HSB FINAL (145)
WHAT IS? The benefits that come from completion
-Businesses -Consumer -Society
WHAT IS? the people businesses should be socially responsible for
-People who use products -communities where they are located -employees of the business
What are the three factors that affect the value of resources?
1) Productivity 2) Availability of supply 3) Demand
DEFINE: Producer
A business that produces goods *2 examples
DEFINE: Regulated monopolies
An exception-- allowed when its too expensive for another company to compete. *2 examples
Which of the following is one of the main principles of the private enterprise system: A) monopolies B) competition C) price fixing D) exclusive agreements
B) competition
DEFINE: Partnership
Business owned by two or more people *2 examples
DEFINE: Trade industries
Businesses that buy and sell goods to others *2 examples
The automobile industry, the pharmaceutical industry, and the oil industry are all examples of A) a regulated monopoly B) perfect competition C) oligopolies D) monopolistic competition
C) oligopolies
WHAT IS? there is two variations of this: -socialism -communism
Command economic system
WHAT IS? _ makes better and less expensive goods and services in the business world
Competition
WHAT IS? smaller companies combine into a larger one
Consolidation
Which of the following statements about perfect competition is correct: A) There is a limited supply of goods and services. B) Businesses have a good deal of control over the market. C) Products vary from seller to seller. D) It is used as a benchmark to compare real market structures against.
D) It is used as a benchmark to compare real market structures against.
DEFINE: Exchange
Economic transaction *2 examples
DEFINE: Monopolistic Competition
LOTS of businesses sell similar product that have few differences *2 examples
WHAT IS? Combining of two or more companies
Merger
DEFINE: Competition
Rivalry among two or more businesses to attract scarce or limited customer dollars *2 examples
WHAT IS? When businesses have a duty to contribute to the well being of society
Social responsibility
TRUE OR FALSE? the following is a situation in which people are out of work and can't afford "extra" purchases: Bad company
TRUE answers like Unexpected event, Bad investment, & Negative circumstances may sound like a good answer, but they are actually incorrect.
DEFINE: Economic risks
The type of risk that involves changes in the market, which in return effect prices of goods *2 examples
DEFINE: Possession utility
Usefulness created when in the ownership of the right person *2 examples
DEFINE: Opportunity costs/Trade-offs
What you give up in order to gain *2 examples
DEFINE: Shopping products
When customers shop around for the best price and quality with advice from salesperson. *2 examples
DEFINE: Oligopoly
When only a FEW businesses sell all the products *2 examples
DEFINE: Nonprice competition
When two businesses compete other than price *2 examples
DEFINE: Pure risks
a characteristic of risks that brings the possibility of either loss or no loss, no gray area included. *2 examples
DEFINE: want
a desire for something we may or may not require. *2 examples
DEFINE: Utility
adding usefulness to a product *2 examples
DEFINE: Form utility
altering a good to make it more useful *2 examples
WHAT IS? socialism
socialism is when the gov meets the basic needs of everyone
WHAT IS? Private enterprise
business managed by private individuals rather than the government
DEFINE: Sole proprietorship
business owned by an individual *2 examples
DEFINE: Profit reward
business owner wants to reward themselves for their efforts *2 examples
DEFINE: Natural resources
can be renewed from the earth *2 examples
WHAT IS? a traditional economic system
economic decisions
DEFINE: guarantee
example of a way to transfer risk. 100% _________ *2 examples
DEFINE: Industrial goods
goods and services purchased by a business so they can provide their products. *2 examples
DEFINE: Consumer goods
goods and services that are purchased and used by end consumer. *2 examples
WHAT IS? an economic system
how a country uses its resources
DEFINE: Convenience Products
item you purchase quickly without much thought. *2 examples
DEFINE: Distribution
making goods and services available for use by consumers *2 examples
DEFINE: Expenses
money a business spends *2 examples
DEFINE: good
something you can touch, it is tangible, it is useful. *2 examples
DEFINE: non economic want
something you do not have to spend money in order to receive your want. *2 examples
DEFINE: Human resources
the people who produce goods and services. *2 examples
DEFINE: Speculative risks
possibilities of loss, gain, or no change. *2 examples
DEFINE: Business risk
possibility of failure or sucess *2 examples
DEFINE: services
productive acts that satisfy economic wants. *2 examples
DEFINE: unsought products
products you buy because you need, not necessarily want. *2 examples
DEFINE: Profit
reward a business owner receives for taking a risk *2 examples
DEFINE: gross profit
sales income-cost of goods *2 examples
DEFINE: Retailers
sells to end consumer *2 examples
DEFINE: Wholesalers
sells to other businesses *2 examples
DEFINE: Economy
social system of production, exchange, distribution, and consumer goods *2 examples
DEFINE: Income
money you get for the work you have done *2 examples
DEFINE: corporation
owned by stockholders *2 examples
WHAT IS? Four types of corporations
1) closed 2) Open 3) S 4) Non profit
WHAT IS? Government legislation affecting competition
-Sherman anti-trust act -clayton act federal trade commission act -robinson-patman act -celler-Kefauver anti-merger act
WHAT IS? two types of partnership arrangements
1) General partner ship 2) Limited partnership *Briefly describe each
WHAT IS? Two ways a business can be socially responsible
1) Maximize profits for the business 2) Contribute to public interests
What are the four market structures?
