Business Fundamentals
Exam Questions
Course Introduction
Business Fundamentals introduces students to the essential concepts and practices that form the foundation of the business world. Covering topics such as management, marketing, finance, operations, and entrepreneurship, this course provides insights into how organizations operate within both domestic and global environments. Students will explore basic business terminology, organizational structures, decision-making processes, and strategies for success in highly competitive environments. Through real-world case studies and interactive discussions, learners will develop practical skills and a broad understanding of the key principles needed to succeed in todays dynamic business landscape.
Recommended Textbook Business Essentials 8th Canadian Edition by
Ronald J. Ebert
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15 Chapters
4158 Verified Questions
4158 Flashcards
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Page 2
Chapter 1: Understanding the Canadian Business System
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250 Verified Questions
250 Flashcards
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Sample Questions
Q1) What provides the motivation for an entrepreneur to operate his or her business efficiently?
A) The right to vote
B) Private property rights
C) Competition
D) Privatization
E) Freedom of choice
Answer: C
Q2) The private enterprise system guarantees that competition among business firms will be fair.
A)True
B)False
Answer: False
Q3) The reasons why the government regulates many aspects of business activity include protecting competition, protecting consumers, achieving social goals, and protecting the environment.
A)True
B)False
Answer: True
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Page 3
Chapter 2: The Environment of Business
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235 Verified Questions
235 Flashcards
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Sample Questions
Q1) GNP is the total value of all the goods and services produced by an economic system during a period, regardless of where the factors of production are located.
A)True
B)False
Answer: True
Q2) Why are customer preferences and tastes important to business?
Answer: Tastes and preferences determine what products and services will sell in various geographic regions and among various ethnic groups in Canada.
Q3) Some industries are relatively easy to enter, but automobile manufacturing is not because
A) the market is saturated.
B) it is very capital-intensive.
C) it is a foreign market.
D) it is too labour intensive.
E) none of these is correct.
Answer: B
Q4) What is a recession?
Answer: A recession is a period during which aggregate output declines.
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Chapter 3: Conducting Business Ethically and Responsibly
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275 Verified Questions
275 Flashcards
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Sample Questions
Q1) The United Nations "cap and trade" system gives certain companies (i.e., those that have bought carbon credits) the right to pollute the atmosphere.
A)True
B)False
Answer: True
Q2) When a food company lists the ingredients that make up their products, which consumer right is it addressing?
A) Right to choose
B) Right to safe products
C) Right to courteous service
D) Right to be informed
E) Right to be heard
Answer: D
Q3) What is the purpose of a written code of ethics?
Answer: A written code of ethics formally announces a company's intent to do business in an ethical manner. A company's commitment to ethical business practices is formalized through a written code of ethics.
Q4) What is recycling?
Answer: It is the conversion of certain waste materials into useful products.
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Chapter 4: Entrepreneurship, Small Business, and New
Venture Creation
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243 Verified Questions
243 Flashcards
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Sample Questions
Q1) If sole proprietor Tom decided to merge his business with that of Cindy, another sole proprietor, a ________ would result.
A) partnership
B) T-4A special corporation
C) publicly-traded corporation
D) dual proprietorship
E) co-operative
Q2) Describe the criteria used to screen an entrepreneur's idea.
Q3) In the double taxation endured by some businesses, ________ is the first taxation and ________ is the second taxation.
A) tax on corporate profits; value-added tax
B) tax on dividends; tax on corporate profits
C) tax on corporate profits; tax on dividends
D) property tax; income tax
E) social security tax; income tax
Q4) List the major parts of a good business plan.
Q5) What are the advantages and disadvantages of the corporate form of organization?
Q6) What are the two most widely used methods to form a corporation?
Q7) How is the Canadian economy affected by small businesses?
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Chapter 5: The Global Context of Business
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260 Verified Questions
260 Flashcards
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Sample Questions
Q1) In marketing its new product in a foreign nation, Mega Computer was surprised to see the very low prices on its local competitor's models. Subsequent investigation revealed that the domestic businesses had received money from the government. Mega now knows what a(n) ________ is.
A) subsidy
B) tariff
C) embargo
D) local content law
E) quota
Q2) "All this talk about a global economy is relevant only for big firms. My company is too small for that type of thinking." Agree or disagree with this statement, and support your position.
