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Economy > Test 7 > Flashcards

Test 7 Flashcards

0
Q

Four Characteristics of Pure Competition

A
  1. Many buyers and sellers
  2. Identical goods or services are offered for sale
  3. No buyer or seller knows more than any other about the market
  4. Buyers and sellers are able to enter or exit the market at will
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1
Q

Pure Competition

A

Industry made up of many small businesses

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2
Q

How many buyers and sellers are in Pure Competition?

A

Enough that no individual can influence the market

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3
Q

Monopolistic Competition

A

A market where many firms are selling similar, but not identical, products

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4
Q

Three Characteristics of Monopolistic Competition

A
  1. Many buyers and sellers
  2. Products are slightly different
  3. It is easy to enter or exit the market
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5
Q

Oligopoly

A

A market dominated by a few large firms

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6
Q

Characteristics of Oligopoly

A
  1. There are few sellers
  2. They produce and sell either identical or slightly different products
  3. There are significant barriers to entry (difficult to enter the market)
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7
Q

Barriers to Entry

A

Anything that prohibits a firm from entering the market

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8
Q

Examples of Barriers to Entry

A
  1. Legal Barriers
  2. Extremely low average total costs
  3. Exclusive ownership of a scarce resource
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9
Q

Example of Legal Barriers

A
  1. Public Franchise
  2. Patent
  3. Copyright
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10
Q

Public Franchise

A

A right granted to a firm by the government that permits that firm to provide a particular good or service, and excludes all others

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11
Q

Patent

A

A monopoly to use a new product or idea exclusively for 17 years

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12
Q

Copyright

A

The exclusive right of authors of original writings and artistic works to sell or in any way reproduce their work for their lifetime plus several more decades

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13
Q

Monopoly

A

A market where there is only one seller

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14
Q

Characteristics of Monopoly

A
  1. There is no close substitute for the product

2. The high cost of entry prohibits other companies from entering

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15
Q

Sherman Anti-Trust Act does what

A

Outlaws monopolies

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16
Q

Legal Monopolies

A
  1. Public Utilities
  2. Patent
  3. Copyright
  4. Trademarks
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17
Q

Trademark

A

A special design, name, or symbol that identifies a product, service, or company

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18
Q

Trust

A

A business combination where management and control of the member corporations are vested in a single Board of Trustees who are able to control a market, absorb or eliminate competition, fix prices, ect.
(Trusts are illegal)

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19
Q

Pool

A

An agreement to divide business and share the profits

Illegal

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20
Q

Interlocking Directorate

A

Where some of the same people serve on multiple Boards of Directors and they run all of these companies as the same company
(Illegal)

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21
Q

Stock Watering

A

Where they lie about a companies profits

Illegal

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22
Q

What is the purpose of Stock Watering

A

To sell stock of your company

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23
Q

Holding Company

A

A corporation that is organized to hold the bonds or stock of other corporations
(Legal)

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24
Q

Merger

A

A combination of two or more companies into one

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25
Q

What happens after the merger

A

The acquired firm is either dissolved or becomes a division of the combined new firm

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26
Q

Why do they have mergers?

A
  1. To add new products
  2. To benefit from increased size
  3. To reduce or eliminate competition
  4. To reduce costs
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27
Q

Type of Mergers

A
  1. Horizontal Merger
  2. Vertical Merger
  3. Conglomerate Merger
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28
Q

Horizontal Merger

A

A combination of two or more companies engaged in the same business

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29
Q

Vertical Merger

A

A combination of two or more companies involved in different steps of the same production process

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30
Q

Conglomerate Merger

A

A combination of two or more unrelated businesses

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31
Q

Sherman Anti-Trust Act

A

Prohibits any business combination that is in restraint of trade

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32
Q

Clayton Anti-Trust Act

A

Specified what acts were in restraint of trade

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33
Q

Federal Trade Commission Act

A
  1. Sets up the Federal Trade Commission

2. Prevents misleading advertising and other unfair business practices

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34
Q

Celler-KeFauver Anti-Merger Act

A

Declares mergers to be illegal where they serve to lessen competition or tend to create monopoly

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35
Q

Types of Workers

A
  1. White collar

2. Blue collar

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36
Q

Differences Between White and Blue Collar

A

Blue collar does more physical labor

White collar might make more money

37
Q

Types of Blue Collar Workers

A
  1. Skilled

2. Unskilled

38
Q

Skilled Labor

A

Have training

39
Q

Unskilled Labor

A

Not trained

40
Q

Are there more skilled or unskilled workers?

A

Unskilled

41
Q

Labor Union

A

An organization that seeks to increase the wages and improve the working conditions of its members

42
Q

Why Do People Join Labor Unions?

