Business & Finance Review – Flashcards
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Which environment is NOT an important dimension of a business organization external environment?
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The corporate cultural environment
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What is profit?
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Difference between revenues and expenses
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What is the environment where a firm conducts business known as?
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Domestic business environment
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Factors such as international trade agreements, economic conditions, and political unrest will have the greatest impact on what type of business environment?
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Global business environment
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Which type of business environment can reduce or replace the need for traditional working methods, physical equipment, and other platforms needed to conduct business?
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Technological environment
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The pursuit of profits is how a business differs from organizations such as public universities, public hospitals, and government agencies. T/F
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TRUE
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An organizations external environment consists of everything that might affect it.T/F
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TRUE
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What is the general term for resources used by a business to produce a good or service referred to as?
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Factors of Proudction
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What term denotes a nation's basis for allocating its resources among its citizens?
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Economic system
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What is the process for converting government enterprises into individually owned firms known as?
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Privatization
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What is the term for the physical and intellectual contributions of people while engaged in the production of goods and services?
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Human resources
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Who is the person who accepts the risks and opportunities inherent in a new business opportunity?
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Entrepreneurs
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What factor of production is used to generate forecasts based on specialized knowledge and economic data?
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Information resources
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When making decisions about production and allocation, which type of system depends on individual producers and consumers to create a combination of supply and demand?
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Market economy
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The idea that individuals would contribute according to their abilities and receive benefits according to their needs supports which type of economy?
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Communist based economy
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Which of the following best explains the difference between a market economy and a planned economy?
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In a planned economy, consumers have little choice in where they work or what they purchase or pay.
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What type of economy is the United States reflective of?
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Mixed
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What does a planned economy rely on a centralized government to do?
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Allocate all or most factors of production
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Which economic system emphasizes the private ownership of most factors of production?
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Capitalism
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In which type of economy do the individual producer and consumer control production through supply and demand?
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Market economy
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The customs, values, and demographic characteristics of the society in which an organization functions are the principal elements of the political-legal environment. T/F?
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FALSE
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Physical resources include the data and other information used by businesses. T/F
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FALSE
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The technological environment includes only electronics and telecommunications used to perform business activities. T/F
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FALSE
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In a market system, individuals are limited as to what they can buy and in how they can spend their money. T/F
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FALSE
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In a market economy, there is a centralized government that controls factors of production and decision making.
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FALSE
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What is the point at which the supply curve and the demand curve intersect on a graph?
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equilibrium
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What is the price at which the quantity of goods demanded and the quantity of goods supplied are equal?
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Market price
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What occurs when the quantity demanded exceeds the quantity supplied?
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Shortage
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What marks the key difference between economic systems?
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The way the factors of production are managed
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What is the primary force that determines what a firm buys and sells?
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Laws of supply and demand
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What is the willingness and ability of producers to offer a good for sale referred to as?
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Supply
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What takes place when buyers purchase more of a product when the price drops, and less when the price increases?
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Laws of demand
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What can be used to determine relationships among different levels of demand and supply, based on price?
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Demand and supply curves
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Graphically, what has been achieved when price of goods demanded is equal to the quantity of goods supplied?
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Equilibrium price
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What are individual beliefs about what is right and wrong or good and bad referred to as?
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Ethics
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Which of the following should be the first step in assessing ethical behavior in a certain situation?
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Collect facts related to the situation.
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What is likely the single MOST effective step that a company can take to set ethical standards?
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Demonstrate support from top management
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How do top managers BEST demonstrate a commitment to ethical business practices?
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By adopting and enforcing written codes of ethics
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What category of ethics relates to matters such as hiring, firing, working conditions, privacy and respect?
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Behavior toward employees
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When an activity benefits an individual but not the employer, what ethical dilemma has been created?
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Conflict of interest
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What do ethical norms that ensure an action is consistent with what's fair entail?
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Justice
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Which ethical norm considers whether a particular act optimizes the benefits to those who are affected by it?
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Utility
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When evaluating a decision based on the ethical norm of rights, a manager is MOST likely to consider which of the following questions?
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Does the decision respect the individuals involved?
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Which of the following is the BEST description of organizational stakeholders?
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Individuals and groups that are directly affected by the practices of a company
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Standards that help to shape behaviors towards employees, the organization, and other economic agents are
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Managerial ethics
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Ethics are beliefs about what is right and wrong.
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TRUE
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Business ethics refers to ethical or unethical behaviors by employees in the context of their personal lives.
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FALSE
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A conflict of interest occurs when an activity may benefit the individual to the detriment of his or her employer.
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TRUE
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What is the term given to the groups, individuals, and organizations that are directly affected by the practices of an organization?
