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BM Review

This document contains sample questions from chapters in a business textbook. The questions cover topics like the factors of production, different types of businesses and business organizations, management functions, human resources, and marketing principles. The questions are multiple choice and test understanding of key terminology and concepts from each chapter topic area.

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607 views

BM Review

This document contains sample questions from chapters in a business textbook. The questions cover topics like the factors of production, different types of businesses and business organizations, management functions, human resources, and marketing principles. The questions are multiple choice and test understanding of key terminology and concepts from each chapter topic area.

Uploaded by

Fish Super
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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CHAPTER 1

1. The total amount of money that businesses take in by selling goods and services is
called ________.
A. profit
B. revenue
C. loss
D. retained earnings

2. A(n) ____________ is a person who assumes the risk of starting a business.


A. manager
B. entrepreneur
C. private investor
D. stakeholder

3. ___________ is a measure of the general well-being and satisfaction derived from a


variety of factors including political freedom, safety, education, and a clean
environment.
A. Standard of living
B. Quality of life
C. Gross national income
D. Social satisfaction index

4. Which of the following statements about factors of production is the most accurate?
A. The five factors of production are energy, capital, labor, leadership and money.
B. Wealth creation in poor nations is slowed by chronic shortages of labor.
C. Each of the factors of production is equally important in creating wealth.
D. Entrepreneurship and knowledge are the most important in creating wealth.

5. When businesses sell to other businesses over the Internet, these transactions are
known as:
A. B2C transactions.
B. e-wholesale transactions.
C. B2B transactions.
D. intermediate e-commerce transactions.
CHAPTER 2

1. The markets for laundry detergents, soft drinks, and automobiles are dominated by just
a few sellers. Economists would classify these markets as examples of:
A. monopolistic competition.
B. perfect competition.
C. oligopolies.
D. monopolies.

2. The quantity of a good or service that producers are willing to sell at different prices
during a specific time period is known as the:
A. supply of that product or service.
B. demand for that product or service.
C. elasticity of that product or service.
D. utility of that product or service.

3. If a shortage exists for a good in a free-market economy, the:


A. price of the good will rise.
B. price of the good will fall.
C. government will order suppliers to increase the production of that good.
D. government must establish a rationing system to make sure that the good is fairly
distributed.

4. Communist values are disappearing because:


A. people in communist nations are tired of the strong religious teachings of the system.
B. communist businesses have grown too quickly and they cannot keep up with demand.
C. communist leaders are all militaristic.
D. shortages abound due to the fact that the government cannot rely on good information.

5. One of the greatest concerns associated with capitalism is that:


A. it is not very successful at creating wealth.
B. some businesspeople may let greed guide their behavior.
C. the amount of economic freedom enjoyed by consumers is very limited.
D. producers are unlikely to supply the goods and services that consumers value the
most.
CHAPTER 3

1. Due to a nation's weak currency, people may have to fall back on ____________.
A. exporting
B. bartering
C. importing
D. factoring

2. A __________ represents a long-term partnership between two or more companies


established to help each firm build competitive market advantages, without sharing the
cost of risk.
A. multinational cooperative
B. shared venture
C. global franchise
D. strategic alliance

3. Current trade data indicates that the nation of Bogusland exports more to other nations
than it imports. Bogusland has:
A. an unfavorable balance of trade.
B. a trade surplus.
C. a trade deficit.
D. a low balance of trade.

4. __________ is the practice of selling a product in foreign countries for a lower price
than the good is sold in the producing country.
A. Deflating
B. Countertrading
C. Inflating
D. Dumping

5. The theory of comparative advantage exists because:


A. there are too many products and services to choose from today.
B. customers are always comparing the quality of service from companies in the same
industry.
C. no nation can produce all the products its people want and need.
D. free-trade agreements became the trend during the past 15 years.
CHAPTER 4

1. Companies are using _____________ to communicate their corporate social


responsibility actions to their customers.
A. sales promotion
B. traditional advertising on television and radio
C. social media
D. their employees, word of mouth

2. Corporate ________ covers issues such as setting minority hiring practices,


manufacturing safe products, and minimizing pollution.
A. responsibility
B. philanthropy
C. diversity
D. structure and strategy

3. Following an ethics-based approach to decision making will normally lead to:


A. higher profits.
B. lower employee turnover.
C. lower prices.
D. more competition.

4. Creating competition between employees within the corporation:


A. can encourage employees to deceive customers.
B. should focus on improving corporate profit.
C. must be ignored when corporate ethics are developed.
D. can bring out the best in employees.

5. Which of the following is an unresolved ethical issue that surrounds global trade?
A. Product quality
B. Labor standards
C. Transportation issues
D. Time to market issues
CHAPTER 5

1. Some __________ ask members/customers to work at the organization for a number of


hours a month as part of their duties.
A. franchises
B. limited partnerships
C. mutual funds
D. cooperatives

2. A franchise can be formed:


A. only as a general partnership.
B. only as a corporation.
C. as either a corporation or partnership, but not as a sole proprietorship.
D. as a corporation, partnership or sole proprietorship.

