busn 1003 exam 1
Of all forms of business ownership, corporations account for the largest share of both:
sales and profits
The Home Depot supplies all the materials and the labor expertise for Habitat Homes in various regions of the country where the retail giant has a store. Its top management believes that this type of philanthropy better reflects the company's commitment to the community than simple donations to the American Cancer Society and similar national charities. The Home Depot is using the practice of:
strategic giving
A(n) _____ is a tax levied by a nation on imported goods.
subsidy
Besides tariffs, a government can use a number of other tools to restrict trade. Which of the following is NOT a tool aimed at restricting trade?
subsidy (besides tariffs)
The quantity of a product or service that businesses will make available at various prices is called:
supply
Multinational oil companies such as ExxonMobil, Royal Dutch Shell, or BP are active all the way along the supply chain from locating crude oil deposits, drilling and extracting crude, transporting it around the world, refining it into petrochemicals such as gasoline, to distributing the fuel to company-owned retail stations, where it is sold to consumers. To gain this complete control of the various resources needed to product oil and gas, the companies had to have engaged in _____ mergers.
vertical (oil and gas diff)
In a _____, the factors of production are owned collectively rather than individually, and no incentives to work harder or to produce quality products are provided.
communist economic system
When the Federal Reserve implements a _____, it tightens the money supply by selling government securities or raising interest rates.
contractionary policy
The Chubb Group, an insurance company, regularly supplies funds for programming on the public television network. Its donations are an example of:
corporate philanthropy
_____ is the practice of charitable giving by corporations; includes contributing cash, donating equipment and products, and supporting the volunteers' efforts of company employees.
corporate philanthropy
The Healing Garden is the manufacturer and marketer of organic beauty aids. Its annual $40,000 donation to The Nature Conservancy in support of the nonprofit organization's pledge to preserve the environment is an example of:
corporate philanthropy (garden)
Which of the following is an example of a natural trade barrier?
distance lice
Botswana produces diamonds, copper, nickel, soda ash, meat, and textiles, which it sells to the members of the European Union. To Botswana, the diamonds, copper, nickel, soda ash, meat, and textiles it produces are examples of:
export
The least costly and least risky method for selling a product on the global market is:
exporting
When sales of cheese in the United States began to stagnate, the U.S. dairy industry looked for a quick and easy method to reach global markets. From your understanding of how companies participate in the global marketplace, you should know that the dairy industry selected:
exporting RATIONALE:
Hard Rock Cafe International and Sol Melia Hotels and Resorts have allied to develop a multimillion-dollar hotel. This relationship is a _____ because their alliance will end as soon as the hotel is completed.
joint venture (hardrock)
Which of the following statements about human rights is true?
none of the above statements about individual rights is true
Bribery translates to kuroi kiri (black mist) in Japan, schmiergeld (grease money), and baksheesh (tip or gratuity) in the Middle East. This differing way of looking at bribes is descriptive of differences in:
culture
When the economy is in a recession, many companies must lay off workers, which causes _____ unemployment.
cyclical
Articles of incorporation do NOT include:
a list of all stockholders' names
IBM purchased MRO Software Inc. for $740 million. MRO was a niche provider of software and services to help customers including nuclear power plants and oil companies. IBM, plans to fold MRO into its software unit. This is an example of a(n):
acquisition
Which of the following statements about limited liability companies (LLCs) is true?
all of statements true about LLCs
Fred Pittman has invested $10,000 in his son's motorcycle repair shop, but he takes no part in its management. Pittman is a(n):
limited partner
_____ refers to sending work functions to another country resulting in domestic workers losing their jobs.
outsourcing
The fact that a corporation has limited liability means:
owners' liabilities are limited to the amount invested
Ease of formation, flexibility, and diversity of management are advantages of the _____ form of business ownership.
