Q&A Hero

Q: When a new product has high demand in the market, how should a company react? A) Increase the supply of the product B) Decrease the supply of the product C) Reduce the price of the product D) Maintain the current supply until demand falls E) Create an artificial shortage of the product

Q: What is the term used to describe a market condition where buyers are able to satisfy the demand of the consumer, yet have some product remain unsold? A) Surplus B) Stoppage C) Shortage D) Demand deficit E) Equilibrium price

Q: Which of the following is the MOST likely pricing approach for a monopoly? A) Charge customers whatever you please B) Give customers a real bargain on price C) Charge a price that will not cause consumer demand to drop D) Undercut the prices of the competition E) Give customers a fair price that cannot be matched by competitors

Q: In an oligopoly, when one firm reduces its prices, how do other sellers react? A) There is no reaction from other firms to change their prices. B) Other firms reduce their prices also, usually quite quickly. C) Other firms may reduce their prices, but usually gradually. D) Other firms are not usually aware that price has changed. E) There is a combined response from other firms to stabilize prices.

Q: How does monopolistic competition differ from perfect competition? A) There are more sellers in a market characterized by monopolistic competition. B) It is easier for sellers to enter a market or industry characterized by monopolistic competition. C) In a perfectly competitive market, products are more dissimilar. D) In a market characterized by monopolistic competition, individual firms have some control over price. E) In a perfectly competitive market, the size of the firms must be large.

Q: In perfect competition, which of the following conditions must prevail? A) All firms must adhere to cost and pricing standards. B) The number of firms in the industry must be limited. C) A single firm is able to influence the price of its product. D) It is relatively difficult to enter the industry. E) All firms in a given industry must be small.

Q: Which of the following is one of the elements required in private enterprise? A) Adequate representation in the government B) Freedom from foreign competition C) The opportunity for market leadership D) The right to ownership of property E) Numerous regulatory agencies

Q: What is created when one company is able to supply all the goods or services needed by the marketplace? A) Communism B) Natural monopolies C) Marketplace shifts D) Monopolistic competition E) Oligopolies

Q: When there are many small firms in a specific industry, what is likely to occur? A) Competitive advantage B) An oligopoly C) Private enterprise D) Perfect competition E) Market force reliability

Q: Which of the following does NOT fall into the degrees of competition continuum? A) Perfect competition B) Monopolistic competition C) Competitive advantage D) Oligopoly E) Monopoly

Q: What is needed to gain a competitive advantage over competitors? A) The ability to produce goods and services and sell those at a fixed profit B) The ability to produce goods and services and sell those at a small profit C) The ability to produce goods or services efficiently and at a reasonable profit D) The ability to leverage the internet to sell in a global marketplace Answer: C

Q: Which of the following would lead some to become an entrepreneur and influence the choice of goods or services to produce? A) Competition B) Profit C) Degrees of competition D) Government regulation E) Monopolistic competition

Q: Which of the following represents the ownership of resources used in a private enterprise system? A) Freedom of choice B) Private property rights C) Increased profits D) Limited competition E) Perfect competition

Q: What is the basis for a market economy? A) The ability to pursue an interest with minimal government restriction B) The ability to limit profits on competitors based on government restriction C) The ability to offer a good or service at a variety of price points D) A limitation on the number of competitors the government will allow within a specific geographic region E) The ability of a large number of smaller firms in an industry will limit influence

Q: Graphically, what has been achieved when price of goods demanded is equal to the quantity of goods supplied? A) Supply curve optimization B) Potential for surplus C) Price reductions D) Freedom of choice opportunities E) Equilibrium price

Q: What can be used to determine relationships among different levels of demand and supply, based on price? A) Market economies B) Degrees of competition C) Surplus to shortage relationships D) Demand and supply curves E) Private enterprise competition

Q: Which of the following is proven when buyers purchase more of a product when the price drops and less when the price increases? A) Demand B) Laws of supply C) Laws of demand D) Degree of competition E) Free market economy

Q: What is the willingness and ability of producers to offer a good for sale referred to as? A) Private enterprise B) Supply C) Free market economy D) Law of supply E) Degrees of competition

Q: What is the primary force that determines what a firm buys and sells? A) Laws of supply and demand B) The demand and supply schedule C) Economic resources D) Equilibrium price E) The private enterprise system

Q: What occurs when the quantity demanded exceeds the quantity supplied? A) Demand deficit B) Surplus C) Equilibrium point D) Shortage E) Price drop

Q: 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

Q: 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

Q: Identify the five factors of production and their role in economic systems.

