The Business Environment- Questions
Social responsibility should be part of the objectives of __________ businesses.
all
Maintenance, modifications, and use of alternative sources are responses to limited
capital goods.
When a stove is used in a restaurant kitchen, it is a
capital good.
A student purchased a laptop to use for homework assignments. In economic terms, this computer would be classified as a(n) __________ good.
consumer
Businesses in trade industries that offer discount prices usually offer
limited services.
Friendship would be considered a(n) __________ want.
noneconomic
Retailing takes place whenever goods are
sold to the ultimate consumer.
How would a business's computers be classified?
As equipment
Which of the following economic resources helps people to be more productive:
Capital goods
Which of the following is an example of an economic want:
Clothing
What exists when producers produce more than buyers are willing and able to buy?
Excess supply
Which of the following economic resources is responsible for combining the other resources to produce goods and services:
Human resources
What usually happens to the demand for a good or service when the price increases?
It decreases.
"Economic votes" are cast by consumers each time they
make a purchase.
A characteristic of human wants is that they are
unlimited.
Which of the following factors may influence supply:
Government regulations
Which of the following situations involves finding an alternative resource to use in place of a nonrenewable natural resource:
Powering a motor vehicle with biodiesel instead of gasoline
What determines whether an economic product is an industrial product or a consumer product?
Who buys and uses the product
Who gets the goods and services produced in our economy?
Whoever is willing and able to pay the price
Bread for a family would best be classified as a(n) __________ product.
convenience
Using a stream to supply water for crops is an example of using
natural resources.
Weather conditions can most directly affect the supply of
natural resources.
A business that produces a product should be socially responsible to the __________ product.
users
How much a consumer is willing to pay for a product depends partly on the consumer's opinion of the product's
value.
Emilia works for a company that constructs houses and business facilities. Which type of producer does she work for?
A builder
Which of the following statements about economic resources is true:
As natural and human resources become limited, capital goods become limited.
Which of the following is characteristic of a seller's market:
High prices
Which of the following occurs when the supply of individuals who are able and willing to work diminishes:
Human resources become limited.
What do producers often do when supply is greater than demand?
Lower prices
Which of the following describes inelastic demand:
Not affected by price change
What is the amount of money for which an item sells in the competitive marketplace?
Price
Which of the following is an example of a change in the relative price ratio when the original price of red apples is 60¢ per pound and the original price of green apples is 80¢ per pound:
Red apples @ 90¢ per pound; green apples @ 80¢ per pound
An example of a noneconomic want would be the desire for
a friend.
Demand for a good is more likely to be elastic when the good is
a luxury.
One way in which many businesses demonstrate their social responsibility toward employees is by providing them with
a safe working environment.
When supply is greater than demand, a __________ often develops.
buyer's market
Automation involves replacing human resources with
capital goods.
Marcy is ready to buy a new computer, and she has saved up enough money to buy the model she wants. This is an example of
demand.
Seeing a movie at a theatre would be considered a(n) __________ want.
economic
When less expensive substitutes for a product are readily available, then demand for that product is likely to be more
elastic.
Each day, a restaurant sends its used linens to a laundry to be cleaned and pressed. In economic terms, the laundry service would be classified as a(n) __________ service.
industrial
A producer is someone who
makes things.
Cash-register tapes and shipping forms used by a business would be classified as industrial
supplies.
Which of the following is a factor affecting a product's utility to the individual customer:
Consumer's age
How are prices used in our economy?
To ration limited resources
Which of the following is a business comparing when it analyzes the cost of buying wood desks versus the cost of buying metal desks:
Relative price
A car manufacturer receives a shipment of bolts that are going to be used in the production of automobiles. What type of industrial product would the bolts be?
Parts
Which of the following statements regarding economic resources is true:
Natural resources, human resources, and capital goods are often referred to as factors of production.
Rather than being required to start his workday at 8:00 a.m. and end at 4:00 p.m., Tyler is allowed to start and end his workday at his convenience as long as he works 40 hours per week. This is an example of
flextime.
After a mild, dry winter, the supply of sleds should be __________ than demanded. Therefore, the price would be __________.
greater; decreased
The connection between the social responsibility of a business and the community in which the business operates is that the business's social responsibility __________ the community.
has an effect on
A salesclerk working part-time at a clothing store is an example of a(n)
human resource.
Offering higher wages, employee-assistance programs, and benefits are responses to limited
human resources.
An economic good or service that is scarce is one that is
in limited supply.
Producers respond to consumers' positive economic votes by
increasing production.
Resources that enable businesses to operate are also known as
inputs.
To be able to charge competitive prices in our economy, producers must combine resources and technologies to produce
items at the lowest cost possible.
When there is not enough of a resource available for everyone to have as much of it as desired, the resource is
limited.
A company that transforms cotton into wearable clothing is considered a
manufacturer.
Excess demand and excess supply cause changes in
market price.
One way in which a business can show its social responsibility is by __________ its profits.
maximizing
The state of technology that exists in a society can limit
natural resources and capital goods.
Water and air are examples of __________ resources, while people are considered to be __________ resources.
natural; human
Any factor that causes changes in supply and demand will cause changes in
price.
