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Question 1

four factors of production?

Answer 1

1. Natural resources: products in their natural state
2. Capital: technology, tools, information, and physical facilities
3. Human resources: workers for an organization. Contributions of physical labor and intellectual effort
4. Entrepreneurship: someone with the willingness to take risks to create and operate a business

Question 2

four types of competition in free markets?

Answer 2

1. Perfect competition: exists when there are many sellers in a market and no seller is large enough to dictate the price of a product with very low barriers to enter market.
2. Monopolistic competition: exists when a large number of sellers produce products that are very similar but are perceived by buyers as different.
   i. Coke vs Pepsi
3. Oligopoly: occurs when a few (3-5) sellers dominate a market, with high barriers to entry
   i. Phone plans (roger, TELUS, ….)
4. Monopoly: occurs when there is only one seller for a good or service, and that one seller controls the total supply. Often regulated by the government
   i. Icbc

Question 3

four types of unemployment

Answer 3

1. Frictional unemployment: occurs when workers are between jobs, have left for various reasons. There will always be some in the economy as people transition in and out of the workforce.
2. Seasonal unemployment: occurs when demand varies during the year, due to the nature of the industry. Unavoidable, bit in a strong economy seasonal workers may find alternate season employment.
3. Structural unemployment: refers to unemployment caused by the mismatch of skills and the jobs available. Workers must be retrained before they can return to work.
4. Cyclical unemployment: occurs because of a recession or a similar downturn in the business cycle. When business increases and recovers, these workers will return to work

Question 4

four types of trade restrictions (non-tariff)

Answer 4

1. Quotas: Limits the amounts of particular products that can be imported during specific time periods.
2. Dumping: Selling products in other countries at prices below production costs or below typical prices in the home market
3. Embargo: A total ban on importing a specified product or a total halt to trading with a particular country.
4. Exchange control: a restriction on important certain products or a restriction against certain companies to reduce trade and the spending of foreign currency.

Question 5

two major categories or types of ethical codes

Answer 5

1. Compliance-based: emphasizes preventing unlawful behavior by increasing control and by penalizing wrongdoers.
   i. Emphasis on not violating laws for a fear of legal prosecution.
2. Integrity-based: ethical standards that define the organization’s guiding values, create an environment that supports ethically sound behavior and shared accountability among employees.
   i. Core principles are put in place for employees to do what is right based on their own moral compass.

Question 6

three-point ethical checklist questions

Answer 6

1. Is it legal, and is it within my corporate rules of behavior?
2. Is it balanced, are all parties treated fairly?
3. How will it make me feel about myself, does it affect my conscience? Would I want others to know?

Question 7

four responsibilities to employees by employers

Answer 7

1. Workplace Safety. Managed mostly at the provincial level by organizations.
2. Ensuring Equal Opportunity on the Job. Providing equal opportunities to all employees without discrimination.
3. Sexual Harassment. Preventing unwelcome actions of a sexual nature, of any kind, from superiors or co-workers
4. Sexism - equal pay for work without regard to gender, equal pay for work of equal value; despite historic gender stereotypes of the work.

Question 8

advantages of franchising

Answer 8

1. Prior Performance Record, proven Business Model
2. Recognizable Company Name (Brand)
3. Tested Management Program, training
4. Savings through Volume Purchases

Question 9

disadvantages of franchising

Answer 9

1. Franchise Fees and upfront set-up costs are higher.
2. Ongoing payments (Royalties)
3. Linked to Reputation and Management of all other franchisees.
4. Franchise territory Agreement Restrictions (no growth outside area)
5. Tight Control (little creativity permitted)

Question 10

advantages of sole proprietorship

Answer 10

1. Simple to start, less complex to end.
2. Taxation is at the personal level, not the business.
3. Own business, self-direction, no partners, or boss

Question 11

disadvantages of sole proprietorship

Answer 11

1. Unlimited liability for all debts of business, personally
2. Limited in growth, size, sources of funds
3. Management can be all consuming.

