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► Med Misc 57 > Economic, Political And Business Forces > Flashcards

Economic, Political And Business Forces Flashcards

1
Q

Major components of economics

A
  1. Allocation and management of income and expenditures of a household, business, community or government
  2. Production, distribution and consumption or wealth
  3. Satisfaction of material needs or people
  4. Study of the world economy- macroeconomic survey
  5. Societal establishment of economic systems that serve as means of achieving society’s economic goals
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2
Q

Consumer price index (CPI)

A

Measures price changes of goods consumed by an urban family of four on a moderate income

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3
Q

Disposable income (DI)

A

The gross national product (GNP) minus depreciation, business and personal taxes and transfer payments (such as social security or welfare)

“The money in people’s pockets” to spend as they want

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4
Q

Federal Reserve discount rate

A

The rate at which the Federal Reserve Bank lends funds to its member banks

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5
Q

Gross domestic product

A

Measures value of all goods and services produced within a nation’s borders regardless of the nationality of the producer

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6
Q

Gross national product (GNP)

A
  1. Primary inductor of national economy
  2. Measures production in the economy by aggregating all goods and services produced by their current prices
  3. Measures only goods and services that have a market
  4. International comparisons are difficult
  5. Does not measure quality of life
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7
Q

Microeconomics

A

Deals with the economic behavior of individual units such as consumers, firms and resource owners

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8
Q

Macroeconomics

A

Concerned with behaviors of economic aggregates

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9
Q

Items considered macroeconomics

A
  1. GNP
  2. GDP
  3. Consumption
  4. Level of employment
  5. Investment
  6. Money supply
  7. Innovation
  8. International trade and production relationships
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10
Q

Net national product

A

GNP less capital consumption allowance

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11
Q

Capital consumption allowance

A

Allocated costs for depreciation of capital equipment

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12
Q

Political economy

A

Term used to describe the influence of political and social institutions on the aggregate economy

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13
Q

Prime rate

A

Interest rate that banks charge to their commercial customers (those with good credit ratings and lowest risk) for short term loans

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14
Q

Producer price index (PPI)

A

Measures the wholesale price of goods

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15
Q

Major economic systems

A
  1. Capitalism
  2. Communism
  3. Socialism
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16
Q

Capitalism

A
  1. Allows private ownership of property
  2. Income from property or capital accrues to the individual or firms that accumulate it and own it
  3. Firms are relatively free to compete with others for their own economic gain
  4. Profit motive is basic to economic life
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17
Q

Communism

A
  1. Production systems are government or state owned

2. Production decisions are made by official policy and not directed by market action

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18
Q

Socialism

A
  1. An economic system in which government owns or controls many major industries
  2. May allow markets to set prices in many areas
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19
Q

Economic indicators

A

Measure the relative standing of one economic system versus that of another

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20
Q

Economic indicators include

A
  1. GNP
  2. Net national product
  3. DI
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21
Q

Price indicators

A

Reflect a nation’s economic standing

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22
Q

Examples of price indicators

A
  1. CPI

2. PPI

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23
Q

Labor force statistics

A

Measure how many noninstituionalized people are currently working at paid jobs or are willing to work

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24
Q

Labor force

A

Employable population of the economy

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25
Q

Persons excluded in calculations of labor force

A
  1. Military
  2. Jails
  3. Hospitals/sanitariums (patients)
  4. Full time students
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26
Q

Unemployment statistics

A
  1. Indicate the number of people looking for paid work

2. Point to changes in the labor market

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27
Q

Interest rates

A

A percentage of a sum of money charged for its use

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28
Q

Two important interest rates

A
  1. Prime rate

2. Federal Reserve discount rate

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29
Q

Balance of trade

A

Refers to the net value of a country’s imports and exports of merchandise

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30
Q

Favorable balance of trade

A
  1. Country exports more than it imports

2. Surplus

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31
Q

Unfavorable balance of trade

A
  1. Country’s imports predominate

2. Deficit

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32
Q

Reasons American economy grew during the 1980s

A
  1. Decreased taxation (tax cuts) on businesses and citizens
  2. Deregulation of businesses
  3. Increased consumer spending, investment and construction
  4. Beginning trend of privatizing government services
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33
Q

