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

Nolivia is a small and poor nation, but its current president has a genuine desire to create more wealth for Nolivia citizens. The president has received recommendations from several of her advisors. Which of the following recommendations is likely to create the most wealth for Nolivia?

The major difference between businesses and nonprofit organizations is that only businesses can increase the standard of living, while only nonprofit organizations can improve the quality of life.

Sarah is a recent U.S. college graduate who is interested in starting an import tea business. If she follows through with her plans, she will be a pioneer, because only a handful of women choose to start businesses in the U.S.

Countries with an inadequately trained work force and few entrepreneurs often achieve the highest levels of income by relying on a large number of workers.

A New York Times article about Bernie Madoff and his illegal Ponzi scheme stated, "When money goes global, fraud does too." Although the goal of investors who trusted Madoff's investment company was to earn the highest return possible on their investments, they turned a blind-eye toward the fact that some of those returns were too good to be true. Individual investors, companies, and even charities lost large sums of money by investing with Madoff's company. Which of the following statements relates to this story?

Successful firms follow a customer-driven strategy, as opposed to the management-driven strategy used in the past.

Greening refers to:

The failure to uphold high ethical business standards by a few companies can negatively impact the entire U.S. business community.

Insourcing refers to the practice of global companies setting up design and production facilities in the United States.

The evidence for climate change is questionable. Well-known U.S. companies are taking a wait-and-see approach toward addressing climate change.

Although employment in the service sector has increased rapidly in recent years, the vast majority of workers are still employed in the goods producing sector.

As you consider the factors of production, which of the following did management theorist, Peter Drucker believe to be one of the most important contributing factors to increasing our nation's wealth?

Public schools, charities and government agencies generally ___________.

Outsourcing has caused many complications in many states where jobs have been lost to overseas companies.

Empowerment means giving frontline workers the responsibility, authority, and freedom to respond quickly to customer requests.

It was 8:00 a.m. on Saturday morning. Liz just learned that her well-meaning cousins were headed over to help her unpack her household. She had just moved back to Chicago from the west coast. Were they really planning to work, or were they expecting brunch? A bagel and pastry shop was just up the road. She would call in a food order. When she arrived to pick up, it was not what she ordered. The store associate quickly made it right, and offered an extra dozen bagels to make-up for the mistake. There was no need to check with the supervisor, as the employee was _______________ to make decisions that translate into good customer service.

Jane's income has remained stable over the past few years while the prices of things she buys have gone up. Nevertheless, Jane feels better off because the environment is cleaner, the crime rate has declined, she has more leisure time, and the quality of medical care has improved. If Jane's experience is typical, we can conclude that the standard of living has:

Businesses and nonprofit organizations often strive to accomplish the same objectives.

Businesses use demographic studies to understand where people live, their lifestyles, and what they are likely to buy.

Which of the following best describes recent job growth in the service sector?