Chapter 1&2 BTF questions (127 questions) Flashcards
BTF Questions 2024 (Chapters 1-2) 1. Which of the following is NOT a secondary objectives of a business
A. Growth Of Sales
B. Improve Productivity
C. Reduce labour turnover
D. Increase shareholder wealth
1 D The primary objective that is profit maximization ultimately aims to increase shareholder wealth
- Mr. Boula-Constantino buys stuff often from Mayor and Dolce’s Groceria. What do you think he expects from the store every time he comes to buy their products?
A. Fair Terms Of Trade
B. Prompt Payment
C. Pension
D. Safe Working Environment
2 A The answer is (A) as Mr. Boula-Constantino is a customer. Prompt payment is expected by suppliers. Pension and a safe working environment are expected by directors/managers and employees/trade unions.
- Madame Salmona likes to eat salmon. She ate it everyday in fact. In her youth, her father ran a small bakery in the middle of town. Each day, she would go out and catch salmon for her father so that her father can make his famous Salmon Au Pan Rustic, a special French baguette with salmon as its filling. As she grew up, she found fishing salmon to be pretty fun and so she set up a company to fish salmon in large quantities. As this was her business, she would frequently take a small batch of salmon back to her house out of the ones which were caught to can for her personal use. One day, one of her friends came for tea and tried it and suggested to Madame Salmona to sell some of canned salmon around the neighborhood as they were very good. In which Madame Salmona did over the next three years. The question now is, what industry does her organization specialize in?
A. Manufacturing
B. Service Industry
C. Agriculture
D. Retailing
3 C The answer is (C). (B) is most definitely out of the picture as she runs no service industry and (A) and (D) is wrong as the questions asks what does her ‘organization’ specialize in. The answer is (C) as her real organization specializes is catching and selling salmon which is also her main form of business.
- A company director writes a statement stating he wishes to spend or invest more in its Research and Development programme in order to improve its technology. Which statement is it referring to?
A. Mission
B. Goal
C. Primary objective
D. Secondary objective
4 D Technology is one of the secondary objectives that support the primary objective of wealth maximisation of its owners.
- The Commercial Banking Manager of HSBC Petaling Jaya has communicated to its direct operational staff to improve on the time taken to serve customers. The manager has set a Key Performance Indicator (KPI) of 5 minutes per customer as a target to be achieved. What kind of standard has the manager of HSBC Petaling Jaya implemented?
A. Quality Standard
B. Cost Standard BTF Questions 2024 (Chapters 1-2)
C. Physical Standard
D. None of the above
5 A Improving on time taken to serve customers does not reflect (B) Cost Standard or (C) Physical Standard thus it refers to (A) Quality Standards as it can take a variety of forms.
- A statement about what an organization wants to become, which sets out an organization’s long term future, is referred to as:
A. Mission
B. Vision
C. Primary objective
D. Secondary objective
6 B Vision is a statement about what an organization wants to become. It should give shape and direction to an organization’s future. A vision should stretch an organization in terms of its current position and performance yet at the same time it should help employees feel involved and motivated to be part of the organization’s future.
- A statement that sets out what the organization purpose is and wishes to achieve in the long term is referred to as:
A. Mission
B. Vision
C. Primary objective
D. Secondary objective
7 A Mission represents what the organization wishes to achieve in the long term. A mission applies to all parts of an organization and in that sense serves to bind the many parts of an organization together.
- Organisations differ in many ways. Which two of the following ways does a public company in the fast food industry differ from a general partnership in the same industry?
A. Activity
B. Legal status
C. Sources of finance
D. Profit or non-profit orientation
8 B, C Both organisations have the same activity and profit orientation. However, a public company has a legal status of a separate entity while a partnership has no separate entity. The sources of finance also differ.
- Two of Moonlight Tours plc.’s stakeholder groups are putting the company under pressure to show more concern for the welfare of their employees. These are most likely to comprise which TWO of the following groups?
A. Customers
B. The public at large
C. The government
D. Lenders
9 B,C The public at large and the government are stakeholders who have concern for the welfare of employees in any business. Customers are concerned about their custom and lenders, about the money lent to the business.
- Which two of the following is the element of mission?
A. Purpose
B. Vision
C. Policies and standards of behaviour
D. Aim
10 A, C Purpose, Values, Policies and Standards; Strategy are elements of a Mission.
- Objectives set should have which of the following characteristics?
A. Time-bound
B. Measurable
C. Sustainable
D. Suitable E. None of the above
11 A, B Objectives should be SMART: Specific, Measurable, Achievable, Relevant, Time-bound
BTF Questions 2024 (Chapters 1-2) 12. What is the common expectation of customers, suppliers and business partners?
A. Fair terms of trade
B. Prompt Payment
C. Continuity of Custom
D. Interest
12 A (B)Prompt payment and (C) Continuity of custom is expectation of suppliers and business partner but not customers. (D) Interest is expectation of lenders.
- Which THREE of the following are mission statements of a business produces handbags?
A. We will be the most popular brand among ladies in the world.
B. We aim to increase 20% revenue in five year.
C. We will use the latest technology in production systems.
D. We intend to produce handbags in newest design. E. We will reduce producing leather handbags up to 30%. F. We intend to join venture with Gucci.
