COMM - 1800 Practice Questions

A corporation owned and managed by volunteers supplies books and educational materials to impoverished children in Latin America. Its focus is not on earning a profit but on serving the community. This company is an example of a(n) domestic corporation. nonprofit corporation. sole proprietorship. quasi-public corporation. C corporation.

nonprofit corporation.

What is true of a free-market system? Laissez-faire capitalism is absent. Most businesses are owned and operated by the government. Egalitarianism is the norm. All economic decisions are made without government intervention. Central government planning determines what goods and services satisfy citizens' needs.

All economic decisions are made without government intervention.

Employees expect businesses to move completely to telecommuting. respect their rights as consumers. protect their investments. keep them informed of what is happening in the company. run the company without their input.

keep them informed of what is happening in the company.

David notices that one of his colleagues takes office supplies home with him. In deciding whether or not to report this behavior, what must he do first? confront the colleague about the situation discuss the situation with other colleagues ask his wife what she thinks know his company's policy regarding his colleague's behavior discuss the situation hypothetically with his manager

know his company's policy regarding his colleague's behavior

What is considered to be the biggest advantage to the corporate form of double taxation limited liability employee-owner separation nontransferable ownership

limited liability

Tomas has responsibility for the functions of organizing, staffing, planning, and controlling activities in a large company. These functions are most closely associated with managers. assembly line workers. investment advisors. stockbrokers. direct sales executives.

managers.

Managers are engaged in the Blank______ function of management when they review plans and determine what activities are necessary to implement them; then, divide the work into small units and assign it to specific individuals, groups, or departments. planning controlling organizing directing

organizing

Meister Corporation created its own continuing education program that offers eligible employees full tuition to pursue continuing education related to their roles at the company. It also created a scholarship program to help employees send their children to college. These programs exemplify the company's ethics, principles, and values. financial viability. compliance with legal and regulatory requirements. corporate citizenship. philanthropic activities.

philanthropic activities.

Ross is a software engineer who starts his own website development firm. His friend, Phoebe, is the owner of a store that sells office supplies. Ross designs a new website for Phoebe's store in exchange for the necessary office supplies and equipment he needs for his business. Which source of business funding does this scenario best illustrate? factoring mortgaging bartering equity financing liquidating

bartering

A food processing plant started using a new preservative in its products. However, it didn't include anywhere on its packaging that this preservative could cause an allergic reaction in people who are allergic to milk products. This is a violation of consumers' right to be heard. safety. be informed. choose. be healthy.

be informed.

Which of these is a stage of social responsibility? political ethical mechanical rational philosophical

ethical

Russia was implicated in a doping scandal with its athletes that resulted in a 4-year suspension from the Olympics. This illustrates how there is/are sometimes ________blank in sports as well as business. law breaking management disputes social issues ethical misconduct regulatory breaks

ethical misconduct

Valora is asked to be a part of a new business venture for a revolutionary mechanism to repair Internet cables that are placed on the ocean floor. Since the business involves high risk, Valora does not want to be held completely liable for the firm's debts if the project fails. In this case, Valora is most likely to prefer to participate as a(n) limited partner. general partner. owner of an S corporation. sole proprietor. member of a cooperative.

owner of an S corporation.

A corporation wanting to raise funds would try to find people who are interested in investing with that corporation. This process would be best facilitated by using a(n) securities trader. funds manager. new issue trader. investment banker. accountant.

investment banker.

A partnership established for a specific project or for a limited time is called ______. cooperative limited liability company general partnership joint venture

joint venture

When a partnership is established for a specific project or for a limited time, it is called a(n) cooperative sole proprietorship joint venture acquisition conglomerate

joint venture

Functions of Middle Managers

Most: Organizing Least: Controlling

Select the three items that are usually listed in the articles of partnership. each partner's typical domestic spending management role or duty of each partner the value of each partner's retirement accounts contribution (money or assets) of each partner correct how profits will be distributed

- management role or duty of each partner - contribution (money or assets) of each partner correct - how profits will be distributed

Which statement characterizes a sole proprietorship? Sole proprietorships net far more sales and income than corporations. Sole proprietorships are the least common form of business organization in the United States. A sole proprietorship would most likely focus on services rather than on the manufacture of goods. Sole proprietorships are typically large businesses employing more than 100 people. Most sole proprietorships have limited liability for their debts.

