The Ultimate Business Fundamentals Quiz!
Questions and Answers
- 1.
The amount of goods and services people can buy with the money they have is called their:
- A.
Nominal income
- B.
Consumer price index
- C.
Profit margin
- D.
Standard of living
Correct Answer
D. Standard of livingExplanation
Standard of living refers to the level of wealth, comfort, material goods, and necessities available to an individual or a community. It is a measure of the quality of life and reflects the amount of goods and services that people can afford to purchase with their income. Therefore, the correct answer is standard of living.Rate this question:
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- 2.
An entrepreneur risks time and money to start and manage a business
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Starting and managing a business requires a significant investment of both time and money. Entrepreneurs often invest their own personal savings or seek funding from investors to finance their business ventures. Additionally, they dedicate a substantial amount of time and effort to develop and grow their businesses. This involves conducting market research, creating business plans, hiring and managing employees, and making strategic decisions. Therefore, it can be concluded that entrepreneurs do indeed risk both time and money to start and manage a business, making the answer "True."Rate this question:
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- 3.
Backstreet Books, an eclectic bookstore on a large college campus generated total revenues of $15 million while incurring expenses of $12 million. During the year Backstreet Books earned a profit of $3 million
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
The statement is true because the profit earned by Backstreet Books is calculated by subtracting the expenses from the total revenues. In this case, the total revenues are $15 million and the expenses are $12 million, resulting in a profit of $3 million.Rate this question:
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- 4.
Political freedom, quality education, access to health care, and a clean environment are all factors that contribute to an improved quality of life.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
The statement is true because political freedom allows individuals to have a say in their government and participate in decision-making processes, leading to a sense of empowerment and autonomy. Quality education ensures that individuals have the necessary skills and knowledge to succeed in life, opening up opportunities for better employment and personal growth. Access to healthcare ensures that individuals can receive necessary medical treatment and live a healthier life. A clean environment promotes physical and mental well-being, reducing the risk of diseases and providing a pleasant living environment. All these factors contribute to an improved quality of life.Rate this question:
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- 5.
Productivity is the amount of output you generate given the amount of input such as hours worked.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Productivity refers to the efficiency and effectiveness with which individuals, organizations, or systems convert inputs into outputs. It measures the amount of output produced relative to the amount of input used. In this context, the statement correctly states that productivity is the amount of output generated based on the input, such as hours worked. Therefore, the answer "True" is correct.Rate this question:
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- 6.
Empowerment means giving frontline workers the responsibility, authority, and freedom to respond quickly to customer requests.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Empowerment refers to the act of granting frontline workers the power and autonomy to promptly address customer demands. This includes providing them with the responsibility, authority, and freedom to take necessary actions and make decisions without constant supervision or approval. By doing so, organizations enable their employees to respond swiftly and effectively to customer requests, leading to improved customer satisfaction and overall business success.Rate this question:
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- 7.
The customers, employees, stockholders, suppliers, creditors, and others who stand to gain or lose by the policies and activities of a business represent the firm's:
- A.
Market makers
- B.
Economic environment
- C.
Stakeholders
- D.
Social mentors
Correct Answer
C. StakeholdersExplanation
The customers, employees, stockholders, suppliers, creditors, and others who stand to gain or lose by the policies and activities of a business are referred to as stakeholders. These individuals or groups have a vested interest in the success of the business and can influence its operations and outcomes. They may include individuals who have invested in the company, rely on its products or services, or have a business relationship with the company. By considering the needs and interests of stakeholders, a business can make decisions that align with their expectations and ultimately contribute to its overall success.Rate this question:
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- 8.
The resources that contribute to the creation of wealth are known as ________.
- A.
Production coefficients
- B.
Factors of production
- C.
Production technologies
- D.
