Often the needs of a firm's various stockholders will conflict. True Or False
Outsourcing means selling goods and services to people in other countries. True Or False?
Businesses and nonprofit organizations often strive to accomplish the same objectives. True Or False?
Nonprofit organizations use financial gains to meet stated social or educational goals of the organization rather than personal profit. True Or False?
The only real purpose of a business is to make money for entrepreneurs. True Or False?
The Threat of Terrorism:
A. benefits most businesses because just about all companies contribute toward averting these threats.
B. will certainly affect companies that participate in global trade, but most large US companies do their business domestically.
C. has improved the quality of life of most people b/c companies employ more workers when the threat is high
D. is costly to most firms b/c its costly to governments who pay taxes to pay for protection.
The Mcnash's bike to school, use cloth bags for groceries, want to grow their own food. They are examples of a growing number of people who:
A. have developed a health concious attitude
B. want to change their lifestyle to be more in tune to saving energy.
C. stay away from urban areas due to increased threats of terrorist attacks in those localities.
D. dislike urban centers and wish to leave the country
Which of the following statements describes a reoccurring theme about today's ecological environment?
A. most ppl agree that there is strong evidence that the temp. of the planet is going down
B. smart businesses know that green business is currently a trend and they should proceed with caution b/c most green initiatives are more costly than wars and education.
C. There is a strong push by customers that business develop products & services that clearly save energy
D. clearly, the greening issue is an American trend
Tyler Samuels who recently returned from Iraq. He is now in the US where he collects the GI Bill in order to go to school. This is an example of:
A. how an event such as war educates young people about conditions abroad.
B. the cost of war
C. the benefits of war on education
D. a squeeze on employer benefits
During the past 150 years, the US has evolved from:
A. an agrarian economy to an information technology economy
B. A business to business economy to a business to consumer economy
C. An agrarian economy to a manufacturing economy, to a service oriented economy.
D. a manufacturing economy to a service economy, to a cottage economy, and now an agrarian economy.
Businesses that sell and produce tangible products such as steel and machines are part of the:
A. manufacturing industry
B. knowledge based industry
C. service industry
D. production sector
The service industry represents_ of the total value of the US economy. A. about 30%
B. under 50%
C. about 70%
Health care, insurance, recreation, and other intangible products are provided by the:
A. global sector
B. service industry
C. industrial sector
D. manufacturing industry
Since the beginning of the 1900's, the agricultural sector of the US has:
A. seen the number of family farms more than double
B. become less and less competitive in the global economy
C. produced a consistent output per farm
D. experienced a significant drop in employment, b/c of tremendous improvements in efficiency.
In recent years, almost all new job creation in the US has occurred in the _ sector:
The new era of business is likely to be dominated by the:
A. service sector
B. information based sector
C. manufacturing sector
D. continued decline in productivity
Appliance repair firms, tax consultants, law firms, and insurance companies are all business firms that are part of the:
A. production sector
B. management sector
C. neo-industrial sector
D. service sector
In recent years, manufacturing firms in the US have laid off workers. The best explanation of this trend is that:
A. firms have been trying to weaken unions by reducing their reliance on labor
B. workers in the US 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
Product differentiation is a key to success in monopolistic competition. True Or False
In the US, laws prohibit the creation of most types of monopolies. True Or False?
One strength of a free market economic system is that it emphasizes the fair and humane treatment of the less fortunate in society. True Or False?
The greed of business people represents one of the greatest dangers to the operation of a free market system. True Or False?
Fetna resides in a country where the economic system is primarily based on free market capitalism. Fetna is likely to have the freedom to buy and sell property. True Or False?
A surplus currently exists for a product called widgets. In a free market system, the government must step in and buy any widgets that consumers do not buy in order to eliminate the surplus and establish equilibrium. True Or False?
In a free market economic system, the lack of government control and regulation means that businesses find it easy to take advantage of customers by offering poor quality products at high prices. True Or False?
Jill owns a bakery. She used to charge $12 for each cheesecake, at this price her customers bought an average of 84 per week. The last few weeks she reduced the price to $10.50 per cake and her customers have purchased about 96 per week. These results are consistent with the economic concept of demand. True Or False?
Monica notices that only a few big companies produce the vast majority of soft drinks. She would be correct in describing the soft drink industry as an oligopoly. True Or False?
Glamour Gal is popular cosmetics company. Due to the fact that its industry faces monopolistic competition, the company knows that it must continue to differentiate itself from the competition. True Or False?
Roland is a nation with an economic system that closely approximates pure capitalism. While Roland's economy is likely to generate a great deal of wealth, it may do a poor job of providing an acceptable level on income for the elderly or disabled. True or false?
