business managment and ad.

Caitlin has three credit cards. She receives her credit card statement for one of the cards and has to decide how to pay the $500 she spent with that card. To pay the least for use of the credit, she should pay with __________ and make the __________ payment. A. cash; full B. cash; minimum C. another card; full D. another card; minimum

A; Cash; full. Paying the statement in full will assure that she does not have to pay extra interest on the balance and will help improve her credit history. Paying in cash is better for her credit history's health than paying with another card, because eventually she will have to pay the money owed on the other card. Paying for one card with another can lead to a downward spiral of credit card debt.

What component is important to include in all types of inquiry letters? A. Contact information B. Personal qualifications C. Project specifications D. Attention-getting title

A; Contact information. An inquiry is a request for information. Letters of inquiry are requests for information such as job openings with businesses, product specifications, prices, proposals, etc. To respond to an inquiry, the letter recipient must know to whom the information should be sent. Therefore, all inquiry letters should contain contact information—the inquirer's name, telephone number, mailing address, and/or e-mail address. Skills and qualifications might be included in a letter of inquiry that a job seeker sends to a potential employer. Project specifications might be included in a request for proposal. Letters of inquiry do not contain attention-getting titles.

Your interest and enthusiasm can help to create a sense of __________ within your work group A. cooperation B. disagreement C. security D. conflict

A; Cooperation. Having interest and enthusiasm can help you persuade others to help you, to work with you, or to cooperate with you in many different kinds of circumstances. Interest and enthusiasm are contagious and may help to reduce conflict and disagreements. Interest and enthusiasm do not affect security, which is freedom from danger, risk, or injury.

Which of the following is NOT a name for a medium of exchange accepted and backed by the government as payment for goods and services: A. Credit cards B. Legal tender C. Currency D. Bonds

A; Credit cards. They do not qualify as a medium of exchange because they only delay payment; they are not the payment itself. Legal tender and currency are two names for the same thing: government issued specimen that are accepted as payment for goods and services. Bonds are an example of legal tender.

Which of the following factors has the greatest effect on a consumer's buying behavior: A. Cultural influences B. Situational influences C. Individual influences D. Social influences

A; Cultural influences. Cultural influences have the strongest effect on a consumer's buying behavior, even stronger than social influences, individual influences, and situational influences.

The overall category of resources that makes it possible for businesses to produce the goods and services that consumers want to buy is __________ resources. A. economic B. human C. capital D. natural

A; Economic. Economic resources are the items that businesses use to produce goods and services. In economics, these resources are divided into three major groups or types: human, capital, and natural. Human resources are the people who work to produce goods and services. Manufactured items that are used to produce goods and services are called capital goods. Natural resources include items that are found in nature which are used to produce goods and services.

A primary activity in managerial control is A. evaluating. B. delegating. C. coaching. D. forecasting.

A; Evaluating. Control is the management function that monitors the work effort. To determine if employees or processes are working effectively and efficiently, managers compare the business's standards or goals with the actual output or desired result to evaluate performance. Delegating is an organizing task that involves assigning authority or responsibility to another person. Coaching is a directing activity and is an on-the-job instructional method in which a manager or supervisor is assigned a "coach" to set goals, give assistance in reaching goals, and give ongoing performance feedback. Forecasting is a planning activity that involves making estimates or predictions about something—sales, income, expenses, etc.

Lamar Enterprises is using a trademark that looks very similar to the Seward Company's trademark. To prevent Lamar from continuing to use the trademark, Seward can take legal action by A. filing an infringement lawsuit against Lamar B. charging Lamar with obstruction of justice C. requiring Lamar to pay a licensing fee D. obtaining an arrest warrant

A; Filing an infringement lawsuit against Lamar. A trademark is a symbol, design, or word used by a producer to identify a good or service. To prevent unauthorized use of the trademark (or a similar trademark), the trademark owner should register the trademark with the government. If another company (Lamar) uses a trademark that is similar to one that has been previously registered (Seward), the original owner (Seward) can file an infringement lawsuit against the company (Lamar) to stop the unauthorized use. And in some situations, the owner can obtain monetary damages from the unauthorized user. Directly asking Lamar to pay a fee is not a legal action. Obstruction of justice is a formal charge in which the judicial system accuses an individual with the crime of withholding critical evidence that can affect the outcome of a trial. An arrest warrant is an order issued by a judge that instructs law-enforcement officers to bring to jail an individual who has been charged with a crime.

If the cash from operating activities is consistently greater than the company's net income, the company's net earnings are of a(n) __________ quality. A. high B. low C. moderate D. excessive

A; High. The cash from operating activities is compared to the company's net income. If the cash from operating activities is consistently greater than the net income, the company's net income or earnings are said to be of a high quality.

What do businesses often develop to be able to store and analyze data for the purpose of making business decisions? A. Information systems B. Operating procedures C. Survey methods D. Management policies

A; Information systems. An information system is a method of gathering, storing, and analyzing data for the purpose of making business decisions. Businesses acquire vast amounts of information that must be stored and analyzed to make it useful. An effective information system enables a business to quickly and accurately process information and use that information to make decisions. Businesses do not develop operating procedures, survey methods, or management policies to be able to store and analyze data for the purpose of making business decisions.

Determining a project's feasibility, developing a statement of work (SoW), creating SMART objectives, and developing a project charter occur during the __________ stage of project management. A. initiation B. planning C. execution D. closure

A; Initiation. The project life cycle consists of four stages: initiation, planning, execution, and closure. The initiation stage involves determining a project's feasibility, developing a statement of work (SoW), creating SMART objectives, and developing a project charter. The planning stage involves in-depth project planning to ensure that the project's scope is clearly defined. This entails developing a Work Breakdown Structure, identifying needed human and nonhuman resources, developing a project schedule, and preparing a project plan. The execution, or implementation, stage requires the project manager to monitor and control project activities by maintaining ongoing communication with all project participants, updating and modifying the project plan, monitoring risks, controlling project quality, gaining change approvals, and maintaining project records. The closure stage entails writing final project reports and preparing a lessons learned document.

In a consensus-building group, the facilitator is the person who A. keeps the discussion on track. B. is in charge of the group. C. takes notes. D. makes sure everyone has equal time to speak.

A; Keeps the discussion on track. The facilitator is the person who serves the group. S/He is in charge of keeping the discussion on track and keeping things organized. If the consensus-building method is formal, the facilitator is the one to revise, distribute, and collect the questionnaires. The facilitator isn't in charge of the group. In fact, in consensus-building, no one is in charge because everyone has equal power. The note taker is the person who takes the notes, and the timekeeper is in charge of making sure everyone has equal time to speak.

