty Demanded = Qty Supplied
CPI measures the costs of a market basket of specific goods commonly purchased by:
Consumer
Prints money when the money supply appears low:
The Treasury
Factors of production include:
- Land
- Labor
- Physical Capital
- Human Capital
- Entrepreneurship
A nation tends to specialize in goods for which it has
A comparative Advantage
Not consistent with full employment
Cyclical Unemployment
If there is an increase in the resources available within an economy, the economy will be capable of :
Producing more goods and services
When does cost leadership strategies fail:
Too much is focus on cutting costs of the current process
What is the main advantage of a Graphical User Interface (GUI)?
It can eliminate the need for a user to learn a complex set of commands
Which of the following definitions best describes a hot site?
An alternate site with a commercial disaster recovery service that allows the organization to continue business operations
Can not be traced directly to the final product.
Manufacturing overhead
When income rises consumers buy less of
An inferior Good
The control environment is one of the five components of internal control. How is the control environment identified within those five components?
The foundation of all other components
Refers to a specific level or range of variation that is acceptable in reaching particular objectives
Risk Tolerance
The CPU contains
primary storage, a control unit and an arithmetic/logic unit.
William J. Bryan is looking at a demand curve for widgets. In the study of economics, what does this demand curve represent?
The change in the quantity of widgets purchased as the price of widgets changes.
The function of the BUS is to:
the circuitry connecting the CPU to the primary memory and to peripheral devices. -
In computing its predetermined overhead rate, Minor Company included its factory insurance cost twice. This error will result in:
The Cost of Goods Manufactured to be overstated.
The function of input/output devices is to
Transfer data in and out of the CPU
What are some examples of input/output:
- keyboard 2.monitor 3.scanner
- printer 5.mouse 6.modem
- joystick 8.touchpad
Management compensation and performance s/b align with
maximizing long-term value for shareholders.
The Operator is responsible for
the daily computer operations of both the hardware and software
Country A can produce 10 units of Y or 20 units of X. Country B can produce 30 units of Y or 90 units of X. What can be said about this Scenario?
Country A has a comparative advantage in Y and Country B has a comparative advantage in X.
A comparative advantage occurs
when a product can be produced cheaper
Budget variance analysis based on standard unit costs is
Actual costs are compared with standard unit costs based on actual production are used to determine variances.
Process improvement initiatives should be aligned with
- needs of the firm’s customers
- embraced and communicated by management 3.implemented through training and testing
- should fit the firm’s operations and organizational culture.
Connie Roberts is a production line manager. Which of the following variances would be controllable by Connie?
- Overhead efficiency variance
- Labor efficiency variance
- Material usage variance
Three types of system documentation used by auditors and analysts are:
- Data Flow Diagrams, 2.System Flowcharts
3. Entity Relationship Diagrams
Amount of a good supplied change from something other than the price of the good
Change in Supply(Supply Change 1st)
Change is supply will cause:
S ↑ P ↓ and/or S↓ P↑
A change in the amount produces are willing & able to produce resulting solely from change in price
Change in Qty Supplied
P↑ S↑ and/or P↓ S↓
Factors that shift supply curves
E.C.O.S.T
E- change in EXPECTATIONS of the supplying firm
C- change in production COSTS
O- change in the price or
demand for other GOODS
S- change in SUBSIDIES increase or taxes
T-change in production TECHNOLOGY
Monetary policy decisions are made by:
F.O.M.C
Federal Open Market Committee
Effects of a change in supply on equilibrium
S ↑ P ↓ Qty ↑
Effects of a change in demand on equilibrium
D↑ P↑ Qty↑
What are the two ways price elasticity of demand can be measured?
- Point Method
2. Mid Point Method
In Perfect(Pure) Competition
“Many” firms in the industry
Size of firm is “small” relative to industry
Barriers to entry: None
Differentiation of Product: None( all firms sell the same commodity product)
Stragetic plans may include maintaining the market share and responsiveness of sales price to make conditions
Perfect(Pure)Competition
Stragetic plan maintaining the market share likely include a plan for enhanced product differentiation and extensive allocation of resources for advertising, marketing, product research
Monopolistic Competition
Focus on market share and call for the proper amount of advertising and ways to properly adapt to price changes or required changes in production volume
Oligopoly
Face a kinked demand curve
Oligopolists
First suggested the idea of value chain analysis
Michael Porter
According to Porter, what are the two major categories of business value activities:
Primary Activties
Support Activities
Under Michael Porter, what are the 5 forces that affect the competitive environment and profitability of the firm
- Barriers to Entry
- Market Competitiveness
- Existence of substitute products
- Bargaining power of the customers
- Bargaining power of the supplies
The most common approach in use to the application of overhead is: -
Expected annual capacity
