BUS 1750 EXAM 1- WMU STUDY
GUIDE QUESTIONS AND ACTUAL
ANSWERS 2025-2026 UPDATED.
standard of living - Answer the amount of goods and services people can buy with the
money they have
quality of life - Answer general well-being of society in terms of political freedom, natural
environment, education, health care, safety, amount of leisure, and rewards that add to the
satisfaction and joy that other goods and services provide
stakeholders - Answer all the people that stand to gain or lose by the policies and activities
of a business and whose concerns the business needs to address
non-profit - Answer organization whose goals do not include a personal profit for its owners
and organizers
5 elements of business environment - Answer economic and legal environment
technological environment
competitive environment
social environment
global issues environment
revolution of American business - Answer production increase→less workers needed, started
off as agricultural, then industrial/factories, now service-based
economics - Answer study of how society chooses to employ resources to produce goods
and services and distribute them for consumption among various competing groups and
individuals
Adam Smith: Invisible Hand - Answer the process that turns self-directed gain into social and
economic benefits for all
4 foundations of capitalism - Answer 1) right to own private property
, equilibrium point - Answer the crossing point where a certain price reflects an equal amount
of supply and demand
competition in free-markets - Answer companies must ensure that they are providing quality
products to keep up with other companies; prevents a monopoly from forming
socialism - Answer economic system based on premise that some, if not most, basic
businesses should be owned by the govt. so that its profits can be evenly distributed among the
people
communism - Answer economic & political system in which the govt. makes almost all
economic decisions and owns almost all the major factors of production
mixed economic system - Answer system in which some allocation of resources is made by
the market and some by the govt.
gross domestic product (GDP) - Answer total value of final goods and services produced in a
country per year
inflation - Answer general rise in the prices of goods and services over time
deflation - Answer situation in which price increases are slowing (inflation rate is declining)
consumer price index (CPI) - Answer monthly statistics that measure the pace of inflation or
deflation
producer price index (PPI) - Answer index that measures prices at the wholesale level
fiscal policy - Answer federal govt.'s efforts to keep the economy stable by increasing or
decreasing taxes or govt. spending
monetary policy - Answer management of the money supply and interest rates by the
Federal Reserve
GUIDE QUESTIONS AND ACTUAL
ANSWERS 2025-2026 UPDATED.
standard of living - Answer the amount of goods and services people can buy with the
money they have
quality of life - Answer general well-being of society in terms of political freedom, natural
environment, education, health care, safety, amount of leisure, and rewards that add to the
satisfaction and joy that other goods and services provide
stakeholders - Answer all the people that stand to gain or lose by the policies and activities
of a business and whose concerns the business needs to address
non-profit - Answer organization whose goals do not include a personal profit for its owners
and organizers
5 elements of business environment - Answer economic and legal environment
technological environment
competitive environment
social environment
global issues environment
revolution of American business - Answer production increase→less workers needed, started
off as agricultural, then industrial/factories, now service-based
economics - Answer study of how society chooses to employ resources to produce goods
and services and distribute them for consumption among various competing groups and
individuals
Adam Smith: Invisible Hand - Answer the process that turns self-directed gain into social and
economic benefits for all
4 foundations of capitalism - Answer 1) right to own private property
, equilibrium point - Answer the crossing point where a certain price reflects an equal amount
of supply and demand
competition in free-markets - Answer companies must ensure that they are providing quality
products to keep up with other companies; prevents a monopoly from forming
socialism - Answer economic system based on premise that some, if not most, basic
businesses should be owned by the govt. so that its profits can be evenly distributed among the
people
communism - Answer economic & political system in which the govt. makes almost all
economic decisions and owns almost all the major factors of production
mixed economic system - Answer system in which some allocation of resources is made by
the market and some by the govt.
gross domestic product (GDP) - Answer total value of final goods and services produced in a
country per year
inflation - Answer general rise in the prices of goods and services over time
deflation - Answer situation in which price increases are slowing (inflation rate is declining)
consumer price index (CPI) - Answer monthly statistics that measure the pace of inflation or
deflation
producer price index (PPI) - Answer index that measures prices at the wholesale level
fiscal policy - Answer federal govt.'s efforts to keep the economy stable by increasing or
decreasing taxes or govt. spending
monetary policy - Answer management of the money supply and interest rates by the
Federal Reserve