Q3) What is an expected result when a nation devalues its currency?
A) Export sales of its products decline.
B) The number of independent agents declines.
C) Export sales of its products increase.
D) No result is more likely than any other.
E) Export sales of its products will be unchanged.
Q4) What is the difference between the balance of trade and the balance of payments?
Q5) What countries are covered under NAFTA?
Page 7
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Chapter 6: Managing the Business Enterprise
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271 Verified Questions
271 Flashcards
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Sample Questions
Q1) What are the three general categories of roles that Mintzberg identified in his study of managers?
Q2) Describing managers' jobs by referring to functions like planning, organizing, leading, and controlling gives us a good general picture of what managers do, but it may not give a clear idea of the specific activities that managers are involved in.
A)True
B)False
Q3) Amy Madison has been tracking product sales for McCoy Industries. She notices that sales of surgical supplies have fallen off in the past six months and she is considering strategies to reverse this trend. This is an example of the ________ management function.
A) planning
B) organizing C) leading D) controlling E) negotiation
Q4) Describe the three steps in strategy formulation.
Q5) List and briefly describe the basic steps in the rational decision-making process.
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Chapter 7: Organizing the Business Enterprise
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278 Verified Questions
278 Flashcards
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Sample Questions
Q1) All-Canadian Burger is a nationwide fast food chain that competes with McDonald's, Burger King, and Wendy's. Management at All-Canadian Burger is debating whether to have a more centralized or a more decentralized organizational structure. Which of the following questions would different All-Canadian Burger restaurants be most likely to answer differently?
A) What color should All-Canadian Burger restaurants be?
B) What are the core values of All-Canadian Burger?
C) What price should All-Canadian Burger charge for its products?
D) What policies should be put in place to prevent sexual harassment in the workplace?
E) What ingredients should be used when making the food products that made All-Canadian's Burger famous?
Q2) What is delegation? Why do some managers have trouble delegating? What problem arises when managers fail to delegate?
Q3) What is a boundaryless organization?
Q4) In a centralized organization, most of the decision-making authority is held by upper-level managers.
A)True
B)False
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Page 9
Chapter 8: Managing Human Resources and Labour Relations
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293 Verified Questions
293 Flashcards
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Sample Questions
Q1) The process by which union leaders and management personnel negotiate common terms and conditions of employment is known as
A) mediation.
B) collective bargaining.
C) labour unions.
D) arbitration.
E) certification.
Q2) Why are unions more reluctant to strike than formerly?
Q3) The Canadian Human Rights Act guarantees a job to any qualified person who wants one.
A)True
B)False
Q4) The Canada Labour Code prohibits paying employees on a piece-rate system.
A)True
B)False
Q5) When does an impasse occur? What are some of the actions which unions can take when their demands are not met?
Page 10
Q6) What three issues are typically most important to union negotiators?
Q7) Describe the human resources development process.
Q8) What is a piece-rate incentive plan?
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Chapter 9: Motivating, Satisfying, and Leading Employees
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319 Verified Questions
319 Flashcards
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Sample Questions
Q1) How does expectancy theory explain employee motivation?
Q2) What is power? What are the five sources of power that are available to leaders?
Q3) Self-awareness, empathy, and social skills are all part of A) attitudes.
B) emotional intelligence.
C) personality.
D) self-esteem.
E) organizational citizenship.
Q4) Agreeableness, emotionality, and extroversion are all part of A) EQ.
B) emotional intelligence.
C) personality.
D) attitude.
E) organizational commitment.
Q5) Attitudes contain three components: satisfaction, performance, and motivation. A)True
B)False
Q6) Female leaders tend to be more nurturing and supportive than male leaders. A)True
B)False
Page 12
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Chapter 10: Operations Management, Productivity, and Quality
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300 Verified Questions
300 Flashcards
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Sample Questions
Q1) When a company turns out ornaments in time for Christmas, this is an illustration of ownership utility.
A)True
B)False
Q2) How should capacity planning be done for service businesses?
Q3) Which term identifies the results of a quality/cost study that identified expenses incurred during production before unacceptable products leave the plant?
A) External failures
B) Six Sigma
C) Quality circles
D) Boundary-spanning failures
E) Internal failures
Q4) What is a process layout?
