Business 101 midterm

Steve Jobs and Stephen Wozniak, banners of Apple Computer Inc.., creative free spirited individuals who decided that being cooperate underlings was not what they wanted from a career. They had an innovative idea for a product and desire to create their own business based on this idea. All of the following are factors that could have led them to go into business except

The low risk and high reward inherent in entrepreneurship

As a farmer, Charles Forsythe is familiar with the economics of perfect competition. How is the price at which he sells his corn determined?

The price is determined by combining the actions of all buyers and all sellers together.

Which of the following would least likely be stated in the articles of partnership?

What products the company will not sell

Globalization represents a huge opportunity for

all countries rich or poor

In the state in which it is incorporated, a business is known as a(n)

domestic corporation

A small business is all of the following except

dominant in its field

When compromise to partnership and cooperation's sole proprietorship account for ____ percent of total annual sales.

4

To qualify as a small business, a manufacturing plant can employ no more than ____ people.

500

Which of the following is necessary for starting a sole proprietorship ?

A contract

What is the most popular course offered by the SBA?

A general course that surveys eight to ten areas of business management

The Federal Reserve ______ uses when it lowers the interest rate charged to banks on short-term loans.

monetary policy

A voluntary association of two or more people acting as co-owners of a business is known as

partnership

Kai promised to repair Krystal's car on Thursday. After picking up the necessary part at the junkyard he discovered he could not do the job after all and that the junkyard would not buy back the part. Krystal does not know about these developments. However, she thinks Kai will be finished with her car sometime today. What should Kai do?

Call Krystal to inform her of the problem and recommend reputable repair shop.

A new small business underwater wildlife has open to sell tours of underwater sites around the country and in South America. However money has to be paid upfront by the underwater staff to book hotels and other travel arrangements before his clients have paid for the tours. That means on the water is facing a potential

Cash-flow problem

How might a sole proprietorship have a possible tax advantage?

It does not pay special state and federal taxes that corporations pay

Suppose a manager at the post it brand has recently become aware that employees are taking office supplies home and taking longer coffee and lunch breaks than the personnel policy allows. The manager finds these are widespread practices and wants to solve the problem. The best way to do this would be to

Make the corporate culture encourage more ethical behavior

According to Census Bureau and Federal Reserve surveys, about 50 percent of all new businesses begin with less than ____ in total capital.

$30,000

What must a monopoly, such as a public utility, account for when setting its prices?

A monopoly must consider customer demand, and then set prices at the most profitable level.

Mercedes-Benz, which is charted as a Corporation in Germany but conducts much of its business in the United States is known as a _____ in the United States.

Alien corporation

Early government regulations prior to 1920 that affected American business include all of the following except the

Americans with disabilities act

A contract between a business and state recognizing the business as an artificial person is known as the

Articles of incorporation

In the early 1980s, Craig Anderson, a corporate finance manager, was faced with which of the following problems?

High inflation rates

When was GATT first established?

At the end of World War II

Mars Inc. maaker of M&Ms and other candy is 100 percent owned by the Mars family and is therefore referred to as

Closed corporation

government. He does not like his job but is not allowed other options. Tim must purchase necessities for his family at fixed prices. The country Tim lives Tim Hughes works at an institutional bakery and is paid a wage dictated by the in can be described as a ________ econonmy.

Command

In the first three decades of the 20th century working conditions were horrible and dangerous in abuses were common. Most people all the time believed these abuses would be rectified by

Competition and interaction in the marketplace

The form of business organization that comprises about 18 percent of all businesses in the United States is the

Corporation

The most effective form of business organization for raising capital is the

Corporation

IntelExperts is code of ethics and shared values to provide all of the following benefits except

Describe what to do in every ethical situation

Walmart is incorporated in Arkansas, the state of its origins and headquarters. Within Arkansas, Walmart is classified as an ___ corporation.

Domestic

China is selling school supplies in the United States for very low prices even lower than the prevailing prices in China, and thus making it extremely difficult for American Manufacturers to compete. This is referred to as

Dumping

Lucas has been saving his excess funds for several years and has contemplated entering a partnership with a friend from college. Lucas hesitates because he knows that it is ___ to invest money in a partnership and ____ to get the money back out.

Easy; difficult

Jonathan serves on Foot Locker's board of directors. How did Jonathan get position?

