Business Strategy
Pre-Test Questions
Course Introduction
Business Strategy explores the formulation, implementation, and evaluation of strategies that enable organizations to achieve a sustained competitive advantage in dynamic environments. The course covers foundational concepts such as strategic analysis, industry and competitor assessment, resource allocation, and the development of long-term objectives. Students will examine real-world cases to understand approaches to corporate, business, and functional-level strategies, as well as challenges posed by globalization, innovation, and ethical considerations. The course equips students with analytical tools and frameworks to assess complex business situations and to make informed, strategic decisions that drive organizational growth and performance.
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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Chapter 1: The Changing Face of Business
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156 Verified Questions
156 Flashcards
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Sample Questions
Q1) The business philosophy that advocates determining what consumers want and need, and then designing products to satisfy those needs, is known as _____.
A) consumer orientation
B) self-sufficiency
C) work ethics
D) production enhancement
Answer: A
Q2) Which of the following is NOT an example of an internal force that requires organizational change?
A) Labor union demands
B) Production problems
C) New technologies
D) New company goals
Answer: C
Q3) During the era of Industrial Revolution, the focus was on agriculture and other rural activities.
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) Paying corporate taxes is an example of corporate philanthropy.
A)True
B)False
Answer: False
Q2) Adhering to deeply felt ethical principles in business situations is known as loyalty.
A)True
B)False Answer: False
Q3) Bente knows of a defect in a product his company sells. He will disclose the defect but only if the customer specifically asks about it. Bente's _____ could be called into question.
A) altruism
B) integrity
C) loyalty
D) truthfulness
Answer: B
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Page 4
Chapter 3: Economic Challenges Facing Contemporary Business
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179 Verified Questions
179 Flashcards
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Sample Questions
Q1) Describe the major differences between socialism and a mixed economic system.
Answer: In a socialist economy, the government owns industries that are considered to be of vital importance, such as energy firms, major manufacturing firms, and transportation systems. Socialist countries allow limited private ownership of small businesses and industries that are not considered to be as vital. In a mixed economy, a strong private sector exists. It is much larger than the private sector in a socialist economy. In a mixed economy, some public enterprises operate as well. The rights to profits are stronger in a mixed economy and even public enterprises are expected to produce returns Worker incentives also are stronger in a mixed economy than they are in a socialist economy.
Q2) As the number of suppliers of a product increases, the supply curve shifts to the _____ and the price will _____.
A) right; fall
B) right; rise
C) left; fall
D) left; rise
Answer: A
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Page 5
Chapter 4: Competing in World Markets
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171 Verified Questions
171 Flashcards
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Sample Questions
Q1) The United States has an international trade deficit in the sale and purchase of goods but a trade surplus in services.
A)True
B)False
Q2) Under a multidomestic strategy, each national market is treated equally.
A)True
B)False
Q3) A global marketing approach is ideal for marketing luxury items due to their universal appeal.
A)True
B)False
Q4) Economically speaking, unlike countries included in the EU, the United States is a national market with a single economy.
A)True
B)False
Q5) The International Monetary Fund (IMF) was created to promote trade through financial cooperation.
A)True
B)False
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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) Describe the complexity of franchise agreements.
Q2) First-time business owners often overestimate the funds their firms will generate from initial sales to allow for operations to continue.
A)True
B)False
Q3) Which of the following statements regarding family-owned businesses is true?
A) Only a small percentage of family-owned businesses survive into the second or third generation.
B) Family-owned companies must submit a written agreement to the state in which it organizes.
C) All family-owned companies must be closed corporations.
D) Family-owned companies are an example of a not-for-profit corporation.
Q4) A reason small businesses are so successful is also the reason they might fail-their founders are willing to take a risk.
A)True B)False
Q5) Why are small businesses especially important to women and minorities?
Q6) What is a business incubator?
Q7) Describe three primary reasons why a small business might fail.
Page 7
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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) Gary is in the process of using debt financing to fund his new venture. In this case, he is most likely to:
A) borrow loans from banks.
B) obtain funding from venture capitalists.
C) secure funding from angel investors.
D) exchange a share of ownership in his company for money.
