Business Dynamics

In the context of factors of production, which of the following is a natural resource?

Land

_____ refers to specific, short-term planning that applies strategic plans to specific functional areas.

Tactical planning

__________has a high channel richness, and especially with state-of-the-art equipment, it conveys much of the richness of actually being there.

Videoconferencing

Autocratic leadership tends to be the best option when:

a quick decision is paramount.

Data mining allows organizations to:

analyze vast amounts of data to identify useful information that had been hidden.

In the context of opportunities and threats, overhead costs for small businesses:

are often lower than big companies.

The three kinds of basic financial statements that are prepared in financial accounting are:

balance sheet, income statement, and statement of cash flows.

The overstating of needs or setting low budget goals by managers in a budgeting process can result in _____.

budgetary slack

When writing high-impact messages, a _____ is an invaluable tool that you can use to engage your reader's attention whenever you have more than one of anything in your writing.

bulleted list

A-n-Y dominates its market section by offering a wide range of toys that includes soft toys, plastic construction toys, electronic toys, and board games to the public. It is evident that A-n-Y is a _____.

category killer

In the context of legal and ethical dimensions of business conducts, it is illegal but ethical to:

collaborate with other medical clinics to guarantee low prices in low-income counties.

Enterprise resource planning (ERP) systems are:

complex.

Effectiveness means producing products that:

create value

In the context of open market operations, when inflation is a concern, the Fed sells securities to buyers who write checks to the Fed to pay for securities they bought, and the Fed withdraws these funds from banks. With fewer funds, _____.

credit becomes tighter

The tangible and intangible features of a product are sometimes called the _____.

customer benefit package

An assumption of Theory Y is that:

people can accept and even seek responsibility

Macroeconomics involves the study of:

the gross domestic product of a country.

Which of the following is a difference between a C corporation and an S corporation?

A C corporation is double taxed, whereas an S corporation is taxed as a partnership.

_____ is similar to a virus, except that it is an independent program that can spread across computer networks without being attached to other files.

A worm

Which of the following statements is true of ethics?

Actions that are completely legal can still be unethical.

In the context of international trade, which of the following companies is facing the barrier of legal differences?

An Asian company that can only import a limited amount of crude oil from an Arab country because of international trade restrictions

Which of the following countries most likely has a comparative advantage?

An Asian country that produces quality automobiles with little opportunity cost compared to other countries

_____ is a deep-seated sense that forces other than the individual are responsible for what happens in his or her life.

An external locus of control

__________are structured training programs that mandate that each beginner serve as an assistant to a fully trained worker before gaining full credentials to work in the field.

Apprenticeship programs

_____ is a management tool that explicitly shows how a firm will acquire and use the resources needed to achieve its goals over a specific time period.

Budgeting

__________service customers who are too small to merit in-person sales calls from wholesaler reps.

Cash and carry wholesalers

Which of the following are the elements of distribution strategy?

Channels of distribution and physical distribution

__________is a widely accepted social movement that supports a buyer's right to be informed, to be safe, to choose, and to be heard.

Consumerism

_____ refers to planning for unexpected events, usually involving a range of scenarios and assumptions that differ from the assumptions behind the core plans.

Contingency planning

The _____ requires senders of unwanted commercial email to label their messages as ads and to tell the recipient how to decline further messages.

Controlling the Assault of Non-Solicited Pornography and Marketing Act

__________is a form of unemployment that involves layoffs during recessions.

Cyclical

_____ refers to marketing, buying, selling, and servicing of products over a network, usually the Internet.

E-commerce

Which of the following statements is true of human resources departments?

Effective HR people remain open to exceptions even as they enforce broad company policies.

In the context of monitoring ethics and social responsibility, which of the following is the starting point of a social audit?

Establishing goals

_____ means establishing only one retail outlet in a given area.

Exclusive distribution

__________refers to selling products in foreign nations that have been produced or grown domestically.

Exporting

Consumerism is a widely accepted social movement. Which of the following can be considered a consumer's right?

Expressing legitimate complaints easily

The__________established a minimum wage and overtime pay for employees working more than 40 hours a week.

Fair Labor Standards Act of 1938

The _____ required firms with 50 or more employees to provide up to 12 weeks of job-secure, unpaid leave on the birth or adoption of a child or the serious illness of a spouse, child, or parent.

