BUAD 210 - Test 1
Terms in this set (148)
1. Refer to Satellite Communications. Jonathan is operating in a ____ because he has the opportunity to decide what and how to do things. a. command economy
2. Refer to Satellite Communications. When hiring people, Jonathan thinks it is important to consider a. unilateral thinking.
3. Refer to Satellite Communications. Which company has the correct objective?
4. Refer to Satellite Communications. Now that Jonathan plans to open his own business, he needs to look at the factors of production. Which of the following is not a factor of production?
5. Refer to Satellite Communications. Jonathan's success will contribute to society. This is referred to as the
1. Refer to Home Inspirations. Hailey noticed that when sales were up, the economy was in a
2. Refer to Home Inspirations. Home Inspirations currently operates in a ____ environment.
3. Refer to Home Inspirations. Hailey feels that for productivity to improve, the company must practice
4. Refer to Home Inspirations. Hailey's goal of offering products with unique features and special services is called
5. Refer to Home Inspirations. Which of these statements is true?
Hailey feels that e-business is an important avenue to venture into.
1. Of the following, which is not considered a basic management function necessary to be an effective manager?
2. Cultural diversity represents
the differences among people in a workforce
3. The relationship between sales and profits can be written as
sales revenue expenses = profit.
4. For a business, stakeholders represent
all of the different people or groups who are affected by the business
5. Microeconomics is the study of
the decisions made by individuals.
6. Productivity can best be described as
the average level of output per worker per hour
7. Public utilities are often referred to as
8. When Microsoft copyrighted its Windows software, it established a(n) ____ monopoly.
9. The concept of sustainability focuses on which of the following?
The needs of the present without compromising the future
10. Which of the following issues will not be a challenge for our economy in the years to come?
How can individuals reinvest all the profits that have been made in the stock market as a result of the strong economy?
1. In our free-enterprise system, federal and state governments decide what products and services to provide.
2. Today, managers and employees are no longer concerned about cultural diversity.
3. The four resources that a business must use to operate successfully include material resources, human resources, financial resources, and operational resources.
4. The term stakeholders refers only to the people who have invested money in a business.
5. The factors of production include natural resources, labor, government assistance, and entrepreneurship.
6. The four basic questions in a capitalist economy are what to produce, how to produce, who should produce, and when to produce.
7. According to Adam Smith, under laissez-faire capitalism, each person should be allowed to work toward his or her own economic gain without government interference.
8. A market economy is sometimes referred to as a command economy.
9. The U.S. business system is commonly referred to as a mixed economy.
10. Command economies include capitalism, socialism, and communism.
1. Refer to Personal Wellness. Personal Wellness can be classified as operating in what type of industry
2. Refer to Personal Wellness. What is not one of the key reasons Personal Wellness would possibly fail?
3. Refer to Personal Wellness. In preparing the business plan, Angela would have incorporated all of these components except
4. Refer to Personal Wellness. A business plan should answer all of the following questions except
"Which accounting firm will audit the company?"
5. Refer to Personal Wellness. When Angela suggested that the company contact a group, what type of group was she referring to?
1. Refer to Mc-King Chicken. When Brian opens the Mc-King Chicken restaurant in his town, he would be known as the
2. Refer to Mc-King Chicken. Which of the following would not be an advantage of a franchise?
Success will cause another outlet to be opened nearby.
3. Refer to Mc-King Chicken. Which of the following would be an advantage for Brian?
Guidance from the franchisor
4. Refer to Mc-King Chicken. The international agency advising Mc-King would have recommended that it do all of the following except
understand that management must be from the home country to teach the new employees the way things are done.
5. Refer to Mc-King Chicken. The international agency advising Mc-King would have made which of the following recommendations?
Remember that strong local management is needed to keep an international franchise going.
1. A small business is all of the following except
dominant in its field.
2. Mary's cleaning business has several customers but is not dominant in its field. This is an example of a(n) ____ business.
