Multiple choice questions: 1) Which of the following, if true, would strengthen the argument in favor of a price increase? A) Substitutes for Widgets are available in the market.
Multiple choice questions:
1) Which of the following, if true, would strengthen the argument in favor of a price increase?
A) Substitutes for Widgets are available in the market.
B) The price of materials consumed along with Widgets has gone up.
C) A change in the environment is likely to stimulate overall demand for Widgets.
D) Competitors have announced that they intend to keep prices at current levels.
E) Relaxation of import restrictions would lead to foreign competitors flooding the market.
2) Ernesto’s Pizza is about to offer customers a new variety of a personal pizza. Which of the following actions by Ernesto’s Pizza would most likely prevent a surplus or a shortage of the personal pizzas in its first week?
A) lower the price of the pizza throughout the week
B) lower demand for the personal pizza
C) estimate the market price of the personal pizza
D) set the price of substitute goods
E) limit the supply of the personal pizza
3) The global business environment encompasses many international forces that influence the outcomes of companies doing business in foreign countries. Which of the following scenarios would best count as evidence of globalization?
A) Diamonds mined in Country X are sold on the markets in Country Y. The proceeds are then used to fund a coup against the government in Country X.
B) Farmers in Country X have lost most of their wheat crops due to a drought. The market price for wheat triples and the government pays the farmers for a percentage of the lost wheat.
C) Country X has raised the tax on oil products. As a result more people are taking public transportation and reducing unnecessary car travel.
D) A natural disaster disables factories in Country X that produce computer chips for Company Y. Company Y reduces the number of employee shifts and raises the price of its products.
E) Country X has almost mined all of its available natural energy sources. The government has been investing in alternative energy research for years and now an efficient synthetic energy source has been developed.
4) Which of the following is the most likely pricing approach for a monopoly?
A) Undercut the prices of the competition.
B) Charge customers whatever you please.
C) Give customers a fair price that cannot be matched by competitors.
D) Give customers a real bargain on price.
E) Charge a price that will not cause consumer demand to drop.
The economy in the African nation Sponeto has been stagnant for a long time. The government and central bank of Sponeto have been considering options for what can be done to help stimulate investment and growth in the economy.
5) The Sponeto national bank advocates increasing the money supply to encourage investment within the country. Which of the following, if true, would strengthen the case that this will cause inflation?
A) Jobs will be created.
B) Banks will lower interest rates.
C) Wages will decrease.
D) Foreign investment will be discouraged.
E) Only low-technology sectors will benefit.
6) Which economic system emphasizes the private ownership of most factors of production?
A) Marxism
B) federalism
C) communism
D) socialism
E) capitalism
7) In the city of Westminster, Christmas trees are being sold for $25. At this price, buyers are able to satisfy their demand, though some trees remain unsold. What is the term used to describe this market condition?
A) surplus
B) equilibrium price
C) demand deficit
D) stoppage
E) shortage
8) What is a chief goal of an economic system?
A) income equality
B) product innovation
C) national debt reduction
D) money supply growth
E) economic stability
9) Which of the following best gives the meaning of the term business cycle?
A) the number of businesses started during a given time period
B) the conditions of the economic system in which an organization operates
C) the pattern of short-term ups and downs in an economy
D) the total quantity and quality of goods and services that a country’s citizens can purchase with the currency used in their economic system
E) the measure of economic growth that compares how much a system produces with the resources needed to produce it
10) Which indicator refers to the total quantity of goods and services produced by an economic system during a given period?
A) aggregate output
B) the consumer price index
C) the business cycle
D) gross national product
E) gross domestic product
11) Which of the following best describes what the consumer price index is used to indicate?
A) the average wage rate for a given region
B) the number of price increases within a given period of time
C) the changes in the cost of consumer products over time
D) the percentage of consumers in the total population looking for work
E) the economic performance of key consumer product companies
12) Which of the following statements is most likely to be included in a company’s code of ethics?
A) We strive for domination in the market.
B) We reward high achievers.
C) We achieve our objective by raising capital.
D) We reward all valuable contributions.
E) We believe in our company brand.
13) When evaluating a decision based on the ethical norm of rights, a manager is most likely to consider which of the following questions?
A) Is the decision consistent with people’s responsibilities to each other?
B) Does the decision comply with current legislation?
C) Does the decision respect the individuals involved?
D) Is the decision consistent with what we regard as fair?
E) Does the decision optimize the benefits for those who are affected by it?
14) Acme Inc. meets its legal and ethical requirements. In addition, Acme donates $50,000 per year to local charities when asked. Which of the following approaches is being taken by Acme toward social responsibility?
A) defensive
B) proactive
C) reactive
D) accommodative
E) obstructionist
15) Carla’s Collegiate Exchange, a popular bookseller among university students, has just drafted its mission statement. The company seeks to sell books on a sliding scale based on a student’s available income.
What does this MOST likely reveal about the company’s ethical code?
A) The company believes financially challenged students should not be hindered from succeeding educationally.
B) The company is most motivated by a desire for greater profits.
C) The company is not concerned with fostering the success of others.
D) The company believes that poor individuals should be given a greater chance at success than are wealthy individuals.
E) The company is indifferent to people’s financial well-being.
16) Which of the following is NOT an element of green marketing?
A) profitability
B) sustainability
C) product modification
D) packaging reduction
E) production processes
17) Save-a-Bunch Hardware has tripled its prices for plywood and other building supplies after a tornado strikes the area. What business practice is Save-a-Bunch Hardware demonstrating?
