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Trusts and Big Business

A government is laissez-faire when itfairly regulates workers.fairly regulates businesses.does not interfere with business affairs and does not regulate its actions.leaves workers alone and doesn’t regulate unions. c
Why was Carnegie Steel able to offer its product more cheaply than its competitors? Carnegie introduced the Bessemer process, which decreased the cost of production.Carnegie cut corners in his production, lowering his costs.Carnegie could cut his costs because he owned the supply of raw materials and the means of production and distribution.Carnegie made an inferior product, so it was less expensive to produce. c
What is the main reason that the American public turned against monopolies?They saw the price of goods rise as their wages decreased.They saw the price of goods rise as their wages increased.They resented the wealth of the big business owners. They were concerned about smaller businesses. a
Why did government officials allow monopolies to operate without strong regulations during the Gilded Age? They believed monopolies would keep competition alive.They believed monopolies were responsible for the growth of the economy.They believed monopolies would treat their workers well.They believed monopolies were the most successful way for businesses to make a profit. b
How did John D. Rockefeller vertically integrate his monopoly in 1882?He created a trust that controlled oil wells, refineries, and distribution networks.He created a trust that controlled ninety percent of the nation’s oil refineries.He purchased coal plants around the country to add to his business.He purchased iron mines around the country to add to his business. a
Which company was a monopoly during the Gilded Age?MicrosoftAT&TAllegheny SteelCarnegie Steel d
What was the main reason that Carnegie invested in the Frick Coke Company?He wanted to make sure he could always get fuel for his steel plant.He thought he could help the company become profitable.He wanted to invest in new technology.He was interested in the coal business. a
Why was the Cleveland Massacre significant in the formation of Standard Oil?Standard Oil significantly improved its business practices after the Cleveland Massacre.Standard Oil was bought out by other Cleveland companies after the Massacre.Standard Oil closed down after the Cleveland Massacre.Standard Oil became a monopoly in the Cleveland oil market after the Massacre. d
How did the Carnegie’s purchase of Allegheny Steel contribute to the formation of his monopoly?The purchase gave Carnegie new access to the raw materials he needed.The purchase enabled Carnegie to discover a more efficient production method.The purchase enabled Carnegie to control most of the rail lines.The purchase gave Carnegie control of coke production. b
The Cleveland Massacre wasa takeover by Standard Oil of the refineries in Cleveland.a labor dispute at Standard Oil in Cleveland that turned violent. an attempt to stop Standard Oil from becoming a monopoly.a failed attempt by Standard Oil to take over other refineries. a
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Chapter 6 HW Business

Leveling the playing field for home-based businesses, ___________ has (have) made starting a home-based business much more affordable. broadband Internet connections and other technologies
The primary concerns when first starting your business are: financing and planning.
A business plan for a new business does not need to include: the names of the prospective lending companies.
According to the textbook, one of the drawbacks of using venture capital is that: venture capital firms may ask for a high stake in your business.
For a market to exist there must be potential buyers: who have a willingness and the resources to buy.
Why do incubator facilities continue to remain very popular with start-up businesses? By providing essential services to entrepreneurs, they have a very strong success rate.
Why do experts agree that small-business management and large-business management are similar in practice? Similar to large businesses, small business have concerns about obtaining capital and good marketing and management practices.
Which of the following is a false statement about small business? The first job for most Americans is unlikely to be in a small business.
Although the business plan has a great amount of detail and requires thoroughness, a well-explained business idea will come to life almost immediately in which part of this document? The executive summary
A small business advantage is ________. the ability to quickly adapt to customer needs
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Intro to Business

Importing buying products from another country
Exporting the selling of products to another country
Who is the largest importer in the global market today? The United States
In volume of exports, the three leading nations are The United States, Germany, and China
The world market is approximately 7 billion potential customers
Which of the following continents is home to the largest percentage of the world’s population? Asia
A nation has a ___________ in the production of a good or service if it can produce that good or service more effectively or efficiently than it can produce other goods. comparative advantage
__________ occurs when a country has a monopoly on producing a product or is able to produce it at a cost well below that of all other countries. Absolute advantage
The theory of comparative advantage exists because: no nation can produce all the products its people want and need.
The concept of free trade means: goods and services can be traded freely across borders without political and/or economic barriers.
One advantage of free trade is innovation for new products occurs which keeps firms competitively challenged.
