Business Foundations
Pre-Test Questions
Course Introduction
Business Foundations is an introductory course designed to provide students with a comprehensive overview of essential business concepts and practices. The course covers key topics such as management, marketing, finance, accounting, economics, and the legal and ethical environment of business. Students will explore how businesses operate, make decisions, and adapt to changing environments. Through case studies, practical exercises, and collaborative projects, learners will develop a foundational understanding of how organizations create value, manage resources, and pursue strategic goals, preparing them for further study or entry-level positions in the business world.
Recommended Textbook
Business Essentials 10th Edition by Ronald
J. Ebert
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17 Chapters
2016 Verified Questions
2016 Flashcards
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Page 2
Chapter 1: The USBusiness Environment
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125 Verified Questions
125 Flashcards
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Sample Questions
Q1) Economic systems differ in how factors of production are used.
A)True
B)False
Answer: True
Q2) A nation's economic system is its system for allocating its resources among its citizens,both individuals and organizations.Explain how the three economic systems allocate their resources.
Answer: A nation's resources,often referred to as the factors of production,include labor,capital,entrepreneurs,physical resources,and information resources.An economic system is defined by how it manages and allocates these factors of production.In a planned economy,for example,the factors of production are government owned and controlled.In a market economy,such as that of the United States,individual producers and consumers control production and allocation by creating combinations of supply and demand.In a mixed market economy,which features characteristics of both a planned and a market economy,there is some government control of some factors of production,often through the nation's major industries,such as transportation,communication,and information,alongside some private ownership.
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Page 3
Chapter 2: Understanding Business Ethics and Social Responsibility
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131 Verified Questions
131 Flashcards
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Sample Questions
Q1) Dara's Dress Shop was honored last year for its strong commitment to corporate social responsibility.Which of the following would MOST likely decrease the shop's chances of being recognized again this year?
A) The shop has laid off two employees during the past six months.
B) Fewer clearance sales have been offered to the public this year.
C) An experienced ethics professional has been added to the Board of Directors.
D) Many of the dresses are made from fabrics spun by unprotected child laborers.
E) The shop has reduced its line of designer merchandise.
Answer: D
Q2) Which statement about codes of ethics is FALSE?
A) Fewer and fewer companies are adopting codes of ethics.
B) Codes of ethics are determined by company managers.
C) Some ethical responses can be learned through experience.
D) Social responsibility involves providing quality products and pricing products fairly.
E) Core principles and values should remain a constant characteristic of a company.
Answer: A
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Chapter 3: Entrepreneurship, New Ventures, and Business Ownership
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145 Verified Questions
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Sample Questions
Q1) What resources does a sole proprietorship primarily depend on?
A) the corporation
B) foreign investors
C) capital markets
D) those of the owner
E) a committed clientele
Answer: D
Q2) A limited liability corporation is a hybrid of a publicly held corporation and a partnership.
A)True
B)False
Answer: True
Q3) Discuss the advantages and disadvantages of corporations.
Answer: The advantages include limited liability,continuity,and the ability to raise money.Among the disadvantages are transferring ownership such as through a tender offer,higher start-up costs,and double taxation.
Explanation:The biggest advantage of incorporation is limited liability:Investor liability is limited to personal investment (through stock ownership)in the corporation. The biggest disadvantage of incorporation is double taxation.
Page 5
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Chapter 4: Understanding the Global Context of Business
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120 Flashcards
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Sample Questions
Q1) If you have given another company in another country the right to produce your company's product,you are engaging in a licensing arrangement.
A)True
B)False
Q2) One of Derrido's sales executives suggests that Derrido's particular type of business enables a contractual relationship to be an especially suitable way for the company to market its products internationally.Which of the following,if true,would strengthen this position?
A) Contractual relationships allow an originating firm to make the most use of local talent.
B) Contractual relationships cannot capture unpredictable future contingencies.
C) Contractual relationships are often cross-culturally contentious.
D) Derrido would not be undertaking large-scale production or shipping operations.
E) Derrido is a large company with ample staff and resources at its disposal.
Q3) A comparative advantage exists when a country can produce something more cheaply and/or of higher quality than any other country.
A)True
B)False
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Chapter 5: Managing the Business
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Sample Questions
Q1) Identify the four leading causes of wasted time in the workplace as outlined in the text.
Q2) Which of the following BEST describes business strategy?
A) a strategy for determining the firm's overall attitude toward growth and the way it will manage its businesses or product lines
B) a strategy at the business-unit or product-line level that focuses on improving a firm's competitive position
C) a strategy by which managers in specific areas decide how best to achieve corporate goals through productivity
D) a strategy that assists first-line managers in making day-to-day decisions about motivating employees
E) a strategy that integrates an organization's marketing goals into a cohesive whole by focusing on the ideal product mix to achieve maximum profit potential
Q3) The first step in the control process is to compare actual performance to standards. A)True
B)False
Q4) Why is it important for Donna to be setting goals?
