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Economics Ch7 and 8 BJU Flashcards | StudBud
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Economics Ch7 and 8 BJU
Economics Ch7 and 8 BJU
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Answers
1
A bear market is one in which the market in rising.
False
True
2
Partnerships have a definite advantage over sole proprietorships in finding financial sources.
True
False
3
What is the primary advantage of partnerships over sole proprietorships?
greater flexibility
greater longevity
greater financial resources
greater liability protection
4
The DJIA consists of fifty companies.
True
False
5
A subchapter S corporation must have fewer than twenty-five shareholders.
False
True
6
The NASDAQ is famous for having no trading floor.
False
True
7
Legally, partnerships always require a written contract.
True
False
8
What book of the Bible gives much advice about personal financial practices?
Ecclesiastes
Proverbs
Colossians
Ruth
9
If a corporation files for bankruptcy and sells all its assets, who would last receive payment from the proceeds?
preferred share holders
common stock holders
employees
creditors
10
The fact, spending on services constitutes the majority of US consumer spending makes which of the following important?
NASDAQ
DJIA
S & P 500
NYSE
11
A cosigner is someone whom a debt is owed.
True
False
12
Charles Dow invented the first stock index.
True
False
13
Which business type gives its owner/s the most freedom?
general partnership
corporation
limited liability company
sole proprietorship
14
Limited liability companies are ruled by a board of directors.
True
False
15
The stock exchange famous for having no "floor" is
Amex
the NASDAQ
the London Stock Exchange
the NYSE
16
Many law and accounting firms use the partnership model because of its ability to
retain competent employees
expand sources of financing
remain easy to form and manage
acquire greater management skills
17
The most popular business model in the United States today is the partnership.
False
True
18
What is the term for a corporation's first sale of stock?
initial public offering
preliminary stock option
preferred stock
common stock
19
Which of the following is not an accurate criterion for an LLC?
governed by an operating agreement
no more than fifty shareholders
foreign partners allowed
no regular shareholder meetings required
20
Which of the following is not a question that a general partnership contract must answer?
How are the profits to be divided?
What is each partner responsible to do?
How may a partner withdraw from the partnership?
What is the limit of each partners liability?
21
Corporations can usually get better loans than partnerships.
True
False
22
Shares of stock are portions of the profit of a company.
False
True
23
The stock market crash of 1929 was a result of
an economic recession
a run on the banks
a speculative bubble
a collapse in supply
24
Which of the following is considered the best health indicator of American industry?
S & P 500
Amex
NYSE
DJIA
25
A limited partner can lose only what he originally invested in a company.
True
False
26
The most popular business model in the US today is?
the corporation
the sole proprietorship
the partnership
the limited liability company
27
According to the text, corporations' complex organizational structures can sometimes lead to accusations of
a waste of financial resources
an inability to respond to the market
an obsession with rules and hierarchy
an overemphasis on performance
28
The NYSE was the first American stock exchange.
False
True
29
The primary purpose of a stock index is to
predict economic recessions
track prices in an economy
identify the most profitable companies
identify trends in an industry
30
Mutual funds are privately managed stock portfolios.
False
True
31
What important business factor can sole proprietorships protect better than corporations can?
information
customers
financial resources
competition
32
According to the text, what disadvantage often results from corporations' great size?
impersonality
over employment
low quality
inefficiency
33
The stock market tape is where stock transactions are posted.
False
True
34
In the eyes of the law, a corporation possesses which two important qualities?
immortality and taxability
liability and taxability
flexibility and profitability
individuality and immortality
35
The greatest weakness of the partnership and the sole proprietorship is their limited management skills.
True
False
36
What is currently the most reputable stock exchange in the world?
NYSE
NASDAQ
London Stock Exchange
Amex
37
Stock markets are important to many Americans' retirement planning.
True
False
38
Stockholders can be called to vote on
electing a board of directors
expanding into a new market
hiring or firing a manager
all of the above
39
Which statement best summarizes JC Penney's business philosophy?
The customer is always right
A penny saved is a penny earned
He that is master of himself will soon be master of others
Do unto others as you would have them do unto you
40
Which of the following was founded by Charles Dow and Edward Jones?
the Washington Post
the Wall Street Journal
the New York Times
the Boston Globe
41
Corporations' complex organizational structure can cause slow response to the market.
False
True
42
Investing in the stock market is no different than gambling.
False
True
43
What is the chief advantage of incorporating a company?
freedom from excessive taxes
limited personal liability
secrecy and business information
ease of formation
44
Which of the following is not considered to be a benefit of preferred stock?
preferred receive compensation before common stockholders if a company fail
It carries less risk of loss
It gives the right to vote on company matters
Preferred stockholders receive dividends before common stockholders
45
The SEC was founded following which important historical event?
The Panic of 1837
The Great Depression
the American Civil War
World War II
46
Corporations' great size can make workers feel unimportant.
False
True
47
Stock exchanges first appeared in France and Austria.
False
True
48
IPOs are often less than half of a company's stock.
True
False
49
What great risk balances out the many advantages of both the sole proprietorship and the partnership models?
lack of accountability
limited management skills
unlimited financial liability
lack of independence
50
Charles Dow began his stock index with one hundred companies.
True
False
51
Approximately one-half of all new businesses fail within five years.
True
False
52
Historically, sole proprietorships have the shortest lifespan of the three business types.
False
True
53
The first American stock exchange was located in
New York City
Washington, DC
Boston
Philadelphia
54
A business with fewer than thirty-five shareholders can incorporate as a(n)
limited liability corporation
amendment C corporation
limited partnership corporation
subchapter S corporation
55
The most prevalent type of stock is preferred stock.
False
True
56
Stockholders usually have no say in how the business is run.
False
True
57
A corporation is more likely to obtain low-interest loans than a partnership.
False
True
