BUS 108 VERIFIED EXAM QUESTIONS AND ANSWERS -
LATEST VERSION 2026/2027
Q: What is the definition of a business? ANSWER Any activity that seeks
to provide goods and services to others while operating at a profit.
Q: What is profit? ANSWER The amount of money a business earns
above and beyond what it spends for salaries and other expenses.
Q: What is a loss? ANSWER Occurs when a business's expenses are
more than its revenues.
Q: What is risk? ANSWER The chance an entrepreneur takes of losing
time and money on a business that may not prove profitable.
Q: What are the four factors of production? ANSWER Land, labor,
capital, and entrepreneurship.
Q: In business, what does "land" refer to? ANSWER Natural resources
used in the production process.
Q: In business, what does "capital" refer to? ANSWER The tools,
machinery, buildings, and other assets used to produce goods and
services (not just money).
Q: What is the standard of living? ANSWER The amount of goods and
services people can buy with the money they have.
Q: What is quality of life? ANSWER The general well-being of a society
in terms of political freedom, natural environment, education,
healthcare, safety, etc.
Q: What is stakeholder theory? ANSWER The idea that a business
should consider the interests of all parties affected by its decisions, not
just shareholders.
Q: Who are internal stakeholders? ANSWER Employees, managers, and
board members.
,Q: Who are external stakeholders? ANSWER Customers, suppliers,
creditors, government, and the community.
Q: What is the business environment? ANSWER The surrounding
factors that either help or hinder the development of businesses.
Q: What is the technological environment? ANSWER Forces that create
new technologies, creating new product and market opportunities.
Q: What is the competitive environment? ANSWER The number of
competitors a business must face, the relative size of competitors, and
the degree of interdependence among them.
Q: What is a monopoly? ANSWER A market structure where one
company dominates the market and has no close substitutes for its
product.
Q: What is an oligopoly? ANSWER A market structure dominated by a
few large sellers.
Q: What is monopolistic competition? ANSWER A market structure with
many sellers offering similar but differentiated products.
Q: What is pure (perfect) competition? ANSWER A market structure
with many buyers and sellers, offering identical products, with easy
market entry/exit.
Q: What is the social environment? ANSWER Demographics, changing
attitudes, and cultural values that affect business.
Q: What is demography? ANSWER The statistical study of the human
population with regard to its size, density, and other characteristics.
Q: What is the economic environment? ANSWER Factors that affect
consumer purchasing power and spending patterns.
Q: What is inflation? ANSWER A general rise in the price level of goods
and services over time.
Q: What is deflation? ANSWER A general decrease in the price level of
goods and services.
Q: What is unemployment? ANSWER The percentage of the labor force
that is not currently employed but is actively seeking work.
, Q: What is GDP? ANSWER Gross Domestic Product; the total value of all
final goods and services produced within a country in a given year.
Q: What is a recession? ANSWER A period of economic decline,
typically identified by a fall in GDP in two consecutive quarters.
Q: What is a depression? ANSWER A severe, prolonged economic
downturn.
Q: What is fiscal policy? ANSWER The government's use of taxation and
spending to influence the economy.
Q: What is monetary policy? ANSWER The management of the money
supply and interest rates by a central bank (like the Federal Reserve).
Part 2: Economics & Global Business (31-60)
Q: What is economics? ANSWER The study of how society chooses to
employ resources to produce goods and services and distribute them
for consumption.
Q: What is microeconomics? ANSWER The study of how individuals,
households, and firms make decisions under conditions of scarcity.
Q: What is macroeconomics? ANSWER The study of the broader
economy, looking at aggregate indicators like GDP, unemployment, and
inflation.
Q: What is the law of supply? ANSWER The principle that suppliers will
normally offer more for sale at higher prices and less at lower prices.
Q: What is the law of demand? ANSWER The principle that buyers will
normally buy more of a good at lower prices and less at higher prices.
Q: What is equilibrium price? ANSWER The price where the quantity
demanded by consumers equals the quantity supplied by producers.
Q: What is a surplus? ANSWER A situation where the quantity supplied
exceeds the quantity demanded.
Q: What is a shortage? ANSWER A situation where the quantity
demanded exceeds the quantity supplied.
Q: What is capitalism? ANSWER An economic system in which the
means of production are privately owned and operated for profit.