3. When two firms which do not participate in the same industries, for example, a
software company and a fast food restaurant company, decide to merge, the result is
called a ____________ merger.
A. vertical
B. horizontal
C. linear
D. conglomerate

4. he most popular type of business for franchising is:


A. consumer wholesale firms.
B. restaurants.
C. specialty steel manufacturing.
D. medical services.

5. In a leveraged buyout, the managers of a firm, its employees, or other investors:


A. move the company elsewhere and start over.
B. obtain the assets of the company through bankruptcy proceedings.
C. borrow funds to buy out the firm's stockholders.
D. negotiate a merger with another firm to create a conglomerate.
CHAPTER 6

1. Although top managers most often possess these skills, they usually make less use of
__________ skills than supervisory managers.
A. technical
B. conceptual
C. human relations
D. empirical

2. The level of management that is directly responsible for assigning specific jobs to
workers and evaluating their daily performance is called:
A. primary management.
B. middle management.
C. supervisory management.
D. secondary management.

3. Strategic planning looks at the organization as a whole, while ________ planning


focuses on daily tasks and decisions.
A. tactical
B. strategic
C. mission
D. operational

4. When managers identify a market trend that suggests a new opportunity and then
devise a strategy to go after this new opportunity, they are involved in the function of:
A. controlling.
B. planning.
C. leading.
D. organizing.

5. The first step in controlling consists of:


A. issuing orders and explaining routines.
B. setting clear performance standards.
C. establishing a clear chain of command.
D. assigning workers to perform specific tasks.
CHAPTER 7

1. Today, human resource management has become so important that in many firms it
has become:
A. a function performed by managers in all areas of the organization.
B. the sole responsibility of the firm's legal staff.
C. a function handled only by specialists in the human resource department.
D. a function handled only by the firm's top management.

2. The ultimate resource of a firm is its:


A. business plan.
B. marketing mix.
C. capital budget.
D. employees.

3. Which of the following statements about human resource management opportunities


and challenges is most accurate?
A. The age composition of the labor force is becoming younger.
B. Workers are becoming less loyal to their firms, resulting in higher turnover.
C. Workers are now demanding that more of their compensation be in wages and salaries
and less in fringe benefits.
D. The number of workers who have received training in high-tech fields far exceeds the
number of job openings in these areas.

4. One of the most important responsibilities for professionals in the human resources
field is:
A. understanding the ethical perspective of each employee.
B. filing employee medical claims.
C. to always “right past wrongs.”
D. staying current with employment-related legislation.

5. Which of the following is an external recruitment source?


A. College placement bureaus
B. Promotion of a current employee to a new position
C. Transferring an employee in from a different office
D. Recommendations of employees
CHAPTER 8

1. Understanding consumers in marketing is considered so important that a whole area of


marketing called _____________________ emerged.
A. customer programming
B. consumer behavior
C. individual benchmarking
D. customers competency

2. A ________ marketing strategy develops products and promotions designed to please


large groups of people.
A. volume
B. mass
C. relationship
D. value

3. A firm that uses ___________ segmentation divides a market into groups based on
age, income, or level of education.
A. demographic
B. psychographic
C. perceived value
D. econometric

4. The factor that determines whether a product is classified as a consumer product or an


industrial product is:
A. the end use of the product.
B. the decision-making process used to purchase the good or service.
C. who the buyer represents.
D. whether the good is new or used.

5. The two major types of markets are the:


A. primary market and the secondary market.
B. B2B market and the C2C market.
C. consumer market and the business-to-business market.
D. target market and the niche market.
CHAPTER 9
1. We would expect the inventory turnover ratio for a ski shop to be _______ than the
turnover for a convenience store.
A. higher
B. more meaningful
C. lower
D. less helpful
2. Earnings per share, return on sales, and return on equity are examples of:
A. leverage ratios.
B. liquidity ratios.
C. equity ratios.
D. profitability ratios.

3. Many business decisions are made in hopes of improving a firm's bottom line. Which
of the following financial statements will reveal a firm's bottom line?
A. income statement
B. balance sheet
C. statement of cash flows
D. trial balance

4. The bottom line of an income statement shows the firm's:


A. retained earnings.
B. gross profit.
C. net income or net loss.
D. owners' equity.

5. Debts that are due in one year or less are classified on the balance sheet as:
A. current liabilities.
B. bonds payable.
C. callable bonds.
D. immediate expenses.
ANSWER

1 2 3 4 5
CHAPTER 1 B B B D C
CHAPTER 2 C A A D B
CHAPTER 3 B D B D C
CHAPTER 4 C A B A B
CHAPTER 5 D D D B C
CHAPTER 6 A C D B B
CHAPTER 7 A D B D A
CHAPTER 8 B B A A C
CHAPTER 9 C D A C A

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