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

Almost all of the growth in employment opportunities since the mid-1980s has been generated by the service sector.

Jay and Jim Spears own a lawn irrigation system business. They perform installations and maintenance of these systems. Several of their customers are golf courses, but they serve a large group of residential customers as well. When they started the business ten years ago, they made a pact to always operate within the legal limits of the law, but lately, the competition is eating them alive. Local competitors have hired illegal immigrants to perform the manual labor. They do not pay taxes on these employees - they just pay them in cash at the end of the week. Employment taxes are a burden for small businesses. Jay and Jim do not want to hire illegal workers. There's a risk if you permit an illegal worker to drive a truck; or, if he/she has an accident on the job. You have just studied business ethics in your class. You inform this partnership that:

One reason given for the decline in the number of U.S. workers employed in manufacturing is that manufacturing firms in the U.S. have become more efficient.

An increase in global trade will:

To realize his passion, Alex recently opened Original Tunes, Inc., a small state of the art recording studio in Nashville, TN. He probably could have set-up shop in several major cities, but Nashville offered him the two most important factors that he learned in business school would enhance the creation of wealth: labor and political freedom.

Honda and Toyota have used insourcing for years to produce cars in the United States. Insourcing:

The most important difference between for-profit businesses and nonprofit organizations is that:

The government of the nation of Winstone is trying to achieve a high quality of life by imposing strict regulations to protect the environment and ensure safe working conditions in factories and mines. The government also has established ambitious programs to help the poor, financing them by setting high tax rates. These efforts by Winstone's government should create an atmosphere that encourages entrepreneurship.

The global environment:

The threat of terrorism more often __________ the cost of operating a business.

Efficiency means:

The statistical study of human population to learn its size, density, and characteristics is called:

Demographic changes create new business opportunities.

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

Traditional businesses have a managerial focus rather than a customer focus.

A common characteristic of most entrepreneurs is that they:

The only way a firm can increase its profits is to increase its sales revenue.

A(n) ____________ is a person who assumes the risk of starting a business.

An activity which seeks to earn a profit by providing a good or service is known as a(n):

Healthcare, insurance, recreation and other intangible products are provided by the: