Deck 1: Business Basics

Question 1

Profits allow a company to ________.

A) increase productivity
B) lower employee wages
C) reduce its span of operations
D) disregard concern about expenses
E) lower standards of living for the entire society

Answer 1

A

Question 2

Jose called an electrician to repair some appliances in his home.Which of the following terms BEST describes the electrician's repairs?

A) a service
B) a good
C) a benefit
D) an appointment
E) a liability

Answer 2

A

Question 3

The various resources used to create a company's goods and services are collectively referred to as ________.

A) raw materials
B) factors of production
C) supplies
D) inventory
E) intellectual property

Answer 3

B

Question 4

Emma bought an MP3 player and a portable DVD player.These products are called goods because ________.

A) they do a good job of satisfying a customer's needs
B) they are physical or tangible products
C) they are produced in an economical offshore factory
D) they can be sold either in a store or online
E) they are good at increasing a company's profit margin

Question 5

Which of the following is NOT a benefit of business competition?

A) It may lead to a wider variety of goods and services.
B) It may lead to higher quality goods and services.
C) It may lead to a limited variety of goods and services.
D) It may lead to cheaper goods and services.
E) It may lead to decreased customer satisfaction.

Question 6

The economy of the United States is ________.

A) market-based
B) government-owned
C) socialistic
D) not-for-profit
E) noncompetitive

Question 7

Nina's furniture store has had a successful year and made a significant profit.Which of the following actions using Nina's store profits would BEST increase productivity?

A) Pay for utilities and inventory in advance.
B) Develop a website that would enable customers to place orders online.
C) Hire more staff.
D) Create an emergency fund.
E) Service her community through social and educational means.

Question 8

Teresa and Luis are getting married next month.Which of the following elements of their wedding does NOT require a natural resource for its production?

A) the wedding rings
B) the wedding vows
C) the wedding cake
D) the bridesmaids' dresses
E) the table centerpieces

Question 9

Melinda is a store owner who buys items online to sell in her shop.Which of the following factors of production is BEST illustrated in Melinda's use of the Internet?

A) capital
B) labor
C) technology
D) entrepreneurs
E) natural resources

Question 10

Which of the following would MOST likely happen to companies that are less efficient than their competitors?

A) They would continue to do business as usual.
B) They would close down.
C) They would be taken over by the government.
D) They would receive additional money from investors.
E) They would become a target for a hostile takeover.

Question 11

Labor is a factor of production that refers to any physical or ________ work people contribute to a business's production.

A) intellectual
B) emotional
C) unionized
D) entrepreneurial
E) technological

Question 12

Which of the following statements is true of a not-for-profit organization?

A) It makes profits.
B) It does not pay expenses.
C) It can earn excess revenue.
D) It cannot operate like a business.
E) It rewards the proprietor of the organization with earned profits.

Question 13

Which of the following BEST describes competition?

A) Two or more companies compete with one another for greater federal, state, and local subsidies.
B) Two or more companies compete with one another to attract customers and gain an advantage.
C) Two or more companies compete with one another to maintain a monopoly.
D) Two or more companies complete with one another to influence trade policy.
E) Two or more companies compete with one another to limit the variety of goods and services.

Question 14

Competition affects companies in all of the following ways EXCEPT ________.

A) forcing them to deliver customer satisfaction
B) forcing them to improve their products
C) forcing them to aggressively promote their brands
D) forcing them to lower their prices
E) forcing them to increase their production levels

Question 15

Which of the following is an example of real capital?

A) a business loan
B) computer software
C) natural gas
D) a manufacturing plant
E) personal savings

Question 16

Chris orders a salad at a restaurant.What is the BEST definition of what he is buying?

A) Chris is buying a good.
B) Chris is buying a service.
C) Chris is buying a service, but not a good.
D) Chris is buying neither a good nor a service.
E) Chris is buying both a good and a service.

Question 17

When a company's revenue is greater than its expenses,it means that ________.

A) the company earns a profit
B) the company spends more than it earns
C) the company's income is decreasing
D) the company needs to increase its spending
E) the company must increase its productivity

Question 18

The physical products that a business offers are called ________.

A) goods
B) services
C) assets
D) devices
E) intangible

Question 19

Robert wants to upgrade his real estate company's computer systems.Which of the following factors of production would Robert find LEAST useful for his project?

A) financial capital
B) technology
C) real capital
D) labor
E) human resources

Question 20

Leroy owns a small hardware store that is known for its high level of customer service.A large chain home improvement store has just opened up in his community.Which of the following would BEST help Leroy deal with his new competitor?

A) Pay his employees "under the table" to avoid costly payroll taxes and keep prices lower.
B) Close the business, since small stores cannot compete effectively with chain stores.
C) Advertise aggressively to increase consumer awareness of his reputation for service.
D) Move his store in order to be farther away from the large store.
E) Raise their prices, to show that their customer service is worth paying a premium for.

Question 21

Patricia owns a small electronics store in a rural area.She carries two different brands of weather radios that are equally priced.One model is selling well,but the other does not seem to be attracting customers.What should Patricia do?

A) Stop advertising the radio that is not selling well.
B) Donate the poorly selling radios to local schools.
C) Reduce the price of the model that is not selling well.
D) Try to discourage customers from buying the model that is selling well.
E) See if a rival electronics store will purchase the poorly selling radios.

Question 22

Tom is a college senior who would like to get a "green-collar" job when he graduates.Which of the following positions is he LEAST likely to apply for?

A) a job as a wind turbine engineer
B) a job installing solar panels
C) a job as manager at an oil refinery
D) a job weatherproofing houses
E) a job selling hybrid cars

Question 23

Which of the following is NOT an advantage of technology?

A) streamlines businesses
B) cuts costs
C) fosters a more personal work environment
D) helps employees work more efficiently
E) keeps a company well-connected

Question 24

________ is the movement toward a more interconnected and interdependent world economy.

A) Globalization
B) The green movement
C) Social networking
D) Multiculturalism
E) Diversity initiative

Question 25

Which of the following social issues would LEAST affect the environment in which U.S.businesses operate?

A) an aging American population
B) the popularity of reality television
C) increasing ethnic diversity in the workforce
D) emergence of the green movement
E) diversity initiatives including gender and sexual orientation

Question 26

Globalization is a controversial subject for many people because ________.

A) it allows U.S. companies to import and export goods from anywhere in the world
B) it increases the cost of goods and services in the United States
C) it results in the closing of some U.S. manufacturing facilities
D) it allows companies of any size to compete globally
E) it stabilizes the value of the U.S. dollar

Question 27

Bill is an information technology manager for a large firm.His company needs to install a new software program,which he orders from his company's online supplier.This is an example of ________ e-commerce.

A) business-to-business
B) business-to-customer
C) business-to-consumer
D) business-to-supplier
E) consumer to consumer

Question 28

________ refers to a company's choice to relocate its production facilities overseas or subcontract at least some of the components to foreign companies at low costs.

A) Globalization
B) Diversifying
C) Downsizing
D) Contracting
E) Offshoring

Question 29

Carla wants to start a new software company,but she lives in a remote community where few skilled software programmers live.Which of the following is the BEST cost-effective strategy for building her workforce?

A) Produce only software she can create herself.
B) Use the Internet and other technologies to hire remote employees who want to telecommute.
C) Offer free computer programming training programs to the local workforce.
D) Relocate to an urban area where there are many software programmers.
E) Wait until more software programmers move to the area.

Question 30

"Computers are outdated after three years and obsolete after five." What aspect of technology does that statement BEST represent?

A) Technological innovations can be used to keep a company well-organized.
B) Technological innovation is changing the focus of how many businesses are run.
C) Technological innovation can help streamline businesses and cut costs.
D) Technological innovation is necessary in order to remain competitive.
E) Technological innovation is expensive and time-consuming.