Family and Medical Leave Act of 1993

Which of the following is a difference between managerial accounting and financial accounting?

Financial accounting is governed by a set of generally accepted accounting principles, whereas managerial accounting uses procedures developed internally that are not required to follow generally accepted accounting principles.

_____ remain constant regardless of how many products are sold.

Fixed costs

Which of the following strategies for reaching global markets is a specialized type of licensing?

Foreign franchising

_____ refers to the physical components used to collect, input, store, and process data, and to display and distribute information.

Hardware

Alfred, a human resource manager at an IT firm, reasons, "Although everyone should be given an equal opportunity, but for once it is fine to give my friend the first shot at the opening in my company because I know he really needs the job." In this context, which of the following statements is most likely true of Alfred?

He views ethics as relative

Who among the following individuals uses nonverbal communication?

Herbert, who maintains eye contact with his employees while talking to them

Which of the following is an intimidating obstacle that small businesses face?

High health insurance costs

Which of the following is a drawback of buying a franchise?

If the national brand suffers, so does the business.

Which of the following statements is true of the wage gap between CEO pay and worker pay?

In 2011, CEO pay was correlated to how well companies fared in the stock market.

Which of the following is a difference between limited partnerships and limited liability partnerships?

In limited liability partnerships, all the partners actively participate in the management of the company, whereas in limited partnerships, only the general partners actively manage the company.

Which of the following communication channels should ideally be used when you need to reach a large audience with an important message?

In-person presentation

Which of the following is a negative factor that affects socialist economic systems?

Inefficiencies and corruption

Which of the following is a difference between inflation and deflation?

Inflation is a period of rising average prices across the economy, whereas deflation is a period of falling average prices across the economy.

_____ involves placing a producer's products in as many stores as possible.

Intensive distribution

The basic mission of the _____ is to promote global economic cooperation and stable growth

International Monetary Fund

In the context of the strategies for reaching global markets, which of the following is a key risk of foreign outsourcing?

Involvement of social responsibility

In the context of an organization dedicated to promoting corporate social responsibility, which of the following statements is true of measuring a company's success by evaluating a double bottom line?

It accounts for traditional financial indicators, such as earnings.

Which of the following statements is true of ownership utility?

It adds value by making it easier for customers to possess the goods that they purchase.

Which of the following is true of cloud computing?

It allows lower costs and excess capacity to its users

A benefit that cloud computing provides to individual users is that:

It allows them to store large files without taking up valuable space on their computers' hard drive.

Which of the following is an advantage of a broadband Internet connection?

It allows users to quickly download large files such as music, games, and movies.

In the context of creating and delivering successful verbal presentations, which of the following statements is true of dynamic delivery?

It begins and ends with preparation.

In the context of budget preparation, which of the following is a disadvantage of participatory budgeting?

It can lead to budgetary slack.

Which of the following statements is true of cost-based pricing?

It determines the price by adding a fixed margin to the per-unit cost of a product.

In the context of global trade, which of the following statements is true of balance of payments?

It includes foreign borrowing and lending.

Which of the following statements is true of telecommuting?

It increases annual cost savings for employers

Which of the following statements is true of sexual harassment?

It involves discrimination against a person based on his or her gender.

Which of the following statements is true of equity theory?

It is based on perceptions, which are not always on the mark.

Which of the following statements is true of job enrichment?

It is the creation of jobs with more meaningful content, under the assumption that creative work will motivate employees.

Which of the following statements is true of profit in a business?

It is the financial reward that comes from starting and running a business.

Which of the following statements best defines a channel of distribution?

It is the network of organizations and processes that links producers to consumers.

Which of the following statements is true of a specialty store?

It sells a wide selection of merchandise within a narrow category.

In the context of bringing the code of ethics of a company to life, which of the following statements is true when experts try to advocate a forceful, integrated approach to ethics?

It should be ensured that the company's ethics code is both local and global in scope.

__________is the examination of specific tasks that are assigned to each position, independent of who might be holding the job at any specific time.

Job analysis

Who among the following is most likely to benefit in a case where there is a weak dollar against a euro?

John is an American who exports goods to Europe.

_____ is an approach to manufacturing that emphasizes the elimination of waste in all aspects of manufacturing processes.

Lean production

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

Loss

Which of the following communication channels should ideally be used when you must communicate lengthy or detailed uncontroversial information?