Question 12

advantages of partnerships

Answer 12

1. More funds and sources of financing
2. Taxation is at the personal level, not the business.
3. Mutual agency can multiply efforts.

Question 13

disadvantages of partnerships

Answer 13

1. Unlimited liability for all debts of business, personally by all partners
2. Profits and losses are shared.
3. Conflict with partners can destroy business value.

Question 14

disadvantages of corporations

Answer 14

1. Complex and Costly to set up and maintain.
2. Two levels of taxation to manage.
3. Conflict is possible, more difficult, and costly to resolve.

Question 15

advantages of corporations

Answer 15

1. More options for investment by others
2. Liability is limited to invested amount, not personal funds.
3. Management and control can be separated

Question 16

five motivations for individual entrepreneurship

Answer 16

1. Being Your Own Boss: Self-management is the motivation that drives many entrepreneurs.
2. Financial Success: Entrepreneurs are wealth creators and idea generators.
3. Job Security: Large companies downsize, people take control of their own future.
4. Quality of Life: Starting a business gives the founder some choice over when, where, and how to work.
5. Innovative ideas: Believe that their ideas will fulfill customer needs in a better way.

Question 17

eight characteristics of entrepreneurs

Answer 17

1. **Vision*: an overall idea for how to make business ideas successful
2. High energy level: a willingness to work hard.
**3. Need to achieve: want to excel and achieve difficult goals.
4. Self-confidence: fearlessness in the face of difficult odds
5. Tolerance for failure: not easily discouraged.
6. Creativity: devise innovative ways to overcome difficult problems and situations; have new ideas for good and services
7. Tolerance for ambiguity: take business uncertainties in stride.
8. Internal locus of control: belief in control of own fate

Question 18

five categories of entrepreneurs

Answer 18

1. Classic entrepreneurs – pursues business opportunities and allocates resources to opportunities they find or create.
2. Serial entrepreneurs – starts one business, runs it, and then starts and runs additional businesses in succession.
3. Social entrepreneurs – focus on solving society’s challenges through their businesses.
4. Opportunity entrepreneurs – a once in a lifetime discovery leads them to create a company.
5. Necessity entrepreneurs – Lose your job, need to earn money in a different way.

Question 19

four ways to get started as a business owner

Answer 19

1. Start your own company – fresh idea, no history, very entrepreneurial, allows for sweat equity.
2. Buy an existing business – purchase a going concern, higher cost, but less risk, seller financing.
3. Buy a franchise unit – least risky, but highest cost of entry, less experience needed.
4. Inherit/take over a family business – much easier financially, but possible relational strain.

Question 20

nine sources of funds for a small business

Answer 20

1. Supplier credit: don’t have to pay your supplier right away, they are lending you the stock for a certain amount of time.
2. Personal savings: your money that you are willing to invest and risk.
3. Retained earnings: money that is earned from the business and is reinvested into the business.
4. Business credit cards
5. Personal loans, credit cards, lines of credit
6. Leasing Equipment and other assets
7. Loans from friends and relatives
8. Government lending agencies (BDC)
9. Angel Investors and Venture Capitalists

Question 21

three levels of management

Answer 21

1. Top Management
   i. Develop long-range plans for their organizations.
   ii. Inspire executives and employees to achieve their vision for the company’s future.
2. Middle Management
   i. Focus on specific operations, products, or customer groups within an organization.
   ii. Responsible for developing detailed plans and procedures to implement the firm’s strategic plans.
3. Supervisory Management
   i. Implement the plans developed by middle managers.
   ii. Responsible for non-manager employees.
   iii. Motivate workers to accomplish daily, weekly, and monthly goals.

Question 22

three skill types needed for managerial success

Answer 22

1. Technical Skills
   i. Ability to understand and use the techniques, knowledge, tools, and equipment of a specific department or area of study.
2. Human Skills
   i. Interpersonal skills to work effectively with people. Ability to communicate with, motivate, collaborate, and lead employees to complete their assigned activities.
3. Conceptual Skills
   i. Help a manager see the organization as a single unit and understand how each part of the overall organization interacts with other parts.
   ii. Allows a manager to see the big picture by acquiring, analyzing, and interpreting information and understanding how the contributions of each individual unit impacts the organization as a whole.

