BUS 201 Comprehensive Exam Review

A business is an organization that seeks to​ ______ by providing​ ______.

earn profit; goods and services

Profit is what remains after a​ business's ______ have been subtracted from its​ ______.

expenses; revenue

Profit is important to business owners because​ _______________.

it provides motivation for risking time and money

The way in which a nation allocates its resources among its citizens is determined by its​ _______________.

economic system

​A(n) ______ is an individual who accepts the opportunities and risks involved in creating and operating businesses.

entrepreneur

Both​ ______ and​ ______ are considered command economies.

socialism; communism

In a​ _____ economy, B2B and B2C exchanges take place without much government involvement.

market

_______ are people hired by a company or industry to represent that​ company's interests with government officials.

lobbyists

Total government expenditures in 2013 were​ $235.3 billion. This exemplifies which role of the government in the Canadian​ economy?

customer

Which of the following is designed to promote healthy competition among business firms in​ Canada?

the Competition Act

The Food and Drugs Act is an example of a piece of legislation that​ ______.

protects consumers

​______ are taxes that cause poorer people to pay a higher percentage of income than richer people do.

regressive revenue taxes

Sales taxes are an example of​ ___________.

regressive revenue taxes

​______ is a mechanism for exchange between buyers and sellers.

a market

The​ ______ is the principle that buyers will purchase more of a product as its price drops.

law of demand

The equilibrium price is also called the​ ______.

market price

Market equilibrium is determined by the​ _________.

intersection of the demand curve and the supply curve

The situation is which quantity supplied exceeds quantity demanded in a market is described as​ ________.

surplus

An economic system characterized by private property​ rights, freedom of​ choice, profits, and competition is best described as​ __________________.

private enterprise

One characteristic of​ ___________ is that the going price is set exclusively by supply and demand and is accepted by both seller and buyer.

perfect competition

A market or industry characterized by a small number of very large firms that avoid direct price competition is described as​ _______________.

an oligopoly

Canadian agriculture provides a good example of an industry in which there exists​ ________.

perfect competition

​Fast-food restaurants in Canada compete under which kind of competitive​ conditions?

monopolistic competition

In​ Canada, laws such as the Competition Act forbid​ ______________.

monopolies

During the 10 years after it was made a Crown​ corporation, Canada Post raised rates by 41 percent. This behaviour suggests that Canada Post was acting as​ a(n) _________.

monopoly

The​ ______ is everything outside an​ organization's boundaries that might affect it.

external environment

An organizational boundary​ _____________.

separates the organization from its environment

The​ _____ environment includes economic​ conditions, technology, political-legal ​considerations, social​ issues, the global​ environment, issues of ethical and social​ responsibility, the business environment​ itself, and emerging challenges and opportunities.

external

A(n) ______ is the pattern of​ short-term ups and downs in an economy.

business cycle

When the economy experiences two or more consecutive quarters of decline in GDP we call this​ a _______________.

recession

The​ ______ is the total quantity and quality of goods and services that a​ country's citizens can purchase with the currency used in its economic system.

standard of living

​__________ refers to the total quantity of goods and services produced by an economic system during a given period.

aggregate output

The​ ______ is the total of a​ country's exports minus its imports.

balance of trade

A​ country's ______ is the amount of money the government owes its creditors.

national debt

Inflation in Canada is measured by the​ _______________.

consumer price index

​_____________ involves finding ways to use technological innovations to create new products or services that can be sold in the marketplace.

applied R&D

______ is the process of getting a new technology out of the lab and into the marketplace.

technology transfer

Although many people associate technology with​ ______. it is also a significant factor in the​ ______ sector.

manufacturing; service

Laws and regulations imposed on business by the government are part of the​ ____________ environment of business.

political-legal

Although Canada is a​ ________ economy, there is still significant government regulation of business activities.

free market

What is particularly important for multinational​ firms?