partenership
Stewed Tomatoes was an "all-girl power-pop trio." Its three members realized that many musicians feel stifled when making music in a sterile studio environment while the clock ticked away expensive hours, so the three girl band members created Materville Studios, a multimedia production house and recording studio in downtown Chicago. They share work responsibilities and profits equally. Materville Studios is a(n):
partenership
The most common form of business organization is the:
sole propriertorship
Tonya Thomas is tired of working for other people. She wants to start her own administrative services businesses and control her own work schedule. She wants to have sole responsibility for all business decisions. Thomas should form a(n):
sole propriertorship
A country that exports more goods than it imports is said to have a(n):
favorable balance of trade
Which of the following is NOT a form of unemployment?
fiscal unemployment
The _____ is an agreement that dramatically lowered trade barriers worldwide and created the new World Trade Organization (WTO).
uruguay round
The slope of the demand curve is:
downward and to the right
Peter Drucker, a well-known management scholar, has said that companies should be evaluated on two basic dimensions:
legality and responsibility
A company has achieved the level of _____ responsibilities when it has met its ethical, legal, and economic responsibilities.
philanthropic
During a two-month period Lladro Comercial, S.A., the manufacturer of handcrafted porcelains, donated ten percent of its retail profits to the Susan G. Komen Breast Cancer Foundation. The action was legal and ethical and allowed the company to still be profitable. According to the pyramid of corporate social responsibility, it was acting at the _____ responsibilities level.
philanthropic
Singapore has granted a(n) _____ on the importation of beer and stout made in the Philippines. This means that beer and stout made in the Philippines can sell for less in Singapore than beer and stout made by New Zealand or the United States.
preferential tariff
Archer Daniels Midland Co. (ADM) has joined with Baron Spices and Seasonings to market spices, seasonings and herbs to the foodservice industry. ADM will provide the raw materials, and Baron will act as the distributor and use its already existing relationships with participants in the food service industry to make a success of this:
strategic alliance
Which of the following is an example of a trend in ethics and social responsibility?
strategic giving
The laborers displaced due to assembly line automation at the textile plant may not have the skills needed to operate the computerized machines that replaced them. This is an example of _____ unemployment.
structural
Which of the following is the best example of a service?
the pleasure you derive from seeing a good play
Market equilibrium is:
the point at which quantity supplied equals quantity demanded
The implementation of a contractionary policy by the Federal Reserve would result in:
lower interest rates
Which of the following is an example of an ethical business activity?
the employee reported to his supervisors that coworker had misappropriated company funds
Which of the following statements about social responsibility is true?
the obligation that a business has to act socially responsible extends beyond the investors in the company to include workers, suppliers, consumers and communities
Jayson Tully is contemplating the purchase of a Popeye's Chicken franchise. Tully has made a list of the disadvantages that he assumes he will face as a new business owner. Which of the following is actually an advantage?
assistance in the building plans
A company can only be concerned about its _____ responsibilities once it has met its economic and legal responsibilities.
ethical
In the chocolate market, Green & Black is acting at the _____ responsibilities level of the pyramid of corporate social responsibility when it makes a profit, does so by abiding by the laws, and helps cocoa farmers by agreeing to pay above-market prices for cocoa.
ethical
When the government raises taxes on consumers and businesses, it is dealing with _____ policy.
fiscal
Which of the following is an example of a business?
all of the above (business)
In 1997, Russia and Ukraine exported carbon steel plate into the U.S. at a price much lower than the countries were found guilty of charging the identical steel in their home markets. Russia and Ukraine were engaged in:
dumping
It has been alleged that a Coca-Cola water bottling plant in India has caused illegal water shortages in fifty villages that surround the bottler. If this accusation is true, than Coke was operating at which stage of the social responsibility pyramid?
economic
A code of ethics:
is accurately described by all of the above (ethics)
Utilitarianism:
is difficult to implement bc one decision will impact a large amount of ppl
Social investing:
is the practice of limiting investments to companies that have ethical policies that match those of the investor
A _____ is when two or more companies form a special entity to undertake a specific project, usually for a specific period of time.
