Flashcards About Unit 2: Entrepreneurship
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An activity which seeks to earn a profit by providing a good or service is known as a(n) a. Business b. Corporation c. Industry d. Organization e. Service
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a. Business
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Starting a business always involves ___________
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d. Risk
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_______ is the chance a business owner will lose the time and money invested in a business that does not make money.
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d. Risk
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_______ is the known chance that a business owner will lose the time and money invested in a business that proves to be unprofitable; and _________ is the unknown chance that a business owner will either be rewarded for or lose the time and money invested in a business.
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c. risk, uncertainity
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Often in business the greater the risk an entrepreneur or manager decided to take the
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c. Greater the uncertainty associated with the risk
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Which of the following is the situation with the highest risk? a. High upside, low downside b. High upside, high downside c.Low upside, low downside d.Low upside, high downside e.All of the above have the same level of risk
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d. Low upside, high downside
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Which of the following is the situation with the highest uncertainty?
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b. high upside, high downside
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Match the factors of production for business management with their defining characteristics 8. Capital 9. Entrepreneurship 10. Labor 11. Land 12. Technology a. Defines the owners of the firm b. Most immobile factor of production, after real estate c. The most important and scarce of the factors of production d. The quantity of this factor of production never decreases e. The quantity of this factor of production very rarely increases
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8. a 9. c 10. b 11. e 12. d
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As a factor of production, the term capital includes
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e. tools, machinery and building
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Two factors of production that seem to contribute most to a nation's ability to create wealth are
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b.Entrepreneurship and knowledge
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Money is one of the five factors of production that contribute to the creation of wealth
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False
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The major advantage rich nations have over poor nations is an abundance of land and labor
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False
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The only real purpose of a business is to make money for entrepreneurs
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False
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Entrepreneurs, by definition, aspire to accumulate great wealth
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False
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If a person has managerial skills and leadership ability, s/he also possesses the personality to be an entrepreneur
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False
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A team may be better than an individual entrepreneur because team members can combine creative skills with production and marketing skills from the beginning.
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True
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An entrepreneurial team is a group of experienced managers who share the same skills and abilities
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False
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An entrepreneurial team is a group of experienced managers who share the same skills and abilities a. self-disciplined b. risk averse c. highly energetic d. self-nurturing e. action oriented
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b. risk averse
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Which of the following explains why individuals accept the risks of business ownership? a. The challenge of seeking prestige b. The desire to work fewer hours c. The potential for learning how to be self-disciplined d. The potential of a lucrative IPO e. The sense of self-satisfaction and independence
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e.The sense of self-satisfaction and independence
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Which of the following statements is characteristic of successful entrepreneurs? a. They have the ability to visualize a clear path b. They like certainty c. They look at problems and see opportunities d. They prefer to be inventive rather than worry about whether the invention solves a customer need e. They stick to a methodical plan and approach
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c. They look at problems and see opportunities
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a. People willing to accept the risk of starting and managing a stand-alone business without access to commercial banking b. People willing to accept the risk of starting and managing a stand-alone business c. People willing to accept the risk of starting and managing a business within a larger firm
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a. Micropreneurs b. Entrepreneurs c. Intrapreneurs
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Lifestyle businesses differ from high-growth ventures in that: a. High-growth startups tend to last longer than lifestyle startups b. High-growth ventures are business characterized by ambitious sales while lifestyle businesses are characterized by low growth in sales c. Lifestyle businesses are service-oriented businesses whereas high-growth ventures are product-oriented businesses d. Lifestyle businesses don't utilize technology while high-growth ventures do utilize technology
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b. High-growth ventures are business characterized by ambitious sales while lifestyle businesses are characterized by low growth in sales
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Classify the following individuals according to the type of entrepreneurial activity they engage in: 30. Erin developed a new type of exercise equipment she calls the Tush N' Tone. After unsuccessfully searching for potential investors, she arranged a personal loan and borrowed additional money from her parents. 31. Jake is an innovative engineering graduate who works for a large company that makes adhesive products for commercial and consumer use. One of his primary responsibilities is to initiate and develop new products to complement the firm's current product line. 32. Pete inherited a thriving dry cleaning business from his father and mother. He continued the tradition of offering quality service to the customers he served. As the surrounding towns expanded, several people suggested that Pete expand the business to offer service in new locations. He chose to maintain only one operation, so as not to lose control and to keep his work life and home life balanced.
