Fundamentals of Business Exam #1
Questions with Verified Answers
value - ANSWERSrelationship between the price of a good/service and the benefits that
it offers
business - ANSWERSany organization that provides goods/services in an effort to earn
a profit
profit - ANSWERSmoney that a business earns in sales
loss - ANSWERSwhen a business incurs expenses that are greater than its revenue
entrepreneurs - ANSWERSpeople who risk their time, money, and other resources to
start and manage a business
industrial revolution era - ANSWERSmid 1700's - mid 1800's, mass production took
over, less skills/larger production
entrepreneurship era - ANSWERS2nd half of 1800's, competition/manipulation,
business empires created/took over small businesses and raised standard of living
nationwide
production era - ANSWERSearly 1900's, major business began refining efficiency,
assembly line, no customer focus, post great depression, customer wants came into
play
marketing era - ANSWERSpost WWII, consumers have power, more choice, to
differentiate businesses developed branding, product differentiation
relationship era - ANSWERS1900's on, aim to build long term relationships/brand
loyalty, technology as a source of collecting demographics about customers
nonprofits - ANSWERSbusiness like establishments that employ people and produce
goods/services with the fundamental goal of contributing to the community rather than
making a profit
factors of production - ANSWERSfour fundamental elements - natural, resources,
capital, human resources, entrepreneurship
natural resources - ANSWERSinputs that offer value in their natural state, value rises
with high demand, low supply, or both
, capital - ANSWERSmachines, tools, buildings, information - synthetic resources that
businesses need to produce goods/services, NOT MONEY
human resources - ANSWERSphysical, intellectual/creative contributions within an
economy, technology replaces manual labor, education becomes more important,
employees
entrepreneurship - ANSWERSeconomic freedom of who to hire, for instance, what to
produce, freedom from excess regulation, and freedom from too much taxation (key to a
nation's wealth)
5 key dimensions of business environment - ANSWERS1) economic environment 2)
workforce advantage 3) technological environment 4) social environment 6) global
environment
free trade - ANSWERSinternational/economic/political movement designed to help
goods/services flow more freely across nations
general agreement on tariffs/trades (GATT) - ANSWERSint. trade agreement that has
taken bold steps to lower tariffs and promote free trade
economy - ANSWERSa financial and social system of how resources flow through
society from production to distribution to consumption
economics - ANSWERSthe study of the choices that people, companies and
governments make in allocating society's resources
macroeconomics - ANSWERSthe study of a country's overall economic dynamics, such
as the employment rate, the gross domestic product, and taxation policies
microeconomics - ANSWERSthe study of smaller economic units such as individual
consumers, families, and individual businesses
the american recovery and reinvestment act - ANSWERScutting taxes, building
infrastructure, investing $150 billion in green energy
fiscal policy - ANSWERSgov efforts to influence the economy through taxation and
spending
budget surplus - ANSWERSoverage that occurs when revenue is higher than expenses
over a given period of time
budget deficit - ANSWERSshortfall that occurs when expenses are higher than revenue
over a given period of time
Questions with Verified Answers
value - ANSWERSrelationship between the price of a good/service and the benefits that
it offers
business - ANSWERSany organization that provides goods/services in an effort to earn
a profit
profit - ANSWERSmoney that a business earns in sales
loss - ANSWERSwhen a business incurs expenses that are greater than its revenue
entrepreneurs - ANSWERSpeople who risk their time, money, and other resources to
start and manage a business
industrial revolution era - ANSWERSmid 1700's - mid 1800's, mass production took
over, less skills/larger production
entrepreneurship era - ANSWERS2nd half of 1800's, competition/manipulation,
business empires created/took over small businesses and raised standard of living
nationwide
production era - ANSWERSearly 1900's, major business began refining efficiency,
assembly line, no customer focus, post great depression, customer wants came into
play
marketing era - ANSWERSpost WWII, consumers have power, more choice, to
differentiate businesses developed branding, product differentiation
relationship era - ANSWERS1900's on, aim to build long term relationships/brand
loyalty, technology as a source of collecting demographics about customers
nonprofits - ANSWERSbusiness like establishments that employ people and produce
goods/services with the fundamental goal of contributing to the community rather than
making a profit
factors of production - ANSWERSfour fundamental elements - natural, resources,
capital, human resources, entrepreneurship
natural resources - ANSWERSinputs that offer value in their natural state, value rises
with high demand, low supply, or both
, capital - ANSWERSmachines, tools, buildings, information - synthetic resources that
businesses need to produce goods/services, NOT MONEY
human resources - ANSWERSphysical, intellectual/creative contributions within an
economy, technology replaces manual labor, education becomes more important,
employees
entrepreneurship - ANSWERSeconomic freedom of who to hire, for instance, what to
produce, freedom from excess regulation, and freedom from too much taxation (key to a
nation's wealth)
5 key dimensions of business environment - ANSWERS1) economic environment 2)
workforce advantage 3) technological environment 4) social environment 6) global
environment
free trade - ANSWERSinternational/economic/political movement designed to help
goods/services flow more freely across nations
general agreement on tariffs/trades (GATT) - ANSWERSint. trade agreement that has
taken bold steps to lower tariffs and promote free trade
economy - ANSWERSa financial and social system of how resources flow through
society from production to distribution to consumption
economics - ANSWERSthe study of the choices that people, companies and
governments make in allocating society's resources
macroeconomics - ANSWERSthe study of a country's overall economic dynamics, such
as the employment rate, the gross domestic product, and taxation policies
microeconomics - ANSWERSthe study of smaller economic units such as individual
consumers, families, and individual businesses
the american recovery and reinvestment act - ANSWERScutting taxes, building
infrastructure, investing $150 billion in green energy
fiscal policy - ANSWERSgov efforts to influence the economy through taxation and
spending
budget surplus - ANSWERSoverage that occurs when revenue is higher than expenses
over a given period of time
budget deficit - ANSWERSshortfall that occurs when expenses are higher than revenue
over a given period of time
