Principles of Business pt. 1

34. Lack of economic growth is a major problem for A. market B. communist command C. traditional D. Socialist command

c

46. If expenses are greater than income, there's no A. sales. B. risk. C. reward. D. guarantee.

c

4. A business that fails to protect its employees from unnecessary risk or health hazards on the job may be sued for A. libel. B. misrepresentation. C. negligence. D. incompetence.

c

51. Carefully selecting goods or services to sell is an example of handling business risks by the risk. A. bypassing B. transferring C. controlling D. avoiding

c

6. Wendy's sells the right to operate its restaurants to individuals who meet the company's criteria. The arrangement between Wendy's and these individuals is an example of A. licensing. B. multi-level marketing. C. franchising. D. a partnership agreement.

c

15. Consumers are typically most willing to pay more for goods and services that bring them greater A. trade-offs. B. popularity. C. opportunity costs. D. satisfaction.

d

26. To discover a product's level of utility, marketers measure the consumer's A. desire. B. perspective. C. attitude. D. satisfaction.

d

10. ABC Specialty Wear is the only company that has written permission to use a national football team's logo on its sportswear. This is an example of a A. licensing agreement. B. sole proprietorship. C. product trade-name contract. D. limited joint-venture contract.

a

13. What are the three basic economic questions? A. What products will be produced; how will products be produced, and how will products be allocated? B. When will products be produced; how will products be produced, and how will products be allocated? When will products be produced; what products will be produced; and how will products be allocated? C. Where will products be produced; when will products be produced; and what products will be produced?

a

16. What determines whether an economic product is an industrial product or a consumer product? A. Who buys and uses the product B. The price of the product C. Who produces the product D. The origin of the product

a

19. If a good or service is scarce, consumers will usually be A. willing to pay money to get it. B. uninterested in owning it. C. able to get as much of it as they want. D. unwilling to buy it.

a

20. A student purchased a laptop to use for homework assignments. In economic terms, this computer would be classified as a(n). A. consumer B. capital C. ultimate D. industrial

a

30. What role does utility play in the implementation of the marketing concept? A. A satisfaction gauge B. A payment method C. A cost-saving tool D. A delivery process

a

33...In a communist command economy who decides how the economic questions will be answered? A. Government B. Individuals C. Businesses D. Venture team

a

36. Why does the government set and collect taxes? A. To help pay the expenses of government B. To increase the use of technology C. To provide economic security D. To help businesses grow and prosper

a

37. Which of the following is a public good that is provided by the government: A. Interstate highways B. Marketing research C. New automobiles D. Private schools

a

38. Which of the following government actions is most likely to stimulate the economy: A. Lowering tax rates! B. Raising the prime interest rate C. Printing less money D. Borrowing more money

a

40. Government can prevent unqualified persons from operating a business by A. refusing to grant them a license. B. closing their bank accounts. C. raising their taxes. D. helping their competitors.

a

42. Which of the following is a disadvantage of private enterprise: A. Periods of unemployment B. Elimination of poverty C. Careful use of resources D. Equal distribution of income

a

45. Why are entrepreneurs important in a private enterprise system? A. They encourage the development of new products, B. They use resources inefficiently. C. They get rid of competition. D. They are responsible for deceptive advertising.

a

52. Contractual agreements such as guarantees, surety bonds, and leases are examples of handling business risks through A. transfer. B. management. C. avoidance. D. prevention or control.

a

1. What is one reason why the federal government awards patents to businesses that have invented new products or manufacturing processes? A. To protect consumers B. To encourage research C. To restrict monopolies D. To monitor advertising

b

11. Which one of the following groups of words best describes wants: A. Limited, changing, and compensating B. Unlimited, changing, and competing C. Limited, unchanging, and competing D. Unlimited, unchanging, and compensating

b

12. In economics, the term capital goods includes A. labor and management. B. buildings and equipment. C. trees and water. D. mental and physical work.

b

2. The law that requires businesses to hire, train, transfer, and promote employees without regard to race, color, gender, religion, or national origin is the _Act. A. Sherman Antitrust B. Civil Rights C. Robinson-Patman D. Federal Reserve

b

21. Using a stream to supply water to a field in order to grow crops is an example of using A. human resources. B. natural resources. C. capital goods. D. nonrenewable resources.

