Question 1

Perfect competition is the market situation in which a product has many buyers and sellers,and no single buyer or seller is powerful enough to affect a product's price.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following represents the biggest customer of American business?

Accepted Answer

A)   Government
B)   Other businesses
C)   Foreign governments
D)   Consumers
E)   The militaryF) A) and B)
G) D) and E)

Question 3

As computers gained popularity,the ____ typewriters decreased along with the price.

Accepted Answer

A)   demand for
B)   supply of
C)   equilibrium of
D)   productivity of
E)   monopoly associated withF) A) and C)
G) A) and D)

Question 4

In a socialist economy,the key industries are owned and controlled by the government.

Accepted Answer

A) True 
 B)False  True

Question 5

The organized effort of individuals to produce and sell,for a profit,the goods and services that satisfy society's needs is called

Accepted Answer

A)   consumerism.
B)   the economy.
C)   capitalism.
D)   business.
E)   the workplace.F) All of the above
G) B) and C)

Question 6

Typical service businesses in the U.S.include real estate,repair companies,and restaurants.

Accepted Answer

A) True 
 B)False

Question 7

Adam Smith developed the concept of the invisible hand to explain how all economic activity should be based on a nation's needs and not the individual's needs.

Accepted Answer

A) True 
 B)False

Question 8

In order for a business to be successful,it must be organized,it must satisfy needs,and it must make a profit.

Accepted Answer

A) True 
 B)False

Question 9

The producer price index is an accurate predictor of

Accepted Answer

A)   future changes in the consumer price index.
B)   the level of unemployment.
C)   prime interest rates.
D)   Internet business activity.
E)   an individual's standard of living.F) C) and D)
G) A) and B)

Question 10

If the demand for a product declines,what happens to the price of the product?

Accepted Answer

A)   The price stays the same.
B)   The price decreases.
C)   The price increases.
D)   The equilibrium price will be maintained.
E)   The market price will be maintained.F) B) and C)
G) A) and D)

Question 11

____ is the process of developing and promoting the differences between one's products and other similar products.

Accepted Answer

A)   Advertising
B)   Monopolistic competition
C)   Product differentiation
D)   Branding
E)   Goods distinctionF) A) and E)
G) B) and C)

Question 12

D'Jeanea inherited money from her grandparents in 2007 and invested it in the stock market.In 2008 the market dropped drastically.During the recession that followed,her portfolio lost thousands of dollars in value even though all of the companies she invested in remained solvent.D'Jeanea left her money in the market and kept it invested in the same companies as 2007.What is the most likely state of her portfolio today?

Accepted Answer

A)   It has most likely gained value due to the uptick in the business cycle and economic growth experienced since 2011 and it is no doubt worth as much or more than it was worth in 2007.
B)   It has continued to lose value.
C)   It has grown then faltered and decreased in value due to the recovery and is most likely worth the same or less than it was worth in 2007.
D)   Since an economic recovery generally lasts an average of 24 months,her portfolio gains in value and is currently on the down-turn as the economy enters another downward cycle.E) B) and C)
F) A) and D)

Question 13

During which phase of the business cycle would a company like General Electric introduce new products?

Accepted Answer

A)   Repression
B)   Peak
C)   Recession
D)   Depression
E)   RecoveryF) B) and C)
G) A) and B)

Question 14

A natural resource,as recognized by economists,would include which of the following?

Accepted Answer

A)   Crude oil
B)   Buildings
C)   Tools
D)   Machinery
E)   EquipmentF) B) and D)
G) C) and D)

Question 15

A business' efforts to sustain the planet and their participation in ecological movements are part of a firm's

Accepted Answer

A)   free enterprise system.
B)   stakeholder responsibilities.
C)   factors of production.
D)   social responsibility.
E)   business cycle.F) B) and D)
G) A) and E)

Question 16

William and Carrie go to the local Farmer's Market every Saturday morning.The market has many vegetable stands,many flower stalls,many artisan craft stalls selling handmade soaps and scented oils,and many stalls selling yard ornaments.All of the sellers within a sales category (vegetables,flowers,artisan crafts,and ornaments) sell their goods for essentially the same price,with little variation.Carrie comments to William that the vegetable stands enjoy perfect competition.What factors did she take into consideration when making this comment?

