Business Environment
Exam Answer Key
Course Introduction
Business Environment explores the complex and dynamic external forces that impact organizations, including economic, legal, political, social, technological, and global factors. The course examines how businesses interact with these environments to make strategic decisions, adapt to change, and achieve sustainable growth. Students will analyze current events, case studies, and theoretical frameworks to understand market structures, regulatory systems, corporate social responsibility, and the challenges of operating in diverse national and international contexts. The course equips learners with analytical skills to assess opportunities and threats in the business landscape, preparing them for effective decision-making in various professional settings.
Recommended Textbook
The Future of Business 4th Edition by Norm Althouse
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Chapter 1: Politics Governments Roles
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100 Flashcards
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Sample Questions
Q1) To stimulate competition and protect both consumers and workers,what does the federal government do?
A) It places heavy taxes on companies in monopolistic competition.
B) It creates business systems to meet the needs of all consumers.
C) It creates regulations to intervene in the free market.
D) It places limits on international trade in order to stimulate domestic production.
Answer: C
Q2) George is a maple syrup farmer in Northern Ontario.As there are a lot of other maple syrup farmers in Canada the market is saturated.George wants to sell his maple syrup internationally but does not know how to go about it.He hears that the government will assist Canadian companies looking to export.Which level of government will assist George?
A) federal
B) provincial
C) municipal
D) city
Answer: A
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Page 3
Chapter 2: Economics Evolving Systems
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130 Flashcards
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Sample Questions
Q1) Which of the following terms refers to a market in which there are a large number of companies that differentiate their products?
A) an oligopoly
B) oligopolistic competition
C) perfect competition
D) monopolistic competition
Answer: D
Q2) Which of the following refers to the Bank of Canada's programs for controlling the amount of money in circulation?
A) microeconomics
B) macroeconomics
C) monetary policy
D) fiscal policy
Answer: C
Q3) List the four types of unemployment.
Answer: frictional,structural,cyclical,and seasonal
Q4) Which market structure is an ideal and does not really exist?
Answer: perfect or pure competition
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Page 4
Chapter 3: Social Society, Corporate Responsibility, and Making Ethical Decisions
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116 Verified Questions
116 Flashcards
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Sample Questions
Q1) A retailer allows its employees to handle customer complaints without having to ask for permission or directions from management.Which of the following activities would this policy encourage?
A) employees feeling empowered to help customers
B) employees ignoring the rights of its customers
C) employees actively helping customers
D) employees avoiding customers
Answer: A
Q2) Corporate philanthropy excludes any noncash donations.
A)True
B)False
Answer: False
Q3) There is a strong business case for practising business integrity and behaving in a socially responsible manner.
A)True
B)False
Answer: True
Q4) Why are "component lifestyles" important for marketers to understand?
Answer: They increase the complexity of consumer's buying habits.
Page 5
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Chapter 4: Technology Managing Information for Business
Success
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102 Flashcards
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Sample Questions
Q1) Many companies have hired a chief information officer (CIO)to be responsible for managing all information resources.
A)True
B)False
Q2) "Grid computing" is another term used for telecommuting.
A)True
B)False
Q3) Which of the following approaches to protecting data and computer systems can prevent problems from occurring?
A) a consultative approach
B) a reactive approach
C) a proactive approach
D) an accommodative approach
Q4) Which of the following best describes virtual private networks?
A) They require a significant investment in Internet infrastructure in order to operate efficiently.
B) They are least useful to people who regularly work outside the office.
C) They connect two or more private networks using a public network.
D) They dramatically increase a company's communications cost.
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Chapter 5: International The Global Marketplace
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Sample Questions
Q1) Which of the following organizations were formed with the original purpose of helping build infrastructure in developing countries and helping relieve the debt burden of these countries?
A) the International Funding Bank
B) the Central Bank
C) the World Bank
D) the Bank of Canada
Q2) An argument in favour of protective tariffs is the "infant-industry argument." Which of the following statements would best reflect that argument?
A) Infant industries should be protected from established foreign competition.
B) Infant industries should be exempt from antitrust laws.
C) Any industry dealing with products for infants should be protected.
D) Infant industries need government loans.
Q3) Which of the following terms means that prices of currencies vary based upon demand and supply of that currency?
A) variable trade
B) the international trade rate
C) the floating exchange rate
D) variable costs
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Chapter 6: Entrepreneurship and Small Business
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Sample Questions
Q1) Which of the following provides the start-up financing for the majority of new small businesses?
A) the local bank
B) venture capitalists
C) the business owner
D) the Business Development Bank of Canada
Q2) Which of the following is financing obtained from investment companies that specialize in financing small,high-growth companies and receive an ownership interest and a voice in management in return for their money?
