Intro to Business Chapters 1-8, 10, 11, 13, 16, and 17 Final Exam

accountants record, classify, and _________________ the results of the financial information they gather

interpret

____________ emphasizes motivating the worker through the characteristics of the job itself

job enrichment

line organizations clearly define the lines of authority and responsibility

true

Empowerment works only when employees are given the proper training and resources to respond.

true

Entrepreneurship involves accepting the risk of starting and running a business

true

the key financial statements are the balance sheet, the income statement, and the statement of cash flows

true

the marketing process includes decisions about the best way to get the product to the consumer

true

the primary reason that companies do performance appraisals is to improve worker performance

true

three elements were basic to Taylor's approach: time, methods, and rules of work

true

today, most companies doing business globally believe it is important for their employees to have experience working in other countries

true

trust between workers and managers must be based on a foundation of fairness, honesty, openness, and moral integrity

true

u.s. business success is largely due to an economic and social climate that allows businesses to operate freely

true

when developing the promotional campaign for a new product, the first step for a firm is to identify their target market

true

Few people today start their own business.

false

small business create about __________ percent of the new jobs in the United States

65

which statement is most consistent with today's views on effective marketing?

"Learn about your customers and exceed their expectations"

List four (4) functions of management

1. planning 2. leading 3. organizing 4. controlling

the "marketing mix" involves four factors in the marketing process. list the four (4) factors of the "marketing mix," also referred to as the four "P's" of marketing

1. product 2. price 3. place 4. promotion

under free-market capitalism, people have four (4) basic rights

1. right to own private property/land 2. right to own a business and keep profits 3. freedom of competition 4. freedom of choice or the right to make own decisions

list the three (3) "basic forms" of business ownership

1. sole proprietorship 2. partnership 3. corporation

The two major types of e-commerce are

B2B and B2C

the legislation the prohibits U.S. businesses from making "questionable" or "dubious" payments to foreign officials to secure business contracts is the

Foreign Corrupt Practices Act

which statement about the B2B market is true

Industrial buyers are usually large.

what is an advantage of hiring contingent workers

It is good strategy if the economic climate is uncertain.

the U.S. economic system relies on

Key economic indicators such as GDP, to measure economic progress.

____________ believed than managers were trustworthy and companies would do well if employees simply did what they were told

Max Weber

management by objectives was developed by

Peter Drucker

a firm's marketing mix consists of four major components, which are generally referred to as the four

Ps

a(n) ___________ analysis is used to help companies evaluate their internal strengths and weaknesses, and develop an awareness of external threats and opportunities

SWOT

___________ exists when the entire supply of a good is controlled by a single buyer

a monopoly

the fee paid to a firm in a licensing agreement that gives another firm the right to manufacture their product or use its trademark is called

a royalty

According to goal-setting theory, in order for goals to enhance motivation and performance they must be

accompanied by feedback

an important difference between accounting and other business functions, such as marketing and management, is that

accounting offers us insight into whether the business is financially sound

the sixth and final step in the accounting cycle involves

analyzing major accounting statements to evaluate the financial condition of the firm

all else being equal, socially responsible firms

are viewed more favorably by consumers

in order for standards to be useful in the controlling process, they must have certain characteristics. one of these characteristics is that they must be

attainable

_______________ is the characteristic of work concerned with the degree of freedom, independence, and discretion an employee has in scheduling work and determining procedures

autonomy

Herzberg found that the factors associated with job environment ranked the highest as employee motivators

false

a ____________ is a check of potential employee's work record, academic record, credit history, and recommendations

background investigation

the three important financial statements prepared by accountants are

balance sheet, income statement, and statement of cash flows

the process of rating an organization's practices, processes, and products against the best of the world is known as

benchmarking

a comparison of bookkeeping and accounting indicates that

bookkeeping involves recording financial information, while accounting is concerned with classifying, summarizing, and interpreting this information

