Exsam 2

Question 0

Partnership

Answer 0

Two or more owners of a company 10% of all firms

Question 1

Sole proprietorship

Answer 1

One owner of a company 70% of all firms

Question 2

Corporation

Answer 2

Only requires a lot of paperwork, organization itself tends to be more complex

• 10% of all firms
• 70% of partnerships

Question 3

Asset

Answer 3

Anything of value

Question 4

Liability

Answer 4

Anything you owe

Question 5

Limited liability

Answer 5

Financial liability is limited to a fix some most commonly the value of a person’s investment in a company or partnership

Question 6

Entrepreneur

Answer 6

Able to start small businesses and risks money to make more money

Question 7

Corporate government

Answer 7

How corporation runs their buiessness

Question 8

How to Raise capital in a cooperation

Answer 8

• Borrow money from bank
• invest in mutual funds
• invest in stock
• issue bonds

Question 9

GAAP

Answer 9

(Generally accepted accounting principles)

Question 10

Income statement

Answer 10

Measures over a period of time how much sale you have versus your expense

Question 11

Balance sheets

Answer 11

Assets vs. liabilities

Question 12

Reattained earnings

Answer 12

What a company keeps and doesn’t pay back to anybody

Question 13

SARBAIMS-OXIY

Answer 13

Makes sure cooperations cant lie about accounting

Question 14

Comparative advantage

Answer 14

When one companies opportunity cost is less then a competitor and allows the company to do something easier

Question 15

International trade

Answer 15

Between different countries

Question 16

Exports

Answer 16

Ships products out

Question 17

Imports

Answer 17

Products taken in

Question 18

Trade surplus

Answer 18

Ship more out than we bring in

-generally good

Question 19

Trade deficit

Answer 19

Exports are less than imports

• generally bad
• costs jobs
• lower wages

Question 20

Tariff

Answer 20

Tax on imports

Question 21

Absolute advantage

Answer 21

Fewer inputs to do the same manufacturing job than a competitor

Question 22

Autarky

Answer 22

Only trades within individual nation

Question 23

Contributions to comparative advantage

Answer 23

• Climate/ natural recourses
• labor/ capital
• technology
• external economies

Question 24

Free trade

Answer 24

Trade with no legal or tariff restrictions

Question 25

Quota

Answer 25

One country puts a cap that limits the volume of material shipped into a country

Question 26

Embargo

Answer 26

Boycott of a product

Question 27

VER (voluntary export restraint$

Answer 27

Ask another country to slow down the flow of products into a country

Question 28

World trade organization

Answer 28

Corporation that helps other develop buissness

Question 29

Globalization

Answer 29

Talks about the world as a whole

Question 30

Protectionism

Answer 30

No trade with other countries - argument to save jobs - protect our wages - protect new it infant economies from competition from other countries - national security

Question 31

Dumping

Answer 31

Selling a product for far less than it's worth/then I competitors price to run them out of buissness

Question 32

Positive economics

Answer 32

Fact based economics statement

Question 33

Normative economics

Answer 33

Opinion based economics statement

Question 34

GDP ( gross domestic product)

Answer 34

Measure of economy in terms of what is produced here. -GDP= consumption+ investment+government spending+ net exports

Question 35

Consumption

Answer 35

What we spend

Question 36

Investments

Answer 36

the action or process of investing money for profit or material result.

Question 37

Government purchases

Answer 37

All government expenditure on currently produced goods and services, exclusive of government transfer payments

Question 38

Net exports

Answer 38

the difference between a country's total value of exports and total value of imports.

Question 39

Different types of products

Answer 39

- Raw materials: start with - in process: in process of being made - finished goods: goods finished being made

Question 40

GDP per capita

Answer 40

Measures how well a countries citizens are doing Total GDP / total citizens of country= GDP per capita

Question 41

Microeconomics

Answer 41

Economics dealing with individuals

Question 42

Macroeconomics

Answer 42

Dealing with the economy as a whole

Question 43

Buissness cycle graph

Answer 43

The fluctuations in economic activity that an economy experiences over a period of time.

Question 44

Transfer payments

Answer 44

All government payments without anything in return (labor/product) not part of GDP

Question 45

Nominal GDP

Answer 45

Prices of goods and services measured in today's Values

Question 46

Real GDP

Answer 46

Same As GDP but factors in a base

Question 47

General price level

Answer 47

Average price of a good from one year to the next

Question 48

GDP deflator

Answer 48

Gives an idea if prices are going up or down (Nominal GDP / real GDP)(100)=GDP deflator

Question 49

Gross national product (GNP)

Answer 49

Measures total economy except by the residence where ever they produce -measures companies worldwide

Question 50

National income

Answer 50

Total income if a country

Question 51

Personal income

Answer 51

All income families and households make

Question 52

Disposable personal income

Answer 52

The total amount of money available for an individual or population to spend or save after taxes have been paid.

Question 53

Limited liability

Answer 53

If a firm fails, the owners never lose more than what they have invested in the firm

Question 54

3 largest rating companies

Answer 54

Moodies Standard and poors Fitch ratings