CHAPTER 3 STUDY GUIDE
Name ______
Period ______
Due Date ______
1. P.53 Economic institutions: Name three we frequent. (Ex. JCPenney)
1.
2.
3.
2. Throughout the chapter and section 3, a number of economic institutions are mentioned. List them.
1.
2. Cooperatives: (3 types)
3.
4.
5. Government: plays a dual role. It may be a direct or an indirect role.
It had a direct role in the economy as it owned and operated the TVA.
What is the TVA?
Define: indirect role:
3. There are 3 types of business organizations. Sole proprietorship, partnerships, and corporations.
a. ______is the most common form of business. It does % of sales and is relatively profitable, earning about of the profits. (74% are sole pros)
4. Advantages and strengths:
1.
2.
3.
4.
5.
6.
7.
5. Weaknesses of sole proprietorships:
1.
2.
3.
4.
5.
What does the phrase "fringe benefits" mean?
6. Partnerships account for _____% of business and _____profits, and _____sales. What are the two kinds of partnerships? 1) ______2)______.
What is the difference between them? ______
Partnerships are relatively easy to form . But formal papers called ______
are needed.
8. The strengths of a partnership are as follows:
1.
2.
3.
4.
5.
6.
9. The weaknesses of a general partnership are that
1.
2.
3.
(Characteristics: limited liability and unlimited life)
10. A corporation is "a very formal and legal agreement." A charter is a
11. Stockholders or shareholders earn ______.
12. If someone purchases stock they own ______.
13. Common stock represents ______.
14. Preferred stock represents ______.
15. Which type of business organization would make use of a proxy vote? ______
16. Why would I say that a bond is an I.O.U.? ______
17. What is the difference between principal and interest ______
18. List the economic strengths of a corporation.
1.
2.
3.
List its weaknesses:
1.
2.
3.
4.