Chapter 2 and 3

Question 1

exchanged of goods or services without the use of money or to trade one thing with another with equal value

Answer 1

barter

Question 2

are business expenses that do not vary in relation into production

Answer 2

fixed cost

Question 3

fixed cost is also called

Answer 3

overhead expense

Question 4

example of fixed cost

Answer 4

rent

Question 5

directly varies with production

Answer 5

variable cost

Question 6

examples of variable cost

Answer 6

raw materials and direct labor

Question 7

the larger the enterprise, the more economy of scale is achieved

Answer 7

true

Question 8

The 4 economic benefit

Answer 8

Manufacturing side
expansion of the purchasing power of the consumers
savings in time and transactional expenses
multiplier effect

Question 9

with available credit, they may purchase in bulk to get volume discounts, or pay on time and quality for prompt payment discounts

Answer 9

wholesalers and retailers

Question 10

are able to enjoy a better quality of life without having to accumulate funds

Answer 10

end users or customers

Question 11

The cost of credit

Answer 11

interest
credit and collection overhead expenses
bad debts

Question 12

hidden costs of credit

Answer 12

vehicle insurance
registration fees

Question 13

are oftentimes charged on top of non-refundable application fees

Answer 13

service fees