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organizational stakeholders
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Which entity is defined as independent and has little influence on its market?
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Small business
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The U.S. Department of Commerce considers a business "small" if it has fewer than how many employees?
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500
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Which of the following industry groups is the fastest growing segment of small business enterprise?
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Services
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Which of the following types of venue is favored by small-business retailers?
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specialty shop
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Why is it difficult to compare relative job growth for different-sized businesses?
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It is hard to determine the cutoff point at which a small business becomes a large business.
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Why do attitudes about entrepreneurship vary internationally?
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Attitudes towards risk-taking in business are culturally determined.
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When an investor is not interested in owning their own business, why do they need to understand entrepreneurship?
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To determine the key characteristics of success
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In a small business, who determines prices for wholesalers and customers?
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Market forces
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Small businesses impact key aspects of the U.S. economy including
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Job creation and innovation
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The Small Business Administration is the government agency charged with owning small businesses.
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FALSE
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Small businesses produce more patents per employee than large patenting firms.
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TRUE
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Most businesses in the United States are large businesses with more than 500 employees.
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FALSE
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Major innovations are most likely to come from large corporations.
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FALSE
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The Small Business Administration (SBA) may consider a business with many employees to be small as long as it has low annual revenues.
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...
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What are products that are created domestically and transported for sale abroad?
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Exports
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What are products that are created abroad and then transported and sold domestically?
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Imports
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Which country is the world's largest marketplace and most stable economy?
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The United States
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Which country in the Pacific Asia region has one of the world's largest economies?
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China
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Which organization was developed to promote economic and cultural cooperation among Asian countries?
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ASEAN
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Which organization created the classification of countries based on per capita income?
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The World Bank
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Under which of the following treaties are Canada, the United States, and Mexico gradually eliminating tariffs and all other trade barriers?
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The North American Free Trade Agreement
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What organization was founded in 1967 for economic, political, social, and cultural cooperation in the Asia Pacific region?
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ASEAN
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What is the primary force that determines what a firm buys and sells?
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Laws of supply and demand
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Which of the following treaties sought to eliminate trade barriers such as tariffs and quotas?
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General Agreement on Tariffs and Trade
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How does globalization of business benefit shareholders of an organization?
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Through increased and improved profitability
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What caused manufacturing jobs to move from Mexico to China in the late 1990s?
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Increases in Mexico's cost of living and wages
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Where is the world's largest free marketplace?
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Europe
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An import is a product made or grown abroad but sold domestically
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TRUE
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The World Trade Organization (WTO) was created to encourage international trade
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TRUE
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Globalization refers to the process by which countries around the world are becoming more self-sufficient.
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FALSE
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Which business constituents analyze their competitive environments and plan, organize, direct, and control the operations of their organizations?
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Managers
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Which aspect of the management process involves determining what the organization needs to do and how best to get it done?
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Planning
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What function of the management process is used to monitor and ensure the organization is meeting its goals?
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Controlling
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The first step in the planning process is determining goals. What is the next step?
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Developing a comprehensive strategy
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Which description defines the planning function of the management process?
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Determining what an organization needs to do and how best to get it done
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Which description identifies the organizing function of the management process?
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Determining how best to arrange an organization's resources into a coherent structure
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Which function in the management process is being utilized when a firm elects to move towards a more centralized structure?
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Organizing
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Which description identifies the controlling function of the management process?
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Monitoring a firm's performance to ensure that it is meeting its goals
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Comparing actual performance against standards is an example of which function of the management process?
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Controlling
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What type of management process function is being used when a manager motivates the workforce by rewarding them with additional vacation when standards are achieved?
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Leading
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When a sales manager compares actual sales to the quarterly sales quota, he or she is performing the controlling function of management.
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TRUE
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The first step in the control process is to compare actual performance to standards
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FALSE
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Which type of manager is responsible for implementing the strategies, policies, and decisions made by top managers?
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Middle manager
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Which type of manager spends most of their time working with and supervising the employees who report to them?
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First-line managers
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Which type of business constituent has titles such as President and CEO?
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top managers
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Which level of management is responsible for the overall performance and effectiveness of the firm?
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Top managers
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CFO and controller are titles associated with what type of manager?
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Financial
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Which level of management sets general policies, formulates strategies, approves all significant decisions, and represents the company in dealings with other firms and with government bodies?
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Top managers
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Titles such as plant manager, operations manager, and division manager designate which level of management?
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Middle managers
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The titles of supervisor, office manager, and group leader are examples of which level of management?
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First-line management
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Which of the following are responsible for production and quality control?
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operations managers