joint venture
An enterprise in which two or more firms or investors (including governments) share ownership of a business and its property rights is called a(n):
joint venture
A decline in real GDP that lasts for two consecutive quarters is called a(n):
recession
Strategic giving:
refers to the practice of typing philanthropy closely to the corporation's missions or goals
Before selling stock to the public, a corporation must register with the:
securities and exchange commission
The first step to incorporating a company is to:
select company's name
_____ is the practice of limiting investments to securities in companies that behave in accordance with the investor's beliefs about ethical and social responsibility.
social investing
U.S. Steel has established an alcoholic rehabilitation program for the city of Pittsburgh. The company provides the facilities and the personnel to operate the program. U.S. Steel is practicing:
social responsibility
Wal-Mart has announced that it will only sell fresh and frozen fish that come from environmentally sound sources and bear the label of the Marine Stewardship Council. Wal-Mart's size gives it a unique opportunity to improve the fishing industry. This concern for _____ is one of many initiatives Wal-Mart is introducing to improve our environment.
social responsibility
_____ is a philosophy that focuses on the consequences of an action to determine whether it is right or wrong. This philosophy holds that an action that affects the majority adversely is morally wrong.
utilitarianism
Capital Radio PLC, the United Kingdom's biggest commercial radio firm announced in 2002 that it would cooperate with Walt Disney Co. to create a radio network for children under the age of 16. The company will broadcast to a potential audience of 25 million under the name Capital Disney. This new radio network will be created as the result of:
joint venture
Another factor influencing business ethics is _____, or what is fair according to prevailing standards of society.
justice
China imposes a 45 percent tax on the market value of all chickens that are imported from the U.S. into China. Another name for this type of tax is a(n):
tariff
When Linda McAnem began Stirya, a New York-based computer services company, she ran it as a sole proprietorship. As the business grew, she realized that she did not want to be personally liable for the business's debts and wanted her business accounts to be separate from her personal accounts. Therefore, she should have:
incorporated stirya
The government does not consider full employment to mean 100 percent of its citizens are employed because:
all of the above conditions can add and do exist RATIONALE:
Members of millennial generation:
are not accurately described by any of these
Which of the following statements about the interaction of demand and supply is true?
at prices below equilibrium, demand exceeds supply.
For Lladro Comercial, S.A., the manufacturer of handcrafted porcelains, its employees, suppliers of the paints used to decorate its porcelains, retailers of its products, and people who benefit from its philanthropy are all:
stakeholders
One of the keys to ethical business behavior is:
how the company's top managment conducts themselves
_____ are limitations on the quantity of certain types of goods that can be imported over a period of time.
import quotas
Imagine you are trying to gather the information needed to calculate the balance of payments for an Eastern European country. To do your calculations, you would need to have information on all of the following EXCEPT:
its corporate tax rates
_____ is the amount of money remaining from a firm's sales revenue after it deducts production costs, interest costs, and taxes.
profit
Since the balance of payments is the summary of a country's financial transactions with another country, a discussion of a nation's balance of payments will need to include a discussion of:
all of the above (balance of pay)
Which of the following is an example of an unethical business activity?
all of the above are examples of unethical business activities
Which of the following statements about ethics training is true?
ethics training is formal training to develop awareness of inappropriate behavior and to practuce appropriate responses.
Many weight-loss programs advertise that they can help individuals lose a great deal of weight without any changes in the individual's lifestyle. Typically when the person who has lost the weight leaves the program, he or she regains all the lost weight. This yo-yoing is almost as bad for the body as the excess weight. These weight-loss programs are engaged in _____ behavior.
legal but irresponsible
The implementation of an expansionary policy by the Federal Reserve would result in:
lower interest rates
In perfect competition, there is:
a large numer of sellers producing nearly identical products
Iris Souza started the summer with $30. She took $10 and made signs for her dog walking service. She posted the signs all over her neighborhood. She used the other $20 to buy a stout leash and a pooper-scooper. At the end of the summer, after buying herself a new pair of shoes for $50 (she had worn her other shoes out walking dogs), she had $125 left. What was Souza's profit for her summer job?
