In general, as price of a good or service increases, the quantity demanded:
decreases
________ is the relationship between the goods and services produced in a nation each year and workers, raw materials, and other inputs necessary to produce them.
Productivity
Which of the following market structures best describes the U.S. auto industry?
oligopoly
Benito worked as a manager at a grocery chain that recently experienced a number of layoffs due to an economic slow time. Benito's employment would be described as ________.
cyclical
If the market price is above the equilibrium price, ________.
a surplus will occur and prices and production will fall
Economists refer to a nation's ________ as an indicator of its economic health
unemployment rate
If the cost of producing a good or service increases, the supply curve will shift to the ________ and the price will ________.
left; rise
Individual and business decisions are ________ by economic conditions and, in turn, economic conditions are ________ by their decisions.
affected; affected
Before the patent expired on allergy medicine Claritin, pharmaceutical company Schering-Plough was able to set its own price in the marketplace. From which type of competition did the company benefit?
monopoly
Entrepreneurs have the most economic freedom in which type of economy?
capitalism
Assume that the number of people wanting to buy homes increases sharply in your local area. The price of homes will likely ________, which is an example of ________.
increase; demand-pull inflation
According to a supply curve, ________.
as prices rise, the quantity of a product that is supplied also rises
A demand curve will shift to the left if the ________.
buyers' incomes decrease
Companies such as Dell Computer adapt their Web sites to specific countries. These companies are following a(n) ________ strategy.
multidomestic
The ________ promotes trade by providing financial assistance and waiving debt payments.
International Monetary Fund
By allowing a company to purchase another existing firm in the host country, a(n) ________ permits a largely domestic business to gain an international presence very quickly.
acquisition
The United States has a trade surplus with which of the following items?
services
A country's exchange rate is based on ________.
the rate at which its currency can be exchanged for currencies of other countries
The objective of an import quota is to ________.
prevent dumping
All of the following constitute a country's infrastructure EXCEPT ________.
political climate
A foreign-made household appliance is popular and is highly competitive with the same product manufactured domestically. To give the domestic industry a better chance to operate profitably, the government restricts the number of these appliances that can
import quota
An absolute advantage occurs when a country can maintain ________.
a monopoly by being the lowest-cost producer of a good or service
Which country features the most multinational corporations?
United States
Many developing nations have lower per capita incomes than highly developed countries. This fact ________.
does not mean there is little opportunity for sales. Their sheer numbers may still represent significant and growing markets.
Goto, Inc. is trying to establish a supplier relationship with a parts manufacturer in a small Asian country. Filipe, the purchasing manager, is attempting to get to know the general manager and staff of the company to help finalize the agreement. Filipe
cultural barrier
In recent years, the value of the dollar relative to the euro has declined. What does this mean for European businesses exporting to the United States?
European countries are more likely to import U.S. goods or services.
Patents, trademarks, and intellectual property are important concerns in the ___________ environment.
legal
If a foreign company offers steel in the United States below the company's cost of production, the company might be accused of ________.
dumping
Los Angeles-based PMI Telecom purchases cell phones manufactured in Asia and sells them in the United States. PMI is engaging in the international business activity known as ________.
importing
The European Union (EU) ________.
wants to promote European citizenship as a complement to national citizenship
When firms develop products and marketing strategies that appeal to the customer tastes and buying habits of particular national markets, they are using a ________.
multidomestic strategy
All of the following are included in the top five nations the United States trades with EXCEPT ________.
Spain
During the past decade, the value of U.S. imports and exports has ________.
more than doubled
The stock of Old Germany Brewery is totally owned by the Prechter family. When the family elected to move from a sole proprietorship to a corporation, the greatest concern was ________.
double taxation
Richard, Sarah, and Trevor form a partnership because it offers the following advantage:
greater financial resources
Which type of business is least likely to be bought by large companies?
businesses that sell personalized services
In exchange for an ownership share, Benita's small business receives financing from a group of investors known as _____________,
venture capitalists
If business owners in a partnership wish to limit liability, they have the option to ________.
set up a limited partnership
Small businesses that provide ________ have experienced the greatest increase in new jobs.