A review of small business successes and failures indicates that the:

businesses with the potential for high profit levels tend to be difficult to start and hard to keep going

accounting transactions are important to a firm's operations. what activities would affect the firm's account balances?

buying and selling goods and services

Creating intense competition between employees within the corporation

can encourage employees to deceive customers

the most liquid asset is

cash

an ethical dilemma refers to a situation where you must

choose between equally unsatisfactory alternatives

even across generations, employee motivation is likely to

come from the job itself

a key to effective leadership is the ability to

communicate a vision and rally others around that vision.

war and terrorism in many parts of the world often lead to

consumer and economic hardship due to increased military spending

the two major types of markets are

consumer market and the B2B market

the ___________ is a statistic used to measure the pace of inflation or deflaction

consumer price index

________ is the term used to describe those functions that a firm can do as well or better than others. it performs these functions in-house, rather than outsourcing

core competencies

the form of business ownership best suited to raising large amounts of money for expansion is the

corporation

double taxation means

corporations pay taxes on their profits. if they distribute after-tax profits to the stockholders, the stockholders also pay taxes on the distribution

Entrepreneurs seeking financial support from bankers and potential investors should

create a detailed business plan to help the bankers and investors understand why this business will succeed

the informal organization of a business is probably best suited to

create a feeling of camaraderie among employees and encourage teamwork

the first step toward establishing open communication within an organization is to

create an organizational culture that rewards listening

which term describes the set of values, beliefs, rules, language, and institutions held by a specific group of people?

culture

firms that have adopted ___________ seek to do more than simply sell a product; they seek to learn as much as possible about their customers in order to satisfy them with goods and services over time

customer relationship management

In today's competitive environment, successful businesses are keenly focused on their

customers

one way to lessen the U.S. government budget deficit is to

cut spending

the statistical study of human population to learn its size, density, and characteristics is called

demographics

____________ is the systematic write-off of the value of tangible asset over its useful life

depreciation

a very critical last step in the process of establishing an ethics code is

enforcement

the last step of the human resource planning system is to

establish a strategic plan for recruiting, selecting, training, appraising, compensating, and scheduling the labor force

what represents the value of one nation's currency relative to the currencies of another country?

exchange rate

in recent years, most countries with communist economic and political systems have

experienced economic depression

rewards in recognition of good work that come from someone else are ____________ rewards

extrinsic

Accountants do the work involved in recording financial events and transactions, but the actual classifying and interpreting of this data is left to financial managers.

false

Although managers who work for large firms must know something about accounting, people who run small businesses only need to know the basics of bookkeeping.

false

Since motivation comes from within an individual, there is little that managers can do to help motivate employees.

false

The tremendous demand for consumer goods and services after World War II helped launch the production era of marketing.

false

a bookkeeper's first task is to record the firm's transactions in a journal

false

a chain of command is a line of authority that moves from the lowest level of the hierarchy to the top

false

a major advantage of sole proprietorships is that an owner has limited liability for the debts of his or her business

false

a major problem with the MBO approach is that it provides no way for employees to provide input into the goal-setting process

false

absolute advantage is the basis for most global trade today

false

bureaucratic organizations are structured to empower employees and please customer

false

double-entry bookkeeping requires that every transaction be approved by two different people before it can be recorded

false

in a high-context culture, group trust is not required in order to accomplish a task

false

in capitalist countries, the government decides what to produce and how the goods and services will be produced

false

laws that protect us from fraud, theft, and violence determine ethical behavior

false

marketing research usually begins with secondary data because it is more accurate and more relevant than primary data

false

microeconomics is the economic perspective that looks at the operation of a nation's economy as a whole

false

most entrepreneurs prefer working for someone else

false

objectives should be expressed as broad, general principles rather than as specific short-term results

false

online businesses avoid the risk of failure by traditional start-up businesses

false

revenue is the amount a business earns above and beyond what it spends for expenses and cost

false

stockholders in a corporation accept unlimited liability for the corporation's debts

false

successful entrepreneurs are exclusively motivated by the desire to become rich

false

the first step in creating a promotional campaign is to define the objectives for each element of the marketing mix

false

the main job of modern managers is to watch over people to be sure they do what the manager asks of them

false

under capitalism, the government prohibits people and business from competing with each other

false

union rules and company policies make the recruitment process easier because they provide guidelines

false

One of the hurdles small businesses face when deciding to export is

financing is often difficult to find

By comparing the types of skills used by managers at different levels within an organization, which of the following is true?

