Business Management Test 1

Business 

Any activity that seeks to provide goods and services to others while operating at a profit. 

Profit

Revenue less Expenses

Stakeholders

All the people who stand to gain or lose by the policies and activities of a business and whose concerns the business needs to address. 

Economics 

The study of how society chooses to employ resources to produce goods and services and distribute them for consumption among various competing groups and individuals. 

Macroeconomics

Type of economics that studies the operation of a nation’s economy as a whole.

Microeconomics

Type of economics that studies the behavior of people and organization in particular market. 

Factors of production

The resources used to create wealth: land, labor, capital, entrepreneurship, and knowledge.

Monopolistic Competition

The degree of competition in which a large number of sellers produce very similar products that buyers nevertheless perceive as different. 

Oligopoly 

A degree of competition in which just a few sellers dominate the market. 

Demand 

The quantity of products that people are willing to buy at different prices at specific time.

Supply

The quantity of products that manufacturers or owners are willing to sell at different prices at specific time.

Equilibrium Price

The market price where the quantity of a good or service that consumers want to buy exactly matches the quantity that producers want to sell.

Deflation

A situation in which prices are declining.

Inflation

The general rises in the prices of goods and services over time.

Business Cycle

The periodic rises and falls that occur in economies over time. 

Recession

Two or more consecutive quarters of decline in the GDP.

Fiscal Policy

The federal government’s efforts to keep the economy stable by increasing or decreasing taxes or government spending.

Monetary Policy

The management of the money supply and interest rates by the Federal Reserve Bank.