Services
________ of small businesses are considered home-based businesses.
About 50 percent
Franchising offers all of the following advantages EXCEPT ________.
guaranteed level of profitability
The two principal parties in a franchising agreement are the ________.
franchiser and franchisee
All of the following organizations are regularly and directly involved in sponsoring business incubators EXCEPT ________.
the federal government
The board of directors usually includes some individuals who are not employed by the corporation. These people are referred to as ________.
outside directors
All of the following are contributions of small businesses EXCEPT:
They provide more job security than large corporations.
The ________ industry represents the greatest percentage of minority-owned businesses.
Service
United Airlines' purchase of Continental Airlines combines the resources and capabilities of both firms to create the world's largest airline. The newly formed company is an example of a _____________.
horizontal merger
Which government agency establishes standards for small businesses?
Small Business Administration
Small-business owners want to determine whether their companies meet the standards for small-business designation because
government agencies offer benefits designed to help small businesses compete with larger firms.
The ________ is most likely an example of public ownership.
city sewer system
When a government unit owns and operates an organization, the arrangement is known as ________.
public ownership
Assume that Microsoft decides to invest some of its excess cash by acquiring fellow Seattle-based Starbucks Coffee. This would be a ________.
conglomerate merger
Which of the following is an advantage of a home-based business?
lower costs
___________ has a long-standing and well-known record of encouraging intrapreneurship.
microsoft
What makes entrepreneurs unique is their overwhelming desire to ________.
make their business grow
Enrique wants to start a new business, but his bank will not lend him the money he needs. Enrique saw an advertisement sponsored by a business organization that provides financing for promising small companies. The organization sponsoring the advertisemen
venture capitalist
Which of the following demographic/economic trends has increased the opportunities for entrepreneurs?
aging population
Michael is a successful financial advisor looking to invest money directly into a new consulting business in return for equity in the company. Michael is an example of a(n) ________.
angel investor
Information technology can help entrepreneurs in all of the following ways EXCEPT:
ensure financial success.
Jada is opening her own bakery. Jada is an example of a(n) ________.
entrepreneur
All of the following are major advantages of buying an existing business over starting a new business EXCEPT:
product or service is not known in the marketplace.
Studies indicate that most entrepreneurs spend ______ on their new business.
more than 60 hours per week
Which of the following statements best describes how entrepreneurs view failure?
They view failure as a learning experience.
Elian wants to start a business. He takes a personality test and discovers he possesses a trait that may reduce the likelihood he will succeed. Which of the following is that trait?
low tolerance for risk
________ are pioneers of innovations that benefit humanity.
Social entrepreneurs
Entrepreneurs and small-business owners both have all of the following qualities EXCEPT:
growth of their company.
_____ are specific geographic areas designated for economic revitalization.
Enterprise zones
An overall idea for how to convert a business idea into a success is called ________.
Vision
Which of the following has contributed the LEAST to the boom in entrepreneurship?
the rise of service industries
Which of the following is an example of a country with a factor-driven economy with an average of over 10% of its adults starting or managing a new business?
Bangladesh
Paterno routinely bids on contracts even though most of the other bidders are extremely large firms. Paterno believes his company offers better service at lower prices. He is exhibiting which personality trait common in entrepreneurs?
self-confidence
A company removes a profitable product from the market because it may be dangerous. This company is demonstrating ________.
ethical behavior
When management considers social and economic issues in decision making, the company is practicing ________.
social responsibility
Which of the following statements is correct?
Ethical conflicts never arise in trying to serve the needs of separate constituents.
Setting ethical standards is easy.
Setting ethical standards is always clear-cut.
Doing what is right can sometimes be diffi
Doing what is right can sometimes be difficult. Social and ethical problems affect only a few companies.
________ are responsible for conducting employee training programs that help spot potential fraud and abuse within a firm.
Ethics compliance officers
Technology has ________ ethical issues.
expanded the range of
Sean avoids using his office computer for personal use, even though his company does not have a specific policy forbidding it. Sean is at the ________ stage of ethical development
conventional
Linda does not make personal long-distance phone calls at work because it will cost her employer money. Which stage of ethical development is Linda in?
conventional
Tanisha is a diabetes educator at a local clinic. Recently, she was offered a lavish trip by a sales representative who has been pushing the clinic to use his company's diabetes supplies. Tanisha declined the gift. Which ethical challenge did she face?
conflict of interest
Mica learns that her company is secretly dumping untreated waste into the city sewer systems, and she informs the local EPA office. All of the following describe Mica's ethical situation EXCEPT
She is showing loyalty.