Examples of businesses deregulated in the 1980s

A
  1. Telecommunications
  2. Air travel
  3. Banking
  4. Many others
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34
Q

Longest period of peacetime growth

A

1980s

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35
Q

Tax cuts had a —– impact of government revenue

A

Negative

36
Q

Planned spending and reform of national entitlement programs such as ——– and ——– were not politically supported

A

Medicare/Medicaid

Social security

37
Q

American government continued to spend —– than it took in; this ——- deficit spending by the government, resulting in —– deficits

A

More
Increased
High

38
Q

The United States went from the —– creditor nation to the ——- debtor nation in the global economy

A

Largest

Largest

39
Q

Negative effects on Americans living with high national budget deficits

A
  1. Higher interest rates
  2. Less money for investment
  3. Lower economic growth rates
  4. Less revenue to pay interest on debt
  5. Debtor status to foreign countries
  6. Lower sales of exports
  7. Long term decrease in the standard or living
40
Q

By the end of the 1980s the US government was….

A

In a recession

41
Q

Economic state of the nation in the 1990s

A
  1. Inflation rate fell
  2. US became more competitive in the worldwide marketplace
  3. Period of expansion and economic growth
42
Q

Current economic trends

A
  1. Competition will increase worldwide
  2. Competition will be augmented by the use of the Internet
  3. Increase of multinational corporations
  4. Expansion of career and investment opportunities aroud the world
43
Q

Unstable, poorly functioning economies produce the following results:

A
  1. Have greater difficulty finding jobs that match abilities and education
  2. Continually rising prices reduce the value of savings, affecting ability of people particularly retirees to retire
  3. Company managers have difficulty obtaining enough resources at reasonable prices
  4. Companies have difficulty distributing products and finding buyers to purchase
  5. Investment opportunities are hard to find
  6. Expending accumulated personal assets may be difficult because available goods and services may be limited and of poor quality
44
Q

In a thriving economy individuals and societies benefit in the following ways:

A
  1. People are working
  2. Families are receiving income and consuming goods and services
  3. Economic progress= access to technologically advanced products
  4. Strong market for technologically advanced products stimulates research and further progress
  5. Attractive to foreigners for investment of capital or purchasing goods
  6. Aids social progress
45
Q

A thriving economy aids social progress in the following ways:

A
  1. More students pursue a higher level of education
  2. Students then enter the workforce with a higher level of skill and knowledge
  3. Well educated workers function at a higher productivity level and this benefit the economy
46
Q

A thriving economy allows managers to accomplish the following:

A
  1. Plan production and personnel programs and services with reasonable confidence they will reap the benefits of the economy
  2. Evaluate company and individual performance factors that have an impact on their bottom line without being hindered by an unstable economy
  3. Expand business and add personnel
  4. Provide benefits and services to employees while still meeting shareholder expectations for profit or return on investment
47
Q

A well run economy facilitates….

A

Production and the exchange of goods and services

48
Q

Low unemployment that results from a thriving economy can result in the following:

A
  1. A change in the way companies staff their workplaces

2. Increasing options available to workers

49
Q

The number of outsourced temporary workers increased ——- between 1982 and 1988

A

580%

50
Q

In 2001, ——- workers considered themselves independent contractors

A

8.6 million

51
Q

About —— people work under alternative employment arrangements

A

13 million

52
Q

Examples of alternative employment arrangements

A
  1. Independent contractors
  2. Temporary help workers
  3. Contract workers
  4. On-call workers
53
Q

The transition of the national economy is from…

A

Protected markets to international competition

54
Q

A nation’s economic competitiveness depends on these characteristics

A
  1. Financial
  2. Industrial
  3. Demographic
55
Q

Examples of financial, industrial and demographic characteristics that determine an nation’s economic competitiveness

A
  1. Unemployment rate
  2. GNP
  3. Per capita income
  4. Average hours and conditions of work
  5. Distribution of wealth
56
Q

The economic competitiveness of a nation also depends on the ability of individual businesses to….