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30. a. Entrepreneur 31. b. Intrapreneur 32. c. Micropreneur
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Most startups succeed
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False
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The easiest businesses to start are those that offer the greatest profit potential
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False
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Which of the following statements is false? a. Corporate management has been the training ground for many new entrepreneurs; b. Entrepreneurs are well advised to avoid starting businesses in the same market in which they were previously employed; c. Individuals who desire to learn about small business operations would be well advised to learn from other entrepreneurs; d. Many entrepreneurs get the ideas for their own businesses from their experience of working for others; e. There is no better way to learn about small business operations than to work for a small business owner.
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b. Entrepreneurs are well advised to avoid starting businesses in the same market in which they were previously employed;
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In discussions with bankers, entrepreneurs should be prepared to personally guarantee loans to their startup.
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True
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The most common small business failures occur in businesses that are the easiest to start
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True
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The majority of start-up businesses fail within their first year.
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True
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The single biggest cause of failure for small businesses is undercapitalization
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False
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The most common cause of failure for small startups is
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a. Not enough marketing effort
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Which of the following statements about small business is false? a. A business is considered small by comparing its size to others in the same industry; b. According to the SBA, small businesses must be independently owned and operated; c. Small businesses create 75% of the new jobs in the United States; d. Small businesses often can provide more personalized business service than bigger rivals; e. The principles of management for a small business are different than those for a large corporation.
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e. The principles of management for a small business are different than those for a large corporation.
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The majority of businesses in America are:
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e. small businesses
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Personal contact with the customer is the most promising marketing avenue for a small business
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True
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Entrepreneurs looking for a business that gives them the best opportunity to get rich should consider starting a business in:
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d. the manufacturing sector
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When comparing small businesses to their larger competitors, it is clear that: a. bigger is always better. b. small firms are slower to respond to opportunities than are large firms. c. small firms can always outperform big firms on a level playing field. d. small firms often can offer more personalized customer services than big firms. e. b. and c.
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d. small firms often can offer more personalized customer services than big firms.
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A review of small business successes and failures indicates that the:
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businesses with potential of high profit levels tend to be difficult to start and hard to keep going.
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As a result of corporate downsizing, Alex lost his job as an information systems manager for a large telecommunications company. A bonafide computer geek in his own right, Alex knew that several of his past company contacts often outsourced their computer problems. He decided it was a good time to test the waters and see if he could secure enough computer clients to be in business for himself. His success demonstrated that: a. entrepreneurial initiative is a poor substitute for an stable job. b. people always tend to hire people they know from past associations. c. starting your own business can quickly provide security and profits. d. successful big businesses often create profitable opportunities for small businesses. e. the service sector is not an area of significant growth.
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d. successful big businesses often create profitable opportunities for small businesses.
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Assign to the following entrepreneurial situations the most likely reason for failure: 48. After selling his software business for a sizeable profit, software engineer Gus Greene decided to try something different. He would become a general contractor on a large condo development in an upcoming area of Atlanta, Georgia. He invested several million and then borrowed another $30 million (or 75% of the project cost) from a lending institution. He based his borrowing risk on the assumption that the housing market would continue to appreciate for several years to come. As the housing market began a free-fall in early 2008 and continued into 2009, Gus saw his business crashing around him. Sales were very meager and the bank wanted its money back. 49. Jennifer, a talented photography major started a corporate photography business. She planned to solicit jobs from large corporations who needed pictures for their annual reports and websites. Although filling a unique niche, Jennifer needed the security that the business would thrive and that she would earn enough to support herself and her child. She also hoped that she would spend less time each day calling on potential clients and more time doing the actual shoots. 50. When Krystal Ginger graduates from culinary school she dreams of opening her own Asian fusion restaurant. Her other passion is skiing in Colorado, where she schedules four or five trips each year. a. Franchising is a business creation strategy that is sure to succeed in creating profits and free time. b. Having little knowledge about the industry and market an entrepreneur enters increases the chances of failure significantly. c. It is difficult for entrepreneurs to achieve ease of entry, security, and good profits quickly. Entrepreneurs need to make plans in the event that one or more of these do not materialize quickly. d. Not taking enough risk results in potential disappointment and failure. e. The easier it is to start a business, the more labor intensive they tend to be and the greatest failure rate they tend to have.