Bob takes responsibility for an error made by his assistant on a project. Bob has shown ________.
integrity
Development of a corporate culture to support business ethics occurs on each of the following levels EXCEPT ethical ________.
success
Ethical __________ charges each employee personally to uphold the company's core values and be willing to base their actions on them.
leadership
When Target donates 5 percent of its federally taxable income to nonprofit groups, the company is highlighting its ________.
social responsibility
The ____________ of a coffee-growing company include its employees, customers, suppliers, and the community members where the company is located.
stakeholders
A strategy that promotes environmentally friendly products and production methods is called ________.
green marketing
During the Olympics, several Nike ads were aired that demonstrated the company's sponsorship of various events. Nike was using ________ to align their marketing efforts with charitable giving.
cause-related marketing
According to ________ standards, when a drug company purchases a television ad, the company is required to describe potential side effects of the drug, or at least provide a phone number or Web site address for additional information.
Food and Drug Administration (FDA)
All of the following are current social issues related to business's responsibilities to employees EXCEPT ________.
discrimination against workers over 40 years of age
All of the following groups are specifically identified by federal equal employment opportunity laws EXCEPT ________.
obese persons
Companies that adhere to high ethical standards ________.
often make better investments in the long run
Holding supply constant and decreasing demand will cause ________.
prices and production both to fall
Which of the following does not make up part of the national debt?
Taxes
The U.S. population is ________.
expanding too rapidly
Under communism, ________.
profits are not acceptable and the right to choose one's occupation is widely restricted
________ refers to the willingness and ability of buyers to purchase goods and services.
Demand
Unless it is regulated or only temporary, the market situation called ________ is prohibited in the United States through antitrust legislation.
monopoly
Kim graduated from college in May and is looking for a job. She is ________ unemployed.
frictionally
Florida Fixtures uses a computer system that controls the entire production function from designing products to ordering raw materials. What kind of production system is Florida Fixtures using?
Computer-integrated manufacturing
When Best Buy vendors ship merchandise directly to stores instead of distribution centers, the company is utilizing ________.
vendor-managed inventory
Which of the following are combined to result in mass production?
Mechanization, specialized labor, and standardization
________ is the use of people and machinery to convert materials into finished goods or services.
Production
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 ________.
income
A company's financial records are a source of ________ and ________ data for marketing researchers.
internal; primary
Devin obtains research data based on the number of unique visitors to his company's Web site, as well as tracking types of orders and amount of money spent. Devin is acquiring what type of research data?
Primary
Which of the following is an interpersonal determinant of consumer behavior?
Family influences
The era in marketing history characterized by the notion that the customer is always right is known as the ________ era.
marketing
All of the following are methods of segmenting the business market EXCEPT ________.
psychographics
Some products can be classified as either a business or a consumer product depending on ______.
who buys the product/service and why
Personal determinants in the buying decision include all of the following EXCEPT ________.
cultural experiences
Grocery stores use ________ to assess local preferences for products so that they can tailor the inventory of each store accordingly.
data mining
Approximately how much more does it cost to attract one new customer than to keep an existing one?
Five times as much
Maria is campaigning for city council and talks with prospective voters in her ward about their concerns. Maria is engaged in ________ marketing.
cause
Which of the following is NOT consistent with relationship marketing?
Focusing on attaining new customers, even at the expense of losing long-term ones
Joe is developing the marketing mix for his company's new line of power tools. A brand name, price, and distribution system have been decided. Now Joe is concentrating his efforts on developing the best advertising plan for the product line. The advertisi
promotional
Developing and maintaining long-term, cost-effective exchange relationships with individual customers, suppliers, employees, and other partners for mutual benefit characterizes ________.
relationship marketing
A convenience store offers ________ utility by being open 24 hours each day.
time
Subaru offers a version of its Outback called the L.L. Bean edition. This is an example of ________.
a cobranded product
________ refers to the actions of consumers directly involved in obtaining, consuming, and disposing of products and the decision processes that precede and follow these actions.
Consumer behavior
One of the most common forms of segmenting consumer markets uses characteristics such as age, income, household size, and/or ethnic group. This is known as ________ segmentation.
demographic
The era in marketing history characterized by the notion that a good product will sell itself is known as the ________ era.
production
Bailey seeks out cleaning products that are environmentally friendly and is willing to pay extra for a "green" brand. What is the main factor for Bailey's purchase?