Production agregates
Correct Answer
B. Factors of productionExplanation
Factors of production are the resources that contribute to the creation of wealth. These resources include land, labor, capital, and entrepreneurship. Land refers to natural resources such as land itself, minerals, and water. Labor refers to the human effort involved in production. Capital refers to the tools, machinery, and infrastructure used in production. Finally, entrepreneurship refers to the ability to organize and combine these resources to create goods and services. Together, these factors of production play a crucial role in economic growth and wealth creation.Rate this question:
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- 9.
Efficiency means:
- A.
Producing the desired result.
- B.
Producing goods and services using the least amount of resources.
- C.
The amount of output you generate given the amount of input.
- D.
The buying and selling of goods using the most amount of resources.
Correct Answer
B. Producing goods and services using the least amount of resources.Explanation
Efficiency refers to the ability to produce goods and services using the least amount of resources. It emphasizes maximizing output while minimizing input. This means that the desired result is achieved with the least possible waste of time, money, energy, or any other resources. Efficiency is a key factor in optimizing productivity and reducing costs in various industries and sectors.Rate this question:
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- 10.
The two main types of e-commerce are:
- A.
Online and offline.
- B.
EDI and EDC.
- C.
Wholesale and retail
- D.
B2B and B2C
Correct Answer
D. B2B and B2CExplanation
The correct answer is B2B and B2C. B2B (Business-to-Business) refers to transactions between businesses, where one business sells products or services to another business. B2C (Business-to-Consumer) refers to transactions between businesses and individual consumers, where businesses sell products or services directly to consumers. These two types of e-commerce represent the primary ways in which businesses engage in online transactions, either with other businesses or with individual consumers.Rate this question:
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- 11.
Macroeconomics is the economic perspective that looks at the operation of a nation's economy as a whole.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Macroeconomics is the study of the overall behavior and performance of an economy, including factors such as inflation, unemployment, economic growth, and government policies. It focuses on analyzing aggregate measures such as GDP, national income, and overall price levels to understand how the economy as a whole functions. Therefore, the statement that macroeconomics looks at the operation of a nation's economy as a whole is true.Rate this question:
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- 12.
Microeconomics focuses on the decisions and behavior of people and organizations in particular markets.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Microeconomics is a branch of economics that studies the behavior and decisions of individuals, households, and firms in specific markets. It examines how individuals and organizations allocate resources, make production and consumption choices, and interact with each other in these markets. Therefore, the statement that microeconomics focuses on the decisions and behavior of people and organizations in particular markets is true.Rate this question:
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- 13.
In capitalist countries, the government decides what to produce and how the goods and services will be produced
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
In capitalist countries, the government does not decide what to produce and how goods and services will be produced. Instead, these decisions are made by private individuals and businesses based on market demand and competition. In a capitalist system, the government's role is typically limited to creating and enforcing laws and regulations to ensure fair competition and protect consumers.Rate this question:
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- 14.
Demand refers to the quantity of a good that consumers are willing and able to buy at different prices at a specific time.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
This statement is true because demand refers to the willingness and ability of consumers to purchase a specific quantity of a good at different prices. It is a fundamental concept in economics that helps to determine the relationship between price and quantity demanded. The demand for a good can vary depending on factors such as price, income, preferences, and availability. Therefore, the statement accurately defines demand as the quantity of a good that consumers are willing and able to buy at different prices at a specific time.Rate this question:
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- 15.
The point of intersection between the supply and demand curves is called the stress point.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
The statement is false because the point of intersection between the supply and demand curves is actually called the equilibrium point. This is the point where the quantity demanded by consumers matches the quantity supplied by producers, resulting in a balance in the market. The stress point, on the other hand, refers to a situation where there is an imbalance between supply and demand, leading to either excess supply or excess demand.Rate this question:
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- 16.
Which of the following is a basic right under capitalism?
- A.
Freedom of collusion
- B.
Freedom from taxation.
- C.
The right to vote.
- D.
The right to compete.
