Lights, Camera, Business Unit 1 Review

Which change provides the most time utility for a consumer? A) Staying open for business on the weekend B) Arriving at a product trade show early C) Shopping for a product in the morning D) Asking for early delivery of a product

A) Staying open for business on the weekend Staying open for business on the weekend provides the most time utility for a consumer because the consumer can shop at a convenient time. Of course, a consumer may decide to shop for a product in the morning, if s/he so chooses. Also, consumers receive no direct time utility from a marketer's arrival time at a trade show—nor from a marketer's (or consumer's) request for early delivery of a product.

A characteristic of human wants is that they are... A) unlimited. B) unchanging. C) consistent. D) limited.

A) unlimited. In other words, when one want is satisfied, there are other wants waiting to take its place. Wants are not consistent but vary from person to person and from age group to age group. This means that your wants will change, not remain the same. Your wants are also competing. In other words, you might want more than one thing at the same time.

ABC Specialty Wear is the only company that has written permission to use a national football team's logo on its sportswear. This is an example of a A. licensing agreement. B. sole proprietorship. C. product trade-name contract. D. limited joint-venture contract.

A. licensing agreement. ABC Specialty Wear's agreement with the football team is a licensing agreement. Licensing refers to an owner's authorization for another entity to use trademarked, copyrighted, or patented material for a specific activity, during a specific time period, for the profit of both parties. Product trade-name (also called dealership or exclusive distributorship) refers to a franchise arrangement based on an independent sales relationship between a franchisor and franchisee to stock and sell a specific line of goods. A sole proprietorship is a business that is owned by one person. A joint venture is an arrangement that involves two or more businesses combining complementary resources for the benefit of all parties.

Which one of the following groups of words best describes wants? A) Limited, changing, and compensating B) Unlimited, changing, and competing C) Limited, unchanging, and competing D) Unlimited, unchanging, and compensating

B) Unlimited, changing, and competing Wants are considered unlimited because people always have them. People's desires change with different situations or circumstances. Wants are considered competing because people must choose which wants to satisfy at any one time.

In economics, the term capital goods includes... A) labor and management. B) buildings and equipment. C) mental and physical work. D) trees and water.

B) buildings and equipment. Capital goods include all materials used in the production of goods and services. In fact, any manufactured or constructed item that is used to produce goods and services is considered a capital good. Labor and management are considered human resources. Mental and physical work are the types of work done by human resources. Trees and water are examples of natural resources.

A gap between unlimited wants and limited resources creates a condition known as... A) economics. B) scarcity. C) wants. D) resources.

B) scarcity. Scarcity. Scarcity occurs when there are not enough resources to meet people's wants. Resources are considered limited because there are not enough of them so that everyone can have as much of them as they wish. Economics is the study of how to meet unlimited, competing wants with limited resources.

If a good or service is scarce, consumers will usually be... A) unwilling to buy it. B) willing to pay money to get it. C) uninterested in owning it. D) able to get as much of as they want.

B) willing to pay money to get it. A good or service is considered scarce when not everyone can have as much of it as desired. This makes consumers willing to pay for the item to obtain it. Since scarce items may be hard to locate, consumers may be more interested in owning them and willing to buy them.

Which of the following is a reason that wants are unlimited? A. People are always able to obtain enough resources to satisfy all of their wants. B. People are never able to obtain enough resources to satisfy all of their wants C. People's desires change with different situations or circumstances. D. The ultimate goal of all economic activity is consumption.

B. People are never able to obtain enough resources to satisfy all of their wants

Which of the following economic resources is responsible for combining the other resources to produce goods and services? A) Natural resources B) Capital goods C) Human resources D) Nonrenewable resources

C) Human resources Human resources, which are often considered to be the most economic resource, are responsible for combining natural resources and capital goods to produce goods and services. Human resources are required, to some extent, in the production of all goods and services. Nonrenewable resources are a type of natural resource.

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 products will be produced

C) What products will be produced; how will products be produced; and how will products be allocated These are questions which all economies must answer. Societies must determine what and how many goods and services to produce. They must determine the best, most efficient ways of producing goods and services, and they must decide how the goods and services will be divided among the members of their societies.

What determines whether an economic product is an industrial product or a consumer product? A) Who produces the product B) The origin of the project C) Who buys and uses the product D) The price of the product

C) Who buys and uses the product Industrial products are purchased by producers for resale, to use in making other goods and services, or for use in their operations. Consumer goods and services are purchased and used by the ultimate consumer. Price, origin, and producer have no bearing on whether a product is a consumer or an industrial item.

Wendy's sells the right to operate its restaurants to individuals who meet the company's criteria. The arrangement between Wendy's and these individuals is an example of... A) a partnership agreement. B) licensing. C) franchising. D) multi-level marketing.

C) franchising. Franchising is a method of distributing goods and services through a licensing arrangement between the franchisor and the franchisee. Multi-level marketing businesses pay commissions to sales representatives at two or more levels. Licensing refers to an owner's authorization for another entity to use trademarked, copyrighted, or patented material for a specific activity, during a specific time period, for the profit of both parties. A partnership agreement is a written document that specifies the terms of a partnership.

