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Bus 100 > Chapter 1 > Flashcards

Chapter 1 Flashcards

1
Q

The funds needed to create and operate a business enterprise can be referred to as ________.

A

capital

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2
Q

A centralized government controls all or most of the factors of production in a(n) ________ economy.

A

planned

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3
Q

A ________ economy has characteristics of both planned and market economies.

A

mixed market

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4
Q

The term ________ refers to the willingness and ability of buyers to purchase a product, good, or service.

A

demand

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5
Q

The price at which the quantity of goods demanded and the quantity of goods supplied are equal is referred to as ________.

A

the equilibrium price

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6
Q

juan, the owner of Joe’s Pizza Palace, has noticed that when he increases the price of his pizzas by $2.00, the number of pizzas that he sells drops by 20 percent. Juan has discovered ________.

A

the law of demand

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7
Q

A ________ occurs when the quantity supplied exceeds the quantity demanded.

A

surplus

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8
Q

Of the following, which is a way in which monopolistic competition differs from perfect competition?

A

In a market characterized by monopolistic competition, individual firms have some control over price.

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9
Q

Competition in which there are a handful of very large sellers, market entry is difficult, and a company can have major impact on the product price is known as ________.

A

oligopoly

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10
Q

Which of the following best defines the term business cycle?

A

the pattern of short-term ups and downs in an economy

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11
Q

organization that provides goods or services to earn
profits

A

Business

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12
Q

difference between a business’s revenues and its
expenses

A

Profits

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13
Q

everything outside an organization’s boundaries that
might affect it

A

External Environment

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14
Q

the environment in
which a firm conducts operations and derives revenues

A

Domestic Business Environment

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15
Q

international forces
that affect a business and includes international trade
agreements, international economic conditions, and
political unrest

A

Global Business Environment

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16
Q

ways by which firms
create value for their constituents

A

Technological Environment

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17
Q

the relationship between
business and government

A

Political-Legal Environment

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18
Q

ncludes the customs,
mores, values, and demographic characteristics of the
society and determines the business standards that a
society is likely to value and accept

A

Sociocultural Environment

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19
Q

includes relevant
conditions that exist in the economic system in which a
company operates

A

The Economic Environment

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20
Q

a nation’s system for allocating its resources among
its citizens

A

Economic system

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21
Q

includes the physical and
intellectual contributions people make while engaged in
economic production and is also called human resources
or human capital.

A

Labor (Human Resources)

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22
Q

is the term used to describe the financial
resources needed to operate a business.

A

Capital

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23
Q

is a person who accepts the risks and
opportunities entailed in creating and operating a new
business venture.

A

Entrepreneur

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24
Q

are tangible things that
organizations use to conduct their business and include
natural resources and raw materials.

A

Physical resources

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25
Q

are data and other information
used by businesses and include market forecasts, the
specialized knowledge of people, and economic data.

A

Information resources

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26
Q

an economy that relies on a centralized government to
control all or most factors of production and to make all or
most production and allocation decisions

A

Planned Economy

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27
Q

a political system in which the government owns and
operates all factors of production

A

Communism

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28
Q

A planned economic system in which the government
owns and operates only selected major sources of
production

A

Socialism

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29
Q

individual producers and consumers control
production and allocation by creating combinations
of supply and demand

A

Market economy

30
Q

features characteristics of both planned and market
economies

A

Mixed market economy

31
Q

a system that sanctions the private ownership of
the factors of production and encourages
entrepreneurship by offering profits as an incentive

A

Capitalism

32
Q

process of converting government enterprises into
privately owned companies

A

Privatization

33
Q

the willingness and ability of buyers to purchase a
product (a good or a service)

A

Demand

34
Q

the willingness and ability of producers to offer a good
or service for sale

A

Supply

34
Q

a situation in which quantity supplied exceeds
quantity demanded

A

Surplus

35
Q

A situation in which quantity demanded exceeds
quantity supplied

A

Shortage

36
Q

– one that allows individuals to pursue their own
interests with minimal government restriction
– private property rights, freedom of choice, profits, and
competition