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48. b 49. c 50. e
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Match the forms of ownership with their defining characteristic 1. Easiest to start and to terminate 2. Endures double taxation 3. Is the most affected by disagreements among owners 4. It's closely connected with the needs of its owners 5. Provides a proven business blueprint
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1. e. sole proprietorship 2. b. corporation 3. d. partnership 4. a. cooperative 5. c. Franchise
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Match the following profiles with the form of ownership most likely to succeed for their startup ventures. 6. Bobby is a just graduated Ph.D. in chemistry. He believes that his research findings can be turned into a valuable biotech company. 7. Cathy is dissatisfied with the choices of foodstuffs available in town. She organizes a few similarly minded friends and acquaintances and starts an independent food retailer; 8. Earl has just retired from a successful corporate career. Earl and his wife, Elsie, reckon that they can work for another 10 to 15 years and they'd like to open a business "to keep busy"; however, they do not have an idea they'd like to exploit; 9. Roger and Margaret are MD's: Roger is an OB/GYN and Margaret is a pediatrician. They are married and expect that starting a practice together will leverage their knowledge while allowing them to work under the same roof; 10. Shirley is a freelance photographer. She enjoys her work and likes the freedom to accept or reject assignments. Anyways, freelance photography is an extension of her favorite hobby.
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6. b. corporation 7. a. cooperative 8. c. franchise 9. d. partnership 10. e. sole proprietorship
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Match the characteristic with its respective form of business. a. Unlimited Liability b. Perpetual life c. Recognized name 11. Corporations 12. Sole proprietorships 13. Franchises 14. Partnerships
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11. b. perpetual life 12. a. unlimited life 13. c. recognized name 14. a. unlimited life
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Match the forms of business organization with their characteristics a. Easiest to setup b. Most difficult to control c. Most prone to internal conflict d. Subject to double-taxation e. Subject to profit-sharing
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a. sole proprietorship b. cooperative c. partnership d. corporation e. franchise
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The _________ is the most common form of business ownership
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d. sole proprietorship
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Which is the easiest kind of business firm to start and terminate?
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e. sole proprietorship
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To many businesspeople, one of the major attractions of a sole proprietorship is:
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c. The chance to be their own boss.
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With respect to taxes, the sole proprietorship: a. Is permitted to determine its own tax rate and schedule of payments. b. Pays taxes on the expenses associated with the business. c. Pays taxes on the gross sales of the business. d. Pays taxes on the profits of the business at the same rate that corporations pay taxes. e. Pays taxes on the profits of the business, at the owner's personal tax rate.
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e. Pays taxes on the profits of the business, at the owner's personal tax rate.
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Which of the following is not a characteristic of a sole proprietorship? a. A sole proprietorship is the easiest form of business ownership to start and end. b. Owners of sole proprietorships have unlimited liability for the firm's debt. c. Owning a sole proprietorship may require overwhelming time commitments on the part of the owner. d. The profits earned by a sole proprietorship are the property of its owner, minus taxes owed to the government. e. When a sole proprietor dies the company closes down.
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d The profits earned by a sole proprietorship are the property of its owner, minus taxes owed to the government.
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Any debts or damages incurred by a firm organized as a sole proprietorship are:
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d. the responsibility of the owner
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In a partnership, a(n) _______ partner (owner) actively manages the company and has unlimited liability for claims against the firm
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b. general
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A partner (owner) who invests money in a business, does not take an active role in managing the operation, and is only subject to losing the funds he/she invested a. Associate partner b. Limited partner c. Partial partner d. Particular partner e. Specific partner
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b. limited partner
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Compared to a sole proprietorship, which of the following is considered an advantage of a general partnership?
