Business Organizations
What business organization allows the owner to keep all profits?
sole proprietorship
What does barter mean?
trading one good or service for another
Who is known as the “Father of Economics”?
Adam Smith
If the price of a good rises, what happens to quantity demanded?
it decreases
What does GDP stand for?
Gross Domestic Product
Which business organization has the greatest potential for growth?
corporation
Why do companies sell stocks?
to gain financial capital
What does laissez-faire mean?
hands off government
What happens when quantity supplied is greater than quantity demanded?
surplus
What is inflation?
increase in average prices over time
What is a major disadvantage of a partnership
potential conflict between partners
How many Federal Reserve districts are there?
12
What type of economy does the United States have?
mixed economy
A hurricane destroys crops—what happens to supply?
supply decreases
When inflation increases, purchasing power does what?
decreases
Which business organization has unlimited liability for the owner?
sole proprietorship
What are the three functions of money?
medium of exchange, store of value, and unit of account
What does full employment mean?
everyone who wants to work can find a job
A new technology improves efficiency—what happens to supply?
supply increases
What are imports?
goods and services brought into a country
Name the three business organizations focused on in class.
sole proprietorships, partnerships, and corporations
Who is the current Chairman of the Federal Reserve?
Jerome Powell
Which economic system does North Korea have?
command economy
A recession reduces income—what happens to demand for luxury cars?
demand decreases due to lower income
What is a benefit of international trade?
economic growth, efficiency, and increased variety of goods