He was elected by the company's stockholders

An organization of nations form to promote the free movement of resources and products Among its members and to create comment economic policies is called a

Economic community

The United States joined with Mexico and Canada to promote the movement of resources and products it formed a

Economic community

When the U.S Government will not be allowed meat from other countries to be marketed in the United States it is imposing

Embargo

The Johnson Spring Coal Mine man recently discovered that the man was contaminating the local drinking water. Cleaning up the mine and the surrounding areas would probably bankrupt the mine, causing the loss of hundreds of local jobs, but doing nothing would endanger the health of the community. The man face is a serious ____ decision.

Ethical

Robert Mullins is applying for a mortgage to purchase his first home. His credit rating is mediocreDue to several late payments on his credit cards and car loan. He is upset because his friend Mark was offered an interest rate 3% less then what Robert was offered by the same mortgage company. This mortgage companies actions were

Ethical-this is just a part of doing business because credit history is an important indicator of future payments

One example of an economic community is the organizations started by France Germany Belgium Italy the Netherlands and Luxembourg. This organization is known as the

Euro economic alliance

In a socialist economy, key industries owned by government include all except

Food production

Which of the following is not a feature of laissez faire capitalism?

Guaranteed income

All of the following are reasons people go into business except

Guaranteed return on investment

Which of the following is a potential withdrawal of licensing?

If quality is compromised, it may reflect poorly on the company providing the license.

The United States which is to import no more than 100 million tons of sugar from India in any given year. The type of import restriction it should impose is a

Import Quota

A limit on the amount of particular good that may be brought into a country during a giving period of time is called a

Import quota

New ways to do a job with less effort and a lower cost is the basic principle characterizing the

Increases in productivity for the past two hundred years

Because it has not been around long enough to establish itself the Russian automobile industry could be classified as a

Infant industry

Amy starts a small quilting and embroidery business. She purchases a Technologically advanced quilting machine in an embroidery machine for a combined $25,000. Her monthly payment on the equipment are $500 but she has only one client at this time. Amy is facing a potential

Inventory flow problems

caveat emptor

Is a Latin phrase meaning "let the buyer beware"

Large firms generally buy parts and assemblies from smaller firms because

It is less expensive than making their own

What is the significance of the name preferred stock?

Its claims on dividends are paid before those of common stock.

William Welsh, a former Air Force pilot, decides to operate a helicopier tour company to provide purchases the necessary land, facilities, advertising, and five helicopters for his business. What important factor of production has he overlooked in creating his business?

Labor

MillersCoorsAllows a Canadian firm to use his name formula and brands in return for a royalty. This is known ass

Licensing

Refer to satellite communications. Steven is operating in a _____ because he has the opportunity to decide what to produce

Market economy

Which of the following examples least represents the definition of social responsibility?

Military members pledge a portion of their salary to the United Way

All of the following are material resources for Honda motor company except

Money

Suppose the country of Peru wanted to join GATT and thus we treated the same as other GATT members. What GATT principal is Peru interested in receiving?

Most favored nation status

Harry is a business person who works for a successful and a mired fortune 500 company. About how often is Harry likely to encounter ethical issues in the workplace?

On a daily basis

The relationship between sales and profits can be written as

Sales revenue - expenses = profit

Anyone with the money can purchase shares of the PepsiCo's stock. This makes PepsiCo a ____ corporation.

Open

Refer to Echo air company. Since the company created itscodes of conduct employees have limited ____ or amount of freedom to perform an unethical act.

Opportunity

What are the three sets of factors that influence the standards of behavior in an organization?

Opportunity, individual factors, social factors

Taking credit for others ideas or work or not meeting ones commitments in a mutual agreement or ethical issues concerning

Organizational relationships

Reler to Home Inapirations. Mary noticed that when sales were up, the ecoaomy was in a

Peak period

What is the main advantage of a small business that helps retain effective employees who can earn more and a larger firm?

Personal relationships with employees

Daniel's business constructs storage sheds for a new housing developments as requested by the builders. Daniel's business would best be classified as a

Production business

The main reason there are fewer production industries than distribution or service industries is that

Production industries needs large initial investment.

Suppose France imposes a tax on agricultural products from the United States to help its own farmers. This describes a

Protective tariff

A whistle blower is a person who

Reports illegal or unethical conduct within his or her organization

Refer to Manna's coffee. If Eun-Sang were Caucasian in the company employees were mostly Asian the way she was treated would be referred to as

Reverse discrimination

Luis Fisher, I recently retired corporate executive, he is becoming restless in his new role and would like to make this transition smoother by participating in the business community in some limited manner.St. Louis is financially secure in primarily interested in some sort of volunteer work he should consider becoming involved with which of the following SBA programs? .