The overall purpose of the Six Sigma quality-management framework is to satisfy customers and A. lower costs. B. simplify activities. C. improve technology. D. identify needs.

A; Lower costs. Quality management involves the coordination of resources to ensure the degree of excellence of a process, good, or service. Six Sigma is a quality-management framework that involves continuously setting higher goals of perfection. The Six Sigma framework builds upon previous goals to set higher goals in order to continuously improve the quality of the business's goods, services, or processes. The ultimate goal is to maximize outputs, have no process or product defects, and minimize production costs. Therefore, an important aspect of the Six Sigma philosophy is to continuously lower costs while improving quality. When quality improves, customer satisfaction tends to improve. To continuously improve, the business may determine that it needs to simplify activities, obtain better technology, or reevaluate its needs.

What activity helps businesses identify the various opportunities for continuous quality improvement? A. Monitoring data B. Setting goals C. Establishing budgets D. Rationing resources

A; Monitoring data. Continuous improvement is an ongoing process that looks for ways to increase the levels of excellence in relation to a process, good, or service. By monitoring various data, the business can detect problems, which can help the business identify ways or opportunities for improvement. After the business identifies opportunities for improvement, it can set goals to improve quality. The improvement goals may or may not include budget and resource issues.

Change management occurs in a cycle because A. organizations always need to change. B. organizations push for unnecessary change. C. change is harmful for most companies. D. change is difficult to implement.

A; Organizations always need to change. Change management occurs in a cycle because change is a constant need for organizations. It is not unnecessary or harmful. Change management may be difficult to implement sometimes, but this does not explain why it occurs in a cycle.

Which of the following is a characteristic common to all integrated software packages: A. Performs interrelated functions B. Calculates break-even points C. Requires minimal training D. Includes forecasting tools

A; Performs interrelated functions. Integrated software applications consist of two or more related computer programs that work together to record information or perform specific business tasks or functions. For example, Microsoft Office combines a variety of programs that perform word-processing, spreadsheet, slideshow presentation, desktop publishing, and database functions. Some integrated software packages are customized to perform interrelated activities for a specific industry, such as travel and hospitality. Not all integrated software packages calculate break-even points or include forecasting tools. Because integrated software options vary, the level of training that users need also varies.

Which of the following types of data analysis suggests a future course of action: A. Prescriptive analytics B. Predictive analytics C. Descriptive analytics D. Instructive analytics

A; Prescriptive analytics. Prescriptive analysis is a form of predictive analysis. Predictive analysis attempts to predict possible future outcomes. Prescriptive analysis takes it further and suggests one or more future courses of action, based on the predictions of possible future outcomes. Descriptive analysis, on the other hand, summarizes what has already happened by making raw data easy to understand and useful. Instructive analytics is not a form of data analysis.

Jacob is determining the writing style to use for an analytical report. If most readers are likely to support the report's content, Jacob should format the report for a(n) __________ audience. A. receptive B. indecisive C. argumentative D. intellectual

A; Receptive. An analytical report is a document that explains and evaluates an issue, opportunity, or problem. Often, the analytical report includes recommendations for a business to take a certain course of action. If the writer anticipates that most members of the audience are receptive and will agree with the recommendations, then using a direct approach to structure the report is optimal. The direct approach involves writing the report so it focuses the attention on the conclusions and recommendations. If the writer anticipates a skeptical, argumentative, or indecisive audience, the indirect approach may be the best way to structure the report. The indirect approach involves preparing a logical argument that supports the recommendations and focuses on the rationale behind the recommendations. Intellect refers to a person's level of understanding about a topic or concept, which varies per person and is not necessarily related to the structure of the report.

Which of the following is the last component of a research report: A. Recommendations B. Purpose of the study C. Background information D. Methodology

A; Recommendations. A research report is a written document that summarizes an investigation related to a particular issue or problem. The recommendations section is the proposed course of action, and it is the last component presented in the report. The purpose of the study, which appears at the beginning of the report, describes why the research is needed. The background or historical information is presented at the beginning of the report and usually appears after the purpose of the study. The methodology section of the report appears in the middle of the report and discusses the types of research tools used and why they were selected.

Which of the following employees has an operations management career: A. Samuel manages his company's call center. B. Kylie is a district manager. C. Wyatt is in charge of recruiting employees. D. Valerie trains her company's new employees.

A; Samuel manages his company's call center. Managing a call center is an operations management job duty. Kylie has a general management career, while Wyatt and Valerie have human resources management careers.

One reason that businesses use a matrix organizational design is to A. share human resources. B. improve employee productivity. C. segment areas of expertise. D. standardize business tasks.

A; Share human resources. The matrix organizational structure involves integrated departmental functions with product or project orientation. For example, a technology specialist, a marketing researcher, a financial advisor, and a manufacturing line supervisor are members of different departments but often work together to develop a product or improve a process. The advantage to businesses of using this organizational structure is that the business is applying its resources efficiently because a representative from each of the major departments provides a unique set of skills and knowledge to achieve the business's goals. Often, workers have two or more supervisors in the matrix organizational design. The matrix organizational design may improve the business's overall efficiency, but it does not always improve an individual's productivity. Departmental organizational design segments employees by their areas of expertise (e.g., accounting, sales, and production). Policies and procedures are developed to standardize various business activities and tasks in all types of organizational designs.

Identify the weakness of the following opening paragraph used in a letter of application: Your recent advertisment in the Gazette for a customer service representative is of interest to me. I would like to aply for the position. A. Spelling B. Format C. Grammar D. Punctuation

A; Spelling. The words "advertisement" and "apply" were misspelled in the opening paragraph. These errors will create a negative impression on the employer. Before submitting a letter of application, you should check for correct spelling, grammar, and punctuation. The opening paragraph does explain the reason that you are writing the letter—the purpose of the opening paragraph.

Jolie is working in a group in her business class. If she wants to contribute to her group's discussion in a meaningful way, what should she do? A. Summarize what's been discussed in the conversation B. Let someone know right away if his/her idea is bad or unrealistic C. Wait for other people to lead the conversation when it gets silent D. Ask questions as a way of judging someone else's suggestion

A; Summarize what's been discussed in the conversation. At the end of the group's discussion—or even at quiet moments along the way—it's helpful to summarize what's been discussed so far. Jolie shouldn't immediately close off an idea that's out of the ordinary—even if she thinks an idea is bad or unrealistic, it's important to listen to it. It's also important to avoid judging other group members' suggestions when asking questions. If there's a silent time when no one wants to speak, Jolie should be a leader and take the reins. She should not be intimidated by a quiet moment.