In the newspaper this morning, you read about the downfall of a multinational entertainment business, and a report that the company's CEO enjoyed a 9% increase in his salary during the same year that the companies profits were down 35%. Clearly this is an example of how inequality and greed can infiltrate the free market economic system. True or False?
Which of the following would be a topic emphasized in a microeconomics class?
A. how a nations GDP is computed
B. the reason's why the unemployment rate for the economy is rising or falling
C. how market conditions determine the price of a specific product.
D. how the government can use fiscal and monetary policies to stabilize the economy
Together, Reality Entertainment and its three rivals control almost the entire reality TV programming. Their market environment is called:
A. an oligopoly
B. a duopoly
C. monopolistic competition
D. a quasi-monopoly
Which of the following people would tend to favor the socialist economy?
A. John wants to live in a country with low marginal tax rates.
B. Robin wants to live in a country that encourages rapid economic growth.
C. Liz wants to live in a country with limited government regulation
D. Fred prefers to live in a country that promotes social equality
Which of the following indicators provides the clearest indication that an economy is experiencing deflation?
A. a decrease in the unemployment rate
B. A decrease in GDP
C. an increase in the PPI
D. a decrease in the CPI
Senator Gong Lee is alarmed at the state of the economy. unemployment rate is high and GDP is low. Lee wants Congress to take actions to increase its expenditures and cut taxes in order to stimulate the economy. The actions called for by Lee are examples of:
A. monetary policy
B. fiscal policy
C. incomes policy
D. social investment policy
Mcdonalds global sales continue to increase due to its willingness to serve a variety of foods, depending upon the nation where its doing business. True Or False?
One characteristic of an international joint venture is all parties sharing the risk of a major project. True Or False?
A firm desiring to enter a foreign market with a limited investment should consider licensing. True Or False?
When Nestle, a Swiss company, purchased Ralston Purina, a US company, Ralston Purina become a foreign licensee. True Or False?
A firm may export everything it produces overseas and yet not be considered a multinational. True Or False?
Contract manufacturing is a low cost way for GAP to outsource the production of its clothing designs. True Or False?
Strategic alliances almost always result in one company taking over the financial interests of another company. True Or False?
Governments directly participate in global markets through " sovereign wealth funds." True Or False?
The Nissan automobile assembly plant in Tennessee is an example of foreign direct investment in the US. True Or False?
Kodak contracts with a firm in Taiwan to manufacture Kodak digital cameras. This is an example of a joint venture. True Or False?
The job of an ethics officer is to serve as a counselor for employees and an investigator for the company. True Or False?
Enforcement is perhaps the most important step in an effective code of ethics. True Or False?
A code of ethics designed to avoid criminal misconduct is an example of a compliance based ethics code. True Or False?
To be effective, an organizations code of ethics needs to be communicated to outsiders such as suppliers, subcontractors, and customers. True Or False?
Since most ethics violations are small and rather insignificant in nature, employees need to understand that addressing these issues is secondary to making profits. CEOs may be justified in putting these on the back burner for more convenient moments to address them. True Or False?
America's business ethics can improve simply by requiring written contracts with employees, customers, and owners. This alone will do the job! True Or False?
An important step in improving US business ethics is for companies to hire whistle blowers. True Or False?
Dewy Cheatum encourages his employees to create and use legal loopholes to gain a competitive advantage. In keeping within the legal limits of the law, the employees are within their compliance based ethics rights. True Or False?
The brewers of Budweiser beer encourage their customers to drink responsibly and "know when to say when" This reflects a compliance based approach to ethics. True Or False?
Cigarette producers label their products with warnings of potential health hazards. Due to the fact that this is a government mandated disclosure, it is part of the industry's compliance based ethics. True Or False?
Over 60% of all theft in retail stores is committed by employees, New Generations Clothier, Inc., requires that managers personally unlock fitting rooms for all sales associates and count the number of items associates take to the rooms. This policy is written in the company manual. Breaking the policy is grounds for dismissal. It is correct to say that this is part of New Generations compliance based ethics?
At Fast Track Financial Services, it is not unusual for a financial consultant to lose a client to another consultant working out of the same office. Clients have a right to do business with whomever they choose. if it is a high net worth client, with the potential for high commissions on sales, the incentive to steal a fellow co-workers client exists b/c the firm's culture has not established integrity based ethics to deter this activity. True Or False?
Corporate social responsibility refers to the concern businesses have for the welfare of society. True Or False?
"Corporate philanthropy" refers to the position a firm takes on issues that affect society. True Or False?
A charitable donation contributed by a corporation is an example of corporate philanthropy. True Or False?
Business issues such as minority hiring practices and pollution control fall under the umbrella of corporate responsibility. True Or False?
As a show of corporate responsibility to your customers, your firm may elect to provide more information regarding your product than the law demands. True Or False?
"Corporate philanthropy" refers to the position a firm takes on social and political issues. True Or False?
