Exam 1: The Foundations of Business

In marketing, supply and demand interact to create a(n) _____price-the price at which buyers are willing to purchase the amount that sellers are willing to sell.

Businesses are more willing to sell a product when the price _____ and less willing to sell it when prices _____.

Every business must have one ____, whose primary role is to infuse money into the business.

Ultimately, the goal of any business is to satisfy the needs of its owner.

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

General Motors operates several divisions in supplying cars, trucks, vans, and SUVs to its customers. Each division engages the usual business participants, overlaps management functions with other divisions, and works in basically the same functional areas as all of the others. Chevrolet, Pontiac, Oldsmobile, Cadillac, Saturn, and GMC trucks are among the company’s product lines. Its few major competitors include Ford, DaimlerChrysler, Nissan, Honda, and Toyota. Each automaker sells a large portion of all the products sold in the marketplace, and each differentiates its product lines. -If the automobile industry included many rather than few manufacturers of differentiated their products, we might conclude that it was characterized by _____ conditions.

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

If the government spends more than it takes in, we have a budget _____.

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

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. -Mataya is good at summarizing and communicating financial and other information to Jesse and the other restaurant managers. Which functional area is her specialty

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

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. -An exception to the New Age demand curve may occur if diabetes patients are willing to pay the price for an effective new drug regardless of the supply that New Age makes available.

When sellers supply more of the product than buyers are willing to purchase, a ______ is created.

General Motors operates several divisions in supplying cars, trucks, vans, and SUVs to its customers. Each division engages the usual business participants, overlaps management functions with other divisions, and works in basically the same functional areas as all of the others. Chevrolet, Pontiac, Oldsmobile, Cadillac, Saturn, and GMC trucks are among the company’s product lines. Its few major competitors include Ford, DaimlerChrysler, Nissan, Honda, and Toyota. Each automaker sells a large portion of all the products sold in the marketplace, and each differentiates its product lines. -The industry conditions under which GM competes could not be characterized as _____.

Under a socialist economic system, the government owns all or most businesses.

When they assess the success of plans and decisions and take corrective action when it's needed, managers are _______.

While financial accountants prepare financial statements to help users both inside and outside of the organization, managerial accountants prepare reports for internal users only.

A demand curve shows the _____ of a product that will be demanded at different prices.

Under a system characterized by _____ competition, there are many consumers buying a standardized product from numerous small businesses.