DECA Econ Exam
How to calculate Markup
$4 to manufacture, with an 80% markup...4*(100%+80%) manufacture price*(100%+markup%)
Which of the following is used by the United States to decrease its trade deficit:
. Promoting U.S. tourism to foreign countries NOT using a greater variety of quotas
Recession
6 months of crappiness
Sole Propreitorship
A business owned by one person unlimited liability
Type of Product: Convenience
A convenience good is one that requires a minimum amount of effort on the part of the consumer goal is to sell it to wholesalers
Joint Venture
A joint venture (JV) is a business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task.
Liscensing
A licensing agreement is a legal contract between two parties, known as the licensor and the licensee. In a typical licensing agreement, the licensor grants the licensee the right to produce and sell goods, apply a brand name or trademark, or use patented technology owned by the licensor.
What increases the demand for money?
A reduction in interest rates
General Partnership
All individuals who own a business share unlimited liability
The effect of relative prices on people's decisions to buy helps our market economy to
Answer the basic economic questions
Type of Product: Industrial
Are made up of Capital goods, materials and parts, supplies, and business services
Law of Demand
As price goes up, demand goes down
Law of Supply
As price goes up, supply goes up
primary responsibility of a national union
Assist in contract negotiations, not elect local leaders in these negotiations
What does a country's government primarily attempt to achieve with its fiscal policy?
Balance in exercising influence, NOT decrease in economic recessions
Enterprise
Big branch...there are LLC, sole proprietorship, corporation, etc under this umbrella
John is a recent college graduate with very little experience in operating a business, but he wants to own a business that has a well-known trade name. If he has sufficient capital to invest, what type of business ownership should he consider? Business Format Franchise or General Partnership?
Business Format Frachise
Private Enterpirses
Business owned by someone not connected to the government. Sell what they want when and where they want with minimal govt intervention
Societies must decide how to allocate their scarce resources between the production of
Capital and consumer goods, not foreign and domestic goods
Corporation
Company that is registered by the state and operates apart from its owners the owners must get a corporate charter from the state where their main office will be located. limited liability holds a firm's owners responsible for no more than the capital that they have invested in it
Which of the following factors characterizes the growth phase of business cycles:
Consumers and producers are borrowing more money. NOT Demand for resources exceeds their availability.
in a market economy, the products that will be produced and sold are determined by the
Consumers' economic votes not profit motive
Which of the following should businesses consider when making decisions about global trade:
Cultural symbols, not export taxes
Bilateral Contract
Cusomter signing a contract with a business agreeing to pay a certain price
Type of Product: Shopping
Customers usually research it Goods that consumers want to be able to compare, such as automobiles, appliances, and homes,are categorized as shopping goods.
When countries depend upon each other for products they cannot produce alone?
Economic interdependence, not a trade surplus
The overall category of resources that makes it possible for businesses to produce the goods and services that consumers want to buy is __________ resources
Economic, not Capital resources
Jason has been operating a corner gas station for 10 years, but the traffic to his business has decreased 80% over the past year because all the surrounding businesses have closed. This is an example of __________ business risks.
Economic, not natural
Capital Good resource
Eg-Office Equipment, not computer operator
Some businesses try to decrease expenses and increase profits in the customer-service area by
Eliminating Free Services, not improving service quality
Which of the following is an economic condition that affects consumer spending
Employment, not Competition
The government agency that regulates the advertising industry is the
Federal Trade Commission (not Consumer Product Safety Commission)
When a producer changes from an expensive resource to one that is less expensive, this is an example of
Finding an alternative resource, not finding another source
What type of government policy involves raising or lowering taxes, and increasing or decreasing government spending
Fiscal
Pegged currency is also known as
Fixes, not weak
Which of the following actions illustrates the strong leadership needed in an adaptable organization:
Focusing on maximizing resources, not looking at the big picture rather than individual employees
Patent
For an invention Encourage new ideas
Type of Product: Specialty
From the consumer's perspective, these products are so unique that they will go to any lengths to seek out and purchase them. Almost without exception, price is not a principle factor affecting the sales of specialty goods statues, hairpieces
Copyright
Given to authors
Globalization=
Higher Productivity not increased consumer spending
Which of the following factors would decrease demand for a country's free-floating currency?
Increased political unrest, not increased imports
to curb the effects of ___which accompany recession, the gov't should decrease interest rates
Inflation, not deflation
How does technology affect customers?
It influences what they want and need
The unemployment rate is a(n) __________ indicator.
Lagging, not Leading
What type of business usually experiences economies of scale due to expanded operations?
Large manufacturing plant
A clothing manufacturer in the United States allows a company in Argentina to use its name and logo in exchange for a fee and royalties. This is an example of
Liscensing
Fiscal policy vs Monetary Policy
Monetary policy involves changing the interest rate and influencing the money supply. Fiscal policy involves the government changing tax rates and levels of government spending to influence aggregate demand in the economy.
Why is it important for a business's budget to be well planned?
Money is limited, not time is valuable
A public Utility company that is regulated by government is an example of a____
Natural monopoly, not a watchdog agency
According to U.S. monetary policy, which of the following is a liability that must have a reserve against it:
Net Transactions Account not credit Extension
Cooperative
Owned and operated by its member
Close Corporation
Owned by a few and does not offer shares to the public
Making required textbooks available at a campus bookstore is an example of creating __________ utility.
