Exam 1: The Foundations of Business

Economists study the interactions between households and businesses and look at the ways in which the factors of production are combined to produce the goods and services that people need.

The economic system of a country is the means by which a society makes decisions about allocating resources to produce and distribute products.

The planned market system was espoused by Adam Smith in his book The Wealth of Nations, published in 1776.

Generally speaking, economic systems can be divided into _____ and _____ systems.

Under _____ competition, many sellers sell differentiated products that serve similar purposes.

As a functional area of business, what does the accounting section do

In practice, we have "full employment" when about 95 percent of those desiring to work are employed.

Currently, the U.S. national debt is approximately _____.

The inflation rate is the percentage change in a price index.

How do economists study the interactions between households and businesses

One useful indicator of the outlook for future jobs is the number of new _____.

The equilibrium price is a point at which buyers' demand for a product and sellers' supply of it are in balance.

Indicators that predict economic decline over periods of three to twelve months are called lagging economic indicators.

SCENARIO-BASED Soup, Salad, & Sandwich is a regional chain of restaurants in the northeast that provides dine-in, carry-out, and catering services. Owners Jesse and Mataya Peña currently operate six locations and are in the process of opening a new restaurant in another state. Their operation is quite successful and appeals to health-conscious consumers, busy moms, and executives in a hurry. Staying open longer hours, enlarging the menu, and expanding the scope of the business are among the many goals set by the Peñas. They want to follow a traditional business model in reaching their goals. -Soup, Salad, & Sandwich features all of the traditional business participants except _____.

The free market system was espoused by _____ in his book The Wealth of Nations.

An economic indicator is a statistic that provides valuable information about the economy.

A classic example of a company with a patent-based legal monopoly is Polaroid, which for years held exclusive ownership of instant-film technology.

A typical business cycle can last much longer than three to five years.

A supply curve shows the relationship between the:

SCENARIO-BASED Soup, Salad, & Sandwich is a regional chain of restaurants in the northeast that provides dine-in, carry-out, and catering services. Owners Jesse and Mataya Peña currently operate six locations and are in the process of opening a new restaurant in another state. Their operation is quite successful and appeals to health-conscious consumers, busy moms, and executives in a hurry. Staying open longer hours, enlarging the menu, and expanding the scope of the business are among the many goals set by the Peñas. They want to follow a traditional business model in reaching their goals. -The Peñas hire a manager for each restaurant and assign specific goals and responsibilities. Each manager will perform each of the traditional management functions except _____.