political stability

When​ McDonald's responds to concerns about nutrition and health by adding salads to its​ menu, they are pursuing opportunities in the​ ____________ environment.

socio-cultural

The​ __________ environment includes the​ customs, values,​ attitudes, and demographic characteristics of the society in which a company operates.

socio-cultural

Consumer tastes and preferences are part of the​ _______________.

socio-cultural environment

When someone purchases a train ticket instead of an airplane ticket to take a trip between two​ cities, this reflects​ ______ according to​ Porter's five forces model.

the threat of substitute products

Intense price competition or elaborate advertising campaigns are examples of concerns addressed in which part of​ Porter's five forces​ model?

the rivalry between existing competitors

​_________ is the strategy of paying suppliers and distributors to perform certain business processes or to provide needed materials or services.

outsourcing

A strategy of using the internet and​ word-of-mouth marketing to spread product information is called​ ________________.

viral marketing

__________ means moving away from organizing around departments and moving toward organizing around​ process-oriented team structures that cut across old departmental boundaries.

business process management

When two companies combine to form a single larger​ business, this is called​ a ____________.

merger

​__________ is when a company purchases and absorbs another company.

acquisition

A​ _____________ involves two or more enterprises temporarily cooperating in the​ research, development,​ manufacture, or marketing of a product.

strategic alliance

______ are beliefs about what is right and​ wrong, or good and bad.

ethics

______ vary from person to​ person, from situation to​ situation, and from culture to culture.

ethics

Ethical and unethical behaviours are determined​ _________.

partly by the individual and partly by the culture

​__________ is a term often used to refer to ethical or unethical behaviours by a manager or an employee of a business.

business ethics

Corporate social responsibility refers to the way in which a business tries to balance its commitments to​ __________.

organizational stakeholders

_______ social responsibility refers to the way in which a business tries to balance its commitments to all organizational stakeholders.

corporate

A movement designed to help workers in developing countries receive fair payment for their work is called​ ___________.

fair trade

​______ is the view that a​ company's only social responsibility is to make as much money as possible for its​ shareholders, as long as it​ doesn't break any laws.

managerial capitalism

When companies get together to​ "fix" prices for their own​ advantage, it is called​ ___________.

collusion

A measure developed to help companies​ understand, manage, and communicate the social value of their activities for stakeholders is​ __________.

social return on investment (SROI)

A ______ is an employee who discovers and tries to put an end to a​ company's unethical,​ illegal, or socially irresponsible actions by publicizing them.

whistle-blower

​______ is the use of confidential information to gain from the purchase or sale of stock.

insider trading

A company with​ a(n) __________ stance to social responsibility meets all its legal and ethical​ requirements, and in some cases even goes beyond what is required.

accommodative

A company with​ a __________ stance to social responsibility actively seeks opportunities to be socially responsible.

proactive

A company with​ a __________ stance to social responsibility will do everything required of it​ legally, but nothing more.

defensive

A company with​ an __________ stance to social responsibility will do as little as possible to solve social or environmental problems.

obstructionist

In​ general, ethical and social responsibility issues impacting small business and larger companies differ mostly in​ ___________.

scale

Small business owners face many specific​ _______ that have an immediate​ (and perhaps​ profound) effect on their business.

ethical dilemmas

Mean Manufacturing has been cited for not filing the proper paperwork and for polluting beyond the acceptable regulatory limits.​ Jim, the plant manager of Mean​ Manufacturing, is looking for ways to alter the paperwork so it will look like less pollution is emitted and the company will not receive any further fines. Jim has taken which stance toward social​ responsibility?

obstructionist stance

​A ______ is an​ owner-managed business that does not dominate its​ market, while​ a ______ is a recently formed commercial organization that provides goods​ and/or services for sale.

small business; new venture

________ are people who recognize and seize opportunities and accept the risks associated with creating and operating a new business venture.

entrepreneurs

​______ is the process of identifying an opportunity in the marketplace and accessing the resources needed to capitalize on that opportunity.

entrepreneurship

People who exhibit entrepreneurial characteristics and create something new within an existing firm are called​ _____________.

intrapreneurs

It may surprise you to learn that 97.9 percent of all businesses in Canada are considered​ _________.

small businesses

A local dress shop with three employees is considered a ____________.

small business

Small businesses are defined as those with less than ____ employees.

