Review Set 1

There are 6 EXTERNAL forces described in your book. What are they?

In a MARKET economy, decisions about what products are available and the price is determined by supply and demand.

____________ is the relationship between price you pay for a good/service and the benefits it gives you.

ORGANIZING is the function that organizes business operations efficiently, enabling effective use of resources.

Seeking a profit opportunity, organizing factors of production, and accepting risk is ENTREPRENEURSHIP.

The __________ is the amount of some good or service consumers are willing and able to buy at each price.

A FREE market is one where the government does not intervene.

Which mgmt. function determines how funds should be raised, the cost of borrowing, and implications of financing?

A central bank has 3 tools to implement monetary policy: open market,changing reserve req's, discount rate.

Banks serve as financial intermediaries between savers and borrowers and direct funds between the two.

Business must keep an eye on the world economy in order to adapt to changes that will impact their products/services.

_______ is a shift to an integrated world economy in which culture,ideas,beliefs,goods,resources&services are exchanged.

trick? The organization that conducts monetary policy and ensures that a nation's financial system operates smoothly is:

The most credible cryptocurrencies are based on around-the-block technology that records, validate, stores transactions.

A trade surplus occurs when a nation imports more than it exports.

When one can produce a good or service at a lower relative OPPORTUNITY COST than another, it has:

Legal tender whose value is backed by the government that issue it (i.e. US paper money) is called:

The _________ is the difference between the value of a country's imports and its exports.

Macroeconomics means how households and individuals make decisions. Microeconomics means study of economy as a whole.

Although gaining in popularity, _______ are unregulated and pose some risks to those using this medium of exhange.

The difference between a total flow of money INTO a country and the total flow of money OUT OF a country means:

Intermediate goods (like plywood or steel) that are used as inputs to other goods are NOT included in GDP calculations.

Money serves 3 functions: medium of exchange, store in a vault, unit of account.

The World Bank promotes economic and social progress in developing contries and provides low interest loans to them.

Global Trade Forces include sociocultural forces, political economies, legal differences, environment to name a few.

Business ownership in one country by an entity based in another country is known as foreign direct investment (FDI).

The _____________ says, other thins being equal, a higher price typically leads to a lower quantity demanded.

Import tariffs are taxes leveied on goods/services coming into a country.

This review covered modules:

Any natural resource, land, plants, livestock, wind, sun, water, etc. is which factor of production?

Growth is measured by GDP-the market value of final goods and services produced by the economy in a given year.

Any human service-physical or intellectual, a.k.a. human capital, is which factor of production?

A COMPETITIVE market has a large number of sellers and buyers, so no one can control the market price.

The resources we value exist in a limited supply. There's never enough to meet all needs. This is known as:

In a planned or COMMAND economy, goals come from a ruler or ruling class and resources/businesses are owned by the govt.

Equilibrium price and equilibrium quantity occur where supply and demand curves cross (one equal to the other)

A joint venture establishes a new business that is onwed by two or more otherwise independent businesses.

Resources are the inputs used to produce the outputs (goods and/or services).

A country/company is the ONLY source of a good/service OR can produce more of it than another (using same resources):

Which of these fosters global growth and economic stability by providing policy,advice,financing to members?

Examples of _______ are tangible items such as cars, televisions, or soda.

As the level of production increases (you make more), the average cost of producing each unit declines. This means:

Employees, Managers, and Owners are ___________ stakeholders?

A Not-for-Profit is operated by a board of directors, trustees, or managers.

A bond is a financial contract:the borrower will repay the amount that was borrowed with interest over a period of time.

The _______ refers to economy-wide expansions and contractions in economic activities around long-term growth trend.

Which of the following business functional areas plans, organizes, controls, and leads?

Which of the following represents the 4 functions of management?

If people/processes stray from the path, managers notice and take corrective action. This is the CONTROL function.

The social environment of a business encompasses the values, attitudes, beliefs, wants, and desires of the public.

Which function includes promoting goods/services, delivering them, developing pricing and building internet presence?

Which business functional area provides knowledge/ideas that help a company ahead of competition?

Import quotas are limits on the quantity of goods/services that can be imported into a country.

What are the 4 ways that businesses can raise financial capital?

Economists use the term ______ to mean what must be given up to get something that you desire.

A MARKET is any situation that brings together buyers and sellers of goods and/or services.

_____________ involves government spending and taxes and is determined by a nation's legislative body (Congress, etc.)

A change in DEMAND refers to a shift in the ENTIRE demand curve. The entire demand curve will shift right or left.

______________ involves bank lending interest rates, financial capital markets, activity by the Federal Reserve.

Stocks are a way to raise capital by selling ownership or equity; an investment for shareholders creating returns.

In the correct order high to low, world GDPs are:

The ___ includes everything in M1 plus near-cash items such as savings accounts, time deposits, and money markets.

Embargos are official bans on trade or other commercial activity with a particular country.

The intended goal of a business is to make a:

Resources are also called factors or production.

Which of the following business functional areas transforms resources into products/services?

The ______ says that a higher price typically leads to a higher quantity supplied.

Suppliers, society, government, creditors, shareholders, and customers are INTERNAL stakeholders.

The world's market based economies share 3 main goals: growth (GDP), high employment, price stability.

A license agreement lets someone else use the property of the licensor for a fee. (ie Star Wars logo, etc.)

Anything that is manufactured in order to be used in the production of goods and services (i.e. equipment) is called:

All funds deposited in a bank are mingled in one big pool, which is then loaned out.

The CPI market basket consists of food/beverages,housing,apparel, transportation, medical, recreation, education, other.

An individual or group that has an interest in a company, organization, or business is:

How many regional Federal Reserve Banks are responsible for supporting the commercial banks in its district?

An Initial Public Offering (IPO) is a firm's FIRST sale of stock to the public.

The study of how we make decisions in the face of scarcity is the definition of ?

Exporting means shipping your goods to another country; Importing means bringing in goods from another country.

The consumer price index (CPI) measures inflation by change in prices of a basket of goods bought by a household.

When workers focus on a task for which they have an advantage (special skill or talent), it is known as:

A _____ business provides goods/services, but profits provide a public service, advance a cause, or assist others.

The ___ money supply includes most liquid forms of money such as cash and checking account funds.

When economists talk about supply,they mean the amount of some good/service a producer wants to supply at each price.

Outsourcing contracts out a business process to another party. Offshoring relates business process to another country.

Very FEW countries' economies are evolving into a mixed-economy which has characteristics of more than one system.