Business Exam Review (Set 2)

Levels of inflation and unemployment are factors that affect __________ in the world market.

competition

A country with a weak currency value tends to

decrease its imports and increase its exports

Changes in the market that cause prices to go up or down, products to change, and businesses to succeed or fail are examples of ________ risks.

economic risks

A popular product is said to be

in demand

Which of the following government actions is most likely to stimulate the economy? a. lowering tax rates b. raising the prime interest rate c. printing less money d. borrowing more money

lowering tax rates

Which of the following is a disadvantage of private enterprise: a. periods of unemployment b. elimination of poverty c. careful use of resources d. equal distribution of income

periods of unemployment

Alex owns a guitar, several books, a car, and a telescope. Alex's possessions are examples of

private property

If expenses are greater than income, there's no

reward

Online chats, forums, and communities that enable businesses to learn about the wants and needs of their worldwide target market have created a new form of

social relationships

Gross profit shows business owners the difference between what they've

spent and received

Why are entrepreneurs important in a private enterprise system?

they encourage the development of new products

Each purchase strengthens the economy by encouraging

trade

A nation that exports more than it imports maintains a

trade surplus

Contractual agreements such as guarantees, surety bonds, and leases are examples of handling business risks through

transfer

What is the government doing when it buys wheat to keep the price high enough for farmers to make a profit?

using price supports

One of the freedoms provided to individuals by the private enterprise system is the freedom to choose

where they will work

The U.S. produces widgets faster and cheaper than Switzerland. In this example, the U.S. has a(n) ___________ advantage.

absolute

One way that competition helps to build a prosperous society is by

creating new jobs

Why does government set and collect taxes?

To help pay the expenses of government

Which of the following is a benefit of international trade: a. an improved standard of living b. higher prices for goods and services c. stronger trade restrictions d. an increased trade deficit

an improved standard of living

Management decides to hold its annual meeting in one U.S. city rather than another because of crime in that city. This is an example of _________ the risk.

avoiding

Carefully selecting goods or services to sell is an example of handling business risks by _______________ the risk.

controlling

Which of the following is a potential problem in market economies? a. product quotas for businesses b. total government control c. no competition d. financial loss

financial loss

Which of the following are qualities of monopolies: a. high prices and much competition b. low production and much competition c. high prices and low production d. low prices and little competition

high prices and low production

Businesses can protect themselves from the risk associated with lost shipments by

purchasing transportation insurance

Government can prevent unqualified persons from operating a business by: a. refusing to grant a license b. closing their bank accounts c. raising their taxes d. helping their competitors

refusing to grant them a license

Most businesses put their greatest competitive efforts into competing

with direct competitors

Offering high quality, large assortments, and free shipping are examples of

Non price competition

Which of the following is an example of nonverbal communication that might have a different meaning to business people in other parts of the world: a. inviting customers to a social function b. shaking hands when greeting a customer c. writing letters in a foreign language d. preparing an audio visual presentation

Shaking hands when greeting a customer

Which of the following is a public good that is provided by the government: a. interstate highways b. private schools c. new automobiles d. marketing research

Interstate highways

Which of the following is a situation that might make business people from other countries feel uncomfortable and impact their ability to conduct business: a. offer to take to lunch or dinner b. calling in advance to schedule appointments c. standing very close to others during conversation d. wearing business type clothing that is conservative

Standing close to others during a conversation

Which activities are likely included to increase a firm's profit? a. Increasing supplies and decreasing production b. increasing sales and decreasing expenses c. decreasing sales and increasing expenses d. decreasing supplies and increasing production

increasing sales and decreasing expenses

Private enterprise is based on the idea that everyone is better served when

individuals are free to set their own goals

One way that competition benefits business is by encouraging the creation of

new companies