Exam 1 (ch. 1-5) Flashcards
Customer satisfaction, not production efficiency, was the focus of the production era.
False
Following one’s passion in regard to a career guarantees a big paycheck.
False
Capital is not a factor of production.
False
The Industrial Revolution Era encouraged workers to become individual owners and to take kpride in the production process.
False
A product has value when its benefits to the customer are less than the price that the customer pays
False
Natural Resources
Inputs that offer value in their natural state (fossil fuels, minerals, water, etc.)
Entrepeneurship Era
- Second half of the 1800s.
- Large-scale entrepeneurs emerged, building business empires that raised overall standard of living.
- Laws passed to protect consumers and workers.
Diversity
A variety of demographics (age, race, religion, gender)
Effects of Aging Population (Opportunities and Threats)
Opportunities:
- Companies that focus on elderly will boom
- Products may be redesigned to better accomodate elderly
- Companies with older employees will benefit
Threats:
- Smaller workforce
- Companies will compete HARD for top talent
- Taxes may increase
- Consumer market may shrink
The government has a budget deficit when spending is lower than revenue.
False
Socialism
- Gov should own & operate key enterprises that directly affect public welfare.
- Tend to have higher taxes to dist. wealth more evenly
Communism
- Public ownership of all enterprises.
- Under direction of strong central gov
- Communist countries didn’t thrive
- People unable to choose where to work
- Extremely corrupt
- North Korea and Cuba still communist, continue to fail
Productivity
- Relationship between production of goods/services and the resources required to produce them
- -Amount of Input divided by amount of output–
GDP
- Total value of all final goods/services produced within a nations physical boundaries over a given period of time.
- Used to measure economic performance and compare to other nations
What happens in the Recovery phase?
- Rising economic growth & employment
- Businesses expand, consumers begin to spend more
- Transition period between contraction & expansion
Seasonal Unemployment
Job loss related to the time of year (construction, agriculture, holiday workers)
Debt ceiling
-Max amount of money Congress lets the gov’t borrow
Fiscal Cliff
Gov’t spending cuts and sharp tax increase
-can happen after debt ceiling increase
Countries with the highest trade barriers in international trade have the least competition.
True
If a firm contracts with a foreign producer, does that ensure an obligation that those factories adhere to ethical standards?
Yes. Companies will receive consumer backlash if they fail to do so.
Do licensors in foreign licensing run the risk that the licensees become their competitors?
Yes
What kind of assistance is offered by the World Bank?
- Technical advice about infrastructure, communications, health, education
- Financial assistance with low interest loans.
Are quotas levied against exports considered taxes?
No
Balance of Payment
Measure of total flow of money into/out of a country
-can be a deficit or surplus