Memos

In the context of budget preparation, which of the following is an advantage of using bottom-up budgeting?

Middle managers are likely to be highly motivated to achieve budgetary goals.

_____ involves hiring independent contractors to sell products to their personal network of friends and colleagues and to recruit new salespeople in return for a percentage of their commissions.

Multilevel marketing

_____ are market structures with one company as the supplier of a product because the nature of that product makes a single supplier more efficient than multiple, competing ones.

Natural monopolies

__________is the profit or loss a firm earns in the time period covered by the income statement.

Net income

__________is a form of communication that does not involve the use words.

Nonverbal communication

__________is the first step in the training and development process, designed to introduce employees to the company culture and provide key administrative information.

Orientation

In the context of employee compensation, which of the following statements is true of the various performance pay options?

Pay for knowledge involves awarding bonuses and pay increases in exchange for increases in knowledge.

__________is a scam in which official-looking emails are sent to individuals in an attempt to get them to divulge private information such as passwords, usernames, and account numbers.

Phishing

In the context of employee selection, which of the following statements is true of employment testing?

Physical exams are highly regulated by state and federal law.

Which of the following factors is most likely to be covered by the social environment dimension of a business?

Population size

Which of the following is a disadvantage of online retailing?

Product delivery takes at least a couple of days.

Which of the following is an internal recruitment method?

Promotions

_____ is a technology that stores information on a microchip and transmits it to a reader when it is within range.

Radio frequency identification

Which of the following is a benefit of holding large inventories?

Reduced ordering costs

Which of the following scenarios exemplifies a nonverbal communication that is most likely to have a negative impact on the outcome of a conversation?

Rudolph fidgets frequently when he delivers a PowerPoint presentation to his sales team.

_____ refer to the pay that employees receive over a fixed period, most often weekly or monthly.

Salaries

The _____ limits conflict-of-interest issues by restricting the consulting services that accounting firms can provide for the companies they audit

Sarbanes-Oxley Act

Which of the following is the last step of a complete human resource (HR) plan?

Separation

In the context of a SWOT (strengths, weaknesses, opportunities, and threats) analysis, which of the following exemplifies an external threat to a company?

Significant changes in the taxation policies implemented by the government

_____ is an approach to quality improvement characterized by very ambitious quality goals, extensive training of employees, and a long-term commitment to working on quality-related issues.

Six Sigma

__________are local offices—affiliated with the U.S Small Business Administration—that provide comprehensive management assistance to current and prospective small business owners.

Small Business Development Centers

_____ includes all organizations, processes, and activities involved in the flow of goods from the raw materials to the final consumer.

Supply chain

Which of the following communication channels should ideally be used when the content is uncontroversial and a quick response regarding relatively simple issues is required?

Texting

A public accounting firm takes up a contract to perform an external audit for an oil manufacturing company. The firm, however, is already in a consulting contract with the oil company. Because of its prior association with the oil company and the hefty fee the oil company pays the firm, the firm manipulates the audit report. Which of the following laws is violated in this scenario?

The Sarbanes-Oxley Act

In the context of the history of American business, which of the following statements is true of the production era?

The assembly line became standard across major manufacturing industries

In the context of the history of American business, which of the following statements is true of the marketing era?

The balance of power shifted away from producers and toward consumers.

__________consists of the sequence of activities in a project that is expected to take the longest to complete.

The critical path

Which of the following is a disadvantage of franchising for a franchisee?

The negative halo effect

__________involves determining how a product will flow through a channel from the producer to the consumer.

The physical distribution strategy

Which of the following statements is true of necessity entrepreneurship in high-income countries?

The rate of necessity entrepreneurship is low.

Which of the following is true of contingency planning?

The senior manager spearheads this process but with input from the other levels of management.

Which of the following dimensions of a business environment embodies the values, attitudes, customs, and beliefs shared by groups of people?

The social environment

Which of the following statements is true of online retailing?

There is a lack of security on the Web

Which of the following statements is true of distributors in a channel of distribution?

They add value in a number of different ways to products.

In the context of strategic planning, which of the following is true of mission statements?

They provide a clear, long-term focus for an organization

Which of the following is a characteristic of entrepreneurs?

They risk their time, money, and other resources to start and manage their business.