Correct Answer
D. The right to compete.Explanation
In capitalism, individuals have the right to compete freely in the market without any restrictions or monopolies. This means that businesses can enter the market, offer their products or services, and compete with other businesses on a level playing field. This right encourages innovation, efficiency, and consumer choice, as it allows for a healthy competitive environment where businesses strive to provide better products and services at competitive prices.Rate this question:
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- 17.
A simple supply curve shows that an increase in the price of a good will cause the quantity supplied to:
- A.
Decrease.
- B.
Increase.
- C.
Remain constant.
- D.
Fluctuate randomly around its equilibrium value.
Correct Answer
B. Increase.Explanation
A simple supply curve shows that an increase in the price of a good will cause the quantity supplied to increase. This is because as the price of a good increases, producers are motivated to supply more of it in order to maximize their profits. Higher prices make it more profitable for producers to allocate more resources and increase production, resulting in an increase in the quantity supplied.Rate this question:
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- 18.
A typical demand curve shows that:
- A.
As people earn more income, they buy more of a good
- B.
As supply increases, the amount purchased decreases.
- C.
People tend to buy more of a good than they really want.
- D.
People tend to buy more of a good when its price decreases.
Correct Answer
D. People tend to buy more of a good when its price decreases.Explanation
A typical demand curve shows that people tend to buy more of a good when its price decreases. This is because as the price of a good decreases, it becomes more affordable and attractive to consumers. As a result, the quantity demanded increases. This relationship between price and quantity demanded is represented by a downward-sloping demand curve. When prices are high, consumers may be less willing or able to purchase the good, leading to a decrease in quantity demanded. Conversely, when prices are low, consumers are more likely to buy the good, resulting in an increase in quantity demanded.Rate this question:
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- 19.
__________ exists when the entire supply of a good is controlled by a single seller.
- A.
Perfect competition
- B.
Oligopoly
- C.
Pure Capitalism
- D.
A monopoly
Correct Answer
D. A monopolyExplanation
A monopoly exists when the entire supply of a good is controlled by a single seller. In this market structure, there is no competition as the monopolistic seller has the power to set prices and dictate the terms of trade. This lack of competition can lead to higher prices, reduced consumer choice, and potentially lower quality goods or services.Rate this question:
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- 20.
An oligopoly is a market that is characterized by:
- A.
One firm that totally dominates the supply of the product.
- B.
A large number of small firms all producing very similar products.
- C.
A few large sellers who dominate the market.
- D.
Several small firms that compete primarily by differentiating their products.
Correct Answer
C. A few large sellers who dominate the market.Explanation
An oligopoly is a market structure in which there are only a few large sellers who dominate the market. In an oligopoly, these dominant sellers have significant control over prices and can influence market conditions. This market structure is characterized by barriers to entry, interdependence among firms, and differentiated or similar products. The presence of a few large sellers distinguishes oligopoly from other market structures such as monopoly (one dominant seller) or perfect competition (large number of small firms).Rate this question:
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- 21.
Importing is the selling of products to another country.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
The given statement is false. Importing refers to the buying and bringing in of products from another country, not the selling of products to another country.Rate this question:
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- 22.
Exporting is the selling of products to another country.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Exporting refers to the act of selling products or goods to another country. This involves the transfer of goods or services from one country to another, typically for trade purposes. Therefore, the statement "Exporting is the selling of products to another country" is correct.Rate this question:
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- 23.
The country of Nelly exports $250 of goods and services and imports $170 of goods and services. Nelly has an unfavorable balance of trade of $80.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
An unfavorable balance of trade, or trade deficit, occurs when the value of imports exceeds that of exports. In this case, Nelly has a favorable balance of trade of $80.Rate this question:
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- 24.
Foreign direct investment refers to the buying of goods produced in another country
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
Foreign direct investment refers to the investment made by a company or individual from one country into a business or project located in another country. It involves the acquisition of assets, such as stocks, bonds, or real estate, and does not specifically refer to the buying of goods produced in another country. Therefore, the statement "Foreign direct investment refers to the buying of goods produced in another country" is false.Rate this question:
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- 25.