A

Sell their goods and services at a profit in domestic (national) and foreign markets

57
Q

America’s ability to prosper depends on the ability of US companies to produce and market goods and services that can compete successfully in terms of………….. when compared with those of other nations

A
  1. Price
  2. Quality
  3. Innovation
  4. Customization
  5. Serviceability
58
Q

After World War II, America became the leading economic power partly because of…..

A

The destructive impact of the war on the economies of Japan and Europe

59
Q

Postwar benefits, such as the GI Bill, provided….

A

Housing and educational opportunities to returning veterans

60
Q

The GI Bill provided housing and educational opportunities to returning veterans, thus creating….

A

A competitive labor force, boosting the construction industry and encouraging local community development

61
Q

National and global economies and industrialization surged from —- to —-

A

1953 to 1975

62
Q

Between 1953 and 1975 the world industrial output increased an average of —- per year

A

6%

63
Q

The postwar economic boom in the United States was facilitated by….

A
  1. The deregulation of industry

2. Industrial developments and manpower planning that occurred during the war

64
Q

Post World War II, business, no longer hampered by wartime government constraints, returned to ——– and focused on meeting ———

A

Free markets

Consumers’ needs

65
Q

During the immediate postwar decades, the world was divided into the following. Types of marketplaces

A
  1. Domestic

2. International

66
Q

In the immediate postwar decades US companies produced primarily for…..

A

Domestic or regional markets

67
Q

During the immediate postwar decades American companies led the industrialized markets with:

A
  1. Increasing technological advances
  2. Mass production
  3. Higher workers wages
68
Q

During the immediate postwar decades, ——- and ——- added to costs of American businesses

A

Government regulation

Collective bargaining

69
Q

Customers at home and abroad have become ——–, see,ing the best product at the mot affordable price without regard to ——–

A

Global shoppers

The country in which it was produced

70
Q

Imports to the US grew —— between 1975 and 2003

A

260%

71
Q

The increase in imports between 1975 and 1993 was fueled by…

A

Increase American purchasing power

72
Q

US exports account for the following economic benefits:

A
  1. One out of every six American jobs in manufacturing
  2. $115 billion annually in services
  3. One-sixth of all US agricultural production
  4. Almost 25% of America’s GDP, almost one trillion per year
73
Q

Declining economic competitveness means….

A
  1. Fewer jobs
  2. Increased unemployment
  3. Lower per capita income
  4. Larger budget deficits
74
Q

The economy entered a recession and business retrenched during the 1970s, affecting manufacturing by…..

A
  1. Decreasing mass production
  2. Decreasing job creation
  3. Decreasing wages
  4. Decreasing employment levels
75
Q

The national economy expanded in the 1980s, but American manufacturing lost its competitive edge to…..

A

Foreign competitors who could produce goods at a lower cost than American companies

76
Q

The US is no longer primarily an ———-

A

Industrialized nation, a producer of manufactured goods

77
Q

Now the US economy depends more and more on the production of……

A

Services and technlogy

78
Q

Industries are looking to place the following types of jobs “offshore”:

A
  1. Manufacturing
  2. High tech
  3. Some customer service jobs
79
Q

Why are some industries looking to place jobs “offshore”?

A
  1. Wages and operating costs are less
  2. Decrease expenses
  3. Increase shareholder value
80
Q

Since the 1990s, the US has been the leading provider of…..

A

Services and technology

81
Q

The recent explosion of Internet use has revolutionalized communications and….

A

Has fundamentally altered the way people live, work and conduct business in the national and global economies

82
Q

The economic competitiveness of the US has increased through the use of…..

A

Internet technology

83
Q

The use of Internet technology has resulted in….

A

A huge array of customized goods and services at increasingly affordable prices

84
Q

The vast increase in the use of technogy to conduct business and communicate with others in real time increases….

A

Competition and the ability to generate income and wealth

85
Q

Economics

A

Is concerned with the way in which limited resources are allocated

► Med Misc 57 (49 decks)

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