A) equity financing
B) entrepreneurial capital
C) venture capital
D) debt financing
Q3) Which of the following two forms of business financing describe borrowed funds and ownership funds,respectively?
A) debt; equity
B) credit; leverage
C) equity; debt
D) equity; leverage
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Page 8
Chapter 7: Analyzing the Business
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108 Flashcards
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Sample Questions
Q1) Which of the following summarizes a company's financial position at a specific point in time (e.g.,a specific quarter or year)?
A) statement of cash flows
B) income statement
C) balance sheet
D) investment income statement
Q2) A large sector of the Canadian economic activity is in the commodity industries; often having a positive impact on the environment by extracting,refining,and transporting these commodities.
A)True
B)False
Q3) The industry life cycle model analyzes the effects of an industry's evolution on competitive forces.
A)True
B)False
Q4) One way to measure if a business is meeting its customers' needs is through "third-level communications."
A)True
B)False
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Chapter 8: Forms of Business Ownership
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Sample Questions
Q1) Which of the following is a disadvantage associated with a partnership?
A) unlimited liability
B) flexibility
C) diversity of management
D) possibility of more available credit
Q2) Mergers create an advantage when competing in the global marketplace.
A)True
B)False
Q3) If the sole proprietorship acquires a legal business name,the owner then has limited liability.
A)True
B)False
Q4) Sanford Lee is planning to open a pizza parlour.He has a secret tomato sauce recipe that he does not want to divulge to anyone.Lee also wants to have sole responsibility for all business decisions.What sort of organization should Lee form?
A) a limited cooperative
B) a joint venture
C) a sole proprietorship
D) a limited partnership
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Chapter 9: Management and Leadership in Todays Organizations
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Sample Questions
Q1) Lee Iacocca was the dominant figure at Chrysler for many years because of his personal qualities and his charisma.He had a unique leadership style.Iacocca's influence reflected which type of power?
A) coordinating
B) legitimate
C) controlled
D) referent
Q2) The ability to work with people and be sensitive to workers' needs are examples of human relations skills.
A)True
B)False
Q3) Which of the following skills refer to the manager's ability to operate in diverse cultural environments?
A) global management
B) world centred
C) international
D) human relations
Q4) Managerial skills fall into four basic categories.What are they?
Q5) What two types of leadership style use empowerment?
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Chapter 10: Designing Organizational Structures
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Sample Questions
Q1) A research employee at the European Metabolic Diseases Group has a boss at the company's European Research department and a boss at the company's European Metabolic Diseases product group.This violates which of the following principles?
A) unity of command
B) functionalization
C) unity of supervision
D) unity of structure
Q2) Which of the following is a network of independent companies linked by information technology to share skills,costs,and access to one another's markets?
A) an opportunistic corporation
B) an autonomous corporation
C) a hierarchical corporation
D) a virtual corporation
Q3) A tall organization structure has few managerial levels and a long chain of command.
A)True
B)False
Q4) What kind of power gives a supervisor the authority to make decisions?
Q5) Briefly define accountability.
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Chapter 11: Motivating Employees
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Sample Questions
Q1) Anila Sudavarian works as a receptionist for a medical clinic from 8 a.m.until 12 noon 5 days a week.At noon,he is replaced by Louise Cho who works at the same job from noon until 4 p.m.Which of the following scheduling options is being used by Sudavarian and Cho?
A) job partnering
B) flextime
C) compressed work week
D) job sharing
Q2) Which of the following theories suggest that workers respond to attention from superiors,and they like their opinions to be valued?
A) the Hawthorne effect
B) the equity theory
C) Theory X
D) scientific management
Q3) What is another name for employee empowerment?
Q4) What are gain-sharing plans?
Q5) What are managers doing when they vertically expand an employee's job?
Q6) Motivation is basically a need-satisfying process.
A)True
B)False
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Chapter 12: Managing Human Resources and Labour Relations
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Sample Questions
Q1) What is the most powerful tool that the union has in its strategy?
Q2) Lower-level workers,such as those who unload inventory from trucks,are usually paid in which of the following ways?
A) salaries
B) commissions
C) wages
D) piece rate
Q3) What is a contingent worker?
Q4) The internal labour market is made up of all employees in an industry.
A)True
B)False
Q5) Mr.Smythe uses communication and persuasion as his tools to help unions and employers negotiate.Smythe can suggest compromises but cannot issue a binding decision.He is performing which of the following roles?
A) arbitrator
B) mediator
C) conciliator
D) certifier
Q6) What is the first step in human resource planning?
