test

Question 1

government -set maximum price that can be charged for a good or service

Answer 1

price ceiling

Question 2

government set minimum price that can be charged for a good or service

Answer 2

price floor

Question 3

if something goes wrong and the business loses money, the owner has this and must pay for the losses

Answer 3

unlimited liability

Question 4

that an owner cannot lose money than put into the business

Answer 4

limited liability

Question 5

one share of ownership interest in the corporation that is given when people contribute to the corp’s capital

Answer 5

stock

Question 6

a market in which stocks and bonds called securities are bought and sold publicly

Answer 6

stock market

Question 7

not a form of business, but a license to operate as another business

Answer 7

Franchise

Question 8

simplest form of business where the business and the owner of the business are the same

Answer 8

Sole Proprietorship

Question 9

a sole proprietorship but with more than one owner, owners share income and losses in the same amounts that they own the firm

Answer 9

Partnership

Question 10

limited liability and unlimited life, must pay taxes on income and owners must pay income taxes on income received from this

Answer 10

Corporation

Question 11

the right of the shareholder to receive one share of income paid out by the corporation

Answer 11

dividend

Question 12

keep businesses from forming monopolies

Answer 12

Anti-trust laws

Question 13

maket with many buyers but only one selleer

**THIS IS BAD- TOO MUCH POWER

Answer 13

Monopoly

Question 14

market with a small number of small number of sellers

Answer 14

Oligopoly

Question 15

organization whose numbers work together to benefit themselves individually, usually economically

Answer 15

Cooperative

Question 16

large corporation of many different companies different countries

Answer 16

multinational

Question 17

company purchasing the companies that deliver its supplies and handle its transportation

Answer 17

Vertical merge

Question 18

one business buying another business of the same kind

Answer 18

horizontal merge

Question 19

the measure of the size of the economy. It is the total value, in dollars, of all final goods and services produced in the country during a single year. Final goods are sold to their users

Answer 19

Gross Domestic Product

Question 20

converts the nation’s annual output into constant dollars by taking out the inflationary increases in prices. when prices increase, GDP would go up even though the economy wasn’t growing. To avoid this false impression economics use this

Answer 20

real GDP

Question 21

The percentage of people in the civilian labor force who are not working but are looking for jobs(16 and older)

Answer 21

Unemployment Rate

Question 22

An increase in the general price level

Answer 22

Inflation

Question 23

to track inflation, the government samples prices every month fro about 400 products commonly used by consumers. The rate of inflation is the change in the average level of prices measured by this

Answer 23

Consumer Price Index

Question 24

What are the 4 phases to the business cycle?

Answer 24

Expansion, Peaks, Recession, Trough

Question 25

Real GDP growing and unemployment rate usually falls

Answer 25

Expansion

Question 26

Highest point of expansion. Economics can only measure once contraction begins

Answer 26

Peaks

Question 27

An extended recession

Answer 27

Depression (not a part of business cycle)

Question 28

Real GDP decreases 6 consecutive months; unemployment rate usually increass

Answer 28

Recession

Question 29

Lowest point of the recession. Economists can only measure once expansion begins

Answer 29

Trough

Question 30

your output is larger than your input

Answer 30

Productivity

Question 31

supports the environment and limits the wasting of processed material that can be used in further production

Answer 31

Recycling

Question 32

economic law that states at some pint increasing one factor of production will only decrease productivity

Answer 32

Law of Diminishing Returns

Question 33

measures the average change in the prices charged to domestic producers at all stages of production

Answer 33

Producer Price Index

Question 34

Factors of Production

Answer 34

Capital Goods, Labor, Natural Resources and Entrepreneurship

Question 35

a man made factor of production in making products. Includes tools, factories, machines, etc.

Answer 35

Capital Goods

Question 36

any form of human effort exerted in production. Also called human resources

Answer 36

Labor

Question 37

productive resources that are provided by nature- such as land, air water, forests, coal, iron ore, oil, and minerals

Answer 37

Natural Resources

Question 38

the individual responsible for combining and organizing natural resources, capital goods, and labor to produce a good or service. Role could involve assuming the risks of business failure and/or providing creativity and managerial skills necessary for production to take place

Answer 38

Entrepreneurship

Question 39

there is a limited supply to meet unlimited wants

Answer 39

Scarcity

Question 40

Because resources are scarce, the choice to use a resource in one way means not using it in another ex: using a field to grow tobacco means the field cannot be used to grow soy beans

Answer 40

Opportunity Cost

Question 41

is a measure of the amount of output produced by a given amount of inputs. affects how efficiently resources are being used

Answer 41

productivity

Question 42

money left over from selling a good or service after the costs of buying productive resources have been paid

Answer 42

profite

Question 43

exchanging one thing for the use of another

Answer 43

trade off

Question 44

expenses that are the same no matter how many units of a good are produced

Answer 44

fixed cost

Question 45

expenses that change with the # of products produced

Answer 45

Variable costs

Question 46

what you cannot buy or do when you choose to do or buy one thing rather than another

Answer 46

Opportunity cost pt 2

Question 47

fixed costs + variable costs =

Answer 47

TOTAL COST

Question 48

extra cost for producing one additional unit of output

Answer 48

marginal cost