Question 1

_______________ is/are the external and internal circumstances that surround the business.

Accepted Answer

A)  The business environment 
B)  The factors of production 
C)  The business corral 
D)  The business disciplines 
A)  The business environment 
B)  The factors of production 
C)  The business corral 
D)  The business disciplines

Question 2

High taxes and government restrictions help to encourage entrepreneurs by providing greater incentives for people to work hard and create profit.

Accepted Answer

A) True 
 B)False

Question 3

When corruption is present in the business environment:

Accepted Answer

A)  company leaders can threaten competitors and minimize competition. 
B)  factories are easier to build without a government permit. 
C)  it promotes fair competition. 
D)  laborers can make more money. 
A)  company leaders can threaten competitors and minimize competition. 
B)  factories are easier to build without a government permit. 
C)  it promotes fair competition. 
D)  laborers can make more money.

Question 4

Businesses provide goods, jobs, and services to others.

Accepted Answer

A) True 
 B)False

Question 5

Robin has started her own online consulting firm. While she recognizes the risks involved in operating a business, she is still willing to invest her time, effort, and money in hopes of earning a profit. Robin is an example of an entrepreneur.

Accepted Answer

A) True 
 B)False

Question 6

Diversity groups identified in the market today can include extroverts, introverts, atheists, and the devout.

Accepted Answer

A) True 
 B)False

Question 7

Several years ago, the government of the small nation of Allegro owned the nation's telephone company and landlines. This relatively poor government relied on taxes to develop this industry and provide service to its citizens. If the government desired to rapidly improve people's access to phone service, its best course of action would involve selling the telephone company to private investors.

Accepted Answer

A) True 
 B)False

Question 8

With the emergence of the Internet, Jasmine finds it easy to do all her gift buying online. She takes comfort in the fact that new technologies if installed properly are seldom used in unethical ways.

Accepted Answer

A) True 
 B)False

Question 9

Ross wants to invest some money that he just inherited. He found that his bank offers a savings account paying a guaranteed .5% rate of return. However, he would like to earn a higher return. Ross should keep in mind that to earn a higher return on his money he:

Accepted Answer

A)  will have to invest overseas. 
B)  should invest in a business that has a very stable and predictable rate of return. 
C)  will probably have to accept a higher level of risk. 
D)  will probably have to engage in illegal activities. 
A)  will have to invest overseas. 
B)  should invest in a business that has a very stable and predictable rate of return. 
C)  will probably have to accept a higher level of risk. 
D)  will probably have to engage in illegal activities.

Question 10

Business consultant Peter Drucker said that the most important factor of production is knowledge.

Accepted Answer

A) True 
 B)False

Question 11

Employers provide tools and technology for their employees in order to:

Accepted Answer

A)  increase the cost of production and profitability. 
B)  improve their efficiency and productivity. 
C)  reduce corruption in business and eliminate scandals. 
D)  encourage the private ownership of businesses. 
A)  increase the cost of production and profitability. 
B)  improve their efficiency and productivity. 
C)  reduce corruption in business and eliminate scandals. 
D)  encourage the private ownership of businesses.

Question 12

Increases in productivity have allowed fewer farmers to feed more and more people.

Accepted Answer

A) True 
 B)False

Question 13

Maintaining a competitive advantage is very important to the success of today's businesses. All of the following strategies will help a firm remain competitive, except:

Accepted Answer

A)  ignoring competitor movements, including new products and services offered by the competition. 
B)  restructuring internal processes, including the elimination of some jobs. 
C)  spending funds on customer service training for front-line employees. 
D)  adhering to a vision of employee empowerment and striving to exceed customer expectations. 
A)  ignoring competitor movements, including new products and services offered by the competition. 
B)  restructuring internal processes, including the elimination of some jobs. 
C)  spending funds on customer service training for front-line employees. 
D)  adhering to a vision of employee empowerment and striving to exceed customer expectations.

Question 14

In recent years, manufacturing firms in the U.S. have laid off workers. The best explanation of this trend is that:

Accepted Answer

A)  firms have been trying to weaken unions by reducing their reliance on labor. 
B)  workers in the U.S. have become less productive and are no longer able to compete in the global economy. 
C)  firms in many industries have become so efficient that they need fewer workers. 
D)  the economy has been in a prolonged depression that has lasted more than a decade. 
A)  firms have been trying to weaken unions by reducing their reliance on labor. 
B)  workers in the U.S. have become less productive and are no longer able to compete in the global economy. 
C)  firms in many industries have become so efficient that they need fewer workers. 
D)  the economy has been in a prolonged depression that has lasted more than a decade.

