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Name: _______________________________________ Date: _______________________Exam 1: Chapters 1 - 51. Cultural diversity representsa. a business theory that is no longer valid.b. the differences among people in a workforce. c. a technical skill.d. a statistical method used to project sales revenues and profits for global companies. e. a religious issue that doesn't affect business organizations.2. Raw materials, buildings, and machinery are resources. a. humanb. financialc. informational d. labore. material3. Libby works for IBM. She handles the company’s payroll, employee concerns, and all promotions and raises. Libby is primarily concerned with the company’s ____________ resources.a. humanb. financialc. informational d. labore. material4. A business’ efforts to sustain the planet and their participation in ecological movements are part of a firm’sa. free enterprise system.b. stakeholder responsibilities. c. factors of production.d. social responsibility. e. business cycle.5. When a firm's sales revenues are greater than its expenses, the firm has a. profit.b. loss.c. positive cash flow. d. financial resource.e. factor of production.6. For a business, stakeholders represent a. investors in the business.b. lenders that have provided loans.c. suppliers that have extended credit to the firm in search of profit for the firmd. employees who work for the firm.e. all of the different people or groups who are affected by the business.7. According to economists, natural resources, labor, capital, and entrepreneurship are called a. free resources.b. competitive resources. c. factory resources.d. factors of manufacturing. e. factors of production.8. Diane is passionate about soccer and decides to open her own soccer sporting goods store. She invests her money, time, and effort into making the store a success. Diane can be best described as a(n)a. Capitalistb. Laborerc. Corporate ownerd. Entrepreneure. Competitor9. The United States, whose economy exhibits elements of both capitalism and socialism, has what is known as a(n) economy. a. plannedb. utilitarianc. nationalized d. mixede. centralized10. Business ethicsa. is laws and regulations that govern business.b. is the application of moral standards to business situations. c. do not vary from one person to another.d. is most important for advertising agencies.e. is well-defined rules for appropriate business behavior.11. Investors expect management to do all of the following excepta. consult them on ethical decisions.b. increase sales.c. boost the company's profit.d. increase the return to the investor. e. make sensible financial decisions.12. You are the decision maker for purchasing office equipment in your organization. One sales representative privately offers you season tickets to the Chicago Bears if you help him out. This tactic isa. a corporate discount.b. a common business practice. c. a bribe.d. personal selling. e. ethical.13. A large computer manufacturer forbids its executives and managers from serving as directors or officers for Intel Corporation or any other corporations from which it might purchase component parts. The company is trying to preventa. their employees from having other jobs. b. a conflict of interest.c. trade secrets from being revealed.d. losing its executives to other organizations. e. fairness and honesty.14. What are the three sets of factors that influence the standards of behavior in an organization?a. Organizational norms, circumstances, morals b. Peer pressure, attitudes, social factorsc. Historical factors, management attitudes, opportunity d. Opportunity, individual factors, social factorse. Financial factors, opportunity, morals15. If a company deals with violations of its ethical codes , the opportunity to be unethical will be reduced. a. leisurely and lightlyb. firmly and consistentlyc. on a case-by-case basis d. quietly and erraticallye. frequently and severely16. Which of the following scenarios provides the best example of whistle-blowing?a. Jonathon fails to meet his sales quota for the month and is reported to the regional manager for special review.b. Christine tells her husband about illegal environmental dumping she suspects her company is doing.c. William gives an interview on NBC's Dateline about the opportunities available at his company.d. Geena speaks to her boss about how uncomfortable she is with the sexual jokes one of her coworkers frequently tells at the office.e. Marie has grown tired of her company's unsafe practices and reports them to OSHA, a governmental agency that regulates safety.17. Dell’s global outreach programs that help bring technology to underserved communities in various parts of the world is an example ofa. social responsibility. b. business ethics.c. code of ethics. d. consumerism.e. affirmative action programs.18. The socioeconomic model of social responsibility places primary emphasis on a. quality of life.b. production.c. economic return.d. exploitation of natural resources. e. profit.19. The motion picture industry uses a rating system to describe the content of its movies. Movies are accompanied by ratings such as PG (parental guidance suggested) or R (not suitable for those under 17). This rating system satisfies consumers' right toa. be heard. b. safety.c. be informed. d. censorship.e. watch what they want to watch.20. Which of the following scenarios would not be considered international business?a. A Chinese manufacturer sells toys to a large toy retailer in the United States. b. Intel sells its processors to a computer manufacturer in Korea.c. A large jewelry store in England purchases its diamonds from DeBeers in South Africa. d. A bearing manufacturer in South Carolina sells its parts to a Toyota plant in Kentucky. e. French companies purchase crude oil from Saudi Arabia.21. The land of Narnia has very infertile soil but a large supply of oil. What action should Narnia take? Narnia shoulda. specialize in the production of crude oil and trade this for grain and other food products. b. grow food anyway because its people will need it for survival.c. focus on attracting tourists to its country and thus purchase the needed supplies of food. d. specialize in the production of food products such as cereals and bread.e. import oil to satisfy the country's need for gasoline.22. If Japan were regarded as the best electronics manufacturer in the world, what would be