Place, not Posession
Antitrust laws are created to keep competition fair. Which of the following external factors are these laws a part of:
Political, not Economic
In Hofstede's dimensions of national cultures, a country's acceptance of inequality is measured by its score in
Power distance
Two major type of competition used by businesses are
Price and Non Price, not Features and benefits
Product Trade Name/Franchise
Product or trade name franchising (product franchise) is the simplest form of franchising. In this franchise relationship, the franchisor owns the right to the name or trademark, and sells that right to a franchisee. Franchisee can choose the name of the business, not that they have unlimited liability
In a market economy, which of the following factors has an influence on what goods are produced:
Profit, not Need
Gary believes that the upper class should pay a higher income tax rate than the middle and lower classes. What tax structure does Gary favor?
Progressive, not Proporational
Function of Relative Prices
Rationing Incentives Information Production is NOT one of them
Function of the Fed Res. is to
Regulate the domestic money supply
Which of the following is a tool the U.S. Federal Reserve can use to formulate monetary policy
Reserve Requirements, not tariffs remember, monetary interest rates and money supply vs fiscal which is taxes
Marginal Revenue
Revenue per product
S Corporation
S. What makes the S corp different from a traditional corporation (C corp) is that profits and losses can pass through to your personal tax return
Which type of resource would most likely encourage a company to do business with a foreign firm?
Scarce, not abundant
Why is the productivity of service businesses measured differently than that of manufacturing businesses?
Service businesses are concerned about the appropriateness of their products, not that they are less efficient
Economies of scale is an economic concept that involves the __________ of a production facility.
Size, not value
The government owns part of the means of production but there is private ownership of business, as well, in a __________ economic system.
Socialist Command Not capitalist
Form
Something being made usable oil turned to gas
Which of the following is a legal concept that affects businesses that operate in foreign countries
Sovereign immunity, Generally, the idea that the sovereign or government is immune from lawsuits or other legal actions except when it consents to them.
What is the effect on society of a falling growth rate in productivity?
Standard of living drops, not increased labor disputes may occur
Economic Resources
The Broad Category that encompasses capital, human, and natural
Posession
The granting of credit helps create possession, not exchange how will a customer use it
Socialist Command
The state owns and controls most of the factors of production, including land and capital goods. The state also engages in central planning. Production of goods and services, as well as their prices and distribution, are centrally controlled by the state.
Economics
The study of how to meet unlimited competing wants with limited resources
Which of the following is a reason that depository institutions would borrow money from a Federal Reserve Bank
They are short on cash reserves due to unexpected credit demands. NOT: They are short on cash reserves due to the Fed's discount window loans.
Which of the following is a reason a company might organize itself under the laws of a different country than those of its "home" country:
To save on Taxes
The classical theory of unemployment states that unemployment begins when
Wages rise too high, not when demand goes down
Product
What to sell
Partnership
a business owned by two or more people who share the risks and rewards need a partnership agreement
Consumer spending to likely to decrease when
a federal-income tax increase is implemented.
Oligopoly
a state of limited competition, in which a market is shared by a small number of producers or sellers.
Natural Resources
are something from nature that people can use, such as trees, land, water, animals, and minerals, etc...
Economies of scale
characteristics that allow a business to increase output without experiencing a comparable increase in the cost of production
Why would multi national corporation give freedom to local managers in handling labor relations problems?
countries have unique labor relations traditions,
Business Format Franchise
eg- mcdonalds, starbucks, KFC It is a form of service agreement whereby the franchisee provides the management expertise, format and/or procedure for conducting the business
during times of war we make more guns, which results in an ____ of econ activities
expansion
GDP considers
federal state and local
sales tax increasing is a change in
fiscal, not monetary policy
Exchange rate between USD and Canadian dollars is a ___ exchange rate
floating exchange rate
Communist
government makes the decisions
subsidies
govt giving money to business so price can remain competitive
Time
having it available when someone demands it
Limited Liability Company (LLC)
holding a firm's owners responsible for no more than the capital that they have invested in it
Promotion
how will others hear about it
Price
in reference to competitors, what to charge for it
Capital Resources
include money to start a new business, tools, buildings, machinery, and any other goods people make to produce goods and provide services.
To increase economic growth, gov't would....
increase govt spending not decrease government subsidies
Demand for money decreases when
interest rates increase
demand for money will rise when
investment transaction costs increase NOT when businesses purchase more government bonds
Market
no government rule, businesses make all the decisions
Why are products from Canada or Mexico less expensive than before NAFTA
no longer have tariffs
Trademark
protecting intellectual property symbol, word, or words legally registered or established by use as representing a company or product
to avoid a trade deficit a country follows ___policy
protectionism, not speculation
Responsibility of the Fed Res is
regulate financial instiutions
Which has influenced the geographical development of unions
right to work laws not right to bargain collevtively
Gross profit
sales price-unit cost
Place
store and location in store have it where a customer would want it clothes and boots available at a ski shop
Labor unions are to...
strengthen bargaining power
Traditional
subsistence
Human Resources
the people needed to grow or make and sell a product or service.
