Econ Test #2

Sole Proprietorship

A business owned and operated by one person, with no legal distinction between the owner and the business.

Partnership

A business owned by two or more people who share management responsibilities and financial obligations.

Corporate Bylaws

Rules established by a corporation to govern its own internal management.

C-Corporation

A standard corporation that is taxed as a separate entity from its owners.

LLC (Limited Liability Company)

A hybrid structure combining corporation-like liability protection with partnership-like flexibility.

Unlimited Personal Liability

Legal obligation where the owner is personally responsible for all debts and obligations of the business.

Pass-Through Taxation

Tax treatment that allows business income to be taxed on the owners' personal tax returns.

Consumer Price Index (CPI)

A measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

Demand Pull Inflation

Inflation that occurs when demand for goods and services exceeds supply.

Gross Domestic Product (GDP)

The total market value of all final goods and services produced within a country in a given year.

Core Inflation

A measure of inflation that excludes certain items subject to volatility, such as food and energy prices.

Fiscal Policy

The government's strategy for taxing and spending to influence the economy.

Monetary Policy

The Federal Reserve's management of money supply and interest rates to influence the economy.

Cost Push Inflation

Inflation caused by rising costs of production leading to increased prices.

Limited Partnership (LP)

A partnership that includes both general partners with full management rights and limited partners with limited liability.

Personal Consumption Expenditures Index (PCE)

An index that measures changes in the price of goods and services consumed by households.

Net Exports

The value of a country's exports minus the value of its imports.

Perpetual Existence

The ability of a corporation to continue existing independently of the owners.

EIN (Employer Identification Number)

A unique number assigned by the IRS for tax purposes to business entities.

DBA (Doing Business As) name

A trade name under which a business operates that is different from its legal name.

Investment

Business spending on land, buildings, equipment, and unsold inventory.

Joint and Several Liability

A legal concept where each partner is liable for the obligations of the partnership.

Regulatory Oversight

Government scrutiny and regulation of business operations and practices.

Self-Employment Tax

A tax on earnings from self-employment, encompassing Social Security and Medicare taxes.