Econ Ch. 8-9 Quiz

What is an entrepreneur?

• A person who manages a team of employees.

• A person who comes up with an idea, turns it into a marketable product, accepts the risk of success or failure, and claims any resulting profit or loss.

• A person who invests in stocks and shares.

• A person who works for a government organization.

What are the four types of creative changes in a market economy that entrepreneurs initiate?

• Introduce new laws, improve technology, new marketing strategies, and global expansion.

• Introduce new product, improve the quality of existing products, introduce new production methods, and introduce new ways of doing business.

• Create new job positions, reduce product prices, increase advertisement, and open new branches.

• Develop new training programs, enhance customer service, outsource production, and merge with other companies.

What is the money needed to start or expand a business called?

• Operational capital.

• Financial capital.

• Investment funds.

• Revenue.

What can an entrepreneur's profit also attract besides success?

• Government regulations.

• Competitors and substitutes.

• Employee dissatisfaction.

• Environmental concerns.

What is innovation?

• The process of creating a new business model.

• The process of turning an invention into a marketable product.

• The process of investing in new technology.

• The process of expanding a company internationally.

What is a sole proprietorship?

• A business owned by a group of investors.

• A business owned by a government entity.

• A business owned and run by a single individual.

• A business owned by multiple partners with equal shares.

What is the advantage of a sole proprietorship?

• Difficult to start, many Gov. Regulations

• Easy to start, keep all profits

• High tax rates

• Limited access to resources

What is the disadvantage of a sole proprietorship?

• Full liability (responsibility)

• Easy to start

• Few Gov. Regulations

• High profit retention

What is a partnership?

• A type of corporation

• A single-owner business

• A business owned and managed by a group of individuals

• A government-owned enterprise

What is the advantage of a partnership?

• Difficult to start

• Limited skills and capabilities

• More resources

• High tax rates