In the context of a company's responsibility to the environment, which of the following is the idea behind sustainable development?

To meet the needs of the current generation without harming the ability of future generations to meet their needs

In the context of funding options for small businesses, the__________assists entrepreneurs by partially guaranteeing loans from local commercial lenders.

U.S. Small Business Administration

Which of the following is a difference between total quality management (TQM) and Six Sigma?

Unlike TQM, Six Sigma aims to reduce defects of any process to a level of no more than 3.4 per million opportunities.

Which of the following is a powerful contribution made by small businesses to the U.S. economy?

Vitalizing inner cities

Websites that incorporate interactive and collaborative features to create a richer, more interesting, and more useful experience for their users are known as _____.

Web 2.0 sites

In the context of ethics and social responsibility in the global arena, which of the following statements is true of a business's responsibility to workers abroad?

When deciding living wages, companies must bring together their own values with the laws of both the United States and their host countries.

A _____ is a set of related activities that transform inputs into outputs, thus adding value.

__________refers to moving production or support processes to foreign countries.

In the context of e-commerce, most websites transmit online payment information using _____ to ensure safe transactions.

a secure socket layer protocol

A sole proprietorship is a form of business ownership in which

a single owner actively manages the company.

A__________is a formal document that describes a business concept, outlines core business objectives, and details strategies and timelines for achieving those objectives.

business plan

The various ways in which a message can be sent, ranging from one-on-one in-person meetings to Internet message boards, are called__________

communication channels

A(n)__________is a combination of two firms that are in unrelated industries.

conglomerate merger

Brenda owns a store in a small town. The store sells a small range of everyday and impulse products, such as chocolates, magazines, novelties, and snacks. The store remains open seven days a week from 08:00 a.m. to 12:30 a.m. Brenda's store can be categorized as a(n) _____.

convenience store

The nonprofit, nonpartisan Character Counts organization has worked with various group of educators and community leaders to establish a set of:

core ethical values that transcend political, religious, class, and ethnic divisions.

Costs are deducted from revenue in several stages to show how net income is determined. The first step in this process is to deduct:

costs of goods sold.

The _____ is a project-management tool that illustrates the relationships among all the activities involved in completing a project and identifies the sequence of activities likely to take the longest to complete.

critical path method

During a period of inflation in the United States, the Federal Reserve sells treasury bonds. Buyers of these bonds write checks to the Fed, and the Fed cashes these checks from banks. Given this information, the banks will most likely:

cut back on the loans they make.

In _____, marketers determine prices based on what consumers are willing to pay and then subtract their desired margins to yield target costs.

demand-based pricing

A _____ is a type of franchising arrangement in which the franchisor makes a product and licenses the franchisee to sell it.

distributorship

The primary reason people choose to become entrepreneurs is to:

earn more money.

An advantage of franchising is:

easier access to funding.

A(n) _____ is a structure for allocating limited resources.

economic system

In operations management, _____ means using resources to create value by providing customers with goods and services that offer a better relationship between price and perceived benefits

effectiveness

When properly implemented, intranets enhance communication and collaboration among:

employees.

Odd pricing refers to the practice of:

ending prices in numbers below even dollars and cents

According to small business experts, while raising start-up funds from friends and relatives, it is:

essential to keep the relationship as professional as possible.

Firms create _____ by offering limited access to certain areas of their private network to a selected group of stakeholders.

extranets

In the context of universal ethical standards, being open-minded and not taking advantage of others exemplifies the core value of _____.

fairness

People with an external locus of control:

feel buffeted by forces such as random luck.

To give the company's stockholders, creditors, and other external stakeholders an accurate idea of the company's overall performance, Rowensport Corporation, a multinational company, releases statements that contain details of the company's profits and losses over the past five years. In this scenario, the company is most likely involved in _____.

financial accounting

A _____ is used for goods that must be produced at a specific site or that are so large and bulky that it isn't feasible to move them from station to station.

fixed position layout

When organizations employ different types of departmentalization at different levels of the organization, their approach is called _____.

hybrid departmentalization

A(n) _____ is a form of business ownership that offers both restricted responsibility to its owners and flexible tax treatment.

limited liability company

Technological tools such as the Internet and email have:

made it easy for small business owners to manage their firms on the go.