b

23. Which of the following economic resources is responsible for combining the other resources to produce goods and services: A. Natural resources B. Human resources C. Capital goods D. Nonrenewable resources

b

29. Which change provides the most time utility for a consumer? A. Arriving at a product trade show early B. Staying open for business on the weekend C. Shopping for a product in the morning D. Asking for early delivery of a product

b

39. What is the government doing when it buys wheat to keep the price high enough for farmers to make a profit? A. Encouraging the production of wheat B. Using price supports C. Industrializing the economy D. Encouraging energy conservation

b

43. Private enterprise is based on the idea that everyone is better served when A. businesses regularly increase their prices, B. individuals are free to set their own goals. C. government determines where'individuals will work. D. economic resources are controlled by the government.

b

48. Each purchase strengthens the economy by encouraging A. expansion. B. trade. C. investment. D. competition.

b

49. A popular product is said to be A. late. B. in demand. C. out of style. D. available.

b

5. An advantage to a business of filing Chapter 11 bankruptcy is that the process allows the business to A. liquidate. B. reorganize. C. eliminate taxes. D. sell assets.

b

50. Which activities are likely to increase a firm's profit? A. Increasing supplies and decreasing production B. Increasing sales and decreasing expenses. C. Decreasing sales and increasing expenses . D. Decreasing supplies and increasing production

b

9. One reason a physicians' practice might form a partnership as an LLP is to A. take advantage of higher dividend returns on shares of its stock. B. protect innocent partners from the malpractice of another partner. C. ensure that the business experiences unlimited liability. D. permit the general public to purchase licensing rights in the practice.

b

14. The ultimate goal of all economic activity is A. exchange. B. production. C. consumption. D. distribution.

c

17. A characteristic of human wants is that they are A. limited B. unchanging. C. unlimited D. consistent

c

18. Producers respond to consumers' positive economic votes by A. producing more industrial goods. B. decreasing production. C. increasing production. D. classifying their goods and services.

c

22. Which of the following occurs when the supply of individuals who are able and willing to work diminishes: A. Capital goods become unlimited. B. Capital goods become limited. C. Human resources become limited. D. Human resources become unlimited

c

24. Over the next few years, members of Generation X and Generation Y are expected to fill many job positions vacated by retiring Baby Boomers. This is an example of a change in A. automated processes. B. nonrenewable resources. C. workforce demographics. D. new capital goods

c

27. Changing a good's form involves which of the following: A. Making sure the good is available early B. Getting the good to the retailer C. Adding a new feature to the good D. Providing an easy way to buy the good

c

28. When marketers provide information about an available product, consumers are more likely to A. request a payment plan. B. ask questions about the product. C. buy the product. D. put the product on layaway.

c

31. Government owns the basic means of production but there is some private ownership of businesses under A. capitalism. B. communism. C. socialism. D. entrepreneurship.

c

32. The way in which an economic system answers the basic economic questions depends upon the country's A. demand. B. supply. C. government. D. resources.

c

7. John, Robert, and Charles were college friends who wanted to start a business. John has creative ability, Robert's expertise is selling, and Charles' expertise is management. However, each has limited capital. The ideal business ownership for these young men is a A. franchise. B. merger. C. partnership. D. corporation.

c

25. Which of the following situations involves finding an alternative resource to use in place of a nonrenewable natural resource: A. Searching for oil in new locations such as the ocean floor B. Passing legislation to prevent the killing of endangered animals C. Generating energy from wind turbines instead of solar panels D. Powering a motor vehicle with bio diesel instead of gasoline.

d

3. What type of property is a business protecting when it registers its trademark? A. Administrative B. Tangible C. Statutory D. Intellectual

d

35. Which of the following is a potential problem in market economies? A. Production quotas for businesses B. Total government control C. No competition D. Financial loss

d

41. Alex owns a guitar, several books, a car, and a telescope. Alex's possessions are examples of A. equal distribution. B. economic resources. C. capital goods. D. private property.

d

44. One of the freedoms provided to individuals by the private enterprise system is the freedom to choose A. which laws they will obey. B. how their employers pay them. C. which taxes they will pay. D. where they will work.

d

47. Gross profit shows business owners the difference between what they've A. estimated and invoiced. B. paid and risked. C. received and billed. D. spent and received.

d

53. Changes in the market that cause prices to go up or down, products to change, and businesses to succeed or fail are examples of risks. A. natural B. competitive C. human D. economic

d

54. Management decides to hold its annual meeting in one U.S. city rather than another because of crime in that city. This is an example of the risk. A. transferring B. preventing or controlling C. retaining D. avoiding

d

8.Jake wanted to run his own business but was unsure that he had adequate business skills to be successful. Which type of business would give Jake the help he needs? A. Product trade-name franchise B. Sole proprietorship C. Private corporation D. Business-format franchise

d