Flashcards in Mid-Term Exam Deck (80):
A local retailer called its customers when it receives merchandise that they may be interested in, provides individual service to each customer, provides forms and phone numbers for complaints and comments, and has a 100% satisfaction guarantee. Which objective is this business working hard to accomplish?
Satisfying the needs of its customers.
Shawn Diaz decides to start his own business. How likely is Shawn to still be operating a successful business in seven years?
It is unlikely because over half of all new small businesses fail.
What is not a feature of laissez-faire capitalism?
The monetary contributions that the owners of IBM pay for shares of the company’s stock are ____ resources for IBM.
Capital or capital goods as recognized by economists would include all of the following except:
2. Crude Oil
What is uncharacteristic of a socialist economy?
All capital and capital goods are privately owned.
Productivity is best described as...
The average level of output per worker per hour.
In the mid-1970’s , American auto manufacturers produced big gas-guzzling cars and tried to sell them to consumers who needed fuel-efficient transportation. This happened because manufacturers...
Lost sight of consumers’ needs.
What is not a characterization of a depression?
Two or more consecutive three-month periods of GDP decline.
What is an example that would not be included in the Gross Domestic Product of the United States?
Value of McDonald’s sales for their Tokyo locations.
What are three activities must a business perform in order to be successful?
1. Be Organized
2. Satisfy Needs
3. Earn a Profit
What is Profit?
The remaining balance after all expenses have been deducted from the sales revenue.
The application of moral standards to business situations.
Consumer’s expect firm’s products to...
Be safe, reliable, and reasonably priced.
Rose Martinez walked into her office and found a large extravagant bouquet on her desk. Before she had time to read the card, her secretary said it was from Mr. Tanner at Zero Corporation. The secretary knew Mr. Tanner was trying to negotiate a sales deal with the company. Thus, she remarked that the beautiful flowers should help Ms. Martinez make her decision. Although Ms. Martinez did not know how to respond to Mr. Tanner’s gift, she thought an answer might be in her company’s...
Code of Ethics
What is probably the most effective way for a company to encourage ethical behavior?
Develop and enforce a written code of ethics for the organization.
One reason American business must be concerned about product safety is that...
Consumers demand safe products.
Product labels on detergent that indicate ingredients and laundering methods are examples of which provision of Kennedy’s Consumer Bill of Rights?
The right to be informed.
What does the government encourage in order to protect the consumer’s right to choose?
What have the courts ruled about quotas as part of affirmative action programs?
Courts have ruled quotas unconstitutional but commended their purpose.
Over the past several decades, concern for the environment has...
Increased significantly because pollution became a threat to life and health.
What led most directly to increased government involvement with regulating business and its dealings with society?
The Great Depression
International business includes all business activities that involve exchanges across state boundaries. True or False?
The United States has enjoyed a trade surplus during the last two decades. True or False?
Although it lacks sources of timber and oil, California has a plentiful supply of grapes for its many wineries. What advantage does California have with what resource?
It has a comparative advantage in wine production.
If Japan were regarded as the best electronic manufacturer in the world, what advantage would they have with what product?
Japan would have an absolute advantage in electronics production.
Purchasing products or materials in other nations and bringing them into one’s own country is...
By definition, every country has a(n) _____ advantage in some product.
A small country is just beginning its international trade activities. In so doing, it wants a favorable balance of trade.
Provide markets for its products
When a country exports more than it imports, it has a(n)...
Favorable balance of trade.
Another name for an import duty is a...
Japanese tourists come to experience the magic of Disney World and other attractions around Orlando, Florida. These tourists are...
Helping the United States’ balance of payments.
Absolute advantage is...
The ability to produce a specific product more efficiently than another nation.
Comparative advantage is...
The ability to produce a specific product more efficiently than any other product.
Every country has a comparative advantage in some product. True or False?
Every country has an absolute advantage in some product. True or False?
What is a tariff? What does it do?
Known as an import duty, on a particular foreign product entering a country. They are imposed to raise revenue or protect domestic industries.
How would you go about incorporating a business?
A lawyer is recommended for this.
You first choose which state you would like to be incorporated in. Submit articles of incorporation to the Secretary of State. Decide stock holder rights. Adopt corporate by-laws and elect a board of directors.