3. Businesses such as flower shops, restaurants, bed and breakfasts, and automobile repair are good candidates for entrepreneurs because they
have a relatively low initial investment.
4. The industry concerned with the movement of goods from producer to consumer is?
5. Kim Nguyen is planning to open a boutique stocked with exotic imports from around the world. Most probably, this new business will be managed by
6. Which of the following statements is correct?
The risk of failure for women-owned businesses is lower than average.
7. Small businesses have traditionally added ____ new jobs to the economy.
more than their proportional share of
8. In her small retail shop, Jocelyn knows most of her best customers by name and knows their preferences in clothing and shoes. This demonstrates which advantage of a small business?
Personal relationships with customers
9. Your friend, Shonta, started a graphic design firm about a year ago. The business has done well, but it needs a lot more equipment, computers, and employees to continue expanding. Shonta does not see any problem because she thinks she can easily get all the money she will need from her local bank.
What advice might you give her?
She should consider alternative sources of financing because banks provide only about one-fourth of the total capital to small businesses.
10. Professors at most universities are highly encouraged to participate in community service. What organization that provides low-cost courses and workshops would welcome management professors with an interest in small companies?
1. The SBA has defined a small business as one independently owned, operated for profit, and not dominant in its field.
2. Small businesses are typically managed by people who started and own them.
3. Entrepreneurial spirit is the desire to create a new business.
4. Small businesses account for all nongovernment employment.
5. Society usually does not benefit from entrepreneurs who pursue their individual goals; it is only the entrepreneurs who reap the benefits of their own work and creativity.
6. John Wells, an African-American small business owner, might be eligible for a grant from the Minority Business Development Agency.
7. Franchising is limited only to fast foods.
8. In a franchise, the franchisee gets the opportunity to start a business with limited capital and to make use of the business experience of others.
9. All franchisors give geographical protection to their franchise holders.
10. International trade will become more important to small-business owners in the new century.
1. Refer to Samantha's Dilemma. Based on the information provided, what type of business does Samantha's aunt operate?
2. Refer to Samantha's Dilemma. What type of company does Samantha's friend operate?
3. Refer to Samantha's Dilemma. If Samantha worked for the large retail company in Philadelphia, what type of corporation would that be?
4. Refer to Samantha's Dilemma. What would not be an advantage of Samantha's aunt's business?
1. Refer to B&G, Inc. What type of organization is B&G, Inc.?
2. Refer to B&G, Inc. Which of these features does not belong to this type of corporation
3. Refer to B&G, Inc. What type of organization was Kevin considering switching to?
Refer to B&G, Inc. B&G, Inc. was going through a ____ merger.
1. Glenn owns and operates a large hardware store in Missouri that employs about fifty people. He delegates some of the decision making to two managers, but he remains the only owner. Glenn's business is organized as a
2. Laura wants to start a business, but she is unsure of the legal form best for her. Short of cash, she has decided to take the form that is the least expensive and most flexible in terms of decision making and implementation. Which would you recommend?
3. According to the text, which of the following statements is false?
When compared to larger businesses, the lure of employee benefits is one reason why peopl to work for sole proprietorships.
4. All of the following are disadvantages that Sean should consider before entering a partnership agreement with his cousin except
5. Susan has a commercial laundry service that has been growing rapidly. She wants to continue to grow the business, but she needs access to more money and does not want to risk her personal assets. Susan contacts her lawyer to see if all the legal requirements are met to start the process of
6. Common stock carries all the following rights except the right to
receive part of the profit before other classes of stock.
7. How can the following quotation best be explained: "Stockholders control the activities of a corporation"?
Stockholders elect the board of directors, and this board is responsible for appointing corpor officers who
manage the daily business of the corporation
8. A limited-liability company is
taxed like a partnership.
9. When many banks join together to lend money to developing countries such as Bangladesh and Malaysia, they seek to spread out the risk of default. This is called a. a not-for-profit organization.
10. A merger between firms in completely unrelated industries is known as a
1. The corporation, partnership, and sole proprietorship are the three most common forms of business ownership in the United States.