When stating a firm position on various social and political issues, "corporate policies" often commit company profits to back these positions. True Or False?
Recent surveys indicate that students are willing to agree to lower salaries if they know their employer is participating in socially responsible activities True Or False?
In the discussion of corporate social responsibility, stakeholders and stockholders refer to the same group. True Or False?
One responsibility of business is to satisfy customers by offering them goods and services with real value. True Or False?
Studies show that consumers are not concerned about the socially conscious behavior of the firms with which they do business. True Or False?
Obeying the law is __ ethical behavior:
A.essentially the same as
B. the first step towards
C. the opposite of
D. unlikely to lead to
__ Refers to standards of moral behavior:
A recent study revealed that most Americans have:
A. a strong moral value
B. a strong desire to do what is right
C. a few moral absolutes
D. a great desire to help their community
Which of the following statements describes ethical behavior in the US?
A. due to the diverse cultures that makeup the US it is difficult to identify common standards of ethical behavior.
B. the only common standards of ethical behavior in the US are reflected in religious teachings
C. we can find common moral values that many Americans uphold, including respect for human life, self control, honesty, integrity, and courage
D. Americans will generally describe the golden rule as the only statement of value they uphold.
The danger in writing new laws to correct behavior is that:
A. people may begin to think that any behavior that is legal is acceptable.
B. people will see the difference between ethics and legality
C. legal behavior will reflect the totality of peoples relations with one another
D. there will not be enough jails to house those who break the law
Given the ethical lapses that are prevalent today in our businesses, which of the following can be done to restore trust in the free market system and leaders in general?
A. business leaders that have broken the law should be given a second chance
B. new laws making accounting records transparent may help restore trust
C. making the government accountable for business leader behavior will restore trust
D. its up to the government to pass laws requiring ethical behavior of all leaders, business, etc.
Laws represent the standards of__ behavior
D. socially acceptable
Ethical behavior covers a__ range of conduct than legal behavior
B. more limited
D. less demanding
Many individuals today believe that ethical behavior is determined by what is best for them at the time. This is an example of:
A. situational ethics
B. moral absolutes
C. the golden rule
D. new age realism
Considering the potential impact on other prior to making a decision is consistent with ___behavior.
D. self motivated
Many Americans define ethical behavior according to the situation in which they find themselves. This suggests that there may be situations where___ to cheat, lie, steal.
A. it is absolutely wrong
B. it might be OK
C. business people are expected
D. capitalism forces people
The legal briefcase box, paying the price, describes situations where:
A. company executives got in trouble and landed in jail b/c their ethical behavior, rather than their legal behavior was in question.
B. a number of top executives of well known corporations committed a range of crimes including stealing, security fraud, and making false regulatory filings.
C. clearly executives were following the letter of the law, but their ethical behavior brought down the firms
D. large companies are forced to pay for their executives incarceration in federal prison
With respect to Arthur Anderson, a large and well-known public accounting and consulting firm, "Paying the price", explains:
A. how Arthur's connection with the Enron scandal was not enough to bring it down.
B. how as soon as Arthur cleared itself by paying fines to the fed. gov., it went back to "business as usual."
C. that Arthur's prior conviction was overturned, but it never recovered.
D. that Arthur's consulting arm always behaved ethically, so it was saved.
Upon reading "paying the price" you should conclude that:
A. top executives of Enron, Arthur Anderson, Tyco, Adelphia, and Worldcom didn't define the ethical behavior of the firms.
B. top executives are figureheads that don't necessarily know the technical aspects of the business, so the courts will not hold them accountable.
C. the securities and exchange commission cant control the private purchase or sale of company stock by top executives
D. top executives are closely intertwined with all aspects of their companies
purposefully understating your firm's income to avoid paying higher taxes is an example of:
A. an accepted business practice
B. tax accountants doing their job
C. illegal behavior
D. a firm's responsibility to its owners
When Worldcom used intentional accounting irregularities to make the company look more profitable than it actually was, it:
A. provided its stockholders profit through a tax-loophole
B. acted in an acceptable business manner
C. engaged in illegal behavior
D. executed its responsibility to its owners
Cigarette producers refused to voluntarily place health warnings on their packages. In response, the fed. gov. passed laws requiring health warnings on all cigarette packages. With respect to ethical behavior, this sequence of events is:
A. the intended approach
B. the desired approach
C. not the desired approach
D. not really a concern
Though it has received alot of attention, the development of the Internet has had less of an impact on the way businesses operate than many other technological changes. True Or False?
An increase in productivity indicates that more can be produced in a given time with the same amount of resources. True Or False?
Technology can help businesses become more efficient and productive. True Or False?
Productivity is the amount of output you generate given the amount of input such as hours worked. True Or False?
Effectiveness means producing goods and services using the least amount of resources. True Or False?