Accepted Answer

A)   She is considering that there are many buyers and sellers of a product and no single buyer or seller is powerful enough to affect the price of that product.
B)   She is considering that there are many sellers and few buyers so the sellers set their own perfect price.
C)   She is considering that the vegetables are in perfect condition so the competition should also be perfect.
D)   She is considering that vegetables,flowers,and crafts are different products and thus one could not be substituted for another so the vegetable stands are in a perfect location with a perfect market to sell their produce.E) B) and C)
F) A) and D)

Question 17

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

Accepted Answer

A) True 
 B)False

Question 18

Capital or capital goods as recognized by economists would include all of the following except

Accepted Answer

A)   crude oil.
B)   facilities.
C)   money.
D)   machinery.
E)   computer equipment.F) B) and E)
G) A) and E) A

Question 19

The use of the factory system in the United States helped to usher in the

Accepted Answer

A)   colonial period.
B)   Industrial Revolution.
C)   Great Depression.
D)   Renaissance.
E)   twentieth century.F) A) and E)
G) A) and B) B

Question 20

____ is the study of how wealth is created and distributed.

Accepted Answer

A)   Economics
B)   Business
C)   Marketing
D)   Capitalism
E)   FinanceF) A) and E)
G) C) and D)

Exam 1: Exploring the World of Business and Economics

Perfect competition is the market situation in which a product has many buyers and sellers,and no single buyer or seller is powerful enough to affect a product's price.

Correct Answer
verified

Which of the following represents the biggest customer of American business?

Correct Answer
verified

As computers gained popularity,the ____ typewriters decreased along with the price.

Correct Answer
verified

In a socialist economy,the key industries are owned and controlled by the government.

Correct Answer
verified
True

The organized effort of individuals to produce and sell,for a profit,the goods and services that satisfy society's needs is called

Correct Answer
verified

Typical service businesses in the U.S.include real estate,repair companies,and restaurants.

Correct Answer
verified

Adam Smith developed the concept of the invisible hand to explain how all economic activity should be based on a nation's needs and not the individual's needs.

Correct Answer
verified

In order for a business to be successful,it must be organized,it must satisfy needs,and it must make a profit.

Correct Answer
verified

The producer price index is an accurate predictor of

Correct Answer
verified

If the demand for a product declines,what happens to the price of the product?

Correct Answer
verified

____ is the process of developing and promoting the differences between one's products and other similar products.

Correct Answer
verified

Correct Answer
verified

During which phase of the business cycle would a company like General Electric introduce new products?

Correct Answer
verified

A natural resource,as recognized by economists,would include which of the following?

Correct Answer
verified

A business' efforts to sustain the planet and their participation in ecological movements are part of a firm's

Correct Answer
verified

Correct Answer
verified

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

Correct Answer
verified

Capital or capital goods as recognized by economists would include all of the following except

Correct Answer
verified
A

The use of the factory system in the United States helped to usher in the

Correct Answer
verified
B

____ is the study of how wealth is created and distributed.

Correct Answer
verified

Exam 1: Exploring the World of Business and Economics

Perfect competition is the market situation in which a product has many buyers and sellers,and no single buyer or seller is powerful enough to affect a product's price.

Correct AnswerverifiedShow Answer

Which of the following represents the biggest customer of American business?

Correct AnswerverifiedShow Answer

As computers gained popularity,the ____ typewriters decreased along with the price.

Correct AnswerverifiedShow Answer

In a socialist economy,the key industries are owned and controlled by the government.

Correct AnswerverifiedTrue

The organized effort of individuals to produce and sell,for a profit,the goods and services that satisfy society's needs is called

Correct AnswerverifiedShow Answer

Typical service businesses in the U.S.include real estate,repair companies,and restaurants.

Correct AnswerverifiedShow Answer

Adam Smith developed the concept of the invisible hand to explain how all economic activity should be based on a nation's needs and not the individual's needs.

Correct AnswerverifiedShow Answer

In order for a business to be successful,it must be organized,it must satisfy needs,and it must make a profit.

Correct AnswerverifiedShow Answer

The producer price index is an accurate predictor of

Correct AnswerverifiedShow Answer

If the demand for a product declines,what happens to the price of the product?

Correct AnswerverifiedShow Answer

____ is the process of developing and promoting the differences between one's products and other similar products.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

During which phase of the business cycle would a company like General Electric introduce new products?

Correct AnswerverifiedShow Answer

A natural resource,as recognized by economists,would include which of the following?

Correct AnswerverifiedShow Answer

A business' efforts to sustain the planet and their participation in ecological movements are part of a firm's

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Capital or capital goods as recognized by economists would include all of the following except

Correct AnswerverifiedA

The use of the factory system in the United States helped to usher in the

Correct AnswerverifiedB

____ is the study of how wealth is created and distributed.

Correct AnswerverifiedShow Answer

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True

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A

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B

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