Business FInal

Which of the following are correct with regards to a free-market economy?

An economic system in which economic decisions are made by the market Another name for capitalism.

What is the rule of indemnity?

An insured person or organization can't collect more than the actual loss from an insurable risk.

An independent entity whose purpose it is to oversee cross-border trade issues and global business practices is called the .

Blank 1: World Blank 2: Trade Blank 3: Organization

Which set of ethics codes emphasizes preventing unlawful behavior by increasing control and penalizing wrongdoers?

Compliance-based ethics codes

Identify which of the following would classify as Internet plagiarism.

Copying full article content from Internet sites and presenting it as your own Cutting and pasting information from a website without giving proper credit Buying research papers online and submitting them as your own

Which of the following is a goal of enterprise risk management?

Defining which risks the program will manage

True or false: Devaluation is the value of one nation's currency relative to the currencies of other countries.

False

True or false: If producers, consumers, or workers with similar needs pool their resources for mutual gain, they have created a franchise.

False

What motivated the unethical behavior of real estate agents, lenders, and borrowers that led to the financial crisis of 2008?

Greed

What is the total value of final goods and services produced in a country in a given year called?

Gross domestic product

What is the global strategy in which a firm allows a foreign company to produce its product in exchange for a fee?

Licensing

Which of the following represent examples of how corporations set positive standards of ethical behavior?

Reevaluating its ethics codes based on the input of its customers. Periodically asking every employee to evaluate the company's ethics performance.

What are the two kinds of risk?

Speculative and pure risk

What kind of risk is associated with an entrepreneur's chance to make a profit?

Speculative risk

Equipment such as phones, fax machines, and computers are all examples of which of the elements of the business environment?

Technological

Which of the following are important reasons to do business globally?

There are more people and countries in the world markets There are many potential customers in other countries

How are taxes used to influence the economy?

They are used to stabilize the economy. High taxes draw the money away from the private sector. Low taxes increase the profits a small business can earn.

Which of the following are reasons a business should be managed ethically?

To avoid lawsuits To attract customers To maintain a good reputation

Which of the following are functions of the World Trade Organization?

To oversee cross-border trade issues To mediate trade disputes among nations

What type of insurance guarantees payment of wages, medical care, and rehabilitation services to employees who are injured on the job?

Workers' compensation insurance

Among the benefits of exporting for U.S. businesses are:

a boost to the U.S. economy

The global environment of business affects all of the other elements such as the Social, Technological, and Economic environments because:

a change in one country, such as a recession, affects others due to globalization changes in technology and distribution have led to interdependence between trading nations changes in communication systems make it possible to know what is happening around the world instantly

When a country has a monopoly on producing a specific product or is able to produce it more efficiently than all other countries it is said to have a(n) advantage.

absolute

The advantage that exists when a country has a monopoly on producing a specific product is called:

absolute advantage

A(n) ______ is where one company purchases the property and obligations of another.

acquisition

Many corporate executives reported that they use social media to communicate their socially responsible activities to customers because it:

allows them to connect directly with customers reaches broad and diverse groups allows them to reach specific groups more directly

In a free market, the prices of products exchanged in the market:

are negotiated by buyers and sellers

Many people do not like working for someone, so being your own is an advantage of sole proprietorships.

boss

Many businesses believe that they should have an influential and important role in:

building communities

The periodic rises and falls that occur in economies over time are called _____ ______.

business cycle

The idea that some basic businesses such as steel mills, coal mines and utilities, should be owned and controlled by the government is indicative of a economic system.

command

A(n) , or trading bloc, is a regional group of countries with a common external tariff, no internal tariffs, and coordinated laws to facilitate exchange among members.

common market

Corporate social responsibility is based on a

concern for the welfare of society

A foreign country's production of private-label goods to which a domestic company then attaches its brand name or trade mark is called:

contract manufacturing

involves a foreign company producing private-label goods to which a domestic company then attaches its own brand name or trademark. (Enter one word in each blank.)

contract manufacturing

The statement by Patagonia that "A love of wild and beautiful places demands participation in the fight to save them, and to help reverse the steep decline in the overall environmental health of our planet" is an example of:

corporate policy

The dimension of social responsibility, which includes certain aspects such as producing low-emission vehicles, is called:

corporate responsibility

Fiscal policy is the government's efforts to keep the economy stable by:

decreasing taxes increasing taxes increasing or decreasing government spending

The statistical description of a population using characteristics such as age, gender, and income is _______ .

