Business Practice Exam 1 Questions
and All Correct Answers 2026
Updated.
Business - Answer organized effort of individuals to produce and sell for a profit, the good
and service that satisfy a society's needs
Free Enterprise - Answer individuals decide what to produce, how to produce it and at what
price to sell it at
Profit - Answer after all business expenses are deducted from sales revenues
What are 4 resources used by business owners - Answer 1) Materials
2) Human Resources
3) Financial Resources
4) Informational Resources
Materials - Answer raw materials used in manufacturing
Human Resources - Answer people who finish labor in return for business
Financial Resources - Answer money required to pay employees, purchase materials, keep
businesses operating
Informational resources - Answer tells managers how effectively resources are being
combined and used
How are Businesses Classified? - Answer 1) Manufacturing
2) Services Businesses
3) Market Intermediaries
4) Consumers
Economics - Answer the study of how wealth is created or distributed
Wealth - Answer anything of value
, Economic System - Answer combination of policies and choices made by a nation regarding
ownership of capital and where economic decisions are made
Market Economy (Capitalism) - Answer -individuals own and operate majority of business
-driven by profit motive and competition
-laissez faire
Free Market - Answer economy where individuals make decisions about what to produce,
market and pricing
The Invisible Hand - Answer individuals own personal gain benefits others and nation's
economy
Planned (Command) Economy - Answer Communism and Socialism
Communism - Answer private property is eliminated and government owns all major forms
of production and makes all economic decisions
Socialism - Answer government owns and operates major industries or sectors in the
economy
Mixed Economies - Answer Blend of characteristics of planned and market economies in
which there are private enterprises, however the government is involved
Where is a Market Economy used? - Answer USA, Canada, and France
Where is a Planned Economy used? - Answer Russia, China, and Cuba
What are the factors of production? - Answer 1) Natural Resources
2) Labor
3) Capital
4) Entrepreneurship
Entrepreneurship - Answer willingness to take risks and ability to use other factors efficiently
How is Economic Performance measured? - Answer -Productivity
-GDP
and All Correct Answers 2026
Updated.
Business - Answer organized effort of individuals to produce and sell for a profit, the good
and service that satisfy a society's needs
Free Enterprise - Answer individuals decide what to produce, how to produce it and at what
price to sell it at
Profit - Answer after all business expenses are deducted from sales revenues
What are 4 resources used by business owners - Answer 1) Materials
2) Human Resources
3) Financial Resources
4) Informational Resources
Materials - Answer raw materials used in manufacturing
Human Resources - Answer people who finish labor in return for business
Financial Resources - Answer money required to pay employees, purchase materials, keep
businesses operating
Informational resources - Answer tells managers how effectively resources are being
combined and used
How are Businesses Classified? - Answer 1) Manufacturing
2) Services Businesses
3) Market Intermediaries
4) Consumers
Economics - Answer the study of how wealth is created or distributed
Wealth - Answer anything of value
, Economic System - Answer combination of policies and choices made by a nation regarding
ownership of capital and where economic decisions are made
Market Economy (Capitalism) - Answer -individuals own and operate majority of business
-driven by profit motive and competition
-laissez faire
Free Market - Answer economy where individuals make decisions about what to produce,
market and pricing
The Invisible Hand - Answer individuals own personal gain benefits others and nation's
economy
Planned (Command) Economy - Answer Communism and Socialism
Communism - Answer private property is eliminated and government owns all major forms
of production and makes all economic decisions
Socialism - Answer government owns and operates major industries or sectors in the
economy
Mixed Economies - Answer Blend of characteristics of planned and market economies in
which there are private enterprises, however the government is involved
Where is a Market Economy used? - Answer USA, Canada, and France
Where is a Planned Economy used? - Answer Russia, China, and Cuba
What are the factors of production? - Answer 1) Natural Resources
2) Labor
3) Capital
4) Entrepreneurship
Entrepreneurship - Answer willingness to take risks and ability to use other factors efficiently
How is Economic Performance measured? - Answer -Productivity
-GDP