2. Unlimited liability holds a sole proprietor personally responsible for all the debts of the business.
3. Compared to a corporation, a partnership is more difficult and expensive to establish.
4. As with a sole proprietorship, one disadvantage of a partnership is a lack of continuity.
5. The Reader's Digest Association began as an open corporation and later changed to a closed corporation.
6. Common stockholders have the right to elect a corporation's board of directors and vote on corporate matters.
7. An S-corporation can have no more than twenty stockholders.
8. Joint ventures are created for a specific purpose and dissolved when that purpose is achieved.
9. A tender offer is an offer to purchase stock from existing stockholders.
10. A horizontal merger is a merger between firms in completely unrelated industries.
1. Refer to Landing Service. Because the company is known for its ability to produce lawn furniture more efficiently than any other company in the world, the company must have a(n) ____ advantage.
2. Refer to Landing Service. What type of tax has the Italian government imposed on the company?
3. Refer to Landing Service. What type of tax has the Brazilian government imposed on the company?
4. Refer to Landing Service. The Landing Service does mostly
5. Refer to Landing Service. Landing Service must have contacted which of these organizations to mediate regarding unfair treatment by foreign governments?
1. Refer to Lynn Bernerd, Inc. Initially, the managers believed that ____ would be the best option for entering the foreign market.
2. Refer to Lynn Bernerd, Inc. Which of the following options is not one of the steps needed for entering an international market?
Contact local government to see if taxes on trade can be waived.
3. Refer to Lynn Bernerd, Inc. Which agency should the managers at Lynn Bernerd, Inc. seek assistance from?
U.S. Export Assistance Centers
4. Refer to Lynn Bernerd, Inc. When the transport carriers notify the exporter that the product has been shipped, they use a
bill of lading.
5. Refer to Lynn Bernerd, Inc. Which of the following alternatives could have worked as a link between the managers at Lynn Bernerd, Inc. and the buyer from a different country?
1. Which of the following scenarios would not be considered international business?
A bearing manufacturer in South Carolina sells its parts to a Toyota plant in Kentucky.
2. If Japan were regarded as the best electronics manufacturer in the world, what would be true?
Japan would have an absolute advantage in electronics production.
3. Which of the following best defines balance of trade?
The total value of a nation's exports minus the total value of its imports over some period of time.
4. Globalization represents a huge opportunity for
all countriesrich or poor.
5. Several European countries have banded together to reduce the trade barriers between them and encourage trading among themselves. This is known as a
the European Union.
6. Suppose Gillette is seeking a manufacturer in Bangladesh that will produce and market Gillette razors in that country. Gillette expects a royalty from its partner in Bangladesh. Which arrangement will be the best choice for Gillette?
7. Janet hires an export merchant to help expand her business internationally. After signing contracts with a foreign purchaser outlining the terms of sale and delivery, the exporter will send Janet's merchandise when
Janet's bank receives a letter of credit from the importer's bank.
8. When Sony Corporation of Japan purchased Columbia Pictures Entertainment, Inc. of the United
States, Sony made a(n)
direct investment in the United States
9. Which of the following federal governmental agencies provides domestic and overseas commercial officers, country experts, and industry experts?
International Trade Administration
10. Which of the following is false concerning the International Monetary Fund?
Its loans to developing countries are interest free.
1. Absolute advantage is the ability to produce a specific product more efficiently than any other nation.
2. When the United States recently imported $1,933 billion in merchandise and services and exported $1,555 billion, it had a trade deficit.
3. Balance of payments is a much broader concept than balance of trade.
4. Political considerations usually are involved in a country's decision to impose a trade embargo.
5. Cultural barriers can impede acceptance of products in foreign countries.
6. U.S. trade restrictions benefit only a few industries while harming many others.
7. A bill of lading is issued by the transport carrier to the exporter to prove that merchandise has been shipped.
8. A draft is issued by the exporter's bank, ordering the importer's bank to pay for the merchandise and thus guaranteeing payment once it is accepted by the importer's bank.
