Chapter 1

Meria Het, a footwear company, designs formal and casual footwear for White American women. However, to increase its customer base, it introduces a line of footwear for Chinese women in the United States, even though they form only a small market in the country. Which of the following dimensions of the social environment does this scenario exemplify?

Diversity The given scenario exemplifies the dimension of diversity. While the American population has always included an array of different cultures, the United States has become more ethnically diverse in recent years.

In the context of making a career choice, following one's passion guarantees a fat paycheck

False Following one's passion doesn't guarantee a fat paycheck, but it does boost one's chances of both financial and personal success.

The significance of the social dimension of a business environment is highlighted when a number of states—from Alabama to Nevada—make their local economies more appealing by providing special tax deals to attract new firm

False The significance of the economic dimension of a business environment is highlighted when a number of states—from Alabama to Nevada—make their local economies more appealing by providing special tax deals to attract new firms

The value of all natural resources tends to rise with low demand, high supply, or both.

False The value of all natural resources tends to rise with high demand, low supply, or both.

In the context of the history of American business, which of the following statements is true of the entrepreneurship era?

Industrial titans exploited workers and decimated the environment. During the entrepreneurship era, many industrial titans dominated their markets, forcing out competitors, manipulating prices, exploiting workers, and decimating the environment.

Which of the following factors is most likely to be covered by the social environment dimension of a business?

Population size The social environment covers demographics, or the measurable characteristics of a population. Demographic factors include population size and density and specific traits such as age, gender, race, education, and income.

Marina, a garments manufacturing company, signed a contract with Tertch Tex, a textile company, to receive 2 million pounds of yarn at a rate of $2 per pound. However, Tertch Tex hikes up the price to $5 per pound just before the day of delivery. Marina files a lawsuit against Tertch Tex for breaking an enforceable contract and receives $100 million in compensation. In this context, which dimension of the business environment is affected the most?

The economic environment The economic environment is affected the most. A key element of the U.S. economic environment is legislation that supports enforceable contracts.

Buba Joe's Pizzeria, a fast food chain, wants to expand its customer base. It introduced a new range of vegan pizzas to cater specifically to the vegan market. It also introduced new flavors to cater especially to Hispanic Americans. In this context, which dimension of the business environment is affected the most?

The social environment The social environment is affected the most. The social environment of business embodies the values, attitudes, customs, and beliefs shared by groups of people.

In the context of factors of production, the synthetic resources that a business needs to produce goods or services are referred to as__________.

capital Capital includes machines, tools, buildings, information, and technology—the synthetic resources that a business needs to produce goods or services.

Mavin is the regional manager of Crustie Mex, a packaged food company. He is respected by his peers and subordinates for his immense knowledge and skills. Mavin decides to quit the company for a higher position at another firm. The CEO of Crustie Mex entices him with a competitive compensation package and promotion because he knows that Mavin is an important resource. The given scenario most likely exemplifies the concept of _____.

workforce advantage The given scenario most likely exemplifies the concept of workforce advantage. Employees can contribute a key dimension to a firm's competitive edge. Finding and holding the best talent will likely become a crucial competitive issue in the next decade as the baby boom generation begins to retire.