A sole proprietorship would most likely focus on services rather than on the manufacture of goods.

________blank is often called the father of capitalism. Karl Marx George Washington Benjamin Franklin Alexander Hamilton Adam Smith

Adam Smith

Monique and her team have identified a problem, defined it, and developed a variety of options. In the context of the decision-making process, which of the following is the next step that Monique and her team should take? . Implement the decision. Select a random option. Analyzing the options. Monitor the consequences.

Analyzing the options.

What is a characteristic of economic depression? Unemployment levels are low or almost absent.v Consumer spending is high. Individuals' incomes increase at the same pace as rising prices. Buying power of consumers is quadrupled. Business output is sharply reduced.

Business output is sharply reduced.

Priya teaches business studies in a college. As part of the curriculum, she needs to demonstrate to her students the steps involved in starting a business. She plans to introduce the steps in a sequential order, and it includes asking her students to present their views and provide examples with each step. As the first step of the learning activity, what should Patty ask the students to do? Devise a strategy to guide planning and development in a business. Decide the form of ownership each student would select for his or her new business. Come up with some kind of general idea for creating a new business. Assess the financial resources needed to start a new business. Decide whether to acquire an existing business, start a new one, or buy a franchise.

Come up with some kind of general idea for creating a new business.

When employees shifted to working from home during the COVID-19 pandemic, it created a problem for companies with respect to misconduct. What was the problem? Employees didn't have access to human resources to report violations. Employees were exposed to ethical misconduct outside the organization that they wouldn't have otherwise known about. Employees spent more time volunteering and less time working. Employees had more time to watch the media report on ethical misconduct by businesspeople and lost trust in their organization. Companies couldn't monitor employee misconduct.

Companies couldn't monitor employee misconduct.

________blank is defined as the activities that individuals, groups, and organizations undertake to protect their rights as customers. Consumerism Conspicuous consumption Corporate citizenship Protectionism Sustainability

Consumerism

What is true of product availability in a communist system? Consumers have a limited choice of both goods and services. Consumers have a limited choice of goods, but they are inexpensive. Consumers have no choice in the goods and services that are offered. Consumers have a wide choice of services but not goods. Consumers have a wide choice of goods, but they are expensive.

Consumers have a limited choice of both goods and services.

________blank is the extent to which businesses meet the legal, ethical, economic, and voluntary responsibilities placed on them by their various stakeholders. Ethical well-being Social responsibility Virtual sustainability Consumer relations Corporate citizenship

Corporate citizenship

Which statement is true of business ethics? Ethical issues are not limited to for-profit organizations. Business ethics does not extend beyond legal issues. Ethical conduct does not have any impact on business relationships. Ethical conflicts never evolve into legal disputes. Ethical issues are not affected by social perceptions.

Ethical issues are not limited to for-profit organizations.

________blank refers to attaching a positive environmental association on an unsuitable product, service, or practice. Greenwashing Whitewashing Green marketing Astroturfing Conspicuous conservation

Greenwashing

Helene owns a small sporting goods store. In her community, she must compete with stores like Dick's Sporting Goods and Target that supply sporting goods. What is one difference between Helene's small store and these larger stores? Unlike Helene's store, the larger stores are not equipped to focus on mass markets or wide market segments. Decisions can be made and executed more quickly in the larger stores than in Helene's store. Helene's store can develop and introduce a new product in a much shorter time than the larger stores. Helene does not need to multitask, while the owners of the larger stores do. Helene's store requires more money to start and maintain than the larger stores.

Helene's store can develop and introduce a new product in a much shorter time than the larger stores.

What is an advantage that corporations provide as a form of business ownership? Corporations have the most freedom from government regulations. The income earned by corporations is taxed only once. The owners of corporations do not have to share their profits with stockholders. The process involved in forming corporations is very easy and inexpensive. It is easy to transfer ownership in corporations.

