Quiz Review 7' Business - Introduction To Business

A producer that mines coal is a(n) ________

Name and describe the three types of innovation

Describe the advantages of turnkey projects as a mode of entry into a foreign market.

The know-how required to assemble and run a technologically complex process, such as refining petroleum or steel, is a valuable asset. Turnkey projects are a way of earning great economic returns from that asset. The strategy is particularly useful where FDI is limited by host-government regulations. For example, the governments of many oil-rich countries have set out to build their own petroleum-refining industries, so they restrict FDI in their oil-refining sectors. But because many of these countries lack petroleum-refining technology, they gain it by entering into turnkey projects with foreign firms that have the technology. Such deals are often attractive to the selling firm because without them, they would have no way to earn a return on their valuable know-how in that country. A turnkey strategy can also be less risky than conventional FDI. In a country with unstable political and economic environments, a longer-term investment might expose the firm to unacceptable political and/or economic risks (e.g., the risk of nationalization or of economic collapse).

4

All of the following are stages in the product life cycle EXCEPT ________

5

A pegged exchange rate means the value of the currency is fixed relative to a reference currency, and then the exchange rate between that currency and other currencies is determined by the reference currency exchange rate

6

When does a state of certainty exist in a decision-making process?

7

Ria owns 500 shares of stock in the Megabux Corporation. She is pleased to learn that the company earned a very nice profit over the most recent operating period. The company has announced that it will pay each shareholder a dividend of $1 per share out of its after-tax profits. Because Megabux has already paid taxes on this profit, this payment will represent tax-free income for Ria

8

A growing number of companies are organizing their workforces into teams.

9

Online banks offer customers better interest rates and lower fees because these businesses avoid the costs of constructing and maintaining a bank building.

10

People who report illegal or unethical behavior are called whistleblowers.

11

Which of the following, if true, suggests that Staples' efforts at remaking its stores would NOT have the desired effect?

Answer: A
Explanation: A) If the people who care most about having an easier shopping experience are less likely to shop in stores, Choice A, then Staples' efforts would be less likely to affect them. In that case, Staples' efforts would tend to miss the people who would benefit from them, which would be a reason not to go with the store redesign plan. Choice B: Staples' service before the recent efforts is one step removed from this issue. Also, technically, Choice B only says that the service was not "close to industry norms." This could mean that service was worse, but it might have been better. So, at best, Choice B is ambiguous. Choice C doesn't tell us what Staples will do here or what effect it might have. Choice D supports the argument by suggesting that customers who care about service would reward Staples for an easier experience. Choice E: Restaurants are outside the scope of this argument.

12

Companies such as ExxonMobil and Mitsubishi operate on a worldwide scale without ties to any single country. These are examples of

13

When Iris was trained for her new job, she was asked to respond to questions on a computerized multiple-choice test. Iris' company used the apprentice training approach

14

The majority of cross-border investment in the developed world is in the form of _____.

15

Which of the following described a part of the promotion mix that is a paid nonpersonal message communicated to a select audience through a mass medium?

16

The choice of a particular location for production facilities

17

Safety needs are placed at the lowest level in Maslow's hierarchy of needs.

18

Electronica Inc. is a mobile-phone retailer that sells smartphones to high school students at easily affordable prices. The company has one marketing strategy for the entire market of high school students and focuses all its efforts on this one segment. In this scenario, Electronica Inc. is most likely using the ________ approach for marketing its smartphones.

19

The first step in the selling process is ________

20

At the end of a program broadcast on PBS about rescuing marine wildlife, the credits read: "Major funding for this program was provided by Procter & Gamble, the makers of Dawn Dishwashing Soap." Which form of public relations does this best illustrate?

21

Some economists would say that intermediaries add costs to the channel of distribution and need to be eliminated.

22

All of the following are common methods of obtaining information about applicants except

23

In the context of foreign direct investment, a joint venture involves the merger of companies.

24

What is an initial public offering (IPO), and what are the basic steps involved in this process?