demographic

Export Assistance Centers work with small and medium-sized businesses who are hesitant to do:

direct exporting

Freedom of ownership is part of the and environment.

economic legal

The study of how resources are distributed for production of goods and services within a social system is called _______ .

economics

A corporation is a legal with authority to act and have liability separate from its owners.

entity

LLCs do have to submit articles of organization and an operating agreement, but do not have to:

file written resolutions hold annual meetings keep minutes

is a contractual agreement whereby someone with a good idea for a business sells others the rights to use a business name and sell a product or service in a given territory in a specified manner. (Enter one word in the blank.)

franchising

trade is the movement of goods and services among nations without political or economic barriers.

free

Buyers and sellers negotiate prices for goods and services through supply and demand in a(n) _____ ______ economy.

free market

Buyers and sellers negotiate prices for goods and services through supply and demand in a(n) economy.

free market

The definition of ______ ______ states: the movement of goods and services among nations without economic or political barriers.

free trade

An economic system in which the market largely determines what products get produced, who gets them, and how the economy grows is a ______ economy.

free-market

Importing, exporting, licensing, franchising, contract manufacturing, international joint ventures, strategic alliances, and foreign direct investment are all ways to become involved with trade.

global

The _______ environment of business impacts all other elements of the business environment because of technological changes in communication and distribution systems. (Enter one word in the blank.)

global

The environment of business impacts all other elements of the business environment because of technological changes in communication and distribution systems. (Enter one word in the blank.)

global

A small business owner wants to increase sales and cut production costs, and decides that importing materials and exporting his product are two ways to accomplish this. This small business owner is engaging in:

global trade

Responsible business behavior depends on the responsible behavior of each ______ in the business world.

individual

In socialism:

individuals own some smaller businesses and property government owns and operates some basic industries such as steel mills, utilities, or transportation

Those who oppose corporate social responsibility believe that

it is using investors' money in ways they did not intend

The importance of business is not new, but the need to manage it like any other asset is.

knowledge

An S corporation has the liability protections of a corporation but is taxed:

like a partnership or sole proprietorship

A company that has socially responsible human resources management is

likely to perform better financially

Don wanted to incorporate his business and liked the attributes of an S-corporation, however, he did not feel the eligibility requirements would work for his purposes. He is likely to choose to form a(n) company.

limited liability

Franchises offer those starting a business the advantage of a recognized name, management assistance, and:

lower failure rates

The result of two firms joining to form one is called a(n):

merger

A common market, also called a trading bloc, is a regional group of countries with:

no internal tariffs a common external tariff

The definition of ______ states: the process whereby one firm contracts with other companies, often in different countries, to do some or all of its functions.

outsourcing

When a company contracts with another company, often in a different country, to perform some or all of its functions it is called:

outsourcing

is the process whereby a firm contracts with other companies, often in other countries, to do some or all of its functions.

outsourcing

A key advantage of a home-based franchise is low costs, which can be ongoing. These are the costs associated with rent, utilities, and other fixed costs.

overhead

A foreign subsidiary is a company owned in a foreign country by another company called the:

parent company

The United States has experienced economic growth and increased ________ since the 1800s as a result of advances in technology.

productivity

A business tries to earn a profit by providing _______ and ________ that satisfy people's needs and wants.

products, services

The practice of setting money aside to cover routine claims and major losses is called:

self-insurance

Stockholders are from the managers and employees of the firm because they are not actively involved in the operations of the firm.

separate

A type of insurance company that is owned by stockholders is called a(n):

stock insurance company

In an economic and political system called communism:

the government owns almost all the factors of production

The global environment affects all of the other environmental influences such as the economic, legal, and social environments because:

the increase in free trade among nations and technological changes have created globalization and increased competition

What is the definition of trade protectionism?

the use of government regulations to limit the import of goods and services

A risk that no insurance company will cover is called:

uninsurable risk

Home-based businesses may need a rider or endorsement added to a homeowners policy because:

visitors to the office or shop could have an accident inventories may exceed the limits on an ordinary homeowners policy they may need more coverage for equipment

______ is the study of how society chooses to employ resources to produce goods and services and distribute them for consumption among various competing groups and individuals.

