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Types of Business Organizations
Market Structures
Taxes
Government Spending and Revenue
Federal, State, and Local Spending
100
A firm owned by one person
What is a Sole Propriertorship?
100
The different types of market structures?
1. Perfect Competition 2. Monopolistic Competition 3. Oligopoly 4. Monopoly
100
A mandatory payment to a local, state, or national government.
What is a tax?
100
Government income from non-tax and tax sources.
What is revenue?
100
What is a deficit?
Occurs when the government spends more than it takes in.
200
Three advantages of a sole proprietorship over other business organizations? (Name 3)
What are... 1. Owner keeps all the profits 2. Freedom and Control 3. Few Regulations 4. Be your own boss
200
This market structure has only a few sellers offering a similiar product and dominate that specific market.
What is an Oligopoly?
200
The 3 criteria for taxation.
What are 1. Equity 2. Simplicity 3. Efficiency
200
One reason we use the payroll withholding system?
Easier for taxpayer so they will not have to save money. Easier for government so they have a steady stream of income. Government is more likely to get money this way.
200
Name the two types of federal spending and state the difference between them.
Mandatory and Discretionary Spending; Mandatory- spending that is required by current law, Discretionary- spending that the government has to authorize each year
300
Three advantages of a corporation.
What are: 1. Limited Liability 2. Access to funds 3. Ability to raise funds 4. Unlimited Life 5. Professional managers
300
In a monopoly, this happens to prices.
What is GO UP/INCREASE?
300
The 4 most common tax bases.
1. Individual Income Tax 2. Corporate Income Tax 3. Sales Tax 4. Property Tax
300
Four taxes the Federal Government makes money off of.
1.Individual Income tax 2. Social Insurance tax 3. Corporate Income tax 4. Excise tax 5. Estate and Gift tax 6. Custom Duties
300
Three categories of Discretionary Spending .
1. National Defense- 2. Education- 3. Natural resources and environment
400
Part of a profit that the company pays out to stockholder
What is a dividend?
400
Two characteristics of a perfect competition.
1. large number of buyers and sellers exist 2. deal with identical products 3. buyers/sellers act independently 4. buyers/sellers are reasonably well informed 5. buyers/sellers free to enter, conduct, and get out of business
400
A tax placed on the production or sale of a specific good or service is a(n) _________ ________. Sin taxes are often this type of tax.
What is an excise tax?
400
Four taxes included in FICA (Federal Insurance Contributions Act):
Includes: Social Security, Medicare, Medicaid, and Unemployment taxes.
400
The two levels of government that collect sales taxes?
What are state and local?
500
The difference between vertical, horizontal, and conglomerate mergers. Give examples of each.
What are: Horizontal-two or more firms that produce the same kind of product join forces ex: At&t and Cingular Vertical- merger of firms involved in different steps of manufacturing and marketing of a product ex: Oil refinery and gas station Conglomerate- merger of companies that produce unrelated goods or services ex: Disney and ABC
500
Name the 4 types of monopolies, give a brief description, and an example for each.
1. Natural- Society might be best served by a having a monopoly ex: electric company 2. Geographic- No other business in the area offers any competition ex: Wal-Mart in secluded area 3. Government- A business the government owns and operates ex: post office 4. Technological- Firm or individual has discovered a new product ex: Patents or Copyrights
500
Name the different tax structures and describe each.
1. Proportional Tax- takes the same percentage of income from all taxpayers, regardless of income level 2. Progressive Tax- places a higher percentage rate of taxation on high-income earners than low- income earners. 3. Regressive Tax- takes a larger percentage of income from people with low incomes than from people with high income
500
The two principles of taxation. Name and describe; What is a problem with each?
Benefits-Received- people who benefit directly from public goods should pay for them (had to determine how much different taxpayers benefit from certain services) Ability-to-pay- people should be taxed on their ability to pay (a person's income, does not alway determine their ability to pay for something)
500
People in Louisiana pay income taxes to the ___________ and ___________ governments.
federal and state