BA Module 1

The study of the characteristics of human populations such as size, density, age, race, gender, and income is known as

demography or demographics

The statistical description of a population using characteristics such as age, gender, and income is

demography, demographics, or demographic

The elements of the business environment include the:

economic and legal environments competitive environment technological environment

Prices in a free market economy are determined by:

supply and demand

In an economic and political system called communism:

the government owns almost all the factors of production

Demography is the statistical study of:

the human population's characteristics such as size, density, age, gender, and income

The global environment affects all of the other environmental influences such as the economic, legal, and social environments because _____.

the increase in free trade among nations and technological changes have created globalization and increased competition

One government policy that helps to reduce the risks for businesses is:

to pass laws that enable businesspeople to write enforceable contracts

Balance of is the total value of a nations exports compared to its imports measured over a particular period.

trade

Government policies that favor business are:

writing laws that support writing enforceable contracts keeping interference to a minimum

Which of the following are correct with regards to a free-market economy?

An economic system in which economic decisions are made by the market Another name for capitalism.

trade is the movement of goods and services among nations without political or economic barriers.

free

The environment of business impacts all other elements of the business environment because of technological changes in communication and distribution systems. (Enter one word in the blank.)

global

Although the United States has a market of over 300 million people, there are over 7.7 billion potential customers in the market.

global, world, or international

The periodic rises and falls that occur in economies over time are called . (Enter one word in each blank.)

Blank 1: business Blank 2: cycle or cycles

Freedom of ownership is part of the and environment.

Blank 1: economic Blank 2: legal

Buyers and sellers negotiate prices for goods and services through supply and demand in a(an) economy.

Blank 1: free Blank 2: market

The two types of economic systems today are command economies and - economies. (Enter one word in each blank.)

Blank 1: free Blank 2: market

A business tries to earn a profit by providing and that satisfy people's needs and wants.

Blank 1: goods or products Blank 2: services

The supply concept refers to the relationship between the quantity of products produced and price. If the market price of a product increases, quantity supplied will . If the market price of a product decreases, quantity supplied will

Blank 1: increase or rise Blank 2: fall, decrease, drop, or decline

An entrepreneur risks and to start and manage a business.

Blank 1: time or resources Blank 2: money, capital, or wealth

The definition of a : an unfavorable balance of trade, which occurs when the value of a country's exports is less than its imports.

Blank 1: trade Blank 2: deficit

The definition of states: a favorable balance of trade, which occurs when the value of a country's exports exceeds that of its imports.

Blank 1: trade Blank 2: surplus

The total value of final goods and services produced in a country in a given year is called:

GDP

What is the total value of final goods and services produced in a country in a given year called?

Gross domestic product

In a free market economy, as the price of a product increases, so will the amount supplied. Why?

High prices lead to increased revenues, which allows firms to buy more raw materials and employ more workers. High prices lead to high profits, attracting new firms to the market.

Match the element of the business environment with the correct sector.

Legal - Contract Laws Technological - The internet Social - Demographic changes Competitive - Customer service

______ is the study of the operation of a nation's economy as a whole.

Macroeconomics

Revenue generated by Ford's factory in Mexico is included in the gross domestic product (GDP) of . (Enter one word in the blank.)

Mexico

The intersection between the supply and demand curves is:

called the equilibrium point

When the market largely determines what goods and services to produce, a economy exists. (Enter one word in the blank.)

capitalist , free-market, or free market

The global environment of business affects all of the other elements such as the Social, Technological, and Economic environments because:

changes in technology and distribution have led to interdependence between trading nations changes in communication systems make it possible to know what is happening around the world instantly a change in one country, such as a recession, affects others due to globalization

Which of the following are likely benefits to suppliers of exporting?

- Increased sales and revenues - Increased number of potential customers

Which of the following are important reasons to do business globally?

- There are more people and countries in the world markets - There are many potential customers in other countries

Advantages of doing business globally include:

- finding financing for a new business in other countries - bringing ideas for businesses in other countries to new markets

In a free market system, decisions about what and how much is produced are made by:

buyers and sellers negotiating prices

Businesses that listen carefully to their customers, believe their "customers are king" and adjust their products and services to meet customer needs are ______.

customer-driven

Listening carefully to customers to determine their wants and needs, then adjusting the organization's products, policies, and practices is indicative of a(n) ______ ______ organization.

customer-driven

The quantity of products that manufacturers or owners are willing to sell at different prices at a specific time is called:

supply

Manufacturers tend to increase the of goods and services as the price consumers are willing to pay increases.

supply, production, or quantity

Equipment such as phones, fax machines, and computers are all examples of the element of the business environment.

technological, technical, or technology

When studying the operation of a nation's economy as a whole, one is said to be taking a(n) view. (Enter one word in the blank.)

macroeconomic or macroeconomics

What is the first thing you enter into each section of the Business Model Canvas?

A guess

The Plymouth Colony is the foundation of the American System of _____________?

Capitalism and philanthropy

management-driven organizations

Organizations that are manager-driven do not focus on customer needs and will have difficulty succeeding in today's competitive environment.

production-driven organizations

Organizations that are product-driven are focusing on company needs instead of the customers' needs.

supplier-driven organizations

Organizations that are supplier-driven are not focusing on customers' needs.

How are taxes used to influence the economy?

They are used to stabilize the economy. Low taxes increase the profits a small business can earn. High taxes draw the money away from the private sector.

Which of the following should customer-driven businesses do to meet the needs of customers? (Check all that apply.)

They should establish strong relationships with suppliers. They should understand the needs and wants of customers.