It is easy to transfer ownership in corporations.

What is a reason why a code of ethics is important? It alerts employees about important issues and risks to address. It provides an individual approach to dealing with ethical decisions. It serves as an internal document, which is not shared with the public, suppliers, or regulatory authorities. It negates the need to have systems for reporting or places to go for advice when facing an ethical issue. It negates the need to evaluate and improve ethical decision making.

It alerts employees about important issues and risks to address.

Which statement is true about GDP as a measure of a country's economic health? It does not include the services produced in a country. It measures only those goods and services made within a country. It includes profits from companies' overseas operations. It does not include profits earned by foreign companies within the country being measured. It essentially takes into account the concept of GDP in relation to population.

It measures only those goods and services made within a country.

______ can be defined as a process designed to achieve an organization's objectives by using its resources effectively and efficiently in a changing environment. Management Staffing Direction Financing

Management

Which statement regarding the levels of management in an organization is true? Lower-level managers spend most of their time planning within an organization. Middle managers' responsibility is more narrowly focused than that of high-level managers. Most people get their first managerial experience as high-level managers of a company. Front-line managers take care of the overall strategic direction of a company and play a key role in representing the company to stakeholders. Foreman, supervisor, and office service manager are some of the common titles for high-level managers within an organization.

Middle managers' responsibility is more narrowly focused than that of high-level managers.

Functions of Front-Line Managers

Most: Controlling and Directing Least: Planning

Functions of High Level Managers

Most: Planning Least: Controlling

Which organization funds programs to train the hard-core unemployed so that they can find jobs and support themselves? Transparency International Boston Consulting Group National Alliance of Businessmen National Business Ethics Organization British Financial Services

National Alliance of Businessmen

Delegation of Authority

Not only giving tasks to employees but also empowering them to make commitments, use resources, and take whatever actions are necessary to carry out those tasks.

What is true of an open economy, like that of the United States? Open economies tend to grow very slowly. Open economies do not engage in international trade. Open economies tend to lack efficiency and productivity. Open economies are major players in international trade. Open economies lack access to technology.

Open economies are major players in international trade.

________blank indicates the income level of "average" Americans. It is useful in determining how much "average" consumers spend and how much money Americans are earning. Per capita income GDP Budget deficit Consumer price index Worker productivity

Per capita income

A ________ corporation is owned by just one or a few people who are closely involved in managing the business.

Private

As an entity, cooperatives are not set up to make ______

Profit

A small plumbing company decides to incorporate. It wants to have greater flexibility than traditional corporations. What type of corporation would work best for this company? domestic corporation foreign corporation alien corporation S corporation C corporation

S corporation

A national provider of natural gas is a partnership that is traded on securities exchanges. This allows it to have the tax benefits of a limited partnership but the liquidity of a corporation. This company is an example of a(n) master limited partnership. joint venture. S corporation. general partnership. C corporation.

S corporation.

Which two statements are true about the role of small business in the U.S. economy? Approximately 50 percent of all U.S. firms are small businesses. Small businesses employ nearly half of all private workers. Small firms represent approximately 25 percent of exported goods from the United States. More than 99 percent of U.S. firms are classified as small businesses.

Small businesses employ nearly half of all private workers. More than 99 percent of U.S. firms are classified as small businesses.

Match these following 4 terms Sole Proprietorship Partnership Corporation S-Corp Taxed as partnerships Individual income is taxes The business and shareholders are taxed Individual owners' income is taxed

Sole Proprietorship - Individual income is taxes Partnership - Individual owners' income is taxed Corporation - The business and shareholders are taxed S-Corp - Taxed as partnerships

_________can be considered as both an advantage and a disadvantage of a sole proprietorship. Taxation Secrecy Transparency Continuity Liability

Taxation

Which scenario best exemplifies a company with a strong ethical culture? Since the top management at Claire's company feels they only hire ethical employees, they do not see the need for a formal, written ethics policy. Cho follows the lead of her immediate supervisor; if he bends the rules, she feels that she can do the same. The middle-level managers at Betsy's company do not get direction from top management regarding ethical behavior, but they all try to do what is right. Ben reports to two different supervisors—one who follows the company's ethics policy and one who makes exceptions to the rules. Ben is not sure who to follow. The top management at Dorthea's company clearly communicates to all employees the ethical behavior expected of them.