Serena is determining the specific activities needed to carry out a year-long advertising campaign. Serena is engaged in __________ planning. A. tactical B. strategic C. contingency D. long-term

A; Tactical. Tactical planning is short-range planning—one year or less—and involves determining the specific actions the business needs to take to carry out its strategic plan, which is more general in nature. A contingency plan is an alternative course of action that a business implements when it is not feasible to carry out the original plan. Long-term planning involves setting goals that will take the business more than a year to achieve.

Which of the following is an economic factor that affects business trends: A. The business cycle B. Lifestyle changes C. An aging population D. Emergence of social media

A; The business cycle. A trend is the general direction in which people or events are moving. Many factors lead to trends, including economic factors. The business cycle refers to the periods of expansion and contraction in economic activities. Changes in the business cycle affect the way businesses operate. For example, during a period of expansion, business production levels tend to increase, the unemployment rate tends to decrease, and consumer confidence and spending tend to increase. During times of economic contraction, the opposite occurs—business production tends to decrease, the unemployment rate tends to increase, and consumer confidence and spending tend to decrease. Demographic and psychographic changes may indicate trends that affect how a business relates to its target market. Demographic factors are the physical and social characteristics (e.g., age) of a population. Lifestyle changes are psychographic factors that affect business activities. The emergence and wide-spread use of social media is a technological trend.

An organization's product goals often involve setting standards for A. the variety of its goods and services. B. behavior in the workplace. C. expenses and income. D. the target market's expectations.

A; The variety of its goods and services. Organizational goals are the overall objectives or desired outcomes that the business wants to achieve. Businesses set different types of organizational goals. Product goals involve setting standards for various characteristics of the business's products—quality, style, durability, variety, etc. Expenses and income are budgeting (financial) considerations. Establishing guidelines for workplace behavior are human resources goals. Consumer goals involve setting standards and objectives to accommodate the target market's needs, wants, and expectations.

Tayari communicates openly, even when it's difficult. She demonstrates A. transparency B. fairness C.viability D. accountability

A; Transparency. Transparency means being truthful when you communicate. It involves speaking up about your feelings and communicating openly, even when it's difficult. Fairness, viability, and accountability are all important ethical principles, but they are not demonstrated in this example.

One way that employees can help to control a business's expenses is by A. rotating stock daily. B. arriving at work on time. C. overlooking thefts. D. handling products casually.

B; Arriving at work on time. Employees should arrive on time because the business pays them to work a specific amount of time. Rotating stock helps to keep merchandise fresh and appealing to customers, but daily rotation would increase expenses because of the time it would take. Employees should also help to control expenses by handling products carefully to prevent damage and by being on the lookout for thefts by customers or other employees.

Which of the following are examples of capital goods: A. Trucks, drum scanners, and minerals B. Bull dozers, photocopiers, and roads C. Tractors, laborers, and cranes D. Refineries, iron ore, and computers

B; Bull dozers, photocopiers, and roads. Capital goods are manufactured or constructed items that are used to produce goods and services. Bull dozers, photocopiers, roads, trucks, drum scanners, tractors, cranes, refineries, and computers are types of capital goods. Laborers are human resources. Minerals and iron ore are natural resources.

When Stefanie receives her credit-card statement at the end of the month, she sees that she was charged for a down-payment on a new car that she hadn't purchased. Which of the following is NOT something she should do: A. File a police report B. Call the car dealership C. Contact her credit-card company D. Check her credit report

B; Call the car dealership. It is more important for her to contact the credit agency and have them contact the dealership. She should file a police report immediately, because doing so will allow her to take legal action against the identity thief. Checking her credit report to make sure that it has not been affected is also something she should immediately do.

When RWQ Corporation could not obtain insurance coverage to cover a specific type risk from commercial insurance companies, it formed an insurance company to provide coverage for the risk. This is an example of a company managing its risk through a(n) A. organic entity. B. captive insurer. C. generic provider. D. lending institution.

B; Captive insurer. When businesses cannot obtain commercial insurance to cover a risk, they may legally form insurance companies as subsidiaries or sister companies to cover the losses associated with the risk. These insurance companies are called captive insurers because they exist only to serve a specific purpose—they are held "captive" by their parent companies. Lending institutions loan money to individuals and businesses. Generic provider and organic entity are not types of insurance providers.

While George is unable to work because of a back injury, he receives a check every week for 60% of his usual salary. George's check is a benefit of his __________ insurance. A. cash-value B. disability C. liability D. bodily injury

B; Disability. Disability insurance is sometimes called loss-of-income insurance because it pays a percentage of a worker's normal wages to the worker when s/he cannot work because of an illness or injury. It is often purchased through or by an employer. Cash-value is a type of life insurance that pays out the stated value of the policy at the time of death. Liability insurance protects property owners if someone else is injured on or by their property. Bodily injury is a type of liability insurance that protects vehicle owners when they cause injury to others.

Which of the following is a natural risk that businesses should consider when establishing their information-management procedures: A. Tax audit B. Fire C. Technology D. Privacy

B; Fire. Businesses should manage their information in ways that minimize risk. A natural risk is the possibility of loss resulting from natural causes such as floods, tornadoes, earthquakes, fire, etc. To minimize losses due to natural causes, businesses should keep hard copies or digital backups of crucial business records in a different location. A tax audit is an example of a financial risk. Failing to upgrade or keep up with new technical products is a technological risk. Businesses often have confidential information (e.g., customer credit-card information, business trade secrets), which should be secured to prevent risks associated with the invasion of privacy.

A common cause of back injuries on the job is A. poor posture. B. improper lifting. C. hard physical labor. D. sitting in one position.

B; Improper lifting. Many people hurt their backs because they have not learned proper lifting techniques. They lift a load that is too heavy, stand too far from the load, or use their back and arms to do the lifting. Poor posture and sitting in one position may cause some problems, but are not common causes of back injuries. Hard physical labor does not necessarily cause back injuries.

