BUS 200 Test 1 || WITH COMPLETE SOLUTIONS!!!
Assets correct answers Things that you own
Liabilities correct answers Things that you owe
shareholders equity correct answers Assets - Liabilities = shareholders equity
Competitive Advantage correct answers -some aspect of a product or company that makes it
more appealing to its target customer
-(what is the strength of the company that makes it more attractive than others)
Revenue correct answers Money that a company brings in through the sale of goods and
services
Business Model correct answers -A concise description of how a business intends to generate
revenue
Profit equation correct answers -Pi (profit) = R (revenue) - C (cost)
Barrier to entry correct answers -Any resource or capability a company must have before it
can start competing in a given market (can someone else replicate your product?)
Stakeholders correct answers -Internal and external groups affected by a company's decisions
and activities
-DIFFERENT from shareholders: (a shareholder is a stakeholder but a stakeholder is not
necessarily a shareholder)
Fiscal Policy correct answers policy enacted by the president or congress (spending on
bridges, education, defense)
-government spending
-taxation (revenue going to the government)
GDP/Gross Domestic Product correct answers sum of all goods and services produced in
economy over period of time
Trend GDP correct answers = Potential GDP
the normal level of GDP when we aren't in a boom or bust
countercyclical correct answers When things are booming you try to slow it down, when
things are too slow you try to speed it up
major goal of both fiscal and monetary policy to reduce fluctuations
Unemployment correct answers # of people looking for work / total workforce
Fiscal policy to stimulate the economy correct answers Cutting taxes or raise spending
Federal Open Market Committee correct answers monetary making policy arm of the Federal
Reserve
, -controls interest rates
Whats easier to slow the business cycle? correct answers Easier to slow the business cycle:
monetary policy because fiscal don't like to be the bad cop and there's bad lags in fiscal
policy
monetary policy is better to reduce the fluctuations in the business cycle
Budget surplus correct answers the government takes in more in taxes than it spends
Budget deficit correct answers the government spends more than it takes in taxes
Trade surplus correct answers exporting more than we import
Trade deficit correct answers importing more than we export
4 points of GDP growth curve correct answers Peak: highest point of GDP before a downturn
Recession: period of negative GDP growth for 2 or more quarters
Trough: lull in growth
Expansion: early part is called recovery
Theory of competitive advantage correct answers countries should tend to specialize in
industries that take advantage of their relative factor endowments and through trade and
specialization they could be made better off
countries should focus on what they have in abundance
Absolute advantage correct answers who can produce more of a good
Autarky correct answers absence of trade
Review supply and demand curves!!!!! correct answers
Tax haven correct answers country that has lax banking laws, low tax rates
Foreign Direct Investment correct answers Investment of money by foreign companies in
domestic business enterprises
Multinational corporations correct answers companies with operations in more than one
country
Transparency correct answers The degree to which affected parties can observe relevant
aspects of transactions or decisions
Insider trading correct answers use of unpublicized information that an individual gains front
the course of his job to benefit from fluctuations in the stock market
Economic globalization correct answers increasing integration and interdependence of
national economics around the world
Assets correct answers Things that you own
Liabilities correct answers Things that you owe
shareholders equity correct answers Assets - Liabilities = shareholders equity
Competitive Advantage correct answers -some aspect of a product or company that makes it
more appealing to its target customer
-(what is the strength of the company that makes it more attractive than others)
Revenue correct answers Money that a company brings in through the sale of goods and
services
Business Model correct answers -A concise description of how a business intends to generate
revenue
Profit equation correct answers -Pi (profit) = R (revenue) - C (cost)
Barrier to entry correct answers -Any resource or capability a company must have before it
can start competing in a given market (can someone else replicate your product?)
Stakeholders correct answers -Internal and external groups affected by a company's decisions
and activities
-DIFFERENT from shareholders: (a shareholder is a stakeholder but a stakeholder is not
necessarily a shareholder)
Fiscal Policy correct answers policy enacted by the president or congress (spending on
bridges, education, defense)
-government spending
-taxation (revenue going to the government)
GDP/Gross Domestic Product correct answers sum of all goods and services produced in
economy over period of time
Trend GDP correct answers = Potential GDP
the normal level of GDP when we aren't in a boom or bust
countercyclical correct answers When things are booming you try to slow it down, when
things are too slow you try to speed it up
major goal of both fiscal and monetary policy to reduce fluctuations
Unemployment correct answers # of people looking for work / total workforce
Fiscal policy to stimulate the economy correct answers Cutting taxes or raise spending
Federal Open Market Committee correct answers monetary making policy arm of the Federal
Reserve
, -controls interest rates
Whats easier to slow the business cycle? correct answers Easier to slow the business cycle:
monetary policy because fiscal don't like to be the bad cop and there's bad lags in fiscal
policy
monetary policy is better to reduce the fluctuations in the business cycle
Budget surplus correct answers the government takes in more in taxes than it spends
Budget deficit correct answers the government spends more than it takes in taxes
Trade surplus correct answers exporting more than we import
Trade deficit correct answers importing more than we export
4 points of GDP growth curve correct answers Peak: highest point of GDP before a downturn
Recession: period of negative GDP growth for 2 or more quarters
Trough: lull in growth
Expansion: early part is called recovery
Theory of competitive advantage correct answers countries should tend to specialize in
industries that take advantage of their relative factor endowments and through trade and
specialization they could be made better off
countries should focus on what they have in abundance
Absolute advantage correct answers who can produce more of a good
Autarky correct answers absence of trade
Review supply and demand curves!!!!! correct answers
Tax haven correct answers country that has lax banking laws, low tax rates
Foreign Direct Investment correct answers Investment of money by foreign companies in
domestic business enterprises
Multinational corporations correct answers companies with operations in more than one
country
Transparency correct answers The degree to which affected parties can observe relevant
aspects of transactions or decisions
Insider trading correct answers use of unpublicized information that an individual gains front
the course of his job to benefit from fluctuations in the stock market
Economic globalization correct answers increasing integration and interdependence of
national economics around the world