Economics

Which of the following is NOT an example of risk reduction?

Engaging in a hazardous activity

What are the purposes of nonprofit organizations?

Filling a societal need Filling an educational need

A widely debated issue of the early 1990s was the ratification of the __ __ __ __ Agreement, which created a free-trade area among the United States, Mexico, and Canada.

North American Free Trade

Which of the following is a type of insurance that state and federal agencies provide?

Social Security Federal Crop Insurance Unemployment compensation

Small and medium-sized firms are often better prepared to leap into global markets because they:

can react quickly to opportunities

Businesses that listen carefully to their customers, believe their "customers are king" and adjust their products and services to meet customer needs are ______.

customer-driven

When implementing a new ethics program, businesses must also communicate the changes to outside parties such as:

customers

The is the value of one nation's currency relative to the currencies of other countries.

exchange rate

The value of one nation's currency relative to currencies of other countries is the:

exchange rate

A company in another country that is owned by a U.S. company would be an example of a:

foreign subsidiary

An advantage of starting an online franchise is that:

franchisees pay only a set monthly fee online franchisees can compete in world markets no upfront fee may be required

A partnership where all owners share in operating the business and in assuming unlimited liability for the business's debts is a:

general partnership

The origin of Starbucks in Italian coffee shops is an example of the benefits of products from other countries.

importing

Bringing products and services to consumers in the U.S. that were previously available only in other countries is an advantage of . (Enter one word in the blank.)

imports

The balance of trade is the total value of a nation's compared to its over a particular period of time.

imports exports

A(n) is a written contract between the insured and an insurance company that promises to pay for all or part of a loss.

insurance policy

A(n) ethics code creates an environment which supports ethically sound behavior by stating an organization's guiding values, shared responsibilities, and accountability.

integrity based

Written ethics codes can be categorized as

integrity-based compliance- based

A(n) is an organization-wide network that is closed to public access and uses Internet-type technology.

intranet

A(n) ________ economy is made up of the elements of more than one economic system, with some industries owned by the government and some privately owned.

mixed

A(n) economy is made up of the elements of more than one economic system, with some industries owned by the government and some privately owned.

mixed

The Federal Reserve Bank manages the money supply and interest rates in an effort to balance the economy. This is referred to as policy.

monetary

When implementing an ethics code, it is important to share it with all because pressure to act unethically often comes from the outside.

outsiders

Unlimited liability as it relates to sole proprietorships is the risk of loss of assets beyond the assets of the business.

personal

Corporate is the dimension of social responsibility that refers to a position a firm takes or statement it makes on social and political issues.

policy

Trade is the use of government regulations to limit the import of goods and services such as import tariffs and quotas.

protectionism

When there is a threat of loss with no chance of making a profit it is called:

pure risk

risk involves a chance of either profit or loss.

speculative

Groups that have a strong interest in the success and outcomes of a business, such as employees, neighbors, or government regulators, are called ______ .

stakeholders

A company situated in a foreign country that is owned by a parent company located in a different country, is a foreign .

subsidiary

Gathering leads on a company website, selling products and keeping up to date on news via email, and chat rooms all serve as examples of using to assist franchisees and customers.

technology

Productivity in the U.S. has risen because:

technology has improved productivity by reducing the number of workers needed computers have increased the speed of production

Many franchises are expanding internationally because:

there are large new markets available

One of the most notable advantages of an online franchise is

there is no brick-and-mortar real estate cost.

An entrepreneur risks ______ and _______ to start and manage a business.

time, money

A merger that joins two companies involved in different but related levels of an industry is a(n) ______ merger.

vertical

In the United States, many employees report that they are unethical at work because they:

violate safety standards goof off

A weak transportation infrastructure results in a(n) barrier to global business.

environmental

An organization's managers instill corporate values and in employees by the examples they set.

ethics

People learn their organizational from observing the standards, values, and behaviors of leaders and other employees.

ethics

An important factor in enforcing ethics codes is selecting a(n) .

ethics officer

The definition of ______ states: an attitude that your own culture is superior to other cultures.

ethnocentricity

Since the 1800s the United States has:

experienced strong economic growth

True or false: Social responsibility and ethical problems exist primarily in the U.S. because we have more laws about those problems.

false

Ethical problems such as influence peddling and bribery:

occur in many countries

A systematic evaluation of an organization's progress toward implementing socially responsible and responsive programs is called:

a social audit

Corporate social responsibility is when businesses are concerned

about being fair and honest with their stakeholders for the welfare of society as a whole

What are some of the disadvantages of a corporation?

