Business Foundations
Test Questions
Course Introduction
Business Foundations provides an essential overview of core business principles, laying the groundwork for further study in the field. This course introduces students to fundamental concepts such as management, marketing, finance, accounting, operations, and entrepreneurship. Emphasis is placed on understanding how different functions interrelate within an organization and the impact of external forces such as economics, ethics, and globalization on business decision-making. Through case studies, real-world examples, and interactive activities, students develop a comprehensive understanding of the modern business environment and essential skills for success in a variety of business careers.
Recommended Textbook
Contemporary Business 16th Edition by Louis
E. Boone
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17 Chapters
2631 Verified Questions
2631 Flashcards
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Page 2
Chapter 1: The Changing Face of Business
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156 Verified Questions
156 Flashcards
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Sample Questions
Q1) Which of the following is given the LEAST importance by managers of today?
A) The ability to work by strict rules
B) The ability to envision the firm's future
C) The ability to think critically
D) The ability to be creative
Answer: A
Q2) Inventors such as Robert McCormick and Eli Whitney were part of the _____.
A) marketing era
B) colonial era
C) marketing era.
D) age of industrial entrepreneurs
Answer: D
Q3) The current philosophy among managers today is best described as transaction management.
A)True
B)False
Answer: False
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Page 3
Chapter 2: Business Ethics and Social Responsibility
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183 Verified Questions
183 Flashcards
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Sample Questions
Q1) According to _____ standards, when a drug company purchases a television ad, the company is required to describe potential side effects of the drug, or at least provide a phone number or Web site address for additional information.
A) Occupational Safety and Health Administration (OSHA)
B) Food and Drug Administration (FDA)
C) Consumer Compliance
D) Securities and Exchange Commission (SEC)
Answer: B
Q2) "Maintaining an atmosphere of cultural integrity" is an example of something that might be found in a company's code of conduct.
A)True
B)False
Answer: True
Q3) An individual employee acting ethically will have little influence on his or her coworkers.
A)True
B)False
Answer: False
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4
Chapter 3: Economic Challenges Facing Contemporary Business
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179 Verified Questions
179 Flashcards
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Sample Questions
Q1) In _____, a local, state, or federal government grants exclusive rights in a certain market to a single firm.
A) pure competition
B) oligopolies
C) regulated monopolies
D) monopolistic competition
Answer: C
Q2) Which of the following is true of monetary policy?
A) It uses taxation and spending to control economic activities.
B) It is dictated by international organizations like the United Nations
C) It is a mechanism to control the flow of foreign currency into a nation by reducing its exports.
D) It uses variations in interest rate and money supply to influence a nation's economy.
Answer: D
Q3) The equilibrium price occurs at the point of intersection between the supply and demand curves.
A)True
B)False
Answer: True
Page 5
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Chapter 4: Competing in World Markets
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171 Verified Questions
171 Flashcards
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Sample Questions
Q1) The objective of quotas is to _____.
A) prevent dumping
B) raise revenue for the government
C) ban the importation of certain goods
D) protect domestic industries
Q2) The U.S. imports more services than it exports.
A)True
B)False
Q3) The United States has a trade surplus in which of the following items?
A) Oil
B) Textiles
C) technology products
D) services
Q4) Define offset agreement and describe how it might be beneficial to a small firm.
Q5) Less-developed countries represent a lucrative market for U.S. firms because of their huge population.
A)True
B)False
Q6) Explain how population size or a country's status of developed versus developing do not always indicate economic prosperity.
Page 6
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Chapter 5: Forms of Business Ownership and Organization
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164 Verified Questions
164 Flashcards
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Sample Questions
Q1) Although _____ are the most common type of business ownership, the greatest revenues come from _____.
A) sole proprietorships; partnerships
B) sole proprietorships; corporations
C) corporations; partnerships
D) partnerships; corporations
Q2) Franchising offers all of the following advantages EXCEPT _____.
A) a recognizable company name
B) prior performance record
C) training
D) guaranteed level of profitability
Q3) Describe the complexity of franchise agreements.
Q4) Which of the following statements is true regarding employee-owned corporations?
A) The number of employee-owned corporations is declining in the United States.
B) Employee-owned corporations may not publicly trade their stock.
C) Employees buy shares of stock in the company that employs them.
D) Stock prices in employee-owned corporations typically decrease.
Q5) Franchisors generally find it more challenging to build a large customer base.
