Economy. Chapter 8 Flashcards

1
Q

A requirement that an owner is personally and fully responsible for all losses and debts of a business; applies to proprietorships and general partnerships.

A

Unlimited Liability.

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2
Q

An unincorporated business owned and operated by two or more people who share the profits and have unlimited liability for the debts and obligations of the firm.

A

Partnership

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3
Q

A form of business organization recognized by law as a separate legal entity with all the rights and responsibilities of an individual, including the right to buy and sell property, enter into legal contracts, and sue and be sued.

A

Corporation.

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4
Q

Certificate of ownership in a corporation; can be either common or preferred stock.

A

Stock.

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5
Q

Check paid to stockholders, usually quarterly, representing a portion of corporate profits.

A

Dividend.

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6
Q

Formal contract to repay borrowed money and interest on the borrowed money at regular future intervals.

A

Bond.

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7
Q

Payment made for the use of borrowed money; usually paid at periodic intervals for long-term bonds or loans.

A

Interest.

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8
Q

Requirement in which a corporation, but not its owners, is responsible for all losses and debts of the business.

A

Limited Liability.

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9
Q

Business investment that involves renting or leasing another successful business model.

A

Franchise.

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10
Q

Measure of business profits determined by subtracting all expenses, including taxes, from revenues.

A

Net income.

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11
Q

Total amount of new funds the business generates from operations; broadest measure of profits for a firm because it includes both net income and non cash charges.

A

Cash Flow.

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12
Q

Combination of firms producing the same kind of product.

A

Horizontal Merger.

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13
Q

Combination of firms involved in different steps of manufacturing, marketing, or sales.

A

Vertical Merger.

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14
Q

Firm with four or more business making unrelated products, with no single business responsible for the majority of its sales.

A

Conglomerate.

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15
Q

Provider of investment fund to a start-up business in exchange for partial ownership of the business.

A

Venture Capitalist.

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16
Q

Using social networking to appeal to potential investors.

A

Crowfunding.

17
Q

Economic institution that operates like a business but does not seek financial gain; schools, churches, and community-service organizations are examples.

A

Nonprofit Organization.

18
Q

Nonprofit service cooperative that accepts deposits, makes loans, and provides other financial services.

A

Credit Union.

19
Q

Process of negotiation between union and management representative over pay, benefits, and job-related matters.

A

Collective bargaining.

20
Q

Nonprofit organization of local businesses whose purpose is to promote their interests.

A

Chamber of commerce.