Praxis Business 5101 ( Questions With complete verified solutions already graded A+ 2025-2026)

Command Economy

Govt. Controlling Prices & Production

Security&Exchange Commission(SEC) responsibilities:

Regulate securities, investigate insider trading, process applications for initial public offerings(IPO's)

Product demand is directly influenced by:

Customer's desire for product and ability to obtain product

Sarbanes-Oxley Act of 2002

Fight corporate & accounting fraud

Buyer's Market

Product availability exceeds demand

Maslow's hierarchy of needs

Self actualization, esteem, safety

NAFTA

North American Free Trade Act (Only countries connected to North America are part: Canada, USA, Mexico)

Debt Repayment History

How well you payed stuff back (Directly influences consumer credit)

World Trade Organization (WTO)

Deals with claims of unfair protectionism by 1 country against another

#1 factor that leads American companies to manufacture overseas:

Lower Labor Costs

Accounting equation for sole proprietorship:

Assets=Liabilities+Owner's Equity

Powerpoint

Microsoft presentation program- great for presenting business plans, etc.

Important tools for starting online business:

Business model, website, email address

Assets that can depreciate(lose value) over time

Heavy equipment(bulldozer), computers, company vehicles

These are deductible when itemizing on tax return:

Mortgage interest, charitable donations, losses from theft

Franchise

Individual pays to enter into an agreement with a company to use the company's business model in certain area

Par Value of a Bond

Amount paid when the bond matures

Freddie Mac (1970) was set up to:

Expand opportunities for home ownership

If US Federal Reserve sees risk of inflation they will:

Raise interest rates

Stagflation

Combination of slow economic growth and high inflation

Stock Dividends

Usually taxable, offered voluntarily by companies to make their stock more attractive, may be discontinued or stopped at any time

P/E ratio

Comparison of price of stock vs. its ability to earn money per share (Price/Earnings)

US Treasury Bonds

Govt. bonds that offer safe investment

Dow Jones Industrial Average

Stock trading market for well known corporations with large market capital

1st step in planning to start small business

Assess personal financial situation

Net Exporter

Value of goods exported by country exceeds value of goods imported by country

Import tariff

Fee country attaches to imported products to protect domestic products from foreign competition

Credit score affects the following things:

Buying a car, buying a home, getting a personal loan

Comprehensive car insurance

Covers damage done to insured's vehicle

Oil price increases caused by:

Increased global demand, speculation in oil market, not enough oil refinery capacity