Merc Enterprise is an independent distributor that distributes coffee machines and water purifiers to firms on a large scale. In addition to taking legal possession of the goods it distributes, the company also provides a complete array of services that includes warehousing, shipping, product repairs, and credit to its business buyers. In this scenario, it can be said that Merc Enterprises is a(n) _____.

merchant wholesaler

TrinkCan is a soda manufacturing company. People can buy the company's soda from grocery stores, restaurants, vending machines, and online. In this scenario, it is evident that TrinkCan has adopted _____.

multichannel retailing

In low-income countries, a high percentage of entrepreneurs are considered__________.

necessity entrepreneurs

In the context of financial statements of a company, cash flow statements commonly begin with _____.

net income

In the context of challenges to effective communication, the term _____ refers to any interference that causes the message you send to be different from the message your audience understands.

noise

In the context of active listening, one of the dos for better listening is the use of _____.

nonverbal communication

In the context of management planning,__________refers to very specific, short-term planning that applies tactical plans to daily, weekly, and monthly functions.

operational planning

A corporation is a separate entity from its owners where the:

owners are not personally responsible for the obligations of the company.

A(n)__________is a voluntary agreement under which two or more people act as co-owners of a business for profit.

partnership

A _____ doesn't require work to be performed in a specific sequence; instead, the product can be moved from one type of machinery to another in whatever sequence is necessary.

process layout

Trade restrictions were created to:

protect national security interests.

A__________is a request for the database management software to search a database for data that match criteria specified by a user.

query

In the context of international trade restrictions, _____ are limitations on the amount of specific products that may be imported from certain countries during a given time period.

quotas

Allied Bakeries sells processed food and beverages manufactured by Winston Corp. to the public. In this scenario, Allied Bakeries is a _____.

retailer

In the context of equal employment opportunities, affirmative action:

seeks to make up for the systematic discrimination of the past by creating more opportunities in the present.

To preserve independence and impartiality, the Financial Accounting Standards Board (FASB) members are required to:

sever all ties with any firms or institutions they served prior to joining the board.

The span of control is also called the _____.

span of management

In the context of social responsibility,__________include employees and investors who have a personal interest in the performance and actions of an organization.

stakeholders

A(n) _____ is a corporation that has limited number of owners that operates under simpler, less formal rules than a C corporation.

statutory close corporation

David is the chief executive officer of Grand Rocks Mining Company. He has convinced the company's board of directors to implement a change in the mining procedure. According to the new procedure suggested by David, less resources will be exhausted. This will ensure that the ability of future generations to meet their needs is not harmed because of shortage of natural resources. By agreeing to David's suggestion, Grand Rocks has embraced the idea of _____.

sustainable development

Merchant wholesalers can develop their own marketing strategies, including pricing strategies, because they

take legal title to the goods they distribute.

In the context of an acquisition, the firm that is purchased by another firm is called the _____.

target firm

In the context of management skills, front-line managers must have a high degree of _____, which help them hire, train, and evaluate employees; avoid mistakes; and ensure high-quality production.

technical skills

In the context of a business environment, computers, telecommunications, and other digital tools are considered to be part of the _____.

technological environment

An advantage of a centralized organization is that it:

tends to have a uniform customer approach across the front lines.

A project-management tool that illustrates the relationships among all the activities involved in completing a project and identifies the sequence of activities likely to take the longest to complete is called _____.

the critical path method

The extent to which decision-making power is held by a small number of people at the top of the organization is known as _____.

the degree of centralization

During a period of grave financial crisis in the United States, Congress is pressurized to raise the limit on the maximum amount of money the government can borrow. Congress increases the limit on the condition that it will implement sharp tax hikes and across-the-board spending cuts to compensate for the raise and to ensure that the overall budget deficit decreases. In this scenario, the measures implemented by Congress will most likely create:

the fiscal cliff.

Buying an established business is a better plan than starting your business from scratch because:

the organizational structure is in place.

In the context of monetary policy, if the Fed decreases the reserve requirement, _____.

there will be more loans available

If an auditor doesn't find any problems with the way a firm's financial statements were prepared and presented, the report will offer a(n) _____ opinion.

unqualified

To strike the right tone while writing a business message, it is suggested that an individual:

uses the active voice to facilitate concise communication.

A large film production company merges with a popular sound processing studio, resulting in the formation of a new company out of the two previously independent firms. This is most likely an example of a _____.

vertical merger