A complete ban on the import or export of a specific good is called an embargo
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
An embargo refers to a complete prohibition or ban on the import or export of a specific good. This means that no trade or exchange of the particular good is allowed between countries or regions. Therefore, the statement "A complete ban on the import or export of a specific good is called an embargo" is true.Rate this question:
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- 26.
Granting a foreign company the right to manufacture your product or to use your firm's trademark in return for a fee is called:
- A.
A joint venture.
- B.
A foreign subsidiary.
- C.
Licensing.
- D.
Outsourcing.
Correct Answer
C. Licensing.Explanation
Licensing refers to the practice of granting permission to a foreign company to manufacture a product or use a firm's trademark in exchange for a fee. This allows the foreign company to legally produce and sell the product or use the trademark in their own market, while the original company retains ownership and receives financial compensation. Joint ventures involve two or more companies forming a separate entity to collaborate and share resources, while a foreign subsidiary refers to a company established and controlled by a foreign parent company. Outsourcing involves contracting a third-party company to perform certain tasks or functions on behalf of the original company.Rate this question:
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- 27.
__________ is an arrangement whereby someone with a good idea for a business sells the rights to use the business name and sell the parent company's product or service to others in a given territory in a specified manner.
- A.
Franchising
- B.
Contract manufacturing
- C.
Import trading
- D.
Export trading
Correct Answer
A. FranchisingExplanation
Franchising is an arrangement where an individual sells the rights to use a business name and sell the parent company's product or service to others in a specified manner and territory. This allows the individual, known as the franchisee, to benefit from an established brand, business model, and support system provided by the parent company, known as the franchisor. The franchisee pays fees or royalties to the franchisor in exchange for the rights and support. This arrangement enables the franchisor to expand their business rapidly while allowing the franchisee to operate their own business with the support of a recognized brand.Rate this question:
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- 28.
When a company's strategy is __________ the firm makes arrangements for a foreign manufacturer to produce the product. The domestic company's label and/or trademark are attached to the completed product.
- A.
Franchising
- B.
Contract manufacturing
- C.
Import sourcing
- D.
Export trading
Correct Answer
B. Contract manufacturingExplanation
Contract manufacturing is the correct answer because it refers to a company's strategy of outsourcing the production of its products to a foreign manufacturer. In this arrangement, the domestic company provides the design, specifications, and brand identity, and the foreign manufacturer produces the product according to these requirements. The domestic company's label and trademark are then attached to the finished product, allowing them to sell it under their own brand. This strategy is often used when a company wants to take advantage of lower production costs or specialized expertise available in other countries.Rate this question:
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- 29.
A __________ is a partnership in which two or more companies (often from different countries) join together and share the risk and costs in order to undertake a major project.
- A.
Multinational cooperative
- B.
Joint venture
- C.
Franchisee transfer
- D.
Recruit affiliation
Correct Answer
B. Joint ventureExplanation
A joint venture is a partnership in which two or more companies, often from different countries, come together to undertake a major project. In a joint venture, the companies share the risk and costs associated with the project. This allows them to combine their resources, expertise, and market knowledge to achieve a common goal. Joint ventures are often formed when companies want to enter a new market or expand their operations globally, as it allows them to leverage each other's strengths and minimize individual risks.Rate this question:
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- 30.
10. (p. 70) A form of foreign direct investment, where a domestic company purchases a company in a foreign country to produce a similar product or service is a:
- A.
Licensor
- B.
Joint venture
- C.
Foreign subsidiary
- D.