Free trade between nations generally results in: mutually beneficial exchange relationships.
A free trade agreement is likely to result in an increase in imported goods and services
The movement of goods and services among nations without political or economic barriers free trade
States that a country should sell to other countries those products that it produces most effectively and efficiently, and buy from other countries those products it cannot produce as effectively or efficiently comparative advantage theory
If it has a monopoly on producing a specific product or is able to produce it more efficiently than all other countries absolute advantage
the total value of a nation’s exports compared to its imports measured over a particular period. The balance of trade
the difference between money coming into a country (from exports) and money leaving the country (for imports) plus money flows coming into or leaving a country from other factors such as tourism, foreign aid, military expenditures, and foreign investment. The balance of payments
the practice of selling products in a foreign country at lower prices than those charged in the producing country dumping
involves a foreign company producing private-label goods to which a domestic company then attaches its own brand name or trademark contract manufacturing
a partnership in which two or more companies (often from different countries) join to undertake a major project A joint venture
a long-term partnership between two or more companies established to help each company build competitive market advantages A strategic alliance
the buying of permanent property and businesses in foreign nations foreign direct investment
an organization that manufactures and markets products in many different countries and has multinational stock ownership and multinational management A multinational corporation
an attitude that one’s own culture is superior to all others. In contrast, foreign businesspeople are very good at adapting to U.S. culture ethnocentricity
the value of one nation’s currency relative to the currencies of other countries exchange rate
lowering the value of a nation’s currency relative to other countries devaluation
a complex form of bartering in which several countries may be involved, each trading goods or services for services countertrading
the use of government regulations to limit the import of goods and services trade protectionism
taxes on imports, thus making imported goods more expensive to buy tariffs
limits the number of products in certain categories that a nation can import An import quota
a complete ban on the import or export of a certain product or the stopping of all trade with a particular country An embargo
an international forum for negotiating mutual reductions in trade restrictions General Agreement on Tariffs and Trade
to assume the task of mediating trade disputes among nations World Trade Organizations
a regional group of countries that have a common external tariff, no internal tariffs, and the coordination of laws to facilitate exchange among member countries A common market
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Chapter 10: Economic Growth, the Financial System, and Business Cycles

Business Cycle Alternating periods of economic expansion and economic recession.
Expansion During the __________ phase of the business cycle, production, employment, and income increase.
Recession During the __________ phase of the business cycle, production, employment, and income decrease.
D. All of The Above Which of the following contribute(s) to shorter recessions, longer expansions, and less severe fluctuations in real GDP? (Mark all that apply.)A. Monetary policyB. Unemployment insuranceC. A service-based economyD. All of the aboveE. A and C only
Long-Run Economic Growth The process by which rising productivity increases the average standard of living.
B. Capital, Labor Productivity, and Technology. Long-run growth in GDP is determined byA. Labor productivity, capital, and government expenditures.B. Capital, labor productivity, and technology.C. Consumption, investment, and government expenditures.D. Technology, investment, and consumption.
D. Increases in Human Capital Which of the following is most likely to lead to sustained long-run growth?A. Increases in the labor participation rateB. Transfer of workers from agricultural to industrial sectorsC. Exploitation of natural resourcesD. Increases in human capital
A. Increases in Average Wages Which of the following does NOT lead to long-run economic growth?A. Increases in average wagesB. Improved labor productivityC. Technological changeD. Increase in the capital stock
Labor Productivity The quantity of goods and services that can be produced by one worker or by one hour of work.
Capital Manufactured goods that are used to produce other goods and services.
Potential GDP The level of real GDP attained when all firms are producing at capacity.
E. B and C only. Potential GDPA. Measures the maximum that a firm is capable of producing.B. Increases over time as the labor force grows.C. Increases over time as technological change occurs.D. All of the above.E. B and C only.
Financial System The system of financial markets and financial intermediaries through which firms acquire funds from households.
Financial Markets Markets where financial securities, such as stocks and bonds, are bought and sold.
Financial Intermediaries Firms, such as banks, mutual funds, pension funds, and insurance companies, that borrow funds from savers and lend them to borrowers.
Excess and Borrow Firms that act as financial intermediaries match households that have __________ funds with firms that want to __________.
Information A key service the financial system provides to savers and lenders is to collect and communicate __________ about borrowers to savers.
Financial Investments A key service the financial system provides to savers and lenders is to allow savers to spread their money among many __________.
