C201 Business Acumen
Incentives to motivate employees to perform at their highest level are strongest in _____ systems. A. capitalist B. communist C. socialist D. collectivist
A. capitalist
In which three ways does business-buying behavior differ from consumer-buying behavior? Choose 3 answers A. A group or committee often makes decisions. B. Purchasers follow an ad hoc process. C. Purchasers often invite selected providers to bid on a purchase. D. Buyers treat each buying decision independently. E. Buyers face organizational influences that affect their own preferences.
A. A group or committee often makes decisions. C. Purchasers often invite selected providers to bid on a purchase. E. Buyers face organizational influences that affect their own preferences.
Which two economic impacts should a manager anticipate when the U.S. government reduces the number of Treasury bills, Treasury Notes, and Treasury bonds it sells? Choose 2 answers A. A rise of interest rates on these securities B. An increase in overall cost of debt to private borrowers C. An increase of foreign investment D. An increase of funds for public services
A. A rise of interest rates on these securities B. An increase in overall cost of debt to private borrowers
Which marketing tool is often used to build effective relationship marketing campaigns? A. Affinity programs B. Logistics C. Distribution strategies D. Product mix
A. Affinity programs
What are three qualities of strong brand equity? Choose 3 answers A. Awareness B. Loyalty C. Favorable images D. Trademark E, Cost-based pricing
A. Awareness B. Loyalty C. Favorable images
In which type of security should a business invest its excess cash in anticipation of paying off the current year's tax liability? A. Commercial paper B. Preferred stock C. Municipal bonds D. Common stock
A. Commercial paper
Engineers at Ford Motor Company use computers to build new car models in the virtual world before they are ever built in automobile plants. These engineers are using _____. A. computer-aided design B. flexible manufacturing systems C. computer-aided manufacturing D. computer-integrated manufacturing
A. computer-aided design
What is the first step in the strategic planning process? A. Define an organization's mission. B. Assess the competitive position. C. Develop strategies for reaching objectives. D. Monitor and adapt plans.
A. Define an organization's mission.
Which economic graph is used by organizations to regulate production by predicting the amount of product buyers will purchase at different prices? A. Demand curve B. Price sensitivity scale C. Product value scale D. Product-price equilibrium
A. Demand curve
A company might divide itself into smaller groups that best match the types of customers it serves. What is this is an example of? A. Departmentalization B. Organization C. Strategic Planning D. Decentralization
A. Departmentalization
What should a firm do to manage the risk of using leverage when exploring long-term funding options? A. Ensure that earnings remain larger than interest payments B. Capitalize returns to shareholders to maximize retained earnings on invested funds C. Hedge against borrowed funds with an equal amount of equity capital D. Subordinate dividends to interest payments to creditors
A. Ensure that earnings remain larger than interest payments
Which three characteristics make commercial paper a low-risk, attractive source of short-term funding for a business? Choose 3 answers A. It can make large amounts of money available. B. It carries interest rates that are 1 to 2 percent less than bank loans. C. It can be issued by virtually any business. D. It is sold in multiples as low as $10,000. E. It has a maturity that ranges between 1 and 270 days.
A. It can make large amounts of money available. B. It carries interest rates that are 1 to 2 percent less than bank loans. E. It has a maturity that ranges between 1 and 270 days.
A company wishes to determine if it should fund a project with bonds or equity.Which business concept would it most likely use to assist in the decision? A. Leverage B. Financial plan C. Liquidity D. Monetary policy
A. Leverage
Which two of the following distribution channels would take title of the products they handle? Choose 2 answers A. Limited-function merchant wholesaler B. Agents C. Full-function merchant wholesaler D. Brokers
A. Limited-function merchant wholesaler C. Full-function merchant wholesaler
Which of the following are combined to result in mass production? A. Mechanization, specialized skills, and standardization B. Mechanization, specialized labor, and robots C. Standardization, job-order production, and specialized labor D. Analytic systems, synthetic systems, and continuous processes
A. Mechanization, specialized skills, and standardization
Which users of financial statements use the financial statements to evaluate operations of the firm and to make investment decisions? A. Owners and creditors B. Employees and union officials C. Management D. Independent accountants
A. Owners and creditors
A bakery customizes cakes for clients as well as accepts budgets within which they should be made. This is an example of a _____ production system. A. customer-driven B. flexible C. mass D. process-oriented
A. customer-driven
Which three factors suggest a product should be marketed as a specialty product? Choose 3 answers A. Priced high B. Priced low C. Purchased frequently D. Purchased infrequently E. Available from a large number of retailers F. Available from a small number of retail outlets
A. Priced high D. Purchased infrequently F. Available from a small number of retail outlets
Which two characteristics does a Just-In-Time (JIT) System have? Choose 2 answers A. Production using JIT reduces a firm's inventory costs. B. JIT production reduces the risk of a production shutdown. C. A JIT system seeks to eliminate anything that does not add value in operations activities. D. JIT reduces the need for forecasts.