Host company
Correct Answer
C. Foreign subsidiaryExplanation
A foreign subsidiary is a form of foreign direct investment where a domestic company acquires a company in a foreign country to produce a similar product or service. This allows the domestic company to expand its operations internationally and gain access to new markets. By purchasing a foreign company, the domestic company can leverage the existing infrastructure, resources, and market knowledge of the foreign company to establish a presence in the foreign market more quickly and efficiently. This strategy also allows the domestic company to maintain full control over the operations and decision-making of the subsidiary.Rate this question:
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- 31.
Overly ambitious business goals and employee incentives can lead to unethical behavior.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
When businesses set overly ambitious goals and offer high incentives to employees, it can create a high-pressure environment that may push individuals to engage in unethical behavior. The desire to achieve these goals and earn rewards can lead employees to cut corners, manipulate data, or engage in other unethical practices. This can harm the company's reputation, lead to legal issues, and damage employee morale. Therefore, it is true that overly ambitious business goals and employee incentives can contribute to unethical behavior.Rate this question:
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- 32.
In order to be successful, efforts to improve the ethical behavior of businesses must begin with top management's support of a corporate code of conduct.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Efforts to improve the ethical behavior of businesses must begin with top management's support of a corporate code of conduct because top management sets the tone and example for ethical behavior within an organization. They have the power and influence to establish and enforce ethical standards, create a culture of integrity, and hold employees accountable for their actions. Without top management's support, efforts to improve ethical behavior may lack credibility and effectiveness, as employees may not see ethical behavior as a priority or may feel that they can get away with unethical practices.Rate this question:
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- 33.
People who report illegal or unethical behavior are called whistleblowers.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Whistleblowers are individuals who expose or report illegal or unethical activities within an organization or society. They play a crucial role in bringing attention to wrongdoing and promoting transparency and accountability. By speaking out against such behavior, whistleblowers often face risks and potential backlash. However, their actions are essential for safeguarding the public interest and ensuring that justice is served. Therefore, the statement that people who report illegal or unethical behavior are called whistleblowers is true.Rate this question:
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- 34.
Enforcement is perhaps the most important step in an effective code of ethics
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Enforcement is indeed a crucial step in an effective code of ethics. Without proper enforcement, a code of ethics becomes merely a set of guidelines without any real consequences for non-compliance. Effective enforcement ensures that individuals and organizations are held accountable for their actions and that ethical standards are upheld. It helps to create a culture of integrity and trust, as well as deter unethical behavior. Therefore, the statement "Enforcement is perhaps the most important step in an effective code of ethics" is true.Rate this question:
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- 35.
Insider trading occurs when employees of publicly traded companies use private company information to profit in the stock market.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Insider trading refers to the illegal practice of using confidential information about a company, which is not available to the public, to make stock market transactions for personal gain. This information is typically known only to employees or individuals with access to non-public company data. By trading based on this privileged information, insiders can potentially make significant profits or avoid losses. Therefore, the statement "Insider trading occurs when employees of publicly traded companies use private company information to profit in the stock market" is true.Rate this question:
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- 36.
When WorldCom used intentional accounting irregularities to make the company look more profitable than it actually was, it:
- A.
Provided its stockholders profit through a tax-loophole
- B.
Acted in an acceptable business manner.
- C.
Engaged in illegal behavior
- D.
Executed its responsibility to its owners
Correct Answer
C. Engaged in illegal behaviorExplanation
WorldCom engaged in illegal behavior by using intentional accounting irregularities to make the company appear more profitable than it actually was. This deceptive practice violated accounting laws and regulations, and was a clear breach of ethical standards. By manipulating financial statements, WorldCom misled its stockholders and the public, which is not acceptable in any legitimate business. The company's actions were fraudulent and resulted in significant financial losses for investors, leading to its eventual bankruptcy and the conviction of several top executives.Rate this question:
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- 37.
Which of the following would most likely involve ethical concerns?
- A.
Overstating an expense report
- B.
Forecasting sales for the next year
- C.
Developing the marketing plan for the next year.
- D.
Improving working conditions.