A
  1. Higher wages
  2. Better hours
  3. Safety/working conditions
  4. Job security
  5. Legal protection/benefits
43
Q

Types of Labor Unions

A
  1. Craft Union

2. Industrial Union

44
Q

Craft Union

A

A union organized to include workers with a specific set of skills or occupations regardless of where or what industry they are employed

45
Q

Industrial Union

A

A union organized to include all workers in an industry regardless of skills

46
Q

Open Shop

A

Union membership may never be required as a condition of employment
TN is a open shop state

47
Q

Closed Shop

A

Union membership is a condition of initial employment

Illegal

48
Q

Union Shop

A

Union membership may not be required of initial employment, but after a certain period of time Union membership may be required to keep the job

49
Q

Biggest weapon that a Labor Union can use?

A

Strike

50
Q

Strike

A

Work stoppage

51
Q

Purpose of Strikes?

A

Put pressure on the employer

52
Q

Picket

A

Standing outside the factory with signs

53
Q

Purpose of Picket Line

A
  1. To draw attention
  2. To discourage business
  3. Stop strike breakers
54
Q

Strike Breakers

A

Substitute workers to take over for the strikers

55
Q

Types of Strikes

A
  1. Jurisdictional Strike

2. Secondary Strike

56
Q

Jurisdictional Strike

A

A strike that involves one company and two labor unions

57
Q

Secondary Strike

A

A strike that involves two companies and one labor union

58
Q

How does a Jurisdictional Strike work?

A

A union goes on strike against a company because of grievances against another labor union in order to get concessions from a company

59
Q

How does a Secondary Strike work?

A

A labor union goes on strike against a company, which it has no grievances with, in order to force it to put pressure on a company that it does have grievances with

60
Q

Management Weapons Against Labor Unions

A
  1. Yellow Dog Contract
  2. Blacklisting
  3. Lockout
  4. Strike Breaker
  5. Scab
61
Q

Yellow Dog Contract

A

In order to be hired, you must pledge to not join a labor union
(Illegal)

62
Q

Blacklisting

A

Employers prevent fired employees by giving a list with their name to other companies
(Illegal)

63
Q

Lockout

A

Management closes the business in order to put pressure on the workers
(Illegal)

64
Q

Strike Breaker

A

Someone who comes in and works while the labor union members are on strike

65
Q

Scab

A

Worker that is paid to spy on other workers

66
Q

First National Labor Union

A

National Labor Union

67
Q

Leader of National Labor Union

A

Sylvias

68
Q

2nd National Labor Union

A

Knights of Labor

69
Q

Leader of Knights of Labor

A

Uriah Stephens

70
Q

How is Knights of Labor different?

A

Included:
All races
Both genders
Skilled and unskilled

71
Q

What labor union was founded after these died out?

A

American Federation Union

72
Q

Leader of the American Federation of Labor

A

Samuel Gompers

73
Q

Leader of American Railway Union

A

Eugene Debbs

74
Q

Who could be in the American Railway Union

A

Anyone who works in the railways

75
Q

Congress of Industrial Organizations (Labor Union) was formed by who

A

John Lewis

76
Q

Leader of AFL-CIO (American Federation of Labor-Congress of Industrial Organizations)

A

George Meany

77
Q

What happened to AFL-CIO

A

It became the largest labor union

78
Q

Conspiracy Doctrine

A

An individual worker has the right to make demands of an employer but when two or more worker ban together it becomes an illegal conspiracy

79
Q

Commonwealth vs. Hunt

A

Labor unions are legal

80
Q

Clayton Act

A

Excludes the labor unions from anti-trust laws

81
Q

Norris-LaGuardia Act

A

Outlaws Yellow Dog Contracts

82
Q

Wagner Act

A
  1. Guarantees a workers right to join a labor union and collective bargain
  2. Made it illegal to discriminate against labor union workers
83
Q

Fair Labor Standards Act

A

Provides for a minimum wage and anything beyond 40 hours a week, you have to be paid .5x extra

84
Q

Taft-Harley Act

A
  1. Outlaws Closed Shop

2. Gives the states the authority to pass Right to Work Laws (open shop)

85
Q

Landrum-Griffin Act

A

Purpose was to reduce corruption in labor unions
The embezzlement of union funds becomes a federal offense
Union election would use the secret ballot

86
Q

Civil Rights Act

A

Prohibits discrimination in hiring, firing, and promotions on the basis of race, color, religion, gender, or national origin

87
Q

Arbitration

A

Involved a third party known as the arbitrator to solve problems
Each side presents their case to the arbitrator
The arbitrator will then hand down a legally binding decision which can only be overturned through the courts

88
Q

Mediation

A

Involves a third party known as the mediator
Each side presents their case to the mediator
The mediator then tries to get both sides to reach an agreement
(not legally binding)

89
Q

Conciliation

A

Involves a third party that is chosen
Third party tries to get both sides to negotiate
Third party is not actively involved in the negotiation (unlike mediation)

Economy (8 decks)

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