The top management at Dorthea's company clearly communicates to all employees the ethical behavior expected of them.

How are the members of a board of directors selected? They are appointed by the top management of the corporation. incorrect They are appointed by the shareholders with the most shares of stock. They are elected by non-stock-holding employees. They are elected by the stockholders of the corporation.

They are elected by the stockholders of the corporation.

Korane just took a job as a financial advisor with a large firm. He wants to make sure that all of his business dealings are ethical. What will guide him on any gray or ambiguous area he may face at his new job? a detailed mission statement a sustainability statement a code of ethics a code of liability a personal moral statement

a code of ethics

According to the Global Business Ethics Survey (NBES), ________blank is the greatest determinant of future misconduct. the external environment a company's workforce a company's stakeholders a company's ethical culture the universal business overview

a company's ethical culture

________blank is the act of an employee exposing an employer's wrongdoing to outsiders. Fraud Whistleblowing Corporate citizenship Arbitration Gatekeeping

Whistleblowing

Which form of business ownership provides limited liability but is taxed like a partnership? a limited liability company a C corporation a general partnership a cooperative a sole proprietorship

a limited liability company

Which form of business ownership is directly linked to the life of its owner and their ability to work? a C corporation a franchise an S corporation a sole proprietorship a cooperative

a sole proprietorship

What is a proxy? an advisory position to a corporation's board of directors. the selling of a corporation's stock on the public market for the first time the right of a stockholder to purchase new shares of stock before anyone else another name for an outside director of a corporation a written authorization assigning voting privileges to someone else

a written authorization assigning voting privileges to someone else

When a company issues a poison pill to try to head off a hostile takeover attempt, the company will fire its board of directors for incompetence. require a majority of stockholders to approve the takeover. allow stockholders to buy shares of stock at prices lower than the market value. file a lawsuit to avoid the takeover. fire the entire executive committee.

allow stockholders to buy shares of stock at prices lower than the market value

A would-be entrepreneur might choose retailing, services, and high technology industries to start their businesses because these fields ______. are typically underrepresented have smaller target markets are relatively easy to enter are highly competitive

are relatively easy to enter

Delegation of ____ means not only giving tasks to employees but also empowering them to make commitments, use resources, and take whatever actions are necessary to carry out those tasks.

authority

Jethro is a very efficient and driven manager who makes all the decisions himself. He comes across as a very assertive person who often directs his employees on what needs to be done. To motivate his employees, he mostly uses monetary bonuses as rewards. In this scenario, Jethro can be regarded as a(n) ________blank leader. democratic participative disengaged autocratic free-rein

autocratic

Rafe owns a company that makes metal and wooden signs. In order to acquire the different kinds of wood and steel he needs to make his product, and the people to do the work, Rafe needs natural resources. labor. capital. factors of production. economics.

capital.

Dante works at a manufacturing plant. He has been asked by the upper management to be part of a formal, permanent group that will specifically work with union laborers to address all concerns and draft company policy regarding union benefits. Dante has been asked to be part of a ______. . project team division committee task force

committee

The European Commission investigated Google to determine whether it promoted its own search results over those of other search engines in spite of their relevance. The aspect of fairness at issue here is conflict of interest. communications. competition. dishonesty. disclosure of potential harm.

competition.

Lana manages a large beauty supply store. Since there are several other beauty supply stores in her area, she consistently analyzes her sales data to make sure she has the most popular items in stock at all times. Her goal is to increase the percentage of sales and market share. This scenario best describes an objective related to growth. competitive advantage. profit. sales .efficiency.

competitive advantage.

