Business100
True or False: Transportation costs have relatively little impact on a domestic firms decision to go international
False
Federal Reserve System
the central bank of the United States, which acts as the government's bank, serves member commercial banks, and controls the nation's money supply
What are products that are created domestically and transported for sale abroad?
Exports
True or False: A subsidy is a tax designed to help companies who import products
False
True or False: IF the US exports more to the Netherlands than it imports from the Netherlands, the US has a trade deficit with the country.
False
True or False: NAFTA regulates trade between the US, Europe, and Japan
False
Current ratio
A financial ratio for measuring a company's ability to pay current debts out of current assets
Pension Fund
A non deposit pool of funds managed to provide retirement income for its members
Describe the effects of subsidies
A subsidy essentially lowers the prices of domestic goods rather than raising the prices of foreign goods
True or False: The primary purpose of the WTO is to to impose tariffs on imported products
False
What organization was founded in Pacific Asia in 1967 for economic, political, social, and cultural cooperation?
ASEAN
GAAP
Accounting guidelines that govern the content and form of financial reports
Depreciation
An accounting method used to spread the cost of an asset over the years of its useful life
Current Asset
An asset that can or will be converted into cash within a year
Asset
Any economic resources expected to benefit a firm or an individual who owns it
Economic value of all of the products that a country exports minus the economic value of its imports
Balance of trade
Checking Account
Bank account funds owned by the depositor that may be withdrawn at any time by check or cash
Time deposit
Bank funds that have a fixed term of time to maturity and cannot be withdrawn earlier or transferred by check
In some South American countries, it is sometimes legal to bribe other businesses and government officials. While this practice is illegal in the US, what is it called?
Business practice laws
What refers to the associations of producers that control supply and prices?
Cartels
What country has the world's third largest economy?
China
Commercial Bank
Company that accepts deposits that it uses to make loans, earn profits, pay interest to depositors, and pay dividends to owners
Debt
Company's total liabilities
Liability
Debt owed by a firm to an outside organization
Current Liability
Debt that must be paid within one year
What refers to the practice of selling a product abroad for less than the cost of production?
Dumping
Retained Earnings
Earnings kept by a firm for its use rather than paid out as dividends
Positive trade balance
Economic condition in which a country's exports exceed its imports
Trade deficit
Economic condition in which a country's imports exceed its exports
What denotes a government order forbidding exportation or importation of a particular products from a particular country?
Embargo
Which organization is a firm that makes products in one country and then distributes and sells them in others?
Exporter
Money Market Mutual Fund
Fund of short term, low risk financial securities purchased wit the pooled assets of investor-owners
Revenues
Funds that flow into a business from the sales of goods or services
Which treaty sought to eliminate trade barriers such as tariffs and quotas?
General Agreement on Tariffs and Trade
Net income
Gross profit minus operating expenses and income taxes
Which type of organization buys products in foreign markets and then sells them for resale in its home country?
Importer
What are products created abroad and sold domestically?
Imports
Controller
Person who manages all of a firm's accounting activities (head accountant)
Primary purpose of tariffs on imports
Maintain domestic competition
Monetary Policy
Management of the nation's economic growth by managing the money supply and interest rates
M-1
Measure of the money supply that includes only the most liquid forms of money
Under which of the following treaties are Canada, US, and Mexico gradually eliminating tariffs and all other trade barriers?
NAFTA
Finance Company
Nondeposit institution that specializes in making loans to businesses and consumers
Intangible Asset
Nonphysical asset (patent or trademark) that has economic value in the form of expected benefits
Credit Union
Nonprofit, cooperative financial institution owned and run by its members, usually employees of a particular organization
Earnings per Share
Profitiability ratio measuring the net profit that the company earns for each share of outstanding stock
What denotes the practice of protecting domestic business at the expense of free market competition?
Protectionism
What is the practice of limiting the amount of certain items that can be imported from a country?
Quota
Government payment to help a domestic business compete with foreign firms
Subsidy
Individual Retirement Account
Tax-deferred pension fund that wage earners set up to supplement retirement funds
International Monetary Fund
The UN agency consisting of about 150 nations that have combines resources to promote stable exchange rates, provide temporary short-term loans, and serve other purposes
Goodwill
The amount paid for an existing business above the value of its other assets
Electronic Funds Transfer
The communication of fund-transfer information over wire, cable, or microwave
Cost Of Goods Sold
The costs of obtaining materials to make products sold by a firm during the course of a year
Liquididty
The ease with which an asset can be converted into cash
FDIC
The federal agency that ensures the safety of deposits up to $250,000 in the financial institutions that it insures
Balance Sheet
The financial statement that supplies detailed information about a firms assets, liabilities, and owners equity
Discount Rate
The interest rate at which member banks can borrow money from the Federal Reserve Bank
Prime Rate
The interest rate available to a bank's more creditworthy customers
Gross Profit
Total revenue- the cost to make the product
True or False: An import is a product made or grown abroad but sold domestically
True
True or False: Critics of protectionism charge that it drives up prices by reducing competition
True
True or False: Even free market economies often establish some system of quotas or tariffs
True
True or False: Globalization refers to the process by which countries around the world are becoming more dependent on one another
True
True or False: International firms conduct a good deal of business abroad and may even maintain overseas manufacturing facilities
True
True or False: The World Trade Organization was created to encourage international trade
True
True or false: The US has a large trade deficit with Japan, China, and Mexico: this means the US has imported more from them than we have purchased from them.
True
Fixed Asset
an asset with long-term use or value (land, buildings, etc)
Trust Services
management by a bank of an estate, investments, or other assets on behalf of an individual
M-2
measure of the money supply that includes all the components of M-1 plus the forms of money that can be easily converted into spendable forms
Which organization created the classification of countries based on per capita income?
the World Bank