Personal determinants
The Federated Credit Union, through its direct-mail promotion, encourages its members to write letters to members of Congress asking them to pass legislation favorable to credit unions. Such promotion is a form of ________ advertising.
advocacy
Dunkin' Donuts uses __________ advertising when it tells people that "hard-working" people prefer their coffee over the high-priced Starbucks.
comparative
Melissa is a marketing manager for the Small Business Network at American Express and regularly sends materials to various companies to participate in credit card promotions. Melissa is employing a ________ strategy.
Pushing
Chris is allowed to purchase a reasonably priced notebook computer for graduation. He sees one at Best Buy for $999.99 and calls his parents to assure them the computer costs "less than a thousand." Both Chris and Best Buy are using ________ to downplay t
odd pricing
Cocina Mas Fina, a restaurant, makes all its menu items from scratch and uses authentic Mexican herbs in its dishes. As a result of its focus on using specialty ingredients, prices are 75 percent higher than the competition's. Cocina Mas Fina knows ______
the higher the price, the better its perceived quality
___________ involves the use of innovative, low-cost marketing efforts to attract customer attention.
Guerrilla marketing
Pure Products is introducing a new paper coffee filter at a dramatically reduced cost. Pure Products expects that competitors will come out with similar products within a short period of time. Which pricing strategy will enable Pure Products to discourage
Penetration pricing
When a pharmaceutical company uses the phrase "ask your doctor" in its ads, the company is using a ________ strategy to appeal directly to the public instead of physicians alone.
pulling
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?
Increase sales
Texaco and Shell are located directly across the street from one another. Texaco lowers its price for regular unleaded by 5 cents, and Shell quickly follows suit. What pricing objective is Shell using?
Competitive pricing
In breakeven analysis, total cost is composed of ________.
total variable costs and total fixed costs
The buyer-seller communication in _________ occurs during a face-to-face meeting or via telephone, videoconference, or interactive computer link.
personal selling
Albertson's, a large national supermarket chain, bases its pricing strategy primarily on which objective?
Volume
Which of the following manufacturers and products would likely spend more on personal selling than on nonpersonal selling?
Boeing, 737 jetliners
T-shirts Unlimited is conducting a breakeven analysis on unbleached cotton tops. Fixed costs are $100,000 and the per-unit contribution to fixed costs is $20. To break even, the company must sell ________ units.
5,000
__________ involves a one-on-one presentation to a prospective buyer.
Personal selling
Mailing out samples is particularly useful in promoting ________.
new products
Salespeople determine if prospects have the financial ability and authority to buy through ________.
qualifying
Shannon sells furniture, and a couple in her store tells her they're impressed with a particular living room couch. Shannon should ________.
attempt to close the sale
The future attitudes of most prospects are affected by the first impression they form of the salesperson. Therefore, salespeople ________.
should carefully prepare their approach to potential customers
________ activities focus on providing valuable assets to a business.
Investing
Emilio is not an employee of the Modesto Corporation, but was hired as a management consultant to provide unbiased advice about Modesto's financial condition. Emilio is a(n) ________.
public accountant
Jackson, chief financial officer for a company, is interested in a summary of all the costs related to producing revenues for the most recent quarter. He can best find this information by consulting the ________ section of the ________.
expense; income statement
Ricardo is a loan officer for a bank and is reviewing the financial statements of a prospective borrower. As a user of accounting information, Ricardo is most interested in using this information ________.
to evaluate credit risk
Raphael works as a tax accountant at a mid-sized manufacturing company. Raphael would be considered a ________.
management accountant
If Topeka Enterprises has a debt ratio of 40 percent, it means that for every $1 in ________, the firm has 40 cents in ________.
assets; liabilities
Cash budgets are usually prepared ________.
Monthly
Samantha works for a mid-sized manufacturing company. Her responsibility is to examine the firm's financial practices to ensure that records include accurate data and that the firm's operations are in compliance with federal, state, and local laws and reg
internal auditor
All of the following are profitability ratios EXCEPT ________.
inventory turnover
The rules followed by accountants when preparing financial statements are referred to as ________.
Generally Accepted Accounting Practices (GAAP)
Which of the following statements is correct?
Budgets serve as a planning and control tool.
________ activities focus on selling goods and services.
Operating
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.
rise; rise
The ________ was created by the Sarbanes-Oxley Act of 2002.
