BA test 1

The market for corn in Mexico has a large number of sellers and buyers, and there is no difference in the products sold by each seller. As a result, prices are determined by the

forces of supply and demand.

Which statement is true regarding a socialist system of economy?

Central planning determines what basic goods and services are produced.

Which statement is true about GDP as a measure of a country's economic health?

It measures only those goods and services made within a country.Correct

What does the American government do to counteract economic contraction?

It reduces interest rates.

Which is the BEST example of a business trying to balance the needs of various stakeholders?

Pete's Pest Control Company is trying to develop an eco-friendly insecticide that will eliminate crop-killing pests and still adhere to environmental regulations.

What is true of economic expansion?

The standard of living rises because more people are employed and have money to spend.

What is useful in fighting inflation?

raising interest rates

Contractions of the economy lead to

recession

Generally, when a retailer announces a discount sale on all its products, what happens?

Consumers will demand more products.

How are profits handled in communist systems?

Excess income goes to the government.

What is a characteristic of the marketing economy phase of the American economy?

Expensive goods such as cars and appliances could be purchased on a time-payment plan.

In monopolistic competition, businesses have some power over the price they charge because they can make consumers aware of product differences through advertising. example:

For instance, a farm stand that sells organic and locally grown fruit and vegetables may be able to charge more than a grocery chain.

How does modified capitalism differ from pure capitalism?

In modified capitalism, the government intervenes and regulates business to some extent.

Which of the following is an example of a tangible product? Multiple Choice a. an automobile b. a movie c. a haircut d. a music concert e. a business conference

a. an automobile

Amit hired an attorney to help him draft a purchase and sale agreement for his new home. The home is an example of a product that is a(n) a. idea. b. service.Incorrect c. tangible item.Correct d. process. e. intangible good.

c. tangible item

Which communist country was the first to make strong economic gains by adopting capitalist approaches to business?

china

Which of the following is an example of an intangible product? a. a movie DVD b. a kitten c. perfume d. a music concert e. jewelry

d. a music concert

other examples of a intangible product

dry cleaning, a checkup, a movie, or sports event

The study of how resources are distributed for the production of goods and services within a social system is referred to as a. public relations. b. sociology. c. investment management. d. operations management. e. economics.

e. economics

The factors of production are the

land, labor, capital, and enterprise used to produce goods and services.

When the assembly line was applied to more industries, America evolved into a(n)

marketing economy.

Trevor owns a local farm stand. Although he sells fruit and vegetables, like the grocery store chains in the area, he has some power over the price he charges because he can offer consumers features they want. For instance, his fruit and vegetables are organic and locally grown. This is an example of

monopolistic competition.

When a business fails or does not make a profit, ________ have the most to lose in terms of finances.

owners

An entrepreneur has been primarily associated with the willingness to

take risks.

Talia is the owner of a small business. She has an HR person, an operations manager, a marketing manager, and a sales manager on staff. Who is responsible for the financial decisions that arise in the course of business?

talia, the owner

All of these statements are true of the U.S. national debt EXCEPT

the recently enacted tax cuts in the United States are projected to decrease the national debt significantly over the next 10 years.