BUS 100 Final Exam Study Guide – Introduction to Business – 2026 – Study and
Practice Guide
What is Business? - correct answer ✔✔ The organized effort of individuals to produce and sell,
for a profit, the goods and services that satisfy society's needs
Classification of business (manufacturing vs. service vs. intermediaries) - correct answer ✔✔
Manufacturing- any business that uses components to make a finished good
Service- providing work by and individual or team for its customers, such as intangible goods
like insurance, education, banking
Intermediaries- buy products from manufacturers and resell
The function of profit - correct answer ✔✔ -Reward for producing goods and services people
want
-Compensation for assuming the risks of ownership
= risk of not receiving payment
=risk of losing investment
Microeconomics vs. Macroeconomics - correct answer ✔✔ Micro- The study of the decisions
made by individuals and businesses
Macro- The study of the national and global economies
Capitalism Economy vs. Command Economy(socialism and communism) - correct answer ✔✔
Capitalism- Individuals and businesses own the resources and are free to exchange and contract
with each other without decree from government authority. The collective term for these
uncoordinated exchanges is the "market."
Command- Under a command economy, governments own all of the factors of production such
as land, capital and resources, and government officials determine when, where and how much
is produced at any one time
, Economic Indicators- GDP; inflation; unemployment - correct answer ✔✔ Gross Domestic
Product (GDP)- The total value of all goods and services produced by all people within the
boundaries of a country during a one-year period
Inflation- The value of the dollar goes down and demand increases
-Unemployment
Monetary vs. Fiscal policy - correct answer ✔✔ Monetary- The Federal Reserve's ("the Fed")
decisions that determine the size of the supply of money in the nation and the level of interest
rates
Fiscal- Governmental decisions aimed at affecting the level of spending. Accomplished primarily
through government spending and tax rates
(Business) Ethics vs. Laws - correct answer ✔✔ Ethics- Is the application of moral standards
(principles and values that govern actions) to business situations. Right vs. Wrong
Laws- The system of rules that a particular country or community recognizes as regulating the
actions of its members and may enforce the imposition of penalties
Social Responsibility (what it is; 4 concepts; Pros and Cons) - correct answer ✔✔ What it is- The
recognition that business activities have an impact on society and the consideration of that
impact in business decision making
4 Concepts- 1. Philanthropic- contribute resources to community, improve quality of life
2. Ethical- obligation to do what is right, just, and fair
3. Legal- law is society's codification of right and wrong
4. Economic- the foundation upon which all other rest
Pros- As a part of society, business can't ignore social problems.
- Business has the means to tackle social problems.
- Addressing social problems can create a more stable environment.
- Socially-responsible decision making prevents government intervention.
Practice Guide
What is Business? - correct answer ✔✔ The organized effort of individuals to produce and sell,
for a profit, the goods and services that satisfy society's needs
Classification of business (manufacturing vs. service vs. intermediaries) - correct answer ✔✔
Manufacturing- any business that uses components to make a finished good
Service- providing work by and individual or team for its customers, such as intangible goods
like insurance, education, banking
Intermediaries- buy products from manufacturers and resell
The function of profit - correct answer ✔✔ -Reward for producing goods and services people
want
-Compensation for assuming the risks of ownership
= risk of not receiving payment
=risk of losing investment
Microeconomics vs. Macroeconomics - correct answer ✔✔ Micro- The study of the decisions
made by individuals and businesses
Macro- The study of the national and global economies
Capitalism Economy vs. Command Economy(socialism and communism) - correct answer ✔✔
Capitalism- Individuals and businesses own the resources and are free to exchange and contract
with each other without decree from government authority. The collective term for these
uncoordinated exchanges is the "market."
Command- Under a command economy, governments own all of the factors of production such
as land, capital and resources, and government officials determine when, where and how much
is produced at any one time
, Economic Indicators- GDP; inflation; unemployment - correct answer ✔✔ Gross Domestic
Product (GDP)- The total value of all goods and services produced by all people within the
boundaries of a country during a one-year period
Inflation- The value of the dollar goes down and demand increases
-Unemployment
Monetary vs. Fiscal policy - correct answer ✔✔ Monetary- The Federal Reserve's ("the Fed")
decisions that determine the size of the supply of money in the nation and the level of interest
rates
Fiscal- Governmental decisions aimed at affecting the level of spending. Accomplished primarily
through government spending and tax rates
(Business) Ethics vs. Laws - correct answer ✔✔ Ethics- Is the application of moral standards
(principles and values that govern actions) to business situations. Right vs. Wrong
Laws- The system of rules that a particular country or community recognizes as regulating the
actions of its members and may enforce the imposition of penalties
Social Responsibility (what it is; 4 concepts; Pros and Cons) - correct answer ✔✔ What it is- The
recognition that business activities have an impact on society and the consideration of that
impact in business decision making
4 Concepts- 1. Philanthropic- contribute resources to community, improve quality of life
2. Ethical- obligation to do what is right, just, and fair
3. Legal- law is society's codification of right and wrong
4. Economic- the foundation upon which all other rest
Pros- As a part of society, business can't ignore social problems.
- Business has the means to tackle social problems.
- Addressing social problems can create a more stable environment.
- Socially-responsible decision making prevents government intervention.