Question 23

four management functions

Answer 23

1. Planning
   i. Process of anticipating future events / conditions and deciding on courses of action for achieving company goals.
2. Organizing
   i. The process of blending human and material resources through a formal structure of tasks and authority.
3. Directing
   i. Guiding and motivating employees to accomplish organizational goals.
4. Controlling
   i. The function of assessing an organization’s performance against its goals

Question 24

four types of planning

Answer 24

1. Strategic
   i. Top management. Organizational objective, fundamental strategies, long-term plans
2. Tactical
   i. Middle management. Quarterly and semi-annual plans, departmental policies, and procedures
3. Operational
   i. Supervisory management. Daily and weekly plans, rules, and procedures for each department
4. Contingency
   i. Primarily top management, but all can contribute. Ongoing plans for actions and communications inn an emergency

Question 25

three leadership styles

Answer 25

1. Autocratic leadership: Centered on the boss; makes decisions on their own without consulting employees.
2. Democratic leadership: Includes subordinates in decisions and centers on employee contributions.
3. Free-rein leadership: Involves minimal supervision and allows employees to make most of their own decisions.

Question 26

five ways to departmentalize

Answer 26

1. Product departmentalization: Organizes work units based on the goods and services a company offers.
2. Geographical departmentalization: Organizes units by geographical regions within a country or, for a multinational firm, by region throughout the world.
3. Customer departmentalization: Might be used by a firm that offers a variety of goods and services for different types of customers.
4. Functional departmentalization: Organize work units according to business functions, such as finance, marketing, human resources, and production.
5. Process departmentalization: Organizes work units by work processes necessary to complete production of goods or services.

Question 27

five factors of compensation decisions

Answer 27

1. Competitive companies
2. Government minimums or regulations
3. Local cost of living
4. Company profits (or lack of)
5. Productivity of Employee

Question 28

five levels of Maslow’s hierarchy (needs)

Answer 28

1. Physiological needs-food shelter etc.
2. Safety needs–physical and economic protection
3. Social needs–belongingness, acceptance
4. Esteem needs–feeling valued and recognized.
5. Self-actualization needs–fulfillment of dreams, using all of your capabilities.

Question 29

herzberg’s two factors

Answer 29

1. Hygiene factors – result in satisfaction but do not motivate, can demotivate if reduced or changed.
   i. Salary, Job security, Working conditions.
   ii. Status, Interpersonal relations, supervision
   iii. Company policies
2. Motivator factors – can produce high levels of motivation if positive.
   i. Job responsibilities
   ii. Achievement
   iii. Recognition
   iv. Growth opportunities

Question 30

theory x

Answer 30

1. Theory X: assumes that employees dislike work and try to avoid it whenever possible, so management must coerce them to do their jobs, money, job security, and fear are motivators.

Question 31

theory y

Answer 31

2. Theory Y: assumes that the typical person likes work and will seek and accept greater responsibility, self-control, self- direction, and achievement are motivators.

Question 32

theory z

Answer 32

3. Theory Z: views worker involvement as the key to increased productivity for the company and improved quality of work life for employees

Question 33

four types of training

Answer 33

1. On-the-job training - prepares employees for job duties by having them perform tasks under the guidance of experienced employees.
2. Classroom and computer-based training - involves instruction such as lectures, conferences, workshops, or seminars, live or online.
3. Vestibule and Simulation training – work like conditions in a classroom or exact situations simulated.
4. Management development – on the job and classroom training designed to improve the skills and broaden the knowledge of managers.

Question 34

five types of flexible work

Answer 34

1. Flextime allows employees to set their own work hours within constraints specified by the firm.
2. Compressed work week allows employees to work the regular number of weekly hours in fewer than the typical five days.
3. Job sharing program allows two or more employees to divide the tasks, or days on duty of one job.
4. Remote work program allows employees to work at home instead of at the workplace.
5. Hybrid Positions combine work at home with regular day sin the office or workplace.