What would be the best response to write on a job application form for the reason that you left your last job if you quit because you felt your supervisor was unfair? A. Unable to get along with supervisor B. Left for a better job C. Unfair supervisor D. Unpleasant working environment

B; Left for a better job. When providing information about previous jobs, you should present a positive picture of yourself and your former employers. Avoid saying anything that puts you or a former employer in a negative light. Therefore, comments such as "unable to get along with supervisor," "unfair supervisor," and "unpleasant working environment" should be avoided. Telling a potential employer that you left to find a better job says nothing negative about your abilities or those of former employers.

Who is usually responsible for analyzing a business's income statement? A. Customers B. Managers C. Cashiers D. Bookkeepers

B; Managers. The income statement is usually analyzed by people who are responsible for the financial status of the business. This includes managers who look at ratios to monitor operations and determine whether a company is running efficiently. They also use the income statement to monitor yearly profit activity. Customers usually do not review a business's income statements unless they are also stockholders in the business. Bookkeepers usually are responsible for compiling income statement information but not analyzing it. Cashiers accept payments from customers, but they are not responsible for analyzing a business's income statements.

Having clear customer relationship management goals before putting a program into place helps businesses to avoid A. having unsatisfied customers. B. purchasing irrelevant technology. C. having to lay off employees. D. spending any money.

B; Purchasing irrelevant technology. Having clear customer relationship management goals before putting a program into place helps businesses to avoid purchasing irrelevant technology or enacting inappropriate procedures. It will not necessarily keep businesses from having unsatisfied customers or having to lay off employees. Businesses will most likely need to spend money on CRM programs, but having clear goals will keep them from spending money unnecessarily.

Which of the following is a benefit to businesses of orienting new employees: A. Increases profit B. Reduces turnover C. Provides information D. Eliminates training

B; Reduces turnover. The purpose of orienting new employees is to introduce them to the business and their new work environment, which includes supervisors and coworkers. When new employees are oriented properly, the turnover rate decreases because the new employees feel comfortable in their new surroundings and understand their role. One cause of high turnover among new employees is a lack of proper orientation because they do not know what is expected of them. Orienting new employees does not necessarily increase profit or eliminate training. The purpose of orientation is to provide information

Government protects consumers by establishing A. a measure of effectiveness in government. B. requirements for product testing. C. rules to generate competition. D. laws to monitor the growth of business.

B; Requirements for product testing. The government has passed many laws intended to protect consumers. In addition to requiring product testing, these laws prohibit false advertising and deceptive labeling, make food inspection mandatory, and set standards of safety in building construction. None of these laws are intended to monitor business growth or to generate competition. Making government effective does not necessarily protect consumers.

Matt is balancing his checkbook for the first time. He compares the checks he has written over the last month with those listed on his statement and finds that all of his checks have cleared. Next, he verifies that his latest paycheck, which he deposited the previous day, is on the list. It is not, so he adds it to his statement balance. After this, he should A. subtract any interest. B. subtract fees and charges. C. call the bank for a new statement. D. consider everything done.

B; Subtract fees and charges. To complete checkbook balancing, Matt needs to subtract fees and charges. Some financial institutions charge a monthly fee on bank accounts, especially those with less than a certain balance. They also have charges for new checks, bounced checks, etc. All of these charges must be subtracted from the balance in the check register to obtain an accurate monthly balance. Interest is added to, not subtracted from, the check register balance. Matt does not need to call the bank for a new statement just because the latest deposit is not on his current statement. He does need to subtract fees and charges and add any interest before he can consider everything done.

What are the three primary characteristics of an effective control system in a business? A. Responsive, flexible, and transferable B. Suitable, understandable, and timely C. Relevant, intangible, and rigid D. Rigid, economical, and reactionary

B; Suitable, understandable, and timely. Control is a management function that monitors the work effort. For managers to control business activities in an effective manner, control methods must be applicable for the situation (e.g., a graphic artist performs different activities than the plant manager), understandable so employees perform activities correctly, and timely (e.g., products are not shipped before they are packed appropriately). Generally, effective control systems are also economical (cost effective) and relevant. The rigidity, flexibility, transferability, responsiveness, and tangibility of the control system are often dependent on the situation.

Which of the following is a criterion for evaluating the reliability of a source: A. Length B. Timeliness C. Style D. Type of source

B; Timeliness. For certain types of information, it is crucial for the source to be up to date because data are always changing. Length and style are not necessarily indicators of reliability, though depending on the type of source, they may be important. The type of source does not always indicate reliability; many different types of sources are reliable.

Why might a business obtain a trademark for its intellectual property? A. To prevent the publication of the business's written work B. To protect the integrity of the business's logo C. To keep competitors from using the business's manufacturing processes D. To stop the unauthorized use of the business's inventions

B; To protect the integrity of the business's logo. Trademarks protect unique symbols, designs (e.g., logo), or words that businesses use to identify their brands. A business can legally protect its logo from unauthorized use by registering the logo with the appropriate government agency. If an unauthorized entity compromises or uses the logo in harmful, embarrassing, or negative ways, trademark protection provides the business with legal recourse. Copyrights provide legal protection for written, musical, and artistic works. Patents are obtained to legally protect inventions and certain types of processes (e.g., unique manufacturing processes) for a limited amount of time.

According to a company's most recent statement of cash flows, its cash flow from operations for the most recent year was $1,375,400. The net cash used by investing was an outlay of $690,000. The net cash spent on financing was $140,300. What was the company's free cash flow? A. $686,400 B. $549,700 C. $545,100 D. $830,300

C; $545,100. A company's free cash flow represents the funds available for internal growth and expansion. It also indicates how well the company is managing its money. A positive free cash flow is usually a sign that the company is practicing responsible money management, which can result in increased shareholder yield. A negative free cash flow, however, indicates that the company needs to look for more and/or other sources of funding. To calculate the free cash flow, we first need to determine the company's capital expenditures by adding together the net cash used by investing and the net cash used by financing ($690,000 + $140,300 = $830,300). Finally, subtract the total capital expenditures from the cash flow from operations ($1,375,400 - $830,300 = $545,100). So, the company brought in $545,100 more than it spent.

Madelyn is responsible for selecting Elite Manufacturing Company's new payroll-processing vendor. Madelyn has narrowed down her selection to three vendors and is favoring Pay Day Enterprises, the small company where her brother works. The primary concern with Pay Day is that it has never handled payroll for a company as large as Elite, which presents a business risk to the manufacturing company. This situation illustrates an ethical issue related to A. levels of service. B. financial reporting methodology. C. a conflict of interest. D. the company's structure.