Q2) Which of the following statements regarding globalization and entrepreneurship is correct?
A) The business ownership rate is highest in economies that compete based on unskilled labor.
B) Most entrepreneurs are from countries whose economies are driven by innovation. C) Entrepreneurship is least common in Latin America, Sub-Saharan Africa, and the Caribbean.
D) The United States leads in the percentage of adults engaged in entrepreneurship.
Q3) Entrepreneurs are often easily discouraged by setbacks and failures.
A)True
B)False
Q4) What is intrapreneurship, and why is it important today?
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) Solomon's firm is divided into work units representing human resources, marketing, production, and finance. This is known as _____ departmentalization.
A) product
B) geographical
C) functional
D) process
Q2) The first step in the decision-making process is to:
A) develop alternative courses of action.
B) evaluate alternatives.
C) recognize a problem or opportunity.
D) select and implement the chosen alternative.
Q3) In the strategic planning process, before developing a mission statement, a company must determine their current or potential position in the marketplace.
A)True
B)False
Q4) Mission statements must be short.
A)True
B)False
Page 9
Q5) Compare the four types of organizational structures.
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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) A key management tactic involving unions is the lockout.
A)True
B)False
Q2) The desire to be accepted by family, friends, and co-workers is what Maslow called _____ needs.
A) physiological
B) esteem
C) social
D) self-actualization
Q3) Ricardo is a middle manager for Intellect Corp. He has requested an evaluation by a panel to include coworkers, superiors, subordinates, and several of the company's clients. This type of evaluation is called a _____.
A) management development program
B) Professional Analysis, Inc. (PAI) review
C) status performance appraisal
D) 360-degree performance review
Q4) Explain the advantages of Internet recruiting.
Q5) Describe collective bargaining.
Q7) Explain Victor Vroom's expectancy theory. Page 10
Q6) What is downsizing? How is it different from outsourcing?
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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) Which of the following statements is correct regarding stock option plans?
A) They are offered only to top-level executives and members of the board of directors.
B) Employees are likely to exercise their option to purchase the stock, if the stock price increases.
C) The company holds the stock for the benefit of the employees.
D) Stock options are provided as a retirement benefit.
Q2) An example of affective conflict is when teams reconcile differences to produce the best possible solution.
A)True
B)False
Q3) When responding during a crisis, it is best if the executive speaks briefly, clearly and provides positive visual images.
A)True
B)False
Q4) What are some of the challenges associated with e-mail?
Q5) Team cohesiveness does not often affect morale.
A)True
B)False
12
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Chapter 10: Production and Operations Management
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166 Flashcards
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Sample Questions
Q1) Quality, prices, dependability of delivery, and services offered by competing companies are some of the main things companies will take into consideration when selecting a supplier.
A)True
B)False
Q2) Just-in-time inventory systems shift much of the responsibility for carrying inventory to vendors.
A)True
B)False
Q3) Which of the following is a disadvantage of mass production?
A) Workers perform specialized tasks.
B) Managers are seldom able to create conditions for high productivity.
C) It is inefficient for producing small batches of different items.
D) It moves the product along a conveyor belt past a number of workstations.
Q4) Salim is planning to manufacture an energy drink, "Hobz drink". Which of the following facility layout should he use?
A) Process
B) Product
C) Fixed-position
D) Customer-oriented
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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) A(n) _____ is a marketing effort sponsored by an organization that solicits involvement by individuals who share common interests and activities.
A)secondary data
B)affinity program
C)Market segmentation
D)demographic
E)target market
F)End-use segmentation
G)marketing mix
H)data mining
I)Consumer behavior
J)Ownership utility
K)Exchange process
L)B2B
M)person marketing
N)Mass customization
O)frequency marketing
P)Comarketing
Q)cobranding
Q2) Compare comarketing and cobranding. Give an example of each.
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Page 14
Chapter 12: Product and Distribution Strategies
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184 Flashcards
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Sample Questions
Q1) Describe the benefits of having marketing intermediaries and provide an example.
Q2) A portable drill is classified as which of the following?