A. Production using JIT reduces a firm's inventory costs. C. A JIT system seeks to eliminate anything that does not add value in operations activities.
Which three characteristics are measured in demographic segmentation? Choose 3 answers A. Race and ethnicity B. Geographic location C. Income D. Purchase history E. Household size
A. Race and ethnicity C. Income E. Household size
What three factors should be addressed in a successful marketing plan? Choose 3 answers A. Target market B. Product gross margin target C. Sales revenue goals D. Product specifications E. Plan implementation timeline
A. Target market C. Sales revenue goals E. Plan implementation timeline
Assume that the number of people wanting to buy houses in your locality increases sharply. This will cause the price of houses to increase, which is an example of _____. A. demand-pull inflation B. credit deflation C. cost-push inflation D. supply-side deflation
A. demand-pull inflation
Which financial statement should an investor examine to identify the liabilities of a firm? A. The balance sheet B. The income statement C. The statement of owner's equity D. The statement of cash flows
A. The balance sheet
What are three ways cloud computing services enhance company productivity? Choose 3 answers A. Through more efficient application updates B. Through better resource utilization C. Through greater application availability for remote workers D. Through elimination of application downtime E. Through dedication of resources to each user
A. Through more efficient application updates B. Through better resource utilization C. Through greater application availability for remote workers
Which three sources should a business consider when seeking a long-term funding source? Choose 3 answers A. Venture capital B. Public sale of stocks C. Commercial paper D. Hedge funds E. Trade credit
A. Venture capital B. Public sale of stocks D. Hedge funds
Which two risks does a firm face by funding the purchase of long-term assets with short-term funding sources? Choose 2 answers A. Volatility of interest rates B. Faster depreciation of long-term assets C. Negative credit rating D. Frequent renewals
A. Volatility of interest rates D. Frequent renewals
Boca Bearing Company produces 30 basic types of ball bearings. Its manufacturing system uses computer-controlled machining centers, robots, and remote-controlled carts to deliver materials. In addition, the system can be modified quickly to produce the different ball bearings. The manufacturing system that is described is a _____ system. A. flexible manufacturing B. computer-aided design C. synthetic manufacturing D. static manufacturing
A. flexible manufacturing
TryDent is a dentist's office with three employees: a receptionist, a housekeeper, and a manager. The manager is responsible for all activities in the dentist's office. In the context of organization structure, TryDent is a _____. A. line organization B. committee organization C. divisional organization D. matrix organization
A. line organization
Farm laborers are out of work for some months after they have harvested and sold their produce. This is an example of _____. A. seasonal unemployment B. cyclical unemployment C. structural unemployment D. frictional unemployment
A. seasonal unemployment
Conceptual skills are especially important for _____, who must develop long-range plans for the future direction of their organizations. A. top-level managers B. middle managers C. supervisory managers D. first-line managers
A. top-level managers
With which two types of products does a marketing strategy rely on advertising more than personal selling? Choose 2 answers A. Capital products bought with budgeted funds B. Accessories to primary products C. Component parts of primary products D. Consumable supplies
B. Accessories to primary products D. Consumable supplies
After years of marketing a body lotion, a cosmetics company begins promoting the lotion as an insect repellent as well.In which three product life cycle extension strategies did this company engage? Choose 3 answers A. Increasing the frequency of shopper visits B. Adding new users C. Re-branding the product D. Increasing frequency of use E. Finding new uses for the product
B. Adding new users D. Increasing frequency of use E. Finding new uses for the product
Fiscal policy involves: A. adjusting money supply by varying the exchange rate of the national currency. B. influencing economic activities by making decisions about taxes and government spending. C. curbing political activities by limiting the spending on political campaigns. D. controlling the flow of foreign currency by reducing exports and increasing imports.