Question 35

five types of teams

Answer 35

1. Work teams: Relatively permanent groups of employees with complementary skills who perform the day-to-day work of organizations.
2. Problem-solving teams gather information to solve a specific problem.
3. Self-managed teams are work teams that have the authority to decide how their members complete their daily tasks.
4. Cross-functional teams have members from different functions, such as production, marketing, and finance.
5. Virtual teams are groups of dispersed co-workers who use a combination of telecom. and IT to accomplish an organizational task.

Question 36

five stages of team development

Answer 36

1. Forming is the orientation period.
2. Storming is when the personalities of the members come out as they clarify their roles and expectations.
3. Norming phase, members resolve differences and accept each other.
4. Performing phase, members focus on solving problems and accomplishing tasks.
5. Adjourning is when the team disbands after wrapping up and summarizing the team’s experiences and accomplishments.

Question 37

four types of listening

Answer 37

1. Cynical (defensive) listening: Receiver of a message feels that the sender is trying to gain some advantage from the communication.
2. Offensive listening: Receiver tries to catch the speaker in a mistake or contradiction.
3. Polite listening: Receiver listens mechanically to be polite rather than to communicate.
4. Active listening: Requires involvement with the information and empathy with the speaker’s situation.

Question 38

seven characteristics of open communication

Answer 38

1. Employees are valued.
2. High level of trust exists.
3. Conflict is invited and resolved positively.
4. Creative dissent is welcomed.
5. Employee input is solicited.
6. Employees are well-informed.
7. Feedback is ongoing.

Question 39

four production processes

Answer 39

1. Analytic production system:
   i. Reduces a raw material to its component or individual parts to extract one or more marketable products.
2. Synthetic production system:
   i. Combines two or more raw materials or parts, or transforms raw materials, to produce finished products.
3. Continuous production process:
   i. Creates the finished products on a repetitive production line, efficiency is gained over time.
4. Intermittent production process:
   i. Creates products in short production runs, shutting down or changing machines frequently to produce different products. Value is created by the flexibility.

Question 40

four facility layout options

Answer 40

1. Process layout groups machinery and equipment according to their functions.
2. Product layout sets up production equipment along a product-flow line, and the work in process moves along this line past workstations.
3. A fixed-position layout places the product in one spot, and workers, materials, and equipment come to it.
4. Customer-oriented layout arranges facilities to enhance the interactions between customers and its services.

Question 41

four types of utility that marketing creates

Answer 41

Utility: The ability of a good or service to satisfy the wants and needs of customers.
1. Time utility by making a good or service available when customers want to purchase it.
2. Place utility by making a product available in a location convenient for customers.
3. Ownership utility through an organized transfer of goods and services from the seller to the buyer.
4. Form utility is created when raw materials or components are combined in production to create a new product.

Question 42

five eras in the evolution of the marketing concept

Answer 42

1. Production Era – the product sold itself, consumers bought what was offered.
2. Sales Era – consumers not buying the product, business worked to sell consumers what the business made.
3. Marketing Era – customer needs were identified and met, easier to sell what people wanted. “Find a need and fill it.”
4. Relationship Era – knowing the customer and working to anticipate their needs, have a product for an upcoming need. Delight the customer.
5. Social Media Era – using social media to market to and learn about customers.

Question 43

four elements in the marketing mix

Answer 43

1. Product strategy – involves the nature of the product, package design, brand names, trademarks, and product image.
2. Distribution strategy – how customers will receive their purchases, in the right quantity, at the right time and place.
3. Promotional strategy - advertising, personal selling, sales promotion, and public relations to achieve goals of informing, persuading, and influencing purchase decisions.
4. Pricing strategy – sets profitable, competitive, and justifiable prices for the firm’s product and service offerings.

