Business Management Test 1 Chapter 1 – Flashcards
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1. Businesses provide goods, jobs, and services to others.
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true
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2. Businesses seek to earn a profit by providing goods and services to others.
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true
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3. Revenue is the amount a business earns above and beyond what it spends for expenses and costs.
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false
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4. Profit is the amount of money a business earns above and beyond what it spends for salaries and other expenses.
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true
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5. If a business's costs and expenses are greater than its revenue, it will suffer a loss.
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true
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6. Revenue is the total amount of money a business takes in during a given period by selling goods and services.
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true
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7. The term "standard of living" refers to the amount of debt people can incur on a given income.
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true
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8. Stakeholders include customers, employees, stockholders, suppliers, dealers, bankers, government officials and environmentalists.
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true
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9. Outsourcing has caused many complications in many states where jobs have been lost to overseas companies.
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true
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10. Nonprofit organizations use financial gains to meet stated social or educational goals of the organization rather than personal profit.
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false
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11. The amount of profit or loss earned by a business can be found by subtracting the firm's expenses from its revenues.
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true
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12. Business decisions should consider the interests of customers, employees, suppliers, government leaders, and stockholders.
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true
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13. Insourcing creates new jobs, and helps offset the number of jobs being outsourced.
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true
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14. Backstreet Books, an eclectic bookstore on a large college campus generated total revenues of $15 million while incurring expenses of $12 million. During the year Backstreet Books earned a profit of $3 million.
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true
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15. Political freedom, quality education, access to health care, and a clean environment are all factors that contribute to an improved quality of life.
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true
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16. A charitable organization, such as the American Red Cross or Salvation Army, is classified as a for-profit organization.
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false
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17. An activity which seeks to earn a profit by providing a good or service is known as a(n):
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business
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is the amount a business earns after deducting what it spends for salaries and other expenses.
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profit
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is the amount a business earns after deducting what it spends for salaries and other expenses.
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profit
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is the amount a business earns after deducting what it spends for salaries and other expenses.
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profit