Method of Exchanging A key service the financial system provides to savers and lenders is to provide __________ a financial security for money.
GDP (Y) The variable Y is an abbreviation for __________.
Consumption (C) The variable C is an abbreviation for __________. A component of GDP.
Investment (I) The variable I is an abbreviation for __________. A component of GDP.
Government Purchases (G) The variable G is an abbreviation for __________. A component of GDP.
Net Exports (NX) The variable NX is an abbreviation for __________. A component of GDP in an open economy.
Y = C + I + G + NX In an open economy, there is interaction with other economies in terms of both trading goods and services and borrowing and lending money. The relationship between GDP and its components in an open economy can be written as __________.
Y = C + I + G In a closed economy, there is no trading or borrowing and lending with other economies. Net exports are zero. The relationship between GDP and its components can be written as __________.
I = Y – C – G When the equation showing the relationship between GDP and its components is rearranged, an expression for total investment in terms of the other variables can be written as __________.
Private Saving (SvPrivate) The variable SvPrivate is an abbreviation for __________.
Household Income (Y) The variable Y is an abbreviation for __________. A component of private saving.
Transfer Payments (TR) The variable TR is an abbreviation for __________. A component of private saving.
Goods and Services (C) The variable C is an abbreviation for __________. A component of private saving.
Taxes (T) The variable T is an abbreviation for __________. A component of private saving.
SvPrivate = Y + TR – C – T The relationship between private saving and its components can be written as __________.
Public Saving (SvPublic) The variable SvPublic is an abbreviation for __________. It equals the amount of tax revenue the government retains after paying for government purchases and making transfer payments to households.
SvPublic = T – G – TR The relationship between public saving and its components can be written as:
Total Saving (S) The variable S is an abbreviation for __________. It is equal to the sum of private saving and public saving.
S = SvPrivate + SvPublic The relationship between total saving and its components can be written as __________ or:S = (Y + TR – C – T) + (T – G – TR), or:S = Y – C – G
It can be concluded that total saving must equal total investment. This relationship can be written as __________.
$2 trillion and $1 trillion In a closed economy, the values for GDP, consumption spending, investment spending, transfer payments, and taxes are as follows:Y = $12 trillionC = $9 trillionI = $3 trillionTR = $2 trillionT = $3 trillionUsing the information above, private savings equals __________ and public savings equals __________.
Market for Loanable Funds The interaction of borrowers and lenders that determines the market interest rate and the quantity of loanable funds exchanged.
B. Technological Change Which of the following is most likely to lead to sustained long-term growth?A. Increases in the labor production rateB. Technological changeC. Exploitation of natural resourcesD. Transfer of workers from agricultural to industrial sectors
A, C, D, and E Technological progress is affected by (check all that apply). A. Private property rightsB. Population growthC. EntrepreneurshipD. New software developmentsE. Investment in capital
Crowding Out The interaction of borrowers and lenders that determines the market interest rate and the quantity of loanable funds exchanged.
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Intro to business chapter 7

Which of the following activities is part of the “planning” function of management? Assigning a particular worker to do a specific task Looking at market forecasts to identify future business opportunities and challenges Praising a sales representative who has far exceeded her monthly sales objectives Conducting a job interview with a potential new employee Looking at market forecasts to identify future business opportunities and challenges
Rob intends to major in accounting because he is confident that an ability to read and interpret financial and accounting data is the way to get to the top in business. Rob seems to be concerned with developing his: technical skills. verbal skills. qualitative skills. conceptual skills. technical skills
Which of the following would be a concern addressed in a strategic plan? Should the firm make a long-term commitment to expand into new markets? Which specific jobs should be assigned to each employee? How much output should be produced this week in a given production facility? Which computer software package should the firm’s human resources office use to manage the payroll? Should the firm make a long-term commitment to expand into new markets?
Adam is a first-line manager for Idle Time Gaming, Inc., a company whose values and focus is innovation. Having recently transferred in from a traditional retail (top/down) company, which of the following changes will the new company expect Adam to embrace? He must continue to issue detailed instructions to give the teams a sense of direction He will no longer have a management position in the firm, since the purpose of teams is to eliminate the need for first-line managers He will need to act less like a “boss” and more like a coach, advisor, counselor, and team player He will isolate himself from his subordinates He will need to act less like a “boss” and more like a coach, advisor, counselor, and team player
Which of the following statements about effective leadership is the most accurate? Effective leaders have the same personality traits The most effective leadership style depends on who is being led and in what situation The democratic style of leadership will almost always improve the effectiveness of the organization One trait of effective managers is that they consistently maintain the same style of leadership The most effective leadership style depends on who is being led and in what situation
When managers identify a market trend that suggests a new opportunity and then devise a strategy to go after this new opportunity, they are involved in the function of: controlling. planning. leading. organizing. planning.