SCORE

Mandy Bush decide to start residential landscaping business. How could this business most likely be classified?

Service business

Your friend Linda started a graphic design firm about a year ago. The business has done well but it needs a lot more equipment computers and employees to continue expanding. Linda does not see any problem because she thinks she can easily get all the money she will need from her local bank. What advice might you give her?

She should consider alternative sources of financing because banks provide only about one-fourth of the total capital to small businesses.

The economic model of social responsibility was developed in a period when the primary concerns of firms was

Short run profits and survival

Fatima's cleaning business has several customers but is not dominant in it's field. This is an example of a ____ business.

Small

Group of senior and graduate students in business administration who provide management counseling to small businesses is known as a

Small-business institute

At Park Incorporated, employees are allowed one-hour lunches but it has become common that most stroll back 15 minutes late every day. The factory affecting the ethical behavior of Park's employees is

Social

Mark Zuckerberg's internet.org program that helps bring Internet access to underserved communities in several parts of the world is an example of

Social responsibility

Referred to echo air company. The principles that EAC chose to pride itself on show that the company has

Social responsibility

The nationalization of key industries in countries such as sweden and norway is indicative of a ___ economy.

Socialist

Sandy is tired of her boss as well as cooperate Americans in general. She decided she would like to start a business where no one tells her what to do and she can always make the decisions. The best form of business for Sandy is a

Sole Proprietorship

Referred to Mc-Queen chicken. Which of the following would not be an advantage of a finance?

Success will cause another outlet to be opened nearby.

Several European countries have banded together to reduce the trade barriers between them and encourage trading among themselves. This is known as

The European Union

Taiwanese Manufacturers are dumping toys in Germany. What will happen to German Toya manufacturers if the German government allows this dumping to continue?

They will be put out of business because I cannot compete with the prices.

When medical research indicated that a high-fiber diet might help reduce one's risk of colon cancer a few producers of fiber cereal suggested in their advertisements that you eat fiber cereal you will not get cancer. This is an example of

Unethical communications

The world trade organization was created by the

Uruguay round

Which of the following would not be included in the gross domestic product of the United States?

Value of McDonald's sales for their Tokyo locations

If the United States and Japan can't settle their trade dispute on his own they probably should settle them through the

WTO

The following statement answers which major question that a business plan should address? This business will serve over 200 customers by the end of the year and employees seven full-time employees

What are the goals for the business?

Capital or capital goods as recognized by economists would include all of the following except

crude oil.

Arguments for imposing trade restrictions include

equalizing a nation's balance of payments

Suppose a set of English bone china costing £1,000 costs $3,000 in the United States. After devaluation, the set of china costs $1,000. This change

makes the china more attractive to foreign purchasers.

All of the following would typically be considered consumer products except a

high-powered drill pres

Which of the following is not an advantage of a sole proprietorship?

it has unlimited liability

In the mid-1970s, American auto manufacturers peoduced big gas-guzzling cars and tried to sell them to consumers who needed fuel-efficient transportation. This happened because manufacturers

lost sight of consumers' needs.

Mary works for her father in a family-owned business called Home Inspirations, a bedding company that has been in operation since the I800s When her father retires, Mary plan on taking over the Mary is aware of many unemployment and business. high total income, sales are great. However, any other things about the company that she likes, and a few not so good. time, sales are things that she does not. She has particularly noted that when the economy has low every day. Mary is thinking about streamlining the production process so that individals Currently, all of the bedding items are created in one place and everyone works on various tasks would be for only one task. She believes products available responsible in the market are very similar in nature and satisfy the that if production would increase, she could sell her products at a lower price and increase revenue. She knows that most bedding need. However, if she were able to lower prices, this might give her company the competitive advantage money in differentiating her same products by providing unique features, building the brand name, and offering services such as free delivery. She that it needs. She would then be able to invest is also considering selling her products on the Internet. Mary knows that her father does oot like change very mach, but she feels these changes are important for the future of the company Refer to Home lInspirations. Mary's goal of offering products with unique features and special services is called

product differentiation

Price Waterhouse, a large accounting firm would be most properly classified in the ___ industry, whereas a grocery store such as Kroger's would be included in the ____ industry.

service;distribution

Monopolistic competition is a market situation in which

similar but not identical products are available.

All of the following are advantages of the partnership form of organization except

unlimited liability