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a. ability to pool financial resources
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Which of the following is an advantage of a partnership? a. Division of profits b. Ease of starting and ending the business c. Little time commitment d. Shared management and pooled skills e. Unlimited liability
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d. Shared management and pooled skills
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When entering into a new partnership, a good strategy is to:
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e. put the partnership agreement in writing
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One difference between partnerships and sole proprietorships is that partnerships: a. Are managed by an elected board of directors. b. Do not survive as long as sole proprietorships because of partner disagreements. c. Have a greater chance of long term survival due to the accountability of each partner to the other. d. Have the advantage of limited liability. e. Take less work to form.
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c. Have a greater chance of long term survival due to the accountability of each partner to the other.
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One way to eliminate some of the risk of your partners making costly mistakes that could jeopardize your personal assets is to set-up a:
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c. Limited liability partnership
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The corporation is the most common form of business ownership
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False
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Compared to partnerships and sole proprietorships, a major advantage of the C (conventional) corporation as a form of business is that it:
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b. has the ability to raise more money
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The Board of Directors of a corporation represents the corporations'
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c. shareholders
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Match the forms of business organization with their characteristics 36. Corporation 37. Partnership 38. Sole proprietorship a. Easiest to setup b. Most difficult to control c. Most prone to internal conflict
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36. b. most difficult to control 37. c. most prone to internal conflict 38. a. easiest to setup
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Indicate which of the following statements is true: a. Corporations are easy to start and easy to terminate; b. Stockholders in a corporation exert a significant degree of control over the company's daily operations; c. Stockholders in a corporation must accept unlimited liability for it's debts; d. To change ownership in a corporation you must sell your stock to someone else; e. When an owner of a corporation dies, the corporation legally ceases to exist.
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d. To change ownership in a corporation you must sell your stock to someone else;
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The form of business organization that is best suited to raising large amounts of money for expansion is the
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c. corporation
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The Board of Directors for a corporation is elected by its
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b. stockholders
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Limited liability, difficult termination, and high initial cost are characteristic of:
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c. corporation
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Which form of ownership allows for the largest accumulation of resources?
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b. corporation
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The Board of Directors can ask for the resignation of the CEO of the corporation
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a. True
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Corporations have the highest revenue of all forms of ownership in the USA
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True
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Which of the following is not an advantage of the corporate form? a. Ease of management b. Ease of ownership change c. Limited liability d. Perpetual life e. Size
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a. ease of management
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To change ownership in a corporation you simply need to sell your stock to someone else
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True
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Which of the following is an advantage of the corporate form of business when compared to sole proprietorships and partnerships? a. Clear lines of management responsibility b. Ease of formation c. Limited liability of owners d. Lower taxes e. Simplified paperwork
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c. Limited liability of owners
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A separation between ownership and management is most likely to occur in a:
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b. Corporation.
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50. 50. Emilywants to open a chain of hair styling salons and hopes to attract investors to help finance. She considered forming a corporation, but she wants to have more flexibility about how the new businesses will be taxed. She also wants to offer investors/owners limited liability. Emily can satisfy her objectives by setting up a(n):
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c. limited liability company
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Match the given organizational activities with the function of management they are part of: 1. Determining whether an organization is making sufficient progress toward achieving its goals and objectives and developing corrective measures; 2. Giving front-line workers additional resources needed to provide faster and better service to customers; 3. Looking at market forecasts to identify future business opportunities and challenges; 4. Training and coaching workers to help them understand their job and perform it effectively.
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1. d. controlling 2. b. organizing 3. a. planning 4. c. leading
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a. Creating a vision for the organization and guiding, training, coaching, and motivating employees to help achieve the goals and objectives of the organization. b. Creating conditions and systems to ensure that everything and everyone works together to achieve the organization's goals c. Determining whether an organization is progressing toward its goals, rewarding employees for doing a good job, and taking corrective action when they are not d. Setting of goals, strategies, and tactics for achieving the organization's goals and objectives e. Utilizing organizational resources to accomplish goals at work
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a. Leading b. Management c. Controlling d. Planning e. Organizing
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Match the following definitions with the appropriate steps of the management cycle 10. Allocate resources, assigning tasks, and establishing procedures; 11. Check to determine whether or not an organization is progressing toward its objectives, and taking corrective action if it is not; 12. Motivate employees and creating the environment for employees to motivate themselves; 13. Set the organizational vision, goals and objectives.