B. influencing economic activities by making decisions about taxes and government spending.
A company that is based on a direct flow of authority from the top executive to subordinates is known as a _____ organization. A. committee B. line C. line-and-staff D. matrix
B. line
For which type of communication should employees have an ethical expectation of privacy from company monitoring? A. Personal calls made on company phones B. Personal emails sent from work computers C. Personal letters sent through the company mail room D. Personal emails received on work accounts
C. Personal letters sent through the company mail room
Which of the following forms of organizations is common in midsize and large firms? A. A committee organization B. A line-and-staff organization C. A matrix organization D. A line organization
B. A line-and-staff organization
Which two activities are prohibited by insider trading laws and should be avoided by a firm's employees? Choose 2 answers A. Unloading company stock because the employee has observed the company's lax quality control process B. Buying stock in the public company for which the employee works based on a conversation the employee overheard at a cocktail party between two of the company's executives C. Selling company stock because a co-worker told the employee the company's new drug is failing in clinical trial D. Buying stock in a public company based a Fortune article mentioning a possible hostile takeover bid by its largest competitor
B. Buying stock in the public company for which the employee works based on a conversation the employee overheard at a cocktail party between two of the company's executives C. Selling company stock because a co-worker told the employee the company's new drug is failing in clinical trial
How does a sudden shortage of a commodity product affect the immediate demand for the product at its current price? A. Demand diminishes B. Demand increases C. Demand is unchanged D. Demand curve is skewed
B. Demand increases
Which part of the organizing process aids in effective and efficient progress toward planned goals and often results in changes within the organization? A. Promoting vision B. Evaluating results C. Turning strategy into action D. Determining the specific activities
B. Evaluating results
Which of the following is true of monetary policy? A. It is a mechanism to control the flow of foreign currency into a nation by reducing its exports. B. It uses variations In interest rate and money supply to influence a nation's economy. C. It uses taxation and spending to control economic activities. D. It is dictated by international organizations like the United Nations.
B. It uses variations In interest rate and money supply to influence a nation's economy.
A country has a strong private sector, along with publicly-owned enterprises. Entrepreneurs and private-sector investors are entitled to profits after paying taxes, and even state-owned enterprises are expected to generate returns. What type of economic system does this country have? A. Socialism B. Mixed economy C. Self-managed economy D. Communism
B. Mixed economy
Before the patent on its allergy medicine expired, Renova Pharma Inc. was able to set its own market price for the drug. From which type of market structure did the company benefit? A. Monopolistic competition B. Monopoly C. Oligopoly D. Pure competition
B. Monopoly
Which calculation determines a firm's return on equity? A. Average equity divided by net income B. Net income divided by average equity C. Shareholder's equity divided by gross profit D. Gross profit divided by shareholder's equity
B. Net income divided by average equity
Which element of the promotional mix has the advantage of messaging that can be tailored for each customer, but the disadvantage of a high cost per contact? A. Advertising B. Personal selling C. Sales promotion D. Sponsorships
B. Personal selling
Which three tasks are key responsibilities of operations managers?Choose 3 answers A. Selecting the goods to offer customers B. Planning the overall production process C. Determining the best layout for the firm's facilities D. Implementing the production plan E. Monitoring product distribution
B. Planning the overall production process C. Determining the best layout for the firm's facilities D. Implementing the production plan
Juan is a production manager. Which of the following tasks would Juan complete first? A. Determining what products to produce B. Planning the production process C. Implementing the production process D. Selecting the appropriate layout
B. Planning the production process
Sakura is a production manager and has decided that grouping machinery and equipment according to their functions works best at her company. What layout would be her company be using? A. Product B. Process C. Fixed D. Customer oriented
B. Process
_____ departmentalization organizes work units based on the goods and services a company offers. A. Process B. Product C. Functional D. Geographical
B. Product
