Exam 2: The Environment of Business

Which of the following would not likely be a consequence of a recession? Aggregate output declines. Producers will hire more employees. Unemployment will increase. Less labour will be needed to produce products. GDP will decrease.

The external environment has only a limited impact on the success or failure of most organizations, but it does have a significant impact on some firms.

A(n) ________ separates the organization from its environment. organizational boundary process boundary enterprise resource aggregate output integration

Why is it important for businesses to be aware of trends in the political‒legal environment?

A budget deficit refers to the measure of economic growth that compares how much a system produces with the resources needed to produce it. government spending more in one year than it takes in during that year. the total of a country's exports minus its imports. the total amount of money that Canada owes its creditors. the exchange rate that is set so prices of similar products in different countries are the same.

Explain purchasing power parity.

Don is unemployed because of a downturn in economic activity; this is an example of ________ unemployment. frictional seasonal structural cyclical none of these

When Microsoft introduced Encarta, it caused the sale of hard copy encyclopedias sold by Encyclopedia Britannica to drop sharply. This is an example of which of Porter's five forces? Rivalry among existing competitors Threat of potential entrants Suppliers Buyers Substitutes

How is Porter's Five Forces Model useful?

Which of the following would be excluded from the GDP of Brazil? A Canadian company produces and sells products in Brazil A U.S. company produces and sells products in Brazil A Brazilian company produces and sells products in Canada A Brazilian company produces and sells products in Brazil it is not possible to tell given the information that is provided

A corporation may overcome the resistance of a takeover target by implementing which of the following actions? Buy the target company's preferred stock instead of its common stock Reduce the price offered for the target company's stock Threaten to fire the officers of the target company Buy more of the target company's stock File a lawsuit

Which of the following would be included in the GNP of Brazil? A Canadian company produces and sells products in Brazil A Brazilian company produces and sells products in Canada A U.S. company produces and sells products in Brazil A Brazilian company produces and sells products in Brazil it is not possible to tell given the information that is provided

Stone Inc. has just been through a friendly takeover. This means that these two firms are in a completely unrelated businesses merge. two firms agree to join together. the acquired company welcomes the acquisition because it may need cash or other benefits which it believes will be available from the other firm. the organization will buy back their own stock from an investor who threatened a hostile takeover. the two firms were direct competitors before the merger and now will not compete with each other after the merger.

Canada's GDP in 2012 was about $575 billion. $1 trillion. $1.7 trillion. $2.8 trillion. $8.3 trillion.

The national debt refers to the total amount of money that Canada owes to its creditors. the ratio of Canada's exports to its imports. the result of government spending more in a year than the value of GDP. the excess amount of taxes over what the government spends in one year. the amount of taxes the government collects in one year.

Purchasing power parity gives us a good idea of what people are buying outside their own country while on vacation or while doing international business. what people can actually buy with the financial resources allocated to them by their economic system. what people would like to buy with the financial resources in their economic system. purchasing trends across the globe. average annual income.

Marquand says: Information technology has had its biggest impact on business in communication and access to data. With the networking and streamlined communication modalities now available to businesses, businesses can collaborate with each other as well as within a business at different locations with the greatest of ease. Businesses also have access to a greater range of information and at a greater speed than ever before. And with this information being constantly updated, businesses now have the ability to plan in response to market conditions with much greater efficiency than before. Stevenson responds: Information is important, but what's most important is how that information is used. And there is no more direct way that information technology has helped businesses than the ability to sell directly. Selling online has opened up entirely new markets that allow businesses to make greater profits, with greater efficiency, than ever before. Many businesses, such as Amazon, have been able to use online selling exclusively to dramatic effect: without having to spend money on bricks-and-mortar storefronts, they can make billions in profits selling products at low prices. Which of the following, if true, would best support Marquand's position? Having information to help it plan gives a business the greatest competitive edge. Information technology has given consumers more choices than ever before. The majority of consumers make at least one online purchase per month. Information technology has greatly increased the choices available to consumers. Most businesses are motivated to take advantage of the latest information technology.

________ includes human knowledge, work methods, physical equipment, electronics and telecommunications, and various processing systems that are used in performing business activities. The technological environment The social environment The political‒legal environment The competitive environment The economic environment

Prevailing economic conditions will affect the performance of almost every business.

Which of the following is correct regarding unemployment rates in Canada? Unemployment rates have been fairly stable at about 6 percent for the last 30 years. Unemployment rates have been fairly stable at about 2 percent for the last 30 years. Unemployment rates for women have generally been slightly lower than unemployment rates for men. The government did not keep track of unemployment rates for women until the 1980s. The unemployment rate for women is about half the unemployment rate for men.