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10. c. organize 11. a. control 12. b. lead 13. d. plan
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What is the accepted order of the management cycle?
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d. planning, organizing, leading, controlling
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Communicating with employees and coaching them so that they understand their job and can perform it effectively;
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b. leading
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Devising a strategy to enter a foreign market currently dominated by a competing firm;
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e. planning
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Examining a financial report to see whether the firm's profits are improving and taking corrective action if they are not;
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a. controlling
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Recruiting qualified workers to join a business, assigning them to their proper position;
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d. organizing
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Which of the following should form the foundation of a firm's control system?
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a. Accounting and finance
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Match the following definitions with the appropriate management skills 20. Ability of a manager to perform the tasks associated with a specific discipline or department; 21. Ability to picture an organization as a whole and the relationship among its various parts; 22. Leadership, coaching, morale building and supportiveness.
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20. e. technical 21. a. conceptual 22. c. human relations
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What is the order of development of management skills?
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c. Technical, conceptual (human relations should develop constantly)
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After working for eleven years as a production line worker, Hollis recently was made a foreman. In his new position, Hollis will rely on: a. Conceptual skills more than human relations skills b. Marketing and sales skills c. Technical skills and conceptual skills, but he won't really need any human relations skills d. Technical skills and human relations skills more than conceptual skills e. Technical skills solely
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d. Technical skills and human relations skills more than conceptual skills
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Ricardo works as a departmental head at Barnes Hospital. His job requires Ricardo to spend most of his time training and coaching employees to perform their jobs more effectively and teaching other managers to be better leaders. Ricardo's job requires him to make full use of his:
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b. human relations skills
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As CEO of Google, Larry Page performs strategic planning for the organization as well as putting structure in place to monitor company progress. These activities make use of Larry's
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a. conceptual skills
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Supervisory level managers usually work more with people than with ideas
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True
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Because of the complex nature of their jobs, top managers spend most of their time developing or using technical skills
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False
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The level of management that is directly responsible for assigning specific jobs to workers and evaluating their daily performance is called:
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d. supervisory management
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The experience acquired by first-line managers as they perform their jobs enables them to acquire all the skills they will need when promoted to higher levels of management
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False
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Middle managers are responsible for: a. assigning specific jobs and evaluating the daily performance of workers. b. developing tactical plans and controlling. c. devising the organization's strategic plan. d. establishing the vision for the organization. e. All of the above.
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b. developing tactical plans and controlling.
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General and divisional managers, plant managers, and deans and department heads at colleges are classified as:
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b. middle management
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Supervisory managers spend most of their time on:
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d. technical and human relations skills
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___________ skills involve a manager's ability to picture the organization as a whole and the relationship among its various parts.
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Conceptual
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____________ skills include the ability to perform tasks of a specific department or job, such as selling (marketing) or bookkeeping (accounting).
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e. technical
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Leadership, coaching, and morale building are all part of a manager's _________ skills.
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c. human relations
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Although top managers most often possess these skills, they usually make less use of __________ skills than supervisory managers.
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e. technical
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The further up the managerial ladder a person moves, the __________ his or her original job skills become.
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a. less important
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By completing the courses needed to obtain a college major in accounting, marketing, or some other field, a student can go a long way toward acquiring the _________ skills managers need to rise through the ranks of their area of specialization.
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e. technical
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Match the following statements with the appropriate management skill 40. First line managers must have a high degree of ______________ to carry out their main responsibilities. 41. Middle-level managers must have a high degree of __________because they act as the bridge between departments, coordinating people and projects. 42. Top-level managers must demonstrate excellent ____________ because they must be able to envision the organization as a whole and to understand how all of the parts fit together.
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40. c. technical skills 41. b. human relations skills 42. a. conceptual skills
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A comparison of the specific types of skills used by the different levels of management suggests that: a. first line managers have very little need for technical skills but make extensive use of both human and conceptual skills. b. middle managers mainly rely on technical skills, top managers mainly rely on human skills, and first line managers mainly rely on conceptual skills. c. top-level managers are the only level of management that must use both human and technical skills. d. top-level managers call on their conceptual skills more than other levels of management do. e. None of the above.
