Chapter 2 Intro to Business

if you were going to start a small cake decorating business, which type of market structure would you most likely be entering a. perfect competition b. monopolistic competition c. oligopoly d. monopoly

B

what determines the type of economic system a country has a. political beliefs of the country's ruler b. the way the basic economic questions are answered c. the resources of the country d. the demands of the people

B

which of the following is NOT an example of a service a. lawn care b. car wash c. bicycle d. cable tv installation

bicycle

economics is about making ________ and _________ the needs and wants of consumers

choices; satisfying

mixed economy

combines elements of the command and market economies

what are the four major market structures

competition, monopolistic competition, oligopoly, monopoly

variable costs

costs that go up and down depending on the quantity of the good or service produced

An example of a noneconomic want is a. clothing b. housing c. friendship d. cars

friendship

what are the three basic economic questions countries must answer

how, what, and for whom

marginal benefit

measures the advantages of producing one additional unit of a good or service

marginal costs

measures the disadvantages of producing one additional unit of a good or service

What three kinds of economic resources are used by entrepreneurs to produces goods and services

natural resources, Human Resources, and capital resources

scarcity

occurs when people's needs and wants are unlimited and resources are limited

capitalism

private ownership of resources by individuals

functions of businesses

production, marketing, management, and finance

supply

quantity of a good or service a producer is willing to produce at different prices

traditional economies

simple economies operated according to tradition or custom

economic resources

the means through which goods and services are produced

equilibrium price and quantity

the point at which supply and demand meet

economic decision making

the process of choosing which wants you will satisfy using resources you have

demand

the quantity of a good or service consumers will buy at a given price

opportunity cost

the value of the next-best alternative -- one you must pass up

wants

things that you think you must have in order to be satisfied

monopoly

when there is only one provider of a good or service

oligopoly

a small number of businesses that gain the majority of total sales revenues

another name for economic resources is a. factors of production b. goods and services c. supply and demand d. command economy

A

the ford motor company operates in which type of market structure a. perfect competition b. monopolistic competition c. oligopoly d. monopoly

C

the four basic principles of the U.S. economic system are a. private property, freedom of choice, loss, competition b. taxed property, freedom of choice, profit, competition c. private property, freedom of choice, profit, competition d. private property, limited choice, profit, competition

C

which of the following is NOT a function of business a. production b. marketing c. job creation d. finance

C

which of the following is NOT a role of entrepreneurs in the U.S. economy a. supply goods and services to meet consumer needs and wants b. provide capita investment and job creation c. determine how to allocate natural resources d. serve as agents for change

C

if a product has inelastic demand, a price increase will cause a. consumers to buy more b. competitors to enter the market c. consumers to buy less d. little or no change in the demand for the item

D