first-line managers use mainly technical and human relations skills, while top managers devote most of their time to activities involving human relations and conceptual skills

the final step of the selling process involves

follow-up

a(n) ____________ is an arrangement whereby someone with a proven idea for a business sells the rights to use the business model, to sell a product or service to others in a given territory

franchise agreement

a person who buys the rights to use a business name and sell a product within a given territory is called

franchisee

What is the benefit of owning your own business?

freedom to keep the profits from your business

After personal savings, the next largest source of capital for entrepreneurs is from:

friends and family

B2B markets tend to be

geographically concentrated

empowerment means

giving employees the authority to make decisions

____________ are broad, long-term accomplishments an organization wants to achieve

goals

the _______ is the nerve center of the informal organization

grapevine

revenue, MINUS cost of goods sold equals

gross profit

the most important technological change likely to affect the marketing success of many firms is the

growth of consumer databases, blogs, and social networking sites

one difference between partnerships and sole proprietorships is that partnerships

have a greater chance of long-term survival due to the accountability of each partner to the other

which statement about home-based work is most accurate

home-based work allows workers to choose their own hours and interrupt work for childcare and other tasks, but this freedom and flexibility can create problems for some workers

which question can help us avoid a decision that would injure our self-esteem?

how will it make me feel about myself?

leadership, coaching, and morale building are all part of a manager's _________ skills

human relations

____________ is illegally obtaining and illegally using private information about a person, such as using someone's credit card number

identity theft

briefly define the terms "exporting" and "importing"

importing: buying products from another country exporting: selling products to another country

Employers provide tools and technology for their employees in order to

improve their efficiency and productivity

Employees observe behavior, which helps instill standards of right and wrong.

true

________ refers to a general rise in the price level of goods and services over time

inflation

one advantage of free trade is

innovation for new products occurs which keeps firms competitively challenged.

the Small Business Administration's microloan program awards loans to entrepreneurs based primarily on their

integrity

insider trading involves

investors using private company information to further their own fortunes.

for a firm to be considered a multinational corporation, which condition must be true

it must have manufacturing facilities and a physical presence in several countries

a ___________ is a partnership in which two or more companies (often from different countries) join together and share the risk and costs in order to undertake a major project

joint venture

the accounting book or computer program where each day's transactions are first recorded is called a

journal

Laws represent the standards of ________ behavior.

legal

pre-employment physical examinations are

legal in some states, but only if given to everyone applying for the position.

when companies owe money to creditors, suppliers, and others, these outstanding amounts are recorded on the balance sheet as

liabilities

____________ are responsible for directly achieving organizational goals

line personnel

a ______ refers to people with unsatisfied wants and needs who are willing and able to buy a product or service

market

a __________ is two firms combining to form one company

merger

today, the economic systems of most nations could most accurately be classified as

mixed economies

free trade between nations generally results in

mutually beneficial exchange relationships.

what is a marketing strategy in which the focus is on small but profitable market segments

niche marketing

business incubators are usually government-funded facilities intended to

offer start-up firms low-cost office space and basic business services

a(n) ____________ would be used by a department manager as a tool for making daily and weekly assignments

operational plan

a(n) __________________ is a visual device that shows relationships among people and divides the organization's work

organization chart

the widely shared values within an organization that provide unity and cooperation to achieve common goals are together known as the

organizational culture

Managers who listen to their subordinates and allow them to participate in decision making are using the ____________ style of leadership.