Many corporations are initially owned by only a handful of people who don't actively
trade the stock to outsiders. But rapidly growing corporations often need to obtain
more financial capital than such a small group can provide. Such firms may decide to
go public by issuing additional stock and offering it to the general public. The first
time a corporation sells its stock in a public offering, the sale is called an initial public
offering, or IPO. The process typically involves four steps:
Selecting an investment bank: Many firms that go public enlist the help of a
financial intermediary known as an investment bank. The investment bank assists
the firm at every step of the IPO, from the planning and market assessment until the
day of the actual offering. Determining how to structure the offer is a key role of the
investment bank.
Preparing the IPO paperwork: Before going public, a firm must file a registration
statement with the Securities and Exchange Commission (SEC). This statement
provides a detailed description of both the firm and the securities, including the firm's
key financial statements plus additional financial information. The investment bank
usually helps prepare this long, complex document. The firm later includes much of
the information from the registration statement in its prospectus, which the firm must
give to all investors who are interested in purchasing the securities.
Arranging for financing: One of the key responsibilities of the investment bank is to
arrange for the actual sale of the securities. The investment bank typically uses either
a best efforts or a firm-commitment approach. Under a best efforts agreement, the
investment bank provides advice about pricing and marketing and assists in finding
potential buyers. But it doesn't guarantee that the firm will sell all of its securities at a
high enough price to meet its financial goals. Under a firm-commitment arrangement,
the investment bank underwrites the issue. This means that the investment bank
itself purchases all of the shares, which guarantees that the firm issuing the stock will
receive a known amount of new funds directly from the investment bank. The
investment bank makes its profit by reselling the stock to investors at a higher price.
Carrying out the offer: On the day of the actual IPO, the investment bank normally
takes charge, handling all of the details to ensure that investors receive their securities
and copies of the final prospectus, and the firm receives its funding.

25

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

26

International trade provides businesses with access to new customers through:

27

Consumers often spend a great deal of time and money doing research to purchase a specific service. These consumer products are referred to as

28

The term_______ refers to government efforts to influence the economy through taxation and spending decisions that are designed to encourage growth, boost employment, and curb inflation.

29

When you have to enter data on a mobile device, using ________ in public areas or shared offices can expose private message content and annoy anyone within earshot

30

Advertising is personal communication designed to influence consumer purchases

31

The foreign exchange trading center in ________ has the highest percentage of activity.

32

Camila manages a used car dealership that allows customers to buy cars for no money down and pay in installments throughout the year. Her company builds in a bad-debts adjustment that is deducted from the accounts receivable balance to present a more realistic view of the payments likely to be received in the future for these cars. The payments the company expects to receive are called

33

A small business is all of the following except

34

What is the primary reason that so many new businesses fail?

35

Which of the following is an advantage to focusing on conclusions and recommendations in an analytical report?

36

A line of credit from a bank guarantees a firm that a specified amount of financing will be available when it is needed.

37

The interest rate that the Federal Reserve System charges for loans to member banks is called the:

38

In the text of a report, only the most important visuals should be referred to by number

39

Conflict can be a constructive part of teamwork

40

The purpose of a division of labor and specialization is to improve an employee's job performance.

41

What are the key differences between common and preferred stock?

Common stock represents the basic ownership in a corporation. Owners of common
stock usually have voting rights; they have the right to receive a dividend if the
corporation's board declares one; they have preemptive rights, which allow current
stockholders to purchase new stock issued by the company in proportion to their
existing holdings before it is offered to the general public; and they have the right to
residual claims on assets if a corporation goes out of business and liquidates its assets.
However, in a residual claim: common stockholders can claim a right to share in the
proceeds of the sale of a bankrupt firm's assets only after all other claims, such as
back taxes and legal fees, have been satisfied.
Preferred stock is a type of stock that gives its holders preference over common
stockholders in two main ways. Owners of preferred stock are more likely to receive
a dividend than are common stockholders. They also have a preferred claim on assets
that comes before the claim of common stockholders should the company go
bankrupt. Most preferred stock includes a cumulative feature. This means that when
the firm skips a preferred dividend in one quarter, the amount it must pay the next
quarter is equal to the dividend for that quarter plus the amount of the dividend it
skipped in the previous quarter. Any additional skipped dividends continue to
accumulate. The firm can't pay any dividends to common stockholders until it has
paid preferred stockholders all of the accumulated dividends it owes them. This
provision is one of the reasons the board has a strong incentive to make regular
dividend payments to preferred stockholders.
Preferred stock isn't necessarily preferred to common stock in all respects. For
example, preferred stockholders normally don't have voting rights, so they can't vote
on issues that come up during stockholders meetings. And while preferred
stockholders are more likely to receive a dividend, the overall return for common
stockholders (including the capital gain) is often higher.

42

All U.S. companies are bound by the Foreign Corrupt Practices Act

43

The collapse of the fixed exchange rate system has been traced to the

44

You can negotiate a win-win situation by offering to manage an established small business. You win from the experience; the owner wins with free time.