SECTION A 30 MarksThere Are THIRTY

SECTION A (30 Marks)

There are THIRTY (30) questions in this part. Answer ALL questions.

1. The customs, values, and demographic characteristics of the society in which an organization functions are the principal elements of the political-legal environment. 2) Physical resources include the data and other information used by businesses. 3) Economic systems differ in how factors of production are used. 4) The point at which the supply curve and the demand curve intersect is the market price. 5) Aggregate output refers to a company's annual production of goods or services. 6) The United States government manages the collection and spending of its revenues through monetary policy. 7) The pursuit of profits is how a business differs from organizations such as most universities, hospitals, and government agencies. 8) The technological environment includes only electronics and telecommunications used to perform business activities. 9) One of the four elements that are necessary for private enterprise to be carried out is reasonable prices. 10) In typical modern oligopolies, the large capital investment necessary to enter the market discourages new competitors. 11) Ethics are beliefs about what is right and wrong. 12) Business ethics refers to ethical or unethical behaviors by employees in the context of their personal lives. 13) The standards of behavior that guide managers in their work are called employee ethics. 14) Some ethical and unethical behaviors fall into gray areas, while others are widely agreed upon. 15) A conflict of interest occurs when an activity may benefit the individual to the detriment of his or her employer. 16) Accepting and offering bribes is a normal part of doing business in some parts of the world. 17) The proactive approach to social responsibility argues that profits should not be spent on social programs. 18) Ethical values do not vary from person to person. 19) What constitutes ethical behavior is determined entirely by the individual. 20) An individual's personal code of ethics is shaped by his or her life experiences. 21) The Small Business Administration is the government agency charged with owning small businesses. 22) Small businesses produce more patents per employee than large patenting firms. 23) Most businesses in the United States are large businesses with more than 500 employees. 24) Major innovations are most likely to come from large corporations. 25) Manufacturing is overwhelmingly handled by big business. 26) People who assume the risk of business ownership with a primary goal of growth and expansion are called entrepreneurs. 27) Most successful entrepreneurs have a strong desire to be their own bosses. 28) A business plan demonstrates how an entrepreneur's business strategy will be implemented. 29) Franchisees may be obligated to contribute a percentage of sales to parent corporations. 30) Loans are the most important sources of money for new businesses.

SECTION B (30 Marks)

There are THIRTY (30) questions in this part. Answer ALL questions.

31) Which environment is NOT an important dimension of a business organization's external environment? A) the political-legal environment B) the sociocultural environment C) the technological environment D) the corporate cultural environment E) the global business environment 32) What term denotes a nation's basis for allocating its resources among its citizens? A) capital structure B) economic system C) ownership processes D) distribution network E) national regulations 33) What is the process for converting government enterprises into individually owned firms known as? A) production allocation B) privatization C) entrepreneurship D) demand assessment E) profit maximization 34) What is the point at which the supply curve and the demand curve intersect on a graph? A) equilibrium price B) decision point C) surplus price D) perfect price E) parity point 35) What is the price at which the quantity of goods demanded and the quantity of goods supplied are equal? A) the going rate B) the margin rate C) the market price D) the optimum price E) the cost price 36) What occurs when the quantity demanded exceeds the quantity supplied? A) demand deficit B) surplus C) equilibrium point D) shortage E) supply schedule 37) Which of the following does NOT represent a degree of competition in a private enterprise system? A) oligopoly B) socialism C) monopoly D) perfect competition E) monopolistic competition 38) Which of the following exists when an industry or market has only one producer? A) competition B) oligopoly C) monopoly D) communism E) socialism 39) Which term refers to the pattern of short-term ups and downs in an economy? A) aggregate output B) business cycle C) standard of living D) balance of payments E) demand and supply schedule 40) Which term refers to the total quantity and quality of goods and services that people living in an economic system can purchase? A) business cycle B) demand and supply schedule C) standard of living D) aggregate output E) consumer price index 41) What are beliefs about what is right and wrong or good and bad called? A) motivators B) rules C) cultures D) ethics E) laws 42) Which of the following should be the first step in assessing ethical behavior in a certain situation? A) Seek the advice of managers. B) Make a judgment based on the outcome of the activity. C) Consider appropriate moral values. D) Collect facts related to the situation. E) Gather a range of opinions on the effectiveness of the policy. 43) What is likely the single MOST effective step that a company can take to set ethical standards? A) Offer large cash awards for whistle-blowing. B) Suggest that employees take ethics training. C) Post ethical rules on bulletin boards. D) State that the workplace values diversity. E) Demonstrate support from top management. 44) How do top managers BEST demonstrate a commitment to ethical business practices? A) by adopting written codes of ethics B) by reading employees' e-mails C) by decentralized decision-making practices D) by cooperating with other companies E) by monitoring employees' Web searches 45) Which statement about codes of ethics is FALSE? A) Fewer and fewer companies are adopting codes of ethics. B) Codes of ethics are determined by company managers. C) Some ethical responses can be learned through experience. D) Social responsibility involves providing quality products and pricing products fairly. E) Core principles and values should remain a constant characteristic of a company. 46) Which of the following statements is MOST likely to be included in a company's code of ethics? A) We reward high achievers. B) We strive for domination in the market. C) We achieve our objective by raising capital. D) We believe in our company brand. E) We reward all valuable contributions. 47) What term refers to the way in which a business tries to balance its commitments to groups and individuals in its social environment? A) business ethics B) socialization C) stakeholder consciousness D) social responsibility E) corporatization 48) How often should an organization change its objectives? A) constantly B) infrequently C) every year D) every decade E) never 49) What is the term given to the groups, individuals, and organizations that are directly affected by the practices of an organization? A) primary agents of interest B) social auditors C) senior managers D) organizational stakeholders E) local communities 50) Advertising for which of the following products is MOST likely to have ethical ramifications? A) swimwear B) sporting equipment C) decaffeinated beverages D) books E) alcohol 51) Which entity is defined as independent and has little influence on its market? A) corporation B) joint venture C) small business D) partnership E) government agency 52) Entrepreneurs often have more than one goal for starting a business and becoming self- employed. Which of the following reasons is the LEAST common goal of entrepreneurs? A) to seek independence and be their own boss B) to earn a comfortable living for a period of time C) to grow and expand a current business D) to meet community or social obligations E) to provide for their financial needs 53) What is the name of the document in which an entrepreneur summarizes his or her business strategy for a proposed new venture? A) success chart B) director's guideline C) financial blueprint D) business plan E) balance sheet 54) What is the MOST significant disadvantage of owning a franchise? A) start-up costs B) operational guidelines C) difficulty obtaining loans D) double taxation E) competition 55) Which of the following is the MOST significant disadvantage of starting a business from scratch? A) having few employees B) inability to franchise C) having competition D) coming up with new ideas E) the risk of failure 56) What is the MOST important source of money for new business start-ups? A) banks B) the SBA C) personal resources D) government grants E) venture capital

57) Who constitutes the membership of SCORE? A) retired executives B) venture capitalists C) company officers D) commercial lenders E) successful entrepreneurs 58) Which of the following represents the fastest-growing segment of minority business ownership? A) African Americans B) Asians C) Hispanics D) Pacific Islanders E) Europeans 59) Which of the following types of businesses is MOST common in the United States? A) sole proprietorships B) general partnerships C) cooperatives D) corporations E) limited partnerships 60) What percent of a business is the least amount that a master partner will retain? A) 10 percent B) 25 percent C) 50 percent D) 75 percent E) 80 percent

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