Post Test: Free Market and Businesses
Match the scenarios to the factors that affect the labor market. Carlos is moving from Mexico to the United States because he got a job in a bank. He had his interview last month, and the bank agreed to hire him because he was willing to work for 10% less than most American workers, even though he has the same qualifications. A US supermarket chain is going to open a few supermarkets in Europe because a recent survey showed that the chain has a huge potential for profits in Europe. A renowned US information technology firm has recently signed a contract with a company based in the Philippines. The Filipino company will handle the accounts of the US firm. The US firm made this decision to reduce labor costs.
immigration foreign direct investment outsourcing
What are the advantages a market economy offers producers?
minimal government intervention property rights
shifts PPC to the right point on the original PPC shifts PPC to the left unattainable point
A new technology is invented to produce more food grains in the country. The country is using all its resources efficiently. Many of the country's young people died in an earthquake. The country plans to produce goods that are not possible to produce with the available resources.
Which statement is false?
Growth in the economy shifts the PPC left.
Determine which direction the PPC will shift as a result of these major events.
PPC Shifts Left An epidemic wipes out one-third of the country's population. Educated and skilled workers begin migrating to other countries on a large scale. PPC Shifts Right The government builds an extensive network of highways to facilitate cargo transportation. Private businesses come together to sponsor college education for low-income students.
Which statement is false?
The quality of a good determines wages.
What does a production possibilities curve represent?
a combination of two goods that can be produced using limited resources
What is the definition of economic growth?
a rise in the total amount of goods and services produced within the borders of a nation
How can the government of a nation invest in physical capital?
by building highways, railways, and airports by providing power and Internet connections by importing or developing innovative technologies
How do property rights benefit entrepreneurs?
by enabling them to purchase capital and use it as they see fit
Which factor of production includes human-made resources used to produce a good or a service?
capital
Anita is an entrepreneur who is interested in starting a hair salon. Anita consulted her friend Ali, who is a businessman, to get some business advice. Ali advised Anita to calculate the total ___________ she will need to raise. He advised her to choose a ________________ where she can find skilled labor and plenty of clients. He also advised her to figure out the _______________ for every piece of equipment she buys for the salon.
capital business location total cost of ownership
George works in a factory and is a member of the labor union. He thinks his wages are low for the work that he does, so he tells the union representative that his employer should increase his wages. The representative asks the other workers if they feel the same, and they all agree. The following week, the union representative met with the factory owner regarding an increase in wages, and the employer agreed to it. What strategy did the union use to get the owner to agree to increase wages?
collective bargaining
A country made education free and mandatory up to age 15. It established 100 new schools to educate kids across the country. As a result, citizens acquired the _______ required to work. The schools generated _________ for teachers and other staff. In 20 years, the country saw a rapid __________ in its GDP.
skills employment increase
What does a technical job demand, and in what way does it help the individual doing that job? A highly technical job demands special _________ , which helps the person get higher _________
skills wages
Hillary needs to buy an oven for her bakery. She compares the prices, maintenance costs, and power consumption of three ovens. She compares the loan terms offered on them. Finally, she settles for the one that will offer the best value for the money in the long run. Ramona International wants to raise about $20 million. It sells shares of company stock in the stock market and brings many new shareholders onboard. Maxima and Hercules are rival companies that make protein shakes. People love Maxima protein shakes because they are delicious and packaged attractively. Hercules protein shakes fail to impress most people. Soon, Hercules has to cut production of its protein shakes and focus on other products.
total cost of ownership incorporation consumer sovereignty