Question 31

Which of the following is NOT a danger to U.S.companies posed by globalization?

A) increased competition from international companies
B) security and patent protection concerns
C) stabilization in the value of the U.S. dollar
D) unstable political climates in foreign countries
E) loss of U.S. jobs due to offshoring

Question 32

Which of the following events would MOST likely change the racial demographic of a population?

A) a political scandal
B) an aging population
C) an economic slump
D) an influx of immigrants
E) the green movement

Question 33

In a business environment,the term "minority" applies to more than just people of different ethnicities.Minority groups represent all of the following EXCEPT ________.

A) a person's political party
B) a person's gender
C) a person's culture
D) a person's sexual orientation
E) a person's disability

Question 34

Which of the following BEST enables all companies,regardless of size,to compete in the global market?

A) effective marketing
B) a talented workforce
C) government subsidies
D) technological advances
E) "green" policies

Question 35

Jarvis runs a restaurant that has had a lot of complaints from customers lately.Jarvis is a strict manager and prefers to make all the decisions himself.A concerned friend recommends that Jarvis delegate more decision-making responsibility to his employees.Which of the following would be the MOST likely result of Jarvis' delegating responsibility?

A) Customers will be upset because the restaurant is being run differently.
B) Customer satisfaction will improve because employees can be more responsive to customer needs.
C) Customer satisfaction will decrease because employees will make the wrong decisions.
D) Employees will quit because of the change in Jarvis' management style.
E) The restaurant will need to increase its prices.

Question 36

Which of the following factors do multinational companies MOST often look for in a country when they are considering a location for offshore manufacturing?

A) a diverse culture
B) strict government regulations
C) low production costs
D) low cost of living
E) unstable political climate

Question 37

Addison wants her new t-shirt store to be environmentally friendly.With the concept of the green economy in mind,which of the following business initiatives would BEST make her business greener?

A) mail out paper fliers advertising her business
B) raise prices to include the cost of a donation to a green nonprofit organization
C) sell t-shirts with environmental slogans
D) install solar panels on her store's roof to provide electricity
E) giving a discount to customers who claim to be environmentally conscious

Question 38

Which of the following refers to an interconnected system of different demographic factors?

A) cultural environment
B) economic environment
C) political environment
D) social environment
E) social networking

Question 39

Which of the following problems is potentially posed by an aging population?

A) higher taxes
B) lower deficit
C) labor surpluses
D) fewer business opportunities
E) decreased demand for social services

Question 40

Which of the following would MOST likely be part of a company's diversity initiative?

A) ethics training
B) a minority network
C) 360-degree feedback
D) corporate history
E) sustainability education

Question 41

Which of these characteristics is NOT applicable to a multinational company?

A) It provides goods or services to international consumers.
B) It may serve only one country but have suppliers or facilities in other countries.
C) Its employees must speak multiple languages.
D) It may adapt its operations to fit the cultures of the countries in which it operates.
E) It is subject only to the laws of the country in which the company originated.

Question 42

Not all businesses provide a product.

Question 43

Which of the following poses the MOST COMMON financial threat to local and regional businesses?

A) employee retention
B) undercapitalization
C) low productivity
D) limited customer base
E) inefficiency

Question 44

Which of these qualities BEST explains why a specialty shop is often classified as a local business?

A) It is not able to borrow funds for expansion.
B) It accepts cash, checks, and credit cards as forms of payment.
C) It is a one-of-a-kind operation and relies on local consumers to generate business.
D) It sells only products that are made locally.
E) It does not need to carry liability insurance.

Question 45

When a business is profitable,the whole society benefits.

Question 46

The WAWA chain of convenience stores has over 500 locations in five states in the mid-Atlantic region of the United States.WAWA is an example of ________.

