Chapter 1 Assignment: Exploring the World of Business and Economics

In 2020, retailer JCPenney was forced to file bankruptcy because it experienced a negative profit caused by the COVID-19 pandemic. This negative profit is referred to as which of the following?

A loss

General Motors Corporation plans to offer 30 new electric vehicle models globally by 2025. It remains to be determined whether consumers will embrace (in other words, purchase) electric vehicles to the extent required by the company's plan. General Motors' decision to commit to electric vehicle technology, despite the risk, is an example of which of the following economic systems?

A market economy

Target buys products from manufacturers and then resells them to consumers. As such, Target is which of the following?

A marketing intermediary

Manu, a student enrolled in an undergraduate economics class, has studied the various types of economic systems. He has concluded that the best type of economic system is one that encourages private enterprise, subject to regulation by the government. He also believes that certain services, such as social security and health care benefits, should be managed by the government. Manu supports which of the following types of economic systems?

A mixed economy

Imasu plans to become a licensed realtor and open his own real estate sales office in his hometown of Petaluma, California. What type of business will Imasu be operating?

A service business

Google is an American multinational technology company that incorporates a workplace system that recognizes and respects the differences among people because of their age, race, ethnicity, gender, sexual orientation, and ability. Which of the following terms refers to the system that Google uses?

Cultural diversity

Suppose that as chief executive officer of the United States Chamber of Commerce, Suzanne Clark is very concerned that due to economic turbulence in the United States, product prices in various industries will decrease due to the lack of consumer willingness and/or ability to pay currently existing prices. Mrs. Clark is concerned about which of the following?

Deflation

Sophie is a tattoo artist who operates a small tattoo shop in the Bronx, New York City. There are dozens of tattoo shops in New York City, and Sophie would like to attract more customers. What should she do?

Differentiate her services from the services provided by her competitors

Which of the following is correct regarding a recession?

During a recession, it is typical for consumer buying power to decrease.

Suppose that in an attempt to stimulate the economy, the Federal Reserve Board chooses to cut corporate tax rates. This action is an example of which of the following?

Fiscal policy

Suppose that to be more competitive with General Motors Corporation (GMC) in the United States market, Ford Motor Company decides to lower its automobile prices across its product line. Which of the following will likely occur?

General Motors Corporation will lower its automobile prices across its product line.

In 2020, the total dollar value of all goods and services produced by all people within the boundaries of the United States was $20.9 trillion. Which of the following does this statistic measure?

Gross domestic product

As a retiree living on a fixed income (primarily Social Security benefits), Marlon is very concerned that after the height of the COVID-19 pandemic, grocery store prices are rising significantly. Marlon is concerned about which of the following?

Inflation

In its latest social responsibility report, General Mills describes how it contributed more than $93 million in 2019 to a wide variety of charitable causes, including support for programs that feed the hungry and nonprofit organizations, schools, and communities across the globe. This is an example of General Mills' attempt to satisfy its obligations to which of the following?

Its stakeholders

Suppose that the Federal Reserve Board chooses to increase interest rates to reduce the possibility of inflation in the overall economy. This action is an example of which of the following?

Monetary policy

Levi Strauss & Co. is a venerable American clothing company known worldwide for its Levi's brand of denim jeans. It was founded in May 1853 when German immigrant Levi Strauss moved from Buttenheim, Bavaria to San Francisco, California to open a west coast branch of his brother's New York dry goods business. Levi's jeans are known for both their brand and their durability, and as a result, Levi Strauss & Co. can command a higher price than many of the other numerous jean manufacturers globally. What type of competition does Levi Strauss & Co. face in selling the jeans it produces?

Monopolistic competition

Joel is a farmer in Eastern Idaho. His small farm has been in his family for five generations and produces primarily the potatoes that have made Idaho famous for its agricultural capabilities. When Joel sells his potatoes to an agricultural wholesaler, market forces dictate that he accept the market rate for his crop. In other words, Joel cannot expect to receive a higher price for his potatoes that the market rate. What type of competition does Joel face in owning and operating his small potato farm?

Perfect competition

During her annual performance evaluation, Maira's supervisor Camille expressed that she was very pleased that Maira's output per hour had improved by 17 percent compared to the previous year. Based on her comment, Camille was encouraged with Maira's improvement in which of the following?

Productivity

Chloe, a young entrepreneur, plans to open a small textile manufacturing company in Asheville, North Carolina. They plan to hire 20-25 employees. Which manufacturing technique should Chloe use in their textile business for productivity?

Specialization

Suppose that Ford Motor Company decides to shut down entirely its domestic automobile production in the United States and move its operations to other countries. All the individuals in the United States who would be negatively impacted by such a decision are referred to as which of the following?

Stakeholders

In fiscal year 2020, the federal government spent approximately $3.1 trillion more than it received. What does this statistic represent?

The federal deficit

In her Principles of Economics course, Valentina learned about the characteristics of socialism. These characteristics include all but which of the following?

The government owns all smaller businesses.

Inspired by her visit to a Voodoo Donut shop in Austin, Texas, Nahia decided to start her own donut shop in her hometown of Jacksonville, Florida. As a result of her passion for donuts and her hard work, Nahia's donut shop became very successful. As a result, Nahia became personally wealthy, she paid, local, state, and federal taxes on her earnings, and she contributed generously to local causes. This is an example of which theory of economics?

The invisible hand

Tobias, a first-year student at the local community college, has just inherited $25,000 from his dear aunt Katharina, and Tobias would like to pursue a course of study that will help him earn the best financial return on his inheritance. Which of the following is a reason Tobias should study business?

To become a better informed investor

Isabel is interested in taking an Introduction to Business course during her freshman year at university. Which of the following is not a reason why she should study business?

To pursue the sole path to self-actualization