BUS Test 1 Review

In the context of business ethics, ________ involves clear misconduct, unlike an ethical dilemma that involves a conflict of values

an ethical lapse

A drawback of communism, which was adopted by some countries in the 1900s, was the inability of people to make basic choices such as where to work or what to buy

true

Gross Domestic Product (GDP) levels tend to be somewhat understated, since they don't include any illegal activities, which can represent a significant portion of some countries' production

true

In the context of bonds, the current yield expresses a bond's interest payments as a percentage fo the bond's present market price rather than its par value

true

Lily, a salesperson at a clothing store, observes the department head misbehaving with a customer. She brings the issue to the notice of the store manager, and the offender is immediately dismissed from his job. In this scenario, Lily is a _____

whistle-blower

Lydia sells her ancestral property for a handsome amount of money. She invests this money in various securities. She decides not to trade the securities for a while and lets her money increase with the growth of the overall market. However, after almost 8 years, when she feels that the value of the securities has risen considerably, Lydia sells her stocks and receives high returns on her investment. In this scenario, Lydia has used what investment strategy?

Buy-and-hold

When the industries in a country tend to produce products that have the lowest opportunity cost relative to other countries, the country most likely has a __________

Comparative advantage

Despite the growth rates in many high-population countries being weak, most of these nations remain ahead of the United States in terms of development and prosperity

False

In the context of the strategies for reaching global markets, franchising is a strategy to seek foreign suppliers.

False

The traditional retirement age in the United States is 60

False

stakeholders refers to groups of people who have a malicious intent toward an organization who often resort to harmful actions.

False

CuberTech, an American electronics company, set up its production facilities in Chuaga, an Asian country, because the workers in Chuaga work for about one-third the pay of American workers. This substantially lowered CuberTech's cost of production. This scenario is an example of _____?

Foreign Outsourcing

In the context of global trade, what is true of balance of payments?

It includes foreign borrowing and lending

Vieorien, a company based in the country of Dannistel, has permitted a foreign company the rights to produce its products and to use the Vieorien trademark. However, Vieorien does not have the authority or the rights to dictate the business operations of the foreign company. In this scenario, the foreign company that Vieorien deals with is the _____?

Licensee

Alice, the global marketing director of a multinational electronic goods manufacturing firm, is the assigned the task of expanding her firm in new markets. She learns that hiring labor is expensive and that the required technical manufacturing equipment is unavailable in the international market. In this scenario, what is most likely affecting the global trade of Alice's firm?

Limited access to factors of production

Nescat Autos, an automobile manufacturing company, developed a secondary market for its products in a foreign country. This allowed the company to minimize its losses when its primary market failed to generate enough revenue to benefit the company. In this scenario, what is most likely to have influenced Nescat Auto's decision to set up a market in another country?

Reduced risk

Adhering to a new act passed in 2002, the CEO of Pearsil & Pearsil, now personally certifies the validity of the company's financial statements. Given this info, the CEO most likely follows the ________

Sarbanes-Oxley Act

Nakato, a south Asian country, exported goods worth $500 million and imported goods worth $400 million in the last fiscal year. The country also made foreign investments worth $300 million and provided foreign aid worth $100 million in disaster relief. Besides this, the country took a loan of $5 billion from the World Bank. This flow of money into and out of Nakato is measured by _______?

The balance of payments

In the context of American business, what is true of the marketing era?

The balance of power shifted away from the producers and toward customers

What does the following statement exemplify? An Asian country that increases its production of sugar by decreasing its production of cocoa

The concept of opportunity cost

Barter Bate, a wholesale store chain, was the first in the city to launch an online shopping website. Its website allowed customers to select required products and collect them from the nearest Barter Bate outlet. In this context, what dimension of the business environment is affected the most?

