Q's for Business Test

The most important source of funds for any new business is:

The owner

Fredrick Herzberg proposed _____.

The two-factor theory

Employees of Stork Industries are encouraged to participate in all aspects of the company. This action of Stork Industries is based on _____.

Theory Z

Which of the following is true of companies employing total quality management (TQM) programs?

They know that TQM requires constant improvements in all areas of the company as well as employee empowerment.

Which of the following is a defining characteristic of continuous manufacturing organizations using a product layout?

They produce a large number of units.

Small business may obtain funding their suppliers in the form of a _____, which means that suppliers allow the business to take possession of the needed goods and services and pay for them at a later date or in installments.

Trade credit

T OR F A drawback of franchising is the need for franchisees to strictly adhere to standardized operations.

True

T OR F An advantage of functional departmentalization is that managers need only the skills that apply to their department's function.

True

T OR F Entrepreneurship is the process of creating and managing a business to achieve desired objectives.

True

T OR F Human relations is the study of individual and group behavior in organizational settings.

True

T OR F Human relations skills are highly important for managers.

True

T OR F In decentralized organizations, lower-level managers have a good understanding of their external environment and need to react quickly to it.

True

T OR F In line-and-staff structure, staff managers do not have direct authority over line managers.

True

T OR F Managers engage in planning, organizing, staffing, directing, and controlling.

True

T OR F Managers who ascribe to Theory Y assume that people like and want to work and that people will seek out responsibilities if provided with the proper conditions.

True

T OR F Retailing attracts entrepreneurs because gaining experience and exposure in retailing is relatively easy.

True

T OR F Top managers focus on strategic decisions to use resources to take advantage of opportunities.

True

T OR F When laid off, a person's attention probably shifts from fulfilling esteem needs to fulfilling physiological and security needs.

True

T OR F A company that uses a fixed-position layout is often called a project organization because it is involved in large, complex projects.

True

T OR F A company with many layers of managers is considered tall.

True

T OR F An important part of good directing is administering awards and recognition.

True

T OR F For most organizations, the ultimate goal of the transformation process is to produce outputs that are worth more than the combined costs of inputs.

True

T OR F Line structure is based on direct lines of authority from the top executive to the lowest level of employee.

True

T OR F Operations management refers to those processes used in making both tangible and intangible products.

True

T OR F Planning involves forecasting events determining the best course of action from a set of options or choices.

True

T OR F Positive rewards for acceptable behavior tend to be more effective in the long run than negative punishments for unacceptable behavior.

True

T OR F Quality is a critical element of operations management.

True

T OR F Taking actions to correct deviations from standards is part of the controlling functions.

True

T OR F Taxes are important consideration when deciding where to locate a production facility.

True

Which of the following is the shortest path to failure in business?

Under Capitalism

____ is best described as the lack of funds to operate a business normally.

Under capitalism

According to managers who adopt McGregor's Theory X:

Workers must be forced to do their jobs

Which of the following is one of the difficulties faced by small business owners?

Worries about employee problems or competition

An airlines company having different departments for frequent travelers and occasional travelers illustrates _____ departmentalization.

Customer

The extent to which authority is delegated throughout an organization determines its:

Degree of centralization

____ is the grouping of jobs into working units usually called units, groups, or divisions.

Departmentalization

If a manager is concerned about doing the work with least cost and waste possible, then his or her primary managerial concern is:

Efficiency

Which of the following is a means of informally expressing an organization's culture?

Employee dress codes

____ is the process of creating and managing a business to achieve desired objectives.

Entrepreneurship

The principal immediate threats to small and mid-size businesses include:

Escalating costs

T OR F A wide span of management is best when a manager and subordinates are not in close proximity.

False

T OR F Accountability is the obligation employees have to carry out assigned tasks.

False

T OR F All organization's, regardless of size, have multiple levels of management.

False

T OR F Crisis management plans are the long-range developed by top management.

False

T OR F Departmentalization is the division of labor into small, specialized tasks and the assignment of single tasks to employees.

False

T OR F Herzberg's motivational factors directly correspond to Maslow's physiological and security needs.

False

T OR F Industries such as wholesaling, services, and manufacturing are unattractive to entrepreneurs because these fields tend to be relatively difficult to enter and require high initial financing.

False

T OR F Managers can run a business with only human and physical resources.

False

T OR F Morale is important to managers, although it doesn't affect profits:

False

T OR F One of the most significant drawbacks of small businesses is their inability to innovate and to bring significant benefits to customers.

False

T OR F The Theory Y style of management focuses on physiological and security needs.

False

T OR F Variations in demand, service requirements, and the intangibility of the product make measuring productivity more difficult for manufacturers.

False

T OR F Communication flows within an organization are always formal.

False

T OR F Flat organizations have narrow spans of management.

