Unit 4 - Businesses and Economic Growth

Multiple Choice

A town has new businesses opening, more jobs available, and more goods and services being produced. What is most likely happening?

• The economy is growing.

• The economy is shrinking.

• Businesses are becoming less productive.

• Consumers are spending less money.

Multiple Select

Which of the following factors can make one business different from another?

• Who controls the business

• Who carries the liability

• Who makes choices

• Who has access to capital

• Who advertises the product

Multiple Choice

A business owner wants to raise a large amount of money, protect personal assets, and bring in many investors. Which business structure would best fit those goals?

• Sole Proprietorship

• Partnership

• Corporation

• Franchise

Multiple Choice

What is a trade-off in decision making, and how does it affect the choices made by businesses, consumers, and governments?

• A trade-off means choosing the cheapest option so you can avoid giving something up.

• A trade-off means giving up one benefit to gain another when making a choice.

• A trade-off means delaying a decision until all possible benefits can be received.

• A trade-off means choosing the safest option so the decision has fewer consequences.

Multiple Choice

Which type of business ownership has the greatest access to capital, and why?

• Sole Proprietorship

• Partnership

• Corporation

• Cooperative

Multiple Choice

A landscaping company buys a new commercial mower to reduce labor time and serve more customers. Which idea is best illustrated?

• Private property lets firms use assets to improve productivity.

• Private property requires firms to share assets with competitors.

• Private property prevents government regulation of business assets.

• Private property guarantees that business investments earn profits.

Multiple Choice

Which of the following is NOT a component in the calculation of GDP?

• Consumption

• Investment

• Private Property

• Government Spending

Multiple Choice

Two countries have the same GDP, but one has a much smaller population. Which country will have the higher GDP per capita?

• The country with the larger population

• The country with the smaller population

• Both countries will have the same GDP per capita

• Population size does not affect GDP per capita

Multiple Choice

If prices rise by 5% but your income stays the same, what is the most likely effect?

• You can buy more goods and services.

• You can buy fewer goods and services.

• Your purchasing power stays the same.

• Your income automatically rises by 5%.

Multiple Choice

Which types of unemployment make up the natural rate of unemployment in the economy?

• Frictional and Structural

• Cyclical and Seasonal

• Structural and Cyclical

• Frictional and Seasonal

Multiple Choice

A factory worker loses her job because the company replaces many positions with automated machines. What type of unemployment is this?

• Frictional unemployment

• Cyclical unemployment

• Structural unemployment

• Seasonal unemployment

Multiple Choice

Which phase of the business cycle is characterized by rising real GDP, falling unemployment, and inflation that tends to rise?

• Expansion

• Peak

• Contraction (Recession)

• Trough

Multiple Choice

A company installs new machines that allow workers to produce more goods in the same amount of time. What is the most likely result?

• Productivity falls and economic growth slows.

• Production stays the same because resources are unchanged.

• Economic growth falls because fewer workers are needed.

• Productivity rises and economic growth can increase.

Multiple Choice

Which statement best explains how businesses and the economy are connected?

• Businesses make decisions that can affect productivity, jobs, prices, and economic growth.

• Businesses affect only the products consumers choose to buy and sell.

• Economic conditions change, but they do not affect business decisions or consumers.

• Business growth depends only on the number of workers hired.