Introduction to Business Concepts

Multiple Choice Questions

• Question 1: Business is the term for all activities involved in developing and exchanging products.
• Question 2: The customer of a service business is often called a client.
• Question 3: Anything that is bought or sold is called a product.
• Question 4: Customers who buy goods and services for their own use are called consumers.
• Question 5: Utility is added to a product when a business changes its form, making it more useful.
• Question 6: A market is a place where buyers and sellers meet to buy and sell goods and services.
• Question 7: The difference between a business's income and expenses is called profit.

Additional Questions/Concepts

• Question 8: Economics is the science that examines how goods and services are produced, sold, and used.
• Question 9: A market economy is one where economic decisions depend on a society's values, culture, and customs.
• Question 10: The law of supply and demand says that the price of a product is determined by how much is available and how much people want it.
• Question 11: Gross domestic product (GDP) is the market value of all final products produced in a country during a specific period.
• Question 12: The four components of GDP are consumer spending, business investment, government spending, and net exports.
• Question 13: The inflation rate measures the rate of change in prices over time.
• Question 14: Deflation is a general decline in prices throughout an economy.
• Question 15: The interest rate represents the cost of a loan, expressed as a percentage of the amount borrowed.
• Question 16: Non-price competition is a competitive advantage based on factors other than price.
• Question 17: Commerce is the activity associated with buying and selling goods on a large scale.
• Question 18: The money supply is the total amount of money circulating in a country.
• Question 19: Fiscal policy involves the tax and spending decisions of the government.
• Question 20: Collusion refers to when two or more businesses work together to remove competition, set prices, or control distribution
• Question 21: Company policy or procedure outlines how company decisions are made.
• Question 22: An organization chart identifies the hierarchy of employees within a business.
• Question 23: The hierarchy structure of a company shows the authority/structure of the company from the highest to lowest positions.
• Question 24: Management is the process of controlling and making decisions about a business, including finance, marketing, or production.
• Question 25: Strategic plans are created for long-term goals of an organization, tactical plans are for short-term goals, and operational plans are for day-to-day goals.
• Question 26: Compensation is the process of recruiting, hiring, training, evaluating, and compensating employees.
• Question 27: Theory X managers believe employees need close supervision, while Theory Y managers believe employees are motivated and self-directed.
• Question 28: Time management is the practice of organizing time and work tasks to increase efficiency.
• Question 29: Critical thinking is the ability to analyze a situation, interpret information, and make reasonable decisions.
• Question 30: Group dynamics are the interacting forces within a group.
• Question 31: Financial institutions offer a variety of products and services including loans, deposits etc
• Question 32: Investing is purchasing financial products to increase wealth over time.
• Question 33: A bank statement is a record of transactions made in an account.
• Question 34: An investment portfolio is a collection of securities and other assets owned by a person.
• Question 35: A certificate of deposit (CD) is a savings account that requires a fixed deposit amount for a fixed period.
• Question 36: A Traditional IRA is an individual retirement account in which individuals contribute after-tax income and qualified withdrawals are not taxed.
• Question 37: A mutual fund is an investment created by pooling money from many people to invest in securities.
• Question 38: A financial plan is a strategy for using money to achieve important goals and financial security.
• Question 39: An endorsement is a signature on the back of a check.
• Question 40: P2P (person-to-person) payments are a service offered by banks to transfer money directly between people.
• Question 41: An opportunity cost is something given up to gain something else.
• Question 42: Capital goods are products that businesses use to produce other goods.
• Question 43: A service is an action that is performed for a fee.
• Question 44: A product is something that can be bought or sold.
• Question 45: An economic system is an organized way in which a nation uses its resources to create goods and services.
• Question 46: Competition occurs when businesses try to attract the same customers.
• Question 47: Scarcity refers to when demand is greater than resources available.
• Question 48: A customer is an individual who buys products.
• Question 49: Capitalism is an economic system where economic resources are privately owned by individuals instead of the government.

Additional Business Concepts

• Question 50: Standard of living is the level of material comfort based on goods, services, and luxuries available.
• Question 51: Human resources include the people who work in a business.
• Question 52: Entrepreneurship is the willingness and ability to start a new business.
• Question 53: A business requires tools, equipment, and machinery to produce goods or services.
• Question 54: The value of the next best option that was not selected is an important concept in economics.
• Question 55: Needs are things a person must have, while wants are things they desire.

Test your knowledge on fundamental business concepts with this quiz. It covers essential definitions and principles such as products, consumers, utility, market economics, and profit calculations. Perfect for beginners looking to understand the basics of business and economics.