If one large company owned all of the hotels in one country, that company would have a
monopoly
The law of supply states that
businesses will provide more products when the can sell them at higher prices
A pencil factory is losing money, even though sales are high. The owners do not want to fire employees or lower their wages. They cannot raise the price of the pencils and remain competitive. They need to find a way to
increase worker productivity
In the 1800's, laws were passed to help prevent
monopolies
Corporations are owned by
stockholders
A small, family-owned bakery is an example of a
sole proprietorship
All Americans can enjoy the following economic freedoms EXCEPT the freedom to
fix prices
An enterprising high school student wants to publish and sell a national high school newsletter. He will most likely set up his business as a
corporation
Capital is
manufactured goods used to make other goods
The law of demand states that
consumers will purchase fewer products when they must buy at higher prices
A corporation's board of directors does all of the following EXCEPT
manage daily business operations
You have purchased several shares in a company. During its second year of operation, the corporation builds up numerous debts, and ultimately fails. What will most likely happen?
The most money you will lose is what you paid for your shares
All of the following roles played by the U.S. government in the economy EXCEPT
regulating profits of the largest corporations
Bonds are essentially
loans to a corporation
Last Christmas a popular toy was sold out all over town. When a local toy store received a shipment, it advertised the toy at twice its normal price. The store doubled price due to
scarcity
The U.S. economy is characterized by many freedoms and is often called a
free market economy
The issue of scarcity of natural resources
helps determine their market value
The relationship between supply and demand is
predictable
The tools owned by a self employed electrician are
capital
The free enterprise system means that Americans
are able to run their businesses in the way they think is best
Some goods can be produced more efficiently by larger companies. Such a situation is called
an economy of scale
The U.S. economic system can be best described as a
mixed economy
The duty of a corporation's board of directors is to
represent stockholders in making decisions for the corporation
In a corporation, stockholders
elect the board of directors
Which country has a command economy?
North Korea
Nonprofit organizations
are not taxed by the government
An essential factor of a free market economy is the
profit motive
When a company has very high profits,
the market price of its stock usually increases
In a command economy, most of the capital, tools, and production equipment are
owned by the government
Who pays a business's debts in a failed sole proprietorship?
the owner of the business