BUSAD 101 - Introduction to Business » Summer 2022 » Exam Chapters 1, 2, 3 and 4

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Question #1
Profit is the amount of money a business earns above what is spends for salaries and other expenses.
A.   False
B.   True
Question #2
An activity which seeks to earn a profit by providing goods or services is known as a(n):
A.   Business
B.   Corporation
C.   Industry
D.   Service
Question #3
An exchange rate is the value of one nation's currency relative to the currency of another nation.
A.   False
B.   True
Question #4
The total value of a country's output of final goods and services in a given year is known as the gross domestic product (GDP).
A.   False
B.   True
Question #5
Which of the following is a factor of production?
A.   Bonds
B.   Capital
C.   Money
D.   Service
Question #6
A business incurs a ____________________ if its costs and expenses exceed its revenues.
A.   Liability
B.   Loss
C.   Debit
D.   Dividend
Question #7
Microeconomics focuses on the decisions and behavior of people and organizations in particular markets.
A.   False
B.   True
Question #8
Today, the economic systems of most nations could most accurately be classified as:
A.   Mixed Economies
B.   Pure Socialism
C.   Command Economies
D.   Pure Capitalism
Question #9
Economists study how people use resources to produce and distribute goods and services for consumption among competing groups and individuals.
A.   False
B.   True
Question #10
_____________________ is the chance a business owner will lose the time and money invested in a business that proves to be unprofitable.
A.   Risk
B.   Depreciation
C.   Falibility
D.   Redundancy
Question #11
An unfavorable balance of trade occurs when the value of:
A.   Cash inflows are equal to the value of cash outflows.
B.   Exports exceed the value of imports.
C.   Imports exceed the value of exports
D.   Imports equal the value of exports.
Question #12
If a shortage exists in a market for a good, the price of that good will tend to fall.
A.   False
B.   True
Question #13
______________________ studies the operation of a nation's economy as a whole.
A.   Socioeconomics
B.   Macroeconomics
C.   Microeconomics
D.   Econometrics
Question #14
____________________ is the selling of products in another country.
A.   Exporting
B.   In-trading
C.   Dumping
D.   Importing
Question #15
Inflation refers to a general rise in the prices of goods and services over time.
A.   True
B.   False
Question #16
____________________ is a condition in which the average level of prices is actually falling.
A.   Disinflation
B.   Inflation
C.   Deflation
D.   Stagflation
Question #17
Demand refers to the quantity of a good that consumers are willing and able to buy at different prices at a specific time.
A.   False
B.   True
Question #18
Entrepreneurship is one of the four factors of production that contribute to the creation of wealth.
A.   True
B.   False
Question #19
A favorable balance of trade occurs when the value of a country's imports exceed the value of its exports.
A.   False
B.   True
Question #20
As a factor of production, the term capital includes:
A.   Services provided by the government that enable businesses to be more productive.
B.   Stocks and bonds issued by corporations.
C.   Natural resources such as land and water.
D.   Tools, machinery and buildings.
Question #21
Entrepreneurship is:
A.   Managing businesses that operate in multiple countries.
B.   Managing businesses for others.
C.   A controlling interest in the ownership of a corporation.
D.   Accepting the risk of starting and running a business.
Question #22
Global trade is the exchange of goods and services between countries.
A.   True
B.   False
Question #23
The quantity of a good or service that producers are willing to sell at different prices during a specific time period is known as the:
A.   Demand for that product or service
B.   Utility of that product or service
C.   Elasticity of that product or service
D.   Supply of that product or service
Question #24
A corporation can raise financial capital by selling shares of stock to interested investors.
A.   True
B.   False
Question #25
Importing is the selling of products to another country.
A.   False
B.   True
Question #26
At the equilibrium price, the quantity consumers desire to buy equals the quantity sellers desire to sell.
A.   True
B.   False
Question #27
In socialist economies, the government owns some if not most basic businesses such as telecommunications systems and utilities.
A.   True
B.   False

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