LHR 427 Exam 1 Questions and Answers Fully Solved
demand - Answers How many products are consumers willing to purchase at different prices at a specific
time?
supply - Answers How many products are businesses willing to sell at different prices at a specific time?
revenue - Answers The total amount of money a business takes in during a given period by selling goods
and services.
profit - Answers The amount of money a business earns above and beyond what it spends for salaries
and other expenses.
loss - Answers When a business's expenses are more than its revenues.
for-profit organizations - Answers ¤Aim at maximization of profits for their shareholders
nonprofit organizations - Answers ¤Have a social mission
¤Do not aim at creating profit for their owners
¤Typically receive governmental funds, donations, and grants
social enterprises - Answers ¤Have a dual mission: social and commercial
¤Profits generated are used to support their social mission
¤E.g., TOMS shoes
How do we identify the equilibrium price and the equilibrium quantity? - Answers The price at which:
number of products businesses are willing to supply = the number of products consumers are willing to
purchase at a specific time
What is required to make profit? - Answers Adapting to Change
Acting Ethically
Abiding by the Law
Marketing Expertise
Management Skills
Financial Resources
Who is an entrepreneur? - Answers Someone who assumes the risk of starting a business
What is the risk associated with entrepreneurship? - Answers The chance an entrepreneur takes of
losing time and money on a business that may not prove profitable.
,What are some advantages of being an entrepreneur? - Answers ¤Freedom to succeed
¤Make your own decisions
¤Possible wealth
¤Sense of self-actualization
What are some disadvantages of being an entrepreneur? - Answers ¤Freedom to fail
¤No paid vacations
¤No health insurance
¤Responsible for others' welfare
¤Ego depletion
¤Personal sacrifices
standard of living - Answers ¤The amount of goods and services people can buy with the money they
have.
quality of life - Answers ¤The general well-being of a society in terms of its 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 - Answers ¤All the people or, in general, entities who stand to gain or lose by the policies
and activities of a business and whose concerns the business needs to address.
shareholders - Answers ¤All the people or, in general, entities who own a part pf a publicly traded firm
via a share or stock.
Who are some of the core stakeholders in a typical U.S. business? - Answers stockholders
customers
surrounding community
environmentalists
dealers
employees
government leaders
suppliers
, media
bankers
What is outsourcing? - Answers ¤Contracting with other companies (often in other countries) to do
some of the functions of a firm, like production or accounting.
advantages of outsourcing - Answers Access talent
Reduce operating costs
Focusing on core business/freeing up talent
disadvantages of outsourcing - Answers Disadvantages
Reduced control over quality of work or even the working conditions
Substandard work à more expensive to fix
Disconnect among employees/department
Lack of coherent culture
What are the five elements of the business environment? - Answers economic and legal
technological
competitive
social
global
economic and legal - Answers freedom of ownership, contract laws, elimination of corruption, tradable
currency, minimum taxes and regulation
technological - Answers ¨Information technology
¤Assists in decision making
¨Databases
¤Storing information
¤The issue of big data
¨Bar codes
¤Easier tracking of products and their information
demand - Answers How many products are consumers willing to purchase at different prices at a specific
time?
supply - Answers How many products are businesses willing to sell at different prices at a specific time?
revenue - Answers The total amount of money a business takes in during a given period by selling goods
and services.
profit - Answers The amount of money a business earns above and beyond what it spends for salaries
and other expenses.
loss - Answers When a business's expenses are more than its revenues.
for-profit organizations - Answers ¤Aim at maximization of profits for their shareholders
nonprofit organizations - Answers ¤Have a social mission
¤Do not aim at creating profit for their owners
¤Typically receive governmental funds, donations, and grants
social enterprises - Answers ¤Have a dual mission: social and commercial
¤Profits generated are used to support their social mission
¤E.g., TOMS shoes
How do we identify the equilibrium price and the equilibrium quantity? - Answers The price at which:
number of products businesses are willing to supply = the number of products consumers are willing to
purchase at a specific time
What is required to make profit? - Answers Adapting to Change
Acting Ethically
Abiding by the Law
Marketing Expertise
Management Skills
Financial Resources
Who is an entrepreneur? - Answers Someone who assumes the risk of starting a business
What is the risk associated with entrepreneurship? - Answers The chance an entrepreneur takes of
losing time and money on a business that may not prove profitable.
,What are some advantages of being an entrepreneur? - Answers ¤Freedom to succeed
¤Make your own decisions
¤Possible wealth
¤Sense of self-actualization
What are some disadvantages of being an entrepreneur? - Answers ¤Freedom to fail
¤No paid vacations
¤No health insurance
¤Responsible for others' welfare
¤Ego depletion
¤Personal sacrifices
standard of living - Answers ¤The amount of goods and services people can buy with the money they
have.
quality of life - Answers ¤The general well-being of a society in terms of its 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 - Answers ¤All the people or, in general, entities who stand to gain or lose by the policies
and activities of a business and whose concerns the business needs to address.
shareholders - Answers ¤All the people or, in general, entities who own a part pf a publicly traded firm
via a share or stock.
Who are some of the core stakeholders in a typical U.S. business? - Answers stockholders
customers
surrounding community
environmentalists
dealers
employees
government leaders
suppliers
, media
bankers
What is outsourcing? - Answers ¤Contracting with other companies (often in other countries) to do
some of the functions of a firm, like production or accounting.
advantages of outsourcing - Answers Access talent
Reduce operating costs
Focusing on core business/freeing up talent
disadvantages of outsourcing - Answers Disadvantages
Reduced control over quality of work or even the working conditions
Substandard work à more expensive to fix
Disconnect among employees/department
Lack of coherent culture
What are the five elements of the business environment? - Answers economic and legal
technological
competitive
social
global
economic and legal - Answers freedom of ownership, contract laws, elimination of corruption, tradable
currency, minimum taxes and regulation
technological - Answers ¨Information technology
¤Assists in decision making
¨Databases
¤Storing information
¤The issue of big data
¨Bar codes
¤Easier tracking of products and their information