participative

a typical demand curve shows that

people tend to buy more of a good when its price decreases

_________________ refers to the face-to-face presentation and promotion of goods and services. this also includes searching for prospects and providing follow-up services

personal selling

the management function concerned with anticipating future trends and determining the best strategies to achieve an organization's goals and objectives is known as

planning

Two key management functions that need particular attention when starting a business are

planning and marketing

if global trade experts predict that the value of the dollar will soon fall, it will result in

prices of imported goods rising, but prices of U.S. goods sold overseas falling

the selection process may include a(n) ____________, where employment is only guaranteed for a specified period of time, until either a permanent offer is extended or the employee is discharged

probationary period

in the past, _____________ was important advertising strategy used in movies. now it is also used with video games. it can be easily altered to reflect another advertiser, depending upon which advertiser has purchased ad time.

product placement

__________ refers to the amount of output generated with a given amount of input, e.g the number of pizzas produced per worker per hour.

productivity

one aspect of Title VII of the Civil Rights Act of 1964 is that it

prohibits discrimination based on race, religion, sex, creed, or national origin in matters such as hiring, firing, training, and compensation

the combination of advertising, personal selling, public relations, and sales promotion activities traditionally used by an organization represents its

promotion mix

a ___________ tariff is designed to raise the price of imported products so that domestic goods are more competitively priced

protective

In today's competitive environment, good value means

providing quality products and services at competitive prices

the goal of _______________ is to keep individual customers over time by offering them new products that exactly meet their requirements

relationship marketing

a command economic system is characterized by

reliance on the government to determine what is produced and who gets the output.

one disadvantage of a limited liability company is that it

requires members' approval to transfer ownership

what is an advantage of a line organization in a large business

responsibility and authority are clearly defined

____________ is the monetary value that is received for goods sold, services rendered, and money received from other sources

revenue

a __________ is the share of profits or percentage of sales a franchisee pays to a franchisor

royalty

a meaningful mission statement should address topics such as the organization's

self-concept and company philosophy

the _______________ is usually the easiest form of business to start and end

sole proprietorship

the optimum number of subordinates a manager can supervise is referred to as the

span of control

__________ involves recruiting, hiring, motivating, and retaining the best people available to accomplish the company's objectives

staffing

An owner of a corporation is known as a(n):

stockholder

What entity elects the board of directors for a corporation?

stockholders

consumer decisions regarding the products they buy are often influenced by their nationality, religion, or ethnic origin. marketers realize that the consumer decision-making process is impacted by the consumers'

subcultures

the level of management the is directly responsible for assigning specific jobs to workers and evaluating their daily performance is called

supervisory management

the Small Business Administration sponsors volunteers from industry, trade associations, and education who offer advice to small business owners. these volunteers are called

the Service Corps of Retired Executives (SCORE)

the effectiveness of direct mail advertising suffers from

the consumer perception that it is junk mail

all organizations have two organizational systems, which are

the formal organization and the informal organization

a job analysis results in two written statements. they are

the job description and the job specification

which factor helps determine a manager's span of control

the level of standardization of the work to be done

what is the main difference between matrix-style organization model and cross-functional team

the matrix model is a temporary arrangement, whereas the cross-functional team is a more long-term arrangement

Any debts or damages incurred by a firm organized as a sole proprietorship are:

the responsibility of the owner

When creating a job description, the HR manager may include

the specific responsibilities of the job

One way to get into business is to buy an existing company. The value of the business used to determine a fair purchase price is based on:

the value of what the business owns, what it earns, and what makes it unique

Employees will perceive that their opinions are more valued if

they're provided settings where employees have the opportunity to converse with all levels of management

evidence indicates that the BEST promotional strategy for firms operating globally is

to uniquely design a strategy for each country

since 1975, the United States has had a(n)

trade deficit

A recent business trend is the elimination of layers of management, creating flatter organizations and subsequently, a wider span of control.

true

Abraham Maslow believed that motivation arises from the desire to satisfy unmet needs

true

As one of the tools included in a firm's promotion mix, public relations is intended to earn public understanding and acceptance.