Cost of forming a corporation Double taxation

Well-defined goals such as defining the risks a program will manage, what risk management processes are required, and how risk management efforts will be coordinated are all part of a(n) program.

ERM

True or false: Licensing is a contractual agreement whereby someone with a good idea for a business sells others the rights to use the business name to sell a product or service in a given territory in a specified manner.

False

The total value of final goods and services produced in a country in a given year is called:

GDP

The calculation of premiums for disability insurance consider which of the following?

Income Age Occupation

Which of the following are likely benefits to suppliers of exporting?

Increased number of potential customers Increased sales and revenues

Compliance-based ethics codes focus on:

Increasing control, penalizing wrong-doers

Problems created by differences between countries' antitrust rules, labor laws, patents, copyrights, taxes, product liability, and child labor laws relate to which forces in the global business environment?

Legal and regulatory forces

Which of the following are considered major hurdles to successful global trade?

Legal and regulatory forces Economic and financial forces

Revenue generated by Ford's factory in Mexico is included in the gross domestic product (GDP) of ___________ .

Mexico

Which of the following are true regarding the process of forming a corporation.

The bylaws of the corporation describe how the firm is to be operated The articles of incorporation must be filed in the state in which the company will be incorporated

What is included in the definition of risk?

The chance of loss and the amount of possible loss The degree of probability of loss

Which of the following are methods that companies use to implement ethical standards? (Check all that apply.)

The enforcement of controls The education and training of employees

True or false: The main advantage of a sole proprietorship is ease of start up.

True

The definition of ______ advantage is the advantage that exists when a country has a monopoly on producing or is able to produce something more efficiently than all other countries.

absolute

The , also known as Obamacare, has been challenged in the federal court system.

affordable care act

Some drug companies have stopped manufacturing vaccines due to the threat of lawsuits. This risk strategy is done in an effort to:

avoid risk

The total value of a nation's exports compared to its imports measured over a particular period is the definition of:

balance of trade

The concern businesses have for the welfare of society, not just for their owners is:

based on a commitment to integrity and respect corporate social responsibility

In a free market system, decisions about what and how much is produced are made by:

buyers and sellers negotiating prices

When businesspeople and the market largely determine what goods and services to produce, a ______ economy exists.

capitalist

Elements of an integrity-based ethics code include

clear guiding values; trust and shared accountability

The actions of a fellow franchisee will affect your franchise. This is known as the .

coattail effect

- ethics codes emphasize preventing unlawful behavior by increasing control and penalizing wrongdoers. - ethics codes define an organization's guiding values, create an environment that supports ethically sound behavior, and stresses shared accountability.

compliance based integrity based

The dimension of social responsibility known as social responsibility includes everything from hiring minority workers to making safe products, minimizing pollution, using energy wisely, and providing a safe work environment.

corporate

Businesses who could be sued if they are hacked are able to buy insurance.

cyber risk

Advantages of doing business globally include:

finding financing for a new business in other countries bringing ideas for businesses in other countries to new markets

One of the most important advantages of the sole proprietor form of ownership is that a business owner:

finds it easier to start and end the business

The right to use a specific business' name and sell its products or services in a given territory is a(n) agreement.

franchise

The mortgage bankers and real estate companies who helped create the financial crisis of 2008 were driven by .

greed

The motives of those involved in unethical behavior that caused the financial crisis in the real estate, banking, and mortgage industries included:

greed the wish to inflate their own earnings

Tax-deferred savings accounts that are linked to low cost, high-deductible health insurance policies are called:

health savings accounts

A company's effectiveness and financial performance are most affected by responsible management.

human resource

The unethical and illegal activity in which investors use private company information to further their own fortunes or those of their family and friends is called:

insider trading

The use of private company information by an employee for personal financial gain is called .

