Deck 1: The Power of Principles: an Historical Perspective

Question 1

What was the most significant development to the evolution of business circa 1910?

A) Railroad integration
B) Telegraph communication expansion
C) Banking and accounting standard practices
D) Mass-production technology
E) Advent of steam technology in railroads and shipping

Answer 1

D

Question 2

What caused the market conditions facing the telephone to be uncertain until the 1880's?

A) Patent conflicts
B) Technology problems due to unstable electricity supplies
C) Dissimilar technologies limiting interconnections between cities
D) Different state laws limiting interstate expansion
E) The high cost fo some components needed to manufacture telephones

Answer 2

A

Question 3

What caused railway transportation to remain the primary transportation source over trucking until World War II?

A) The country lacked of an interstate highway system
B) Rail consolidation was more extensive
C) Rail was faster, safer and more reliable
D) Railroads could carry goods a further distance
E) Companies preferred rail transportation for their goods

Answer 3

A

Question 4

What was a key contribution to the dominance of the family-run small business in 1840?

A) Factories
B) Infrastructure
C) Raw Materials
D) Management
E) Laws

Question 5

What significant government infrastructure project led to the development of national stock and commodity markets?

A) Transcontinental Railroad
B) Erie Canal
C) Union Pacific Railroad
D) Prime Meridian Conference
E) Central Pacific Railroad

Question 6

What does it mean for a manufacturing firm to vertically integrate?

A) Expand using established product technologies to offer a wider variety of products
B) Reorganize management into semi-autonomous divisions
C) Produce raw materials and distribute finished goods on their own
D) Geographic distance between buyers and sellers
E) Use management consultants to optimize processes

Question 7

Which of the following government regulations on business conditions did not increase circa 1910?

A) Regulation on corporate governance
B) Securities markets regulation
C) Antitrust regulation
D) Regulations on disability insurance provisions
E) Regulations on insurance for widows and children

Question 8

What mode of long-distance communication first laid the groundwork for today's modern communication forms?

A) U.S. Postal Service
B) Private mail service
C) Telegraph
D) Telephone
E) Railroad

Question 9

What was one of the first plant/factory types to use the "American System" of manufacturing?

A) Firearms
B) Steel
C) Oil
D) Automobiles
E) Chemicals

Question 10

What firm is generally regarded as being the first to extensively use mass production processes?

A) IBM
B) Burroughs
C) Remington Rand
D) Ford
E) Sears

Question 11

What was the major role of private banks in the early 1800s?

A) Serve as an institution for deposits
B) Issue credit
C) Reduce the risk of price fluctuation
D) Create futures markets
E) Sell stocks

Question 12

What form of communication was integral to the growth of multistory headquarter buildings?

A) Telegraph
B) Mail
C) Telephone
D) Morse code
E) Intercom

Question 13

What economics game theory concept is demonstrated by the Erie Canal public works project?

A) Nash equilibrium
B) Lock-in
C) Backwards induction
D) Fair division
E) Prisoner's dilemma

Question 14

What is throughput?

A) The movement of inputs and outputs through a production process
B) Assets that assist in the production or distribution of goods and services
C) A condition that determines the horizontal and vertical boundaries of business firms
D) An investment in the acquisition of raw materials
E) The amount of time for a good to travel between metropolitan areas

Question 15

What significant transportation event brought about the first significant growth of the Great Lakes region?

A) Harnessing of the steam engine
B) Invention of the screw propeller
C) Opening of the Erie Canal
D) Integration of railway system
E) Invention of the railway system

Question 16

Matchmakers between manufacturers and sellers are called:

A) Agents
B) Factors
C) Brokers
D) Merchants
E) None of the Above

Question 17

Which of the following led to overbuilding of railroads in the 1860's and 1870's?

A) Reduction of taxes on railroads by the federal government
B) The success of railroads in Europe
C) The availability of financing due to public optimism
D) The low cost of labor to construct railroads
E) Increases in regulated freight rates by the Interstate commerce Commission

Question 18

Which of the following led to the development of the financial infrastructure pre- 1910?

A) The use of "Hollerith" or punched cards to storm information
B) The systemization and circulation of credit information
C) The telephone allowing consumers to easily apply for credit
D) The passage of the Federal Fair Credit practices Act
E) None of the above

Question 19

What is the accounting concept inventory turnover as developed by Sears in the late 19ᵗʰ century?

A) To systemize and circulate credit information
B) To manage the requirements of operating efficiencies
C) To publicly disclose the details of a firm's operations
D) To present the payment of dividends out of profits
E) To link profits to fluctuations in sales volume

Question 20

Which of the following did not contribute to the high transaction related risks for U.S.potato sales in 1840?

A) Infrequency of transactions
B) Changing transaction partners
C) Lack of availability of sales and prices for comparable goods
D) Competition from European merchants
E) Geographic distance between buyers and sellers

Question 21

Which of the following encouraged firms to develop through internal R&D rather than through M&A in the 20ᵗʰ century?

A) Lower wage costs for internal labor compared to merged or acquired labor
B) Faster results obtained with R&D
C) Federal antitrust policies
D) Lack of financial capital to engage in M&A
E) High transactions costs associated with M&A activity.

Question 22

What is a benefit of alliances and joint ventures over mergers and acquisitions?

A) Better organizational structure
B) Scale savings
C) Less vertical integration
D) Less horizontal integration
E) Lower likelihood of antitrust scrutiny

Question 23

What was a key factor that aided foreign steel producers in penetrating U.S.markets?

A) Shifting demand in the economy to "lighter" products
B) Invention of the basic oxygen furnace
C) Development of the continuous casting process
D) U.S. steelmakers' commitment to "light" products
E) Development of the electric arc furnace

Question 24

What is a key issue facing managers of the 2000s with respect to production technology?

A) Using the technology while maintaining an adequate level of complexity vs. simplicity
B) Balancing price of the technology with the benefits of its use
C) The choice between reformulating strategies and reorganizing or using the technologies for incremental improvements
D) Integrating CAD/CAM into their factories
E) Ensuring all parties understand the technology

Question 25

By simultaneously halting air traffic and financial markets,what recent historical event highlighted the interdependence company infrastructure?

A) 2000 Presidential Election
B) 2004 Olympics
C) Fall of Enron
D) September 11, 2001
E) Hurricane Katrina

Question 26

How has Atlanta been able to grow as a center of commerce despite its poor water and rail connections?

A) Widespread air transportation
B) New government regulations
C) Improved Financing
D) Better Communications
E) Better technology and innovation

Question 27

What is the gaizhi process?

A) Valuing assets according to their earnings
B) A state-owned enterprise and private enterprise entering a joint venture
C) An increase of profitability prior to sale
D) Acquisition of large firms by private organizations
E) Restructuring whereby small firms are leased or sold

Question 28

How have late 20ᵗʰ and 21ˢᵗ century communications technologies directly created global markets from products and services?

A) Created paperless communications
B) Created seamless and instantaneous communications
C) Decreased coordination for interfirm alliances
D) Increased worker productivity
E) Unflattened the world

Question 29

Which of the following facets of modern financial infrastructure came as a result of deregulation in the 1970s and 1980s?

A) Separation of commercial and investment banking
B) Enhanced role of central banks
C) Increased regulation of securities markets
D) Supply of debt and equity funding for firms that could not fund themselves through retained earnings
E) The availability of large investment funds facilitating M&A to flourish

Question 30

Relaxing of government regulation of economic activities occurred during the second half of the 20ᵗʰ century for all of the following except:

A) Airline industry
B) Workplace safety
C) Banking industry
D) Trucking
E) Healthcare industry