9. Strategic alliances are partnerships formed to create competitive advantage on a worldwide basis.
10. A firm that has no ties to a specific nation or region and operates on a worldwide scale is called a national enterprise.
1. Refer to Excellent Air Incorporated. The principles that EAI chooses to pride itself on show that the company has
2. Refer to Excellent Air Incorporated. Initially, employees were not willing to go to EAI management with ethical issues but would instead report them to the press. This is an example of
3. Refer to Excellent Air Incorporated. To fix the ethical issue problems, EAI management should have implemented all of the following guidelines for making ethical decisions except which one?
Create an industry benchmark.
4. Refer to Excellent Air Incorporated. Since the company created its code of conduct, employees have limited ____, or amount of freedom to perform an unethical act.
5. Refer to Excellent Air Incorporated. EAI's creation of its code of conduct demonstrated its application of moral standards to business situations, which is also known as
1. Refer to XYZ Coffee. Nancy is a(n) ____ within her community.
2. Refer to XYZ Coffee. If Nancy were Caucasian and the company employees were mostly Hispanic, the way she was treated would be referred to as
3. Refer to XYZ Coffee. Before he got his job, another description for the employee who was hired over Nancy would be
4. Refer to XYZ Coffee. Which basic consumer right was infringed when Nancy bought the espresso machine?
The right to choose
5. Refer to XYZ Coffee. Nancy's right to product options in buying an espresso machine is known as
1. Customers expect a firm's products to
be safe, reliable, and reasonably priced.
2. Ranee is a businessperson who works for a successful and admired Fortune 500 company. About how often is Ranee likely to encounter ethical issues in the workplace?
On a daily basis
3. You are the executive vice president for Cooper Tire, the sixth largest U.S. tire maker. You have the responsibility to locate land for a new distribution center in Mississippi, and you own over 1,000 acres of land near one site in Tupelo. This could create for you
a conflict of interest.
4. You are the decision maker for purchasing office equipment in your organization. One sales representative privately offers you season tickets to the Chicago Bears if you help him out. This tactic is
A large computer manufacturer forbids its executives and managers from serving as directors or officers for Intel Corporation or any other corporations from which it might purchase component parts. The company is trying to prevent
a conflict of interest.
6. What are the three sets of factors that influence the standards of behavior in an organization?
Opportunity, individual factors, social factors
7. As a result of the Bhopal incident, in which a toxic gas leak killed thousands of people, leading officials at Union Carbide have dedicated themselves to operating their business ethically. Ways in which the company can encourage ethical behavior include all of the following except
requiring that ethical behavior be profitable.
8. Which of the following is the most effective way to encourage ethical business behavior?
Establish and enforce a corporate code of ethics.
9. A credit card company is offering an annual percentage rate of 3.9 percent. However, the company fails to mention that this is an introductory rate, and when consumers receive their bills after six months the rate increases to 21.9 percent. The consumers feel their right to ____ has been abused.
10. Anne's new necklace breaks the day after she purchases it. She tries to get it fixed or replaced and feels that she has been given the runaround by both the retailer and the manufacturer of the necklace. She is treated rudely and finally told she will have to drive two hours to a companyapproved repair center to have the necklace fixed. Anne is certain that her consumer right to ____ has been ignored by both companies.
1. The field of business ethics applies moral standards to business situations.
2. Relationships with customers and coworkers rarely create ethical problems.
3. Sponsors of advertisements aimed at children must be especially careful to avoid misleading messages.
4. Generally, social responsibility does not cost money.
5. Within a firm, social responsibility begins with management's attitude.
6. Much consumer-oriented legislation has grown out of the statement of six rights, which became known as the consumer bill of rights.
7. Manufacturers are not required by law to inform consumers about the potential dangers of using their products.
8. The right to choose means that consumers must have a choice of products offered by different manufacturers and sellers.
9. The lesser the competition, the greater the choice available to consumers.
10. A social responsibility program may be funded by the federal government through tax reductions or other incentives.
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