true?a. Japan would have a comparative advantage in electronics manufacturing. b. Japan would have a positive balance of trade.c. The United States would have a comparative advantage in electronics. d. Japan would have an absolute advantage in electronics production.e. Japan would have a trade deficit with the United States.23. If Germany exports $100,000 of sauerkraut to Jamaica and purchases $100,000 of Blue Mountain coffee beans from Jamaica, Germany hasa. an overall favorable balance of trade.b. an overall unfavorable balance of trade.c. a favorable balance of trade with Jamaica.d. neither a favorable nor an unfavorable balance of trade with Jamaica.e. an unfavorable balance of trade with Jamaica.24. Coffee Co. ____________ coffee beans from Colombia, then processes and packages the finished product. The company sells its coffee in the US and also ___________ it to Canada.a. imports; tradesb. exports; importsc. imports; exportsd. trades; importse. barters; exports25. When the United States levies a tax on textiles from India, this tax is a type of a. export duty.b. barter. c. import. d. tariff.e. responsibility.26. The United States wishes to import no more than 100 million tons of sugar from India in any given year. The type of import restriction it should impose is a(n)a. import duty.b. foreign exchange control. c. import quota.d. embargo.e. export duty.27. Any measure imposed by a government to favor domestic products over foreign products not involving taxes is a(n)a. import duty.b. nonmonetary restriction. c. embargo.d. restriction of trade. e. nontariff barrier.28. The United States bans Cuban cigars and other Cuban products from entering the United States due to political difficulties. This action is called a(n)a. embargo.b. import quota. c. trade ban.d. foreign-exchange control. e. import duty.29. Suppose the country of Gaditia wanted to join GATT and thus be treated the same as other GATT members. What GATT principle is Gaditia interested in receiving?a. Free tradeb. Importation/exportation c. The Tokyo Roundd. Foreign-exchange controle. Most-favored-nation status30. The primary objective of the World Trade Organization is toa. help underdeveloped nations increase their standard of living. b. achieve world peace.c. remove barriers to trade worldwide.d. enforce worldwide political and trade regulations. e. promote the invention of new technologies.31. Who are the members of NAFTA?a. The United States, Canada, and Mexico b. Greenland, Iceland, and Canadac. Guatemala, Honduras, and Mexicod. The United States, Mexico, and Japane. The United States, Canada, and the United Kingdom32. _________is a contractual agreement where one firm gives another permission to produce and market its product and brand name in exchange for a fee.a. Licensing b. Exportingc. Joint venture d. Countertradee. Strategic alliance33. Angela is tired of her boss as well as corporate America in general. She decides she would like to start a business where no one tells her what to do, and she can always make the decisions. The best form of business for Angela is a(n)a. partnership.b. limited partnership. c. singleship.d. sole proprietorship. e. S-corporation.34. Unlimited liability meansa. there is no limit on the amount an owner can borrow.b. creditors will absorb any loss from nonpayment of debt.c. the business can borrow money for any type of purchase. d. the owner is personally responsible for all business debts.e. stockholders can borrow money from the business.35. A invests money in the business but has no management responsibility. a. general partnerb. limited partner c. sole proprietor d. nominal partner e. stockbroker36. In the state in which it is incorporated, a business is known as a(n)a. S-corporation.b. resident corporation. c. public corporation.d. foreign corporation.e. domestic corporation.37. Sears Holding Corporation is incorporated in Delaware, but when it operates in Illinois and Texas, it is considered a(n) corporation in those states.a. domestic b. foreignc. alien d. smalle. mid-sized38. Mark owns stock in Walgreens. He has the right to vote on company issues and examine corporate records, and he receives dividends from Walgreens' profits. What type of stock does Mark own?a. Common b. "A" class c. Proxyd. Dividend e. Preferred39. The order of difficulty and expense, from most to least, when forming a business organization is as follows:a. corporation, sole proprietorship, partnership. b. corporation, partnership, sole proprietorship. c. partnership, corporation, sole proprietorship. d. partnership, sole proprietorship, partnership. e. sole proprietorship, partnership, corporation.40. Which of the following organizations would be considered a small business?a. Producer of semiconductors with 2,000 employees b. Wholesaler with 50 employeesc. Retail clothing store chain with annual sales of $26 milliond. Construction company with average annual receipts of $32 million e. Farmer with annual receipts of $10 million41. What is the primary reason that so many new businesses fail?a. Owner does not work hard enoughb. Mismanagement resulting from lack of business know-how c. Low employee quality for new businessesd. Lack of brand-name recognitione. Inability to compete with well-established brand names42. An individual's desire to create a new business is referred to asa. the entrepreneurial spirit.b. the desire for ownership. c. self-determination.d. self-evaluation.e. the laissez-faire spirit.43. Cindy compiles a business plan for a business she hopes to start. This plan should answer all of the following questions excepta. How much will the new business cost?b. Why is this new business a good idea?c. What are Cindy's goals for the business?d. What is the nature and mission of the business?e. How often will the business have a sale?44. You have been running a successful art and framing shop for three years. You have decided to allow others to use your business name, materials, and methods in operating their own business for a fee. You are going to enter aa. joint venture.b. small-business development center. c. franchise agreement.d. venture capitalist agreement. e. business contraction.Bonus Question: In class, we watched a video on Sara Blakely, a successful entrepreneur who started a now multi-billion dollar business called _______________________________________. (2 points) ................
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