Kayla is a supervisor who manages a production line. She spends several hours each week developing specific employee work assignments and production schedules for the coming week so that the production department can meet its short-term production objectives. This suggests that a significant component of Kayla’s job involves: strategic planning. contingency planning. tactical planning. operational planning. operational planning.
Jenna Raiter, the president and CEO of AutoMotion Auto Service Centers, has asked several managers and employees to help establish a statement to outline the fundamental purposes of their company. The result of this effort is likely to be a document known as a(n): payoff matrix. mission statement. tactical plan. organization chart. mission statement.
After thirteen years as a laborer for Hendrix Construction, Jimmy was promoted to the position of foreman. He is directly responsible for assigning various jobs to his work crew and evaluating their performance on a daily basis. Jimmy is now a member of: top management. middle management. supervisory management. forward management. supervisory management.
Two years ago, Travis started his own restaurant supply company, serving the greater Chicago area. Until recently, he has never concerned himself with establishing a formal control system. Now, with a recession looming, he is experiencing cost conscious restaurant owners. He has decided that a formal control system is needed. The first step Travis should take is: draw up a formal organization chart. talk to his banker to set financial goals. devise a set of clear performance standards. design an accident report form so that he can keep accurate records of all accidents that occur. devise a set of clear performance standards.
__________ is the art of utilizing organizational resources to accomplish goals at work. A. SocializationB. JustificationC. PreparationD. Management management
Management is more progressive today. There is more emphasis on: A. individual work that can be successfully measured.B. working in teams.C. striving to eliminate the control function of management.D. placing greater reliance on the government for financing. working in teams
One of the challenges facing today’s managers is to: A. deal with a workforce that is less educated and less self-directed than in the past.B. find ways to encourage conformity instead of diversity.C. work with a more educated workforce.D. cope with the sudden and unexpected slowdown in the pace of innovation and change. work with a more educated workforce
Today’s progressive managers: A. prefer to use the autocratic style of leadership.B. emphasize teamwork and cooperation rather than discipline and order-giving.C. face fewer challenges and problems than managers in the past.D. can rely on a much higher level of worker loyalty to the organization than in the past. B
Which of the following statements comparing today’s workers with those from earlier eras is most accurate? Compared to earlier workers, today’s employees are: A. more loyal to the firm.B. less educated and less self-directed.C. more willing to leave the firm to seek better opportunities.D. more likely to need direct guidance and direction from their managers. c
The revolution in management that is currently underway suggests that the most effective managers of the future will: A. be very strict in their treatment of workers.B. emphasize individual initiative rather than teamwork.C. specialize in performing one of the four management functions.D. emphasize team work. d
How are managers today different from managers in the past? A. Managers today are more likely to reprimand workersB. Managers in the past would use praise and gentle suggestionsC. Managers in the past were less loyal to their employerD. Managers today emphasize teamwork d
Which of the following statements has resulted in changes in the role of management? A. Most workers today show little initiative or creativity, so managers must spend more time directing their effortsB. The marketplace is becoming global, which increases both competition and opportunities for cooperation and integrationC. Firms are recognizing that their workforces are too diverse, so managers must find ways to reduce diversity without violating federal laws against discriminationD. The desire to encourage teamwork has resulted in larger, more cumbersome organizations with too many workers b
One of the four primary functions of management is: A. controlling.B. marketing.C. financing.D. designing. A
The management function concerned with anticipating future trends and determining the best strategies to achieve an organization’s goals and objectives is known as: A. directing.B. leadership.C. planning.D. forecasting. C
According to the “Reaching Beyond Our Borders” box in Chapter 7, Jack Welch, former CEO of General Electric, said the key problem companies face in addressing opportunities for in the global market is: A. the lack of engineer and scientists in the global market.B. the lack of support from the U.S. government for global expansion.C. the lack of professional managers at all levels to run operations.D. the lack of production capability to keep up with global demand. C
When managers work on creating conditions and systems to ensure that everything and everyone works together to achieve the organization’s goals, they are involved in the __________ function of management. A. controllingB. leadingC. planningD. organizing D
