When economists study the national economy or global economy, they are using a(n) ____________ approach.
The work performed to produce goods and services is referred to as
2) financial resources.
3) material resources.
4) capital goods.
Fluctuations in a nation’s economy are referred to as its
1) economic upheaval.
2) inflation problem.
3) depression cycle.
4) business cycle.
5) recession period.
The United States, whose economy exhibits elements of both capitalism and socialism, has what is known as a(n) _____________ economy.
As computers gained popularity, the ________________ typewriters decreased along with the price.
1) demand for
2) supply of
3) equilibrium of
4) productivity of
5) monopoly associated with
Which of the following companies is an example of a manufacturer?
1) Best Buy
5) H&R Block
The study of an individual’s economic decisions would be an example of
3) fiscal policy.
4) monetary policy.
5) national economic policy.
At the end of the year, an individual, small business owner has made $65,000 in profit. Who does that profit belong to?
1) The company’s CEO and top managers
2) The banks from which the business borrowed money
3) All employees of the small business
4) The consumers of the business’ products
5) The owner of the business
The owner of the business
Perfect competition is characterized by
1) many buyers and many sellers.
2) few buyers and few sellers.
3) few buyers and many sellers.
4) many buyers and few sellers.
5) a few companies that control the market.
Many buyers and many sellers
A system where the basic economic questions are determined, at least to some degree, through centralized government planning is referred to as a economy.
Randall Newman distributes rawhide to several different homes. In turn, each household produces a product such as satchels, belts, shoes, and boots, and then Randall sells the finished goods. This represents a(n)
2) domestic system.
3) system of specialization.
4) factory system.
5) barter system.
__________________ resources include the funds needed to pay wages, purchase raw materials, and operate a business.
For a Pepperidge Farm production facility, managers and employees would be
1) natural resources.
3) information resources.
5) the entrepreneurial resource.
A natural resource, as recognized by economists, would include which of the following?
1) Crude oil
For a business, stakeholders represent
1) investors in the business.
2) lenders that have provided loans.
3) suppliers that have extended credit to the firm in search of profit for the firm.
4) employees who work for the firm.
5) all of the different people or groups who are affected by the business.
all of the different people or groups who are affected by the business.
The economic term used to describe the Federal Reserve’s actions to determine the size of the supply of money in the nation and the level of interest rates is
1) monetary policy.
2) fiscal policy.
3) debt policy.
4) recovery technique.
5) recovery guideline.
Olan Okowo recently moved to the United States with many hopes and dreams. However, he realizes that economic freedom includes all of the following except the right to
1) guaranteed economic success.
2) use owned resources to produce a profit.
3) accept or reject any job offered.
4) sell a product at the price chosen.
5) buy any economic good or service producers sell.
guaranteed economic success.
Researchers just released the results of a study that shows eating fish at least four times a week dramatically decreases adults’ risk of heart disease. What will likely result from this new information?
1) The demand for fish will decrease.
2) The supply of fish will decrease, causing a decrease in the price.
3) The demand for fish will increase at every price.
4) The demand for fish will decrease at every price.
5) The demand for fish will likely remain the same, but the market price will adjust.
The demand for fish will increase at every price.
If all leading corporations in the soft-drink industry merged, this would
1) encourage pure competition.
2) encourage monopolistic competition.
3) lead to an oligopoly.
4) create a limited monopoly.
5) create a monopoly.
Create a monopoly
The organized effort of individuals to produce and sell, for a profit, the goods and services that satisfy society’s needs is called
2) the economy.
5) the workplace.
In the mid-1970s, American auto manufacturers produced big gas-guzzling cars and tried to sell them to consumers who needed fuel-efficient transportation. This happened because manufacturers
1) lost sight of consumers’ needs.
2) attempted to satisfy consumers’ needs.
3) followed consumers’ wants too closely.
4) knew the economy would rise again.
5) did not expect a profit.
lost sight of consumers’ needs.
