Chapter 3

There are costs to firms for their illegal and even unethical behaviors. Which of the following is seen as the most damaging and costly to these businesses? A) Employee Turnover B) Government fines C) Corrective actions D) Government oversight

A) Employee Turnover

Virtual instant global entrepreneurship refers to: A) The transformation of a high-growth venture into a small business. B) A person becoming an owner by inheriting or getting a stake in a family business. C) The way that newly created goods, services, or firms hurt existing goods, services, or firms. D) A process that uses the Internet to quickly create businesses with a worldwide reach.

D) A process that uses the Internet to quickly create businesses with a worldwide reach.

Which of the following is the most frequently occurring element of the BRIE model? A) Intention B) Boundary C) Exchange D) Resources

A) Intention

Which of the following is typically a part of a firm's general environment? A) The politics and laws of a country B) The media of a country C) The firm's board of directors D) The firm's corporate allies

A) The politics and laws of a country

Effectuation refers to: A) The degree of attention a target market pays to an idea or organization. B) An approach used to create alternatives in uncertain environments. C) Transforming a high-growth venture into a small business. D) A process of a person becoming an owner by inheriting or getting a stake in a family business.

B) An approach used to create alternatives in uncertain environments.

A way to minimize the need for high-pressure ethical decision making situations in business is by: A) Getting down to every detail of what to permit or prohibit in positively managing a firm's external relations. B) Using lapses in external relations as learning experiences for the rest of the firm by talking openly about the issues. C) Excluding the lessons of legitimacy, social networking, crisis management, sustainability, and ethical decision making from everyday activities. D) Getting emotional when counseling around external relations issues and by keeping the consequences of external relations lapses inconsistent.

B) Using lapses in external relations as learning experiences for the rest of the firm by talking openly about the issues.

Which of the following statements about certification with regard to women or minority-owned small business is true? A) Most corporate certification programs require a business to be in operation at least five years. B) Certification is for every women or minority-owned small business. C) For those businesses that qualify, certification provides a ready means of access to opportunity and to networks of businesses and government agencies. D) For corporations, certification is handled by organizations that are affiliated with the government or big business.

C) For those businesses that qualify, certification provides a ready means of access to opportunity and to networks of businesses and government agencies.

Social capital is the major component of what accountants call _____, and it can be found on a business's balance sheet. A) Doubtful debt B) Bequest C) Goodwill D) Excise duty

C) Goodwill

Which of the following is true of a small business? A) Its preferred funding source is other people's money. B) It sells more when it is facing bankruptcy. C) It considers sales as more important than marketing. D) It focuses more on effectiveness than on efficiency.

C) It considers sales as more important than marketing.

Which of the following is best avoided in handling a business crisis? A) Appointing an outside professional, such as a lawyer, as a firm's spokesperson B) Communicating facts to the employees and customers C) Mixing crisis management with the everyday management of a firm D) Admitting that the company is in trouble as quickly as possible

C) Mixing crisis management with the everyday management of a firm

Which of the following statements is true of legitimacy indicators? A) A small business cannot survive without incorporating all the 30 characteristics of the three types of legitimacy indicators. B) Part of legitimacy and building trust for a firm comes from changing the legitimacy characteristics frequently. C) It is easy for businesses to incorporate all the elements of the different types of legitimacy indicators. D) Repeating one legitimacy characteristic daily does more to build social capital than changing the legitimacy characteristics.

D) Repeating one legitimacy characteristic daily does more to build social capital than changing the legitimacy characteristics.