Ecenomics Test Ch. 8 & 9 Flashcards
Sole proprietorship
a business owned and managed by a single individual.
business organization
establishment formed to carry on commercial enterprise.
Business license
authorization to start a business issued by the local government.
Liability
Liability is the legally bound obligation to pay debts.
Fringe benefits
Fringe benefits are payments to employees other than wages or salaries.
Partnership
business organization owned by two or more persons who agree on a specific division of responsibilities and profits.
General partnership
partners share equally in both responsibility and liability.
Limited partnership
only one partner has unlimited personal liability for the firm’s actions
Limited liability partnership
all partners are limited partners.
Articles of partnership
is a legal document that outlines the terms of the partnership.
Assets
money and other valuables belonging to an individual or business
Corporation
legal entity owned by individual stockholders.
Stock
a certificate of ownership in a corporation.
Closely held corporations
corporation that issues stock to only a few people, often family members.
Publicly held corporations
corporation that sells stock on the open market.
Horizontal mergers
joins two or more firms competing in the same market with the same good or service.
Vertical mergers
join two or more firms involved in different stages of producing the same good or service.
Conglomerates
are firms that have more than three businesses that make unrelated products
Multinational Corporations
are the world’s largest corporations that produce and sell their goods and services throughout the world.
Business franchise
is a semi-independent business that pays fees to a parent company.
Consumer cooperatives
retail outlet owned and operated by consumers.
Service cooperatives
they provide a service rather than a good.
Producer cooperatives
agricultural marketing cooperative that helps members sell their products.
Nonprofit organization
are usually in the business of benefiting society.
Professional organizations
work to improve the image, working conditions, and skill levels of people in particular occupations.
Business associations
promote the collective business interests of a city, state, or other geographical area, or of a group of similar businesses.
Trade associations
are nonprofits that promote the interests of a particular industries
Learning effect
the theory that education increases productivity and results in higher wages.
Screening effect
the theory that the completion of college indicates intelligence and a strong work ethic.
Derived demand
demand that is determined by demand for another good or service.
Equilibrium wage
the wage rate that produces neither an excess supply of workers nor an excess demand for workers in the labor market.
Lass ceiling
an unofficial, invisible barrier that prevents women and minorities from advancing in business dominated by white women.