Matt Newell, a former Air Force pilot, decides to operate a helicopter tour company to provide customers with breathtaking views of the Rocky Mountains. He obtains a loan and purchases the necessary land, facilities, advertising, and five helicopters for his business. What important factor of production has he overlooked in creating his business?
5) Natural resources
2) ethical only under certain circumstances.
3) uncommon in many foreign countries.
4) economic returns.
The ________________ factor affecting ethical behavior includes one’s moral values and central attitudes.
Suppose a manager at the Rolodex Corporation has recently become aware that employees are taking office supplies home and taking longer coffee and lunch breaks than the personnel policy allows. The manager finds these are widespread practices and wants to solve the problem. The best way to do this would be to
1) call the police and arrest both the “time” thieves and the office supplies thieves.
2) fire all those who have taken office supplies, and suspend those who have taken too much time.
3) change the code of ethics in the personnel policy manual to prohibit these practices.
4) make the corporate culture encourage more ethical behavior.
5) let the union know about the problem during next year’s pay negotiations.
make the corporate culture encourage more ethical behavior.
When medical research indicated that a high-fiber diet might help reduce one’s risk of colon cancer, a few producers of fiber cereals suggested in their advertisements that if you eat fiber cereal, you will not get cancer. This is an example of
1) an unethical organizational relationship.
2) a conflict of interest.
3) social responsibility.
4) unethical communications.
5) ethical persuasion.
If a company deals with violations of its ethical codes ________________________, the opportunity to be unethical will be reduced.
1) leisurely and lightly
2) firmly and consistently
3) on a case-by-case basis
4) quietly and erratically
5) frequently and severely
firmly and consistantly
1) is laws and regulations that govern business.
2) is the application of moral standards to business situations.
3) do not vary from one person to another.
4) is most important for advertising agencies.
5) is well-defined rules for appropriate business behavior.
is the application of moral standards to business situations.
The manager of a large chain recently spoke to a group of college students about making it in the business world.
He focused particularly on the importance of fulfilling the purpose of the business organization: that is, to produce and market profitable products needed by society. In so doing, he indicated that a stockholder, not the society as a whole, invests in a corporation to earn a return on his or her investment and that a firm is legally obligated to act in stockholders’ interests. What concept do the manager’s comments reveal
1) Socioeconomic model of social responsibility
2) Economic model of social responsibility
3) Strictest model of social responsibility
5) Rights of employees
Economic model of social responsibility
The Audi 5000S was investigated because of reported instances of unintended acceleration. The investigating body concluded that the acceleration was not a result of a system malfunction but was due instead to driver error. However, they also said that the awkward placement of the brake and accelerator pedals was the primary contributor to these driver errors. By designing this part of the 5000S in an ergonomically inefficient manner, Audi ignored which of the four basic rights of consumers?
1) The right to be informed
2) The right to choose
3) The right to safety
4) The right to be heard
5) The right to comfort
The right to safety
MasterCard sends a customer a memo that discloses the true cost of borrowing with each billing statement. It does this because it realizes that the customer has the right to
2) obtain credit.
3) be heard.
4) be informed.
Residents around Lake Gunter have been warned not to drink their water because it contains some unknown chemical contaminant that could be harmful. What is this called?
5) Biological disaster
Dorothy worked at a meat packing plant during the 1920s. What would she have been most surprised to see happening at the plant?
1) Employees earning vacation time
2) Horrible working conditions
3) The organization of labor unions
4) Frequent accidents resulting in injury and death
5) Employees working long hours
Employees earning vacation time
A whistle-blower is a person who
1) announces the beginning and end of a work shift.
2) praises his or her own accomplishments.
3) does public relations work for a company.
4) accepts responsibility when a company is in trouble with the government.
5) reports illegal or unethical conduct within his or her organization.
reports illegal or unethical conduct within his or her organization.
Ed works in a position where there is very little supervision. In fact, although he considers himself ethical, he figures he could go away for a week without anyone noticing. Which general set of factors is most likely to influence Ed’s ethical behavior?
The manager of a successful local restaurant believes his responsibilities are to provide delicious meals and excellent service, provide jobs, comply with laws and the IRS, and earn a respectable profit on the restaurant. These are the manager’s only concerns. What concept does this indicate?
