Chapter 1

Question 1

value

1-1

Answer 1

The relationship between the price of a good or a service and the benefits it offers its customers.

Question 2

Business

1-1

Answer 2

Any activity that provides goods and services in an effort to earn a profit.

Question 3

Profit

1-1

Answer 3

The money a business earns in sales (or revenue) minus expenses, such as the cost of goods and the cost of salaries.

Question 4

X - Y = Profit (or Loss)

1-1

Answer 4

Revenue - Expenses = Profit(or Loss)

Question 5

Loss

1-1

Answer 5

When a business incurs expenses that are greater than its revenue.

Question 6

Entrepreneurs

1-1

Answer 6

People who risk their time, money, and other resources to start and manage businesses.

Question 7

standard of living

1-1

Answer 7

The quality and quantity of goods and services available to a population.

Question 8

quality of life

1-1

Answer 8

The overall sense of well-being experienced by either an individual or a group.

Question 9

not-for-profit organizations

1-1

Answer 9

Business-like establishments that employ people and produce goods and services with the fundamental goal of contributing to the community rather than generating financial gain.

Question 10

factors of production

1-1

Answer 10

Four fundamental elements—natural resources, capital, human resources, and entrepreneurship—that businesses need to achieve their objectives. Some combination of these factors is crucial for an economic system to create wealth.

Question 11

business environment

1-1

Answer 11

The setting in which business operates. The five key components are economic environment, competitive environment, technological environment, social environment, and global environment.