Business ethics, social responsibility, and laws together act as a ________blank system, requiring that businesses and employees act responsibly in society. business compliance regulatory social consumer

compliance

Lilly, a manager, makes decisions that benefit her financially at the expense of her firm. This is an example of which ethical issue in business? bullying misuse of company time conflict of interest intimidating behavior bribery

conflict of interest

In response to a recent outbreak of computer viruses, a large technology company, installs computer virus protection software and firewalls in all its employees' computers. This is a form of ________blank planning. strategic static contingency tactical executive

contingency

The process of evaluating and correcting activities to keep the organization on course is known as ______. organizing planning controlling directing

controlling

Before the owners of a corporation can establish the company's bylaws and elect a board of directors, they must receive a ______ from the state in which they are doing business. corporate charter dividend initial public offering partnership

corporate charter

In practice, what is a common characteristic of communist economies? critical shortages of consumer goods high standards of living low prices excessive freedom absence of corruption

critical shortages of consumer goods

If Pete was tasked with developing an organizational structure for his company, he would: create a job description for each person in the firm. outline the company's shared values, beliefs, traditions, and ways of doing things. define the various positions in the company and their relationship to one another. delineate the steps necessary to manufacture the company's product.

define the various positions in the company and their relationship to one another.

A front-line manager at a day spa interacts daily with their employees who run the front desk; perform massages, skin treatments, manicures and pedicures, facials, and waxing services; and keep the spa clean and stocked with snacks and beverages. This front-line manager spends most of time implementing the general guidelines established by high-level management. making strategic decisions. directing and controlling. creating tactical and operational plans. planning and organizing.

directing and controlling.

Which functions are most typical of a wholesaler? distributing manufacturing promoting planning and negotiating for supplies selling to end consumers

distributing promoting planning and negotiating for supplies

General Electric and its employees hold fundraising events for the United Way organization. This illustrates how a business can use ________blank to improve community relations. establishing codes of ethics submission of environmental reports obeying the law recycling donations to charitable organizations

donations to charitable organizations

Joy See, a manager at Power Systems, is known for her passionate and people-friendly ways. Joy See knows all her employees well and trusts them to do the right thing for the company. Any new project starts with an initial briefing from her, after which the teams are given complete freedom to determine the tasks and timeline for that project. From time to time, Joy See gives the teams feedback about the progress of their projects. In this scenario, Joy See can be regarded as a(n) _________blank leader. authoritarian autocratic free-rein bureaucratic disengaged

free-rein

Which of the following is a disadvantage of the partnership form of business? equal division of profits vast amount of regulatory controls friction between general and limited partners perpetual life of the partnership

friction between general and limited partners

This word is defined as two or more individuals who communicate with one another, share a common identity, and have a common goal. matrix task force group committee

group

The fact that environmental responsibility requires trade-offs means that it instigates trade relations. facilitates international competition. helps in generating profits. imposes costs on both business and the public. promotes the practice of fair trade.

imposes costs on both business and the public.

The ________blank specifies all of the terms of the agreement between the bondholders and the issuing organization. trade coupon capital budget lockbox annual report indenture

indenture

The period following the American Industrial Revolution was known for an increasing emphasis on information. agriculture. artisanship. manufacturing. services.

manufacturing.

Tyler owns a local farm stand. Although he sells fruit and vegetables, like the grocery store chains in the area, he has some power over the price he charges because he can offer consumers features they want. For instance, his fruit and vegetables are organic and locally grown. This is an example of monopolistic competition. pure competition. oligopoly. monopoly. competition.

monopolistic competition.

Kenneth starts a consulting firm with his friend Amie. They decide to equally share the profits and have unlimited liability for the debts of their business. Such unlimited liability can be a distinct disadvantage for Kenneth if he has more financial resources than Amie. the status of a limited partner. the exact same financial resources as Amie. comparable financial resources to Amie. fewer financial resources than Amie.

more financial resources than Amie.

Codes of ethics, policies on ethics, and ethics training programs advance ethical behavior because they do not limit the opportunity for misconduct. result in expensive litigation. infringe on consumers' rights to be informed. prescribe which activities are acceptable and which are not. are strictly voluntary in nature.

prescribe which activities are acceptable and which are not.

