Economics Quiz 1 (Lesson 6)

What is the first word that comes to mind when you hear the word franchise?

• Independence

• Chain

• Small

• Unique

What are some of the characteristics of a franchise that make it appear to be a public entity?

• Unique branding

• Independent management

• Standardized products

• Localized marketing

What are some of the characteristics of a corporation that make it appear to be a private entity?

• Publicly traded shares

• Personal liability

• Limited number of owners

• Centralized management

Why have small businesses historically been the backbone of the US economy?

• They employ a large portion of the workforce

• They have a global presence

• They focus on high technology

• They are all franchises

What might elasticity of supply impact a businesses’ decision to go public?

• It determines the CEO's salary

• It affects the company's stock prices

• It influences the ability to quickly increase production

• It impacts the number of shareholders

What is a balance of trade?

• The difference between a country's imports and exports

• The total value of a country's currency

• The equilibrium price in a market

• The balance between public and private companies

When talking about GDP are we talking about imports or exports?

• Imports

• Exports

• Both imports and exports

• Neither imports nor exports

Which type of business organization is characterized by one owner who pays personal income tax on profits from the business?

• Corporation

• Partnership

• Sole Proprietorship

• LLC

What is a disadvantage of a Sole Proprietorship?

• Easy accounting

• Own boss

• Unlimited responsibility/liability

• Develop relationships with people

In a Partnership, how are the owners responsible for the business debts?

• They are not personally liable for business debts

• Only one owner is personally liable for business debts

• Both owners are equally and personally liable for business debts

• Owners are liable up to the amount they invested in the business