Exam 2: Understanding Economics and How It Affects Business

Meredith notices that just a few big companies produce most of the flavored teas she sees in the grocery store. She would be correct in describing the flavored tea industry as an oligopoly.

Colby is a new college graduate who just started a job as an engineering trainee for a sizeable defense company. Now that he is earning good money, he hopes to start saving for his first house and also make contributions to his retirement plan. As he looks over his monthly bills, Colby is concerned that he'll never get ahead of the game. His grocery bill, car payment, and mounting gas payments keep him in the "just making ends meet" group. As his mind wonders back to his college days, he reflects on a time when gas and food seemed a lot more reasonable. Chase is experiencing the effects of

Socialism and communism are both variations of a free-market economy.

Economists refer to a market in which a few sellers dominate the supply side as monopolistic competition.

Incentive to own and operate businesses is high in nations whose governments are proponents of socialistic practices.

History shows that free-market capitalism leads to a fair and equitable distribution of wealth.

Dan and Susan Greene are purchasing their first home in Savannah, Georgia. They are seeking pre-qualification on a home loan. The unemployment rate for Georgia is 10.2% and GDP is declining. Chances are pretty good that the Fed will raise interest rates in order to loosen the supply of money, resulting in a more expensive loan for Dan and Susan.

Thomas Malthus believed that overpopulation was a major cause of poverty.

Ben recently lost his job at a major U.S. auto plant in one of the rust belt states. After looking unsuccessfully for work in a similar industry for several months, he plans to start interviewing with road and bridge repair companies. He speculates that if the government begins to contract with companies that repair highways and bridges, he may find steady work, at least in the short term. Which of the following statements best describes the strategy behind his thoughts?

If nearly 28% of Cashland's citizens under the age of 65 are without healthcare and an advocacy group convinces its current administration to vote for basic healthcare for everyone, which of the following is likely to occur?

As indicated by the "World Population is Popping" box, the predicted population increase in some of the world's poorest countries will present economic challenges.

Over dinner with his friend Nathan, Dominic complained about how prices have increased a great deal over the past year. Nathan disagreed and said that the prices of some goods have gone up a bit, but other prices have declined, noting that you can get some good buys on houses right now. Nathan feels that the average price of consumer goods hasn't changed. Nathan and Dominic can refer to the ________ to learn how government economists currently view the price situation.

Cooper recently saw a report online that the Fed will try to help get the U.S. economy back on track. If the Fed takes action, Cooper would likely see

The Federal Reserve Bank operates

Resource development is concerned with finding the best way to utilize the fixed amount of resources a society has available.

According to the box, "Bad Medicine for Consumers?" the hypothetical pharmaceutical firm you work for recently increased the price of a chemotherapy drug from $300 to $3,000! What concern associated with capitalism best illustrates this ethical dilemma?

An increase in productivity means that a worker is now able to produce more goods and services in the same amount of time.

Which of the following statements about capitalism is the most accurate?

If businesses are producing at capacity, and the nation is experiencing almost full employment (a very low rate of unemployment-less than 2%), the Fed may decide to

The economic and political system in which the government owns almost all the major factors of production is called