Where a product is available for purchase is referred to as... A) the right location. B) the setting. C) place utility. D) product display.

C) place utility. Place utility is the usefulness provided by where a product is available for purchase. The right location offers the best place utility, of course. The setting is the selling environment, in general. And, to showcase a product for sale, marketers may use a product display.

Task utility is about making changes to the characteristics of a... A) job. B) project. C) service. D) good.

C) service. Task utility is about making changes to the characteristics of a service. Changing a good's form is form utility. A job or a project may be referred to as a "task" in another sense of the term.

Two factors involved in determining the value of a resource, good, or service are A. demand and desires. B. availability and trade-offs C. availability and demand D. productivity and opportunity costs.

C. availability and demand Resources, goods, and services that are abundant are usually less highly valued than scarce resources, goods, and services. As people's desires, or demands, for resources, goods, and services increase, so do the money payments they will be willing to make. Another factor which affects the value of a resource, good, or service is productivity.

Using a stream to supply water to a field in order to grow crops is an example of using... A) nonrenewable resources. B) capital goods. C) human resources. D) natural resources.

D) natural resources. Natural resources are found in nature and are used to produce goods and services. Human resources are the people who work to produce goods or services. Capital goods are all manufactured or constructed items that are used to produce goods or services. Nonrenewable resources are natural resources that may become entirely depleted. Nonrenewable resources cannot be replenished after use. Water is not a nonrenewable resource.

John, Robert, and Charles were college friends who wanted to start a business. John has creative ability, Robert's expertise is selling, and Charles' expertise is management. However, each has limited capital. The ideal business ownership for these young men is a... A) merger. B) franchise. C) corporation. D) partnership.

D) partnership. A partnership is a form of business ownership in which the business is owned by two or more persons. Often, the purpose of forming a partnership is to combine the capital, the experience, and the abilities of the partners. A corporation is a form of business ownership owned by stockholders who have purchased stock. A franchise is an agreement between a parent company and a franchisee to distribute goods and services. A merger is the absorption of one company by another.

To provide utility, a product must be... A) innovative. B) economical. C) appealing. D) useful.

D) useful. To provide utility, a product must be useful. It can be innovative, economical, and appealing—but it must be useful.

To discover a product's level of utility, marketers measure the consumer's A. desire. B. perspective. C. attitude. D. satisfaction.

D. satisfaction. To discover a product's level of utility, marketers measure the consumer's satisfaction. The consumer's perspective, attitude, or desire may affect his/her purchase decision—but marketers measure the satisfaction actually received.

John only had $40 to spend and couldn't decide whether to buy a new pair of jeans or to go to an amusement park. He finally decided to spend his money on the amusement park. What was the opportunity cost of his decision? a. New pair of jeans b. $40 c. Trip to amusement park d. No opportunity cost was involved.

a. New pair of jeans When a choice is made about the best use of resources, the alternative that is given up is called the opportunity cost. In this case, John decided to spend his money on a trip to an amusement park, rather than on a new pair of jeans. Since the pair of jeans was given up, it is the opportunity cost. Opportunity costs exist because of scarcity.

The ultimate goal of all economic activity is a. consumption. b. production. c. exchange. d. distribution.

a. consumption. The ultimate goal of all economic activity is consumption, which is the economic process or activity of using goods and services. For consumption to occur, goods and services must be produced, or made. Producers, consumers, and resource owners exchange money payments for the use of their goods, services, and resources. Distribution examines how money payments are divided between producers and resource owners.

When a stove is used in a restaurant kitchen, it is a a. noneconomic resource. b. natural resource. c. human resource. d. capital good.

d. capital good. Capital goods help people to be more productive. In other words, capital goods help human resources to do more in less time than they could do without tools, machinery, roads, etc. People—also known as human resources—create and use capital goods to transform natural resources from their less satisfactory original state to products that better satisfy consumers. Natural resources, human resources, and capital goods are all economic resources.

Changing a good's form involves which of the following: a. Getting the good to the retailer b. Adding a new feature to the good c. Making sure the good is available early d. Providing an easy way to buy the good

b. Adding a new feature to the good Changing a good's form involves adding a new feature to the good. Getting the good to the retailer is part of place utility. Making sure the good is available early is part of time utility. And, providing an easy way to buy the good is part of possession utility.

Into what two categories can wants be divided? a. Unlimited and limited b. Unlimited and economics c. Economic and noneconomic d. Unlimited and noneconomic

c. Economic and noneconomic Economic wants have monetary values attached to them, while noneconomic wants are free. Economics is concerned with economic wants. Wants are considered unlimited because everyone has them, they change, and people are not able to obtain enough resources to satisfy all of their wants. Limited wants do not exist.

Retailing takes place whenever goods are a. offered for sale. b. exchanged for other goods. c. sold to the ultimate consumer. d. sold in a retail establishment.

c. sold to the ultimate consumer. Retailing is not simply the exchange of goods or offering goods for sale. Retailing occurs only when goods are sold to those who will use them, and it may occur in the consumer's home, over the telephone, or in a variety of ways other than in a retail establishment.