Q: Describe the role of information resources in business.

Q: Discuss the two forms of planned economies and give examples of each.

Q: In a market economy, there is a centralized government that controls factors of production and decision making.

Q: China functions as a communistic economy and political system.

Q: In a market system, individuals are limited as to what they can buy and in how they can spend their money.

Q: The technological environment includes only electronics and telecommunications used to perform business activities.

Q: Physical resources include the data and other information used by businesses.

Q: The customs, values, and demographic characteristics of the society in which an organization functions are the principal elements of the political-legal environment.

Q: What marks the key difference between economic systems? A) The way the factors of production are managed B) The way goods are transported within their borders C) The way rules and regulations are legislated D) The way workers are relocated to different regions E) The way basic necessities are determined

Q: In which type of economy do the individual producer and consumer control production through supply and demand? A) Planned B) Communist C) Market D) Socialist E) Mixed

Q: Which economic system emphasizes the private ownership of most factors of production? A) Socialism B) Communism C) Capitalism D) Marxism E) Federalism

Q: What does a planned economy rely on a centralized government to do? A) Support free enterprise in every way possible B) Determine how to allocate all or most factors of production C) Encourage citizens to buy shares of stock in small companies D) Keep its control activities to a minimum E) Direct workers to start their own small businesses

Q: What type of economy is the United States reflective of? A) Planned B) Mixed C) Market D) Private E) Socialist

Q: Which of the following best explains the difference between a market economy and a planned economy? A) In a planned economy, consumers have little choice in where people work or what they purchase or pay. In a market economy, there is more choice in where people work or what they purchase or pay. B) In a market economy, consumers must pay what the market demands. C) Capitalism is the root of a planned economy. D) Market economies are also known as mixed market economies. E) Planned economies promote the use of privatization to increase market share.

Q: The idea that individuals would contribute according to their abilities and receive benefits according to their needs supports which type of economy? A) Market economy B) Socialist based economy C) Mixed market economy D) Capitalist market economy E) Communist based economy

Q: When making decisions about production and allocation, which type of system depends on individual producers and consumers to create a combination of supply and demand? A) Planned economy B) Communism C) Private economy D) Market economy E) Socialism

Q: What factor of production is used to generate forecasts based on specialized knowledge and economic data? A) Economic resources B) Labor C) Information resources D) Entrepreneurs E) Physical resources

Q: Who is the person who accepts the risks and opportunities inherent in a new business opportunity? A) Capital managers B) Entrepreneurs C) Human resources D) Home country economic systems managers E) Information technology managers

Q: What is the term for the physical and intellectual contributions of people while engaged in the production of goods and services? A) Human resources B) Working capital C) Physical resources D) Planned resources E) Market resources

Q: 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

Q: 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

Q: What is the general term for resources used by a business to produce a good or service referred to as? A) Labor B) Human Resources C) Human capital D) Factors of production E) Economic systems

Q: What are the benefits of business for society?

Q: How do consumer choice and demand affect a capitalistic system?

Q: Compare a sociocultural environment to an economic environment.

Q: An organization's external environment consists of everything outside of the organization that might affect it.

Q: The pursuit of profits is how a business differs from organizations such as public universities, public hospitals, and government agencies.

Q: Changes in which type of business environment can reduce or replace the need for traditional working methods, physical equipment, and other platforms needed to conduct business? A) Global business environment B) Economic environment C) Domestic business environment D) Technological environment E) Political-legal environment

Q: Factors such as international trade agreements, economic conditions, and political unrest will have the greatest impact on what type of business environment? A) Global business environment B) Economic environment C) Domestic business environment D) Technological environment E) Political-legal environment

Q: What is the environment where a firm conducts its operations and derives its revenues known as? A) Global business environment B) Economic environment C) Domestic business environment D) Technological environment E) Political-legal environment

Q: What is profit? A) Total money taken in by a corporation B) Increases in income from year to year C) Increases in a corporation's stock price D) Revenue generated by goods and services E) Difference between revenues and expenses

Q: 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

Q: Define offshore outsourcing and explain its pros and cons.

