Economics Multiple Choice Questions - PDF

MCQ 5.1 1.​ What is a sole proprietorship? a.​ a business owned and managed by a single individual. 2.​ Know advantages and disadvantages of sole proprietorship a.​ (advantages) Easy to start, minimum requirements, few regulations, sole receiver of profit, fu...

MCQ 5.1 1.​ What is a sole proprietorship? a.​ a business owned and managed by a single individual. 2.​ Know advantages and disadvantages of sole proprietorship a.​ (advantages) Easy to start, minimum requirements, few regulations, sole receiver of profit, full control, can choose their business rather easily. (disadvantages) if it fails the single person pays all the debt, may have trouble borrowing money with a bank. And then Limited life/ Limited Permanence. MCQ 5.2 1.​ In a general partnership all parties share equally in both responsibility and liability 2.​ Major Advantages of General Partnership vs Sole Prop is the responsibility for the business is shared 3.​ Disadvantage of a partnership is that if the business fails, ALL the partners are responsible for the debt 4.​ Major Advantages of a franchise is the parent company provides guidance on running the business MCQ 5.3 5.​ What is a corporation and who owns it a.​ legal entity owned by individual stockholders 6.​ What % of the nation’s income is generated by corporations? a.​ 60% is generated by corporations 7.​ What is the difference between a corporation and other businesses? a.​ A corporation has a separate legal identity from its owners 8.​ What is a disadvantage of a corporation in regards to taxation a.​ Double taxation - corporation must pay taxes on profits & then stockholders pay taxes on dividends 9.​ What is a horizontal merger and why would government be concerned about it a.​ A combination of two or more firms competing in the same market with the same goods and service. The government be concerned that a horizontal merger would reduce competition MCQ 5.4 10.​What is a cooperative (co-op) and who controls it? a.​ Control of the organization by its members b.​ A type of business organization owned and operated by a group of individuals for their shared benefit 11.​What is a non-profit? a.​ like a business but do not operate for the purpose of generating profit 12.​What is the common goal of a nonprofit organization? a.​ To benefit the public some how MCQ 5.4 13.​Who is considered employed? a.​ 16 or older b.​ One of the requirements is working 15 hr or more without pay in a family business 14.​Give an example of a employed person a.​ Full time college student who works 10 hours per week 15.​How can one earn higher wages a.​ One action a worker can take to earn higher wages is to get more education or training 16.​What economic concept decides how high wages will be? a.​ Supply and demand control wages 17.​How did the ratio between benefits and wages change after 1975 a.​ Benefits now count for a higher percentage of total earning b.​ What you receive in benefits, has increased quite substantially Matching: Entrepreneurs- are risk taking individuals. Must be willing to assume total responsibility Sole Proprietorship- is a business owned and managed by a single individual. Business license - permission from local gov’t to do business Fringe benefits - extras given to workers other than wages Partnership - is a business organization owned by two or more persons who agree on a specific division of responsibilities and profits Business franchise - is a semi-independent business that pays fees to a parent company Corporation- legal entity owned by individual stockholders Conglomerates- when three or more business that produce unrelated products or services merge. Multinational corps- the worlds largest corporations and they sell there goods and services in more than one country. Cooperative- A type of business organization owned and operated by a group of individuals for their shared benefit Nonprofit organizations- Function like a business but do not operate for the purpose of generating profit h