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d. top-level managers call on their conceptual skills more than other levels of management do.
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Please attach the following statements about the Lifeline Express to the components of the management cycle they belong to 44. Project work starts a month before the train reaches its planned destination. The Lifeline team liaises with the local administration to make sure all the red tape (ie. permits) and publicity are dealt with before the train arrives. 45. The Lifeline Express began with one three wagon train in 1991. Since then, it has added one five wagon additional train. It operates both, with the help of Indian Railways. 46. The Lifeline Express has reached half a million people in India, and has inspired and helped to startup other such ventures in countries such as Bangladesh, China and Zimbabwe. 47. The main challenge whenever the Lifeline Express reaches a destination is to create awareness of its presence and to create an environment where large numbers of patients can be quickly attended to.
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44. d. controlling 45. b. organizing 46. a. planning 47. c. leading
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Again, in reference to the Lifeline Express, please attach the following statements about the Lifeline Express to the managerial skills they belong to. 48. The Lifeline Express is run by Impact India, a not-for-profit supported by Impact UK, the Tata Group and Indian Railways, counting with the contributions of philanthropic organizations such as the Ford Foundation and USAID, and working closely with corporate backers and Indian state governments for its field visits. 49. The main challenge whenever the Lifeline Express reaches a destination is to create awareness of its presence and to create an environment where large numbers of patients can be quickly attended to. 50. The train has only a few permanent staffers (cook, technician, maintenance). All medical specialists (surgeons, doctors, nurses, anesthetists) are volunteers, providing the equivalent of US$80,000 of donated time for every project. At any time, a 20 person medical team is on the
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48. c. conceptual skills 49. b. human relations skills 50. a. technical skills
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Operations management is a function that is concerned with the production of both goods and services?
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True
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Which of the following is not part of operations management? a. Facility location b. Inventory management c. Production scheduling d. Quality control e. Supply chain management
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e. supply chain management
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The concept of __________ suggests that as a firm produces more, the average cost of goods produced goes down.
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e. economies of scale
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The traditional manifestation of mass production was to:
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c. Make large quantities of a limited variety of products at very low cost
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In manufacturing, a __________ is frequently used in operations that serve different customer's different needs a. Assembly line b. Fixed-position layout c. Job shop layout d. Mass production approach e. Process plant
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c. job shop layout
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One of the beneficial effects of ________ is a reduction of the cost of holding too much inventory
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e. Just-in-time inventory control
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According to the TQM philosophy, what should be a company's primary goal?
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c. costumer focus and satisfaction
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Operations managers at Alumax Corporation have found that they can achieve efficient production only by producing very large quantities of aluminum without shutting down the production process. This indicates that Alumax should use a(n) ________ production process. a. Craft production b. Assembly line c. Continuous flow d. PERT/CPM e. MRP
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c. continuous flow
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Which of the following pricing strategies requires, to succeed in the long term, the most efficient use of economies of scale?
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b. everyday low pricing
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The choice of production technique for responding precisely to customer needs is: a. Craft production b. Mass production in assembly line c. Mass production in process plants
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a. craft production
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Total quality management techniques can reduce the amount of labor used in the production process, but only if there is an increase in the amount of other resources used.
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False
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The whole idea behind mass production was to: a. Give producers the maximum flexibility to respond to customer preferences. b. Give workers more control over their work environment. c. Make large quantities of a limited variety of products at very low cost. d. Produce goods of the highest possible quality. e. All of the above
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c. Make large quantities of a limited variety of products at very low cost.
