Intro to Business

When President Obama was elected, the U.S. economy had slid into a recession. Consumer spending was low and getting worse. In an effort to stop the decline, President Obama proposed an economic stimulus package that included government spending on roads, bridges, and schools, among other things, and a tax cut that each U.S. worker would see in her or his paycheck. Apparently, President Obama was a proponent of

Keynesian economic theory

You studied for two hours each day for an entire week before your first marketing exam. When you turned in the test, you felt confident that your efforts would pay off. At the next class meeting, your instructor said she was considering curving the grades because the class average was lower than she had anticipated. Suddenly, your 98 percent score did not have the same impact that it did when you first saw it! Now the guy next to you that got an 84 percent is likely to have an "A" grade too. As you analyze this situation, you realize that it parallels an economic system such as __________, where even if you work harder than another person, you are likely to realize the same benefits.

socialism

At Memorial Hospital, Jamie operates a new state-of-the-art MRI scanner that serves approximately 10 patients during an 8-hour shift. Patients are scheduled for various lengths of time, depending on the complexity of their scan. The image quality is significantly superior to what it was on previous scanners, but the number of patients served per day remains the same. This situation attests to the fact that

the service sector has seen improvement in quality of service, but productivity remains about the same.

For the last several years, a country has been moving from a communist system to a more mixed economic system. What would most likely occur in that country?

a decrease in the level of government involvement in trade

Reyna attended university in the United States and earned a PhD in pharmacology. She liked her American friends and her life in the United States. She also enjoyed shopping for clothes that were less available and much more expensive in her native country. Upon graduation, she decided to take a position in the United States with a large pharmaceutical company. Her native country's loss of knowledge through her excellent education and training is described as

brain drain

The American Society of Civil Engineers published a report card for America's interstates. It was reported that road repairs cost the American taxpayers $67 billion per year. Through the enactment of ___________ policy, the U.S. government collects tax dollars and then spends some of these funds to maintain the infrastructure of the nation

fiscal

Keesha recently graduated from college and has been searching for a job for four months. What type of unemployment is Keesha experiencing?

frictional

At a young age, Sasha's coaches were confident she had the potential to be a world-class swimmer with a future coaching career. After four years on an athletic scholarship and Olympic experience under her belt, she chose a different path. With her savings and personal connections, she rented a space near La Jolla Shores, a popular surf spot in La Jolla, California and pursued her dream: a surf shop business. Sasha's dream was rooted in which basic right of free-market capitalism?

the right of freedom of choice

Adam Smith believed that one's self-directed gain would eventually create prosperity for many, and called the process the

invisible hand

The topics of gross domestic product (GDP), the unemployment rate, and price indexes are examples of which branch of economics?

macroeconomics

__________ economies are economic systems where some allocation of resources is made by the market and some by the government.

mixed

Raj's mom specifically asked for a CIP cast iron pan for her birthday. As Raj scanned the stock in two department stores, he found four different brands, none of which was CIP. When he found CIP in a kitchen specialty shop, he was challenged to tell the difference between his mom's choice and the others. He was reminded of his business class, in which he learned about ______________ competition, where many sellers may be offering very similar products. Through various means, each seller differentiates his product from the competition.

monopolistic

The sum of all the federal deficits over time is known as the

national debt

Keegan's wireless bill continues to increase with the price of her new phone, data charges, and long-term contract. In her geographical region, there are few choices in wireless carriers and monthly costs are very similar. What kind of competition exists here?

oligopolistic competition

The U.S. unemployment rate is a key economic indicator because most of us need jobs to maintain our standard of living. A criterion used to calculate the unemployment rate is

unemployed persons age 16 and over, who have been looking for work during the previous four weeks.

Which statement best describes a capitalistic nation?

Most or all of the factors of production and distribution are privately owned and operated for a profit.

In a free-market economic system, if consumers perceive the price for a state-of-the-art smartphone as too high for the value received, they are likely to avoid buying it. In the same light, if the

consumer's desired price is too low, producers may limit the amount produced

The CPI (consumer price index) minus food and energy costs measures

core inflation

Socialist systems tend to

discourage the best from working as hard as they can.

The way in which a country's resources are used to produce goods and services and the way those goods and services are distributed among those who desire to have them depends upon the

economic system under which the country operates

In order for the value of goods and services to be counted as part of a nation's gross domestic product, the goods and services must be

produced within the physical boundaries of a particular nation.

The Great Recession, a sharp economic downturn that begun in 2008, brought high unemployment, increased business failures, and an overall drop in living standards. According to economist Joseph Schumpeter, which business cycle occurred when the economy began to stabilize and grow?

recovery

Ralph started farming 45 years ago on 200 acres of land. Over the years, he inherited land from relatives and bought some acreage as well. Ralph now farms 2,300 acres with his son, Wayne. Ready to retire, Ralph will pass the operation to his son, and Wayne will inherit the land and equipment when Ralph dies. This is an example of the __________ in a capitalist system.

right to private property

In terms of economic systems, the trend has been for countries

that are mostly capitalist to move toward more socialism

Imagine the following: New sources of energy have become marketable and the industries involved have hired thousands to operate the emergence of new businesses. Construction companies cannot build homes fast enough for workers in the energy industry. Due to increasing salaries in several other industries that partner with energy companies, the demand for everything from food to entertainment to travel has increased. High demand has brought about shortages in some product categories. To help manage the situation in the short term,

the Fed will likely increase interest rates.