Intro To Business Chapter 1-6 Practice Questions

What is the primary difference between a good and a service? A. A service is tangible, and a good is intangible. B. A good costs more to market than a service C. The development costs for a service is higher than for a product. D. A good is tangible, and a service is intangible. E. A good costs more to produce than a service.

D. A good is tangible, and a service is intangible.

What type of business organization generates the most total sales? A. Partnership B. Cooperative C. Corporation D. Sole proprietorship E. General partnership

C. Corporation

_____ is the reduction of a currency's value relative to another currency. A. Deregulation B. Evaluation C. Devaluation D. Exchange depreciation E. Currency leveling

C. Devaluation

A code of ethics: A. is a summary statement of the firm's goals, policies, and priorities B. is considered by some to be public relations gimmicks C. all D. can offer a lengthy and detailed set of guidelines to employees E. provides employees with the knowledge of what their firm expects in terms of their responsibilities and behavior toward fellow employees, customers, and suppliers

is accurately described by all of the above

What are the benefits associated with free trade and globalization? A. An open economy that spurs innovation B. Higher probability that inflation will arrest economic growth C. All of the above D. Prevents employers from using pay cuts to threaten employees E. Decreased per capita income

A. An open economy that spurs innovation

The Small Business Administration (SBA): A. helps people start and manage small businesses B. is a financial institution C. is a privately-owned company D. does not have a Web site E. is accurately described by all of the above

A. helps people start and manage small businesses

The most common form of business organization is the: A. cooperative B. limited partnership C. corporation D. sole proprietorship E. general partnership

D. sole proprietorship

Venture capital: A. is another name for the principal which a business borrows from a bank B. is financing obtained from investment firms that specialize in financing small, high-growth companies C. is borrowed money invested in start-up businesses and provided by the Small Business Administration D. gives the investor no voice in how the company in which he or she has invested will operate E. includes all the money the owner of the business invests in his or her new enterprise

is financing obtained from investment firms that specialize in financing small, high-growth companies

_____ is the set of moral standards for judging whether something is right or wrong. A. Legality B. Ethics C. Social responsibility D. Consumerism E. The marketing concept

B. Ethics

The _____ prints money and controls its circulation. A. U.S. Treasury Department B. Federal Reserve System C. FDIC D. Savings and Loan Association E. U.S. Congress

B. Federal Reserve System

_____ planning is short-range, detailed planning that is based on long-range planning. It typically has a time frame that is less than one year long. A. Strategic B. Tactical C. Hands-on D. Procedural E. Functional

B. Tactical

The difference between a country's total payments to other countries and its total receipts from other countries is called its: A. financial deficit B. balance of payments C. balance of trade D. balance of exchange E. financial surplus

B. balance of payments

The person who takes the risk of starting and managing a business to make a profit is called a(n): A. venture capitalist B. entrepreneur C. capitalistic adventurer D. ultra capitalist E. franchiser

B. entrepreneur

_____ are goods and services that are made in one country and sold to other countries. A. Countertrades B. Tariffs C. Tangibles D. Exports E. Imports

D. Exports

_____ skills refer to a manager's ability to operate in diverse cultural environments. A. Diversity B. Professional C. Cultural D. Global management E. Human relations

D. Global management

A homebuilder who disposes of asbestos shingles by burying them on his own property may please the home owner because it is a less expensive means of disposal but will be punished by various legal agencies if any become aware of his crime. At which stage of the social responsibility pyramid is the builder most likely operating? A. stakeholder B. philanthropic C. ethical D. economic E. legal

D. economic

One of the keys to ethical business behavior is: A. how many levels of organization does the business have B. how many people near retirement age are in the company C. the perception of the company by its employees D. how the company's top management conducts themselves E. the number of rules, regulations, and guidelines the company has

D. how the company's top management conducts themselves

The development of new drugs is very expensive. For this reason Genentech, a large biotechnical company, has entered into a _____ with Swiss-owned Roche to develop a vaccine for tuberculosis. When the vaccine is developed or when the two biotechnical companies determine the vaccine cannot be developed using their current methodology, this relationship will dissolve. A. general partnership B. C corporation C. cooperative D. joint venture E. limited-time partnership

D. join venture

Which of the following statements about corporate culture is true? A. Corporate culture is intangible. B. Corporate culture is based on the accumulated history of the organization. C. Corporate culture can have a strong impact on a company's success. D. Corporate culture evolves over time. E. All of the above statements about corporate culture are true.

E. All of the above statements about corporate culture are true.

Which of the following statements about the partnership as a form of business ownership is true? A. Termination of the partnership is simple. B. Disagreements between partners are rare. C. Stockholders in partnerships have voting rights. D. Liability for the partners is limited. E. Formation of the partnership is simple.

E. Formation of the partnership is simple.

_____ is at the core of most business failures. A. Too much inventory B. Poor cash flow C. Low interest rate D. A too tall hierarchical structure E. Inadequate planning

E. Inadequate planning

A well-written business plan should contain: A. executive summary or company overview B. a marketing plan C. a vision and mission statement D. a management plan E. all of the above

E. all of the above

Management involves: A. leadership B. organizing C. controlling D. planning E. all of the above

E. all of the above

Social responsibility should extend beyond the shareholders to include: A. suppliers B. employees C. consumers D. community E. all of the above

E. all of the above

Which of the following is an example of a business? A. Ford Motor Company B. Lawson & Tyler law offices C. Wal-Mart D. Jack & Jill, a specialty clothing store for young children E. all of the above

E. all of the above

The government does not consider full employment to mean 100 percent of its citizens are employed because: A. some people are not working because jobs are limited, and competition for jobs is intense. B. some people choose to stay home to raise children rather than have a job outside the home C. some people are preparing for later employment by attending school D. some people are temporarily unemployed while they wait to start new jobs E. all of the above conditions can and do exist

E. all of the above conditions can and do exist

Who owns a corporation? A. its board of directors B. its board of directors and major stockholders C. its president D. its employees E. everyone who owns a share of stock in the corporation

E. everyone who owns a share of stock in the corporation

The fifth factor of production identified by many managers and academicians is: A. nanotechnology B. productivity C. quality D. social responsibility E. knowledge

E. knowledge

Free trade: A. allows companies to conduct business without licenses B. relies on bartering as its primary means of exchange C. establishes artificial barriers to trade D. is also called protectionism E. permits people to buy and sell where they please

E. permits people to buy and sell where they please

The lowest level of management, which usually has the most people to manage, is called _____ management. A. strategic B. middle C. functional D. top E. supervisory

E. supervisory