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MGMT 390-452 | ch. 1 // The Changing Face of Business > ch. 1 The Changing Face of Business > Flashcards

ch. 1 The Changing Face of Business Flashcards

1
Q

List the 4 factors of production in the private enterprise system.

A
  1. Natural resources
  2. Human resources
  3. Capital
  4. Entrepreneurship
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2
Q

List the basic rights guaranteed to the public in the private enterprise system.

A
  1. Private property
  2. Profit
  3. Freedom of choice
  4. Fair competition
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3
Q

What is capitalism?

A

The economics system that rewards firms for their ability to perceive and serve the needs and demands of consumers is called___.

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4
Q

What is branding?

A

___ is the process of creating an identity for a good, service, or company that is readily recognized by the firm’s intended market.

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5
Q

What is a brand?

A

A name, term, sign, symbol, design, or some combination that identifies the product of one firm and differentiates it from competitiors’ offerings is known as ___.

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6
Q

What is the relationships era?

A

The ___ is the business era in which businesses seek ways to nurture customer loyalty by carefully managing every interaction.

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7
Q

What is competitive differentiation?

A

___ is the unique combination of organizational abilities and approaches that sets a firm apart from competitors in the minds of consumers.

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8
Q

What are strategic alliances?

A

___ are long-term partnerships of firms designed to improve overall competitiveness.

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9
Q

What happens in the private enterprise system?

A

In Capitalism, also known as the ___, success or failure depends on how well firms can perceive and meet customer needs and wants.

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10
Q

What is a partnership? Name one form of partnership & what it is.

A

A ___ is an affiliation of two or more companies that help each other achieve common goals. One such form of partnership is a “strategic alliance”, a partnership formed to create a competitive advantage for the businesses involved.

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11
Q

What is a business?

A

The profit-seeking activities that produce the goods and services needed by an economic system or society are collectively called ___.

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12
Q

What is outsourcing?

A

Firms engaged in ___ hire outside firms who are specialists to perform operations that were formally handled by the company’s own employees.

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13
Q

What is technology?

A

___ is the term used to describe the business application of knowledge based on science, inventions, and innovation.

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14
Q

What is competition?

A

The battle among businesses vying for consumer acceptance is known as ___.

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15
Q

What is vision?

A

___ is the managerial quality of being able to perceive marketplace needs and identify what an organization must do to satisfy them.

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16
Q

What is near shoring?

A

Outsourcing production or services to locations near a firm’s home base is called ___.

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17
Q

What is consumer orientation?

A

In the marketing era of business development, firms adopted a ___ , which means they find out what consumers want and need and then design products to meet those needs.

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18
Q

What is offshoring?

A

___ is the relocation of business processes to lower-cost locations overseas.

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19
Q

What are factors of production?

A

The four basic inputs for effective operation are collectively known as ___ which includes natural resources, capital, human resources, and entrepreneurship.

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20
Q

What are entrepreneurs?

A

Risk takers who initiate economic activity in the private enterprise system are known as ___.

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21
Q

What is diversity?

A

The ___ of the U.S. workforce enhances innovation, creativity, and sensitivity to the multicultural marketplace by blending individuals of different genders, ethnic backgrounds, cultures, religions, ages, and physical and mental abilities, and increases a firm’s change of success.

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22
Q

What is critical thinking?

A

___ skills include the ability to analyze information and assess its authenticity, accuracy, and worth; to evaluate arguments; and to identify crucial issues, problems, opportunities, and solutions.

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23
Q

What is relationship management?

A

___ is the collection of activities that build and maintain ongoing, mutually beneficial ties with customers and other parities.

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24
Q

What is transaction management?

A

Before the 1990s, businesses tended to rely on ___. This approach focused on current sales and profits instead of thinking about the future benefits of creating long-term customers.

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25
Q

What is creativity?

A

___ is the capacity to develop novel solutions and perceived organization problems and to see better and different ways of doing business.

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26
Q

What are not-for-profit organizations?

A

___ have primary objectives such as public services rather than returning a profit to their owners.

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27
Q

What is social era?

A

___ is a new approach to the way businesses and individuals interact, connect, communicate, share, and exchange information with each other in virtual communities and networks around the world.

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28
Q

T//F

In the private enterprise system, businesses are the primary providers of the goods and services needed by society

A

True

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29
Q

T//F

Not-for-profit organizations face some of the same challenges as businesses that are profit-oriented

A

True

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30
Q

T//F

While religious and charitable organizations are not-for-profits, government agencies are not.