true

Businesses provide goods, jobs, and services to others

true

Managers in progressive organizations tend to emphasize teamwork and cooperation rather than discipline and giving orders.

true

Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.

true

Recent accounting scandals raised serious questions about the legitimacy of an accounting firm performing both auditing and consulting work for the same company.

true

Today's progressive organizations are designed around the needs of the customer. The idea is to organize systems to be responsive to customer needs.

true

a CEO is often the president of the firm and is responsible for developing the strategic plans

true

a code of ethics designed to avoid criminal misconduct is an example of a compliance-based ethics code

true

a firm's financial statements represent a health report regarding the condition of the firm

true

a joint venture is a partnership in which two or more companies join to undertake a major project. all parties commit financing and risk to the project

true

a key element of Frederick Taylor's approach was the time-motion study, which examined the tasks performed to complete a job and the time needed to complete each task

true

according to McGregor, Theory X managers assume that employees dislike work, and will avoid it if possible

true

an advantage of hiring from within is that it improves employee morale

true

at the equilibrium price, the quantity consumers desire to buy equals the quantity sellers are supplying

true

bartering is the exchange of goods and services for other goods or services without the exchange of money

true

compared to sole proprietorship, an advantage of partnerships is their ability to obtain more financial resources

true

corporations represent 20% of all the businesses in the United States and earn over 80% of the total U.S. business receipts

true

customers learn to trust companies that consistently demonstrate good behavior. those same companies can lose this position with one socially irresponsible activity

true

division of labor refers to deciding how many jobs must accomplished and then dividing them up amongst the labor force

true

employee training focuses on short-term skills, while employee development focuses on long-term abilities

true

ethical behavior requires more than following the law

true

human resource management is the process of deciding the number and types of employees your business needs, and then recruiting, selecting, developing, motivating, evaluating, compensating, and scheduling employees to achieve organizational goals

true

if you are trying to prevent failure, it is a good idea to go into the business with good record-keeping techniques

true

in a general partnership, all partners share in management of the business and in the liability for the firm's debts

true

in the past, foreign companies have adapted to U.S. culture more easily than U.S. firms have adapted to foreign cultures

true

international trade is NOT limited to multinational corporations. small businesses do about one-third of all exporting out of the United States

true

one challenged faced by today's human resource managers is that workers overseas often work for lower wages and are subject to fewer laws and regulations

true

organizing the structure of the company means deciding what jobs need to be done and who is responsible for doing them

true

potential entrepreneurs would be well advised to surround themselves with people who are smarter than they are

true

stakeholders are all people who stand to gain or lose by the policies and activities of a business

true

starting a business is a riskier path toward business than working your way up the ranks of a large business

true

surveys show that a majority of millennials are willing to agree to lower salaries if they know their employer is participating in socially responsible activities

true

the "invisible hand" in adam smith's theory turns self-directed gain into social and economic benefits for all

true

the B2B selling process may take a long time before a deal is finalized; therefore, gathering information about the customer before you approach them is critical

true

the Federal Reserve Bank is responsible for controlling the money supply

true

the SBA may guarantee loans made by a financial institution and repay them if the borrowers stop making payments

true

the SWOT analysis helps firms identify competitive threats and market opportunities

true

the United States' highest trade deficit is with China

true

the accounting book that provides all the information about a single account in one place is called the ledger

true

the amount of profit or loss earned by a business can be found by subtracting the firms expenses from its revenues

true

the business environment refers to the surrounding factors that either help or hinder the development of businesses

true

the greed of some businesspeople represents a danger to the operation of a free market system

true

the idea behind customer relationship management is to enhance customer satisfaction and stimulate long-term customer loyalty

true

Herzberg found that an employee's salary

was a hygiene factor rather than a motivator

When we compare the factors of production in wealthy versus poor nations, we find?

wealthy nations have knowledge and entrepreneurial opportunities, while poor nations are often lacking in these areas.

unlimited liability means

when you own your own business, you are responsible for all the business debts