Question 1

The U.S. population tends to buy the same things and spend time in roughly the same way as people did a decade ago.

Accepted Answer

A) True 
 B)False

Question 2

The only real purpose of a business is to make money for entrepreneurs.

Accepted Answer

A) True 
 B)False

Question 3

Health care availability, a clean environment, and good schools all contribute to a high quality of life.

Accepted Answer

A) True 
 B)False

Question 4

Laws that allow companies to write enforceable contracts decrease the risk of doing business.

Accepted Answer

A) True 
 B)False

Question 5

Mini-Case
Eli Moneybags works for Second Commercial Bank, one of the largest banks in the Southwestern U.S. He is a loan officer, specializing in mortgages. Tio Jaime, Eli's favorite (and wealthiest) uncle, passed away last month and left him a sizable amount of money. Eli is looking at the best way to invest his newly acquired wealth. He is considering many options, ranging from simply putting the money into a savings account to the possibility of starting his own business. Although his bank job pays well and offers pleasant working conditions, Eli is frustrated because he has little freedom or flexibility to deal with customers since every decision he makes must be approved by his supervisor. He is also a bit bored and looking for a new challenge. He thinks he might get a lot of satisfaction from owning his own business. Eli has not made a definite decision yet, but has talked to a lot of people searching for a good idea for a new business. If he can come up with an idea he likes, he might just quit his current job and use his inheritance to go into business for himself!
-Eli's frustration with his lack of freedom at work indicates that Second Commercial

Accepted Answer

A)  prefers the use of cross-functional teams rather than individual initiative. 
B)  has not adopted a strategy of empowerment. 
C)  knows that the best way to ensure good customer service is to closely monitor its lower-level employees. 
D)  is trying to please customers as well as other stakeholders. 
A)  prefers the use of cross-functional teams rather than individual initiative. 
B)  has not adopted a strategy of empowerment. 
C)  knows that the best way to ensure good customer service is to closely monitor its lower-level employees. 
D)  is trying to please customers as well as other stakeholders.

Question 6

Bar codes are a form of technology that has enhanced a company's ability to be responsive to consumer needs.

Accepted Answer

A) True 
 B)False

Question 7

Starting a business always involves ________.

Accepted Answer

A)  profit 
B)  loss 
C)  revenue 
D)  risk 
A)  profit 
B)  loss 
C)  revenue 
D)  risk

Question 8

If they wish to create more wealth, poor nations should focus on policies that increase entrepreneurship and the effective use of knowledge.

Accepted Answer

A) True 
 B)False

Question 9

Money is one of the five factors of production that contribute to the creation of wealth.

Accepted Answer

A) True 
 B)False

Question 10

The advice provided by a personal trainer is an example of the service industry.

Accepted Answer

A) True 
 B)False

Question 11

HealthLink Hospital is looking into introducing a flextime program for its employees. A group of workers who would probably benefit from flextime is

Accepted Answer

A)  workers who do not have access to computers at home. 
B)  workers who have little self-motivation to work eight-hour days. 
C)  frontline workers who frequently go out to meet with home furnishing designers. 
D)  single-parent families. 
A)  workers who do not have access to computers at home. 
B)  workers who have little self-motivation to work eight-hour days. 
C)  frontline workers who frequently go out to meet with home furnishing designers. 
D)  single-parent families.

Question 12

Which of the following is a factor of production?

Accepted Answer

A)  Bonds 
B)  Money 
C)  Knowledge 
D)  Service 
A)  Bonds 
B)  Money 
C)  Knowledge 
D)  Service

Question 13

A policy of empowerment encourages managers to make decisions quickly for their frontline employees.

Accepted Answer

A) True 
 B)False

Question 14

One of the major advantages to firms involved in e-commerce is that the technology is still so new that the online firms face very little competition.

Accepted Answer

A) True 
 B)False

Question 15

Businesses favor:

Accepted Answer

A)  minimal government spending because it keeps taxes to a minimum. 
B)  more government services because it minimizes tax consequences. 
C)  maximum government spending because it raises business profits. 
D)  less government spending because it lowers business profits. 
A)  minimal government spending because it keeps taxes to a minimum. 
B)  more government services because it minimizes tax consequences. 
C)  maximum government spending because it raises business profits. 
D)  less government spending because it lowers business profits.

Question 16

Which of the following statements about the competitive environment is most accurate?

