Multiple Choice Answers

1. The Fair Labor Standards Act
Established the federal minimum wage.
Legalized collective bargaining.
Outlawed union shops
Outlawed secondary boycotts.
2.  Team diversity is often established in a_____ team, by bringing together the expertise of members from various functions in the organization.
A. Problem-solving
B. Cross- functional
C. Working
D. Self-managed
3. Efficiency means producing_____using the least amount of
Capital; natural items.
Goods; resources.
Entrepreneurship; people.
Human resources; time.

4. Television is an attractive advertising medium because it
A. Provides instant feedback, which can be used to measure effectiveness.
B. Offers mass coverage and flexibility.
C. Offers a rapidly growing network audience.
D Is relatively inexpensive.
5. What prompted Congress to enact the Sarbanes-Oxley Act in 2002?
A. Major companies requested government regulation following negative publicity.
B. Congress wanted to make accounting practices more efficient.
C .A series of improper financial disclosures were found during investigations.
D. Stockholders petititioned for increased access to financial records.

6. Student Betty says that physical distribution includes both transportation and storage. Student Bob says that exchange includes both buying and selling. Which student is correct?
Both
Neither
Bob only
Betty only
7. _________ ratios measure the degree to which a firm relies on borrowed funds in its operations.
A. Retail earning
B. Earnings per share
C. Wholesale earning
E. Leverage (debt)
8. Mario is part of a strategic planning team. He has identified that his company is the low-cost producer in its industry. This should be listed on a SWOT analysis as/an
Strength
Threat
Opportunity
Weaknesses
9. Camden Products buys a $500,000 machine by taking out a bank loan. The company’s assets will ­­­­­­­­­­­­­______by $500,000 while its liabilities will________by $500,000.

Fall; fall
Fall; rise
Rise; rise
Rise; fall
11. Student A says that customer satisfaction is a mark of a world-class business. Student B says that proactive ethics is a mark of a world-class business. Student B says that proactive ethics is a mark of a world-class business. Which student is correct?
Neither
Both
Student A only
Student B only
12. All of the following are assets except
Bank loans
Cash
Inventory
Patents
14. Pham is employed as a human resource manager. His responsibilities might include all of the following activities except
Administering compensation plans.
Administering employee benefit programs.
Developing employees training programs.
Projecting sales for the coming six-month period.
15. Which of the following represents the basic accounting equation?
Assets + Liabilities = Owners’ Equity
Liabilities = Assets + Owners’ Equity
Assets = Liabilities + Owners’ Equity
Owners’ Equity-Liabilities = Assets
16. Forbes, Fortune, and similar types of magazines often contain ads for Rolex watches, BMW automobiles, and other luxury items. Advertisers are trying to reach a market segment based on
Location
Age
Gender
Income
17. The salesperson’s task of identifying potential customers is known as
Follow-up
Prospecting
Selection
Demonstration
18. The method of determining the minimum sales volume needed at a certain price level to cover all costs is
Market share analysis
Return on sales
Equilibrium pricing
Breakeven analysis
19. Ida works on creating ways to ensure that customers receive goods at the right time and correct location. Ida is involved in her firm’s_________strategy.
Product
Promotion
Pricing
Transportation
20. Nearly a week before Hurricane Katrina reached New Orleans, Wal-Mart began moving trucks and supplies into position, as specified in the company, s_________plan.
Tactical
Operational
Strategic
Contingency
21. The rate the Fed charges member banks for short-term loans is called the
Reserve requirement
Margin rate
Discount rate
Federal funds rate
22. During a recession, unemployment_________while inflation
Rises; falls
Falls; falls
Rises; rises
Falls; rises
23. If a firm has a current ratio of 2.00, it means that for every $2 in_________it has $1 in
Total assets; total liabilities
Current assets; current liabilities
Total assets; current liabilities
Current assets; total liabilities
24. Omar, an electrician for Quality Builders, is paid $35 for each hour he works during the day. After 5p.m. and on weekends, he is paid the overtime rate of one and one-half times the regular hourly rate. Omar is paid a
Commission
Salary
Wage
Bonus
25. Union workers at an auto parts plant go out on strike. In response, management closes the plan. This tactic is a
Cooling-off period
Secondary boycott
Lockout
Strikebreaker
26. In the U.S. economy, ________are considered the reward for the risk of entering business.
Sales
Revenues
Profits
Liabilities
27. According to the doctrine of supply, the amount_________will increase as the________increases.
Sold; demand
Supplied; price
Demanded; cheapness
Bought; cost
28. The Social Club is conducting a breakeven analysis to determine how many tickets it must sell at $15 each to break even on the Holiday Dance. Fixed costs are $2,000, and the variable cost per person is $10. To break even, the Social Club must sell_________tickets.
80
800
400
500
29. Price auctions on eBay are an example of
Entertainment
Information
Communication
E-business
30.  In which stage of the product life cycle do sales reach a saturation level, making further sales expansion difficult?
Maturity stage
Growth stage
Decline stage
Introductory stage
31. In which stage of the product life cycle are profits at their highest?
Decline stage
Introductory stage
Maturity stage
Growth stage
32. A company includes an “instant coupon” as part of a product’s package, giving the buyer a reduction off the retail price. What is the company attempting to do?
Accentuate product value
Stabilize sales
Provide information
Increase sales
33. Suppose you want to price goods and services at price points that make the product appear less expensive than it is. Which strategy should you use?
Penetration
Skimming
Competitive
Psychological