Question 44

four ways to segment markets

Answer 44

1. Geographic segmentation: Dividing an overall market into similar groups on the basis of their locations.
2. Demographic segmentation: Dividing markets on the basis of various demographic or socioeconomic characteristics, such as gender, age, income, occupation, household size, stage in family life cycle, education, or ethnic group
3. Psychographic segmentation: Dividing consumer markets into groups with similar attitudes, values, and lifestyles
4. Product-related segmentation: Dividing consumer markets into groups that are based on benefits sought by buyers, usage rates, and loyalty levels.

Question 45

three consumer product categories

Answer 45

1. Convenience products: items the consumer seeks to purchase frequently, immediately, and with little effort.
2. Shopping products: typically purchased only after the buyer has compared competing products from competing retailers.
3. Specialty products: items a purchaser is willing to make a special effort to obtain.

Question 46

five classifications of business goods

Answer 46

1. Installations: Major capital items such as new factories, heavy equipment and machinery, and custom-made equipment.
2. Accessory equipment: Includes less expensive and shorter- lived capital items and involves fewer decision makers.
3. Component parts and materials: Finished business goods that become part of a final product.
4. Raw materials: Farm and natural products used in producing other final products.
5. Supplies: Expense items used in a firm’s daily operations that do not become part of the final product.

Question 47

four stages in product life cycle

Answer 47

1. introduction
2. growth
3. maturity
4. decline

Question 48

three levels of brand loyalty

Answer 48

1. Brand recognition, the consumer Is aware of the brand but does not have a preference for it over other brands.
2. Brand preference, the consumer chooses one firm’s brand over a competitor.
3. Brand insistence, the consumer will seek out a preferred brand and accept no substitute for it (the ultimate degree of brand loyalty)

Question 49

four conditions that require personal selling

Answer 49

1. Few, geographically concentrated customers
2. Product is technically complex, involves trade-ins, or requires special handling.
3. Product carries a relatively high price.
4. Product moves through direct distribution channels.

Question 50

four pricing objectives

Answer 50

1. Profitability objectives: Most firms want to charge an acceptable price (for the market) and to maximize profits.
2. Volume objectives: Pricing decisions based on increasing a company’s sales, or market share.
3. Pricing to meet competition: Match or beat the competitors’ price.
4. Prestige pricing: Establishing a relatively high price to develop and maintain an image of quality and exclusiveness.

Question 51

six alternative pricing strategies

Answer 51

1. Skimming – Intentionally high price to take advantage of the demand at a higher level.
2. Penetration – Sets a low price as a tactic, discourage competitors from entering the market, or to enter a new market.
3. Discount pricing - attract customers by dropping prices for a set period of time, sales, volume pricing, lower service levels.
4. Loss Leader – selling some items below cost to bring customers in
5. Everyday low pricing – maintaining continuous low prices Instead of using short-term price-cutting tactics like sales.
6. Competitive pricing – matching other firms’ prices (but not below) and focus their own marketing efforts on the product, distribution, and promotional elements of the marketing mix.

Question 52

three sections of the cash flow statement

Answer 52

1. Operating activities are cash payments or cash receipts from the ordinary conduct of business. Shows net income’s effect on cash flow.
2. Investing activities are cash flows out for purchase (or cash flows in from sale) of long-term investments, in equipment, land, buildings, or financial assets.
3. Financing activities are cash flows in from borrowing funds or from investments by owners, repayment of debt or payments to owners are cash outflows.

Question 53

what are the four financial statements

Answer 53

1. Balance Sheet: a statement of a forms financial position at a point in time
2. Income Statement: a financial statement that reports the firm’s profit or loss for the period of time.
3. Statement of Owner’s Equity: a record of the change in equity from the of one fiscal period to the end of the next fiscal period
4. Cash Flow Statement: a record of the sources and uses of cash during a period of time

Question 54

four needs of operating funds

Answer 54

1. Manage Daily Operations – make payroll, purchase supplies, pay rent, utilities.
2. Manage Accounts Receivable – collection from a sale is delayed, funds are needed to bridge the gap and pay bills until the funds arrive.
3. Acquire Inventory – having too little inventory can frustrate customers, too much can leave a company short of cash.
4. Capital Expenditures – long term investments can be financed through operations; paid off with cash generated.