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Which has the lowest cost per unit? a. Craft production b. Mass production c. Process plant
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c. process plant
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Which has the highest flexibility? a. Craft production b. Mass production c. Process plant
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a. craft production
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15. In an economies of scale regime, costs per unit
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b. Decrease with increased volume of production
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In craft production, ______________ determine the cost of production
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b. variable costs
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In mass production, ______________ determine the cost of production
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a. fixed costs
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When we say that an industry benefits from economies of scale, we mean that a. In that industry it is difficult to scale production processes; b. In that industry there is an inverse relationship between total cost of production and unit costs; c. That industry benefits from oversized products; d. All of the above e. None of the above
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b. In that industry there is an inverse relationship between total cost of production and unit costs;
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Which of the following statements is false? a. Mass production simplifies production processes b. Mass production refers to the efficient production of a large quantity of goods c. The concept of economies of scale suggests that the bigger a plant, the more efficient production becomes d. The concept of economies of scale suggests that the average cost of goods decreases as production levels increase e. The production of cars, computers, and houses has benefited from mass production
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c. The concept of economies of scale suggests that the bigger a plant, the more efficient production becomes
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Match the following concepts with their definition: 20. Craft production 21. Mass production in assembly line 22. Mass production in process plant 23. Lean production - TQM - continuous improvement a. Characterized by short production runs and frequent changes of machinery in order to produce different products b. Characterized by very long production runs in specialized machinery c. Uses both technology and process innovations to produce high quality goods while decreasing its need for resources d. Uses single purpose, capital intensive production investments
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20. d 21. b 22. a 23. c
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A manufacturing startup is most likely to use mass production techniques
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False
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Match the products with the best operative regime: 25. Custom made furniture 26. Manufacturing of small runs of specialized industrial fittings 27. Production of high grade steel from scrap 28. Standardized plumbing products, such as pipe fittings and valves a. Craft production b. Mass production, assembly line c. Mass production, process plant d. Total quality management, lean production
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25. a. craft production 26. d. TQM 27. c. Mass production, process plant 28.b. Mass production, assembly line
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Economies of scale occur when a firm operates more efficiently as it grows larger
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True
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Craft production allows for high customization and variability in the product
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True
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Quality costs money
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False
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Match the conditions of operation with the best operative regime 32. Maximum product variety 33. Maximum product uniformity 34. Best combination of variety and uniformity a. Craft production b. Mass production c. Total quality management
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32. a. craft production 33. b. mass production 34. c. TQM
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_______________ is the process of selecting a geographic location for a company's operations.
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c. Facility location
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_______________ is the physical arrangement of resources in the production process. a. ERP
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b. Facility layout
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The operations planning practice of inputting sales forecasts into computer software that accurately predicts amount and timing of materials needed to complete products and projects is:
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Materials Requirement Planning
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Brake Parts Inc., manufacturer of Raybestos brand brakes, is at the forefront of the replacement brake industry as a result of its ongoing commitment to continuous product improvement and its uncompromising dedication to providing customers with the most advanced, premium quality product technology through teamwork. In other words, Brake Parts is committed to ____.
answer
d. TQM
question
Contemporary producers and their suppliers: a. Locate in areas where they can compete for the same pool of labor b. Know that it is not necessary to locate in close proximity due to technologies such as the Internet c. Locate close together to reduce costs of distribution and coordination d. Use sophisticated information systems to avoid the need to interact face to face e. Have much more market power than the retailers and distributors who sell their products to customers
answer
b. Know that it is not necessary to locate in close proximity due to technologies such as the Internet
question
__________ is a computer application that enables a firm to combine computerized functions of all divisions and subsidiaries of the firm into a single, integrated software program that uses a single database.
answer
b. Enterprise resource planning (ERP)
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Which of the following would be most helpful to a production manager who wanted to determine the minimum time required to complete a proposed project?
answer
d. PERT/ CPM
question
Maintaining _________ involves producing what the customer wants while reducing errors before and after delivery to the customer
answer
Quality
question
Match the following corporations and operational activities to the location criterion that would be most important for them 43. Exxon/Mobil, oil production 44. Google, access to quality employees 45. McDonald's, fast food retail sites
answer
43. c. Lowest cost resources based location 44. a. "Cluster" 45. b Highest access to customer based locations
question
Due to such developments as the Internet and virtual organizations, the cost of labor is no longer an important consideration in location decisions of business firms.
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False
question
Six sigma is a quality measure that allows only 3.4 defects per million opportunities
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True
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Under the six sigma quality standard the idea is to detect potential problems to prevent their occurrence
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True
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The Malcolm Baldridge Quality Award goes to any firm that achieves the six sigma quality standard in the production of its goods
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False
question
ISO14000 standards deal with the same quality issues as ISO9000 standards, but represent an even higher standard of achievement
answer
False