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Chapter 13: Marketing The Customer Focus
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Sample Questions
Q1) Aldi is a no-frills grocery chain.By controlling expenses,Aldi customers can expect to save 30-50 percent compared to Safeway customers.The chain targets bargain hunters who are willing to rent a cart and bag their own groceries.Aldi's competitive advantage is based on which of the following?
A) promotion
B) its competition
C) low costs
D) stakeholders
Q2) Selling retirement plans to people over the age of 50 is an example of demographic segmentation.
A)True
B)False
Q3) Often marketers who issue coupons will do which of the following to see if consumers will respond more favourably to half-off coupons or two-for-the-price-of-one coupons?
A) survey research
B) experimental research
C) observation research
D) secondary research
Q4) What kind of segmentation is the publisher of Seventeen magazine using?
Page 15
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Chapter 14: Creating Marketing Strategies
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Sample Questions
Q1) What are airlines trying to achieve when they use frequent flyer programs,which give customers points that can be redeemed for free travel,rental cars,and other merchandise?
A) to get consumers to try their product
B) to create product awareness
C) to provide information
D) to increase the amount and frequency of use
Q2) Which of the following is a capital product for a multinational organization?
A) a corporate jet
B) fax machine paper
C) a mobile phone
D) a file folder
Q3) Agents are sales representatives for manufacturers or wholesalers and usually are hired on a commission basis.
A)True
B)False
Q4) List two reasons that a company might use penetration pricing.
Q5) List the four major categories of consumer products.
Q6) Give an example of bundling.
Q7) What are the two classifications of business products?
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Chapter 15: Achieving World-Class Operations Management
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Sample Questions
Q1) Which of the following is an important scheduling tool for large projects? It breaks the projects into a sequence of events and smaller tasks.
A) the crucial task system
B) the sequence of elements
C) project sequencing
D) the critical path method
Q2) List two commonly used techniques for streamlining a business's production.
Q3) There is a standard approach to butchering a steer; however,after standardized preparation,the meat is tailored to meet individual needs and desires.This is an example of which type of production?
A) niche manufacturing
B) just-in-time production
C) individualized production
D) mass customization
Q4) A job shop uses an intermittent production process.
A)True
B)False
Q5) How does materials requirement planning differ from enterprise resource planning?
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Chapter 16: Accounting for Financial Success
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Sample Questions
Q1) Another term for "net worth" is "working capital."
A)True
B)False
Q2) A current asset is one that can or will be converted into cash within one year.
A)True
B)False
Q3) Which of the following classification of ratios reflects the speed with which resources are converted to cash or sales?
A) leverage
B) equity
C) activity
D) profitability
Q4) What is the accountant's term used to describe the $15,000 Petra Jabon borrowed to turn her carport into a closed garage?
Q5) The five-step process that takes a transaction from being mere raw financial data to being summarized in the financial statements is called the accounting cycle.
A)True
B)False
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Chapter 17: Understanding Money and the Canadian Financial System
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Sample Questions
Q1) Another term for a chequing account is a time deposit.
A)True
B)False
Q2) To stimulate the economy,the Bank of Canada can do which of the following?
A) lower the reserve requirement
B) raise the prime rate
C) sell government bonds on the open market
D) buy shares listed on the Toronto Stock Exchange
Q3) What are junk bonds?
Q4) Which of the following financial institutions is a not-for-profit institution?
A) a savings bank
B) a credit union
C) a commercial bank
D) a savings and loan association
Q5) Which of the following are agreements to buy or sell specified quantities of commodities or financial instruments at an agreed price at a future date?
A) futures contracts
B) mutual debenture contracts
C) options contracts
D) on-time contracts
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Chapter 18: Finance Maximizing the Value
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Sample Questions
Q1) The three main types of unsecured short-term loans are which of the following?
A) trade credit, bank loans, and commercial paper
B) treasury bills, certificates of deposit, and accounts payable
C) trade credit, accounts payable, and bank loans
D) accounts payable, notes payable, and loans payable
Q2) Which of the following is a long-term loan using real estate or other assets as collateral?
A) an unsecured loan
B) a discount loan
C) a mortgage loan
D) a line of credit loan
Q3) C.W.Beauregard is an Atlantic salmon farmer.He produces and sells salmon to satisfy the growing demand for fish.He has arranged a business loan with terms that guarantee that he can borrow up to $12,000 whenever he needs it within the next year.He must pay interest only on the unpaid loan balance.Beauregard has arranged which type of credit?
A) a credit-line loan
B) a line of credit
C) a single-payment note
D) a collateralized loan
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