__________ is the management function that involves determining whether an organization is progressing toward its goals, rewarding employees for doing a good job, and taking corrective action when they are not. A. OrganizingB. ControllingC. LeadingD. Officiating B
___________ is the management function that involves setting goals, strategies, and tactics for achieving the organization’s goals and objectives. A. ForecastingB. PlanningC. ConceptualizingD. Controlling B
___________ is the management function of creating a vision for the organization and guiding, training, coaching, and motivating employees to help achieve the goals and objectives of the organization. A. OrganizingB. ControllingC. LeadingD. Officiating C
Which of the following goals best describes today’s view of the organizing function? Organizing today focuses on: A. achieving unified opinions from a diversified workforce.B. designing the organization around the customer.C. simplifying the process of measuring outcomes related to performance standards.D. developing the most efficient strategic plans for the firm. B
When managers determine that an organization is not making sufficient progress toward achieving its goals and objectives and they develop corrective measures, they are involved in: A. controlling.B. planning.C. directing.D. accounting. A
When managers identify a market trend that suggests a new opportunity and then devise a strategy to go after this new opportunity, they are involved in the function of: A. controlling.B. planning.C. leading.D. organizing. B
Which of the following activities would be a part of the leading function of management? A. Devising a new strategic plan to enter a new foreign market currently dominated by a competing firmB. Recruiting qualified workers to join the organization and assigning them to their proper positionC. Examining a financial report to see whether the firm’s profits are improving and taking corrective action if they are notD. Training and coaching workers to help them understand their job and perform it effectively D
Which of the following activities is part of the planning function of management? A. Assigning a particular worker to do a specific taskB. Looking at market forecasts to identify future business opportunities and challengesC. Praising a sales representative who has far exceeded her monthly sales objectivesD. Conducting a job interview with a potential new employee B
Which of the following activities is part of the organizing function of management? A. Going over a spreadsheet to analyze some financial dataB. Teaching a new employee how to use a piece of office equipmentC. Giving front-line workers additional resources needed to provide faster and better service to customersD. Developing a broad general strategy to help the organization meet its long-term growth objectives C. Giving front-line workers additional resources needed to provide faster and better service to customers
As a manager, two of Sylvia’s strengths are her ability to communicate goals clearly, and her ability to guide, coach, and motivate workers. Based on these strengths, __________ is a management function that Sylvia is likely to be good at performing. A. ControllingB. PlanningC. LeadingD. Organizing C LEADING
Amanda, a regional manager for Flairol Cosmetics, has just seen a report showing that sales in her region are trending lower than anticipated for the third quarter. Her next task is to determine the reason for the disappointing results and find a way to get sales up to their desired level. Amanda’s efforts are part of the ____________ function of management. A. controllingB. directingC. organizingD. planning A
A __________ is an overall explanation of why an organization exists and where it is trying to head. A. tactical planB. prime directiveC. corporate charterD. vision D
A vision for a company is: A. an explanation of why the company exists and where it wants to go.B. the same thing as an objective.C. a detailed plan that outlines the major organizational structure of the firm.D. very relevant for the short-term, but less useful for the long-term. A
A meaningful mission statement should address topics such as the organization’s: A. form of ownership and methods of financing.B. self-concept and company philosophy.C. advertising strategy and distribution plan.D. tactical plans and contingency plans. B
The revolution in management that is currently underway suggests that the most effective managers of the future will: emphasize teamwork
Monica was hired by the Misty Mount Corporation to take over as the new chief executive officer. Her initial impression is that the company is in disarray, primarily because the employees do not have a sense of purpose or a common set of values. Monica’s observations suggest that she needs to provide a(n) _________ for Misty Mount: vision
Gabriella is responsible for hiring, motivating, and retaining the best employees for her organization. Gabriella is in charge of: staffing
A basic difference between goals and objectives is that goals are: concerned with broad, long-term accomplishments, while objectives focus on specific short-term details
Amanda, a regional manager for Flairol Cosmetics, has just seen a report showing that sales in her region are trending lower than anticipated for the third quarter. Her next task is to determine the reason for the disappointing results and find a way to get sales up to their desired level. Amanda’s efforts are part of the ____________ function of management. controlling
Autocratic leadership is likely to be effective when: the organization faces an emergency situation