A) Accessory equipment
B) Shopping products
C) Specialty products
D) Capital item
Q3) Goods and services are classified as either consumer or business, depending on the _____.
A) amount of service required on the item
B) buying motives of the purchasers
C) cost of the particular item
D) purchasers of the particular item as consumers or businesses
Q4) One product may be considered a shopping product by one consumer and a convenience product by another consumer.
A)True
B)False
Q5) To reach a target market with a small number of buyers, a direct distribution channel is often the best choice.
A)True
B)False
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Chapter 13: Promotion and Pricing Strategies
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157 Verified Questions
157 Flashcards
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Sample Questions
Q1) Assume fixed costs equal $480,000. The selling price per unit is $10, and the variable cost per unit of $8 produces a $2 per unit contribution to fixed costs. Find the breakeven point in terms of both units and in dollars.
Q2) Which of the following pricing objectives will have the most influence on Phin's, a luxury watchmaker's, pricing strategy?
A) Profitability
B) Prestige
C) Meeting the competition
D) Volume
Q3) Most marketing managers believe that the price-quality relationship holds for a wide variety of prices.
A)True
B)False
Q4) Marketers rarely try to combine pushing and pulling strategies in the same promotional campaign.
A)True
B)False
Q5) Describe how the Internet has changed advertising and provide examples.
Q6) Describe the relationship between price and quality.
Page 16
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Chapter 14: Using Technology to Manage Information
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117 Flashcards
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Sample Questions
Q1) Explain the difference between hardware and software. Give examples of both.
Q2) Credit card applications are often evaluated using executive systems.
A)True
B)False
Q3) Which of the following is considered information rather than data?
A) projected population growth in a target market
B) a measure of the effectiveness of a promotional strategy
C) income distribution in a target market
D) product sales in various categories
Q4) Deciding how to prevent system failures along with the ability to continue operations if computer systems fail is called ________.
A) disaster recovery planning
B) information systems management
C) advanced computer security
D) virus protection
Q5) An intranet links a company to its suppliers and customers.
A)True
B)False
Q6) Describe a wide area network and explain how companies use it.
Q7) Describe at least two ways in which common cybercrimes occur.
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Chapter 15: Understanding Accounting and Financial Statements
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136 Flashcards
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Sample Questions
Q1) When examining a statement of cash flows, investors obtain relevant information about a firm's cash receipts and payments for its operations, investments, and financing during an accounting period.
A)True
B)False
Q2) The GAAP standard of relevance ensures that one firm's financial statements can be compared with those of similar businesses.
A)True
B)False
Q3) _____ activities focus on providing valuable assets to a business.
A) Marketing
B) Investing
C) Selling
D) Operating
Q4) All of the following are assets EXCEPT _____.
A) inventory
B) cash
C) patents
D) bank loans
Page 18
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Chapter 16: The Financial System
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Sample Questions
Q1) The ___ establishes and updates rules to ensure that member brokers perform their basic functions honestly and fairly.
A) NASD
B) NASDAQ
C) NYSE
D) FDIC
Q2) Explain what a credit union is and give an example of one.
Q3) Savings banks have greatly expanded their business lending activities in recent years while cutting back on their home mortgage lending activity.
A)True
B)False
Q4) What is the Federal Reserve's most important function? How does this function affect the nation's rate of inflation and employment?
Q5) Sales of most corporate and municipal securities are made via auctions.
A)True
B)False
Q6) The New York Stock Exchange (NYSE) is a secondary market.
A)True
B)False
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Chapter 17: Financial Management
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Sample Questions
Q1) Public sales can vary substantially from year to year depending on the conditions in the financial markets.
A)True
B)False
Q2) Hedge funds are private investment companies open only to large qualified investors.
A)True
B)False
Q3) Ben has three subordinates that report to him. They include the treasurer, the controller, and the vice president for financial management. In the context of the role of a financial manager, Ben is the _____ of his organization.
A) CEO
B) COO
C) CFO
D) CRO
Q4) What is the purpose of a financial plan?
Q5) What is an LBO?
Q6) Why do firms divest assets?
Q7) Explain each role in the hierarchy of financial management at a large firm.
Page 20
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