Correct Answer
A. Overstating an expense reportExplanation
Overstating an expense report is likely to involve ethical concerns because it involves intentionally misrepresenting financial information. This action can be considered dishonest and unethical as it deceives others and may result in financial gain for the individual responsible. It goes against principles of honesty, integrity, and transparency, which are important ethical values in business and finance.Rate this question:
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- 38.
Sharon, a CPA for a large firm noticed that the company's accounting records drastically overstated the amount of inventory on hand, which led to overstating the assets of the firm. Initially, she brought it to the attention of her supervisor, but when nothing was done to correct the mistake in a timely manner; she decided the best course of action was to report it to the appropriate government official. Although her actions took her outside the company, she was counting on current law, under the ____________ to protect her against company retaliation.
- A.
Cellar-Kefauver Act
- B.
Sarbanes-Oxley Act
- C.
Robinson-Patman Act
- D.
Sherman Act
Correct Answer
B. Sarbanes-Oxley ActExplanation
The Sarbanes-Oxley Act was passed in 2002 to protect whistleblowers from intentional company retaliation when reporting illegal and/or unethical accounting concerns to government authorities. Also known as the Corporate and Criminal Fraud Accountability act, it protects employees who report accounting and auditing concerns to the government from being discriminated against by their firms.Rate this question:
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- 39.
We describe charitable donations by corporations to nonprofit organizations as
- A.
Corporate philanthropy
- B.
Corporate responsibility
- C.
Corporate strategy
- D.
Structural commitment
Correct Answer
A. Corporate philanthropyExplanation
Corporate philanthropy refers to the act of corporations donating money, resources, or time to nonprofit organizations or charitable causes. It is a way for corporations to give back to society and support initiatives that align with their values. This term accurately describes the concept of charitable donations made by corporations to nonprofit organizations.Rate this question:
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- 40.
Entrepreneurship involves accepting the risk of starting and running a business.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Entrepreneurship involves taking on the risk of initiating and managing a business. Entrepreneurs are willing to step out of their comfort zones and invest their time, money, and effort into a new venture, knowing that success is not guaranteed. They embrace uncertainty and are prepared to face challenges and setbacks along the way. By accepting the risk, entrepreneurs have the opportunity to pursue their ideas, create innovative products or services, and potentially achieve financial rewards and personal fulfillment.Rate this question:
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- 41.
The most important difference between entrepreneurs and micropreneurs is the focus placed by micropreneurs on balancing the demands of work and family.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Micropreneurs are individuals who start and operate small businesses with a focus on maintaining a work-life balance. They prioritize their family commitments and integrate them into their work schedule. On the other hand, entrepreneurs are generally more focused on the growth and success of their businesses, often sacrificing personal and family time for work. Therefore, the statement that micropreneurs place a greater emphasis on balancing work and family demands is true.Rate this question:
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- 42.
Creative people working as entrepreneurs within a large organization are called intrapreneurs.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Creative individuals who work as entrepreneurs within a large organization are commonly referred to as intrapreneurs. These individuals exhibit entrepreneurial qualities such as innovation, risk-taking, and problem-solving within the confines of an established company. They often drive new ideas, develop new products or services, and contribute to the growth and success of the organization. Therefore, the statement "Creative people working as entrepreneurs within a large organization are called intrapreneurs" is true.Rate this question:
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- 43.
Small businesses account for over 50% of the U.S.'s gross domestic product (GDP)
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Small businesses account for over 50% of the U.S.'s gross domestic product (GDP). This means that the combined economic output of small businesses in the U.S. is greater than 50% of the total economic output of the country. Small businesses play a significant role in driving economic growth and creating jobs, making them an important component of the U.S. economy.Rate this question:
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- 44.
A good business plan describes key items such as the nature of the proposed business, the target market, the competitive advantages, and the qualifications of the owners
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
A good business plan is essential for any successful venture as it provides a comprehensive overview of the proposed business. It includes important details such as the nature of the business, the target market it aims to serve, the competitive advantages it possesses, and the qualifications of the owners. These key items help potential investors, partners, and stakeholders understand the viability and potential success of the business. Therefore, it is true that a good business plan describes these crucial elements.Rate this question:
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- 45.