$125
Clarence Danvers is buying a Cinnabon franchise at the airport in Tulsa. Danvers knows that he will get all of the following benefits EXCEPT:
assistance in personal income tax preparation
An S corporation:
does not make the owners of the corporation personally liable for its debts
In 1998, the Canadian Magazine Publisher's Association (CMPA) predicted the demise of many Canadian magazines because the World Trade Organization (WTO) made it legal for U.S. publishers to introduce product into the Canadian market, without incurring the start-up costs involved in launching a new magazine. By using split-run magazines (modifying the U.S. edition so they contain Canadian ads), U.S. magazine publishers could offer lower rates to advertiser and sell the magazines for less money than Canadian publishers could. According to the CMPA, the U.S. magazine publishers would be engaged in:
dumping
Double taxation in a corporation means:
earnings of the corp and divedends are both taxed
A total prohibition against importing certain products is called a(n):
embargo
_____ contributes to an employee's self-worth, which, in turn increases productivity and reduces absenteeism.
empowerment
The situation in which the average of all prices of products is rising is called:
inflation
Because the government owns the factors of production in public lands, postal service, and some water resources, Great Britain is considered a(n):
mixed economy
_____ refers to a government's programs for controlling the amount of money in circulation.
monetary policy
The European Union (EU) bans the importation of hormone-fed U.S. beef and bioengineered corn and soybeans on safety grounds although Americans eat this food every day. This ban is so consumers in the EU will buy domestic beef and products made from domestically produced corn and soybeans. This ban is an example of:
protectionism
Wal-Mart ran a series of ads in trade journals with the following headline: "We're Looking for Quality Products That Are Guaranteed Not to Last." What Wal-Mart was in fact doing was asking its suppliers to develop more environmentally friendly products and to use material that could be recycled. This concern about the environment is one way that Wal-Mart practices:
social responsibility
The economic system under which basic industries are operated by the government or owned by the private sector under strong government control is called:
socialism
The most fundamental reason for the growth in world trade is probably due to:
the need for businesses to expand their markets
How does the current boom in mergers and acquisitions differ from ones in earlier years?
there is a greater number of us and foreign companies making cross-border acquisitions
Why do most large companies have outside directors on their boards?
to bring a fresh view to all of corps activities
Mamma's Diner was a small restaurant that was a popular hangout for many Bedford College students, but because of the owner's inability to make the bathroom stalls handicapped accessible for the one wheel-chair student on campus, it was forced to close down. The belief that this it was morally wrong to deprive the majority of the people of this experience is an expression of the philosophy associated with:
utilitarianism
The original purpose of the _____ was to help build infrastructure in developing countries and to help relief the debt burden of these countries.
world bank
With a communist economy system:
none of the above is true
In a(n) _____, a few sellers can exert substantial control over prices.
oligopoly
The Japanese automobile manufacturer Mazda produces the Premacy SUV in Haikou, China at a plant it built in the Chinese province. Mazda is using _____ to engage in global trading.
direct foreign investment
Why would a company choose to engage in a conglomerate merger instead of a vertical or horizontal merger?
a conglomorate merger is done to reduce risk
What is the primary difference between a good and a service?
a good is tangible, a service is intangible
In Canada, the government owns the communications, transportation, and utilities industries, while most other activity is carried on by private enterprise. Canada is an example of:
a mixed economy
The unemployment rate is the percentage of the total work force that is not working but is:
actively looking for work
The _____ is defined as the difference in value of a country's exports and imports over a period of time.