Q: (p. 410) __________ with other firms that have an interest in a possible innovation share the costs and risks associated with the effort. A. Acquisitions B. Joint strategy C. Joint ventures D. Mergers

Q: (p. 409) While ________ may under perform established products in mainstream markets, they often offer features or capabilities appreciated by some fringe customer group. A. Throughput technologies B. Acquired innovations C. Disruptive innovations D. Lagging innovations

Q: (p.408) Incremental business process innovations can: A. Generate less revenue gain, but higher cost savings than radical ones B. Generate more revenue gain or cost savings with less risk than radical ones C. Generate more risk but higher revenue gains than radical ones D. Generate more revenue gain and higher cost savings but with more risk than radical ones

Q: (p. 408) Tweaking a business process does not incur much: A. Technology risk B. Sales risk C. Cost D. Uncertainty

Q: (p. 408) Managers ask if they can retain existing customers and improve targeted coverage of existing and similar new customers, without innovation. Which of the following points about managing risk relates to this question? A. Get the most out of minimum innovation B. The point of innovation is growth C. Incremental product innovations can be particularly good at locking in existing customers D. Incremental innovations can generate more revenue gain or cost savings with less risk than radical ones

Q: (p. 408) ___________ is an idea factor involving following demographic and other broad trends and trying to develop ideas that may be relevant and useful. A. Mental invention B. Trend following C. Market research D. Solution spotting

Q: (p.408) _______ is an idea factor involving traditional research techniques to find ideas. A. Need spotting B. Mental invention C. Solution spotting D. Market research

Q: (p.407) _________ are serendipitous moments when innovators stumbled on something they were not looking for but immediately recognized its significance. A. Solution spottings B. Trend followings C. Market researches D. Random events

Q: (p. 407) __________ is an idea factor involving things dreamed up in the head with little reference to the outside world. A. Internal following B. Mental inventions C. Solution spotting D. Random events

Q: (p. 407) _________ is an idea factor involving finding a new way of using an existing technology. A. Trend following B. Need spotting C. Solution spotting D. Random events

Q: (p. 407) ________ is an idea factor involving actively looking for an answer to a known problem. A. Need spotting B. Market research C. Random events D. Trend following

Q: (p. 402) Breakthrough innovations are also called ______ innovations. A. CCC21 B. incremental C. sustaining D. disruptive

Q: (p. 405) A _____ technology is distinct from a disruptive technology. A. CCC21 B. breakthrough C. core D. sustaining

Q: (p. 405) A(n) ___________ is an innovation in a product, process, technology or the cost associated with it that represents a quantum leap forward in one or more of these ways. A. Breakthrough innovation B. Invention C. "Home-run" innovation D. Cost-improvement

Q: (p. 405) __________ are inherently more risky than ___________. A. Disruptive innovations; breakthrough innovations B. Incremental innovations; breakthrough innovations C. Breakthrough innovations; incremental innovation D. Functional innovations; process innovations

Q: (p. 402) The DMAIC (define, measure, analyze, improve, control) process is relevant to A. CCC21 B. Balanced scorecard C. Strategic matrix analysis D. Six Sigma

Q: (p. 402) ________ is a continuous improvement approach many companies have adopted to spur incremental innovation in their businesses. It is a very rigorous and analytical approach in quality and continuous improvement. A. CCC21 B. Balanced scorecard C. Strategic matrix analysis D. Six Sigma

Q: (p. 401) CCC21 stands for: A. Competitive Cost Competency in the 21st century B. Construction of Cost Competitiveness for the 21st century C. Cost Chain Competition for the 21st century D. Continuous Cost Competitiveness in the 21st century

Q: (p. 400) A major driver of ______ innovation in many companies the last several years has come from programs aimed at continuous improvement, cost reduction, and quality management. A. Breakthrough B. Disruptive C. Incremental D. Inventive

Q: (p. 400) _________, called kaizen in Japanese, is the process of relentlessly trying to find ways to improve and enhance a company's products and processes from design through assembly, sales and service. A. CCC21 B. Incremental innovation C. Continuous improvement D. Six Sigma

Q: (p. 400) ________ refers to simple changes or adjustments in existing products, services or processes. A. Continuous innovation B. Incremental innovation C. Process innovation D. Continuous improvement

Q: (p. 400) Which of the following is NOT a primary method of innovation? A. Competitive innovation B. Process innovation C. Service innovation D. Product innovation

Q: (p. 400) The iPod is an example of ____ innovation, while iTunes is an example of ______ innovation. A. product, process B. process, product C. product, service D. service, product

Q: (p. 400) __________ is turning ideas into profits. A. Improvement B. Process development C. Innovation D. Invention