1) Monopoly 2) Oligopoly 3) Perfect/Pure 4) monopolistic competition *BRIEFLY DESCRIBE EACH
WHAT IS? three ways corporations can grow
1) Sell more stock 2) Mergers 3) consolidations
Which activities are likely to increase a firm's profit? A) increasing sales and decreasing expenses B) increasing supplies and decreasing production C) decreasing sales and increasing expenses D) increasing supplies and increasing production
A) increasing sales and decreasing expenses
Which of the following factors that affect profit usually able to be controlled? A) incomes and expenses B) Expenses and pricing C) pricing and billing D) Expenses and billing
B) Expenses and pricing
Which of the following is a direct benefit to consumers of the effects of competition: A) higher product prices B) wider product selection C) wise use of resources D) fewer new businesses in the market
B) wider product selection
TRUE OR FALSE? When employees are working faster or better, they are increasing their: Value
FALSE efficiency (is a better answer) goes up when employees are working more productively.
WHAT IS? growing your business
Expansion
DEFINE: Monopoly
Exists when a market is controlled by one business *2 examples
TRUE OR FALSE? When Maura purchased a new car, she was able to get part of the purchase price back from the car's manufacturer. The car's manufacturer engaged in: price fixing
FALSE offering rebate is the return of part of a payment for a good. Unlike a discount, which is deducted from the price before purchase, a rebate is returned after purchase.
TRUE OR FALSE? The amount of money paid for raw materials and product sold is called: operating expense
FALSE Cost of goods is the amount of money paid for raw materials.
WHAT IS? distributing recognized goods and services through a legal agreement
Franchise
DEFINE: Service businesses
Perform intangible activities that satisfy peoples needs and wants *2 examples
DEFINE: Limited liability company
Owners enjoy advantages of corporation
DEFINE: Producers
People who make goods or services *2 examples
WHAT IS? independent sale between a franchisor and a franchisee
Product trade-name franchise
DEFINE: Warranties
Promise to repair or replace a faulty product. Example of a way to transfer risk. *2 examples
DEFINE: Raw-goods producer
Provides raw materials *2 examples
TRUE OR FALSE? Most businesses put their greatest competitive efforts into competing: with direct competitors.
TRUE answers like locally, nationally, & with indirect competitors may seem correct. But it makes more sense for businesses to compete with direct competitors, because they may not need to compete with local and national businesses. But they will always have competition with direct competitors.
TRUE OR FALSE? the following are qualities of monopolies: high prices and low production
TRUE this question is tricky because, low production and much competition; high prices and much competition; & low prices and little competition sound right. But monopolies have close to total control, causing high prices and low production in order to encourage competition.
DEFINE: Production
The act of making goods *2 examples
DEFINE: Direct competition
Type of competition that occurs among business that offer similar goods or services *2 examples
DEFINE: Indirect competition
Type of competition that occurs when businesses do NOT offer the same or similar goods, but still compete *2 examples
DEFINE: Natural Risks
Type of risk that results from natural causes *2 examples
DEFINE: Price competition
Type of rivalry between businesses that use price to lure customers. *2 examples
DEFINE: Specialty Products
Unique and special products, often brand name. *2 examples
DEFINE: cost of goods
amount of money a business pays for raw material *2 examples
DEFINE: operating expenses
an on-going cost for running a business *2 examples
DEFINE: Economizing
avoiding waste *2 examples
DEFINE: Manufacturers
changes the shape or form of materials to make them useful to consumers *2 examples
WHAT IS? communism
gov does all
DEFINE: net Profit
gross profit-operating expenses *2 examples
DEFINE: Consumer
the person who is receiving/using a goods or service *2 examples
DEFINE: economics
the social science of an economy *2 examples
DEFINE: Economic resources (aka factors of production)
these are used by a business to produce goods and services. *2 examples
DEFINE: Human risks
type of risk caused by human weakness *2 examples
DEFINE: Capital goods
used in the production of goods and services *2 examples
DEFINE: Place utility
usefulness created by changing where a product is *2 examples
DEFINE: time utility
usefulness made when a product is available at a certain time. *2 examples
DEFINE: Consumption
utilization of economic goods *2 examples
DEFINE: Pure/Perfect competition
when MANY businesses sell the same product and there Is plenty of options *2 examples
DEFINE: scarcity
when we have unlimited wants and limited needs. *2 examples
DEFINE: economic want
when you have to spend money in order to receive your want. *2 examples