False

T OR F Hygiene factors include achievement, recognition, the work itself, responsibility, and advancement.

False

T OR F It is not necessary for a product to satisfy a need or a want.

False

T OR F Management takes place only in business settings.

False

T OR F Managing finished products and packaging them are activities most closely associated with marketing.

False

T OR F Service businesses cannot incorporate quality standards.

False

T OR F Service providers are generally less labor-intensive because of the high degree of customization.

False

T OR F The Hawthorne Studies earned their name because they were conducted by Mr. Hawthorne.

False

T OR F The Hawthorne Studies found that money was the primary motivator of employees.

False

According to the classical theory of motivation, which of the following would motivate employees to work hard?

Financial incentives

A license to sell another's products or to use another's name in business, or both is called a ___.

Franchise

Which of the following traits will help entrepreneurs succeed?

Frugality

High morale contributes to _____.

High returns to stakeholders.

Over a coffee table discussion, two coworkers were casually discussing how the new performance incentive policy would affect the quality of their work. This is an example of ____.

Informal communication

Which of the following is an advantage of job specialization?

It enables workers to perform their work more quickly and efficiently.

Which of the following is a primary function of an organizational chart?

It is a visual display of the organizational structure.

Which of the following best describes bartering?

It is the practice of small businesses trading their own products for the goods and services offered by other businesses.

Which of the following is an advantage of standardization?

It speeds up production.

Which of the following is a flexible scheduling strategy?

Job Sharing

Which of the following is considered as one the major causes of small-business failure?

Lack of funds to operate the business

Which of the following is an accurate description of the difference between manufacturers and service providers?

Manufacturers can separate the production of a product from its actual use, whereas the actual performance of a service typically occurs at the point of consumption.

The specific operations of an organization, plant, division, or department would most typically involve ____ of the company.

Middle management

Carrie starts her own catering business. She creates a website for her business and mentions the fundamental purpose and basic philosophy of her business on the website. This declaration can be regarded as the ___ of her business.

Mission

If an employee's primary function in an organization is transforming resources into goods and services, then he or she is involved in:

Operations management

Low morale is likely to result in ____.

Absenteeism

According to Hersberg's two factor theory, the presence of which of the following factors is likely to motivate employees though their absence may not result in dissatisfaction?

Achievement

Which of the following statements is true of authentic leaders?

Authentic leaders are identified by the way in which they conduct themselves with stakeholders.

One of the major reasons people want to own and operate their own business is to: _____.

Be their own boss

A precise statement of the rationale for a business and a step-by-step explanation of how it will achieve its goals is known as a(n) ___ .

Business plan

Compared to service providers, manufacturers are generally more:

Capital-intensive

When an entrepreneur takes out a loan from a bank, the bank will require him or her to put up ____, a financial interest in the property or fixtures of the business, to guarantee payment of the loan.

Collateral

When Betsy informed her supervisor that the furniture assemblers at their manufacturing plant were using 20 percent more raw materials in the current month when compared to the preceding months, she was involved the management function of:

Controlling

____ refers to a firm's shared values, beliefs, traditions, philosophies, rules, and role models for behavior.

Organizational culture

The output of service providers must be consumed immediately, and only a few services can be saved, stored, resold, or returned. Which characteristic feature of services does this best illustrate?

Perish ability of outputs

Identify the management function in which top managers in an organization spend most of their time.

Planning

Melanie is one of the senior managers in consumer electronics department of a large company. She is part of a team that determines the objectives of the department based on futures trends in the industry and decides how to accomplish them. Melanie is involved in the management function of:

Planning

Quality control refers to the:

Processes an organization uses to maintain its established quality standards.

A company involved in large, complex tasks such as construction or exploration and which uses a fixed-position layout is called a(n):

Project organization

____ are often the Small Business Association's principal means of providing direct management assistance to small businesses and entrepreneurs.

Small Business Development Centers

According to Maslow's hierarchy of needs, the need for love, companionship, and friendship-the desire for acceptance by others is a part of the _____.

Social needs

_____ is the division of labor into small specific tasks and the assignment of employees to do a single task.

Specialization

Maria and Harold have just finished interviewing four candidates for a job position in Jackson Office Supplies Inc., a large company based in Houston. In which of the following management functions are Maria and Harold involved?

Staffing

____, a type of plan for meeting objectives, establish the long-range objectives and the overall course of action by which a firm fulfills its mission.

Strategic plans

A narrow span of management is appropriate when:

Superiors and subordinates are not in close proximity.

Which of the following theories is associated with the piece-rate system?

The classical theory of motivation

Which of the following is a characteristic feature of service businesses?

The degree of variation of inputs and outputs is high.

Which of the following statements is true of tactical plans?

They allow a firm to react to changes in the environment.