A) price wars
B) price fixing
C) collusion
D) buying out competitors
E) price gouging
18) Approximately what percent of all U.S. businesses employ 20 or fewer people?
A) 89.29 percent
B) 16 percent
C) 26 percent
D) 66 percent
E) 46 percent
19) What does a start-up company need in order to estimate the required size of a plant, store, or office, to decide how much inventory to carry, and to determine how many employees to hire?
A) funding source
B) tax estimate
C) stock options
D) sales forecast
E) business objective
20) What percent of all businesses in the United States are corporations?
A) 75 percent
B) 15 percent
C) 85 percent
D) 17 percent
E) 50 percent
21) By what percent has the number of African American-owned businesses increased over the past five-year period?
A) 48 percent
B) 18 percent
C) 78 percent
D) 28 percent
E) 60.5 percent
22) Which course of action should the Federal Reserve take if it wishes to reduce inflation and curb consumer spending?
A) The Federal Reserve should lower the discount rate.
B) The Federal Reserve should buy securities.
C) The Federal Reserve should sell securities and lower the discount rate.
D) The Federal Reserve should sell securities.
E) The Federal Reserve should decrease the reserve requirement.
AB Distributors is a company that serves as a shipping intermediary for other companies. Its sales revenue has increased from the previous year. Jonathan, a sales manager at AB, says, “Since the company has increased its revenue, it is now more profitable.”
23) Which of the following, if true, would most strongly support Jonathan’s contention?
A) AB Distributor is a relatively new company.
B) AB Distributor is a for-profit company.
C) AB Distributor’s costs have decreased from the previous year.
D) AB Distributor’s competitors have had increased revenue.
E) AB Distributor has hired more employees recently.
The economy in the African nation Sponeto has been stagnant for a long time. The government and central bank of Sponeto have been considering options for what can be done to help stimulate investment and growth in the economy.
24) Many in the Sponeto government agree that increasing the money supply to the nation’s economy would be of significant help to the country. The national bank’s reserve, however, is short on the funds needed, and suggests asking for them from the International Monetary Fund (IMF). Which of the following, if true, would strengthen the case for this course of action?
A) The IMF has been known to force donor countries to drop tariffs put in place to protect domestic industries.
B) The IMF has been known to force donor countries to privatize national companies.
C) The IMF contributes money as well as financial advice to help countries with economies suffering from balance-of-payment problems.
D) IMF loans typically come with many conditions attached that may result in increased poverty in the donor country.
E) A number of developing countries have suffered financial disasters from following IMF advice.
25) A new U.S. company plans to introduce an inexpensive, high-quality line of shoes to the American market. It has found a manufacturer in another country that can produce the shoes at a low enough cost that they will still be cheaper than other brands of the same quality.
Which of the following represents a potential ethical implication that the company should consider before beginning production?
A) the energy demands of the manufacturer’s facility
B) the average exchange rate of the country’s currency over a ten-year period
C) the basic international business strategy it will use
D) the country’s existing labor laws and the factory working conditions
E) the challenges of doing business in a country with a nonconvertible currency
An entrepreneur, Christina Rossini, is planning to open a small chain of 4 to 6 pizza stores under the brand name “Redenda Pizza.” The name comes from combining the first names of the entrepreneur’s grandparents. Christina wants to have a competitive advantage by offering innovative and distinct specialty pizzas and by offering the freshest ingredients. However, she is concerned that without proper planning, her venture will not be successful.
26) Which of the following BEST explains why flexibility is an important quality that Christina needs for success?
A) It takes a certain amount of money to start a business.
B) It often helps to have a business partner in a new business.
C) Starting a new business requires a great deal of planning.
D) Starting and running a new business involves many unpredictable factors.
E) An entrepreneur must be extremely competent in business skills.
27) Which figures reflect the current size and the growth in Hispanic-owned businesses for the last five years?
A) 2.75 million and 41 percent
B) 3.55 million and 81 percent
C) 4.25 million and 85 percent
D) 2.25 million and 31 percent
E) 3.15 million and 71 percent
28) Honata Automobiles is a South Korean-owned company. Honata has factories in Indonesia and Brazil. Which of the following is/are affected by the production of Honata automobiles?
A) Indonesia, Brazil, and South Korea’s GDP
B) Indonesia and Brazil’s GDP
C) Indonesia and Brazil’s GNP
D) Indonesia, Brazil, and South Korea’s GNP
E) South Korea’s GDP
29) How often should an organization change its objectives?
A) every year
B) never
C) infrequently
D) every decade
E) constantly
In the past, only India’s elite could afford to buy a car. But recent dramatic changes in India’s economy have produced a growing middle class and rapidly rising incomes. Now, to meet the new demand, established automakers are introducing smaller, more affordable vehicles into India. But they will have to find a way to compete with India’s Tata Motors, which has unveiled the least expensive car ever in this market, the Tata Nano. The Nano sells for only 100,000 rupees (about US $2,200). It seats four passengers, gets 50 miles per gallon, and travels at a top speed of 60 miles per hour.
30) Based on the information above, Tata most likely believed that as a result of recent changes in India’s economy, what would be true of a growing number of Indian consumers?
A) They had become even more cost-conscious than ever before.
B) They would be willing and able to spend 100,000 rupees on a car.
C) They would choose a vehicle with high fuel efficiency primarily because of concern about the natural environment.
D) They will eventually prefer models similar to those currently available in the U.S. and Europe.
E) They will place a higher value on car safety than fuel economy.
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