Business Management Midterm
What are the 4 economic activities?
1. Consumption 2. Production 3. Exchange 4. Distribution
What are communication barriers?
1. Language 2. Environment 3. Bad Timing 4. Information Overload
What are the 3 basic economic questions?
1. What will be produced? 2. How will it be produced? 3. How will the products be allocated?
What condition must a channel be in for it to be effective?
A channel needs to be properly managed
Which of the following is an example of an industrial user
A hairstylist buying scissors to perform haircuts
Which of the following is an example of an ultimate consumer
A teenager buying their first car
What is expansion?
A time of economic growth and prosperity
Jake wanted to run his own business but was unsure that he had adequate business skills to be successful. Which type of business would give Jake the help he needs?
Business-format franchise
What is the third phase of Business cycles?
Contraction
The Scott Company decided to sell stock to raise capital. Under what form of business organization does the company operate?
Corporation
What is Contraction?
Economic activity is diminished; Some contractions become recessions/depressions
What is the first phase of Business cycles?
Expansion
Business cycles are predictable. True or False?
False
Wendy's sells the right to operate its restaurants to individuals who meet the company's criteria. The arrangement between Wendy's and these individuals is an example of
Franchising
Where does a channel of distribution begin
From the producer
What is distribution?
How income is divided among resource owners and producers
Which of the following statements is true regarding joint ventures:
Joint-venture arrangements are usually short-term relationships.
Olivia runs a home-based business that distributes high-quality, handmade baskets. She sells the products and earns commissions on the baskets sold by four other basket representatives. This is an example of
Multi Level Marketing
The American Red Cross is an example of a(n) ___________ corporation.
Nonprofit
What is the second phase of Business cycles?
Peak
What are human resources?
People who work to produce goods and services
What do business owners consider when they select a business ownership structure?
Personal circumstances, type of business, financial needs
What are the external factors of Business cycles?
Political changes climatic changes international relations discoveries and innovation psychological changes
What type of corporation may be owned by just a few people and does not offer its shares for sale to the general public?
Private
What distribution channel is used when the producer does not have its own sales force and the consumer is the industrial consumer?
Producer-->industrial distributor--> consumer
What type of corporation sells millions of shares and must furnish complete information about its earnings, assets, and debts?
Public
Illegally run organizations that emphasize the collection of high fees from potential product distributors are often referred to as
Pyramid Scheme
"To form my business, I used all of my savings, borrowed from the bank, and I'm personally liable for all of the debts." This is an example of which of the following forms of business ownership:
Sole proprietorship
What is Real Gross Domestic Product? (GDP)
The monetary value of all the finished goods and services produced within a country's borders in a specific time period
What is Economics?
The study of scarcity
What is aggregate demand?
Total demand for an economies products
What is money supply?
Total quantity of money which exists at one time in a nation
What is the final phase of Business cycles?
Trough
Which of the following is a benefit of channels of distribution
We can more easily obtain products from all around the world
What is a peak?
When economic prosperity reaches it's highest point
Which of the following products would likely use an exclusive distribution pattern
a gallon of milk
What are benefits?
advantages employees receive
What is demand pull inflation?
aggregate demand exceeds available supply
A retailer buys a variety of toys from a number of producers for sale in the same place. The retailer is reducing the discrepancy of
assortment
What is compliance?
complying with applicable laws and regulations (e. g. minimum wage) keeping employees safe and healthy protecting interviewee's rights administering contracts
Retailers perform an important channel activity by negotiating with consumers on issues such as
delivery
The first decision that marketers must make when managing channels is
determining distribution patterns
What does HR Management staffing include?
determining need determining job descriptions and specifications recruiting the right number of candidates selecting candidates to interview interviewing candidates extending and negotiating job offers overseeing orientation
Producers who eliminate all middlemen are known as to be using a
direct channel
What are business cycles?
economic fluctuations (ups and downs in the economy)
Producers are able to match their production to the needs of consumers because intermediaries
enable producers to promote goods
What does training and development entail?
ensuring that employees are knowledgeable and productive determining training needs assessing available resources overseeing performance management and improvement
The goal of distribution channels is to get from the producer to the
final consumers
If all of the individuals who own a business share unlimited liability for the business's losses, these individuals are part of a(n)
general partnership.
Channels of distribution benefit the producers by
getting their products to consumers more efficiently
What does managing employee relations include?
handling complaints mediating conflicts running employee assistance programs assisting in labor relations
When marketers are trying to reach anyone, this is called an
intensive distribution pattern
ABC Specialty Wear is the only company that has written permission to use a national football team's logo on its sportswear. This is an example of a
licensing agreement
What is a trough?
low point of economic activity but a sign of recovery
Channels of distribution benefit consumers by
making a variety of products available to consumers
John, Robert, and Charles were college friends who wanted to start a business. John has creative ability, Robert's expertise is selling, and Charles' expertise is management. However, each has limited capital. The ideal business ownership for these young men is a
partnership
What is compensation?
pay for work completed
Channel members add value to a product by
performing certain channel activities expertly
Jane is the owner of a pizza shop associated with a national chain of pizza restaurants. She established her business in a regional supermarket. The pizza shop is referred to as a
piggyback franchise
What is exchange?
producers, consumers, and resource owners exchange money payments
What is production?
producing goods/services + transforming resources into more valuable goods/services
Channels of distribution allow channel members to share
profits or risk
Channel members should share an equal commitment to a product's
quality
A wholesaler breaks down a shipment of a product and sells portions of it to retailers. The wholesaler is reducing discrepancy of
quantity
The government restricts flow of money by...?
raising taxes raising interest rates buying less
The costs of promoting products are often
shared by channel members
The government increases amount of money in circulation by...?
spending more lowering interest rates lowering taxes
What are HR management functions?
staffing compensation and benefits training and development compliance employee relations
The total numbers of members in a channel is called
the channel length
The use of intermedaries enables producers to make larger profits because
the intermediaries sell more than the producer could on its own
An intermediary function that makes goods available to consumers where they are wanted and needed is
transporting and storing
producer to agent to consumer
travel planning
What is consumption?
using goods/services
A producers feels that a retailer is not selling their product aggressively enough. This is an example of:
vertical conflict
An advantage for producers in a producer to wholesaler to retailer to consumer channel is that
wholesalers usually buy in large quantities
A state-chartered corporation that was developed to help small businesses by taxing them as individuals in a partnership is a(n) __________ corporation.
"S"/ Subchapter