Public Accounting Oversight Board
Olga owns a business and is reviewing her company's current financial statements. As a user of accounting information, Olga is most interested in using this information to ________.
plan and control
Kayla is opening a home health care business that she knows will do well in her community based on prior research. Although she must repay borrowed funds, Kayla chooses ________ to maintain complete control over the business without having to answer to in
debt financing
Financial success ________.
is part of the appeal of becoming an entrepreneur
When the manager of a local auto repair shop decided to expand into a neighboring town, she was making a programmed decision.
f
The basic purpose of directing is to evaluate the success of the planning function.
t
A local bookstore uses an organizational structure in which authority and responsibility are jointly held by the entire group rather than by a single manager. This company is using a ________ organizational structure.
committee
Most top executives began their careers as which type of expert?
technical
Corporate culture often changes to meet new demands in the business environment.
f
Studies indicate that free-rein leadership is the most effective.
t
Jackie is a manager who spends most of her time in day-to-day decisions assigning non-managerial employees to specific jobs. Jackie is considered a ________ manager.
supervisory
Luis is CEO of a new company that makes hand-held computers. He is trying to decide between two operating systems for his product. Luis is ________.
making a nonprogrammed decision
By implementing a needed flight schedule between St. Louis and Chicago, Southwest Airlines was using ________ planning to complete its goals.
Tactical
New Target employees learn during training that they are referred to as team members rather than workers, and that customers are called guests. This is an example of preserving corporate culture.
f
An organization's system of principles, beliefs, and values is called _____.
corporate culture
A formal decision-making process is practical for all companies and organizations.
f
People who make decisions on their own without consulting subordinates are _____.
autocratic leaders
Chau-Lee is the owner-manager of a 24-hour convenience store. When he first opened the business, he employed only four people, and it was easy to manage the store through informal means. The store experienced rapid growth and is now a six-unit chain. Chau
a formal organization structure
A primary ________ of eBay is that they are the world's largest online auction site.
competitive differentiation
Minnesota & Iowa Railway has plans in place to reroute trains in the event that floods or other natural disasters close some of the railroad's tracks. This is an example of ________ planning.
contingency
In a line organization, the staff manager has direct control over functions like production and marketing.
t
Hewlett Packard (HP) is subdivided by its different lines (such as laptops, desktops, mobile devices, printers, and servers). HP is departmentalized by ________.
product
Tactical planning is the primary responsibility of middle managers and supervisors.
f
Which of the following is often a negative result of downsizing?
employee morale declines
_________ is concerned with an individual's perception of fair and equitable treatment.
Equity theory
Union workers at an auto parts plant go out on strike. In response, management closes the plant. This tactic is a ________.
lockout
A need produces ________, which leads to ________.
motivation; goal-directed behavior
David is the head chef in a restaurant and has decided to increase the number of tasks performed by the kitchen staff. The added tasks do not result in increased challenge or authority. David's efforts are called job ________.
enlargement
Collective bargaining encompasses all of the following issues EXCEPT ________.
investor relations
Which of the following is NOT a trend in employee benefits?
Employers are paying a greater percentage of health care costs.
Hel�ne, an industrial sales representative, bought a cellular phone to use if she ever had car trouble while traveling between appointments. Which level of Maslow's need hierarchy is Hel�ne addressing?
safety
Juanita is the captain of her college basketball team. Her long-term goal is to be named to the All American women's basketball team. Juanita is motivated by ________.
self-actualization needs
Most companies base their compensation policies on all of the following factors EXCEPT ________.
worker's previous salary
Antonio is able to select the type of benefits he receives by choosing from a list of possibilities including health insurance, dental and vision plans, and life and disability. This type of "cafeteria" plan is called a ________ benefits plan.
flexible
The desire to be accepted by family members and other individuals is what Maslow called ________ needs.
social
The goal of ________ is to increase employees' interest in their jobs and allow them to learn more about different jobs in the company.
rotation
The function of attracting, developing, and retaining enough qualified employees to perform the activities necessary to accomplish organizational objectives is part of ________.
human resource management
Who must approve the person selected as an arbitrator?
management and labor
Derek runs the finance department for a software company and wants to measure a job candidate's ability in numerical aptitude, general reasoning, and verbal comprehension. According to experts, which test would be ideal for this situation?
