2.03 Economic Systems
Another term for economic resources is?
A. nonmonetary benefit.
B. factors of production.
C. goods and services.
D. financial capital.
B. factors of production.
An individual who assumes the risk of starting and operating a business is called a(n)?
A. entrepreneur.
B. manager.
C. economist.
D. society.
A. entrepreneur.
Most businesses can increase their profits by
A. improving worker efficiency
B. increasing sales quotas
C. obtaining a subsidy
D. cutting workers' hours
A. improving worker efficiency
Which factor that affects profit can be controlled by a business?
A. Expenses
B. Economy
C. Chance
D. Demand
A. Expenses
Under which type of economy does the government own the basic means of production, but with some private ownership of businesses?
A. command
B. communism
C. entrepreneurship
D. socialism
D. socialism
In a private enterprise economic system, consumers can choose from a variety of products as a result of?
A. the collection of taxes.
B. limited government control.
C. inflation.
D. competition.
D. competition.
The personnel office of a business carefully checks the background and references of its job applicants. This is an example of handling business risks through?
A. prevention.
B. retention.
C. avoidance.
D. transfer.
A. prevention.
Competition helps create a healthy society by:
A. creating new jobs.
B. increasing the money supply.
C. making new government regulations.
D. replacing small businesses with large businesses.
A. creating new jobs.
What is the name for markets with only a few sellers, such as the markets for automobiles, pharmaceuticals, or oil?
A. oligopolies
B. monopolies
C. perfect competition
D. monopolistic competition
A. oligopolies
What economy is based on public or governmental ownership of the production and distribution of goods?
A. capitalist
B. mixed
C. socialist
D. traditional
C. socialist
Which factor is a barrier to small-business and entrepreneurial success?
A. poor management
B. no vision for expansion
C. having a clear strategic vision
D. having a surplus of employees
A. poor management
In 1890, Congress passed a law that prevents monopolies from forming and hinders price fixing. What law is this?
A. Clayton Act
B. Robinson-Patman Act
C. Sherman Antitrust Act
D. Celler-Kefauver Antimerger Act
C. Sherman Antitrust Act
R & R Real Estate company buys errors and omissions liability insurance. What form of risk management is this?
A. avoidance
B. reduction
C. retention
D. transfer
D. transfer
In some places, a company can have exclusive control of the supply of a good or service such as the trash service. This is an example of:
A. price competition.
B. price discrimination.
C. nonprice competition.
D. a regulated monopoly.
D. a regulated monopoly.
In a socialist economy, what determines how basic economic questions are answered?
A. government
B. products
C. resources
D. retailers
A. government
A small business is defined as a business employing fewer than how many people?
A. 500
B. 750
C. 1,000
D. 1,500
A. 500
What is the amount of money paid for raw materials and products sold?
A. net profit
B. gross profit
C. cost of goods
D. operating expense
C. cost of goods
A market structure that features no barriers to entry and has an unlimited number of businesses selling the same products is a/an:
A. oligopoly.
B. perfect competition.
C. regulated monopoly.
D. monopolistic competition.
B. perfect competition.
A business decides against opening a store in the next town because its research shows the location will be unprofitable. What form of risk management is this?
A. avoidance
B. reduction
C. retention
D. transfer
A. avoidance
The economic system that adopts the fewest new ideas or improvements is:
A. communist.
B. market.
C. socialist.
D. traditional.
D. traditional.
What is the economic basis for the private enterprise economic system?
A. competition
B. the marketplace
C. the motive of profit
D. manufacturer supply chain
C. the motive of profit
Arc Electric Company holds regular safety training meetings for its employees. What form of risk management is this?
A. capital
B. reduction
C. retention
D. transfer
B. reduction
Negative events which an organization or company has no control over are:
A. debits.
B. credits.
C. speculative risks.
D. pure business risks.
D. pure business risks.
All Care pays for all of its expenses this fiscal year. The amount left over after all expenses have been paid is called what?
A. capital
B. debt
C. loss
D. profit
D. profit