A) a local business
B) a regional business
C) a national business
D) a state business
E) a specialty business

Question 47

Real capital refers to the money used to facilitate a business enterprise.

Question 48

Car insurance is an example of a good.

Question 49

Your life is similar to a small company in that it requires careful planning,precise record keeping,and ________.

A) a good memory
B) openness to change
C) an outgoing personality
D) physical fitness
E) a current resume

Question 50

A(n)________ is the process by which products,information,and money move between supplier and consumer.

A) operational flow
B) delivery system
C) funneling mechanism
D) supply chain
E) product flow

Question 51

Barbara owns a bakery in Boston.When her business reached a certain level of profit,she decided to open three more bakeries in the area.Many businesses,like Barbara's,are able to expand as they earn more profits.

Question 52

An Old Navy store is an example of a ________ business.

A) national
B) multinational
C) local
D) regional
E) boutique

Question 53

Which of the following is often imposed by governments on multinational companies operating in their countries?

A) laws regarding product diversity
B) laws regarding tax exemptions
C) laws regarding minimal profits
D) laws regarding quality control
E) law regarding promotional strategies

Question 54

The private enterprise system assumes that competition benefits consumers.

Question 55

A university,an inner city health clinic,and a church are all run specifically to generate profits.

Question 56

Who is legally responsible for protecting the privacy of consumer information that businesses store online?

A) Social Security Administration
B) Internal Revenue Service
C) Internet service providers
D) consumers
E) business owners

Question 57

As more profit is generated,a company is able to increase its productivity.

Question 58

Which of the following is an example of how today's social environment may affect individuals' lives?

A) It may help them learn from people who are different from them.
B) It may help them afford less energy-efficient cars.
C) It may reduce their taxes as demand for government services declines.
D) It may limit the number of entrepreneurial opportunities.
E) It may lead them to sell items online.

Question 59

Humberto is a supply chain manager for a multinational company.Which of the following challenges should he be LEAST concerned about?

A) His office is missing certain business supplies.
B) Products may get backed up in a long supply chain.
C) There is a lack of communication among companies in the chain.
D) The number of customer returns is very large.
E) Products need to pass through multiple warehouses.

Question 60

To become successful,a company should keep pace with the latest technology.

Question 61

When businesses compete,products usually become more expensive.

Question 62

Local businesses are prone to bankruptcy because they are likely to be undercapitalized.

Question 63

How does social networking affect the competitiveness of a business?

Question 64

Explain how the social environment can affect business.

Question 65

National businesses often serve international markets.

Question 66

Diversity initiatives in businesses are essential to a company's ability to be competitive.

Question 67

Competition arises when two or more businesses contend with one another to attract customers and gain an advantage.

Question 68

Explain the similarities and differences between the different types of capital.

Question 69

Globalization is recognized by all as a force for good in the U.S.economy.

Question 70

How does competition benefit consumers? Provide a business example of competition's ability to provide value to consumers.

Question 71

Providing temporary disability insurance for employees is a federal requirement imposed on companies that operate in the United States.

Question 72

Keeping up with technological advances is an inexpensive way for companies to remain competitive.

Question 73

How do the profits of a single business benefit society in general?

Question 74

What do businesses generally do with profits?

Question 75

Why is technology such an important factor of production?

Question 76

Identify and describe the five factors of production.

Question 77

Baby boomers are an unprofitable demographic target for businesses.

Question 78

Ron plans to open his own café.He wants to offer a variety of coffees,sandwiches,and salads.He also plans to hire employees who will prepare food and serve customers.What type of product would Ron's customers be offered?

Question 79

Grace loves working with children and plans to start a school for children with disabilities.She would like to invest at least some of the money she makes after expenses back into the school.What kinds of organization structures should she consider? How would you recommend that Grace structure her school for legal purposes?

Question 80

In what ways is a multinational corporation,like Google,similar to a local business,such as a Chinese restaurant? In what ways are these two businesses different?