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Business Essentials > Unit 2 Test > Flashcards

Unit 2 Test Flashcards

1
Q

. Which of the following statements about wholesale trade businesses is true:
a. They operate from a variety of business premises.
b. They operate only from mail-order warehouses.
c. They operate only from distribution centers.
d. They operate in areas convenient to ultimate consumers.

A

a. They operate from a variety of business premises.

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2
Q

What do service businesses sell?
a. Retail merchandise c. Wholesale merchandise
b. Raw goods d. Intangible activities

A

d. Intangible activities

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3
Q

A large retailer feels that it has a duty to contribute to the well-being of society, so it donates a portion of its proceeds to a charity that helps the environment. The retailer is demonstrating
a. social responsibility. c. voluntary chains.
b. wholesaling. d. e-tailing.

A

a. social responsibility.

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4
Q

One way in which a business can show its social responsibility is by __________ its profits.
a. dividing c. reducing
b. maximizing d. controlling

A

b. maximizing

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5
Q

Businesses can show their social responsibility by contributing to
a. pollution. c. private causes.
b. public interests. d. promotion.

A

b. public interests.

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6
Q

A socially responsible business will attempt to give customers
a. lower quality products at reduced prices.
b. high-quality products at high prices.
c. the best products at the best prices.
d. the best products no matter what they cost.

A

c. the best products at the best prices.

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7
Q

. Social responsibility should be part of the objectives of __________ businesses.
a. all c. government
b. nonprofit d. specialized

A

a. all

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8
Q

A business that produces a product should be socially responsible to the __________ of
the product.
a. endorsers c. users
b. providers d. producers

A

c. users

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9
Q
  1. The connection between the social responsibility of a business and the community in which the business operates is that the business’s social responsibility __________ the community.
    a. depends upon c. targets the area outside
    b. targets only d. has an effect on
A

d. has an effect on

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10
Q
  1. One way in which many businesses demonstrate their social responsibility toward employees is by providing them with
    a. free meals. c. regular entertainment.
    b. a safe, secure working environment. d. a stress-free atmosphere.
A

b. a safe, secure working environment.

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11
Q

What are the three basic economic questions?
a. When will products be produced, how will products be produced, and how will
products be allocated
b. When will products be produced, what products will be produced, and how will
products be allocated
c. What products will be produced, how will products be produced, and how will
products be allocated
d. Where will products be produced, when will products be produced, and what

A

c. What products will be produced, how will products be produced, and how will
products be allocated

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12
Q

The heart of economics is
a. trade-offs. c. resources.
b. wants. d. decision-making.

A

d. decision-making.

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13
Q

Which of the following might cause supply of a good to decrease:
a. Government regulations c. Inelastic demand
b. Sales skills d. Advertising

A

a. Government regulations

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14
Q

One reason why the supply of certain products has been eliminated is because of
a. production methods. c. technology.
b. buying power. d. elasticity.

A

c. technology.

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15
Q
  1. Excess demand and excess supply cause changes in
    a. price index. c. market price.
    b. price determination. d. relative price ratio.
A

c. market price.

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16
Q

Any factor that causes changes in supply and demand will cause changes in
a. price. c. utility.
b. value. d. usefulness

A

a. price.

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17
Q

Which of the following situations involves finding another source of a limited natural resource:
a. Replacing oil with natural gas c. Paying a higher price for oil
b. Conserving the oil that we use d. Searching for oil on the ocean floor

A

d. Searching for oil on the ocean floor

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18
Q

Which of the following situations involves finding an alternative resource to use in place of a nonrenewable natural resource:
a. Passing legislation to prevent the killing of endangered animals
b. Powering a motor vehicle with biodiesel instead of gasoline
c. Generating energy from wind turbines instead of solar panels
d. Searching for oil in new locations such as the ocean floor

A

b. Powering a motor vehicle with biodiesel instead of gasoline

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19
Q

An economic good or service that is scarce is one that is
a. in limited supply. c. readily available.
b. not made in America. d. not test-marketed.

A

a. in limited supply.

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20
Q

If a good or service is scarce, consumers will usually be
a. uninterested in owning it. c. unwilling to buy it.
b. able to get as much of it as they want. d. willing to pay money to get it.

A

d. willing to pay money to get it.

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21
Q

Which of the following items is found in all economic systems:
a. Technology c. Subsistence
b. Participants d. Dollars

A

b. Participants

22
Q

The most common medium of exchange in modern economic systems is
a. barter. c. credit.
b. capital. d. money.

A

d. money.

23
Q

One of the reasons that a country needs an economic system is because it
a. is independent of other nations. c. has a limited supply of resources.
b. has limited wants and needs. d. has immigrants from several countries.

A

c. has a limited supply of resources.

24
Q

Which of the following types of economic systems adopts the fewest new ideas
and improvements:
a. Communist command c. Market
b. Socialist command d. Traditional

A

d. Traditional

25
Q

In a __________ economy, the government controls the economic system and does not allow private ownership of the means of production and distribution.
a. traditional c. socialist command
b. market d. communist command

A

d. communist command

26
Q

Government owns some basic means of production, but there is private ownership of
business under
a. communism. c. socialism.
b. capitalism. d. entrepreneurship.