Stephen decides his business will begin staying open until 7 p.m. instead of 6 p.m. The next day, the shop stays open until 7 p.m. This environment of flexibility to quickly change is characteristic of what form of business organization?
What is an advantage of a sole proprietorship?
Profits are taxed as individual income.
Unlimited liability means...
The owner is responsible for all business debts.
When the owner of a sole proprietorship dies, what becomes of the business?
It ceases to exist unless the heirs take it over or sell it.
When compared to a larger business, the lure of employee benefits is one reason why people go work for small businesses. True or False?
Walmart is incorporated in Arkansas, the state of its origins and headquarters. Within Arkansas, Walmart is classified as a(n) ______ corporation.
When starting a corporation, people submit articles of incorporation to...
Secretary of State
Common stock carries all rights except the right to...
Receive part of the profit before other classes of stock.
What is an example of a vertical merger?
The purchase of Kentucky Fried Chicken by PepsiCo
Profits of a large corporation are taxed twice, once as a corporate income and again as personal income of stockholders. True or False?
Why do certain industries tend to be more attractive than others for start-ups?
Certain industries require a low initial investment and a special skill or knowledge. While others are an expensive expertise.
What is a business plan? Why is it important?
A carefully constructed guide for someone starting a business. It is a management tool that can the the owner or manager keep track and evaluate progress. Can also be used as a guide for the owner to plan phases of the business.
An investor who is considering investing in Diane’s Burger Bar would not likely want to see her business plan. True or False?
Service industries make up about 48 percent of all small business. True or False?
A business has sever al customers but is not dominant in its field. This is an example of a(n) _______ business.
A company generally needs more than _______ employees in order to be considered large.
What is the primary reason that so many new businesses fail?
Mismanagement resulting from lack of business know-how.
This reason is NOT why people go into business...
Guaranteed return on investment.
Most Small Business Administration loads are actually made by...
A franchisor doesn’t supply _____ for the franchisee.
Land to place the business on.
The business (McDonalds) is the ________ and you are the ______.
You stop at SUBWAY to get a sandwich for lunch and you notice that they now have TCBY yogurt. This is an example of...
Goals are set only for top-level management. True or False?
As a manager carries out his or her functions, the first step is control, the second is to organize, the third is to plan. True or False?
McDonalds prides itself on it’s efficiency and value in delivering a product in a very short time. These characteristics can be best defined as McDonalds...
If on January 1, 201 Microsoft stated that by 2020 it wants to have a 85% share of U.S. software market, it is stating a(n)...
What is NOT considered a communication skill that may be essential in management success?
Displaying genuine compassion
Fernando Garcia is responsible for two departments that continually set conflicting goals. Fernando must get involved in ________ to achieve some sort of balance between those goals.
The CEO’s role at General Electric requires him to spend a great deal of time on planning. This indicates that he is a(n) ____________ manager.
What is a disadvantage associated with the participative style of leadership?
The decision making process is time-consuming.
When all employees are exceedingly clear about what is expected from them, guidelines for task completion are clear and understood, and rules and regulations in fulfilling their duties are clearly defined, it is likely this leadership style is in place.
A positive problem may be viewed as a(n)....
Distinguishing between positions with direct authority and those that are support positions establishes an organization’s...
Chain of command
Ann delegated work to an employee who mismanaged public funds. Ann, rather than the employee, was reprimanded for this mismanagement. Ann is now reluctant to delegate because she...
Knows the person who delegates remains accountable for the work.
When a worker has to learn only a specific, highly specialized task, that individual should be able to learn to do it very efficiently. However, this efficiency could eventually become inhibited by job monotony and boredom. This situation could be alleviated through...
Grouping jobs into manageable units according to some reasonable scheme is known as...
What is not a true statement about accountability?
Managers delegate accountability
As a new manager for Microsoft, Pedro is unwilling to delegate work. He realizes that, although he can delegate assignments to others, he cannot delegate his...
Obligation to see that tasks are completed
Mr. Jones will manage employees throughout the northwestern region of the United States. His employees will consist of most major nationalities and both males and females. In determining his span of control, you should consider which of the following span factors?
Whether the subordinates are physically located far from one another.
Which of the following is most characteristic of a line structure in an organization?
Quick decision-making and direct accountability.
Since Sears operates in a complex and dynamic environment, it’s store managers are given significant freedom to run their stores. This indicates that top leaders at Sears...