2) The economic model of social responsibility
3) The socioeconomic model of social responsibility
4) Consumer protectionism
5) A lack of social responsibility
The economic model of social responsibility
You are the decision maker for purchasing office equipment in your organization. One sales representative privately offers you season tickets to the Chicago Bears if you help him out. This tactic is
1) a corporate discount.
2) a common business practice.
3) a bribe.
4) personal selling.
The human resources manager at Swingline, Inc., a manufacturer of office staplers, wants to encourage a more ethical climate in the organization. A likely way for Swingline to do this is to
1) make certain that Swingline has a company code of ethics that is enforced.
2) add an ethics department whose job is to constantly watch employees to be certain they behave.
3) develop a system of security cameras, telephone monitoring, and one-way mirrors to be certain that employees behave appropriately.
4) avoid any mention of ethics to employees so that they will not think unethical thoughts.
5) do none of the above. All of these practices are illegal because they take away an employee’s constitutional right of free choice.
make certain that Swingline has a company code of ethics that is enforced
The United States bans Cuban cigars and other Cuban products from entering the United States due to political difficulties. This action is called a(n)
2) import quota.
3) trade ban.
4) foreign-exchange control.
5) import duty.
The United States wishes to import no more than 100 million tons of sugar from India in any given year. The type of import restriction it should impose is a(n)
1) import duty.
2) foreign exchange control.
3) import quota.
5) export duty.
Purchasing products or materials in other nations and bringing them into one’s own country is
When a business has plants located in several foreign countries without ties to any specific nation or region, it is called a(n)
1) multinational enterprise.
2) joint venture.
3) exporting business.
4) licensing firm.
5) none of the above.
_______________ is the ability to produce a specific product more efficiently than any other product.
1) Absolute advantage
3) Relative advantage
4) Dominant advantage
5) Comparative advantage
If Japan were regarded as the best electronics manufacturer in the world, what would be true?
1) Japan would have a comparative advantage in electronics manufacturing.
2) Japan would have a positive balance of trade.
3) The United States would have a comparative advantage in electronics.
4) Japan would have an absolute advantage in electronics production.
5) Japan would have a trade deficit with the United States.
Japan would have an absolute advantage in electronics production.
A limit on the amount of a particular good that may be brought into a country during a given period of time is called a(n)
1) import duty.
2) import deficit.
3) trade embargo.
4) import tariff.
5) import quota.
If Germany exports $100,000 of sauerkraut to Jamaica and purchases $100,000 of Blue Mountain coffee beans from Jamaica, Germany has
1) an overall favorable balance of trade.
2) an overall unfavorable balance of trade.
3) a favorable balance of trade with Jamaica.
4) neither a favorable nor an unfavorable balance of trade with Jamaica.
5) an unfavorable balance of trade with Jamaica.
neither a favorable nor an unfavorable balance of trade with Jamaica.
If the Land of Mercury had total exports of $150 billion and total imports of $234 billion, it had a ________________.
1) comparative advantage.
2) trade deficit.
3) balance of payments.
4) negative output.
5) positive balance of trade.
Buyers that purchase dresses in Europe or calculators in Taiwan and have them shipped back to the United States for resale are engaging in
Which of the following scenarios would not be considered international business?
1) A Chinese manufacturer sells toys to a large toy retailer in the United States
2) Intel sells its processors to a computer manufacturer in Korea.
3) A large jewelry store in England purchases its diamonds from DeBeers in South Africa.
4) A bearing manufacturer in South Carolina sells its parts to a Toyota plant in Kentucky.
5) French companies purchase crude oil from Saudi Arabia.
A bearing manufacturer in South Carolina sells its parts to a Toyota plant in Kentucky.
When a country exports more than it imports, it has a(n)
1) trade deficit.
2) favorable balance of trade.
3) unfavorable exchange rate.
4) unfavorable balance of trade.
5) unfavorable balance of payments.
favorable balance of trade.
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