LATEST VERSION 2026/2027
Q: What is the definition of a business? ANSWER Any activity that seeks
to provide goods and services to others while operating at a profit.
Q: What is profit? ANSWER The amount of money a business earns
above and beyond what it spends for salaries and other expenses.
Q: What is a loss? ANSWER Occurs when a business's expenses are
more than its revenues.
Q: What is risk? ANSWER The chance an entrepreneur takes of losing
time and money on a business that may not prove profitable.
Q: What are the four factors of production? ANSWER Land, labor,
capital, and entrepreneurship.
Q: In business, what does "land" refer to? ANSWER Natural resources
used in the production process.
Q: In business, what does "capital" refer to? ANSWER The tools,
machinery, buildings, and other assets used to produce goods and
services (not just money).
Q: What is the standard of living? ANSWER The amount of goods and
services people can buy with the money they have.
Q: What is quality of life? ANSWER The general well-being of a society
in terms of political freedom, natural environment, education,
healthcare, safety, etc.
Q: What is stakeholder theory? ANSWER The idea that a business
should consider the interests of all parties affected by its decisions, not
just shareholders.
Q: Who are internal stakeholders? ANSWER Employees, managers, and
board members.
,Q: Who are external stakeholders? ANSWER Customers, suppliers,
creditors, government, and the community.
Q: What is the business environment? ANSWER The surrounding
factors that either help or hinder the development of businesses.
Q: What is the technological environment? ANSWER Forces that create
new technologies, creating new product and market opportunities.
Q: What is the competitive environment? ANSWER The number of
competitors a business must face, the relative size of competitors, and
the degree of interdependence among them.
Q: What is a monopoly? ANSWER A market structure where one
company dominates the market and has no close substitutes for its
product.
Q: What is an oligopoly? ANSWER A market structure dominated by a
few large sellers.
Q: What is monopolistic competition? ANSWER A market structure with
many sellers offering similar but differentiated products.
Q: What is pure (perfect) competition? ANSWER A market structure
with many buyers and sellers, offering identical products, with easy
market entry/exit.
Q: What is the social environment? ANSWER Demographics, changing
attitudes, and cultural values that affect business.
Q: What is demography? ANSWER The statistical study of the human
population with regard to its size, density, and other characteristics.
Q: What is the economic environment? ANSWER Factors that affect
consumer purchasing power and spending patterns.
Q: What is inflation? ANSWER A general rise in the price level of goods
and services over time.
Q: What is deflation? ANSWER A general decrease in the price level of
goods and services.
Q: What is unemployment? ANSWER The percentage of the labor force
that is not currently employed but is actively seeking work.
, Q: What is GDP? ANSWER Gross Domestic Product; the total value of all
final goods and services produced within a country in a given year.
Q: What is a recession? ANSWER A period of economic decline,
typically identified by a fall in GDP in two consecutive quarters.
Q: What is a depression? ANSWER A severe, prolonged economic
downturn.
Q: What is fiscal policy? ANSWER The government's use of taxation and
spending to influence the economy.
Q: What is monetary policy? ANSWER The management of the money
supply and interest rates by a central bank (like the Federal Reserve).
Part 2: Economics & Global Business (31-60)
Q: What is economics? ANSWER The study of how society chooses to
employ resources to produce goods and services and distribute them
for consumption.
Q: What is microeconomics? ANSWER The study of how individuals,
households, and firms make decisions under conditions of scarcity.
Q: What is macroeconomics? ANSWER The study of the broader
economy, looking at aggregate indicators like GDP, unemployment, and
inflation.
Q: What is the law of supply? ANSWER The principle that suppliers will
normally offer more for sale at higher prices and less at lower prices.
Q: What is the law of demand? ANSWER The principle that buyers will
normally buy more of a good at lower prices and less at higher prices.
Q: What is equilibrium price? ANSWER The price where the quantity
demanded by consumers equals the quantity supplied by producers.
Q: What is a surplus? ANSWER A situation where the quantity supplied
exceeds the quantity demanded.
Q: What is a shortage? ANSWER A situation where the quantity
demanded exceeds the quantity supplied.
Q: What is capitalism? ANSWER An economic system in which the
means of production are privately owned and operated for profit.