100

Most new venture ideas come from​ ______.

events relating to work or everyday life

​A(n) ______ is an estimate of how much of a product or a service will be purchased by the prospective customers for a specific period of time.

sales forecast

​A(n) ______ is an arrangement that gives the buyer the right to sell the product of the seller​ (owner).

franchise

​______ is a financing technique whereby entrepreneurs make do with as few resources as possible and use other​ people's resources wherever they can.

bootstrapping

One benefit to buying an existing business is that​ _____.

the odds of success are better

Experts recommend buying an existing business because​ _________________.

it has established relationships with suppliers, it has a proven ability to attract customers, the odds of success are better, and potential buyers have a much clearer picture of what to expect

Sameer is considering buying a franchise. One disadvantage he should be aware of is​ _________.

there is little room to develop your own ideas

_________ does not explain why small businesses succeed.

lack of control

_________ does not explain why small businesses fail.

access to resources

Four basic factors explain most small business​ success: hard​ work, __________, managerial​ competence, and​ ___________.

market demand; luck

Four factors contribute to small business​ failure: __________,​ neglect, weak control​ systems, and​ ___________.

inexperience; insufficient capital

A major disadvantage of sole proprietorship is​ ______.

unlimited liability

General partners have​ ________, while limited partners have​ ________.

unlimited liability; limited liability

As​ partners, Kabir is​ a(n) ________ because he is actively involved in the​ day-to-day operation of the​ business, while Julia is​ a(n) _________ because she is just an investor.

general partner; limited partner

​A ______ is a business whose shares of stock are held by only a few shareholders and are not widely available for purchase.

private corporation

​A ______ is a business whose shares of stock are widely held and available for sale to the general public.

public corporation

​______ is the process by which the world economy is becoming a single interdependent system.

globalization

Products that have been made or grown in another country but which are sold and used in Canada are called​ _________________________.

imports

Products that have been made or grown in in Canada but are shipped and sold abroad are called​ ___________________.

exports

The three key geographic regions with most of the​ world's largest​ economies, biggest​ corporations, influential financial​ markets, and​ highest-income consumers are​ ___________, ____________, and​ _____________.

North America; Europe; Pacific Asia

The BRICS group of nations are becoming increasingly important in international business because​ _____________.

of economic growth and potential for consumer demand

The term BRIC denotes a group of four nations that are increasingly important in global​ trade:

Brazil, Russia, India, China

Which of the BRIC nations has become one of the​ world's leading suppliers of sources of energy to other​ nations?

Russia

​______ competitiveness is the ability of a country to generate more wealth than its competitors in world markets.

international

The ability to produce some products more efficiently than others is called​ ________________.

comparative

Canada has a comparative advantage in​ ___________.

farming

The ability to produce something more efficiently than any other country is called​ _____________.

absolute advantage

Saudi​ oil, Brazilian coffee​ beans, and Canadian timber are close examples of a country having​ an _______________.

absolute advantage

If a country has a trade​ surplus, it means that it has​ ______.

favourable balance of trade

When the value of a​ country's imports exceeds the value of its​ exports, it is said to have​ ___________.

a trade deficit

The​ ______ rate is the rate at which the currency of one nation can be exchanged for that of another.

exchange

When a country can produce something that is cheaper or of higher quality than any other country it has​ an ____________ advantage.

absolute

​An ______ is a foreign individual or organization that agrees to represent an​ exporter's interests in foreign markets.

independent agent

When a company gives an individual in a foreign country the exclusive right to manufacture or market their products in that area in return for a royalty payment it is called​ _____________.

a licensing arrangement

BFL​ Canada, of​ Montreal, is​ Canada's largest privately owned and operated commercial insurance broker. To increase its​ sales, the company formed​ a ______ with an American insurance​ broker, Lockton Companies LLC of Kansas​ City, Missouri, whereby each company could provide greater coverage for its clients and yet remain an independent company.

strategic alliance

A ______ involves buying or establishing tangible assets in another country.

foreign direct investment

The first question to ask when deciding whether to​ "go international" should be​ __________.

