BUSINESS MANAGEMENT 101 FINAL EXAM STUDY GUIDE
1. Economic System
ANS A description of how a particular society distributes its resources to produce
goods and services
2. Communism
ANS First described by Karl Marx as a society in which the people, without regard to
class, own all the nation's resources On paper it appears efficient, but in practice, these
economies suffer from: low standards of living critical shortages of consumer goods high
prices corruption and little freedom
3. Socialism
ANS An economic system in which the government owns and operates basic industries
but individuals own most businesses
Most socialist countries are democratic and recognize individual freedoms
The socialist system may allow a higher standard of living and is more stable; but taxes
and unemployment are generally higher in socialist countries
4. Capitalism/ Free Enterprise
ANS An economic system in which individuals own and operate the majority of
businesses that provide goods and services
Pure capitalism or free-market system happens when all economic decisions are made
without government intervention; also called laissez-faire capitalism
Modified capitalism differs from pure capitalism as the government intervenes and
regulates business to some extent
, BUSINESS MANAGEMENT 101 FINAL EXAM STUDY GUIDE
5. Supply
ANS The number of products businesses are willing to sell at different prices at a
specific time
6. Demand
ANS The number of products consumers are willing to buy at different prices at a
specific time
7. Equilibrium Price
ANS the price at which the number of products supplied equals the amount of
products consumers are willing to buy at a specific time
8. Pure Competition
ANS The market structure that exists when there are many small businesses selling
one standardized product
9. Monopolistic Competition ANS Fewer businesses than in a pure competition and the
differences among the goods they sell are small
10. Oligopoly ANS The market structure that exists when there are very few
businesses selling a product
, BUSINESS MANAGEMENT 101 FINAL EXAM STUDY GUIDE
11. Monopoly ANS The market structure that exists when there is only one business
providing a product in a given market
12. Gross Domestic Product (GDP) ANS The sum of all goods and services produced in
a country during a year Does not include profits from companies' overseas operations
13. Budget Defecit
ANS The condition in which a nation spends more than it takes in from taxes
U.S. budget deficit has recently grown to record levels; remedies include raising taxes or
reduce spending
14. Business Ethics
ANS Principles and standards that determine acceptable conduct in business
15. Social Responsibility
ANS A business's obligation to maximize its positive impact and minimize its negative
impact on society a voluntary action taken on by companies to varying degrees and it
characterized by actions showing concern for all stakeholders such as employees,
consumers, the environment and the community
, BUSINESS MANAGEMENT 101 FINAL EXAM STUDY GUIDE
16. Sarbanes-Oxley Act
ANS Criminalized securities fraud and stiffened penalties for corporate fraud
Enacted after the accounting scandals in the early 2000's
17. Dodd-Frank Act
ANS Passed to reform the financial industry and offer consumers protection against
complex and/or deceptive financial products Enacted after the most recent recession
18. Ethical Issue ANS An identifiable problem, situation, or opportunity that requires
a person to choose from among several actions that may be evaluated as right or
wrong, ethical or unethical
19. Greenwashing
ANS (1) When a company claims they are green because they have a few green
practices such as recycling but not water or energy conservation
(2)When a company puts a façade on their products/services that looks and claims to be
green, when in fact there is nothing green about it
1. Economic System
ANS A description of how a particular society distributes its resources to produce
goods and services
2. Communism
ANS First described by Karl Marx as a society in which the people, without regard to
class, own all the nation's resources On paper it appears efficient, but in practice, these
economies suffer from: low standards of living critical shortages of consumer goods high
prices corruption and little freedom
3. Socialism
ANS An economic system in which the government owns and operates basic industries
but individuals own most businesses
Most socialist countries are democratic and recognize individual freedoms
The socialist system may allow a higher standard of living and is more stable; but taxes
and unemployment are generally higher in socialist countries
4. Capitalism/ Free Enterprise
ANS An economic system in which individuals own and operate the majority of
businesses that provide goods and services
Pure capitalism or free-market system happens when all economic decisions are made
without government intervention; also called laissez-faire capitalism
Modified capitalism differs from pure capitalism as the government intervenes and
regulates business to some extent
, BUSINESS MANAGEMENT 101 FINAL EXAM STUDY GUIDE
5. Supply
ANS The number of products businesses are willing to sell at different prices at a
specific time
6. Demand
ANS The number of products consumers are willing to buy at different prices at a
specific time
7. Equilibrium Price
ANS the price at which the number of products supplied equals the amount of
products consumers are willing to buy at a specific time
8. Pure Competition
ANS The market structure that exists when there are many small businesses selling
one standardized product
9. Monopolistic Competition ANS Fewer businesses than in a pure competition and the
differences among the goods they sell are small
10. Oligopoly ANS The market structure that exists when there are very few
businesses selling a product
, BUSINESS MANAGEMENT 101 FINAL EXAM STUDY GUIDE
11. Monopoly ANS The market structure that exists when there is only one business
providing a product in a given market
12. Gross Domestic Product (GDP) ANS The sum of all goods and services produced in
a country during a year Does not include profits from companies' overseas operations
13. Budget Defecit
ANS The condition in which a nation spends more than it takes in from taxes
U.S. budget deficit has recently grown to record levels; remedies include raising taxes or
reduce spending
14. Business Ethics
ANS Principles and standards that determine acceptable conduct in business
15. Social Responsibility
ANS A business's obligation to maximize its positive impact and minimize its negative
impact on society a voluntary action taken on by companies to varying degrees and it
characterized by actions showing concern for all stakeholders such as employees,
consumers, the environment and the community
, BUSINESS MANAGEMENT 101 FINAL EXAM STUDY GUIDE
16. Sarbanes-Oxley Act
ANS Criminalized securities fraud and stiffened penalties for corporate fraud
Enacted after the accounting scandals in the early 2000's
17. Dodd-Frank Act
ANS Passed to reform the financial industry and offer consumers protection against
complex and/or deceptive financial products Enacted after the most recent recession
18. Ethical Issue ANS An identifiable problem, situation, or opportunity that requires
a person to choose from among several actions that may be evaluated as right or
wrong, ethical or unethical
19. Greenwashing
ANS (1) When a company claims they are green because they have a few green
practices such as recycling but not water or energy conservation
(2)When a company puts a façade on their products/services that looks and claims to be
green, when in fact there is nothing green about it
