intro to mgmt midterm 1

what are the 3 top factors of production?

land, labor, capital

Public schools, charities, and government agencies generally

do not seek to earn a profit

T/F. The main difference between a B2C and B2B e-commerce is that B2C is only used online, while B2B combines e-commerce with traditional (brick and mortar) outlets

False! B2C\= business to consumer (sells mainly to households)

B2B\= business to business (sells to other businesses)

T/F. he only real purpose of a business is to make money for entrepreneurs

False, business don't just make money fro entrepreneurs, the provide all of us with the necessities such as food, clothing, housing, medical care, and transportation, as well as other goods and services that make our lives easier and better.

T/F. One reason given for the decline in the number of US workers employed in manufacturing is that manufacturing firms int he US have become more efficient

true, with technology\= more productivity\= increase efficiency\= fewer workers needed

in order to compete well and gain market share, contemporary businesses are changing to be more

customer-driven

T/F. political freedom, quality education, access to health care, and a clean environment are all factors that contribute to an improved quality of life

true

T/F. staring a business is a riskier path toward business success that working your way up the ranks of a large business

true

what is a benefit of owning your own business

freedom to keep the profits from your business

what policies would tend to foster entrepreneurship?

minimize taxes and regulations

T/F. the amount of profit or loss earned by a business can be found by subtracting the firm's expenses from its revenues

true

T/F. Nonprofit organizations are similar to for-profit business in that they often provide goods and services that satisfy the needs of society

true

T/F. business use demographic studies to understand where people live, their lifestyles, and what they are likely to buy

treu

Trevor earned the same amount of money this year as he did last year. Thus his standard of living must be the same as it was last year

false

what is standard of living

standard of living refers to the amount of goods people can buy with the money that they have. there are two factors that determine the standard of living: a person's earning and the price of goods and services. if the prices of goods and services have increased or decreased over the past year, so has the standard of living even if the amount earned is the same

what is an advantage of utilizing technology in business

productivity increases

T/F. the failure to uphold high ethical business standards by a few companies can negatively impact the entire US business community

true

T/F. elite party rentals a store serving the houston-area wedding industry generated total revenues of $10 million while incurring expenses of $8 million. Elite Party rentals earns a profit of $2 million

true

randall owns a nursery. the trucks, handcarts and forklift he purchases for the business are called

capital investments

websure is an online company that provides support services for business that need help in setting up and maintaining their websites. Websure is an example of a company that is engaged in \___ e- commerce

B2B

a common characteristic of most entrepreneurs is that they

accept the risks involved in starting and managing a business

T/F. Paid vacations and health care insurance are among the benefits provided by the gov. to entrepreneurs

false

T/F. Elana has joined several other investors to form a new company that sells UV protection clothing to consumers online. Elana has invested in a B2C e-commerce company

true

last year, jensen consulting reported revenues of $34 million while its total expenses were $10 million. based on this information, jensen reported

profits of $24 million

which organization is an example of the good-producing sector of the economy?

Samsung electronics

appliance repair firms, tax consultants, law firms, and insurance companies are all business firms that are part of the \____ sector

service

T/F. since all business make a profit, starting a business is not risky

false

T/F. revenues is the amount a business earns above and beyond what it spends for expenses and costs

false

Which business policy would most likely help a singl-parent family

allowing family leave and flextime

In most industives, the only produces that pose a serious threat to US manufactures are those in Japan and western Europe

false--\> china and india

what is the best example of a business whose goal is to earn a profit

amazon

the standard of living for a nation's people depends mainly on

their income and the price of goods and services they can buy

T/F. The US embargo against all trade with with Venezuela. Irnm, syria, and norrh korea most likely result of

political disagreements

Japanese automobile producers sold more of their Japanese production overseas than they sold in Japan. Their business strategy emphasizes:

exporting

the market price of milk is falling, in a few-market economy, the most likely explanation of this price change is that

there is a surplus in the market for milk

Which individual would tend to favor a socialist economy?

Amber prefers to live in a country that promotes social equality.

A prominent economics professor recently urged government policy makers to cut taxes and increase government spending in order to pull the economy out of a downturn. These policy measures are examples of fiscal policy.

true

As you are reading the online edition of your local newspaper, you quickly scan a report in the business section that says government spending will again exceed tax revenues in the current year. What does this mean for the economy?

the total national det is likely to increase

T/F. An example of a U.S. import would be the purchase of oil by U.S. companies from Saudi Arabia.

true

Which policy suggest keynesian economic theory

short-term increases in government spending to stimulate the economy

T/F history shows that free- market capitalism leads to a fair and equitable distribution of wealth

false

T/F. in any given year, the US cash outflow to other nation excess its cash inflow from other nations

true

The value of goods imported into Spain exceeds the value of Spanish exports. This indicates that Spain

has a trade deficit

Adam Smith believed that an economic system couldn't truly prosper unless people were taught to value the welfare of others above their own personal gain.

false

One reason the CPI is monitored very closely by government, businesses, and workers is that

some wages, interest rates, tax rates, and government benefits are tied to changes in the value of the CPI.

T/F. In order to enjoy the highest standard of living possible, comparative advantage theory states that all nations should strive to become self-sufficient.

false\-- The theory of comparative advantage states that a country should export those goods that it produces most efficiently and import those goods that it cannot produce as efficiently.

just a few sellers dominate the markets for laundry detergents, soft drinks, and automobiles. Economists would classify these markets as

oligopolies

When the market price of a good is below the equilibrium price, and all other determinants are unchanged,

the quantity demanded will be greater than the quantity supplied.