A)True
B)False
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Chapter 6: Starting Your Own Business: the Entrepreneurship Alternative
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111 Verified Questions
111 Flashcards
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Sample Questions
Q1) As a rule, entrepreneurs believe in their ability to succeed.
A)True
B)False
Q2) Victoria is an employee at Pegasys Inc., a consulting firm. She uses the resources of the firm to expand and diversify into related fields. Victoria is most likely to be classified as a(n) _____.
A) manager
B) entrepreneur
C) stock broker
D) venture capitalist
Q3) Stefan wants to start a new business, but his bank will not lend him the money he needs. Stefan saw an advertisement sponsored by a business organization that provides financing for early-stage, high-potential growth companies. The organization sponsoring the advertisement would be considered a _____.
A) franchisor
B) franchisee
C) mortgage lender
D) venture capitalist
Q4) Discuss lifestyle entrepreneurs.
Page 8
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Chapter 7: Management, Leadership, and the Internal Organization
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194 Verified Questions
194 Flashcards
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Sample Questions
Q1) An auto parts store establishes a policy requiring that customer service representatives respond to e-mails within three business days. This policy is a result of the company's operational planning.
A)True
B)False
Q2) Tactical planning is primarily the responsibility of _____.
A) middle managers
B) supervisory managers
C) first-line managers
D) top management executives
Q3) Which statement is true of the implementation phase of strategic planning process?
A) Often, it is the middle managers or supervisors who actually implement a strategy.
B) It is the second phase of the strategic planning process.
C) It involves securing feedback about performance.
D) Often, a firm attempts to define the major opportunities and threats it is likely to face in this phase.
Q4) Explain the role of vision and ethical standards in business success.
Q5) Describe each of the management functions.
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Chapter 8: Human Resource Management: From
Recruitment to Labor Relations
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149 Verified Questions
149 Flashcards
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Sample Questions
Q1) Saleem, an electrician for FCG Electricals, is paid $40 for each hour he works during the day. After 5 p.m. and on weekends, he is paid the overtime rate of one and one-half times the regular hourly rate. In this scenario, Saleem is paid a _____.
A) wage
B) bonus
C) commission
D) salary
Q2) A strike seeks to disrupt business as usual.
A)True
B)False
Q3) A union's bargaining process must end upon the rejection of a contract.
A)True
B)False
Q4) Emily receives a bonus of $1,500 at the end of the year based on the cost savings. Which form of incentive compensation is indicated in this case?
A) Profit sharing
B) Pay for knowledge
C) Lump-sum bonus
D) Gain-sharing
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Chapter 9: Top Performance Through Empowerment,
Teamwork, and Communication
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146 Verified Questions
146 Flashcards
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Sample Questions
Q1) According to a research on team effectiveness, to achieve best results the ideal team size is usually _____ members.
A) fewer than five
B) between five and ten C) between ten and twenty
D) more than twenty
Q2) Zoltan announced to his accounting team that the company's financial reports should be completed "by next week." Subsequently, members of his team had completely different ideas about when the reports were due. At which stage of communication are the team members?
A) providing feedback
B) message encoding
C) understanding the context
D) message decoding
Q3) Customer orders are considered to be an internal communication.
A)True
B)False
Q4) Explain the importance of the storming stage of team development.
Q5) What are some of the challenges associated with e-mail?
Q6) Define cross-functional teams and explain the emphasis on communication. Page 11
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Chapter 10: Production and Operations Management
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Sample Questions
Q1) Yusted's company uses a computer to control its production process. The computer transmits signals to machines for performing the appropriate steps in the correct order. This is an example of _____.
A) computer-aided design
B) computer-aided manufacturing
C) flexible manufacturing
D) computer-integrated manufacturing
Q2) How can a firm best protect itself against an interruption in the supply of parts?
A) Select suppliers through a competitive bidding process.
B) Use suppliers from the city where the firm is located.
C) Maintain more than one supply source.
D) Transport the parts in its own transportation vehicles.
D
Q3) All of the following are expenses involved in storing inventory EXCEPT _____.
A) maintenance
B) acquisition
C) insurance
D) warehouse rent
Q4) Provide two examples of uses for robots.
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Chapter 11: Customer-Driven Marketing
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156 Verified Questions
156 Flashcards
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Sample Questions
Q1) Approximately how much more does it cost to attract one new customer than to keep an existing one?
A) Five times as much
B) Three times as much
C) Twice as much
D) About the same
Q2) Esperanza is reviewing data that shows sales of her company's products during specific hours of each day. What kind of data is Esperanza reviewing?