Effectiveness means producing the desired result. True Or False?
Technology affects people in most, but not all industries. True Or False?
Technology refers to everything that makes business operations more effective, efficient, and productive. True Or False?
E-Commerce is the buying and selling of goods over the Internet. True Or False?
The B2B Internet market consists of selling goods and services to consumers. True Or False?
On its website, Papa Johns Pizza compares itself to the competition with the following message: "better ingredients, better pizza". The company wants to achieve:
A. product differentiation
B. an equilibrium price
C. a monopoly
D. a perfectly competitive market
Which of the following statements most accurately identifies a limitation of the free-market economic system:
A. free-market economies offer little opportunity for the poor to work their way out of poverty.
B. free-market economies have been unable to create wealth as rapidly as other types of economic systems.
C. free market economies are generally plagued by shortages of needed consumer goods.
D. free-market economies tend to result in unequal distribution of wealth
Farmers and the auto industry are participating in the going green revolution. By promoting the fact that they sell green products or that they utilize green techniques to produce the products and services that they sell, firms who fall under a ___ type market may have opportunity to differentiate themselves from the competition.
A. purely competitive
D. monopolistic competition
A major benefit of socialism is the:
A. ability to stimulate rapid economic growth
B. ability to keep taxes low
C. emphasis on social equality
D. emphasis on private enterprises instead of public ownership
Under the__ system there is very little incentive to work hard or to produce quality goods or services.
D. mixed economy
Under the___ system the number of choices in the market is directly related to government involvement in markets.
D. mixed economy
There are some restrictions on freedom of speech and assembly under a____system.
D. mixed economy
Brain drain has occurred in many socialist nations because:
A. socialism encourages an unequal distribution of income, leaving many without medical and social services.
B. the government does little to protect the natural environment
C. workers tend to have to work longer hours and receive fewer benefits under socialism
D. tax rates on well-respected professionals such as doctors tend to be very high
The economical and political system in which the government owns almost all factors of production is called:
The world market is approximately___
A. 7 billion potential customers
B. 300 million potential customers
C. 200 billion potential customers
D. 30 billion potential customers
Which of the following continents is home to the largest percentage of the worlds population?
C. north america
A nation has a ___ in the production of a good or service if it can produce that good or service more effectively or efficiently than it can produce other goods.
A. supreme advantage
B. primary efficiency
C. qualified advantage
D. comparative advantage
__ occurs when a country has a monopoly on producing a product or is able to produce it at a cost well below that of all other countries.
A. comparative advantage
B. absolute advantage
C. complete advantage
D. dumping advantage
The theory of comparative advantage exists because:
A. there are too many products and services to choose from today
B. customers are always comparing the quality of service from companies in the same industry
C. no nation can produce all the products its people want and need
D. free trade agreements became the trend during the past 15 years
One advantage of free trade is:
One advantage of free trade is:
A. jobs are shifted to low wage global markets
B. service jobs are moved overseas
C. advanced production operations are built in low wage countries
D. innovation for new products occurs which keeps firms competitively challenged.
The concept of free trade means:
A. buyers and sellers contract with eachother and offer some goods at no cost
B. good and services can be traded freely across borders without political or economic barriers
C. there is no exchange of currency for these products
D. there is no exchange of currency, but the trading partners determine the value of product and perform a bartering process to exchange goods.
Why does it make sense to trade with other nations?
A. after producing all the product and services its people want and need, a nation can sell the excess products to the world.
B.some nations have lots of natural resources and technological know how. they have an ethical obligation to offer the rest to other nations.
C. other nations need foreign currency.
D. a nation will produce what it can produce most efficiently and effectively and buy from other nations what they can produce most efficiently and effectively.
Which of the following statements best describes the theory of comparative advantage?
A. the best way for a nation to ensure full employment is to be totally self sufficient rather than relying on other nations to obtain goods and services.
B. each nation should produce those goods that it can produce more efficiently and effectively than other nations, and buy goods it cant produce effectively from other nations.
C. the nation that has the largest reserves of gold and other natural resources will enjoy a position of comparative advantage
D. a nation should produce those goods for which domestic demand is comparatively strong, and should import those goods for which domestic demand is comparatively weak.
The theory of___ states that a nation should produce and sell goods to other countries that it produces most efficiently and buy goods from other nations that they produce more efficiently.
A. comparative advantage
B. absolute advantage
D. bilateral advantage
Free trade between nations generally results in:
A. industrialized nations gaining at the expense of developing countries
B. an increase of jobs in developed nations
C. mutually beneficial exchange relationships
D. higher prices for imported goods
The US currently enjoys a comparative advantage in__
B. sheep production
D. software services
A free trade agreement is likely to result in:
A. an increase in imported goods and services
B. an absolute advantage
C. less competitive
D. productivity increases in all product categories for all participating nations
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