Accepted Answer

A)  Firms that produce a quality product will always succeed in the competitive marketplace. 
B)  Traditional firms will be unable to successfully compete against the new online firms unless they immediately create a way to reach customers through the Internet. 
C)  Firms that empower their employees will continue to perform poorly in the competitive environment. 
D)  Companies now have to offer both high-quality products and outstanding service at competitive prices. 
A)  Firms that produce a quality product will always succeed in the competitive marketplace. 
B)  Traditional firms will be unable to successfully compete against the new online firms unless they immediately create a way to reach customers through the Internet. 
C)  Firms that empower their employees will continue to perform poorly in the competitive environment. 
D)  Companies now have to offer both high-quality products and outstanding service at competitive prices.

Question 17

Globalization

Accepted Answer

A)  has greatly improved living standards around the world. 
B)  has significantly reduced living standards around the world. 
C)  has opened doors to only a handful of markets. 
D)  has greatly changed companies that hire people to sell products, but not companies that hire people to provide services. 
A)  has greatly improved living standards around the world. 
B)  has significantly reduced living standards around the world. 
C)  has opened doors to only a handful of markets. 
D)  has greatly changed companies that hire people to sell products, but not companies that hire people to provide services.

Question 18

According to the box, "Hollywood Climbs the Great Wall," casting American actors of Chinese descent attracts larger audiences in China rather than casting a Chinese actor.

Accepted Answer

A) True 
 B)False

Question 19

Two factors of production that seem to contribute the most to a nation's ability to create wealth are:

Accepted Answer

A)  land and labor. 
B)  land and capital. 
C)  entrepreneurship and labor. 
D)  entrepreneurship and knowledge. 
A)  land and labor. 
B)  land and capital. 
C)  entrepreneurship and labor. 
D)  entrepreneurship and knowledge.

Question 20

According to the box, "Hollywood Climbs the Great Wall," Chinese investors are not only distributing Hollywood films in their home country, they are also

Accepted Answer

A)  producing films to distribute in South America. 
B)  buying companies that manufacture cameras and sound equipment. 
C)  creating theatrical education programs in the nation's universities. 
D)  investing in American entertainment companies and working to make China a moviemaking power. 
A)  producing films to distribute in South America. 
B)  buying companies that manufacture cameras and sound equipment. 
C)  creating theatrical education programs in the nation's universities. 
D)  investing in American entertainment companies and working to make China a moviemaking power.

Exam 1: Taking Risks and Making Profits Within the Dynamic Business Environment

The U.S. population tends to buy the same things and spend time in roughly the same way as people did a decade ago.

The only real purpose of a business is to make money for entrepreneurs.

Health care availability, a clean environment, and good schools all contribute to a high quality of life.

Laws that allow companies to write enforceable contracts decrease the risk of doing business.

Bar codes are a form of technology that has enhanced a company's ability to be responsive to consumer needs.

Starting a business always involves ________.

If they wish to create more wealth, poor nations should focus on policies that increase entrepreneurship and the effective use of knowledge.

Money is one of the five factors of production that contribute to the creation of wealth.

The advice provided by a personal trainer is an example of the service industry.

HealthLink Hospital is looking into introducing a flextime program for its employees. A group of workers who would probably benefit from flextime is

Which of the following is a factor of production?

A policy of empowerment encourages managers to make decisions quickly for their frontline employees.

One of the major advantages to firms involved in e-commerce is that the technology is still so new that the online firms face very little competition.

Businesses favor:

Which of the following statements about the competitive environment is most accurate?

Globalization

According to the box, "Hollywood Climbs the Great Wall," casting American actors of Chinese descent attracts larger audiences in China rather than casting a Chinese actor.

Two factors of production that seem to contribute the most to a nation's ability to create wealth are:

According to the box, "Hollywood Climbs the Great Wall," Chinese investors are not only distributing Hollywood films in their home country, they are also

Understanding Economics and How It Affects Business

Doing Business in Global Markets

Demanding Ethical and Socially Responsible Behavior

How to Form a Business

Entrepreneurship and Starting a Small Business

Management and Leadership

Structuring Organizations for Todays Challenges

Production and Operations Management

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Dealing With Employeemanagement Issues

Marketing: Helping Buyers Buy

Developing and Pricing Goods and Services

Distributing Products

Using Effective Promotions

Understanding Accounting and Financial Information

Financial Management

Using Securities Markets for Financing and Investing Opportunities

Money, Financial Institutions, and the Federal Reserve

Working Within the Legal Environment

Using Technology to Manage Information

Managing Risk

Managing Personal Finances

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