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Shortage exists when demand is greater than the supply
True
The money people have left over after they have paid their taxes is called
Disposable income
Interest rates for all types of credit are
regulated by the state governments and the federal government
Mortages are offered by all of the following except
consumer finance companies
Consumers can transfer money electronically from their bank accounts to the bank accounts of stores or resturants
Debit cards
A finance charge
is the cost of credit expressed monthly in dollars and cents
Credit card companies such as Visa and Mastercard are issued by
Banks
A financial institution that is owned and operated by members to provide savings accounts and low interest loans is a
Credit Union
A car used by a mesenger service is a type of
capital
business cycles in the united states
occur irregularly
A usury law
sets maxium interest rates consumers can be charge
People who are able to use or store large quantities of bulk food items can save money shopping at
warehouse stores
Rent controls result in
lower rents than would normally be charged
Automobile liability insurance covers
bodily injury and property damage
Why are current clothing styles generally expensive
sellers know that consumers will pay to keep up with fashions
According to the law of demand, when the price of an item goes up the quantity demanded
falls
Diminishing marginal utility refers to the fact that
additional satisfaction declines as additional units of an item are consume
Demand for one particular brand of coffee is probably
elastic
Generally, the more substitutes there are for a good, the
more elastic the demand
If the price of the product is above its equilibirum price, the result is a
surplus
unlimited liability means that
the owner of the busness has complete legal responsibility for all debts/damages
the stock of the largest companies in the United States is
New York Stock Exchange (NSYE)
In the United States, which type of business accounts for the greatest share of revenues?
corporation
A joint venture is a
a temporary partnership set up for a specific purpose for a short period of time
entrepreneurs are people who
startup businesses
in a limited partnership
some partners bear no risk
the practice of asking the public not to purchase goods or services produced by a company whose workers are on strike
boycotting
a deliberate work stoppage by employees is called
a strike
the minimum wage law may
increase unemployment among teenagers and minorities
During the 1930’s, the united states experienced
a depression
Business cycles in the united states
occur irregularly
ATM’S recieve deposits, give out funds, accept payments, and
transfer funds between accounts
representative money is money that is
backed by a vunerable item, such as gold
which of the following is not a function of money
interest-bearing exchange
the FDIC was created to
protect depositor savings and give confidence in the banking system
which type of institution must belong to the federal reserve
national banks
the chairman of the federal reserve board during the 1990’s was
Alan Greenspan
Which of the following is not a function of the federal reserve system?
setting the interest rates banks must charge
the federal reserve is responsible for
monetary policy in the united states
the assembly line was developed in the early 20th century
the ford motor company
All the combination of goods and services that can be produced in a given time with a fixed amount of resources are
production possibilities
entrepreneurship refers to the ability to
start new businesses, new products and processes, and improve management
Adam Smith’s “invisible hand“ refers to the role of
the market
A major characteristic of a pure market economy is
unrestricted competition
The production possibilities curve shows the maxium combination of goods and services that can be produced
True
If demand for a good increases and supply does not the equilibruim price will rise
True
You should pay your high interest credit cards first
true
Treasury bonds and bills are issued by the United States treasury
True
The substitution effect can decrease the quantity demanded of a good
true
A franchisee pays a certain percent of their revenues to franchisor
true
the law of demand does not apply in a monopoly
false
in a sole proprietorship, owners pay only personal income taxes on their profits
true
the Board of Directors of a corporation makes all the descisions about the company’s day to day production
false
A cartel raises the prices of the goods it controls
true
a laissez-faire system is one in which
government interference in the economy is minimal
All of the following are consumer rights except the
right to recive a warranty
generic products are those that
have no brand name at all
Bait and Switch is an example of
deceptive advertising
According to the law of supply, higher prices prompt producers to
produce more
When the price of a good is high for consumers, they look for
substitutes
the quantity demanded of a product is affected by
price
if the price of an item rises, quantity demanded usually
falls
the principle that states that the more you have of something, the less satisfaction you will get from an additional unit
law of diminishing marginal utility
One advantage of an oligopoly is
more stable prices
All of the following are chracteristics of a monopoly except
presence of many competing firms
If one company purchases 52% of the stock of another company, the transaction is known as a
merger
market structure describes
amount of competition a business faces
natural monopolies are businesses that
provides such things as utilities, public transportation , and cable TV
Which of the following represents a form of nonprice competition
advertising
the largest sector of the american labor force
service sector workers
collective bargaining is the process in which
unions and employers negotiaye the conditions of employment
The federal reserve system was established to
control the amount of money in circulation
The federal reserve has the power to
regulate national bank resources
M2 is
A broader definition of the money supply then M1
A company’s office buildings are an example of
capital
in a pure monopoly, the seller will change more than the equilibrium price
true
factors of production include which of the following
land, labor, and capital
businesses can make decsicions about the best use of their resources by analyzing
production possibilities
the value of the next best alternative that has to be given up for the action tha is chosen is the
oppurtunity cost
economics is primarily concerned with which of the following
how resources are used in production
another term for a capitlast system is
market economy
according to Adam Smith
government should not in the market place
it is easier to start your own business in a
free enterprise system
what goods and services should be produced, how they should be produced, and who should share in what is produced…
all economies
a promise to repair or replace a faulty product within a certain time is
a warranty
every purchase decision involves the use of two scarce resources
money and time
which of the following is a NOT a consumer right
the right to a fair price
entrepreneurs are people who start their own businesses
true
generic products are usually more expensive than brand name products
false
comparison-shopping helps consumers make informed decisions
true
it is more difficult to obtain an unsecured loan than a secured loan
true
disposable income is a person’s income before taxes are taken out
false
a debit card is a credit card
false
when people’s income goes up, they usually consume less of a good or service
false
people diversify their investments by investing in several different kinds of investments
true
according to the law of supply, producers are willing to supply more when the price of a good or service goes up
true
some credit card companies get people into signing up by
offering low initial APR’s
Shares traded on the New York Stock Exchange tend to be those of
very large corporations
a company’s office buildings are an example of
Capital
Note 
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