Business Practice Exam 1-Graded A
Business - correct answer-organized effort of individuals to produce and sell for a profit,
the good and service that satisfy a society's needs
Free Enterprise - correct answer-individuals decide what to produce, how to produce it
and at what price to sell it at
Profit - correct answer-after all business expenses are deducted from sales revenues
What are 4 resources used by business owners - correct answer-1) Materials
2) Human Resources
3) Financial Resources
4) Informational Resources
Materials - correct answer-raw materials used in manufacturing
Human Resources - correct answer-people who finish labor in return for business
Financial Resources - correct answer-money required to pay employees, purchase
materials, keep businesses operating
Informational resources - correct answer-tells managers how effectively resources are
being combined and used
How are Businesses Classified? - correct answer-1) Manufacturing
2) Services Businesses
3) Market Intermediaries
4) Consumers
Economics - correct answer-the study of how wealth is created or distributed
Wealth - correct answer-anything of value
Economic System - correct answer-combination of policies and choices made by a
nation regarding ownership of capital and where economic decisions are made
Market Economy (Capitalism) - correct answer--individuals own and operate majority of
business
-driven by profit motive and competition
-laissez faire
, Free Market - correct answer-economy where individuals make decisions about what to
produce, market and pricing
The Invisible Hand - correct answer-individuals own personal gain benefits others and
nation's economy
Planned (Command) Economy - correct answer-Communism and Socialism
Communism - correct answer-private property is eliminated and government owns all
major forms of production and makes all economic decisions
Socialism - correct answer-government owns and operates major industries or sectors
in the economy
Mixed Economies - correct 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? - correct answer-USA, Canada, and France
Where is a Planned Economy used? - correct answer-Russia, China, and Cuba
What are the factors of production? - correct answer-1) Natural Resources
2) Labor
3) Capital
4) Entrepreneurship
Entrepreneurship - correct answer-willingness to take risks and ability to use other
factors efficiently
How is Economic Performance measured? - correct answer--Productivity
-GDP
Productivity - correct answer-average level of output per worker
Gross Domestic Product - correct answer-(GDP) total dollar value of all goods and
services produced by all people within the boundaries of a country during one year's
period
Prosperity - correct answer--high income
-low unemployment
-expansion
-high prices
Recession - correct answer-- 2-3 months of decline
- price discounting
- high unemployment
Business - correct answer-organized effort of individuals to produce and sell for a profit,
the good and service that satisfy a society's needs
Free Enterprise - correct answer-individuals decide what to produce, how to produce it
and at what price to sell it at
Profit - correct answer-after all business expenses are deducted from sales revenues
What are 4 resources used by business owners - correct answer-1) Materials
2) Human Resources
3) Financial Resources
4) Informational Resources
Materials - correct answer-raw materials used in manufacturing
Human Resources - correct answer-people who finish labor in return for business
Financial Resources - correct answer-money required to pay employees, purchase
materials, keep businesses operating
Informational resources - correct answer-tells managers how effectively resources are
being combined and used
How are Businesses Classified? - correct answer-1) Manufacturing
2) Services Businesses
3) Market Intermediaries
4) Consumers
Economics - correct answer-the study of how wealth is created or distributed
Wealth - correct answer-anything of value
Economic System - correct answer-combination of policies and choices made by a
nation regarding ownership of capital and where economic decisions are made
Market Economy (Capitalism) - correct answer--individuals own and operate majority of
business
-driven by profit motive and competition
-laissez faire
, Free Market - correct answer-economy where individuals make decisions about what to
produce, market and pricing
The Invisible Hand - correct answer-individuals own personal gain benefits others and
nation's economy
Planned (Command) Economy - correct answer-Communism and Socialism
Communism - correct answer-private property is eliminated and government owns all
major forms of production and makes all economic decisions
Socialism - correct answer-government owns and operates major industries or sectors
in the economy
Mixed Economies - correct 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? - correct answer-USA, Canada, and France
Where is a Planned Economy used? - correct answer-Russia, China, and Cuba
What are the factors of production? - correct answer-1) Natural Resources
2) Labor
3) Capital
4) Entrepreneurship
Entrepreneurship - correct answer-willingness to take risks and ability to use other
factors efficiently
How is Economic Performance measured? - correct answer--Productivity
-GDP
Productivity - correct answer-average level of output per worker
Gross Domestic Product - correct answer-(GDP) total dollar value of all goods and
services produced by all people within the boundaries of a country during one year's
period
Prosperity - correct answer--high income
-low unemployment
-expansion
-high prices
Recession - correct answer-- 2-3 months of decline
- price discounting
- high unemployment