balance of trade
Suzanne Pogell wanted to learn to sail, but she could find no one to teach her because men were the ones who sailed, and women were their crew. She finally did convince someone to teach her to sail, and after mastering sailing, she started an all-woman sailing school called Womanship as a sole proprietorship. When she dies, the:
business dies with her
Which of the following provides the legal and managerial guidelines for operating the firm?
bylaws
Individual ownership of property is a key element in:
capitalism
The _____ represents the prices of a market basket of goods and services as measured monthly by the Department of Labor.
consumer price index (CPI)
A domestic firm may decide to contract for the production of its goods by an established foreign manufacturer. Such private-label manufacturing by a foreign company is called:
contract manufactoring
A country's _____ is the set of beliefs, values, and social norms shared by members of a society that determines what is socially acceptable.
culture
_____ is the quantity of a good or service that people are willing to buy at various prices.
demand
_____ inflation is inflation that occurs when the demand for goods and services is greater than the supply.
demand-pull
Jarvis Washington recently quit his job as a veterinarian's assistant and is now trying to find a job with another veterinarian. This is an example of _____ unemployment.
frictional RATIONALE:
Three Sisters Specialty Foods, owned by Judith Coker, Millie Humphreys, and Jade Watson, sells eggless cake mixes for people on a restricted diet. Coker recently purchased an industrial grade mixer without conferring with her sisters who were upset when they learned that they were all three liable for the payments on the mixer. Three Sisters is an example of a:
general partnership
The Ford Motor Company has investing $6 billion to build a "world car," the midsize Mondeo. The car was designed in the U.S., Germany, and the United Kingdom to be adaptable to any market in the world. Ford is a(n) _____ company.
multinational
_____ move resources, goods, services, and skills across national boundaries without regard to the country in which they are headquartered.
multinational corporations
_____ is the sense of national consciousness that boosts the culture and interests of one country over those of all other countries.
nationalism
Which of the following statements about the taxation of partnerships is true?
partnerships file tax retuens but pass profits and losses on to parteners who report them on their tax returns
There are over 1,100 Corner Stores that market candy. When Valero Energy Corp. purchased the chain of retail stores, it was an example of a _____ merger.
vertical (candy and stores diff)
The merger of McKesson, the leading U.S. drug wholesaler, and HBOC, a producer of health-care inventory software, is an example of a(n) _____ merger.
vertical (diff things)
The _____ is the value of one currency in terms of another.
exchange rate
Which of the following statements about ethics training is true????
all of the above statements about ethics training are true.
A retailer that allowed its employees to handle a customer complaint without having to ask for permission or direction from management would have:
empowered its employees to help customers
A market in which there are a large number of firms that differentiate their products is called:
monopolistic competetition
An industry in which a few firms produce most or all of the output of a product and in which large amounts of capital are needed is called a(n):
oligopoly
The two types of cooperatives are:
buyer and seller
The Blue Bird Bus Company in Georgia sells buses to the South African government. To South Africa, these buses are an example of:
imports
The franchisor generally does NOT provide the franchisee with:
help in employee selection
An S corporation is generally set up to:
reduce tax burdens
Aaron Medford has invested $600 in the corporate stock of a manufacturer of offshore oil drilling equipment. If the company goes bankrupt, the most Medford could lose would be:
$600
North American Van Lines and Allied Van Lines combined in a _____ merger that will create the world's largest moving company. Prior to the merger, North American was the leading company in moving high-end merchandise such as computer and hospital equipment, while Allied specialized in households.
horizaontal (vans are horizontal)
Restricted operating freedom in franchising means that the franchisee must conform to:
all of the above (restict op)
_____ are laws that require a company earning foreign currency from its exports to sell the foreign currency to a control agency, usually a central bank.
exchange controls
When Ted Giovanni was preparing for his trip to Brazil, he found that he could go to his bank and trade his 10 U.S. dollars for 37.11 Brazilian real (the nation's currency). In this instance, the _____ was one U.S. dollar to 3.711 Brazilian real.
