Chapter 3- Business Principles and Management

Economists include government as a factor of production.

Having natural resources, labor, & capital goods are all that is needed to produce goods.

Capital goods directly satisfy human wants.

Communist countries place heavy emphasis on capital formation.

Satisfying wants involves four types of utility: time, place, possession, and ...

What normally happens during a recession?

One advantage for managers in a communist country is their freedom to decide what to produce.

If a country did not produce any capital goods, it could not produce many consumer goods.

Countries with a command economy are often dictatorships.

Inflation increases the purchasing power of money.

Privatization is when government transfers business its authority to provide goods and services

Which statement is true about capital goods?

Economic utility is one of the four types of utility that satisfy wants..

The United States has adequate resources to satisfy all the wants of all its people.

The average profit earned by a business today is about 5 percent of total receipts.

Which statement is most accurate about demand?

Form utility usually applies only to services and not to goods.

The primary incentive for a business to produce goods or services in the U.S. is profit.

What happens when a good or service is privatized?

Demand is represented by wanting an expensive leather jacket without having the money to buy it

The demand is low and supply is high for unskilled workers in most age groups.

When productive resources are used for capital formation, fewer consumer goods are produced.

Entrepreneurship is a factor of production.

Economy where the government decide what, how, and for whom goods and services are produced

When the production of consumer goods increases, the production of

Selling snow tires to a customer during the first snowstorm of the season is a time utility.

Approximately what percentage of total receipts does a business use to pay its costs?

Steel that is used to produce tools and machinery is classified as a ...

Decreased production and increased unemployment occur during recessions.