C; A conflict of interest. Because Madelyn's brother works for a potential vendor, Madelyn may not be able to be objective and neutral when making a final selection for her employer's new payroll-processing provider. When selecting a vendor, it is important to be objective and consider all of the advantages, disadvantages, and potential risks with each candidate. A vendor that has not worked with large companies may not have the resources readily available to provide adequate service. Because Madelyn has a conflict of interest in this situation, she may want to seek input from her managers or formally request that someone else make the final decision. The situation presented does not involve an ethical issue related to financial reporting methodology, levels of service, or the company's structure.

Which of the following is a disadvantage of a checking account: A. Overdraft protection B. Direct payroll deposit C. Account balance requirement D. Online transaction options

C; Account balance requirement. Financial institutions often require customers to maintain a certain amount of money in their bank accounts. The account holder may be charged fees if the minimal account balance requirements are not met. Direct payroll deposit, overdraft protection, and online transaction options are benefits or services that many types of checking-account products offer that customers may need to pay fees to obtain.

Businesses often maintain records about vendors' pricing, delivery terms, and credit policies and use the information in the records to A. monitor inventory levels. B. negotiate higher discounts. C. award purchasing contracts. D. follow safe shipping procedures.

C; Award purchasing contracts. Businesses maintain records about their vendors and use the information in the records to award contracts to the most appropriate vendor. When selecting a vendor, a business usually wants to buy from the vendor that offers the best price for the value, has reasonable delivery terms, and favorable credit policies. By comparing the information about each vendor, a business can make an informed decision about the best vendor. This type of information does not help a business to negotiate higher discounts, monitor inventory levels, or follow safe shipping procedures.

Maxton Mart is being pressured by its vendors to pay for inventory it purchased more than 30 days ago. However, Maxton Mart has not received its accounts receivable from customers. What business record has Maxton Mart failed to monitor successfully? A. Balance sheet B. Income statement C. Cash flow D. Open to buy

C; Cash flow. By monitoring its cash flow statement, Maxton Mart knows when it is running short on cash and can take needed steps to alleviate upcoming cash shortages. If necessary, Maxton Mart should be prepared to take out a short-term loan to cover inventory costs. The income statement provides a picture of a business's profit or loss conditions. The balance sheet shows a snapshot of the business's assets, liabilities, and owner's equity. Open-to-buy documents indicate how much money the business has to invest in additional inventory.

A 12-screen movie theater recently opened in your neighborhood. Just a couple of months after it opened for business, the old single-screen drive-in movie theater nearby went out of business. This is an example of A. creative advantage. B. competitive advantage. C. creative destruction. D. competitive destruction.

C; Creative destruction. Creative destruction is a term coined by Joseph Schumpeter to describe how new goods and services can hurt existing products. For example, a new 12-screen movie theater is likely to draw customers away from an older single-screen drive-in movie theater nearby—causing the drive-in to go out of business. A competitive advantage is the edge achieved by businesses that offer something better than their competitors. Creative advantage and competitive destruction are not terms typically used.

Acceptance sampling is a part of statistical quality control that involves A. identifying the cause of quality problems. B. filling out control charts. C. determining whether to approve or reject an entire batch of products. D. painting a picture with descriptive statistics.

C; Determining whether to approve or reject an entire batch of products. Acceptance sampling is a part of statistical quality control that involves taking a random sample and determining whether to accept or reject the entire batch of products. Filling out control charts is part of statistical process control. Identifying the cause of quality problems is not a part of acceptance sampling. Descriptive statistics are a separate part of statistical quality control.

How does the fragmentation of processes help to protect a company's trade secret? A. The company will not need to monitor any part of the process. B. It replaces the need to obtain a copyright for intellectual property. C. Employees' knowledge is limited to a specific part of the process. D. The need for non-compete agreements is eliminated.

C; Employees' knowledge is limited to a specific part of the process. By limiting the amount of information employees have about an entire process, there is less risk that the company's trade secret will be revealed. For example, to protect Kentucky Fried Chicken's secret breading recipe (11 herbs and spices), the company mixes small increments of the breading in different locations. Then, the company collects and mixes the smaller increments to create the famous recipe. By fragmenting the mixing process, no single employee knows all of the ingredients. Fragmentation of processes does not replace the need to copyright written or artistic works, eliminate the need for non-compete agreements, or reduce the need to monitor all aspects of the production process.

Collaborative relationships with colleagues from other departments are beneficial to the business because they often A. support highly competitive attitudes. B. prevent workplace conflict. C. generate innovative ideas. D. facilitate independent behavior.

C; Generate innovative ideas. Collaboration involves working together in a cooperative manner. Colleagues from different departments often collaborate with one another to accomplish business goals. An advantage of collaboration is that colleagues from different departments have different perspectives, which can help generate innovative ideas for developing new products, improving processes, increasing productivity, and solving problems. Collaboration may reduce conflict, but it does not prevent it from ever happening. Although a little friendly competition among colleagues might positively affect some business activities, highly competitive attitudes tend to reduce trust and create a negative work environment. The goal of collaboration is interdependence (relying on one another) rather than acting independently (without others' input).

People are considered to be __________ resources. A. capital B. natural C. human D. physical

C; Human. In economics, people are valued for the work that they do to produce goods and services. This includes both mental and physical work. Natural resources are found in nature and are used to produce goods. Capital resources, also called capital goods, include all of the manufactured or constructed items that are used to produce goods and services.

A primary activity of the directing function of management is A. evaluating performance. B. identifying skills. C. initiating action. D. establishing authority.

C; Initiating action. Directing is the management function of providing guidance to workers and work projects. Providing guidance or instruction about the proper way to perform a task is initiating action. Skill identification is a staffing activity. Performance evaluation is a controlling activity. Establishing a line of authority is an organizing activity.

Which of the following terms are related to the concept of productivity: A. Profit and loss B. Supply and demand C. Inputs and outputs D. Competition and monopoly

C; Inputs and outputs. Productivity is the amount and the value of goods and services produced (outputs) from set amounts of resources (inputs). The other terms are not related to the concept of productivity. The law of supply and demand states that the supply of a good or service will increase when demand is great and decrease when demand is low. Competition is the rivalry between two or more businesses to attract scarce customer dollars. In a monopoly, a single business influences the entire production of a particular good or service. Profit is the income left once all expenses are paid, and loss is the income that is lost due to poor sales, added expenses, etc.