cognitive ability test
According to Herzberg, job factors that are essential to job satisfaction although they cannot motivate employees include which of the following?
job security
Beatrice is trying to resolve a labor dispute. She meets with both sides, makes a number of recommendations, and suggests a compromise. Beatrice is acting as a(n) ________ and ________ force a settlement.
mediator; cannot
Robert's company contracted with an outside business to provide technical and computer support. This is an example of ________.
outsourcing
The National Labor Relations Act of 1935 (Wagner Act) required employers to ________.
negotiate with elected representatives of their employees
Jason's team has reached agreement about the role each member is expected to play. Jason's team has reached the ________ stage.
norming
During the performing stage, team members ________.
focus on solving problems
Countries like the United States which tend to rely on explicit written and verbal messages are considered ________ cultures
low-context
In many companies, shared decision-making authority extends to all of the following EXCEPT ________.
selecting members of the board of directors
Jeremy announced to his accounting team that the company's financial reports should be completed "by next week." Subsequently, members of his team had completely different ideas about when the reports were due. At which stage of communication are the team
message decoding
Jahn is a member of a semi-permanent team that performs the day-to-day functions of the organization. Jahn is a member of a(n) ________ team.
work
Lucia is a manager who regularly communicates company news with her employees via e-mail. This is an example of a(n) ________ communication channel.
formal
Which stage of team development is marked by conflicts over the team's mission and the roles of team members?
storming stage
Lisa works for an advertising agency and has presented her client with ideas for new commercials. After the presentation Lisa asks for ________ to determine if the clients correctly understood her message.
feedback
Samuel's company has an unwritten rule that implies all managers must attend team meetings, no matter what projects they're working on. This informal standard of conduct is an example of team ________.
norm
________ listening is the basis for effective communication.
Active
The communication _______ composes the message.
sender
In the United States, most business conversations occur within which zone?
social zone
Deni uses lots of gestures and facial expressions when communicating. These are examples of _____________ communication.
nonverbal
All of the following statements concerning team size are correct EXCEPT:
Small teams make the most demands on team leaders.
All of the following are examples of nonverbal communication EXCEPT ________.
informal speech
Feedback ________.
helps determine whether a message was correctly interpreted
During the forming stage, what is the role of the team leader?
providing time for members to become acquainted
Vanessa wants to encourage interaction among her team members and is planning to move to an open office space without cubicle walls. Vanessa is trying to promote ________.
team cohesiveness
With __________, employees receive stock shares or the value of the stock upon retiring or leaving the company.
stock options
Elijah is a warehouse production manager and has been assigned a complex project that might result in lengthy delays. In order to coordinate all aspects of the production process, Elijah has created a(n) ________ chart.
PERT
When the editors of Contemporary Business use computers, paper, and human effort to create the new edition of a text, they are engaged in ________.
production
Which of the following is a disadvantage of assembly lines?
It is inefficient for producing small batches.
The production manager in a manufacturing company divides employee work into small segments so each employee can concentrate on just a few tasks. This manager is involved in ________.
specialization
How can a firm best protect itself against an interruption in the supply of parts?
Maintain more than one supply source.
Sakura is a production manager and has decided that grouping machinery and equipment according to their functions works best at her company. What layout would be her company be using?
Process
Tamara is the owner of Baker's Dozen, a bakery with all perishable products. What will be her primary consideration in regard to location?
Proximity to her market
The want-satisfying power of a good or service is called ________.
utility
Which of the following is not a primary task of production managers?
Determining what products to produce
Snyder Industries uses 100,000 widgets each year. If Snyder decides to place more orders each year, ordering fewer widgets each time, Snyder will be carrying ________ inventory on average and the risk of running out of inventory will ________.
less; rise
Computer chip manufacturers, such as Intel, must be primarily concerned with ________.
available water supply
Yusted's company uses a computer to control its production process. The computer transmits signals to machines for performing the appropriate steps in the correct order. This is an example of ___________
computer-aided manufacturing
Owen is a factory manager for Gateway Computers and is conducting a visual inspection of component hardware and comparing against established quality standards. Owen is measuring ________.
quality control
Hospital rooms are typically set up with a ________ layout.
customer-oriented
The ABC Accountants do not standardize their service to customers because each customer has different needs. This is an example of _______ production.
intermittent
In selecting a production facility location, labor supply would be most important to which of the following?