A

False

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31
Q

T//F

Only profit-seeking organizations face competition

A

False

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32
Q 
MC
These are product inputs that are useful in their natural states:
a. natural resources
b. human resources
c. entrepreneurship
d. capital
A

a. natural resources

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33
Q 
MC
Production inputs consisting of technology, tools, information, and physical facilities are called:
a. capital
b. human resources
c. natural resources
d. entrepreneurship
A

a. capital

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34
Q 
MC
Production inputs consisting of anyone who works, including both physical and intellectual labor are called:
a. natural resources
b. human resources
c. entrepreneurship
d. capital
A

b. human resources

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35
Q 
MC
The willingness to take risks to create and operate business is known as:
a. capital
b. human resources
c. natural resources
d. entrepreneurship
A

d. entrepreneurship

36
Q

T//F

Private enterprise and capitalism are two different economic systems

A

False

37
Q

T//F

People who take the risks of pursuing a business opportunity are called entrepreneurs

A

True

38
Q

T//F

Profits are both the reward and the incentive for risk taking

A

True

39
Q

T//F

Entrepreneurship does not require taking risks

A

False

40
Q

T//F

Business competition is healthy and beneficial to consumers

A

True

41
Q

T//F

Freedom of choice means that firms will have the right to compete fairly

A

False

42
Q

T//F

Fair competition is a basic right required under the private enterprise system

A

True

43
Q

T//F

The colonial era was characterized by a factory system and the growth of large cities

A

False

44
Q

T//F

The production era marked the beginning of a major emphasis on marketing in the business world

A

False

45
Q

T//F

During the marketing era, advertisement took a back seat as a business strategy

A

False

46
Q

T//F
The relationship era is driven by information technology that allows firms to form long-term relationships with customers

A

True

47
Q

T//F

The sales era, which entailed overcoming customer resistance, was a result of the Great Depression

A

True

48
Q

T//F

Carnegie, Vanderbilt, and McCormick are examples of industrial entrepreneurs

A

True

49
Q 
MC
A partnership formed to create competitive advantage for the businesses involved is called a:
a. social responsibility
b. vision
c. strategic alliance
d. global market
A

c. strategic alliance

50
Q

MC
Managing technology means:
a. using technology to provide new goods and services for customers
b. using technology to improve customer service while lowering prices
c. being aware of new questions about business ethics and social responsibility
d. all of the above

A

d. all of the above

51
Q 
MC
Management philosophy that includes preserving the natural environment is known as:
a. social responsibility
b. global market
c. strategic alliance
d. vision
A

a. social responsibility

52
Q

T//F

More and more firms are locating business operations to lower cost locations overseas

A

True

53
Q

T//F

Internet use has hindered the ability for businesses to outscore

A

False

54
Q

T//F

Experts predict a decline in the number of older adult workers by 2030

A

False

55
Q

T//F

China and Mexico continue to be locations for production offshoring

A

True

56
Q

T//F

The nature of work has shifted towards services, with more focus on information

A

True

57
Q

Short Answer.
Describe why creativity is an important quality for today’s managers. What are some ways that potential or preexisting managers can practice channeling their creativity?

A

Creativity is the capacity to develop novel solutions to perceived organizational problems. Today’s managers will need creativity and vision to stay on top of rapidly changing technology, and to manage complex relationships in the global business environment of the fast-paced 21st century. There are several practice and mental exercises that help to cultivate creativity. For example, people can work on getting themselves to think with a different mindset by considering failures or encounters with new people as learning experiences. People can keep a pen and notepad with them at all times and record their dreams and daydreams, which might produce effective ideas or solutions to preexisting problems. Also, regular physical exercise helps the body release endorphins, which spark energy and creative thinking.

58
Q 
MC
The standards of conduct and moral values that admired companies practice are known as:
a. vision
b. creativity
c. social responsibility
d. business ethics
A

d. business ethics

59
Q

MC
The call for greater social responsibility among admired business means:
a. business should focus exclusively on short-term profit goals
b. business should focus exclusively on the interests of the owners and managers
c. management should consider the social, environmental, and economic effects of management decisions
d. management should consider giving away all the firm’s profits for good causes

A

c. management should consider the social, environmental and economic effects of management decisions

60
Q 
MC
Failure to behave ethically:
a. can be costly in the long-run
b. can damage a company's image
c. will damage efforts to build long-term customer relationships
d. all of the above
A

b. can damage a company’s image

61
Q

MC
Admired companies generate stable “profits”, which is defined as:
a. the difference between revenues and expenses which are incurred to generate revenues
b. a firm’s sales revenue over a period of time
c. the cost of domestic production
d. net sales
e. assets minus liabilities

A

a. the difference between revenues and expenses which are incurred to generate revenues

62
Q 
MC
Employees in an admired company work in an environment they find to be:
a. challenging
b. stress-free
c. simple
d. homogeneous
A

a. challenging

63
Q

T//F
A simplistic definition of business would be: All profit-seeking activities and enterprises that provide products and services needed or desired in an economic system

A

True

64
Q

T//F

More and more large firms are recognizing the value of entrepreneurial activities among their employees

A

True

65
Q

T//F

Technology is an example of capital

A

True

66
Q

T//F

The factor payment for the use of capital is profit

A

False

67
Q

T//F

The most basic freedom under the free enterprise system is the right to private property

