Final Exam

Question 1

Without the audit function and GAAP, there would be very little oversight or supervision of corporate accounting practices

Answer 1

True

Question 2

Equity financing involves raising funds by promising investors a share of future profits and an ownership stake in the business.

Answer 2

true

Question 3

Which of the following types of managers oversees systems that relate to transactions between an organization and its customers or clients?

Answer 3

Marketing

Question 4

By age 31, Arjen was a plant manager in the snack-foods division. By 35, he headed the division, one of the most profitable in the corporation. Eventually, however, the company decided to relocate its corporate offices to a city far away from his relatives. Although he loved the job and thought the work was great, Arjen’s lifestyle was awful. He was on the road so often that he was giving up much of his family life. Arjen had also become disenchanted with corporate life. He saw that the closer one got to the top, the more vulnerable one’s position became. Thus, Arjen left the company to start his own snack-foods company. His thoughts and actions most clearly reveal his _______.

Answer 4

desire to determine his own destiny

Question 5

Beto is in the process of buying a computer so that he can work from home. He has recognized that his phone will not be up to the task; searched online for information about various laptops’ features, specifications, and warranties, as well as product reviews; and has weighed the various alternatives. Now, he’s made a choice and just clicked the “Place your order” button at Amazon. What step does he still need to take in the consumer buying decision process?

Answer 5

Evaluate after purchase

Question 6

Dash overheard that Ignatius was blowing the whistle on managers at Jabot Cosmetics and that a full story would appear in Sunday’s paper. Dash quickly alerted the managers, who were able to stop the newspaper from printing the article. This is an example of managers’ _______.

Answer 6

using the grapevine as a managerial tool

Question 7

The nationalization of key industries by countries such as Sweden and Norway is characteristic of a(n) _______ economy.

Answer 7

socialist

Question 8

Which of the following statements about the Sarbanes-Oxley Act is incorrect?

Answer 8

Because of the law, auditors and accountants receive monetary rewards if they find violations.

Question 9

_______ programs are used to develop products.

Answer 9

Computer-aided design (CAD)

Question 10

Statistically, one can expect about 50 percent of new businesses to fail within five years of their founding.

Answer 10

True

Question 11

Which of the following companies is an example of a manufacturer?

Answer 11

NVIDIA

Question 12

Which of the following might a company offer to try to spread production more evenly throughout the year?

Answer 12

Seasonal discount

Question 13

Claiming credit for someone else’s ideas or work or failing to meet one’s commitments in a mutual agreement are ethical issues related to_______.

Answer 13

organizational relationships

Question 14

Which of the following is false with regard to tall organizations?

Answer 14

The span of control is wide.

Question 15

Psychological pricing strategies encourage purchases to be based on rational responses rather than on emotional responses.

Answer 15

False

Question 16

During the year Cyberdyne, Inc. had $200,000 in goods available for sale. At the end of the accounting period, it had an ending inventory of $40,000. The cost of goods sold by Cyberdyne was therefore _______.

Answer 16

$160,000

Question 17

The U.S. government imposes a tax on automobiles imported from Japan, South Korea, and Germany to help American automakers. This is best described as a(n) _______.

Answer 17

protective tariff

Question 18

Location, product, function, and customer are common bases for a firm’s _______.

Answer 18

departmentalization

Question 19

The disadvantages of franchising mainly affect the franchisee because the franchisor retains a great deal of control.

Answer 19

True

Question 20

What is the most essential function of packaging?

Answer 20

To protect the product

Question 21

Southwest Airlines announced that it would distribute $667 million of its income to its employees—an amount that worked out to about six extra weeks of pay for every employee. Southwest’s payment to its employees represents _______.

Answer 21

profit sharing

Question 22

Although there are advantages and disadvantages to each departmentalization scheme, many companies find _______ to be the most practical and efficient means of conducting business.

Answer 22

more than one basis for departmentalization

Question 23

A marketing plan specifies an organization’s resources, objectives, marketing strategy, and implementation and control efforts to be used in marketing a specific product or product group.

Answer 23

True

Question 24

In 2021, Jenelle’s Jewelry had sales revenues of $1,500,000. This retailer also had expenses that totaled $800,000. What is the firm’s profit or loss amount?

Answer 24

$700,000 profit

Question 25

As the price of jeans rises, American Eagle is likely to _______.

Answer 25

increase production and thus increase the supply

Question 26

When managers attempt to spread authority widely in the lower levels of an organization, they are attempting to centralize authority.

Answer 26

False

Question 27

When considering the conversion process, human resources in the form of hair stylists are the _______ for a Super Cuts salon.

Answer 27

focus

Question 28

A firm that has no ties to a specific nation or region and operates on a worldwide scale is called a national corporation.

Answer 28

False

Question 29

A firm’s marketing activities are affected by external and generally uncontrollable forces.

Answer 29

True

Question 30

A manager’s reluctance to delegate may stem from his or her belief that the subordinate will do the work too well.

Answer 30

True

Question 31

When people or organizations foul water, air, or land, whether knowingly or unwittingly, the action is called _______.