The goal of _____ is for companies to eliminate virtually all defects in output, processes, and transactions. A. WTO B. Six Sigma C. NATO Business Alliance D. ISO
B. Six Sigma
Tom has been unemployed for a long time because he has not been able to find a job in which he can apply his specialized knowledge about the Robostic Data System (RDS), a computer system that is now obsolete. What type of unemployment is Tom facing? A. Seasonal unemployment B. Structural unemployment C. Frictional unemployment D. Cyclical unemployment
B. Structural unemployment
For which two purposes will the U.S. Federal Reserve System follow an expansionary monetary policy? Choose 2 answers A. To hedge against inflation B. To encourage bankers to make loans C. To discourage overexpansion D. To cut the cost of borrowing
B. To encourage bankers to make loans D. To cut the cost of borrowing
A local bookstore uses an organizational structure in which authority and responsibility are jointly held by the entire group rather than by a single manager. This company is using a _____ organizational structure. A. line-and-staff B. committee C. matrix D. functional
B. committee
Yusted's company uses a computer to control its production process. The computer transmits signals to machines for performing the appropriate steps in the correct order. This is an example of _____. A. computer-aided design B. computer-aided manufacturing C. flexible manufacturing D. computer-integrated manufacturing
B. computer-aided manufacturing
Fiona, president of Technicolor Graphics, is highly respected for her ability to analyze and interpret the trends in the rapidly changing graphics industry. Fiona has effective _____ skills. A. technical B. conceptual C. human relations D. supervisory
B. conceptual
Hospital rooms are typically set up with a _____ layout. A. fixed-position B. customer-oriented C. product D. process
B. customer-oriented
In general, as price of a good or service increases, the quantity demanded: A. first increases and then decreases irrespective of the product type. B. declines. C. increases. D. remains the same irrespective of the product type.
B. declines.
Which two factors drive demand in a microeconomic system? Choose 2 answers A. Production B. Component shortage C. Price of substitute goods D. Customer preference
C. Price of substitute goods D. Customer preference
A customer intends to purchase her favorite cereal. It is out of stock, so she purchases an alternative brand of cereal instead.Which stage of brand loyalty is this customer in? A. Brand equity B. Brand insistence C. Brand preference D. Brand recognition
C. Brand preference
Which two impacts result from a nation's increase in productivity? Choose 2 answers A. Hourly wages increase B. Per capita output diminishes C. Economy expands D. Commodity prices increase E. Personal wealth increases
C. Economy expands E. Personal wealth increases
How does a virtual private network contribute to a firm's workforce productivity? A. Employees have dedicated resources solely for their use on the corporate network. B. A VPN pools network resources for employee use when working remotely. C. Employees are enabled to work remotely with secure connectivity to the corporate network via the internet. D. A carrier's facilities provide a secure, dedicated connection to the corporate network.
C. Employees are enabled to work remotely with secure connectivity to the corporate network via the internet.
Which aspect of operations management do the ISO 9000 standards address? A. Efficient use of resources B. Adherence to environmental regulations C. Establishment of effective quality systems D. Development and manufacture of products that are high-quality
C. Establishment of effective quality systems
A luxury car manufacturer produces cars in large numbers but allows clients to pick their choice of materials for the upholstery and paneling and the exterior paint work. Which of the following best describes this process? A. Mass production B. Customer-driven production C. Flexible production D. Computer-aided manufacturing (CAM)
C. Flexible production
How did the Dodd-Frank Wall Street Reform and Consumer Protection Act impact retailers? A. It capped the liability of consumers for credit card fraud at $100. B. It enabled retailers to seek reimbursement for fraudulent credit card charges. C. It capped the debit card swipe fee at 21 cents. D. It allowed banks to levy the debit card swipe fee on cardholders.
C. It capped the debit card swipe fee at 21 cents.
Why does a line organizational structure function most effectively in a crisis situation? A. It provides specialized expertise, advice, and guidance. B. It draws on temporary resources needed in an emergency. C. It establishes a direct flow of authority. D. It places authority in the hands of a group of individuals rather than a single person.
