Chapter 1

Question 1

Business

Answer 1

produce or sell products in order to make profit

Question 2

Profit

Answer 2

Revenue - expenses

Question 3

non-profit organization

Answer 3

provide goods/service but do not seek profit; school, hospital

Question 4

Shortage

Answer 4

drives prices up

Question 5

Surplus

Answer 5

drives prices down

Question 6

private enterprise

Answer 6

market economy w/ little government restrictions (own property, freedom of choice, freedom to compete)

Question 7

competition

Answer 7

businesses compete for the same resources/customers in a market/industry

Question 8

DEGREES OF COMPETITION

Answer 8

perfect competition, monopolistic competition, oligopoly, monopoly

Question 9

perfect competition

Answer 9

many sellers; products are identical, easy to enter industry, no control over price

Question 10

monopolistic competition

Answer 10

few~many sellers; products are unique by some buyers, minor control over price

Question 11

oligopoly

Answer 11

few large suppliers; high barrier to enter; products are similar, prices depend on market: nintendo, sony

Question 12

monopoly

Answer 12

one producer/supplier of supply; unique product, complete control over price, no competition