Question 15

Which of the following predictions about the impact of e-commerce on traditional businesses is likely to be most accurate?

Accepted Answer

A)  E-commerce will have little impact on most traditional businesses, because only a few types of products can be sold effectively over the Internet. 
B)  Traditional brick-and-mortar firms will enter the e-commerce market by creating their own web sites. 
C)  E-commerce will prove to be very successful in competing against traditional firms in B2C markets, but will have much less success in B2B markets. 
D)  Brick-and-mortar businesses will cease to exist within twenty years. 
A)  E-commerce will have little impact on most traditional businesses, because only a few types of products can be sold effectively over the Internet. 
B)  Traditional brick-and-mortar firms will enter the e-commerce market by creating their own web sites. 
C)  E-commerce will prove to be very successful in competing against traditional firms in B2C markets, but will have much less success in B2B markets. 
D)  Brick-and-mortar businesses will cease to exist within twenty years.

Question 16

Working as an entrepreneur is the only way to succeed in business.

Accepted Answer

A) True 
 B)False

Question 17

Stakeholders include customers, employees, stockholders, suppliers, dealers, bankers, government officials and environmentalists.

Accepted Answer

A) True 
 B)False

Question 18

Adam Ripley sells custom bicycles. Adam buys several bike parts including wheels and tires from the Good Treads Company. Although several government-supported regulations help Adam in his business, regulations that make it easy for Adam's business to enjoy good vendor relationships are:

Accepted Answer

A)  lower taxes that business to business customers pay to each other. 
B)  laws that permit minimal corruption in banking institutions. 
C)  laws that permit small businesses to use the government as an intermediary when doing business with other small businesses. 
D)  laws that support enforceable contracts between firms. 
A)  lower taxes that business to business customers pay to each other. 
B)  laws that permit minimal corruption in banking institutions. 
C)  laws that permit small businesses to use the government as an intermediary when doing business with other small businesses. 
D)  laws that support enforceable contracts between firms.

Question 19

Starting a business is a riskier path toward business success than working your way up the ranks of a large business.

Accepted Answer

A) True 
 B)False

Question 20

An increase in productivity indicates that more can be produced in a given time period with the same amount of resources.

Accepted Answer

A) True 
 B)False

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

_______________ is/are the external and internal circumstances that surround the business.

High taxes and government restrictions help to encourage entrepreneurs by providing greater incentives for people to work hard and create profit.

When corruption is present in the business environment:

Businesses provide goods, jobs, and services to others.

Robin has started her own online consulting firm. While she recognizes the risks involved in operating a business, she is still willing to invest her time, effort, and money in hopes of earning a profit. Robin is an example of an entrepreneur.

Diversity groups identified in the market today can include extroverts, introverts, atheists, and the devout.

With the emergence of the Internet, Jasmine finds it easy to do all her gift buying online. She takes comfort in the fact that new technologies if installed properly are seldom used in unethical ways.

Ross wants to invest some money that he just inherited. He found that his bank offers a savings account paying a guaranteed .5% rate of return. However, he would like to earn a higher return. Ross should keep in mind that to earn a higher return on his money he:

Business consultant Peter Drucker said that the most important factor of production is knowledge.

Employers provide tools and technology for their employees in order to:

Increases in productivity have allowed fewer farmers to feed more and more people.

Maintaining a competitive advantage is very important to the success of today's businesses. All of the following strategies will help a firm remain competitive, except:

In recent years, manufacturing firms in the U.S. have laid off workers. The best explanation of this trend is that:

Which of the following predictions about the impact of e-commerce on traditional businesses is likely to be most accurate?

Working as an entrepreneur is the only way to succeed in business.

Stakeholders include customers, employees, stockholders, suppliers, dealers, bankers, government officials and environmentalists.

Adam Ripley sells custom bicycles. Adam buys several bike parts including wheels and tires from the Good Treads Company. Although several government-supported regulations help Adam in his business, regulations that make it easy for Adam's business to enjoy good vendor relationships are:

Starting a business is a riskier path toward business success than working your way up the ranks of a large business.

An increase in productivity indicates that more can be produced in a given time period with the same amount of resources.

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 Union and 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

Managing the Marketing Mix: Product, Price, Place and Promotion

Extension: Working Within the Legal Environment

Extension: Using Technology to Manage Information

Extension: Managing Risk

Extension: Managing Personal Finances

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