EXAM III

Question 1

What is the main purpose of finance in business?

Answer 1

To raise capital, invest in projects, and manage financial risk.

Question 2

What is the time value of money?

Answer 2

The idea that $1 today is worth more than $1 in the future due to inflation and earning potential.

Question 3

What is the Rule of 72?

Answer 3

72 divided by the interest rate equals the number of years to double an investment.

Question 4

What is the difference between simple and compound interest?

Answer 4

Simple interest is only on principal; compound interest includes accumulated interest.

Question 5

What is the formula for Present Value (PV)?

Answer 5

PV = FV / (1 + r)^n

Question 6

What is the formula for Future Value (FV)?

Answer 6

FV = PV * (1 + r)^n

Question 7

What affects a company’s capital structure?

Answer 7

Industry type, company stage, interest rates, and risk tolerance.

Question 8

What are the two main ways businesses raise funds?

Answer 8

By selling equity (stock) or issuing debt (bonds).

Question 9

What does operations management focus on?

Answer 9

Designing and improving processes to efficiently convert inputs into outputs.

Question 10

What is productivity?

Answer 10

The ratio of outputs to inputs.

Question 11

What is efficiency in operations?

Answer 11

Actual output divided by standard output.

Question 12

What is Just-in-Time inventory?

Answer 12

A system where materials arrive only when needed, minimizing storage costs.

Question 13

What is Just-in-Case inventory?

Answer 13

A system where materials are stockpiled to ensure readiness.

Question 14

What does IT support in business?

Answer 14

Decision-making, communication, and business operations.

Question 15

What are common IT risks?

Answer 15

Hacking, malware, and data breaches.

Question 16

What is power in an organizational context?

Answer 16

The ability to influence others’ actions.

Question 17

What are French and Raven’s types of power?

Answer 17

Reward, Coercive, Legitimate, Expert, Referent.

Question 18

What is control in organizations?

Answer 18

Aligning individual goals with organizational goals.

Question 19

What are the four control mechanisms?

Answer 19

Market, Agency, Bureaucratic, Clan.

Question 20

What are the four leadership approaches?

Answer 20

Traits, Behaviors, Problem-Solving, Influence.

Question 21

When is moderate conflict beneficial?

Answer 21

When it increases productivity and effectiveness.

Question 22

What are five conflict management styles?

Answer 22

Competing, Avoiding, Accommodating, Compromising, Collaborating.

Question 23

What are programmed decisions?

Answer 23

Routine, repetitive decisions.

Question 24

What are non-programmed decisions?

Answer 24

Novel, unstructured decisions.

Question 25

What is the Carnegie model of decision-making?

Answer 25

Making the best possible choice with limited time and information.

Question 26

What is motivation in a business context?

Answer 26

A psychological force driving goal-directed behavior.

Question 27

What are SMART goals?

Answer 27

Specific, Measurable, Achievable, Relevant, Time-bound.

Question 28

What are intrinsic and extrinsic motivation?

Answer 28

Intrinsic = internal satisfaction; Extrinsic = external rewards.

Question 29

What are HR's main functions?

Answer 29

Recruiting, selecting, training, evaluating, compensating employees.

Question 30

What laws affect HR practices?

Answer 30

Civil Rights Act, ADA, Age Discrimination laws, Title VII and IX.

Question 31

What is job analysis?

Answer 31

A process to define job roles and responsibilities.

Question 32

What is DEI?

Answer 32

Diversity, Equity, and Inclusion in the workplace.

Question 33

What are the levels in Schein’s model of culture?

Answer 33

Artifacts, Espoused Values, Basic Assumptions.

Question 34

How do founders influence culture?

Answer 34

By establishing early rules, values, and practices.

Question 35

What is organizational culture?

Answer 35

Shared values and norms that guide behavior.

Question 36

What is strategy?

Answer 36

A plan to use core competencies for competitive advantage.

Question 37

What are three types of strategy?

Answer 37

Functional, Business, Corporate.

Question 38

What are three sources of competitive advantage?

Answer 38

Differentiation, Low Cost, Integrated.

Question 39

What is equifinality?

Answer 39

Multiple ways to achieve the same outcome.

Question 40

What future trends affect business?

Answer 40

AI, cybersecurity, climate change, workforce changes, global uncertainty.