The technological environment

What is true about this statement? An Asian country whose total value of exports exceeds its total value of imports

This country has a trade surplus

Although a true deficit signals the wealth of an economy that can afford to buy huge amounts of foreign products, a large deficit can be destabilizing

True

In the context of the barriers to international trade, per capita income is a key factor that determines the economic differences between two countries

True

In the foreign licensing, licensors run the risk that unethical licensees may become their competitors, using information that they gained from the licensing agreement

True

each year, the Federal Open Market Committee holds eight regularly scheduled meetings to make decisions about open market operations

True

Clark and Nestor start a catering business together. They sign a legal contract that states that the business is owned by them. The agreement also states that they will have an equal share in the profits of the business and will be equally liable for any losses incurred by the business. This scenario exemplifies _______

a partnership

finwes is an advertising company. Because of certain untoward incidents in the company, the management decides to create a formal written document that would guide the employees in making right decisions in various professional situations. In this scenario, the management wants to create a ________

code of ethics

Andy invests in Oregon Corp, a plastic manufacturing company. As a stock holder, he owns a part of the company and he holds the right to vote on company issues. However, he is entitled to dividends only when the company's board of directors decides to declare them. According to the company policies, if Orelon Corp. faces dissolution in the future, Andy will receive his assets only after the company satisfies the claim of the preferred stockholders. Based on the given information, it can be concluded that Andy is a ________

common stockholder

In __________, firms either acquire foreign firms or develop new facilities from the ground up in foreign countries

direct investment

ananda is an entrepreneur who believes in providing equal opportunity to people regardless of their age, gender, race or religion. She is open-minded and detest the idea of taking advantage of others. In the context of universal ethical standards, Anaida most likely possess the core value of ______

fairness

Corporate etiquette is the obligation of a business to contribute to society

false

In the context of business behavior, producing products that you know will break before their time is illegal and unethical

false

In the context of federal debt, if spending is lower than revenue, the government incurs a budget deficit

false

Reserve requirement is a rule of the Fed which requires that all of its member banks hold funds which are more than the stated percentage of the deposits held by their customers

false

in the context of monetary policy, the money supply includes credit cards

false

in the context of your career choice, your own business skills cannot influence the level of your personal financial success.

false

One core responsibility of business is to deliver consumer value by providing quality products at fair prices

honesty and communication

The chairman of a welfare organization asks an employee to head a fundraising activity. The employee, however, embezzles $250,000 from the funds raised from the activity and falsifies financial records. In this scenario, the behavior of the employee is ______

illegal and unethical

Prost was the first automobile company in the world to introduce child safety locks in its vehicles. This feature soon became a major selling point for consumers all over the world. As a result, other automobile companies began providing a similar feature in their vehicles. In this scenario, what has influenced other companies to install child safety locks?

inflow of innovation

True statement of international trade.

it offers companies an invaluable source of new ideas

What is formed when two or more companies share resources, risks and profits without actually merging, to pursue specific opportunities

joint venture

to achieve its basic mission of promoting international economic cooperation and stable growth, the international Monetary Fund (IMF) does what?

lends money to member nations

When a business brings in less money than it needs to cover expenses, it incurs a _______

loss

The advantage of electronic communication networks (ECNs) is that they....

make it possible for investors to trade securities after the US exchanges are closed

Universal ethical standards can solve the problem of too many people viewing ethics as

relative

Fritzman Inc., a market research company, stocks its office pantry with an array of organic drinks and snacks to promote healthy eating habits among its employees. It also provides all its employees a free membership to a local gym. These gestures are Fritzman Inc.'s idea of __________

social responsibility

Resorto, a European country exported sugar with $600 million between 2015 and 2016 and imported tea worth $750 million during the same period. In this scenario, Resorto most likely had a ______ between 2015 and 2016

trade deficit

T o F about exporting: it represents an especially strong opportunity for small and mid-sized companies

true

sustainable development means weaving environmentalism throughout the business decision-making process

true

the structure of the Board of Governors of the Federal Reserve is such that no single president can appoint all of the Board's memebrs

true

in the context of the history of American business, what was a result of rapid industrialization in America from the mid 1700s to the mid 1800s

unprecedented production efficiency.