Q5) The process of materials management not only controls but also plans and organizes the flow of materials.
A)True
B)False
Q6) Discuss the current concept of "production" including recent trends.
Q7) What is statistical process control?
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Chapter 11: Understanding Accounting
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258 Verified Questions
258 Flashcards
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Sample Questions
Q1) Due to a downturn in the local economy, Bob is concerned about converting his assets to cash quickly. In accounting terms, he is apprehensive about A) current assets.
B) liquidity.
C) turnover.
D) net income.
E) marketable securities.
Q2) Describe how computing financial ratios can help users get more information from financial statements to determine the financial strengths of a business.
Q3) The amount of profit or loss will be reflected in the A) balance sheet.
B) cost of goods sold.
C) quick ratio.
D) income statement.
E) statement of cash flow.
Q4) List the potential users of accounting information.
Q5) What is the difference between public and private accountants?
Q6) What is the difference between current and long-term liabilities?
Q7) What is the difference between financial accounting and managerial accounting?
Page 14
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Chapter 12: Understanding Marketing Principles and Developing Products
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324 Verified Questions
324 Flashcards
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Sample Questions
Q1) Buildings, manufacturing equipment, computers, and desks are examples of ________ purchased by companies that make other goods.
A) impulse items
B) capital items
C) current expenses
D) fixed expenses
E) expense items
Q2) Briefly explain what occurs in each stage of the new product development process.
Q3) Which of the following is correct with regard to the elements in the marketing mix?
A) Of the four elements, "product" is generally least important.
B) The elements are all equally important, regardless of the product being sold.
C) Price plays a small role in fresh meat, but a relatively larger role in selling newspapers.
D) Distribution is not very important in marketing gasoline, but it is important for lumber.
E) Promotion is vital in selling toys, but much less important in selling nails.
Q4) What is the first step in the consumer buying process?
Q5) List the four stages in the product life cycle.
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Chapter 13: Pricing, Promotion, and Distributing Products
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296 Verified Questions
296 Flashcards
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Sample Questions
Q1) When Burger King tells you about a new restaurant that it is opening near you, it is attempting to fulfill which promotional objective?
A) Remind you about the product
B) Communicate information
C) Positioning products
D) Controlling sales volume
E) Eliminate competition
Q2) What are Superior's options in promoting the Superior VI?
Q3) The communications vehicle that appeals to many consumer senses, can be targeted to a specific audience, and reaches more people than any other medium is
A) magazines.
B) radio.
C) television.
D) newspaper.
E) direct mail.
Q4) Why are the concepts of "fixed costs" and "variable costs" important?
Q5) List three pricing tactics.
Q6) What is a markup?
Q7) List five sales promotion tools.
Page 16
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Chapter 14: Money and Banking
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226 Verified Questions
226 Flashcards
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Sample Questions
Q1) A financial corporation that specializes in financing installment purchases made by individuals and firms is called a
A) consumer finance company.
B) factoring company.
C) credit union.
D) sales finance company.
E) commercial finance company.
Q2) As of January 2015, the value of M-1 was
A) $38.5 million.
B) $987 million.
C) $730.3 billion.
D) $975.2 billion.
E) $1.6 trillion.
Q3) Money functions as a medium of exchange, a unit of account, and a store of value.
A)True
B)False
Q4) What is M-1 and what are the major elements that make it up?
Q5) Describe the functions of the Bank of Canada and describe the tools it uses to control the money supply.
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Chapter 15: Finacial Decisions and Risk Management
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330 Verified Questions
330 Flashcards
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Sample Questions
Q1) Which of the following represents the overall objective of financial managers?
A) To ensure that the company has enough funds on hand to purchase materials needed to produce goods and services
B) To ensure that the company has enough money to pay for its debts
C) To increase the supply of money for the economy
D) To increase the value of the firm and thus to increase shareholder wealth
E) To manage the firm's cash flow
Q2) Explain how the Rule of 72 works using an example.
Q3) What questions must the financial manager ask in order to develop a sound financial plan?
Q4) Cut out but not-yet-sewn jeans are part of the ________ inventory at a clothing manufacturer.
A) raw materials
B) work-in-process
C) finished goods
D) just-in-time
E) last in, first out
Q5) Explain how various financial instruments (government bonds, common stock, etc.) relate to each other in terms of risk and return.
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