Software developer
A firm has total assets of $50 million and owner's equity of $40 million. What is the firm's debt ratio?
20 percent
Expenses that have been incurred (such as wages) but have yet to be paid, are reported on the balance sheet as ________.
Accruals
If a firm has a current ratio of 2.5, it means that for every $2.50 in ________ it has $1.00 in ________.
current assets; current liabilities
Companies such as Coca-Cola generate more than half their annual revenues from sales outside the United States, including Europe. If the dollar gets stronger relative to the euro, what will be the financial impact on the company?
Overall earnings will decrease
Public accountants typically perform all of the following tasks for a business client EXCEPT ________.
developing the firm's marketing strategy
The SEC requires virtually all new public issues of corporate securities to be registered. As part of the registration process for a new security issue, the issuer must prepare a ____.
prospectus
These securities are backed by a pool of mortgage loans purchased from lenders, such as savings banks.
mortgage pass-through security
Which of the following is a depository financial institution?
credit union
Julie is evaluating which state her company will expand into next. She is engaged in the ________ activity.
Investing
The ____ is a collection of financial markets in which previously issued securities are traded among investors.
secondary market
Which of the following financial institutions is organized as a not-for-profit cooperative?
credit union
Deposit insurance shifts most of the financial risk of bank failures from depositors to ________.
the federal government
The natural progression of a business begins with ________.
Financing
Nina's financial institution has an office next to where she works. Everyone who uses the financial institution's services either works for Nina's employer or is related to someone who does. Nina's financial institution is a ________.
credit union
Using the following balance sheet information, find the firm's acid-test ratio.
Cash and marketable securities
$20 million
Accounts receivable
$10 million
Inventory
$30 million
Current liabilities
$30 million
1.00
When the Fed sells government securities, banks have ________ money to lend and economic growth ________.
less; will slow
Which of the following represents the accounting equation?
Assets = Liabilities + Owners' Equity
A _____ is a time deposit at a financial institution, such as a commercial bank, savings bank, or credit union.
CD
Makayla is a corporate CPA working on a new budget. When she lists the company's liabilities, which of the following will she include?
Employees' wages and salaries
Professionals who are responsible for gathering, recording, reporting, and interpreting the financial information of an organization are ________.
Accountants
________ ratios are designed to indicate how successful a firm is in terms of its earnings as compared with its assets or owners' equity.
Profitability
The chairman of the Federal Reserve Board can accelerate economic activity by lowering interest rates. What primary method does the Federal Reserve use to accomplish this?
open market operations
What provision allows the issuer to redeem the bond before its maturity at a specified price?
call provision
Which of the following assets would a firm most likely finance using long-term sources?
another company
Morgan works for a travel agency. Her job involves preparing financial reports and interpreting those reports to provide information for decision making. Which title is appropriate for Morgan's job?
Accountant
If the Fed reduced reserve requirements, ________.
banks would have more money to lend out
Sean made a purchase at his local Walmart. Instead of writing a check, Sean used a card issued by his bank with a Visa logo on the front. He entered his PIN and the purchase was automatically deducted from his checking account. Sean used his ________ card
Debit
Jasmine works in the financial division of her company and is responsible for preparing monetary forecasts and analyzing major investment decisions. What is Jasmine's title?
vice president for financial management
________ activities provide the necessary funds to start a business and to expand it after it begins operations.
Financing
_____ are investment companies that raise funds from wealthy individuals and institutional investors and use the funds to make investments in both public and private companies.
Private equity funds
All of the following actions result in equity capital EXCEPT ________.
issuing bonds
Most private placements are ________.
corporate debt issues
Which of the following financial institutions would invest the greatest percentage of its assets in common stocks and other long-term investments?
pension fund
Leverage ________ the return to shareholders and ________ the risk of their investment.
increases; increases
When a company needs capital to purchase inventory, expand a plant, make major investments, acquire another firm, or pursue other business goals, it may sell a bond or stock issue to the investing public. This is done which market?
primary market
Grace is the financial manager for Empire State Fabrication and has decided to raise additional funds for the company by raising equity capital. She might do so by ________.
persuading existing owners to contribute additional funds
in recent years, mortgage pass-through securities consist of pools of _____, loans made to borrowers with poor credit ratings.
subprime mortgages
_____ is a form of short-term financing sold by corporations, such as Salton Brands, that mature from 1 to 270 days after the date of issue.
Commercial paper