A

True

68
Q

T//F
The industrial revolution involved mass production, the specialization of labor, and the development of machines and the railroads

A

True

69
Q

T//F

Besides creating jobs and selling products, entrepreneurship provides the benefits of innovation

A

True

70
Q

T//F

Two of the fastest growing ethnic populations in the United States are Hispanics and people of African origin

A

False

71
Q

T//F
In the 21st century, managers will have to find the best way to connect people, technology, and ethics to form strong partnerships with customers, employees, and other organizations

A

True

72
Q

T//F

Managers can expect the pace of change to slow in the future

A

False

73
Q

T//F

The marketing era introduced the idea that a firm should identify and satisfy consumer wants and needs

A

True

74
Q

T//F
Freedom of choice within the private enterprise system means that citizens can choose their own employment, purchases, and investments

A

False

75
Q 
MC
The Wealthy of Nations was written by:
a. Paul Samuelson
b. Karl Marx
c. Adam Smith
d. John Galbraith
A

c. Adam Smith

76
Q 
MC
A capitalist economic system could also be called:
a. a community interest system
b. a utopian system
c. a futile system
d. a private enterprise system
A

d. a private enterprise system

77
Q 
MC
The factor payment that rewards entrepreneurship is:
a. interest
b. profit
c. interest
d. rent
A

b. profit

78
Q 
MC
The U.S. workforce in the 21st century can be expected to:
a. require greater skill and flexibility
b. be less mobile
c. be less diverse
d. do less telecommuting
e. include fewer older workers
A

a. require greater skill and flexibility

79
Q 
MC
An entrepreneur is defined as a(n):
a. government employee
b. risk taker
c. professional manager
d. monopolist
e. executive
A

b. risk taker

80
Q 
MC
Laws that prohibit price discrimination and deceptive advertising practices are included in the right to:
a. private property
b. profits
c. freedom of choice
d. fair competition
A

b. profits

81
Q 
MC
The right to the risk taker to retain his or her after-tax earnings is the right to:
a. freedom of choice
b. fair competition
c. private property
d. profits
A

d. profits

82
Q 
MC
In the free enterprise system, the individual's right to select a career is on example of:
a. private property
b. profits
c. freedom of choice
d. fair competition
A

c. freedom of choice

83
Q 
MC
During which period did the demand for manufactured goods continue to increase, with businesses focusing on greater attention on the activities involved in producing those goods
a. production era
b. industrial era
c. marketing era
d. relationship era
e. social era
A

a. production era

84
Q

MC
The “invisible hand of competition” refers to:
a. Uncle Sam’s taxation of your earnings
b. the problem of shoplifting in American retailing
c. the way competition in a market economy produces high quality and low prices
d. the need for government regulation to ensure high quality and low prices

A

c. the way competition in a market economy produces high quality and low prices

85
Q

Application Exercise.
Jamal is preparing a presentation on the factors of production through his observations at a local book and snack shop. List the four factors of production Jamal will discuss. For each, provide a specific example that might pertain to the book and snack shop business.

A
  1. Natural Resources: The book and snack shop owner might convert sunlight into electricity using solar power panels, or some of the furniture could be manufactured locally using local timber.
  2. Capital: The book and snack shop would use technology such as a computerized point-of-sale system for the cash register, for networking with customers or potential business partners through social media sites, and working with suppliers.
  3. Human resources: The book and snack shop would have an owner would helped train staff members and keep the books and accounting records, a handful of employees serving as cashiers, and possibly one baker/cook.
  4. Entrepreneurship: The owner of the book and snack shop would have to be willing to take risks since he or she would be opening a small business during economic hardships. The owner would also need to be creative and follow a vision so that the book and snack shop would have a competitive edge that would make customers visit that particular shop over others that offered the same goods and services.
86
Q

Short Essay Questions.

Describe the private enterprise system

A

The private enterprise system is an economic system that rewards firms for their ability to perceive and serve the needs and demands of consumers. Competition in the private enterprise system ensures success for firms that meet and satisfy consumer demands. Citizens in a private enterprise system enjoy the rights to private property, profits, freedom of choice, and competition.

87
Q

Short Essay Questions.

What is relationship management, and how can it enhance business prospects?

A

In the 1990s business moved from transaction management to relationship management. Relationship management makes use of information technology, partnerships, and strategic alliances to build and sustain long-term relationships with customers, suppliers, and other outside groups. Relationship management also depends increasingly on a talented, diverse workforce to serve and understand the multicultural global market. Contributions and creativity of workers is crucial, so new employee-employer partnerships have arisen to develop and retain better relationships with customers and other outside groups. Finally, management must engage in ethical business practices and consider social responsibilities to the wider society to assure the firm’s long-term success.

MGMT 390-452 | ch. 1 // The Changing Face of Business (3 decks)

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