For a firm to be considered a multinational corporation, which condition must be true?

It must have manufacturing facilities and a physical presence in several countries.

T/F. A devaluation of the U.S. dollar would make American goods cheaper to foreign buyers.

true

What indicator provides the clearest indication that an economy is experiencing deflation?

decreases in the CPI

T/F. If tourists from England spend money shopping and attending theater productions in New York, it will increase the United States's unfavorable balance of payments.

false --An unfavorable balance of payments occurs when more money is flowing out of a country than is flowing into that country. Foreign tourists spending money in the United States provide an inflow of money.

T/F. Free trade can negatively impact some companies.

true

T/F. the same proven management styles used by companies in their domestic operations should automatically be employed in their foreign subsidiaries.

false

T/F. Macroeconomics looks at long-term economic problems while microeconomics examines short-term economic problems.

false

T/F. Government controls and regulations are not needed in a free market system.

false

what strategy may have a net effect on inflation

proportionately increasing wages and increasing prices

T/F. If two nations have a trade dispute, the World Trade Organization may be asked to mediate and provide a decision within one year's time.

true

T/F. The Fed is concerned that the economy is growing too rapidly. Given these concerns, it is likely to pursue policies to restrict the supply of money and raise interest rates.

true

T/F A prediction that GDP will increase significantly over the next six months is bad news for most businesspeople

false\-- An increase in the GDP would indicate that the output of final goods and services is rising. This indicates a healthy and growing economy, which would be good news to most businesses.

T/F Studies about the effects of population growth on the economy are part of macroeconomics.

true

the presence of competition in free markets

usually results in better quality and lower prices.

The social audit is

a company evaluation that measures the firm's social contributions inside and outside the firm

a phone call to a gov official by an employee of the Enron corp. disclosed the deception and dishonesty of the firm's accounting records. This employee played the role of a

whistleblower

T/F. while telling an abusive joke about an ethical group may not be unlawful, it is unethical

true

T/F. defining a socially responsible company is complicated. Businesses differ from other businesses, as well as the people they serve, on what we mean by 'socially responsible"

true

T/F. the Enron scandal illustrates the difference between unethical behavior and illegal behavior

false

T/F. management can create an environment in which unethical behavior can develop

true

ethical behavior will typically result in

improved, self-esteem, making us feel good about our decision

some critics of corporate social responsibility view spending money on CSR as

stealing from investors

T/F. applying the ethical standards of the US to foreign firms is a difficult process for US firms

true

T/F. an important step in improving US business ethics is for companies to hire whistleblowers

false (usually not purposefully hired)

T/F. a code of ethics designed to avoid criminal misconduct is an example of a complianced based ethics code

true

a firm's carbon footprint is

the amount of carbon it releases in its effort to do business

when managers disregard the company's ethical concerns, the likely result is

a general mistrust between workers and management

Laws represent the standards of \___ behavior

legal

T/F. to be effective an organization code of ethics should be kept in house and not communicated to outsiders such as suppliers, subcontractors, and customers

false

T/F. employees observe behavior, which helps instill standards of right and wrong

true

the danger in writing new laws to correct behavior is that

people may begin to think that any behavior that is legal is ethically acceptable

the management staff at Andy's service center believe the company has a social responsibility to its community. They believe that the company can have the greatest impact in this area through cash contributions to local nonprofit organizations. This is an example of

corporate philanthropy

T/F. employers should proceed cautiously when designing an employee incentive program that rewards employees strictly on increased sales

true

T/F. punishing business leaders who have broken the law may help restore trust in the free-market system and leaders in general

true

T/F. moral behavior refers to behavior that is accepted by society as right rather than wrong

true

what situation would most likely involve ethical concerns?

overstating an expense report

T/F. legal behavior is a first step towards ethical behavior

true (ethical behavior requires more than following the law, but following the law is an important first step)

ethical behavior covers a \____ range of conduct than legal behavior

broader

T/F. Utilizing the phrase 'the ends justify the means' as a corporate value system can negatively impact company moral and competitiveness

true

T/F. opponents of corporate social responsibility argue that when companies use their profits to promote social causes, they are not being fair to investors who provided the funds for the purpose of financial gain.

true

T/F. often it is the threat of negative publicity that pressures business to enforce their corporate code of ethics

true

purposefully understating your firm's income to avoid paying higher taxes is an example of

illegal behavior

following an ethics-based approach to decision making will normally lead to higher

trust and cooperation

T/F. in order to avoid the costly act of being sued in court, it makes good sense to manage you business ethically

true

a distinguishing feature of a cooperative is that it

is owned and operated by the people who use it

enterprise zones and investor visas are examples of

government programs that encourage growth through entrepreneurship

entrepreneurs applying for a bank loan should realize that bankers will

expect the entrepreneur to provide a business plan

T/F. for 11 years Maria and Charles have owned a car detailing business as partners. now they would like their younger brother to join them. Unfortunately, partnership law states that only two partners can participate in a partnership

false ( 2 or more owners unless written in the original partnership)

historically, entrepreneurs int he US

started many small firms that later became big corporations employing thousands of workers

According to SBA guidelines, a manufacturing firm with 1000 employees

may be classified as a small business depending upon the size of others in the same industry

T/F. sole proprietorships are taxed at the owner's personal tax rate

true