A) Survey data
B) Secondary data
C) External data
D) Internal data
Q3) Mass customization attempts to blend unique features into standardized goods and services.
A)True
B)False
Q4) Marketing is a process that begins with discovering unmet customer need.
A)True
B)False
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Chapter 12: Product and Distribution Strategies
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184 Flashcards
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Sample
Questions
Q1) Cooper Inc. has been involved in intensive price competition with one of its products. Profits are low and market researchers are concerned that losses will soon occur due to a reduced market for the item. This product has reached the _____ stage of the product life cycle.
A) growth
B) introductory
C) maturity
D) decline
Q2) One advantage of Internet retailing is that adding a large product mix to a Web site is less costly than making room on a store's shelves.
A)True
B)False
Q3) A(n) _____ is the major supplier designated by a business customer to assume responsibility for dealing with all the other vendors for a project and presenting the entire package to the business buyer.
A) brand manager
B) analyst
C) category advisor
D) associate
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Page 15
Chapter 13: Promotion and Pricing Strategies
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157 Verified Questions
157 Flashcards
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Sample Questions
Q1) Blue, a Jazz club, is conducting a breakeven analysis to determine how many tickets it must sell at $20 each to break even on the Jazz Fest, a program conducted by it. Fixed costs are $4,000, and the variable cost per person is $10. To break even, Blue must sell _____ tickets.
A) 800
B) 500
C) 400
D) 80
Q2) Andrew is allowed to purchase a reasonably priced notebook computer for graduation. He sees one at Excel Electronics for $999.99 and calls his parents to assure them the computer costs "less than a thousand." Both Andrew and Excel Electronics are using _____ to downplay the price of the computer.
A) cost-based pricing
B) personal selling
C) price fixing
D) odd pricing
Q3) Explain how marketers conduct breakeven analyses.
Q4) Describe the circumstances in which a firm is more likely to emphasize personal selling rather than advertising.
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Chapter 14: Using Technology to Manage Information
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117 Flashcards
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Sample Questions
Q1) A program that performs specific tasks that the user wants to carry out is called
A) financial software
B) the operating system
C) a management information system
D) application software
Q2) Which of the following is a storage device?
A) thumb drive
B) modem
C) CRT monitor
D) scanner
Q3) On Zaxen.com, homebuyers enter information regarding their preferred home location, price, and features. Using an ________, the website automatically displays real estate properties that match the homebuyer's criteria.
A) executive information system
B) encryption
C) application service provider
D) expert system
Q4) Define databases and describe how they are obtained and their uses.
Q5) Describe two tips for communication etiquette for using wireless devices.
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Chapter 15: Understanding Accounting and Financial Statements
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Sample Questions
Q1) All of the following are profitability ratios EXCEPT _____.
A) inventory turnover
B) return on equity
C) net profit margin
D) gross profit margin
Q2) Campbell Inc., a construction company, recorded a gross profit of $12,000. Its operating expenses stood at $2,000. The amount of depreciation was calculated to be $3,000. Campbell paid out $2,500 in income taxes. Which of the following figures captures Campbell's bottom line?
A) $10,000
B) $4,500
C) $3,500
D) $7,000
Q3) Diana asked her accountant to prepare a summary of the company's "bottom line." What specific information is Diana interested in?
A) Comparison of assets and liabilities
B) The company's financial position for that week
C) Net income after taxes
D) Statement of owners' equity
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Chapter 16: The Financial System
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Sample Questions
Q1) The SEC requires reports any time an investor accumulates more than 5 percent of a company's outstanding stock.
A)True
B)False
Q2) Underwriting is the process used by insurance companies to determine whom to insure and what to charge.
A)True
B)False
Q3) ___ are short-term securities issued by the U.S. Treasury and backed by the full faith and credit of the U.S. government.
A) Treasury bills
B) CDs
C) Commercial paper
D) Bonds
Q4) Bonds are issued in various denominations-face values-usually between $100 and $2,500.
A)True
B)False
Q5) Describe how the financial system operates.
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Chapter 17: Financial Management
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Sample Questions
Q1) Why do firms divest assets?
Q2) A(n) _____ is a sale of assets by a company.
A)Venture capitalists
B)private placements
C)factoring
D)capital investment analysis
E)debt capital
F)Equity capital
G)financial plan
H)leveraged buyout
I)private equity funds
J)divestiture
K)Marketable securities
L)financial manager
M)tender offer
N)Trade credit
O)leverage
P)capital structure
Q)Asset intensity
R)bonds
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Page 20