A

c. socialism.

27
Q

In a __________ economy, individuals and businesses own the means of production and
distribution with limited government regulation.
a. market c. socialist command
b. traditional d. communist command

A

a. market

28
Q

An example of a country that has a socialist command economy is
a. Japan. c. China.
b. Sweden. d. North Korea.

A

b. Sweden.

29
Q

Which of the following cultures has a traditional economic system:
a. Amazon Rainforest communities c. Rural areas in Denmark
b. Villages in the Rocky Mountains d. Cuban neighborhoods

A

a. Amazon Rainforest communities

30
Q

A country that currently has a communist command economic system is
a. Japan. c. North Korea.
b. Denmark. d. India.

A

c. North Korea.

31
Q

Which of the following is a disadvantage of private enterprise:
a. Elimination of poverty c. Careful use of resources
b. Periods of unemployment d. Equal distribution of income

A

b. Periods of unemployment

32
Q

Private enterprise is based on the idea that everyone is better served when
a. businesses regularly increase their prices.
b. individuals are free to set their own goals.
c. government determines where individuals will work.
d. economic resources are controlled by the government.

A

b. individuals are free to set their own goals.

33
Q

One of the benefits of economic freedom is that it provides individuals with
a. equality in the workplace. c. the right to buy anything.
b. the opportunity for success. d. a good standard of living.

A

b. the opportunity for success.

34
Q

One of the freedoms provided to individuals by the private enterprise system is the freedom to choose
a. which taxes they will pay. c. where they will work.
b. how much they will be paid.

A

c. where they will work.

35
Q

Why are entrepreneurs important in a private enterprise system?
a. They get rid of competition.
b. They use resources inefficiently.
c. They encourage the development of new products.
d. They are responsible for deceptive advertising.

A

c. They encourage the development of new products.

36
Q

One of the differences between private enterprise and other types of economic systems is that in other systems, workers
a. may be prohibited from improving their standard of living.
b. are able to make a wide variety of economic choices.
c. are allowed to change jobs whenever they want to do so.
d. can go to work for themselves if they are dissatisfied.

A

a. may be prohibited from improving their standard of living.

37
Q

Malinda owns a home, and instead of living in it, she decides to rent it out to make more
money. Which economic freedom does this illustrate?
a. Freedom to own, use, buy, and sell private property
b. Freedom to compete for jobs
c. Freedom to choose which laws to obey
d. Freedom to control all the money you earn

A

a. Freedom to own, use, buy, and sell private property

38
Q

For which of the following do workers compete in a private enterprise system:
a. Skills c. Profits
b. Benefits d. Jobs

A

d. Jobs

39
Q

Individuals put limits on their own economic freedom by
a. making personal economic choices. c. complying with the law.
b. competing with others. d. deciding to learn new job skills.

A

a. making personal economic choices.

40
Q

One of the factors that directly limits the economic freedom of individuals in a private
enterprise system is government
a. indecision. c. services.
b. production. d. taxation.

A

d. taxation.

41
Q

Profitable businesses often help improve their local communities by
a. investing in foreign companies. c. contributing to charitable causes.
b. building facilities in other cities. d. increasing salaries of executives.

A

c. contributing to charitable causes.

42
Q

If no profit is generated for an extended period, a business must
a. lay off employees. c. invest wisely.
b. reduce expenses. d. shut down.

A

d. shut down.

43
Q

Which of the following is a situation in which people are out of work and can’t afford “extra” purchases:
a. Unexpected event c. Negative circumstance
b. Bad investment d. Bad economy

A

d. Bad economy

44
Q

A popular product is said to be
a. in demand. c. out of style.
b. late. d. available.

A

a. in demand.

45
Q

A union strike that stops production at a manufacturing plant is a(n) __________ risk.
a. financial c. strategic
b. operational d. hazard

A

b. operational

46
Q

What category of business risk includes production problems and incompetent employees?

    	a.  Operational                                          	c.  Strategic
    	b.  Hazard                                                  	d.  Financial
A

a. Operational

47
Q

When a rival’s product on the market reduces sales of your company’s product, your company is experiencing strategic risk caused by
a. regulatory and political issues. c. obsolescence.
b. changing customer needs. d. competition.

A

d. competition.

48
Q

One way that competition benefits business is by encouraging the creation of
a. new companies. c. unrelated firms.
b. more regulations. d. limited resources.

A

a. new companies.

49
Q

What motivates businesses to produce efficiently and sell effectively?
a. The desire to spend money c. The need for recognition
b. The hope of making a profit d. The chance to start a trend

A

b. The hope of making a profit

50
Q

One of the ways that competition benefits customers is by encouraging businesses to
a. develop fewer new products to sell. c. improve their existing products.
b. increase the price of their products. d. reduce the number of their services.

A

c. improve their existing products.

Business Essentials (7 decks)

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