Decisions regarding product adoption, development, branding, and positioning fall under which element of the marketing mix? price product place distribution promotion

product

The form of business ownership that has the ability to raise capital most easily is a private corporation. public corporation. joint venture. limited partnership. sole proprietorship.

public corporation.

According to the Global Business Ethics Survey, employees in organizations that have written codes of conduct and ethics training, ethics offices or hotlines, and systems for reporting are more likely to find clever ways to hide their misconduct. assume that no misconduct exists in their organizations report misconduct when they observe it. deal with misconduct on their own. ignore misconduct when they see it.

report misconduct when they observe it.

A corporate raider is trying to take over the Cascade Company. In an attempt to avoid this hostile takeover, the Cascade Company is requiring a large majority of stockholders to approve the takeover. Which method of evading a takeover attempt does this describe? a compliance buyout a tender offer a poison pill a class action shark repellant

shark repellant

Individuals who operate by the same principles as other entrepreneurs but view their organizations as vehicles to create social change are referred to as intrapreneurs. change agents. nonprofit entrepreneurs. microentrepreneurs. social entrepreneurs.

social entrepreneurs.

A local landscaping company donates and plants a tree in the community for every new client that uses its landscaping design services. This exhibits the company's business ethics. profitability. business responsibility. irresponsibility. social responsibility.

social responsibility.

Mulan lives in a country where income and social services are distributed equally among its citizens. However, the citizens must pay high taxes and the country often experiences high levels of unemployment. Mulan most likely lives in a(n) ________blank nation. communist socialist capitalist supply and demand free-enterprise

socialist

D'Anada is opening her own formal wear shop. She decides to hire two salespeople to work in the store, one person to order the merchandise, and one person to organize the stock room and help her with the inventory. Hiring these people is known as networking. directing. staffing. downsizing. planning.

staffing.

Extreme Motors is working to find a way to produce the SUVs and trucks its customers want while meeting environmental requirements and making a profit. This is an effort to please multiple shareholders. businesses. clients. stakeholders. priorities.

stakeholders.

A company committed to corporate citizenship might be engaged in the expansion of the company's social media presence. dumping hazardous waste on land rather than in waterways. sustainable manufacturing processes. the development of a new website. fundraising for a political candidate.

sustainable manufacturing processes.

An entrepreneur has been primarily associated with the willingness to take risks. be conservative. work under authority. possess a government job. change employers frequently.

take risks.

A difference between the NASDAQ market and the New York Stock Exchange (NYSE) is that is now classified as an over-the-counter market, while the NYSE is classified as an exchange by the SEC. is a not-for-profit organization, while the NYSE is a for-profit organization. the NYSE used to be primarily a floor-traded market but the NASDAQ was not. the NASDAQ is a publicly traded company, while the NYSE is not. the NASDAQ had merged with electronic exchanges in the past, but the NYSE had not.

the NYSE used to be primarily a floor-traded market but the NASDAQ was not.

Vance's boss often goes on Facebook at work. As a result, the rest of his team goes on Facebook as well. This is an example of which factor of influence regarding ethical behavior? individual moral standards opportunity for misconduct the influence of co-workers the influence of managers personal ethic.

the influence of managers

Ju Long's office is bigger than he currently needs, so he decides to rent out the extra space. He does not want a long-term tenant, as he hopes that his business will grow and he will soon need the space. Thus, he posts the office space for rent on a site that allows people to rent by the week or month. This is an example of direct selling. wholesaling. the sharing economy. intrapreneurship. direct marketing.

the sharing economy.

A characteristic of S corporations is they do not have any restrictions on the number of shareholders. their shareholders have unlimited liability. their shareholders can shift income and appreciation to others. they are very easy to form and operate. they are taxed twice.

their shareholders can shift income and appreciation to others.

Subs and More merges with its supplier, Top Shelf Ingredients, in an effort to have a constant supply of sauce for its sub sandwiches. This is an example of a vertical merger. conglomerate merger. horizontal merger. shark repellant. white knight.

vertical merger.

Being a "good corporate citizen" is an example of the ________blank dimension of social responsibility. puritanical economic legal ethical voluntary

voluntary