SSEMI1&SSEMI3

The Market for labor would be considered a ______________ market.

• Product
• Factor
• Wage
• Monopolistic

Amy is excited because she just opened her own consulting firm. Amy loves being her own boss and not having to consult with anyone else before she makes decisions.  Eventually, She even hopes to incorporate and enjoy some additional tax advantages. The only downside is t that she has invested all the money herself.  If the business fails, she could go bankrupt. What kind of business does Amy own? 

• Sole Proprietorship
• Partnership
• Cooperative
• Corporation

Which of the following is TRUE regarding households, businesses, and government in the US economic system?

• Households pay taxes to the government but businesses dont
• Households act as consumers while government and businesses act only as producers
• The three are economically interdependent on one another
• Government regulates what businesses can produce but not what consumers can buy

An industry dominated by a few large firms is

• Monoplistic
• Monopolistic-ally competitive
• Oligopolistic
• Perfectly competitive

Darren owns his own plumbing business. He spends some of his company's profits on new pipes and tools.  Jennifer then hires Darren and his assistant to install a new septic tank in her back yard.  Which of the following statements is  TRUE?

• Darren is labor and Jennifer is entrepreneur
• Darren is the entrepreneur, Jennifer's yard is the land, and Darren's assistant represents capital
• Darren bought his tools in a factor/Resource market and Jennifer paid for his services in a product market
• Darren's company reprsents a household

Taylor is thinking of leaving the big corporation he works for and starting his own firm.  He comes to you for advice and asks you what you think.  As a friend, you might want to warn Taylor that starting his own firm will mean that he has

• no risk
• to be prepared to sell stock in his company
• unlimited liability
• no way to get a loan

Susan, Phil, Robert, and Martina are all lawyers.  After several years of working for big firms, they decide to pull their resources and start their own law practice together.  The four of them will make all their business decisions together and will share all of the profits and financial risk. Their new law firm is a 

• Sole proprietorship
• Major corporation
• Partnership
• Franchise

Which is NOT a condition for a monopoly to exist?

• A single seller
• No close substitutes
• Difficult market entry
• High demand for a good

According to the circular flow diagram, how is the price of CEO's services determined?

• The interaction of buyers and sellers in the product market
• By supply and demand in the resource market
• Whatever a business will pay them, they will take
• According to how many Households will provide CEO's

What is the main difference between pure competition and monopolistic competition?

• Firms in pure competition make more profits
• Firms in pure competition rely more heavily on advertising
• Firms in pure competition have no substitutes to their goods
• Firms in pure competition are selling nearly identical, rather than differentiated goods