exchange rate (ted)
The Northwest Cherry Growers (headquartered in the state of Washington) sells much of its locally grown produce to Taiwan. _____ was the easiest and least expensive way for the growers' association to sell to global markets.
exporting
When Linda McAnem began Stirya, a New York-based computer services company, she ran it as a sole proprietorship. As a sole proprietor, McAnem:
found the business to be easy and inexpensive to form
The headquarters, seller, and supplier of the service or method of operation of a franchise is called the:
franchisor
Nations sometimes form free-trade associations and establish areas where there are few, if any, export and import duties or other regulations that would act as barriers to trade among partners. These are called:
free trade zones
Croutakie seemed like a great idea. Chef Leo Nyami and Sara Rice decided to take advantage of the popularity of shitake mushrooms and create some shitake mushrooms products that could be sold to restaurant patrons and other gourmets through their new company. Nyami and Rice have recently abandoned their business because they could not pay its outstanding business debts. Since Nyami and Rice are both liable for the debts, their business was a(n):
general partnership
The World Trade Organization (WTO):
has emerged as the world's most powerful institution for reducing trade barriers and opening markets
Paul Hyatt owns and operates DeepClean, a Florida-based company that cleans up mold and mildew in homes and businesses. As the sole proprietor of the business, he has unlimited liability, which means:
he is fully liable for all business debts
AT&T entered into a _____ with Compagnie General d'Electricite, a French company. The French company brings its patents on digital telephone switches, and AT&T provides the marketing know-how to the relationship.
joint venture
U.S. plane manufacturer McDonnell-Douglas has authorized Mitsubishi Heavy Industries, a Japanese company, to use its trademarks, patents, and other proprietary knowledge to manufacture F-15 fighter planes. Mitsubishi Heavy Industries pays McDonnell-Douglas. This is an example of:
licensing
The combination of two companies that join to form one company is called a:
merger
The _____ for the Music Teacher's National Associations establishes a standard of conduct and recommends a set of responsibilities teachers should have toward students, colleagues and the public. These guidelines assist the professional music teacher in gaining the respect of peers and avoiding conflicts and complaints with students and others. It points out to members what are and what are not considered fair, honest and reasonable practice when dealing with students, colleagues and the public, it provides guidance for such aspects as advertising practices, appropriate relationships, and personal and professional integrity.
code of ethics
If a country specializes in goods that it can produce most readily and cheaply and trades those goods for the goods that another country can produce most readily and cheaply, then both countries are exercising the principle of:
comparative advantage
_____ is the set of moral standards for judging whether something is right or wrong.
ethics
Summer Dean was walking through the mall and found a gym bag lying on the ground. The decision Dean must make as to whether to keep the gym bag and its contents for herself or turn it into the mall's lost and found department involves:
ethics (summer)
_____ is the practice of tying philanthropy closely to the corporate mission or goals and targeting donations to regions where a company operates.
strategic giving
Kraft Foods Inc. joined with the National Latino Children's Institute to announce Salsa, Sabor y Salud - a first-of-its-kind healthy lifestyles educational program designed by Latinos for Latinos. The program was created by NLCI in partnership with Kraft to support Hispanic families, a population particularly at risk for obesity and accompanying health problems. Kraft donated $2 million to the program's startup. This donation is an example of:
strategic giving (Kraft food)
Fiscal policy is concerned with:
taxation and spending
Which of the following countries has a high standard of living?
the United States
The standard of living in any country is:
measured by the output of goods and services people can buy with the money they have
Which of the following statements about utilitarianism is true?
urilitarianism holds that an action that affects majority adversely is morally wrong
Criticism of South Africa's post-apartheid government contends that the new government has not extended liberties to its black majority population, but has instead concentrated on proving to a white minority that a black-run administration can govern a reasonably sophisticated economy and society. The belief that the new South African government is behaving unethically is an expression of the philosophy associated with:
utilitarianism (africa)