A

Private property rights

37
Q

ownership of the resources used to create wealth is
in the hands of individuals

A

Private enterprise system

38
Q

you can sell your labor to any employer you choose

A

Freedom of choice

39
Q

the lure of profits leads some people to abandon the
security of working for someone else and assume the
risks of entrepreneurship

A

Profits

40
Q

occurs when two or more businesses vie for the same
resources or customers

A

Competition

41
Q

market or industry characterized by numerous buyers
and relatively numerous sellers trying to differentiate
their products from those of competitors

A

Monopolistic Competition

42
Q

market or industry characterized by a handful of
(generally large) sellers with the power to influence
the prices of their products

A

Oligopoly

43
Q

market or industry in which there is only one producer
that can therefore set the prices of its products

A

Monopoly

44
Q

industry in which one company can most efficiently
supply all needed goods or services

A

Natural Monopoly

45
Q

– statistics that show whether an economic system is
strengthening, weakening, or remaining stable
– help assess the performance of an economy

A

Economic indicators

46
Q

the pattern of short-term ups and downs (or
expansions and contractions) in an economy

A

Business cycle

47
Q

– the total quantity of goods and services produced by
an economic system during a given period
– primary measure of growth in the business cycle

A

Aggregate output

48
Q

the total quantity and quality of goods and services
that they can purchase with the currency used in their
economic system

A

Standard of living

49
Q

– refers to the total value of all goods and services
produced within a given period by a national
economy through domestic factors of production
– measure of aggregate output

A

Gross domestic product (GDP)

50
Q

– refers to the total value of all goods and services
produced by a national economy within a given
period regardless of where the factors of production
are located

A

Gross national product (GNP)

51
Q

gross domestic product (GDP) measured in current
dollars or with all components valued at current
prices

A

Nominal GDP

52
Q

the principle that exchange rates are set so that the
prices of similar products in different countries are
about the same

A

Purchasing Power Parity

53
Q

measure of economic growth that compares how
much a system produces with the resources needed
to produce it

A

Productivity

54
Q

the amount of money the government owes its
creditors

A

National Debt

55
Q

– the economic value of all the products that a country
exports minus the economic value of its imported
products
– Positive or negative balance

A

Balance of trade

56
Q

condition in which the amount of money available in an
economic system and the quantity of goods and services
produced in it are growing at about the same rate

A

Stability

57
Q

occurs when widespread price increases occur throughout
an economic system

A

Inflation

58
Q

a measure of the prices of typical products purchased by
consumers living in urban areas

A

Consumer Price Index (CPI)

59
Q

the level of joblessness among people actively
seeking work in an economic system

A

Unemployment

60
Q

a period during which aggregate output, as
measured by GDP, declines

A

Recession

61
Q

a prolonged and deep recession

A

Depression

62
Q

policies used by a government regarding how it
collects and spends revenue

A

Fiscal Policies

63
Q

policies used by a government to control the size of
its money supply

A

Monetary Policies

64
Q

government economic policy intended to smooth out
fluctuations in output and unemployment and to
stabilize prices

A

Stabilization Policy

65
Q

The _____ business environment includes other businesses within the country in which the business operates.

A

domestic

66
Q

Competition from companies such as BMW, Hyundai, and Honda is a part of Ford Motor Company’s _____ business environment.

A

global

67
Q

The National Highway Traffic Safety Commission and the Occupational Safety and Health Administration are part of Ford’s _____ environment.

A

political-legal

68
Q

Ford has installed new safety features in some of its vehicles. These new features reflect Ford’s _____ environment.

A

technological

69
Q

The _____ environment includes the customs, mores, values, and demographic characteristics of the society in which an organization functions.

A

sociocultural

Bus 100 (4 decks)

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