Entrepreneurs
What should a person starting a new business expect to happen as an entrepreneur?
They will work long hours, spend a lot of their money, and take a lot of risks.
Which expense does not change week to week or month to month? An example would be a car or house payment.
Fixed expense
What are the four ways companies compete?
Price incentive, quality, customer service, advertisements
What are the roles of the household sector of the economy? (2 answers)
Selling their labor for income, buying the goods and services from the businesses
Who pays taxes to the government? (2 answers)
Households and Private Businesses
What is an entrepreneur?
A person or group of people who take risks to develop new goods and services to start a business.
What are the three elements to a personal budget?
Income, expenses, and savings
Why is competition beneficial to the consumer?
It will often result in lower prices and better quality. The consumer gets to pick where to shop.
Households sell their labor in return for what?
Income
The government uses taxes for what?
Why might an entrepreneur start a new business?
To provide a new good or service that people want and to make a profit.
What does it mean to 'make ends meet'?
To have enough money to pay all your expenses.
What is competition in a market economy?
When similar businesses try to have the lowest prices and best quality to attract the consumer.
Private businesses sell goods and services for profit. What is a profit?
Money made after all expenses are paid
What are the 3 things that banks provide?
Checking account, savings account, loans
True or false: All entrepreneurs will be successful as long as they work hard.
False: Not all entrepreneurs are successful even if they work hard. Sometimes people do not like their idea.
What is an expenditure?
Money spent on a good or service.
What is specialization?
When a company focuses on one product to make it the best version it can be. Typically, companies are known for this product.
What is a private business?
A company created by a person or small group of people. It is not owned by the governemnt.
Susie took out a loan from the bank to buy a car. When she repays that loan, she should expect to pay back the loan plus what?
Interest
What is NOT a characteristic of an entrepreneur?
Poor communication, give up easily, lack creativity
If your expenses are higher than your income, what should you do?
Find ways to reduce your expenses or increase your income to balance your budget.
What happens to a company if they make the price of a product too low?
They will fail to make a profit on that product
What is a human resource?
People who provide their labor to a business to sell goods and services.
How do the banks earn money?
They charge interest on loans