Question 1

Which of the following is an example of a horizontal merger?

Accepted Answer

A) The purchase of a catering firm by Delta Airlines 
B) The purchase of Marathon Oil Company by U.S.Steel 
C) The purchase of Kentucky Fried Chicken by PepsiCo 
D) The purchase of Sam's Meat Packing Company by the Kroger supermarket chain 
E) The purchase of Mobil Oil by Exxon 
A) The purchase of a catering firm by Delta Airlines 
B) The purchase of Marathon Oil Company by U.S.Steel 
C) The purchase of Kentucky Fried Chicken by PepsiCo 
D) The purchase of Sam's Meat Packing Company by the Kroger supermarket chain 
E) The purchase of Mobil Oil by Exxon E

Question 2

As a limited partner in a construction business, Joe

Accepted Answer

A) has input only on major company decisions. 
B) contributes only his time and not his money. 
C) does not receive any portion of the profits. 
D) only risks his initial investment. 
E) cannot lose his investment in the partnership. 
A) has input only on major company decisions. 
B) contributes only his time and not his money. 
C) does not receive any portion of the profits. 
D) only risks his initial investment. 
E) cannot lose his investment in the partnership. D

Question 3

Kerry wants to start a business to sell handmade jewelry. She is very competent at making the jewelry and teaching others to make it, and she has saved a reasonable amount of money to start the business. Who of the following would make the best partner for Kerry?

Accepted Answer

A) Bailey, an artist with a real flair for new-age jewelry design 
B) Ashley, Kerry's best friend who is fun to hang out with and good at solving problems 
C) Natalie, who has business experience with accounting, management, and marketing 
D) Janette, who used to work at the jewelry counter at a department store 
E) Darla, an engineer with industrial management experience but no money 
A) Bailey, an artist with a real flair for new-age jewelry design 
B) Ashley, Kerry's best friend who is fun to hang out with and good at solving problems 
C) Natalie, who has business experience with accounting, management, and marketing 
D) Janette, who used to work at the jewelry counter at a department store 
E) Darla, an engineer with industrial management experience but no money C

Question 4

Describe the ownership, operation, and size of a sole proprietorship.

Accepted Answer

A sole proprietorship is owned by one pe

Question 5

Local residents have always thought the mom-and-pop store on the corner of Locust and Congress was a partnership between Mr. and Mrs. Jones. But Mr. Jones is the real owner. This probably means that the store is a

Accepted Answer

A) limited partnership. 
B) sole proprietorship. 
C) corporation. 
D) cooperative. 
E) joint venture. 
A) limited partnership. 
B) sole proprietorship. 
C) corporation. 
D) cooperative. 
E) joint venture.

Question 6

B&G, Inc.
A year ago, Kevin went to work for B&G, Inc. He has worked for the finance department ever since he started. He noticed that the corporation was only taxed as though it were a partnership. This was something that he found very odd when he first started working for the company, but he later realized it was a fairly common practic
While the job was challenging, Kevin was not happy. He wanted to work for a company whose main goal was to provide service to the community, not to make a profit. However, Kevin felt that, considering his present financial situation, he had to continue working for B&G, Inc. A week later, Kevin discovered there was going to be a merger between B&G, Inc. and one of its major competitors. Kevin's boss informed him that he would be getting a promotion and a rais
-Refer to B&G, Inc. B&G, Inc. was going through a ____ merger.

Accepted Answer

A) vertical 
B) horizontal 
C) conglomerate 
D) hostile 
E) leveraged 
A) vertical 
B) horizontal 
C) conglomerate 
D) hostile 
E) leveraged

Question 7

All of the following are advantages of the partnership form of organization except

Accepted Answer

A) unlimited liability. 
B) retention of profits. 
C) combined skills and knowledge. 
D) better access to capital and credit. 
E) ease of start-up. 
A) unlimited liability. 
B) retention of profits. 
C) combined skills and knowledge. 
D) better access to capital and credit. 
E) ease of start-up.