C. It establishes a direct flow of authority.
Which funding source should a firm use if it wishes to secure long-term financing while retaining all of its equity? A. Venture capital B. Public stock sale C. Long-term commercial bank loan D. Private equity fund
C. Long-term commercial bank loan
Which two activities are finance activities rather than accounting activities? Choose 2 answers A. Reconciliation of financial statements B. Recording of business transactions C. Making capital market investments D. Managing cash flow E. Creating a financial plan
C. Making capital market investments E. Creating a financial plan
United Narva is a nation in which industries like steel, communications, electricity, railways, education, and health care are owned by the government. The leaders of the nation believe that it is detrimental to the public's interest to allow such core industries to be owned by private firms. However, private ownership is encouraged in industries like restaurants, entertainment, and retail shops, which have a lower impact on social welfare. Which of the following economic systems has United Narva adopted? A. Communism B. Capitalism C. Socialism D. Individualism
C. Socialism
What is considered the heart of any information system? A. The operating system B. The applications C. The database D. The physical infrastructure
C. The database
Which intent of spyware creates a company security issue? A. The intent to sabotage programs with malicious intent B. The intent to destroy data contained on storage devices C. The intent to report on a user's Internet activity D. The intent to deny network access to outside users
C. The intent to report on a user's Internet activity
Why should a manager use financial controls in a firm's financial plan? A. To prevent unauthorized expenditures in variance with the financial plan B. To pace the inflow of revenue and outflow of expenses C. To determine the accuracy of forecasted revenues, costs, and expenses D. To identify and incorporate unanticipated costs related to business operations
C. To determine the accuracy of forecasted revenues, costs, and expenses
Who are most likely to make decisions regarding the purchase of other companies? A. Supervisors B. First-line managers C. Top managers D. General managers
C. Top managers
When would a pull promotional strategy enhance a competitive advantage to market a product better than a push strategy? A. When the product is best sold through personal selling activities. B. When demand for the product is driven by marketing intermediaries. C. When demand for the product is driven by the end user. D. By combining messages of price-value, product differentiation, and prestige into a focused campaign.
C. When demand for the product is driven by the end user.
The production facility for a space shuttle would probably be organized according to a _____ layout. A. process B. customer-oriented C. fixed-position D. product
C. fixed-position
An advertising agency creates departments for creative personnel, media buyers, and account executives. This is an example of _____ departmentalization. A. geographical B. product C. functional D. process
C. functional
Solomon's firm is divided into work units representing human resources, marketing, production, and finance. This is known as _____ departmentalization. A. process B. product C. functional D. geographical
C. functional
When Zeenath instructs new employees on handling customer complaints, she motivates them to respond with patience and a positive attitude. Zeenath has effective _____ skills. A. intuitive B. visionary C. human D. conceptual
C. human
Valerie works directly with her subordinates. She allocates work to her team members and sets deadlines and targets for each member. She also conducts performance appraisal for her team members. Valerie is most likely to belong to _____. A. top management B. first-line management C. middle management D. strategic management
C. middle management
Consumers can choose from hundreds of different kinds and producers of cheese, each with a slightly different flavor and texture. This type of market structure is known as _____. A. pure competition B. a monopoly C. monopolistic competition D. an oligopoly
C. monopolistic competition
Innova Corp., a computer hardware firm, is subdivided by its different lines (such as laptops, desktops, mobile devices, printers, and servers). Innova is departmentalized by _____. A. process B. function C. product D. customer
C. product
What does a CFO use in financial planning to determine the expected level of revenue for future periods? A. Revenue projections based on historical performance B. Expenditure rate based on current revenue C. Cash sales forecast D. Sales forecast plus non-sales revenue
D. Sales forecast plus non-sales revenue
Which activity raises ethical issues heightened by the capabilities of data mining? A. Giving customers a choice to store their data or not B. Storing customer data for transactional convenience C. Using customer data for company marketing campaigns D. Selling customer data for external marketing research
D. Selling customer data for external marketing research
