Types of Business
This is a business owned and operated by one person.
What is a sole proprietorship?
Costs that do not change.
What are fixed costs?
The satisfaction gained by using a good or service.
What is utility?
One large firm is the only seller in a market
What is monopoly?
This is the state of being held legally responsible.
What is liability?
A business owned by two or more people.
What is a partnership?
Costs that change depending on how much is produced.
What are variable costs?
The additional cost of producing each individual unit.
What is marginal cost?
A few firms share a large majority of the market.
What is an oligopoly?
What is not being required to pay any taxes?
What is tax-exempt?
This is a type of business that exists independently of its owners (shareholders).
What is a corporation?
What is accounting profit?
This states that each additional unit consumed provides less satisfaction than the unit before.
What is the law of diminishing utility?
A large amount of firms sell similar, but not identical products.
What is monopolistic competition?
Many economists support anti-trust laws because they promote this.
What is competition?
This is total revenue minus explicit and implicit costs.
What is economic profit?
The local farmer's market offers 1 bag of romaine lettuce for $5 or 2 bags for $8. This is the marginal cost of the second bag.
What is $3
A very large amount of firms sell essentially identical products
What is perfect competition or "pure competition?"
(either answer is acceptable)
This is the document all partners in a firm must sign to start a partnership.
What is a partnership agreement?
This is the term for when income taxes are paid twice on the same source of income through corporate profits and shareholders' income.
What is dual taxation?
This is the type of profit that companies need to make to stay in business.
What is accounting profit?
Suppose the relationship between your study time and your grade on a Biology midterm is given by the following:
4 Hours: 80%, 5 Hours: 92%, 6 Hours: 93%
What is the marginal benefit of studying 6 hours instead of 5?
What is 1%?
Price discrimination works best when this happens.
What is the firms have a large share of the market?
Patents and other intellectual property laws encourage this.
What is innovation?