Business 101: Exam 1 Questions with Complete Solutions 100% Solved| Grade A+
Examples of ways to increase resources new energy sources, new ways of growing foods,
new ways of creating goods and services
Who is the father of economics? Adam Smith
Invisible Hand When self-directed gain leads to social and economic benefits for the whole
community. (Ex. a farmer sells his crops to the community to feed off of)
Capitalism An economic system based on private property and free enterprise. (United
States, England, Australia)
State Capitalism When the state, rather than private owners, run some businesses.
Capitalism's Four Basic Rights: 1. The right to own private property
2. The right to own a business and keep all that business's profits
3. The right to freedom of competition
4. The right to freedom of choice
Roosevelt's Four Additional Freedoms 1. Freedom of speech and expression
2. Freedom to worship in your own way
3. Freedom from want
4. Freedom from fear
What are the two major economic systems: Free Market and Command
, Free Markets Decisions about what and how much to produce are made by the market.
Command Economics: The government largely determines what goods and services are
produced, who gets them, and how the economy will grow.
Supply The quantity of something that producers have available for sale
Demand the quantity of a good or service that consumers are willing and able to buy
Market Price (Equilibrium Point) Determined by supply and demand, this is the negotiated
price.
Four Degrees of Competition: 1. Perfect Competition
2. Monopolistic Competition
3. Oligopoly
4. Monopoly
Free Market Benefits and Limitations B: Allows for open competition and provides
opportunities for poor people to work
L: People may start to let greed drive them
Socialism A system in which society, usually in the form of the government, owns and
controls the means of production. (Entrepreneurs run small businesses)
Benefits of Socialism: Social equality, free education & healthcare/childcare, longer
vacations, shorter work weeks, generous sick leave
Examples of ways to increase resources new energy sources, new ways of growing foods,
new ways of creating goods and services
Who is the father of economics? Adam Smith
Invisible Hand When self-directed gain leads to social and economic benefits for the whole
community. (Ex. a farmer sells his crops to the community to feed off of)
Capitalism An economic system based on private property and free enterprise. (United
States, England, Australia)
State Capitalism When the state, rather than private owners, run some businesses.
Capitalism's Four Basic Rights: 1. The right to own private property
2. The right to own a business and keep all that business's profits
3. The right to freedom of competition
4. The right to freedom of choice
Roosevelt's Four Additional Freedoms 1. Freedom of speech and expression
2. Freedom to worship in your own way
3. Freedom from want
4. Freedom from fear
What are the two major economic systems: Free Market and Command
, Free Markets Decisions about what and how much to produce are made by the market.
Command Economics: The government largely determines what goods and services are
produced, who gets them, and how the economy will grow.
Supply The quantity of something that producers have available for sale
Demand the quantity of a good or service that consumers are willing and able to buy
Market Price (Equilibrium Point) Determined by supply and demand, this is the negotiated
price.
Four Degrees of Competition: 1. Perfect Competition
2. Monopolistic Competition
3. Oligopoly
4. Monopoly
Free Market Benefits and Limitations B: Allows for open competition and provides
opportunities for poor people to work
L: People may start to let greed drive them
Socialism A system in which society, usually in the form of the government, owns and
controls the means of production. (Entrepreneurs run small businesses)
Benefits of Socialism: Social equality, free education & healthcare/childcare, longer
vacations, shorter work weeks, generous sick leave
