Question 1

A business provides goods or services in order to earn profits.

Accepted Answer

This is a basic principle of business – the goal is to provide value to customers in exchange for payment in order to earn profits.

Question 2

Economic systems allocate the factors of production differently.

Accepted Answer

Economic systems differ in how they allocate the factors of production (land, labor, capital, and entrepreneurship) among various economic agents, such as households, firms, and the government. For example, in a market economy, the factors are mostly allocated through the price mechanism, while in a command economy, the government controls the allocation of resources.

Question 3

Political-legal environment includes the customs,mores,values and demographic characteristics of the society in which an organization functions.

Accepted Answer

The statement is incorrect. The political-legal environment refers to the laws, regulations, and political systems that affect an organization's operations in a society. Customs, mores, values, and demographic characteristics are part of a society's socio-cultural environment.

Question 4

Global business environment refers to the international forces that affect a business.

Accepted Answer

Global business environment is the term used to describe the external factors that impact the operation of a business beyond its domestic borders. These factors include economic, political, legal, cultural, social, and technological forces that can affect a company's ability to compete in international markets. Therefore, Global business environment refers to the international forces that affect a business.

Question 5

The technological environment only includes electronics and telecommunications used to perform business activities.

Accepted Answer

The technological environment includes not only electronics and telecommunications but also software, information systems, and other technologies that can be used for business activities. It also includes the impact of emerging technologies and trends on businesses, such as artificial intelligence, robotics, and the internet of things.

Question 6

The point at which the supply curve and the demand curve intersect is the market price.

Accepted Answer

The intersection of the supply curve and demand curve represents the equilibrium price at which the quantity demanded equals the quantity supplied, thus determining the market price.

Question 7

An entrepreneur is a business that accepts the risks and opportunities to create and operate.a new business venture.

Accepted Answer

An entrepreneur is an individual who accepts the risks and opportunities to create and operate a new business venture, not a business itself.

Question 8

Physical resources are the data and other information used by businesses.

Accepted Answer

Physical resources refer to tangible assets such as facilities, equipment, and infrastructure, not data and information.

Question 9

The law of demand states that buyers will purchase more of a product as its price drops and less of a product as its price increases.

Accepted Answer

This is the basic principle of the law of demand, which states that there is an inverse relationship between the price of a good or service and the quantity demanded of that good or service. As the price of a product decreases, consumers are more willing and able to buy more of that product, and vice versa.

Question 10

A planned economy relies on a centralized government to control all or most of the factors of production and to make all or most production and allocation decisions.

Accepted Answer

A planned economy is also known as a command economy, where the government has complete control over the production and distribution of goods and services. It is the opposite of a market economy, where individuals and businesses make production and allocation decisions based on supply and demand.

Question 11

Non-profit businesses operate in many of the same ways as businesses that seek profits.

Accepted Answer

The answer of Non-profit businesses operate in many of the...

Question 12

In a socialist economy,the government owns and operates selected major industries.

Accepted Answer

In a socialist economy, the government typically owns and operates certain major industries such as healthcare, education, transportation, and energy, with the goal of distributing resources and wealth more equally among the population.

Question 13

The external environment consists of everything inside an organization's boundaries that might affect it.

Accepted Answer

The statement is incorrect. The external environment consists of everything outside an organization's boundaries that might affect it.

Question 14

Businesses seek to be close to customers,establish strong relationships with suppliers,and distinguish themselves from competitors.

Accepted Answer

This statement is true. Businesses strive to be close to their customers to better understand their needs and offer personalized services. They also build strong relationships with suppliers to ensure consistent quality and timely delivery of goods or services. Additionally, businesses differentiate themselves from competitors through unique value propositions, branding, and marketing strategies.

Question 15

There are many sellers in an oligopoly.

Accepted Answer

An oligopoly is a market structure characterized by a small number of sellers or firms, which dominate the market and have significant control over prices and production.

Question 16

A differentiating strategy used in monopolistic competition is to use brand names such as Tide and Cheer.

Accepted Answer

Brand names are a common way for firms in monopolistic competition to differentiate their products from those of their competitors. By establishing a strong brand identity and reputation, firms can create a loyal customer base and charge a premium price for their products.

Question 17

An example of the influence of the economic environment is when most people have jobs and therefore a growing company may find it necessary to pay higher wages and offer more benefits in order to attract workers from other companies.

Accepted Answer

In a strong economic environment with low unemployment rates, there is typically a greater demand for workers, which can lead to companies having to offer better compensation packages to attract and retain talent.

Question 18

A factor of production is a nation's system for allocating resources among its citizens.

Accepted Answer

A factor of production refers to resources such as land, labor, capital, and entrepreneurship that are used to produce goods and services. A nation's system for allocating these resources among its citizens is known as an economic system.

Question 19

Standard of living refers to the quantity and quality of goods and services that people can purchase with the currency used in their economic system.

Accepted Answer

Standard of living refers to the level of wealth, comfort, material goods, and necessities available to a certain socioeconomic class or a certain geographic area. It is usually measured by Gross Domestic Product (GDP) per capita or average income per person. The currency used in the economic system is important because it determines the purchasing power of individuals and their ability to access goods and services. Therefore, the statement that standard of living refers to the quantity and quality of goods and services that people can purchase with the currency used in their economic system is true.

Question 20

Capitalism allows for the private ownership of the factors of production.

Accepted Answer

Private ownership of land, labor, capital, and entrepreneurship is a key feature of the capitalist economic system. This allows individuals to own and operate businesses, invest in property, and make economic decisions based on their own self-interest.

Quiz 1: The U.S.Business Environment