Business Administration exam quiz
and answers graded A+
Small Business - ANS✅✅Independently owned and operated with less than 500 employees
Small and medium-sized enterprises (SME) - ANS✅✅Makes up 99% of all business enterprises and
employs 53% of the work force
Franchise - ANS✅✅A business established or operated under an authorization to sell or distribute
a company's goods or services in a particular area
Entrepreneur - ANS✅✅A person who starts up and takes on the financial risk of a business
Franchisee - ANS✅✅Purchases the right to sell the good or service of the seller
Franchisor - ANS✅✅an individual or organization granting a franchise
Profit - ANS✅✅Amount of money remaining after costs have been subtracted
Factors of Production - ANS✅✅Natural resources, Human resources, Capital, and
Entrepreneurship
Natural Resources - ANS✅✅Naturally occurring elements of the physical environment
Human Resources - ANS✅✅Refers to the input of people to the production process
Capital - ANS✅✅Another way to refer to money or funds used to pay employees
Entrepreneurship - ANS✅✅Intangible resource but every bit is as essential as the other three
Microeconomics - ANS✅✅Is the study of the decisions made by individual units of the economy
like consumers or firms
,Macroeconomics - ANS✅✅Studies the performance of the national economy as a whole
Communism - ANS✅✅An economic system in which production facilities are communally owned
by the public
Socialism - ANS✅✅equal distribution of income and social services
Capitalistic economy - ANS✅✅The role of government is to support private ownership and
encourage entrepreneurship
Command/Planned Economics - ANS✅✅a central government makes all of the decisions about
which goods and services will be produced
Free Market Economy - ANS✅✅Based on competition in the marketplace and private ownership
of the factors of production
Mixed Economy - ANS✅✅Combines elements of the other two types of systems
Law of Supply and Demand - ANS✅✅Describes the relationship among the demand for a product,
supply for a product, and an equilibrium price
Equilibrium price - ANS✅✅is the price at which the quantity of goods demanded and the quantity
of goods supplied are equal
Surpluses - ANS✅✅when quantity exceeds the amount demanded
Shortages - ANS✅✅the quantity demanded is greater than that supplied
Free Market System - ANS✅✅buyers are free to buy what they want at whatever price they wish
to pay and producers provide the goods and services needed and wanted by prospective buyers
Perfect Competition - ANS✅✅is the most highly competitive market situation
, Monopoly - ANS✅✅A single firm accounts for all industry sales
Natural Monopoly - ANS✅✅An example of this is an electrical company
Legal Monopoly - ANS✅✅is created when the government issues a patent or trademark
Monopolistic Competition - ANS✅✅Exists when there are many buyers and sellers, products are
differentiated and the firms have some control over the price
Oligopoly - ANS✅✅competition among few companies
Stages of the Business Cycle - ANS✅✅Peak, recession, trough, and recovery
Monetary Policy - ANS✅✅Federal reserve's decision that determines the size of the supply of
money and level of interests rates
Fiscal Policy - ANS✅✅To influence the amount of savings and expenditures by the federal
government
Federal Deficit - ANS✅✅When the government spends more than it receives in a fiscal year
National Debt - ANS✅✅The total of all Federal deficits
Gross Domestic Policy (GDP) - ANS✅✅The sum total of the value of all the goods and services
produced in a nation
Gross National Product - ANS✅✅The total value of goods and services produced within a given
period of time by a national economy
General environmental factors - ANS✅✅The organization has no control over these factors
and answers graded A+
Small Business - ANS✅✅Independently owned and operated with less than 500 employees
Small and medium-sized enterprises (SME) - ANS✅✅Makes up 99% of all business enterprises and
employs 53% of the work force
Franchise - ANS✅✅A business established or operated under an authorization to sell or distribute
a company's goods or services in a particular area
Entrepreneur - ANS✅✅A person who starts up and takes on the financial risk of a business
Franchisee - ANS✅✅Purchases the right to sell the good or service of the seller
Franchisor - ANS✅✅an individual or organization granting a franchise
Profit - ANS✅✅Amount of money remaining after costs have been subtracted
Factors of Production - ANS✅✅Natural resources, Human resources, Capital, and
Entrepreneurship
Natural Resources - ANS✅✅Naturally occurring elements of the physical environment
Human Resources - ANS✅✅Refers to the input of people to the production process
Capital - ANS✅✅Another way to refer to money or funds used to pay employees
Entrepreneurship - ANS✅✅Intangible resource but every bit is as essential as the other three
Microeconomics - ANS✅✅Is the study of the decisions made by individual units of the economy
like consumers or firms
,Macroeconomics - ANS✅✅Studies the performance of the national economy as a whole
Communism - ANS✅✅An economic system in which production facilities are communally owned
by the public
Socialism - ANS✅✅equal distribution of income and social services
Capitalistic economy - ANS✅✅The role of government is to support private ownership and
encourage entrepreneurship
Command/Planned Economics - ANS✅✅a central government makes all of the decisions about
which goods and services will be produced
Free Market Economy - ANS✅✅Based on competition in the marketplace and private ownership
of the factors of production
Mixed Economy - ANS✅✅Combines elements of the other two types of systems
Law of Supply and Demand - ANS✅✅Describes the relationship among the demand for a product,
supply for a product, and an equilibrium price
Equilibrium price - ANS✅✅is the price at which the quantity of goods demanded and the quantity
of goods supplied are equal
Surpluses - ANS✅✅when quantity exceeds the amount demanded
Shortages - ANS✅✅the quantity demanded is greater than that supplied
Free Market System - ANS✅✅buyers are free to buy what they want at whatever price they wish
to pay and producers provide the goods and services needed and wanted by prospective buyers
Perfect Competition - ANS✅✅is the most highly competitive market situation
, Monopoly - ANS✅✅A single firm accounts for all industry sales
Natural Monopoly - ANS✅✅An example of this is an electrical company
Legal Monopoly - ANS✅✅is created when the government issues a patent or trademark
Monopolistic Competition - ANS✅✅Exists when there are many buyers and sellers, products are
differentiated and the firms have some control over the price
Oligopoly - ANS✅✅competition among few companies
Stages of the Business Cycle - ANS✅✅Peak, recession, trough, and recovery
Monetary Policy - ANS✅✅Federal reserve's decision that determines the size of the supply of
money and level of interests rates
Fiscal Policy - ANS✅✅To influence the amount of savings and expenditures by the federal
government
Federal Deficit - ANS✅✅When the government spends more than it receives in a fiscal year
National Debt - ANS✅✅The total of all Federal deficits
Gross Domestic Policy (GDP) - ANS✅✅The sum total of the value of all the goods and services
produced in a nation
Gross National Product - ANS✅✅The total value of goods and services produced within a given
period of time by a national economy
General environmental factors - ANS✅✅The organization has no control over these factors
