Economics correct answers the study of how resources are distributed for the production of goods and services within a social system
Inflation correct answers a condition characterized by a continuing rise in prices
Equilibrium price correct answers the price at which the number of products t...
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Economics correct answers the study of how resources are distributed for the production of goods and services within a social system
Inflation correct answers a condition characterized by a continuing rise in prices
Equilibrium price correct answers the price at which the number of products that businesses are willing to supply equals the amount of products that consumers are willing to buy at a specific point in time.
What is the common goal of all businesses? correct answers to earn a profit
What is a product? correct answers a good or service with tangible and intangible characteristics that provide satisfaction and benefits
What are the factors of production? correct answers natural, human, and financial resources that are used to produce goods and services
What is the risk taken by owners of a business? correct answers They risk losing the assets they put into the company, principle, and they risk their business failing.
What are the advantages of a corporation? correct answers Limited liability (stockholders are not held responsible for firm's debts), Ease of transfer of ownership (can sell or trade shares of stock easily without causing termination of corporation), Perpetual life (company chartered to last forever), external sources of funds (easiest type of business to earn money), expansion potential (easily expand into national and international markets)
What are the disadvantages of a corporation? correct answers Double taxation (the corporation and individual owner taxed), Forming a corporation (can be costly), Disclosure of information (corporations must make information available to their owners,
usually on an annual basis), Employee-Owner separation (many employees are not stockholder of the company for which they work)
What are the advantages of a sole proprietorship? correct answers Ease and cost of formation (is easy and inexpensive), Secrecy (does not have to discuss opening operating plans), Distribution and use of profits (all profits go to owner), Flexibility and control of the business (owner has complete control over business), Government regulation (have most freedom from government regulation), Taxation (profits considered personal income tax and are taxed at individual rates), Closing the business (can be dissolved easily)
What are the disadvantages of a sole proprietorship? correct answers Unlimited liability for debts of business, Limited sources of funds (have fewer sources of funds), Limited skills (owner must be able to perform many functions), Lack of continuity (expectancy of company is directly linked to that of the owner and his or her ability to work), Lack of qualified employees (can't offer high wages like other businesses), taxation (pay a higher marginal tax rate than do small corporations on income less than 75,000
What are the advantages of a partnership? correct answers Ease of organization (just draw up articles of partnership), Availability of Capital and credit (pooled financial resources), Combined knowledge and skills (more people mean more knowledge), Decision making (can make quick decisions), regulatory controls (has fewer regulatory controls than a corporation)
What are the disadvantages of a partnership? correct answers Unlimited liability (partners have unlimited liability for the debts incurred), Business responsibility (one person could make a bad decision that affects everyone), Life of partnership (partnership is terminated when a partner dies or withdraws), Distribution of profits, Limited sources of funds
What is the true definition of a small business? correct answers any independently owned and operated business that is not dominant in its competitive area and does not employ more than 500 people
What is the Small Business Administration? correct answers an independent agency of the federal government that offers managerial and financial assistance to small businesses; outlines the first steps in starting a small business and offers a wealth of information to current and potential small-business owners
What are tasks related to organizing? correct answers organizing is the structuring of resources and activities to accomplish objectives in an efficient and effective manner. Managers organize by reviewing plans and determining what activities are necessary to implement them, then they divide the work into small units and assign it to specific individuals, groups, or departments
What is free-rein leadership? correct answers leaders let their employees work without much interference. The manager sets performance standards and allows employees to find their own ways to meet them. It demonstrates a great deal of confidence and trust in the employee.
What is the definition or description of an organization structure? correct answers system used to define a hierarchy within an organization. It identifies each job, its function and where it reports to within the organization.
What are the advantages and disadvantages of a line structure? correct answers Adv--It
has a clear chain of command, which enables managers to make decisions quickly
Disadv.--It requires that managers possess a wide range of knowledge and skills and are responsible for a variety of activities and must be knowledgeable about them all.
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