A business establishes virtual workspaces for several project teams in which information and expertise are continuously updated and shared among all of the work teams' members. What form of knowledge- management technology is the business using? A. Knowledge-mapping tools B. Remote search engines C. Knowledge repositories D. Decision-support systems

C; Knowledge repositories. Effective knowledge management tools support the collection and sharing of tacit and explicit knowledge. Knowledge repositories provide the team members of various teams and departments the ability to share their expertise to increase efficiency and solve problems. A search engine is a software program that automatically searches the Internet looking for information pertaining to specified search terms and displays a list of results. Knowledge-mapping software provides the ability to capture a business's information sources and information flow in a graphic format. Decision-support system applications retrieve and organize data to facilitate the business's decision-making processes.

Pedro Sanchez works as a loan processor for the MON Company, which is located in Smithsville. Pedro has recently approved an application to extend a $10,000 line of credit to Mrs. Jones. Who is the creditor in this situation? A. Mrs. Jones B. Pedro Sanchez C. MON Company D. City of Smithsville

C; MON Company. The debtor is the individual or business that owes money to another individual or business, which is the creditor. In the situation presented, MON Company is the creditor because the company has the finances to extend credit to Mrs. Jones (the debtor), allowing her to pay later. Pedro Sanchez is an employee of the creditor. The location of the company is not a factor in determining the debtor-creditor relationship.

Which of the following is the best example of the types of resources it takes to complete a project successfully: A. Encouragement B. Food C. Materials D. Energy

C; Materials. Completing a project successfully requires a mix of resources, including money, human resources, equipment, materials, etc. Although food, encouragement, and energy may be helpful, they are not as essential as having the right materials.

Which of the following is a formatting characteristic of a full-block business letter: A. Indented first paragraph B. Double-spacing within the paragraph C. No paragraph indents D. All paragraphs use right justification.

C; No paragraph indents. Many businesses use the full-block method to format business letters. All components of the letter (date, address, greeting, body, closing, signature block) use left justification, which means all text is aligned on the left side of the margin. Writers using the full-block format do not indent the first sentence of each paragraph. Other formatting characteristics of full-block letters are the use of single-spacing within the paragraphs and the use of double-spacing between the paragraphs.

What type of goal is designed to prevent or control internal organizational behavior? A. Profit B. Product C. Order D. Short-term

C; Order. Organizational goals are the overall objectives or desired outcomes that the business wants to achieve. Order goals are those that are designed to control or prevent behavior that may have a negative effect on the business. For example, order goals address ethics and legal issues and expectations in the workplace. Product goals relate to the goods and services the business produces. Profit goals are related to pricing goals. Short-term goals are goals that take less than a year to achieve.

Mitchell is reviewing internal data and proposals from several agencies to determine the best course of action for implementing a major advertising campaign for his company. What is Mitchell analyzing? A. Financial status B. Operating schedule C. Promotional needs D. Human resources

C; Promotional needs. Business analysis is the process of investigating and evaluating an issue, problem, process, or approach that affects the business. Analysis can help a business determine how to achieve its goals. Because the data and information that Mitchell is evaluating is related to an advertising campaign, he is evaluating a promotional issue—he is determining the best way to communicate product information to the target market. Although available human (internal and external) and financial resources are factors that Mitchell might consider as part of the analysis, the primary purpose is promotional rather than evaluating the business's operating schedule or its human resources.

Which of the following do purchasing personnel try to obtain, along with the lowest possible price: A. Security B. Loyalty C. Quality D. Publicity

C; Quality. Quality is the degree of excellence of a good or service. Purchasing personnel try to buy needed goods and services at the lowest possible price provided that quality does not suffer. Buying poor-quality goods at a low price is not efficient and may be costly to a business in terms of lost production or customer dissatisfaction. Loyalty is faithfulness. Security is safety from danger or risk. Publicity is any nonpersonal presentation of ideas, goods, or services that is not paid for by the company which receives it.

The purpose of depositing large bills in drop boxes upon receipt is to prevent A. burglary B. fraud C. robbery D. pilferage

C; Robbery. Cash drop boxes are built into the floor of the business and cannot be removed or opened by employees. Businesses using drop boxes often attempt to prevent robberies by posting a sign indicating that they use a drop box. Fraud, deceiving or cheating an individual or a business out of money; burglary, any illegal entry into a building to commit a theft; and pilferage, theft of small sums of money or inexpensive items, are all types of losses that businesses try to prevent.

Which of the following is an item that is subject to an excise tax: A. Prescription medication B. Carton of eggs C. Ski boat D. Business computer

C; Ski boat. An excise tax is a special government tax on certain nonessential and luxury items (e.g., ski boat) that is included in the price that consumers pay. Eggs, medication, and business computers are not luxury items that are subject to an excise tax.

Jana has a meeting with her boss for two hours at 10:00 Monday morning and is leading a videoconference at 4:30 that afternoon. Susan, a potential investor, calls Jana early Monday morning and says that she will be flying in from Portland Monday morning at 11:30. After she picks up her rental car, Susan wants to meet with Jana early Monday afternoon. Jana knows that meetings with her boss tend to last longer than expected, and that Susan will have a 45-minute drive from the airport to her office. The investor could really help the company, so Jana feels that it is important to meet with Susan. What should Jana tell this important potential investor about meeting on Monday afternoon? A. Ask Susan to meet her at her office at noon for a lunch meeting B. Tell Susan that Monday is a very bad day and suggest that they schedule a meeting the following week C. Suggest that they meet for lunch at 1:15 p.m. at a restaurant located between the airport and her office D. Advise Susan that she can meet her at the airport lounge at 3:15

C; Suggest that they meet for lunch at 1:15 p.m. at a restaurant located between the airport and her office. Managing your commitments in a timely manner means that you allow yourself enough time to complete important tasks. An important aspect of allowing yourself enough time to complete tasks is making sure that you "pad" your time in case unexpected situations occur that require immediate attention. In Jana's case, she has several important commitments in one day. It is important for Jana to meet with the Susan because she could provide the business with needed financial support. The best way for Jana to handle the situation is to suggest they meet for lunch between the airport and Jana's office at 1:15. This way, if Jana's meeting with her boss goes a few minutes longer than expected, she still has time to arrive for her meeting with Susan on time. Susan will have a rental car, so transportation is not an issue for her. It may not be convenient for Susan to meet with Jana the following week. Because Susan arrives at 11:30 a.m. and has a 45-minute drive from the airport, she could not meet at Jana's office at noon. A late meeting at the airport will not allow Jana enough time to get back to the office to lead her videoconference at 4:30.

The litigation process begins when A. the parties reach a settlement. B. the defendant files an answer with the court. C. the plaintiff files a complaint with the court. D. an appeal is considered.

