Economics Unit 2 Practice for Test

Private ownership increases pride in taking care of their property.

A franchisee is

Private ownership does not

Consumer sovereignty guides the market for

Businesses must constantly examine the costs of production to maximize profit.

In the circular flow, firms receive money from the _______________for their merchandise.

Households provide the demand for the factor market.

When there is an easy in and out of industries competition is more likely to occur.

The ability to attract capital investment is readily found in corporations.

When the expected benefit exceeds the expected cost, the behavior will continue.

A key characteristic of sole proprietorship includes:

Payments that firms makes to the factor market include:

The economic system that is focused on income as its main goal:

Household provide the supply and demand for both the factor and goods and services markets.

In the circular flow diagram, firms incur costs from the __________market.

Owning your own business can create

Who usually pays for the results of externalities?

In the circular flow diagram, firms receive _______from the factor market.

Banks are more likely to lend money to

Double taxation is a drawback of sole proprietorship.

An advantage of corporations includes limited liability.

If the revenue for 1,500 units is $16,000 and the cost was $15,000, the profit is:

Franchises have little to no start up costs.

Monetary incentives include

Corporations get to avoid double taxation.

Unlimited liability is a disadvantage of a sole proprietorship.

In the circular flow, businesses and firms give what to the government?

Economic incentives can be

Businesses are sellers in the ___________market.

In the circular flow, the factor market is where

There is no change in control of a corporation if a stockholder owns over 50% of the stock.

When profits are increased, we expect that more firms will enter the industry.

The factors of production do not include:

Disadvantages of partnerships include:

Households provide the factors for the factor market.

Businesses provide the supplies for the product market.

An economic incentive includes:

The formula for profit includes:

Price, wages, and profits are all