The definition of ______ advantage is the advantage that exists when a country has a monopoly on producing or is able to produce something more efficiently than all other countries.

absolute

When a country has a monopoly on producing a specific product or is able to produce it more efficiently than all other countries it is said to have a(n) advantage.

absolute

When the government spends money on such projects as roads and bridges, it is expected that the money will trickle down to the consumers eventually leading to:

an increase in consumer spending

The definition of a business is:

an organization that seeks to provide goods and services to others while operating at a profit

Observing the distribution of goods and services to competing groups and understanding how society chooses to employ resources in this process is the study of

economics

Observing the distribution of goods and services to competing groups and understanding how society chooses to employ resources in this process is the study of .

economics

The study of how resources are distributed for production of goods and services within a social system is called

economics

A(n) is a person who risks time and money to start and manage a business. (Enter one word in the blank.)

entrepreneur

One way government can promote is to allow private ownership of businesses. (Enter one word in the blank.)

entrepreneurship

Nonprofit organizations are:

founded to make a contribution to the welfare of society

Mixed economies exist where some allocation of resources is made by the:

government market

As negotiation occurs between buyers demanding products and sellers supplying products, the price will be determined in the long run.

market or equilibrium

In the long run, the equilibrium price trends toward the:

market price

When some allocation of resources is made by the market and some is made by the government an economy is said to be a(n) economy.

mixed or socialist

The Federal Reserve Bank manages the money supply and interest rates in an effort to balance the economy. This is referred to as policy.

monetary

The management of the money supply and raising and lowering interest rates by the Federal Reserve Bank is called policy.

monetary

An organization whose function is to serve a societal need rather than make a profit for its owners is a(n) organization.

nonprofit

Rank the three economic systems where the system with the least amount of government involvement is on the top and the system with the most government involvement is on the bottom.

1. capitalism 2. socialism 3. Communism

Economist Joseph Schumpeter identified the four phases of long-term business cycles as ---. (Enter one word in each blank.)

Blank 1: boom Blank 2: recession Blank 3: depression Blank 4: recovery

The market price is determined where the curve intersects the curve.

Blank 1: supply Blank 2: demand

What is the political and economic system in which the government makes almost all economic decisions and owns almost all the major factors of production, as well as choosing religion, where to live, and jobs for its citizens?

Communism

______ is the study of how society chooses to employ resources to produce goods and services and distribute them for consumption among various competing groups and individuals.

Economics

True or false: The term stakeholders refers only to those who own stock in a company.

False

What are the purposes of nonprofit organizations? (Check all that apply.)

Filling an educational need Filling a societal need

A(n) economy is made up of the elements of more than one economic system, with some industries owned by the government and some privately owned..

Mixed

What is the term for all of the groups that stand to gain or lose by the policies and activities of a business and whose concerns the business needs to address?

Stakeholders

Employees vs Stakeholders

Stakeholders differ from employees, who are the people who work for a company. Employees are one type of stakeholder.

Shareholders vs Stakeholders

Stakeholders differ from shareholders, who are the people who own shares in a company. Shareholders are one type of stakeholder.

Stockholders vs Stakeholders

Stakeholders differ from stockholders, who are the people who own shares in a company. Stockholders are one type of stakeholder.

In free markets the price of a product depends on how much consumers are willing and able to buy and how much the producers are willing and able to sell. What does the market price depend on in a free market?

Supply and demand

Equipment such as phones, fax machines, and computers are all examples of which of the elements of the business environment?

Technological

Comparative advantage theory states that ...

a country should sell to other countries those products that it can produce effectively and efficiently and buy from other countries those products that it cannot produce as effectively or efficiently. Absolute advantage is the advantage that exists when a country has a monopoly on producing a specific product or is able to produce it more effectively and efficiently than all other countries.

An organization that provides goods and services while seeking to operate at a profit is a(n)

business

The periodic rises and falls that occur in economies over time are called:

business cycles

The quantity of products that people are willing to at different prices at a specific time describes the demand curve.

buy

In a free market, prices are determined by:

buyers and sellers negotiating in the marketplace

If too many firms are selling too many products of the same type, the firms will be unable to sell all their products. That causes an increase in inventory. In order to sell the remaining inventory and recover some of the money invested, the firms will have to:

decrease product prices

Fiscal policy is the government's efforts to keep the economy stable by:

decreasing taxes increasing or decreasing government spending increasing taxes

The quantity of products that people are willing to buy at different prices at a specific time is called:

demand

Mark, the marketing manager of a large U.S. corporation, realizes that Afghanistan has virtually no supply of tomatoes. He conducts a study to see what quantity of tomatoes Afghan customers would be able and willing to buy at different prices. Mark is analyzing Afghanistan's:

demand for tomatoes

In socialism:

individuals own some smaller businesses and property government owns and operates basic industries such as steel mills, utilities, or transportation

Monetary policy consists of the Federal Reserve's management of the:

interest rates money supply

Absolute advantage

is the advantage that exists when a country has a monopoly on producing a specific product or is able to produce it more effectively and efficiently than all other countries.

The operation of a nation's economy as a whole is

macroeconomics

The for goods and services in a free market are determined by buyers and sellers.

prices

An entrepreneur is a person who:

risks time and money to start and manage a business

The economic system based on the premise that some, if not most, basic industries should be owned by the government so that profits can be more evenly distributed among the people is called

socialism

The idea that some basic businesses such as steel mills, coal mines and utilities, should be owned and controlled by the government is indicative of a economic system.

socialist or command

Groups that have a strong interest in the success and outcomes of a business, such as employees, neighbors, or government regulators, are called

stakeholders

Free trade is the movement of goods and services among nations:

without political or economic barriers