Flora Cult Inc., an exporter of flowers across the globe, operates in an industry where there are many sellers and buyers. This makes it difficult for any one single seller or buyer to influence the market price of the flowers. Also, it is difficult for sellers or exporters to differentiate their products from each other. What type of market structure does this illustrate? A. Oligopoly B. Monopoly C. Monopolistic competition D. Pure competition
D. Pure competition
Which type of information system should be accessed by the vice president of sales for a national department store chain who wants to see the previous day's sales receipts? A. An expert information system B. A decision support system C. A process control system D. A transaction processing system
D. A transaction processing system
Which primary driver does management use for an organization's structure? A. Ease of employee interaction B. Hierarchical accountability C. Company business processes D. Achievement of company goals
D. Achievement of company goals
What is one role of a financial manager? A. Preparing tax returns B. Collecting accounting information C. Auditing the firm's accounting books D. Analyzing major investment decisions
D. Analyzing major investment decisions
Which step in the organizing process results in management grouping work activities into units within the organization? A. Delegation B. Centralization C. Decentralization D. Departmentalization
D. Departmentalization
Which manufacturer distribution model is enhanced by the shipping and tracking capabilities of a global package delivery service? A. Wholesale B. Retail C. Drop ship D. Direct
D. Direct
Which marketing strategy is devoted to maintaining continuous bottom line prices rather than relying on short-term price-cutting tactics such as cents-off coupons, rebates, and special sales? A. Skimming pricing B. Penetration pricing C. Cost-based pricing D. Everyday low pricing
D. Everyday low pricing
Which regulatory relationship within the Securities and Exchange Commission (SEC) historically has acted to prohibit the U.S. from adopting the International Financial Reporting Standards (IFRS)? A. The IFRS is too detailed in regards to revenue recognition B. The IFRS requires companies to use "last in, first out" (LIFO). C. U.S. firms are prohibited from using any form of the IFRS D. FASB requires companies to comply with GAAP that differ from IFRS
D. FASB requires companies to comply with GAAP that differ from IFRS
Which manufacturing model uses technology to produce small runs of customized products cost effectively? A. Computer-aided B. Computer-integrated C. Interchangeable D. Flexible
D. Flexible
What is the result of a company increasing the delegation of authority and the span of control? A. Centralized decision making B. Increased number of managers at the upper management level C. Increased number of direct reports per manager D. Increased decision-making authority given to employees
D. Increased decision-making authority given to employees
Which role does the underwriter play in financing business operations when using the capital market to sell securities to the public? A. It insures the value of the security to the investor. B. It determines the qualifications of an investor to securities from the issuer. C. It arranges financing for the issuer to support the initial public offering. D. It assumes the risk of the assessed value of the security from the issuer.
D. It assumes the risk of the assessed value of the security from the issuer.
Why should companies that are conservative investors with liquidity concerns invest their excess cash in money market funds? A. It earns the highest rate of interest. B. It is considered to be cash assets. C. It requires the lowest minimum investment. D. It converts easily into cash.
D. It converts easily into cash.
Which of the following is true of a line organization? A. It links employees from different parts of the organization to work together. B. It places authority jointly in the hands of a group of individuals. C. It is a complex organization structure. D. It is effective in a crisis situation.
D. It is effective in a crisis situation.
A high-tech startup company is launching a marketing campaign for its new social media portal by highlighting how the portal exceeds the connectivity and collaboration capabilities of all other social media sites.Which type of competitive advantage is this company leveraging? A. Brand recognition B. Customer loyalty C. Price D. Product
D. Product
The government of Oaksland, a less-developed country, has been spending the revenue generated from taxes and fees on infrastructural development, health care, and public utilities. Its expenditure has exceeded its revenue. This condition referred to as a _____. A. positive balance of payment B. break-even point C. trade surplus D. budget deficit
D. budget deficit
A graph showing the amount of a product that buyers will purchase at different prices is the _____ curve. A. utility B. production possibility C. supply D. demand
D. demand
Janet is a manager who spends most of her time in day-to-day decisions assigning nonmanagerial employees to specific jobs. Janet is considered a _____ manager. A. mid-level B. top C. technical D. supervisory
D. supervisory
Which two key elements does an effective organization include?Choose 2 answers A. Human interaction B. Compensation C. Safety D. Structure
Human Interaction and Structure
When a manager tries to evaluate the price and the quantity of a product that will be sold, he or she is dealing with microeconomics. True False
True