13 A,C,D Mission is the reason for an organisation to exist, so its statement should be general. BTF Questions 2024 (Chapters 1-2)
- The operational goal for Hi-Technology plc. is to lower the cost of production of the smartphones by 5% by 2016 which last year was 4%. Which of the following characteristics of SMART is the goal lacking of?
A. Specific
B. Measurable
C. Achievable
D. Relevant E. Time-bounded F. None of the above
14 F The operational goal is specific by stating the company wants to lower the cost of production by 5% and it is measurable and achievable. The goal is relevant to the company as smartphones production is the main activity of the business. The date of 2016 is time-bounded
- In the past 3 years, directors of Squek Plc. have run the company in a way that is structured to solely increase their prestige in the business. According to Baumol, this is often referred to as:
A. Wealth maximisation
B. Maximisation of sales revenue
C. Cost minimisation
D. Minimisation of social impact
15 B Baumol argued that businesses act to maximise sales revenue wherever managers are rewarded or revered for the size of the organisation for which they work rather than its profitability or performance
- To see whether an organisation is a business or not, it would be necessary to enquire as to the nature of its:
A. Primary objective
B. Mission
C. Vision
D. Secondary objective
16 A Organisations whose primary objective is to make profits for their owners are classified as businesses
- How do managers benefit personally from revenue maximisation? (Choose two answers)
A. Increase of company’s market share.
B. Increase of salaries.
C. Decrease of intensity of rivalry. BTF Questions 2024 (Chapters 1-2)
D. Prestige of running a successful company.
17 B,D Managers benefit personally because of the prestige of running a large and successful company, and because salaries and other benefits are likely to be higher.
- The chief executive of Summerbay Travel is currently involved in preparing a brochure outlining the services provided by the travel agency. In that document the chief executive hopes to see the agency become the largest travel agency in Malaysia by 2020. The executive is stressing the agency’s:
A. Vision
B. Mission
C. Primary objective
D. Secondary objective E. Aim F. Strategy
18 A Vision concern how the agency sees itself at some future time.
- Cashewnut plc’s objective for its marketing department is ‘increasing sales within a year’. On which of the SMART criteria for objectives does this objective fail?
A. Specific
B. Measurable
C. Relevant
D. Time-bounded
19 B The objective is time-bound and specific, and being related to the marketing division it can be said to be relevant. However, there’s no clue of how much the ‘increase’ is to be measured.
- ABC Aid is a charity providing medical services in cities in UK. The chief executive is currently involved in preparing an information document outlining the services provided by the charity. In that document, the chief executive hopes to stress that in providing its services the charity is always seeking to operate at maximum efficiency. In stressing this aspect of the charity’s operation, the chief executive is highlighting the charity’s?
A. Vision
B. Mission
C. Primary Objective
D. Secondary Objective
20 D The primary objective of a non-profit organization is provision of medical services, while doing this efficiently would be an example of secondary objective.
- For each of the following statements, select the one with the operational objective.
A. Customers expect good quality of products or services from business. Banana Car Rental Ltd aims to satisfy all their customers by giving flexible services based on their requirement.
B. Banana Car Rental Ltd plan to increase their revenue by 20% in the next two years.
C. Banana Car Rental Ltd provides training to their workers for better skill development.
21 B A. Non-operational aim is the qualitative goal. Customer satisfaction will change when circumstances change. It is hard to measure and quantify. B. Operational objective is the quantitative goal. The objective is measurable (revenue increase by 20%) and time-bound (the deadline to complete the objective is in the next two year). C. Train their worker for BETTER skill development is not a measurable term, thus the answer is non-operational aim.
- Jacqueline is the managing director of Wongaline Plc. As a risk averse person, she always prioritizes the minimisation of risks. Due to recent relaxation of government regulations, there has been a sharp increase in the number of new entrants into the industry. In response to this, Jacqueline and the other directors decide to reduce the prices of Wongaline Plc’s products to retain market share. BTF Questions 2024 (Chapters 1-2) They believe this is the best strategy to protect Wongaline Plc’s prestige in the industry, and hence protect the prestige of their jobs. What is most likely Wongaline Plc.’s current objective?
A. Profit maximisation
B. Wealth maximisation
C. Revenue maximisation
D. Satisficing profits
22 C The main reason behind the reduction in prices is to retain Wongaline Plc’s market share in the industry - by forcing out any new competitors, and discouraging any potential competitors from entering the industry. To do so, Wongaline Plc is hoping that customers respond to the lower prices by buying Wongaline Plc’s products, thus increasing sales, and possibly, sales revenue.
- In a high-competition and slow-growth industry, a company has a mission of increasing the company’s sales by 30% within one year. Which two of the following criteria are not satisfied by this mission?
A. Specific
B. Measurable
C. Achievable
D. Relevant E. Time Bounded
23 C,D Due to the current conditions faced by the industry - a mission of increasing sales might not be achievable or relevant.
- “Our priority will be focused on generating the revenue effectively instead of increasing the wealth of shareholders.”, said Mr. Bingsu. However, it was reported that the shareholders were pleased and satisfied with the company’s generated profit. This demonstrates that the top managerial staff practices. . .
A. Profit satisficing
B. Wealth maximisation
C. Revenue maximisation
D. Profit maximisation
24 A Shareholders were pleased and satisfied despite the wealth of shareholders not prioritized