Business Test 2

Which of the following is a difference between limited liability companies (LLCs) and corporations?

LLCs are subject to fewer reporting requirements than corporations.

Ethan is in the process of launching his new business venture that specializes in electronic waste recycling. During this period, he has been in constant touch with Lois Inc., who has seen success in this niche market. In this scenario, which of the following entrepreneurial development strategies is Ethan utilizing?

Learning from others

Which of the following is a characteristic of limited liability companies (LLCs)?

They are made to pay an annual franchise tax in many states.

The nation of Rhodasia has the lowest entrepreneurship rate globally. A new government, headed by President Harold David Wengerd, aims to make the country's business environment more supportive toward burgeoning entrepreneurs. Which of the following measures should be taken to increase the entrepreneurship rate in Rhodasia?

Eliminating complex regulations placed on businesses

Paulina, the CEO of a steel company, invites Joseph, the representative of a potential partner firm, to visit her company. She is careful not to stress on Joseph's religious background as a means to start off a conversation. Instead, she maintains a strictly professional conversation with Joseph and stays neutral to his religious background. Which of the following biases does Paulina avoid in the given scenario?

Ethnicity bias

Based on statistics from the U.S. Small Business Administration (SBA), small businesses account for 78% of all private sector employees.

False

Which of the following statements is true of a business plan?

It is absolutely crucial for obtaining outside funding.

In the context of franchising, which of the following statements is true of a business format franchise?

It is an agreement in which franchisor grants the franchisee the right to both make and sell its good or service.

Which of the following statements is true of activity-based costing (ABC)?

It is more complex than the direct labor method.

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

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

Identify a true statement about nonverbal communication.

Paying attention to a monotone takes more concentration than most people are willing to muster.

Congress passed the ______ that banned business relationships that might create conflicts of interest between certified public accounting (CPA) firms and the companies they audit.

Sarbanes-Oxley Act of 2002

Which of the following is a disadvantage of franchising?

The franchise agreement usually requires the franchisee to follow the franchisor's procedures to the letter.

One of the disadvantages of general partnerships is the lack of continuity.

True

Some businessmen, called necessity entrepreneurs, launch their business because they believe it is their only economic option.

True

A Franchise Disclosure Document (FDD) is:

a document provided by a franchisor to the franchisee.

Logan, an independent auditor, is assigned to perform an audit for a software company. After the audit, he notices some serious lapses and discrepancies in the numbers mentioned in the firm's financial statements. In this scenario, Logan is most likely to offer a(n) ________ opinion in his audit report.

adverse

Denise, the head of the marketing team of a company, holds a team meeting to thank all employees for their active participation in the corporate social responsibility activities organized by the company. While addressing the employees, Denise is careful not to use words such as "young" and "old." Instead, she uses words like "energetic" and "dynamic" to express enthusiasm. Which of the following biases is Denise avoiding in the given scenario?

age bias

In the context of the U.S. economy, small businesses:

are often the first to contract when times are tough.

A manager who does not use words such as "his," "young," "her," etc, in business communication is most likely trying to:

avoid bias

As globalization gains speed, intercultural communication will

become increasingly pivotal to long-term business success.

Drumming one's fingers on a desk while talking can distract the audience and create a ____ to communication.

body language barrier

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

business plan

As part of its financial budget, Clover & Max, an advertising agency, prepared a document that identified the agency's planned investments in major fixed assets and long-term projects. The given information indicates that the agency prepared the

capital expenditure budget

David, a German, and Rohit, an Indian, are representing their respective countries in a global summit. Unaware of each other's social practices, both David and Rohit are not able to communicate properly with each other. During lunch, Rohit eats bread with his hand, whereas David uses a fork and knife. This further reinforces their negative impression of each other. Which of the following communication barriers are David and Rohit facing in the given scenario?

cultural barriers

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

distributorship

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

distributorship

As a listener, you are most likely to interpret the maximum meaning from a speaker's:

facial expressions

John and Lena sign a contract with the owner of Little Fairy, a well-known preschool chain, to start a preschool in their city. They take permission from the owner to use the name and products of Little Fairy. They also furnish their preschool in Little Fairy's trademark style. In this scenario, John and Lena are starting a _______.

franchise

Harold, a financial accountant in a company, is asked to identify the changes in the company's account values between 2014 and 2016. To get the required information, he uses comparative financial statements, which state the figures for the two years side by side. These comparative financial statements make it easier for Harold to identify the changes that may have taken place during that period. In this scenario, Harold is most likely using _____ to get the required information.

horizontal analysis

Aegirine Corp., a publicly traded firm based in New Mexico, manufactures iron. According to U.S. securities laws, the firm must:

let an independent CPA (Certified Public Accountant) firm perform an annual external audit of its financial statements.

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

necessity entrepreneurs

The management of a sugar manufacturing company sets aside a sum of $50,000 in its budget for the purchase of new machinery that would double the production. In the given scenario, the management is in the process of planning the _____ of the company.

operating budget

A thriving cowboy culture encourages entrepreneurship. The term "cowboy culture" refers to a

standout individuals who break free of old ways attract attention and admiration in many of the countries with high entrepreneurship rates.

In the context of the statistics provided by the U.S. Small Business Administration (SBA), _____

the opening of new businesses has accounted for over 40% of net new jobs in the U.S. economy over the past two decades

A book publishing company follows a budgeting approach wherein the senior managers of the company prepare the annual budget with little or no input from the supervisory and middle managers. The company uses this approach as the owners of the company believe that the senior managers are more aware of the long-term strategic needs of the company. In this scenario, the book publishing company is using __________.

top-down budgeting

An advantage of franchising is the:

training and support provided by the franchisor.

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

unqualified

During his English class, Ingrid was struggling to focus on the presentation given by his professor as the classroom was freezing cold. Also, the professor's table was creaking. In this scenario, both the cold atmosphere in the classroom and the creaking table are _______ to communication.

physical barriers