C; The plaintiff files a complaint with the court. The litigation process begins when the plaintiff files a complaint with the court. The defendant cannot file an answer until the plaintiff files a complaint. Settlement and appeals occur later in the process.

Customers tend to look at a business as a whole despite the number of __________ they experience. A. feedback surveys B. complaints C. touch points D. purchases

C; Touch points. Customers tend to look at a business as a whole despite the number of touch points (interactions between businesses and customers) they experience. Customers' opinions of a business may or may not depend on their number of complaints, feedback surveys, or purchases.

Which task in the staffing process ensures that employees are knowledgeable and productive? A. Determining need B. Recruiting C. Training and developing D. Developing compensation plans

C; Training and developing. Training and developing is a part of staffing that ensures that employees are knowledgeable and productive. It includes training employees in new job positions as well as providing ongoing professional development. Recruiting is the process of attracting qualified candidates to the company. Determining need involves keeping constant tabs on what job positions need to be filled and what the descriptions and specifications are for those open positions. Developing compensation plans involves paying and providing benefits for employees.

What is the foundation of knowledge management? A. An unresolved conflict or problem B. An intangible product to market C. A place to store unrelated data D. A willingness to share expertise

D; A willingness to share expertise. Knowledge management involves leveraging the expertise, insight, and information of internal and external resources to help an organization achieve its goals. To leverage knowledge, employees must be willing to share information with their coworkers and managers. When employees are willing to share their ideas and expertise, it often makes it easier to resolve problems, develop new (tangible and intangible) products, and find connections among seemingly unrelated processes that will enhance efficiency.

John's business has been very successful the past year, and profits increased 15% over the previous year. John has decided to expand and to hire additional employees. This is an example of how profits A. provide necessary training for new employees. B. guarantee longevity of the business. C. increase the sales in a business. D. benefit society as well as business.

D; Benefit society as well as business. Profits benefit society and business by making it possible for businesses to grow and hire more employees. Earning profits does not guarantee the life of a business. Profits make it possible for employers to provide training, but training was not mentioned in this situation. Profits do not increase sales; increasing sales increases profits.

Frederic used to own the only pizza place in town—until a new place opened up. Even though Frederic's never been to the new pizza place, he tells everyone he meets that the new place uses inferior ingredients and has been investigated by the health department. He even leaves negative reviews of the pizza place online. Which business tort do Frederic's actions fall under? A. Wrongful interference B. Unfair competition C. Copyright infringement D. Disparagement

D; Disparagement. Frederic is making false statements about the quality of the new pizza place's food and the cleanliness of the restaurant. He is also leaving false negative reviews of the pizza place online. This constitutes disparagement. This is not an example of unfair competition or wrongful interference. Frederic is not infringing on the new pizza place's copyright.

Which of the following is the first step in developing a work breakdown structure (WBS) for a project: A. Determine how long it will take to complete each work task B. Ensure that work tasks are being completed in the proper order C. Evaluate the quality of completed activities in relation to the project goals D. Divide the workload into independent work packages

D; Divide the workload into independent work packages. A work breakdown structure (WBS) is the process of dividing project tasks into meaningful components to complete the project. The related activities in each component make up the work package. Work packages help the project manager effectively schedule, assign, and monitor project activities. After dividing the entire workload into independent work packages, the project manager can determine timeframes, monitor the work, and evaluate the quality of the work after the activities have been performed.SOURCE: PJ:006

What can a business do if it is exposed to risks that commercial insurance companies do not cover? A. Establish a risk-management committee B. Acquire a professional association C. Create a trade union D. Form a captive insurance company

D; Form a captive insurance company. Organizations (i.e., corporations, industry/professional/trade associations) often form their own insurance companies—called captive insurance companies—when they carry risks that commercial insurance companies will not cover. The organizations that form the captive insurance companies control insurance activities including the underwriting processes, premium rates, and claims-processing policies. Acquiring a professional association, establishing a risk- management committee, and creating a trade union are not ways in which a business transfers risk.

Which of the following business trends affects human resources management: A. Lack of new technology B. Costs of business going down C. No restructuring D. Globalization

D; Globalization. A growing trend toward globalization is one of many business trends that affects HR management activities. Costs of business are going up. Companies are often restructuring to save money. And, new technologies seem to pop up overnight.

What is an important question that a manager must consider when hiring a new employee? A. What are the company's product quality standards? B. What is the company's vision? C. How should the workload be distributed? D. How will the company compensate this worker?

D; How will the company compensate this worker? Staffing is the management function of finding workers for a business. Recruiting, interviewing, hiring, and training are staffing activities. When hiring an employee, the manager must consider how the business will compensate the employee. This involves determining the appropriate salary range for the job, insurance, vacation, and other benefits. The company's vision is a consideration of the planning function of management. Workload distribution is a consideration of the organizing function of management. Product quality standards are considerations of the controlling function of management.

An Internet and cable provider is considering whether to implement a new process that would require its customer service agents to work the phone lines for 24 hours a day instead of the previous 12 hours a day. What type of factor will most likely impact the design of this new process? A. Environmental B. Regulatory C. Technological D. Human

D; Human. People can have a large impact on the design of a process. Stress, employee morale, and fatigue are common human factors that can influence process design. If the Internet and cable company wants to increase its customer-service phone line hours, it will need to consider that its employees may not be able to take on any extra work or may become fatigued from the extra hours. Regulatory and environmental factors that affect process design include government regulations and the political or social environment surrounding a company. Technological factors include the cost of necessary equipment or technology.

Ali wants to negotiate with her boss to take on more job responsibilities. Before approaching her boss, Ali needs to determine her boss's position and A. procedures B. abilities C. standards D. interests

D; Interests. The key to successful negotiation is to focus on interests. Interests are the things that you and the other party want or need. You must consider the other party's interests as well as your own. Ability is a skill someone uses to perform a task through knowledge, training, and practice. When negotiating, one party may not necessarily know the other party's skills. Standards are specifications or statements that are used as a basis for comparing or judging goods or services. Procedure refers to the step-by-step process someone follows when performing a specific task.

How does having a sense of humor help you maintain a positive attitude? A. It encourages you to give your appearance the attention it deserves. B. If you hang out with positive people, you'll be positive as well. C. It is easier to maintain a positive attitude when you're healthy. D. It keeps you from taking yourself too seriously.

