Exam 1: Exploring the World of Business and Economics

The Hamel family owns and operates an interior decorating business. Greg installs hardwood floors and chair rails; Stephanie reupholsters furniture and takes care of the finances; Ryan designs and makes draperies and pillows; and Allison coordinates the overall color, look, and design. The process the Hamel family uses to run its business is

Satellite Communications Jonathan worked for Satellite Communications for twenty years. In the time that he worked there, he learned a lot about the company and how it operated. The company met its sales and revenue goals every year. However, most of the employees had similar educational and cultural backgrounds. He believed that the company could do much better if it cultivated an environment that promoted many different ideas. Additionally, Satellite Communications was mostly focused on how much revenue it earned in a given year. Jonathan felt that the most important goal should be to satisfy customers. He believed financial success would result from focusing on customers. After a lot of consideration, Jonathan decided to open his own business called Universal Communications and hire employees that reflected a more diverse customer base. He was happy to have this opportunity because it was a dream that he had always had. He had always wanted to make his own decisions about what his company would produce and how. The only aspect of the business he was unsure of was pricing, yet he knew this would be important for his ultimate success. -Refer to Satellite Communications. Jonathan's success will contribute to society. This is referred to as the

The term stakeholders refers only to the people who have invested money in a business.

Deflation

Satellite Communications Jonathan worked for Satellite Communications for twenty years. In the time that he worked there, he learned a lot about the company and how it operated. The company met its sales and revenue goals every year. However, most of the employees had similar educational and cultural backgrounds. He believed that the company could do much better if it cultivated an environment that promoted many different ideas. Additionally, Satellite Communications was mostly focused on how much revenue it earned in a given year. Jonathan felt that the most important goal should be to satisfy customers. He believed financial success would result from focusing on customers. After a lot of consideration, Jonathan decided to open his own business called Universal Communications and hire employees that reflected a more diverse customer base. He was happy to have this opportunity because it was a dream that he had always had. He had always wanted to make his own decisions about what his company would produce and how. The only aspect of the business he was unsure of was pricing, yet he knew this would be important for his ultimate success. -Refer to Satellite Communications. Now that Jonathan plans to open his own business, he needs to look at the factors of production. Which of the following is not a factor of production?

The purpose of specialization is to

Susan Montgomery works at an institutional bakery and is paid a wage dictated by the government. She does not like her job but is not allowed other options. Susan must purchase necessities for her family at fixed prices. The country Susan lives in can be described as a ____ economy.

When a firm's sales revenues are greater than its expenses, the firm has a

Productivity is the total output per worker per year.

Researchers just released the results of a study that shows much of the shellfish eaten in the United States contains chemicals that some consider unsafe for consumption. What will likely result from this new information?

During which phase do high unemployment rates decline and levels of income increase?

A price at which the demanded quantity is equal to the produced quantity of that product is called the ____ price.

____ is a market situation (or industry) in which there are few sellers.

How does a monopoly have complete control over the price of its product?

In our free-enterprise system, federal and state governments decide what products and services to provide.

The recurrence of periods of growth and recession in a nation's economic activity is a depression.

As a farmer, Gary Forsythe is familiar with the economics of perfect competition. How is the price at which he sells his corn determined?

Mondell Weller decides to start a residential landscaping business. How would this business most likely be classified?

According to economists, inflation is

Which of the following statements does not describe the U.S. economy as we finish the first decade of the new millennium?