Exam 2: The Environment of Business

Which of the following is accurate regarding purchasing power parity? It gives us a better idea of what people can actually buy with the financial resources they have. It reflects the principle that exchange rates are set so that prices of similar products in different countries are unequal. It does not really give a good sense of the standards of living around the world. It reflects the principle that capitalism is a better system than communism. None of these statements are accurate.

Purchasing power parity is a principle that states exchange rates are set so that the prices of similar products in different countries are about the same.

What is productivity?

Which of the following is not an example of a factor in the socio-cultural environment? Prepackaged chili is more popular in southwestern U.S. states than in the U.S. northeast. Consumers in China perceive bicycles primarily as a mode of transportation, while consumers in Canada perceive bicycles as recreational items. Companies are more likely to set up foreign operations in countries with stable political and economic systems. McDonald's has added salads and other low fat foods to its menu. Many people in the Middle East are unwilling to work in food service operations.

How might low inflation levels in the general economy affect a company like McDonald's? McDonald's will pay much higher prices for supplies and will charge customers more for its products. McDonald's will pay higher prices for supplies and will charge customers more for its products. McDonald's will pay relatively constant prices for supplies, but will be unable to increase the price paid by customers. McDonald's will pay relatively constant prices for supplies and will charge customers more for its products. McDonald's will pay higher prices for supplies, but will be unable to increase the price paid by customers.

There is a trend toward mixing business and entertainment. This is an example of which element of the external environment?

Most successful firms are getting leaner by focusing on their ________, the skills and resources with which they compete best and create the most value for owners. viral marketing core competencies processes business process management political‒legal environment

What is viral marketing? Why do firms use it?

________ is often cited as a buyer that puts tremendous pressure on its suppliers. The Bay Canadian Tire Target Walmart Costco

If GDP is going up, the nation is experiencing inflation. growth. an increase in demand. a recession. it is not possible to tell given the information provided.

The economy in the African nation Sponeto has been stagnant for a long time. The government and central bank of Sponeto have been considering options for what can be done to help stimulate investment and growth in the economy. The Sponeto national bank advocates increasing the money supply to encourage investment within the country. Which of the following, if true, would strengthen the case that this will cause inflation? Jobs will be created. Banks will lower interest rates. Wages will decrease. Foreign investment will be discouraged. Only low-technology sectors will benefit.

The ________ is the growth rate of GDP adjusted for inflation and change in value of the country's currency. adjusted growth rate gross national product real growth rate per capita GDP real GDP

At one time, about ________ of the population of Canada was involved in producing the food that we needed; today less than ________ percent of the population works in agriculture. half; 0.5 half; 2.5 one-third; 5 three-quarters; 2.5 four-fifths; 3

________ is a measure of economic growth that compares how much a system produces with the resources needed to produce it. Purchasing power parity Stability Recession Inflation Productivity

________ uses games, contests, chat rooms, and bulletin boards to encourage potential customers to try out products and tell other people about them. Relationship marketing Business process management Enterprise planning Vertical integration Viral marketing

Low inflation will allow McDonald's to increase the prices it charges consumers.

What is the national debt?

What is viral marketing?

The major cigarette companies have been experiencing a decline in sales due to the overall decrease in smoking across Canada in recent years. These companies are being affected by which dimension of their external environment? Technological Global Business Socio-cultural Economic

List the four phases in the business cycle.