ADMS 1000 Chapter Notes - Chapter 2: Retail, Economic System, Business Cycle

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chocolatesea-lion294

3 Dec 2013

School

York University

Department

Administrative Studies

Course

ADMS 1000

Professor

Peter Khaiter

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ADMS 1000 Full Course Notes

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Business: an organization that produces or sells goods or services in an effort to make a profit. Profit: is what remains after a business"s expenses have been subtracted from their revenue. The prospect of earning profits is what encourages people to start and expand business. Not for profit organizations: do not try to earn profit; use the funds they generate to provide services to the public. Economic system: allocates a nations resources among its citizens. Economic systems differ in terms of who owns and controls theses resources, know as the factor of production. Key difference between economic system is the way in which they manage the factors of production. Factors of production: the basic resources that a country"s businesses use to produce goods and services. Labour: the people who work for a company represent labour. Labour is the mental and physical capabilities of people.

Related Questions

How does voluntary trade promote economic progress?

A) It makes individuals self-sufficient.

B) It encourages businesses to seek lower per-unit costs by adopting mass production methods.

C) It discourages trade on the basis of comparative advantages.

D) It moves goods, services, and resources from people who value them less to individuals who value them more.

coralwombat905

Part 1.Choose the correct answer of the following:

1.In a market economy, economic activity is guided by

a.Self-interest and prices

b.The government.

c.Corporations.

d. Central planners.

2. Which of the following decisions must be made by all economies?

a.How much to produce? When to produce? How much does it cost?

b.What to produce? How to produce? For whom to produce?

c.What is the price? Who will produce it? Who will consume it?

d. None of the above

3.Since the resources used in the production of goods and services are limited, society must:

a.Reduce the use of those resources

b.Try to get more resources

c.Make choices about how to use resources

d.Focus on their most abundant resource

4.Which of the following observations was made famous by Adam Smith in his book The Wealth of Nations?

a.Households and firms interacting in markets are guided by an "invisible hand" that leads them to desirable market outcomes.

b.There is no such thing as a free lunch.

c.People buy more when prices are low than when prices are high.

d. No matter how much people earn, they tend to spend more than they earn.

5.If real GDP increased by 2 percent, then

a.Government spending increased by 2 percent

b.The price level has increased by 2 percent

c.Real output/production has increased by 2 percent

d. The increase might have been caused by an increase in the price level or output, but we cannot tell for sure

6. Which of the following would show an efficient economy?

a.Uses the least costly amount of resources available

b.Has a small amount of people who do not work

c.Resources are used to make the most goods and services possible

d.None of the above

7.What is the type of unemployment that occurs when people take time to find a job?

a.cyclical

b.frictional

c.Disguised

d.structural

emeraldoyster872

As a general rule, cities are non-profit organizations and elected officials hire managers to operate the various departments which provide services (e.g., trash collection, street repair, etc.). Suppose cities of all sizes across your state/province/region become profit-seeking corporations. They will issue stock, the stock will be traded on a national exchange (e.g., NYSE), they will have a Board of Directors which will appoint all city officials. Any economic agent with the means may purchase stock. As usual, shareholders will elect members of the Board. Furthermore, the city will no longer be permitted to tax any economic agent (i.e., household, consumer, or business). Assume all stockholders have a share of ownership in the city.

a) Will the new system increase or decrease incidents of Moral Hazard by city officials/managers compared to the old system? Explain your answer. Note: First you must clearly state a given city manager's objective. Then compare the incentives this manager faces under the two systems.

b) List and discuss 2 externalities (positive or negative) that would result from having for-profit cities. Clearly, state who the recipients are of the externalities as well as the source(s). Remember to choose and clearly state a primary activity.

(Some cities (e.g., Cincinnati, Ohio) have a City Manager who runs the day-to-day operations. The elected officials appoint this individual and s/he has no policy-making authority. It is simply an administrative

champagnerat497

ADMS 1000 Chapter Notes - Chapter 2: Retail, Economic System, Business Cycle

ADMS 1000 Full Course Notes

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