BMGT 110 Midterm Review UMD Lit
Exam Latest Update
loss - ANSWER when a business's expenses are more than its revenues
productivity - ANSWER amount of output you generate given the amount of input
BRIC - ANSWER Brazil, Russia, India, China (prior to 2008 these countries were
held in a high regard++)
PIGS - ANSWER Portugal, Ireland, Greece, Spain (they face budget shortfalls--)
when picking a location for business consider... - ANSWER tax rate, cost of
doing business, employment rate, cost of living
stock options - ANSWER A privilege, sold by one party to another, that gives the
buyer the right, but not the obligation, to buy (call) or sell (put) a stock at an
agreed-upon price within a certain period or on a specific date
WTI - ANSWER West Texas Index - shows price of crude oil - high is bad
DOW - ANSWER 30 main companies in the stock market - representative of the
rest of the economy
BDI - ANSWER provides an assessment of the price of moving the major raw
materials by sea - indicator of growth and production - rates for 23 oversea
shipping routes - high is bad and low is good
Consumer Price Index (CPI) - ANSWER Index that represents goods and
services that everyday people buy
sole proprietorship - ANSWER a business owned and usually managed by one
person
partnership - ANSWER a legal form of business with 2 or more owners
corporation - ANSWER a legal entity with authority to act and have liability apart
from its owners
advantages of sole proprietorship - ANSWER -easy to start/end business
-your own boss
-pride of ownership
-retention of profits
-no special taxes
, -legacy
disadvantages of sole proprietorship - ANSWER -risk of personal loss
-limited financial resources
-management difficulties
-time commitment
-limited growth
-few fringe benfits (no paid health insurance/sick days)
-if owner dies , company dies unless taken over
10 treasury note interest rate - ANSWER type of bond in which the interest rate
is important because it shows how much money you can make by investing in
the government
Shanghai - ANSWER economic index in China - indicator of international
economy
4 basic rights of capitalism - ANSWER -own private property
-keep business's profits
-freedom to compete
-freedom of choice (location and job choice)
Negative CPI + recession = - ANSWER depression
advantages of partnerships - ANSWER -more financial resources
-shared management/knowledge
-longer survival (4x more likely to succeed than sole proprietorship)
-no special taxes
disadvantages of partnerships - ANSWER -unlimited liability
-division of profits
-disagreement btween partners
-difficult to end the business (who gets what when it ends)
advantages of coorporations - ANSWER -limited liability
-ability to raise more money for investment (stock)
-size
-perpetual life
-easy to change owners
-easy to attract employees (offer stock options)
-separation of ownership from management
deflation - ANSWER prices going down; too many goods, not enough buyers
market price - ANSWER the price people will pay when supply meets demand
Exam Latest Update
loss - ANSWER when a business's expenses are more than its revenues
productivity - ANSWER amount of output you generate given the amount of input
BRIC - ANSWER Brazil, Russia, India, China (prior to 2008 these countries were
held in a high regard++)
PIGS - ANSWER Portugal, Ireland, Greece, Spain (they face budget shortfalls--)
when picking a location for business consider... - ANSWER tax rate, cost of
doing business, employment rate, cost of living
stock options - ANSWER A privilege, sold by one party to another, that gives the
buyer the right, but not the obligation, to buy (call) or sell (put) a stock at an
agreed-upon price within a certain period or on a specific date
WTI - ANSWER West Texas Index - shows price of crude oil - high is bad
DOW - ANSWER 30 main companies in the stock market - representative of the
rest of the economy
BDI - ANSWER provides an assessment of the price of moving the major raw
materials by sea - indicator of growth and production - rates for 23 oversea
shipping routes - high is bad and low is good
Consumer Price Index (CPI) - ANSWER Index that represents goods and
services that everyday people buy
sole proprietorship - ANSWER a business owned and usually managed by one
person
partnership - ANSWER a legal form of business with 2 or more owners
corporation - ANSWER a legal entity with authority to act and have liability apart
from its owners
advantages of sole proprietorship - ANSWER -easy to start/end business
-your own boss
-pride of ownership
-retention of profits
-no special taxes
, -legacy
disadvantages of sole proprietorship - ANSWER -risk of personal loss
-limited financial resources
-management difficulties
-time commitment
-limited growth
-few fringe benfits (no paid health insurance/sick days)
-if owner dies , company dies unless taken over
10 treasury note interest rate - ANSWER type of bond in which the interest rate
is important because it shows how much money you can make by investing in
the government
Shanghai - ANSWER economic index in China - indicator of international
economy
4 basic rights of capitalism - ANSWER -own private property
-keep business's profits
-freedom to compete
-freedom of choice (location and job choice)
Negative CPI + recession = - ANSWER depression
advantages of partnerships - ANSWER -more financial resources
-shared management/knowledge
-longer survival (4x more likely to succeed than sole proprietorship)
-no special taxes
disadvantages of partnerships - ANSWER -unlimited liability
-division of profits
-disagreement btween partners
-difficult to end the business (who gets what when it ends)
advantages of coorporations - ANSWER -limited liability
-ability to raise more money for investment (stock)
-size
-perpetual life
-easy to change owners
-easy to attract employees (offer stock options)
-separation of ownership from management
deflation - ANSWER prices going down; too many goods, not enough buyers
market price - ANSWER the price people will pay when supply meets demand