A team of employees is responsible for researching potential demand for a business's brand- new product. The factor that is most likely to affect demand for this product is the
product's utility.
Businesses can show their social responsibility by contributing to
public interests.
Farms, mines, and lumber companies are examples of
raw-goods producers.
When demand is greater than supply, a __________ often develops.
seller's market
Susan is willing to pay a high price for the brand of china that she wants for her home. This china would be classified as a(n) __________ product.
specialty
People often buy goods and services in order to maintain the quality of life and general living conditions to which they are accustomed. This influence on demand is referred to as
standard of living.
Some energy companies offer free electricity at night and on weekends because during those times
supply is greater than demand.
The price of complementary products has an effect on
supply.
The quantity of a good or service that producers are able and willing to offer for sale at a specified price in a given period of time is
supply.
When the price of Bluetooth speakers increases, the quantity of Bluetooth speakers offered for sale will increase. This is an example of the law of
supply.
One reason why the supply of certain products has been eliminated is because of
technology.
A socially responsible business will attempt to give customers
the best products at the best prices.
Excess demand is eliminated when the selling price reaches the point at which consumers are willing to buy __________ producers have to sell.
the same quantities that
When producers use the best combination of resources, consumers are more likely to get goods and services that
they want.
The two main divisions of the trade industry are
wholesalers and retailers.
If a good or service is scarce, consumers will usually be
willing to pay money to get it.
Over the next few years, members of Generation X and Generation Y are expected to fill many job positions vacated by retiring Baby Boomers. This is an example of a change in
workforce demographics.
Which of the following is a characteristic of economic services:
Useful
Prices set higher than the equilibrium price will result in
excess supply.
Sugar and flour that are purchased to make baked goods are classified as
materials
A large retailer feels that it has a duty to contribute to the well-being of society, so it donates a portion of its proceeds to a charity that helps the environment. The retailer is demonstrating
social responsibility..
Rembert works for a grocery store that buys food from producers and sells it to customers. The grocery store is considered a
trade industry.
Determine whether the following statement is true or false: Trade industries all have the same form of ownership.
False; they may be independent or belong to a chain.
A store sells T-shirts for $10. Which of the following would be the most likely to occur if all other factors remain the same, and there is a demand for the T-shirts at $10:
If the price is lowered, the volume of sales will go up.
Even though gasoline prices increased 15 cents per gallon as the result of the new gas tax, Alice continued to buy gas so that she could make her 20-mile drive to work. This is an example of what type of demand?
Inelastic
What do service businesses sell?
Intangible activities
What might businesses do if they expect prices to increase substantially in the future?
Keep products off the market
Jeremy has $15,000 to spend on a new car. He found a car that cost $14,500, but he did not think the car was worth more than $12,000. The dealer told Jeremy that he has not been able to sell this model because other customers have expressed the same opinion as Jeremy. Does demand for this car exist?
No, because consumers are not willing to pay the price being asked for this car.
For 20 years, Don owned a small grocery store. When several big box stores that sell groceries at discounted prices moved into the area, Don's sales declined, and he had to close his business. Which of the factors that affect supply affected Don's business?
Number of producers
What are the incentives in our economy that encourage producers to change and reallocate their resources?
Profits
Which of the following situations involves finding another source of a limited natural resource:
Searching for oil on the ocean floor
George has decided to purchase a dishwasher. He is checking the newspaper ads for the best place to get quality goods and services at a reasonable price. What type of product is the dishwasher?
Shopping
Which of the following is an example of the substitution effect:
The price of laptops went up recently, so Francis decided to buy a tablet instead.
Your business is selling more and more large-screen televisions each month. Applying the law of supply and demand, what do you expect to happen to the price and supply of these televisions over the next few months?
The price will increase, and supply will increase.
Which of the following describes the services offered by trade industries:
They may be limited or full line.
Which of the following statements about wholesale trade businesses is true:
They operate from a variety of business premises.
How do producers answer the economic question of what to produce in a market economy?
They produce products that are the most profitable.
Which of the following is an industrial good:
Tires for a tow truck
Why do marketers classify goods and services?
To aid in marketing planning
Which of the following groups of words best describes wants:
Unlimited, changing, and competing
Most businesses strive to supply goods and services in direct proportion to
demand.
Orlando changes the price of one of his products, and this price change leads to a major change in the number of people who purchase the product. This means that demand for Orlando's product is
elastic.
Marc wants to figure out how much changes in price will affect his business's sales, so he pays attention to
elasticity.
What do consumers, producers, and resource owners need to have in order to make economic decisions?
Information about prices
A local neighborhood has many houses for sale at a low price, but demand for the houses is low. What kind of market most likely exists in the neighborhood?
Buyer's
What is one factor that will determine how much a customer is willing to pay for a good or service?
Buying power
Which of the following determines whether consumers can purchase goods or services:
Buying power
Your firm is considering producing a new product. Research shows that there is definitely a demand for the product and that there are currently only two other producers of this product. Which of the following might prevent your firm from producing this product:
Cost of production
Into what two categories can wants be divided?
Economic and noneconomic