Question 8

Mark owns stock in Walgreens. He has the right to vote on company issues and examine corporate records, and he receives dividends from Walgreens' profits. What type of stock does Mark own?

Accepted Answer

A) Common 
B) "A" class 
C) Proxy 
D) Dividend 
E) Preferred 
A) Common 
B) "A" class 
C) Proxy 
D) Dividend 
E) Preferred

Question 9

Mike Nettles approached Nathan Lang about becoming a partner in a firm that destroys environmental waste. While Mike would like to become a partner in the firm, he is concerned about his liability because he has recently inherited a lot of money. In this situation, Mike should become a

Accepted Answer

A) general partner with a majority ownership interest in the business. 
B) general partner with a minority ownership interest in the business. 
C) limited partner. 
D) joint venturist. 
E) sole proprietor. 
A) general partner with a majority ownership interest in the business. 
B) general partner with a minority ownership interest in the business. 
C) limited partner. 
D) joint venturist. 
E) sole proprietor.

Question 10

Describe the merger trends affecting American business.

Accepted Answer

Most experts predict that mergers and ac

Question 11

When many banks join together to lend money to developing countries such as Bangladesh and Malaysia, they seek to spread out the risk of default. This is called

Accepted Answer

A) a not-for-profit organization. 
B) a cooperative. 
C) diversification. 
D) a quasi-government corporation. 
E) a syndicate. 
A) a not-for-profit organization. 
B) a cooperative. 
C) diversification. 
D) a quasi-government corporation. 
E) a syndicate.

Question 12

In the state in which it is incorporated, a business is known as a(n)

Accepted Answer

A) S-corporation. 
B) resident corporation. 
C) public corporation. 
D) foreign corporation. 
E) domestic corporation. 
A) S-corporation. 
B) resident corporation. 
C) public corporation. 
D) foreign corporation. 
E) domestic corporation.

Question 13

Corporate officers are elected by the stockholders.

Accepted Answer

A) True 
 B)False

Question 14

What types of information should a partnership agreement contain?

Accepted Answer

A partnership agreement should generally

Question 15

Because of limited liability, individuals are more willing to invest in corporations than in other forms of business.

Accepted Answer

A) True 
 B)False

Question 16

A ____ invests money in the business but has no management responsibility.

Accepted Answer

A) general partner 
B) limited partner 
C) sole proprietor 
D) nominal partner 
E) stockbroker 
A) general partner 
B) limited partner 
C) sole proprietor 
D) nominal partner 
E) stockbroker

Question 17

Which of the following is an advantage of a sole proprietorship?

Accepted Answer

A) The owner has unlimited liability. 
B) The business ceases to exist when the owner dies. 
C) There is a limit to the amount one person can borrow. 
D) Profits are taxed as individual income. 
E) The owner enjoys lack of continuity. 
A) The owner has unlimited liability. 
B) The business ceases to exist when the owner dies. 
C) There is a limit to the amount one person can borrow. 
D) Profits are taxed as individual income. 
E) The owner enjoys lack of continuity.

Question 18

A distribution of earnings to the stockholders of a corporation is a(n)

Accepted Answer

A) par distribution. 
B) dividend. 
C) earnings per share. 
D) distributed payment. 
E) common payment. 
A) par distribution. 
B) dividend. 
C) earnings per share. 
D) distributed payment. 
E) common payment.

Question 19

Surplus funds of a not-for-profit organization are distributed to members of the board of directors.

Accepted Answer

A) True 
 B)False

Question 20

Most partnerships have ____ partners.

Accepted Answer

A) two 
B) three 
C) four 
D) five 
E) more than five 
A) two 
B) three 
C) four 
D) five 
E) more than five

Which of the following is an example of a horizontal merger?

As a limited partner in a construction business, Joe

Kerry wants to start a business to sell handmade jewelry. She is very competent at making the jewelry and teaching others to make it, and she has saved a reasonable amount of money to start the business. Who of the following would make the best partner for Kerry?

Describe the ownership, operation, and size of a sole proprietorship.