A detailed written statement that describes the nature of the business, the target market, the firm's competitive advantages, as well as the owner's resources and qualifications is a:
- A.
Business plan
- B.
entrepreneurial mission statement.
- C.
Profit and loss statment
- D.
Professional action plan
Correct Answer
A. Business planExplanation
A detailed written statement that describes the nature of the business, the target market, the firm's competitive advantages, as well as the owner's resources and qualifications is referred to as a business plan. This plan outlines the goals and objectives of the business, the strategies to achieve them, and the financial projections. It serves as a roadmap for the entrepreneur, providing a comprehensive overview of the business and its potential for success.Rate this question:
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- 46.
After personal savings, the next largest source of capital for entrepreneurs is from:
- A.
large multinational banks.
- B.
Small business administration
- C.
State and local governments
- D.
Friends and family
Correct Answer
D. Friends and familyExplanation
Entrepreneurs often rely on friends and family for capital because they are more likely to receive financial support from people they have personal relationships with. This is especially true in the early stages of starting a business when traditional sources of funding, like banks or government agencies, may be hesitant to invest. Friends and family may be willing to provide loans or investments based on trust and belief in the entrepreneur's abilities. Additionally, this source of capital allows entrepreneurs to retain more control over their business compared to seeking funding from larger institutions.Rate this question:
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- 47.
A ________ refers to people with unsatisfied wants and needs who are willing and able to buy a product or service.
- A.
Market
- B.
Consumer cooperative
- C.
Consumer collective
- D.
Buyers cooperative
Correct Answer
A. MarketExplanation
A market refers to a group of people who have unfulfilled desires and needs and are both willing and capable of purchasing a product or service. This group of individuals forms the target audience for businesses and plays a crucial role in the demand and supply dynamics of the economy. The concept of a market encompasses not only the buyers but also the sellers, creating a platform for exchange and trade.Rate this question:
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- 48.
A market consists of potential buyers of a good or service. However, for a market to exist:
- A.
the business requires wholesalers and retailers.
- B.
One firm must dominate in sales and product development.
- C.
People must have unsatisfied wants and needs as well as a willingness and ability to buy.
- D.
The product must be laboratory tested and approved by the Food and Drug Administration (FDA).
Correct Answer
C. People must have unsatisfied wants and needs as well as a willingness and ability to buy.Explanation
For a market to exist, it is necessary that people have unsatisfied wants and needs, and also possess the willingness and ability to buy. This means that there must be a demand for the good or service in question. Without this demand, there would be no market as there would be no potential buyers. The presence of wholesalers, retailers, a dominant firm, or laboratory testing and approval by the FDA are not essential factors for the existence of a market.Rate this question:
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- 49.
Managers in progressive organizations tend to emphasize teamwork and cooperation rather than discipline and giving orders.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
In progressive organizations, managers prioritize teamwork and cooperation over discipline and giving orders. This approach promotes a collaborative work environment where employees are encouraged to work together, share ideas, and contribute to the overall success of the organization. By emphasizing teamwork, managers can foster a culture of trust, open communication, and mutual support, which ultimately leads to increased productivity and employee satisfaction.Rate this question:
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- 50.
The four key management functions are planning, organizing, leading, and controlling.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
The statement is true because planning involves setting goals and deciding on the best course of action to achieve them, organizing involves arranging resources and tasks to achieve the goals, leading involves guiding and motivating employees to work towards the goals, and controlling involves monitoring progress and making adjustments to ensure that goals are being met. These four functions are essential for effective management.Rate this question:
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Current Version
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Mar 21, 2023Quiz Edited by
ProProfs Editorial Team -
Dec 09, 2010Quiz Created by
Acasto5
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