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Chapter 6: Organizing the Business
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Sample Questions
Q1) After an organizational structure has been created,it is permanent and cannot be changed.
A)True
B)False
Q2) Decentralization works best in a complex,rapidly changing environment.
A)True
B)False
Q3) Jack Welch,former CEO of General Electric,stated,"If you don't let managers make their own decisions,you're never going to be anything more than a one-person business."
What style of management is Welch proposing?
A) authentic management
B) linear management
C) centralized management
D) group management
E) decentralized management
Q4) Describe a learning organization.
Q5) Job specialization is the process of eliminating unnecessary or undesirable jobs.
A)True
B)False
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Chapter 7: Operations Management and Quality for Producing Goods and Services
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Sample Questions
Q1) What is a supply chain? How can supply chain management create competitive advantage?
Q2) Staff schedules identify which products will be produced and when.
A)True
B)False
Q3) An assembly line is an example of a custom-products layout.
A)True
B)False
Q4) Consistency refers to which of the following?
A) the principle that quality belongs to each person who creates it while performing a job
B) the sameness of product quality from unit to unit
C) the sum of all activities involved in getting high-quality products into the marketplace
D) the process by which a company analyzes a competitor's products to identify desirable improvements
E) providing value by making products available where customers want them
Q5) Outsourcing has led to increasingly global supply chains.Describe three ways that a more global supply chain might be risky for a company that outsources.
9
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Chapter 8: Employee Behavior and Motivation
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Sample Questions
Q1) What are some potential consequences of employees being dissatisfied?
Q2) According to research,emotional intelligence cannot be developed or learned. A)True
B)False
Q3) You need to assign a task to one of your employees.The task involves a high level of detail.To whom should you assign the task?
A) Amy, who exhibits high agreeableness and low conscientiousness
B) David, who exhibits more negative emotionality and low agreeableness
C) Sarah, who exhibits high openness and low negative emotionality
D) Winston, who exhibits high conscientiousness and low extraversion
E) Liza, who exhibits high creativity and low negative emotionality
Q4) What is the Hawthorne effect?
A) the belief that employees are motivated by money alone
B) the conclusion that workers are more productive if management pays attention to them
C) the determination that the level of lighting in a workplace has no effect on productivity
D) the theory that workers are more productive if their jobs are analyzed closely
E) the unspoken agreement between the employee and the employer
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Chapter 9: Leadership and Decision Making
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Sample Questions
Q1) What area was the earliest research on leadership MOST concerned with?
A) leadership behaviors
B) leadership traits
C) leadership situations
D) leadership integrity
E) leadership roles
Q2) Which of the following BEST describes task-focused leader behavior?
A) concentration on how tasks should be performed
B) concentration on which tasks should be performed
C) concentration on why tasks should be performed
D) concentration on who should perform which tasks
E) concentration on when tasks should be performed
Q3) Managers at Adidas had a hunch that their sponsorship deal with the Yankees would be a good one.Their feelings were based on what concept?
A) escalation of commitment
B) risk propensity
C) intuition
D) perception
E) rational decision making
Q4) Describe the steps involved in the rational decision-making process.
Page 11
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Chapter 10: Human Resource Management and Labor Relations
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Sample Questions
Q1) Which of the following describes the skills,abilities,and qualifications required for a job?
A) staffing survey
B) advertising budget
C) job specification
D) employee analysis
E) replacement chart
Q2) Plants Galore is a business selling a range of indoor plants.In the past there has been a problem with plants being stolen by staff.Which of the following represents the biggest limitation in reference checks as a reliable way of assessing the value of prospective employees?
A) Reference checks are illegal in a number of states.
B) Reference checks obtained from previous employers are out of date.
C) Some previous employers may no longer be in business.
D) Some reference checks can be time consuming.
E) Reference checks tend to only tap positive recommendations.
Q3) In setting wage and salary levels,a firm may start by looking at competitors' levels.
A)True
B)False
Page 12
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Chapter 11: Marketing Processes and Consumer Behavior
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Sample Questions
Q1) Geographic variables describe populations by identifying traits,such as age,income,gender,ethnic background,marital status,race,religion,and social class.
A)True
B)False
Q2) In small business,why are some new products and firms doomed at the start?
Q3) List five possible sources of value that consumers receive from Panther Shoes.
Q4) What is the term for a detailed strategy for focusing marketing efforts on consumers' needs and wants?
A) marketing mix
B) marketing manager
C) product differentiation
D) product development
E) marketing plan
Q5) Product differentiation is selecting the best price at which to sell a product.
A)True
B)False
Q6) Explain each step in the consumer buying process.
Q7) Describe the elements of the marketing mix.What is their collective role?
Q8) Explain the elements that comprise the marketing environment.