​"Is there international demand for the​ product?"

A ______ is a restriction by one nation on the total number of products of a certain type that can be imported from another​ nation, while​ a) ______ is a government order forbidding exportation​ and/or importation of a particular productor even all products of a particular country.

quota; embargo

​______ require that products sold in a particular country be at least partly made in that country.

local content laws

Challenges to doing business internationally because of language​ barriers, different beliefs about what is considered​ ethical, or unfamiliar local traditions are examples of​ ___________.

social and cultural differences

What was designed to eliminate trade barriers by encouraging nations to protect domestic industries within​ agreed-upon limits and to engage in multilateral​ negotiations?

The General Agreement on Tariffs and Trade​ (GATT)

The organization through which member nations negotiate trading agreements and resolve disputes about trade policies and practices is called​ ________________.

the World Trade Organization (WTO)

The largest free marketplace in the​ world, which produces nearly​ one-quarter of the total global​ wealth, is​ ________________.

the European Union (EU)

​______ is the process of​ planning, organizing,​ leading, and controlling an​ enterprise's financial,​ physical, human, and information resources to achieve the​ organization's goals.

management

​______ is achieving the greatest level of output with a given amount of​ input, while​ ______ is achieving the organizational goals that have been set.

efficiency; effectiveness

______ is the process of determining the​ firm's goals and developing a strategy for achieving them.

planning

​______ is the process of monitoring a​ firm's performance and making adjustments to make sure it is meeting its goals.

controlling

​______ involves mobilizing the resources required to complete a particular task.

organizing

​______ are those managers responsible for a​ firm's overall performance and effectiveness and for developing​ long-range plans for the company.

top managers

______ managers are responsible for the production systems that create goods and services.

operations

​______ managers hire​ employees, train​ them, evaluate their​ performance, decide how they should be​ compensated, and deal with labour unions.

human resource

​______ managers are responsible for designing and implementing various systems to​ gather, process, and disseminate information.

information

​______ involves the interactions between managers and their subordinates as they both work to meet the​ firm's objectives.

leading

Top managers depend most on​ _____ skills, while​ ______ skills are important at all levels of management.

conceptual; human relations

The leading causes of wasted time at work include _____________.

paperwork, the telephone, email, and meetings

​_______ help managers define problems or opportunities and select the best course of action.

decision-making skills

In​ 2007, QTL​ Inc., a biomedical company based in​ Vancouver, was trying to maximize shareholder value. It was considering a number of​ options, including selling parts of the company. The stage that best describes the stage of decision making of the company is​ ______.

evaluating alternatives

The ability to think in the​ abstract, diagnose and analyze various​ situations, and see beyond the present situation require managers to develop​ ___________.

conceptual skills

​_________ refer to the actions that people take as they try to get what they want.

organizational politics

When a manager makes a decision and remains committed to its implementation in spite of clear evidence that it was a bad​ decision, ____________ has occurred.

escalation of commitment

​______ is/are​ shorter-range plan(s) concerned with implementing specific aspects of the​ company's ______.

tactical plans; strategic plans

​______ are plans setting​ short-term targets for​ daily, weekly, or monthly performance.

operational plans

A​ ______ is a statement of how a company will achieve its purpose.

mission statement

___________ is used to identify and analyze organizational strengths and weaknesses and environmental opportunities and threats as part of strategy formulation.

SWOT analysis

​______ is a​ long-term goal derived directly from the​ firm's mission statement.

a strategic goal