Local residents have always thought the mom-and-pop store on the corner of Locust and Congress was a partnership between Mr. and Mrs. Jones. But Mr. Jones is the real owner. This probably means that the store is a

All of the following are advantages of the partnership form of organization except

Mark owns stock in Walgreens. He has the right to vote on company issues and examine corporate records, and he receives dividends from Walgreens' profits. What type of stock does Mark own?

Mike Nettles approached Nathan Lang about becoming a partner in a firm that destroys environmental waste. While Mike would like to become a partner in the firm, he is concerned about his liability because he has recently inherited a lot of money. In this situation, Mike should become a

Describe the merger trends affecting American business.

When many banks join together to lend money to developing countries such as Bangladesh and Malaysia, they seek to spread out the risk of default. This is called

In the state in which it is incorporated, a business is known as a(n)

Corporate officers are elected by the stockholders.

What types of information should a partnership agreement contain?

Because of limited liability, individuals are more willing to invest in corporations than in other forms of business.

A ____ invests money in the business but has no management responsibility.

Which of the following is an advantage of a sole proprietorship?

A distribution of earnings to the stockholders of a corporation is a(n)

Surplus funds of a not-for-profit organization are distributed to members of the board of directors.

Most partnerships have ____ partners.

Exploring the World of Business and Economics

Being Ethical and Socially Responsible

Exploring Global Business

Small Business, Entrepreneurship, and Franchises

Understanding the Management Process

Creating a Flexible Organization

Producing Quality Goods and Services

Attracting and Retaining the Best Employees

Motivating and Satisfying Employees and Teams

Building Customer Relationships Through Effective Marketing

Creating and Pricing Products That Satisfy Customers

Distributing and Promoting Products

Understanding Social Media and E-Business

Using Management Information Systems and Accounting Information

Mastering Financial Management

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Exam 4: Choosing a Form of Business Ownership

Which of the following is an example of a horizontal merger?

As a limited partner in a construction business, Joe

Kerry wants to start a business to sell handmade jewelry. She is very competent at making the jewelry and teaching others to make it, and she has saved a reasonable amount of money to start the business. Who of the following would make the best partner for Kerry?

Describe the ownership, operation, and size of a sole proprietorship.

Local residents have always thought the mom-and-pop store on the corner of Locust and Congress was a partnership between Mr. and Mrs. Jones. But Mr. Jones is the real owner. This probably means that the store is a

All of the following are advantages of the partnership form of organization except

Mark owns stock in Walgreens. He has the right to vote on company issues and examine corporate records, and he receives dividends from Walgreens' profits. What type of stock does Mark own?

Mike Nettles approached Nathan Lang about becoming a partner in a firm that destroys environmental waste. While Mike would like to become a partner in the firm, he is concerned about his liability because he has recently inherited a lot of money. In this situation, Mike should become a

Describe the merger trends affecting American business.

When many banks join together to lend money to developing countries such as Bangladesh and Malaysia, they seek to spread out the risk of default. This is called

In the state in which it is incorporated, a business is known as a(n)

Corporate officers are elected by the stockholders.

What types of information should a partnership agreement contain?

Because of limited liability, individuals are more willing to invest in corporations than in other forms of business.

A ____ invests money in the business but has no management responsibility.

Which of the following is an advantage of a sole proprietorship?

A distribution of earnings to the stockholders of a corporation is a(n)

Surplus funds of a not-for-profit organization are distributed to members of the board of directors.

Most partnerships have ____ partners.

Exploring the World of Business and Economics

Being Ethical and Socially Responsible

Exploring Global Business

Small Business, Entrepreneurship, and Franchises

Understanding the Management Process

Creating a Flexible Organization

Producing Quality Goods and Services

Attracting and Retaining the Best Employees

Motivating and Satisfying Employees and Teams

Building Customer Relationships Through Effective Marketing

Creating and Pricing Products That Satisfy Customers

Distributing and Promoting Products

Understanding Social Media and E-Business

Using Management Information Systems and Accounting Information

Mastering Financial Management

Filters