Final Exam Review Part 2
A popular product is said to be in high..
Demand
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 Risks
Carefully selecting goods or services to sell is an example of handling business risks by __________ the risk.
Controlling
One way that competition helps to build a prosperous society is by
Creates new jobs
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
Which of the following are qualities of monopolies:
High Prices and low competition
Which activities are likely to increase a firm's profit?
Increasing sales and decreasing expenses
One way that competition benefits business is by encouraging the creation of
New Business
Offering high quality, large assortments, and free shipping are examples of
Non price competition
Which of the following is a disadvantage of private enterprise:
Periods of Unemployment (if a company isnt making money they cannot afford workers)
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
Businesses can protect themselves from the risk associated with lost shipments by
Purchasing Transportation Insurance
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
Contractual agreements such as guarantees, surety bonds, and leases are examples of handling business risks through
Transferring the risk
Private enterprise is based on the idea that everyone is better served when
When individuals set their own goals
One of the freedoms provided to individuals by the private enterprise system is the freedom to choose
Where they work, you can work wherever you want
Most businesses put their greatest competitive efforts into competing
With Direct Competition
Private Enterprise
business ownership by ordinary people, not the government