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Chapter 12: Developing and Pricing Products
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Sample Questions
Q1) Describe the stages in the product life cycle.
Q2) Using the odd-even psychological pricing strategy,a restaurant would price an entree at $10.00 rather than $9.95.
A)True
B)False
Q3) Which of the following pricing strategies BEST describes price lining?
A) setting an initial low price to establish a new product in the market
B) setting an initial high price to cover new product costs and generate a profit
C) setting individually negotiated prices for certain categories of products
D) setting a limited number of prices for certain categories of products
E) setting individually negotiated prices for all categories of products
Q4) Why might retailer Best Buy price a television at $299.99 rather than $300.00?
Q5) What are three functions of packaging?
Q6) A doctor's office buys a multifunction printer.This purchase is an example of a capital item.
A)True
B)False
Q7) Why is new product development expensive?
Q8) Describe the three types of brand names and give an example of each.
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Chapter 13: Distributing and Promoting Products
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Sample Questions
Q1) Which of the following bargain retailers generate large sales volume by offering a wide variety of new products at substantial price reductions?
A) discount houses
B) catalog showrooms
C) second-hand stores
D) factory outlets
E) direct-response bargain marketing
Q2) Which of the following,if true,would MOST seriously weaken the argument for using the Internet as the medium of advertising?
A) Countries with restrictive regimes are yet to free this medium from controls over political content.
B) Consumers are extremely frustrated with annoying pop-up ads that affect the quality of browsing.
C) Studies show that customers tend not to notice Internet ads that are not intrusive in nature.
D) The interactive capabilities of Internet ads are rarely being used in a creative manner. E) People who are online are also known to engage in media multi-tasking.
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15
Chapter 14: Information Technology (IT)for Business
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Sample Questions
Q1) What system allows outsiders limited access to a firm's internal information systems?
A) intranets
B) firewalls
C) extranets
D) directories
E) satellites
Q2) What type of users would download spyware?
A) users seeking to prevent viruses from attacking
B) users who are unaware that their computer activities will be monitored
C) users who wish to prevent spam from entering their computer
D) users who want easy access to their coworkers' files
E) users who are keen to share documents
Q3) What advantage does a communication system using VSAT satellite have?
A) speed
B) low cost
C) privacy
D) groupware
E) spyware
Q4) Explain the principle of mass-customization.
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Chapter 15: The Role of Accountants and Accounting Information
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Sample Questions
Q1) A large company specializing in bread baking has made its annual balance sheet available to its investors.Profits were slightly lower than expected this year.Which of the following items does NOT need to be included in this statement in order to fulfill the principle of full disclosure?
A) The current rise of local micro-bakeries has not affected and probably will not affect the revenue of the company.
B) The company is contemplating a merger with another major baking company.
C) Much of the loss of profits can be explained by the sudden rise in the price of wheat during the past year.
D) A baking start-up company founded by some former executives of the company looks like it will be a major competitor in the upcoming years.
E) The company and the union for its workers were able to halt a labor strike by negotiating increased health benefits for its workers, causing a slight increase in operating costs.
Q2) If a company's assets exceed its liabilities,owners' equity is negative.
A)True
B)False
Q3) Give three examples of management advisory services.
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Chapter 16: Understanding Money and the Role of Banking
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Sample Questions
Q1) What happens to demand and price during times of inflation?
Q2) Gizmo's marketing director argues that because the global economy is interconnected,if Gizmo continues to be profitable in the United States,it should be able to invest that money to do well internationally.Which of the following,if true,would MOST weaken her argument?
A) Gizmo's existing products can be used in other countries.
B) The currency exchange rate between countries can fluctuate.
C) Current Gizmo employees will need some cultural training to do business effectively in other countries.
D) Investors will not be willing to put money into Gizmo's foreign business expansion without a business plan.
E) Marketing strategies that are successful in the United States are not always successful overseas.
Q3) What is Check 21?
Q4) In mutual savings banks,all depositors are considered owners of the bank.
A)True
B)False
Q5) Which of the three functions of money does a time deposit account MOST exemplify?
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Chapter 17: Managing Business Finances
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Sample Questions
Q1) Which of the following assumptions does Groh make?
A) Inflation can outpace any interest rate.
B) Given enough time, any stock will eventually go up in value.
C) The riskier the investment, the more value it will have over a long period of time.
D) The more stocks you invest in, the higher their value will be.
E) The stock market overall will experience net growth over time.
Q2) Aggressive growth funds are designed for investors who can accept the risk of loss inherent in common stock investing with severe price fluctuations,but also the potential for superior returns over time.
A)True
B)False
Q3) Explain the Rule of 72.
Q4) When are corporate bonds attractive to a firm?
Q5) Which stock exchange has the highest volume of shares traded?
A) American Stock Exchange
B) New York Stock Exchange
C) NASDAQ
D) Philadelphia Stock Exchange
E) SEC
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