Answer 31

Pollution

Question 32

Because of small-business competition, large companies must become more efficient and responsive to consumers’ needs.

Answer 32

True

Question 33

The results of training evaluations should not be made known to all those involved in training programs.

Answer 33

False

Question 34

Why should companies develop and introduce new products?

Answer 34

Because failing to do so can threaten the future success of the firm

Question 35

. Refer to The Craft House. Doing business on eBay allows an entrepreneur to _______.

Answer 35

create place utility

Question 36

A broad set of plans that outlines alternative courses of action when problems develop is called a strategy.

Answer 36

False

Question 37

Daranesha is setting the price for her company’s new jeans. If the total cost of manufacturing and marketing the jeans is $100 per unit, and her boss wants a markup that is 20 percent above costs, what should the selling price of the jeans be?

Answer 37

$120

Question 38

The logical outcome of the assumptions underlying Theory X is a highly controlled work situation in which managers make all decisions and workers carry them out.

Answer 38

True

Question 39

When Dell managers assume that employees accept responsibility and work toward company goals and thus also achieve personal rewards, they are using _______.

Answer 39

Theory Y

Question 40

Mathilda read the news online early in the morning before she opened her Chinese imports store for the day. She read an article about the U.S. government working to limit imports from China due to Chinese dumping on the American market and unfair Chinese national banking practices. She is concerned that she will be unable to procure products for her store and that they will be more expensive if she can. Which of the following forces in the external marketing environment is the primary source of her concern?

Answer 40

Political forces

Question 41

A limited partnership must have at least one general partner to be responsible for the partnership’s debts

Answer 41

True

Question 42

When buying a car, _______ utility also means the owner transfers to the buyer the right to use the car.

Answer 42

Possession

Question 43

Unlimited liability holds a sole proprietor personally responsible for all the debts of the business.

Answer 43

True

Question 44

IKEA strives to create a better everyday life for many people. This notion is best described as IKEA’s _______.

Answer 44

Mission

Question 45

Adnan works in the human resources department of his firm. Because human resources is a(n) _______ type of job, it does not fit directly into the company’s chain of command.

Answer 45

Staff

Question 46

If Calculated Industries were to buy out all other calculator manufacturers, what consumer right would be at stake?

Answer 46

The right to choose

Question 47

Attrition is a method of reducing the size of the workforce by permitting people who are within a few years of retirement to retire early with full benefits.

Answer 47

False

Question 48

Actor Ashton Kutcher regularly invests in promising startups and has a track record of investing in companies that will become successful such as Uber and Airbnb. How would you classify his role in financing small businesses?

Answer 48

Angel investor

Question 49

Suppose India is trying to develop its international trade in electronic components, but it lacks the money to be successful. From whom should India seek assistance?

Answer 49

The International Monetary Fund

Question 50

The consumer price index (CPI) _______.

Answer 50

is a monthly index that tracks the prices paid by consumers

Question 51

About 50 percent of small businesses in the United States currently engage in deliberate exporting.

Answer 51

False

Question 52

Job specification is a systematic procedure for studying jobs to determine their various elements and requirements.

Answer 52

False

Question 53

What is the significant advantage of small business that helps retain effective employees who could earn more at a larger firm?

Answer 53

Personal relationships with employees

Question 54

Cleversocks sells a variety of socks at many different prices. Often, customers are confused about the pricing and have a hard time making a buying decision. Cleversocks should consider using what type of pricing strategy?

Answer 54

Price lining

Question 55

Ophelia has an arrangement with Honda Motor Company to be the exclusive seller of Honda vehicles in her community. She has used her own savings, funds from her family, and an SBA loan to purchase this dealership, buy the land, construct the dealership buildings, and pay for all of the initial advertising. What is the most likely form of business she has adopted for this company?

Answer 55

She most likely has a manufacturing retail franchise.

Question 56

The Coffee Bean & Tea Leaf strives to make its cups from recyclable materials, to give back to the communities where it has facilities, to aid the communities where the coffee beans and tea leaves are harvested, and to reduce its environmental impact. Coffee Bean & Tea Leaf promotes _______.

Answer 56

sustainability

Question 57

Garland is starting a donut and ice cream business. He has spent many hours sitting in various ice cream shops and donut shops making notes about which flavors of ice cream seem most popular and which donut flavors sell out first, as well as what prices are charged for each product at the different shops. He has already determined his breakeven point and is now trying to determine how he will promote his shop. Will he rely on walk-in and phone orders or should he actively market his shop and its products to businesses and nonprofit organizations in his community? Which of the following best describes Garland’s activities?

Answer 57

Determining his marketing mix

Question 58

Within a market, a group of individuals or firms that share one or more common characteristics is called a target group.

Answer 58

False

Question 59

Priya discovered problems in coordinating the workflow going from her department to marketing. She identified some situations that needed correction and asked employees to submit suggestions for improving them. After discussing these suggestions with her employees, Priya chose two to implement and assigned a supervisor to oversee implementation. Priya’s actions suggest that she favors the _______ leadership style.

Answer 59

participative