D; It keeps you from taking yourself too seriously. Having a sense of humor helps you maintain a positive attitude because it keeps you from taking yourself too seriously. Being able to laugh at yourself and at annoying things that happen is very good for your positive attitude. It helps you keep things in perspective. Having a sense of humor does not have anything to do with hanging out with positive people, staying healthy, or giving your appearance the attention it deserves.

When preparing her company's budget, Tatiana's manager told her that the company would be merging with another company. To maintain her ethics, Tatiana should A. report this information to the SEC. B. make sure the merger benefits the public interest. C. maintain her independence. D. keep this information confidential.

D; Keep this information confidential. Confidentiality is the practice of keeping information secret or private. Accountants have a legal responsibility to protect their clients' information. Tatiana should therefore keep information about her company's upcoming merger confidential. Tatiana does not necessarily have any control over whether or not the merger benefits the public interest. There is no indication that Tatiana has a conflict of interest that would require her to maintain her independence. Also, there is no indication that Tatiana should report the information about the merger to the SEC.

Purchasing can help manufacturing businesses to sharpen their competitive edge by A. promoting products to customers. B. maximizing inventory investment. C. limiting shipment of goods. D. keeping their prices down

D; Keeping their prices down. Purchased items, such as supplies, services, or raw materials, add to the final cost of a manufactured product. Purchasing can help to keep prices down by keeping costs down. Purchasing is not responsible for product promotion. Limiting shipment of goods would cause customer complaints. Maximizing

Incorrect information on an individual's credit report may hinder his/her ability to A. earn interest on stock holdings. B. withdraw money from a savings account. C. pay monthly credit card balances. D. obtain a bank loan.

D; Obtain a bank loan. Banks obtain credit reports to make decisions about providing loans; therefore, it is important for individuals to periodically review the accuracy of their credit reports. By obtaining copies of their credit reports from an authorized credit agency, individuals can identify problems and take corrective action. Information presented in a credit report does not affect an individual's ability to withdraw money from a savings account, pay monthly credit card balances, or earn interest on stock holdings.

Which of the following is an example of employee pilferage: A. Hacking into a competitor's computer network to obtain trade secrets B. Changing the amount specified on a check you prepare for the company with authorization C. Installing personally owned software on your workplace computer D. Padding an expense account

D; Padding an expense account. Employee pilferage involves the taking of small amounts or small articles without the consent of the company. That is what occurs when an employee pads his/her expense account. Having authorization to change the amount specified on a check is not pilferage. Installing personally owned software on your computer may violate company policies; however, it does not represent employee pilferage. Hacking into a competitor's computer network to obtain trade secrets is a computer crime, rather than pilferage.

In calculating gross domestic product, the goods and services that schools and churches purchase for their own use are considered to be part of A. foreign trade deficits. B. private domestic investment. C. government transfer payments. D. personal consumption expenditures.

D; Personal consumption expenditures. Personal consumption expenditures include the final market value of all sales of goods and services purchased for direct consumption by an individual, by families, and by nonprofit organizations such as schools and churches. Personal consumption expenditures are one of the factors used to calculate gross domestic product (GDP). Private domestic investment, government transfer payments, and foreign trade deficits are other factors that are taken into consideration when calculating GDP.

When entering into a contract with another business, an agent is the party that represents the A. consultant. B. defendant. C. opposition. D. principal.

D; Principal. In the legal system, an agent is a person who acts on the behalf of his/her client. The client is called the principal. A defendant is a person who is charged with a tort or crime. Opposition refers to the other party involved in a contract or dispute. A consultant is an advisor.

Which of the following is an ethical issue resulting from internal risks: A. Boycotting the use of an insurance company that has a reputation for not correcting its mistakes B. Revealing discounted expenses C. Selecting an insurance company that considers paying fines a cost of doing business D. Providing incomplete data for audits

D; Providing incomplete data for audits. Ethical risk management must be implemented by everyone in an organization to protect the company's credibility with its stakeholders. By providing incomplete data for audits, employees are acting unethically and risking the company's future existence. Revealing discounted expenses is an ethical action. Using or not using insurance companies represents external risks for a business.

In which component of a research report should the writer place the following statement: "Based on our findings, we believe that it is imperative that PNJ Corporation make the necessary adjustments." A. Methodology B. Analyses C. Assumptions D. Recommendations

D; Recommendations. The recommendations section is the last component of a research report and contains a proposed course of action (recommendation), which is based on the results or findings. The methodology section of the report outlines the research plan. It appears in the middle of the report and discusses the types of research tools used in the study and why they were selected. The analyses section of the report describes the findings based on the assumptions made and the methodology used to obtain the data.

Which of the following is a true statement about trade industries: A. Trade industries have very little flexibility because of their size. B. Most trade industries are large and employ many people. C. Trade industries modify or change the form of products. D. The main types of trade industries are retailers and wholesalers.

D; The main types of trade industries are retailers and wholesalers. Retailers sell to ultimate consumers, while wholesalers sell to other businesses. Trade industries do not modify or change the form of products. Instead, they are responsible for moving goods from producers to consumers or to industrial users. More than 80% of trade businesses are small, employing fewer than 20 people. These privately owned trade businesses have a great deal of flexibility.

Which of the following is a true statement about secondary dimensions of diversity: A. They are mental aptitudes. B. They are physical traits. C. They are determined by a person's subculture. D. They can change over time.

D; They can change over time. Secondary dimensions of diversity are differences that may change at various points throughout one's lifetime and include characteristics such as language, religion, income, geographic location, family status, work experience, communication style, and education level. Physical traits and mental aptitudes are primary dimensions of diversity, which are inborn differences that cannot be changed. These differences include gender, age, race/ethnicity, etc. Subculture is a secondary group within a dominant culture. For example, suppose that a U.S. citizen has parents of Chinese decent; the Western culture is most likely the person's dominant culture, while his/her Chinese heritage represents a subculture. A person's subculture may influence some of a person's secondary dimensions of diversity, but it does not determine these dimensions.

Why does a business keep stock on hand for resale? A. So it can buy raw materials B. So it can produce manufactured goods C. To use it in business operations D. To sell it to end users

D; To sell it to end users. Businesses keep different types of inventory on hand for different reasons. If the business sells the goods that it buys to end users, it is resale stock. For example, an appliance-store chain (retailer) buys stoves, refrigerators, and dishwashers from manufacturers, and sells the items to consumers. Items such as parts (e.g., nails) and raw materials (e.g., wood) are used to produce manufactured goods. Businesses also maintain an inventory of supplies (office, cleaning) for employees to use to complete their work.