Chapter 6

Question 1

Characteristics such as current demand and supply and type of competition help determine the ________ in which a business operates.

Answer 1

economic environment

Question 2

The _______ environment is the relevant conditions that exist in the economic system in which a company operates.

Answer 2

Economic

Question 3

What is outsourcing?

Answer 3

A senior assisted-living facility has started sending its linens out to a commercial laundry firm because the laundry firm can clean them more cheaply.

Question 4

Making shoelaces is a specific process that Nike needs as part of its shoes, but it can be done cheaper in Bangladesh where the cost of labour is significantly less than Canada. The action of moving shoelace production is known as ________.

Answer 4

outsourcing

Question 5

To determine the ________ for a given country for a given year, you need to know the total value of all goods and services a national economy produces during that year using its domestic factors of production, and its population.

Answer 5

GDP per capita

Question 6

What is a joint venture?

Answer 6

A strategic alliance in which the collaboration involves shared ownership of the new venture

Question 7

What is the socio-cultural environment?

Answer 7

The customs, mores, values, and demographic characteristics of the society in which an organization functions

Question 8

What is a strategic alliance in which the collaboration involves shared ownership of the new venture?

Answer 8

Joint venture

Question 9

If the economy shrinks for two consecutive sessions, the economy is experiencing a __________ .

Answer 9

recession

Question 10

A __________ occurs when the trough of the business cycle extends two or more years.

Answer 10

depression

Question 11

What is the total amount of money a country owes its creditors?

Answer 11

National debt

Question 12

Explain cyclical unemployment

Answer 12

People are out of work because of a downturn in the business cycle.

Question 13

What is basic (or pure) R&D?

Answer 13

Improving knowledge in an area without a primary focus on whether any discoveries that might occur are immediately marketable

Question 14

What would you need to determine the GDP per capita for a given country for a given year?

Answer 14

The total value of all goods and services a national economy produces during that year using its domestic factors of production, and its population

Question 15

Explain acquisition

Answer 15

An acquisition is the purchase of one company by another.

Question 16

What is the union of two corporations to form a new corporation.

Answer 16

merger

Question 17

What is strategic alliance?

Answer 17

A strategic alliance is a strategy in which two or more organizations collaborate on a project for mutual gain.

Question 18

What is a strategy whereby a firm sells one or more of its business units?

Answer 18

diverstiture

Question 19

A period where the Canadian economy experiences generally falling prices is described by the term ___________.

Answer 19

deflation

Question 20

What is economic environment?

Answer 20

The relevant conditions that exist in the economic system in which a company operates

Question 21

There are always a certain amount of people that are out of work temporarily while looking for a new job. This is known as ___________.

Answer 21

frictional unemployment

Question 22

What defines a company that is owned by another corporation?

Answer 22

Subsidiary

Question 23

The strategy of setting up one or more corporate units as new independent corporations is known as a __________.

Answer 23

spinoff

Question 24

The level of joblessness among people actively seeking work in an economic system is the definition of _________.

Answer 24

unemployment

Question 25

What is a company that is owned by another corporation?

Answer 25

Subsidiary

Question 26

In Canada, the federal government uses _______ to manage its revenues.

Answer 26

Fiscal policies

Question 27

What is a measure of the prices of typical products purchased by consumers living in urban areas?

Answer 27

Consumer price index

Question 28

The growth (and contraction) pattern of short-term ups and downs in an economy is called the __________.

Answer 28

business cycle

Question 29

What is the purchasing power parity?

Answer 29

Exchange rates that are set so the prices of similar products in different countries are about the same

Question 30

If executives at Holt Renfrew are conducting an industry analysis using Porter's five forces model, which of the following elements are they considering when examining the possibility for American companies to cross the border and open up stores in Canada?

Answer 30

Threat of potential entrants

Question 31

When the money supply of a country expands but production does not, what is the likely result?

Answer 31

Inflation

Question 32

The total of a country’s exports (sales to other countries) minus its imports (purchases from other countries) is known as the __________.

Answer 32

balance of trade

Question 33

``` The​ ______ is everything outside an​ organization's boundaries that might affect it. A. external environment B. multiple organizational environments C. internal environment D. organizational exterior E. organizational environment ```

Answer 33

external environment

Question 34

``` When the economy experiences two or more consecutive quarters of decline in GDP we call this​ a(n) _______________. A. business cycle B. depression C. economic cycle D. collapse E. recession ```

Answer 34

recession

Question 35

``` The​ ______ is the total of a​ country's exports minus its imports. A. budget surplus or deficit B. nominal GDP C. balance of trade D. balance of payment E. aggregate output ```

Answer 35

balance of trade

Question 36

``` Inflation in canada is measured by the​ _______________. A. standard of living B. producer price index C. national debt D. consumer price index E. internal debt ```

Answer 36

consumer price index

Question 37

``` Although many people associate technology with​ ______. it is also a significant factor in the​ ______ sector. A. arts and​ entertainment; design and development B. ​service; manufacturing C. ​manufacturing; service D. ​automotive; parts E. ​agricultural; manufacturing ```

Answer 37

​manufacturing; service

Question 38

``` When​ McDonald's responds to concerns about nutrition and health by adding salads to its​ menu, they are pursuing opportunities in the​ ____________ environment. A. technological B. sociocultural C. competitive D. economic E. Political-legal ```

Answer 38

sociocultural

Question 39

``` When someone purchases a train ticket instead of an airplane ticket to take a trip between two​ cities, this reflects​ ______ according to​ Porter's five forces model. A. the rivalry among existing competitors B. the bargaining power of buyers C. the threat of substitute products D. the threat of potential entrants E. the bargaining power of suppliers ```

Answer 39

the threat of substitute products

Question 40

``` _________ is the strategy of paying suppliers and distributors to perform certain business processes or to provide needed materials or services. A. Virtual management B. Offshoring C. Viral marketing D. Core competency E. Outsourcing ```

Answer 40

Outsourcing

Question 41

``` The​ _____ environment includes the​ customs, mores,​ values, and demographic characteristics of the society in which an organization functions. Question content area bottom Part 1 A. global B. domestic C. sociocultural D. economic E. ​political-legal ```

Answer 41

sociocultural

Question 42

``` Competition from companies such as​ BMW, Hyundai, and Honda is a part of Ford Motor​ Company's _____ business environment. Question content area bottom Part 1 A. sociocultural B. economic C. ​political-legal D. domestic E. global ```

Answer 42

domestic