PIs 1
Define the concept of opportunity cost.
Opportunity cost is the value of the forgone alternative action or decision? That is, opportunity cost is the loss of potential gain from other alternatives when one alternative is chosen?
Name the four main types of economic systems
Traditional, market, command, and mixed?
Two years ago, Tommy borrowed $12,500 from his bank to purchase a new car. Unfortunately, he lost his job about a year ago, and he hasn't been able to make a payment on the loan for 6 months. As a result, the bank is taking steps to seize his car. This is called a ...
A. foreclosure. B. debt consolidation. C. forbearance. D. repossession.
What is Repossession?
When a borrower defaults (fails to pay for an extended period of time) on their loan, the lender— in this case, Tommy's bank—may choose to claim the collateral—Tommy's car—that was used to secure the loan.
To be an effective team member, an employee needs to be willing to
A. collaborate with others.
B. take on all jobs.
C. provide insensitive feedback.
D. withhold their opinions.
What is Collaborate with others?
Effective team members must be willing to help, work well with, recognize the strengths of, and listen to other team members.
define Assets
Resources a person or business owns that have financial value
Discuss the nature of legally binding contracts.
A contract that is legally binding is considered valid and enforceable in a court of law. A contract is a clear outline of an agreement between at least two parties. Usually, contracts define each party involved and any terms used within the agreement, the duration and/or timelines of the contract, payment terms, and provisions that protect each party. Legally binding contracts are required to have "consideration," which means both parties are willingly entering into the agreement and are not being coerced.
Explain the role of finance in business
Explain the role of finance in business
The role of finance in business is to help capital move from investors to businesses. Businesses need finance to assist with operations. This is possible through financial markets and various investment vehicles including loans, and short and long term financing. Finance can also include roles in business development and corporate governance.
16. A government charges a $0.184 tax on each gallon of gasoline, regardless of location or price. This is an example of __________ tax.
A. excise B. sales C. estate D. capital gains
What is Excise?
Excise taxes are specific, targeted taxes that are applied to specific goods and use a flat rate. In contrast, sales tax applies to almost every purchase and is a percentage of the sale price.
An employee accidentally quoted the wrong price to an important customer. How should the employee deal with this problem?
A. Admit the mistake and quote the correct price
B. Tell the customer the typist made an error
C. Ask a coworker to accept responsibility
D. Say the manager provided inaccurate information
Admit the mistake and quote the correct price
When ethical people make mistakes, they don't try to cover them up or put the blame on someone else. Instead, they admit their mistakes and try to correct them if possible.
define liquidity
The ability to meet short-term financial obligations when they become due
Identify state and federal consumer protection laws based on the issues they address and the safeguards they provide.
Federal and state laws, regulations, and consumer protection agencies (e.g., Federal Trade Commission, Consumer Affairs office, and Consumer Financial Protection Bureau) can help individuals avoid unsafe products, unfair practices, and marketplace fraud.
Describe sources of securities information.
There are many places that a consumer or business can gather information on securities including any local financial institution. The U.S. Treasury Department provides information at www.treasury.gov and the TreasuryDirect.gov website. The U.S. Securities and Exchange Commission can be found online at www.sec.gov and state governments often have a securities division within their treasury departments.
Giving more buying responsibility to local stores that are part of large retail chains is a form of
A. centralization. B. decentralization. C. shared buying. D. price-agreement planning.
What is Decentralization?
Many large retail organizations divide their geographic area into districts and delegate part of the central buying authority and responsibility to district managers.
A business's brand promise is what the business intends to
A. use as a trademark.
B. name its product.
C. sell to the target market.
D. provide the customer.
Provide the customer.
A brand promise is similar to a guarantee. It is what the business intends to provide the customer
define Collateral
An asset pledged to secure a loan that a lender may claim if the borrower defaults.
Define bonds
Generally, when you invest in bonds, you are lending money to the issuer in exchange for periodic interest payments. Generally, bonds have a set maturity date —the date when the issuer must fully repay the loan. Bonds typically have terms ranging from one to 30 years.
Define Prompt Payment Act
federal law provision ensuring that the federal government makes timely payments; bills are to be paid within 30 days after receipt and acceptance of materials and/or services
A business wants to send a mailing to all customers who have ordered at least $2,500 in merchandise in the past year. To obtain the appropriate list of customers, the business should set the query by
A. credit rating and location.
B. product code and zip code.
C. sales dollars and dates.
D. last name and account number
What is Sales dollars and dates?
A database software program allows a business to sort customer information by various criteria—customer name, sales volume, customer type, zip code, etc.
Which of the following is the best method a responsible worker could use to become more productive:
A. Read current industry materials
B. Watch coworkers do their jobs
C. Follow unwritten company rules
D. Behave with honesty and integrity
Read current industry materials.
Responsible workers look for better ways to do their work. This includes keeping up with what is going on in the industry.
define Audit
An examination of financial records, statements, or controls to assess their accuracy and reliability.
Define the cash capital cycle.
The cash conversion cycle (CCC) is a metric that measures the amount of time it takes for a company to sell its inventory, collect receivables, and pay its bills. The shorter the cash conversion cycle, the better, and the less time cash is in accounts receivable or inventory. CCC varies based on the industry or sector analyzed.
Define micro-cap stock
Stock of public companies in the United States that have a market capitalization of roughly $50 - $300 million, contrasted with nano-cap stocks, used to designate those companies with market capitalization of less than $50 million
Which of the following is an example of a change in the relative price ratio when the original price of red apples is 60¢ per pound and the original price of green apples is 80¢ per pound:
A. Red apples @ 45¢ per pound; green apples @ 60¢ per pound
B. Red apples @ 90¢ per pound; green apples @ 80¢ per pound
C. Red apples @ $1.20 per pound; green apples @ $1.60 per pound
D. Red apples @ 30¢ per pound; green apples @ 40¢ per pound
Red apples @ 90¢ per pound; green apples @ 80¢ per pound
This is the only combination that resulted in a change in the relative price ratio.When red apples sold for 30¢ per pound and green apples for 40¢ per pound, the price of each was cut in half, and the ratio remained the same.
Sophia needs to distribute a sales report to her employees. There are lots of numbers and figures, but the report is pretty self-explanatory. Sophia should communicate this information to her staff via a
A. voicemail. B. face-to-face meeting. C. conference call. D. memo.
What is a Memo?
If Sophia needs to transmit a message to her staff that involves lots of numbers and figures but doesn't require much explanation, a memo is her best bet. This way each employee will have a record of the information to keep on file.
define Depreciation
The process of allocating the cost of a tangible long-term asset over its useful life.