1st business quiz

Body Language

Nonverbal communication that shows a speaker’s attitude or feelings.

Tone

The emotion or attitude conveyed through someone’s voice.

Spelling & Grammar

Show professionalism and care toward the receiver.

Want

A good or service desired but not necessary for survival.

Need

A good or service necessary for survival.

Profit

Total Revenue

Limited Resources

Consumers have fewer resources available to satisfy unlimited wants and needs.

Demand

Quantity of a good consumers are willing and able to buy.

Supply

Quantity of a good producers are willing and able to sell.

Demand Curve

Slopes downward from left to right.

Supply Curve

Slopes upward from left to right.

Equilibrium

Point where quantity demanded equals quantity supplied.

Equilibrium in Burger Graph

Price = $3; quantity = 600 burgers per week.

Shortage

Quantity demanded is greater than quantity supplied.

Surplus

Quantity supplied is greater than quantity demanded.

Competition

Can lead to better prices, quality, and choices for consumers.

Command Economy Competition

Generally has little or no competition because the government controls production decisions.

6 Demand Shifters

Complementary goods, tastes, income, population, substitute goods, future expectations.

Complementary Goods

Goods that are commonly used together.

Example of Complementary Goods

Cars and gasoline.

Tastes

If a product becomes more popular, demand increases.

Income

Higher income can increase consumers’ ability to buy goods.

Population

More people means more potential buyers and higher demand.

Substitute Goods

Goods that can be used instead of one another.

Example of Substitute Goods

Coke and Pepsi.

Future Expectations

Expectations about the future can cause consumers to buy more or less now.

Price Change and Demand Curve

A price change does not shift the demand curve; it causes movement along the curve.

Increase in Demand

Demand curve shifts right.

Decrease in Demand

Demand curve shifts left.

5 Economic Indicators

GDP, standard of living, unemployment rate, inflation/deflation, national debt.

GDP

Total value of goods and services produced in a country.

Standard of Living

Measure of overall quality of life and material well

Unemployment Rate

Percentage of the labor force without jobs but seeking work.

Inflation

General increase in prices over time.

Deflation

General decrease in prices over time.

National Debt

Total amount of money a government owes.

GDP Per Capita

GDP divided by the country’s population.

Real GDP

GDP adjusted for inflation.

Nominal GDP

GDP measured using current prices without adjusting for inflation.

Business Cycle

Rise and fall of economic activity over time.

4 Business Cycle Phases

Prosperity, recession, depression, recovery.

Prosperity

Period when the economy is growing and doing well.

Recession

Significant decline in economic activity.

Depression

Severe and prolonged economic downturn.

Recovery

Period when the economy begins improving after a downturn.

Recession

Depression?