Principles of Business, 10th Edition, Dlabay, Kleindl - Test Bank - All Chapters Covered

TEST BANK

PRINCIPLES OF BUSINESS
10TH EDITION

Chapter No 01: Economic Decisions and Systems
1. Things that are required in order to live are known as wants.
a. True
b. False

ANSWER: False
RATIONALE: Needs are things required in order to live. Wants are things that add to
the comfort and pleasure of your life.
POINTS: 1
REFERENCES: Needs and Wants
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: 1.1.1 - Compare and contrast needs and wants.




2. Goods and services are purchased by businesses as well as by individuals.
a. True
b. False

ANSWER: True
RATIONALE: Both businesses and consumers purchase goods and services.
POINTS: 1
REFERENCES: Goods and Services
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: 1.1.2 - Distinguish between goods and services.




3. Buildings, equipment, and supplies are examples of natural resources.
a. True
b. False

ANSWER: False
RATIONALE: Raw materials supplied by nature are natural resources, while capital
resources include buildings, equipment, and supplies.
POINTS: 1
REFERENCES: Economic Resources
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: 1.1.3 - Describe the types of economic resources.

,4. All economic resources have a limited supply.
a. True
b. False

ANSWER: True
RATIONALE: Economic resources are scarce, meaning they have a limited supply.
POINTS: 1
REFERENCES: Economic Resources
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: 1.1.3 - Describe the types of economic resources.




5. The basic economic problem results from not having enough resources to satisfy every need.
a. True
b. False

ANSWER: True
RATIONALE: Individuals and businesses have unlimited wants and needs. However,
the economic resources they can use to meet their needs are limited.
The gap between unlimited wants and needs and limited economic
resources is known as the basic economic problem.
POINTS: 1
REFERENCES: The Basic Economic Problem
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: 1.2.1 - Describe the basic economic problem.




6. The final step in the decision-making process is to select the best choice from among the alternatives.
a. True
b. False

ANSWER: False
RATIONALE: In the decision-making process, after choosing the best alternative, the
next steps are to act on your choice and then to review the decision.
POINTS: 1
REFERENCES: The Decision-Making Process
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: 1.2.2 - Explain the steps in the decision-making process.




7. Although all nations differ in the type and amount of economic resources they have, they all have the
same economic needs.

, a. True
b. False

ANSWER: False
RATIONALE: Nations differ in the types and amounts of resources they have as well
as in what they determine to be their important needs and wants.
POINTS: 1
REFERENCES: The Three Economic Questions
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: 1.3.1 - Identify the three economic questions.



8. Communism, as practiced in the former Soviet Union, refers to the private ownership of resources by
individuals rather than by the government.
a. True
b. False

ANSWER: False
RATIONALE: Under a command system called communism, the Soviet Union’s
resources were owned and controlled by the government.
POINTS: 1
REFERENCES: Types of Economic Systems
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: 1.3.2 - Differentiate among the main types of economic systems.



9. A person who buys and uses goods and services is called a consumer.
a. True
b. False

ANSWER: True
RATIONALE: Individuals who buy and use goods and services are consumers.
Businesses and governments also are consumers.
POINTS: 1
REFERENCES: Supply and Demand in a Market Economy
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: 1.4.1 - Describe supply and demand verbally and with graphs.



10. Generally, a lack of competition will result in lower prices for goods and services.
a. True
b. False

ANSWER: False
RATIONALE: When competition is limited, consumers cannot find good alternatives
and prices may be high due to a lack of competition.
POINTS: 1

, REFERENCES: Determining Price
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: 1.4.2 - Discuss how supply and demand affect prices of products and
services.

11. Which of the following is an economic need?
a. a new television
b. water
c. concert tickets
d. a loaded SUV

ANSWER: b
RATIONALE: Needs are things required in order to live and include food, water, clean
air, clothing, and shelter.
POINTS: 1
REFERENCES: Needs and Wants
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: 1.1.1 - Compare and contrast needs and wants.



12. Goods
a. are things you purchase only after your basic needs are met.
b. have no physical characteristics.
c. must be provided to you at the time you want to consume them.
d. are things you can see and touch.

ANSWER: d
RATIONALE: Goods are things that you can see and touch.
POINTS: 1
REFERENCES: Goods and Services
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: 1.1.2 - Distinguish between goods and services.

13. The largest producer of goods and services in the world is
a. Japan.
b. Russia.
c. the United States.
d. China.

ANSWER: c
RATIONALE: The United States is the largest producer of goods and services in the
world.
POINTS: 1
REFERENCES: Goods and Services
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: 1.1.2 - Distinguish between goods and services.