insider trading

A type of risk that a typical insurance company will cover is called a(n):

insurable risk

There are more jobs available today in the service sector of the economy because:

it has the fastest-growing businesses in the economy today

There are more than 7 billion potential customers in 195 countries around the globe. Each country possesses unique materials and skills, and as technology advances, communication barriers are being brought down. Therefore:

it is important to conduct business globally

A business should be managed ethically because

it reduces the likelihood of lawsuits by employees or customers businesses with good reputations attract customers it reduces employee turnover

The definition of __ __ states: a partnership in which two or more companies, often from different countries, join to undertake a major project.

joint venture

The definition of states: a partnership in which two or more companies,often from different countries, join to undertake a major project.

joint venture

When two or more companies, often from different countries, join together to take on a major project it is called a:

joint venture

Government policies that favor businesses are:

keeping interference to a minimum writing laws that support writing enforceable contracts

Legal and regulatory forces can create problems in the global market because:

laws and regulations vary greatly between countries

The definition of states: a global strategy in which a firm allows a foreign company to produce its product in exchange for a fee.

licensing

Mixed economies exist where some allocation of resources is made by the:

market government

About 30 percent of franchises are owned by African Americans, Latinos, Asians, and Native Americans. Franchisors are becoming more focused on recruiting franchisees.

minority

A legal form of business with two or more owners is a(n):

partnership

Termination of a partnership is difficult without a(n) ______ agreement.

partnership

Using information from the internet or other sources without giving credit to the author is:

plagiarism

One way government can promote entrepreneurship is to minimize

regulation

Change is happening so fast that companies have difficulty identifying new like currency fluctuations, profit variability, and hazards of buying and selling on the Internet.

risk

The chance of loss, the degree of the probability of loss, and the amount of possible loss is referred to as:

risk

The fastest-growing businesses today are in the sector of the economy.

service

If the statement "ethics is caught more than it is taught" is true, then management facilitates this by:

setting a good example

The United States has experienced strong economic growth and increased productivity:

since the 1800s

The firms often better prepared to leap into global markets and react quickly to opportunities are:

small and medium businesses

Export Assistance Centers provide hands-on exporting assistance and trade-finance support for and -sized businesses.

small medium

A systematic evaluation of a company's progress toward implementing socially responsible programs is known as a(n) .

social audit

Many companies believe they have a role in promoting , so they donate to local food banks, promote literacy, and provide computer lessons for inner city children.

social justice

A communication tool many companies use to inform diverse groups of their social responsibility efforts at little cost is

social media

A low cost, efficient way for companies to connect with specific groups and inform them of corporate social responsibility efforts is .

social media

The economic system based on the premise that some, if not most, basic industries should be owned by the government so that profits can be more evenly distributed among the people is called .

socialism

The economic system based on the premise that some, if not most, basic industries should be owned by the government so that profits can be more evenly distributed among the people is called _______ .

socialism

U.S. economist Milton Friedman believed that the only social responsibility of the corporation was to its stockholders. He also believed anything other than that would be considered:

socialism

When some allocation of resources is made by the market and some is made by the government an economy is said to be a(n) economy.

socialist

Corporate social responsibility (CSR) is based on the belief that businesses should be concerned with the welfare of and not only of their owners.

society

When it comes to ethics, sets the standards for moral behavior, that is behavior defined as right or wrong.

society

An advantage of partnerships is a longer rate than sole proprietorships, because they become more disciplined and the business's life is based on all the partners.

survival

The elements of the business environment include the:

technological environment economic and legal environments competitive environment

Global trade with 7.7 billion potential customers is attractive, but the threats to trading globally include

terrorism income inequality rogue states

Challenges for new leaders since the global information-based revolution include:

that the service era is coming to a close learning about world quality standards

is when business data reach managers when the information is needed and still relevant.

timeliness

One government policy that helps to reduce the risks for businesses is:

to pass laws that enable businesspeople to write enforceable contracts

True or false: Corporate Social Responsibility (CSR) and corporate profits can at times go hand in hand.

true

An employee who reported her boss to the SEC for insider trading would be considered a(n) protected by law.

whistleblower

Insiders, such as employees, who report concerns about a company's accounting or auditing practices are called:

whistleblowers

U.S. business people are often accused of ethnocentricity which is a belief that:

your own culture is superior to other cultures