Exam 1: The Foundations of Business

Asset-producing resources are the outputs used to produce inputs in a business.

The three goals shared by all of the world's economies are growth, high employment, and price stability.

Lagging economic indicators report the status of the economy for periods of a _____ in the past.

SCENARIO-BASED New Age Pharmaceuticals Inc. produces two limited lines of drugs—one for common maladies and one for rarer conditions and diseases. The majority of its business comes from the tried-and-true drugs that most Americans have been using for many years, but the new growth area in the pharmaceutical industry is in high-priced new drugs. New Age management believes that the company’s research-and-development operations are sufficiently effective and efficient enough to develop six new prescription drugs that will start showing a profit within 12 months of their roll-outs. Currently more than 4 million people use New Age products. -In researching the quantity of medicines that customers are willing to purchase at various prices, New Age management will actually be researching demand.

When people have more discretionary money to eat out at restaurants and cafeterias, it's a sign that the _____ is strong.

_____ involve(s) planning, organizing, directing, and controlling a company's resources so that it can achieve its goals.

Published by a private research firm called the Conference Board, the _____ is a measure that combines all useful economic indicators.

_____ occurs when the average of the prices for goods and services either does not change or changes very little.

To start a business, you must have all of the following except _____

The United States federal government influences economic activity by two means, including _____.

The difference between the revenue that a company brings in from selling goods and services and the cost of generating this revenue is called _____.

The economic system with the highest level of government control is communism.

One way that economists measure the performance of an economy is by looking at a widely used measure of total output know as the _____.

_____ refers to the quantity of a product that buyers are willing to purchase at various prices.

Price stability occurs when the average of the prices for goods and services does not change much; when they go up, we experience inflation.

A recession is generally followed by a _____ in which the economy starts growing again.

Which of the following is not a characteristic of a business

When the United States experiences a slowdown in economic activity and GDP goes down for two consecutive quarters, it is called a(n) _______.

When the Fed believes that inflation is a problem, it will use _____ policy to decrease the money supply and raise interest rates.

Differentiated products are those that serve several different purposes for different consumers.