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374 True/False questions

  1. Generally, the business cycle consists of four phases: the peak, recession, the trough, and recovery.
    True or False
    1. International organization of 153 nations dedicated to reducing or eliminating tariffs and other trade barriers

    2. Most-favored-nation status (MFN)—Each member of GATT was to be treated equally by all other members

    3. Kennedy Round, Tokyo Round, Uruguay Round, Doha Round

          

  2. Examine special types of corporations, including S-corporations, limited liability companies, and not-for-profit corporations....

          

  3. The ________ Act provides sweeping legislation for reporters of corporate misconduct.
    A- Consumer Product Safety Commission
    B- Federal Trade Commission
    C- Accountability and Transparency in Rating Agencies
    D- Sarbanes-Oxley
    E- American Recovery and Reinvestment
    North American Free Trade Agreement (NAFTA)
    Central American Free Trade Agreement -Dominican Republic(CAFTA-DR)
    Association of Southeast Asian Nations (ASEAN)
    European Economic Area (EEA)
    Pacific Rim
    Commonwealth of Independent States (CIS)
    Caribbean Basin Initiative (CBI)
    Common Market of the Southern Cone (MERCOSUR)
    Organization of Petroleum Exporting Countries (OPEC)
    Organization for Economic Cooperation and Development (OECD)

          

  4. Sherman Anti-trust Act (1890)Created the Federal Trade Commission to investigate illegal trade practices

          

  5. There are approximately ________ million nonfarm sole proprietorships in the United States.
    a. 32
    b. 40
    c. 23
    d. 55
    e. 12
    Advantages -
    1. Ease of start-up
    2. Pride of ownership
    3. Retention of all profits
    4. No special taxes
    5. Flexibility of being your own boss

    Disadvantages -
    1. Unlimited liability
    2. Lack of continuity
    3. Lack of money
    4. Limited management skills
    5. Difficulty in hiring employees

          

  6. Nobel laureate Milton Friedman refers to social responsibility programs as "hypocritical window-dressing". His belief supports which social responsibility philosophy?The economic model

          

  7. Economicsthe study of right and wrong and of the morality of the choices individuals make

          

  8. If the tiny country of Antigua & Barbuda imported $900 million worth of goods and services and exported $800 million worth, it would have a
    a. trade deficit of $100 million.
    b. balance of trade.
    c. trade surplus of $100 million.
    d. balance of payments of $100 million.
    e. favorable balance of trade
    Advantages -
    1. Ease of start-up
    2. Availability of capital and credit
    3. Personal interest
    4. Combined business skills and knowledge
    5. Retention of profits
    6. No special taxes

    Disadvantages -
    1. Unlimited liability
    2. Management disagreements
    3. Lack of continuity
    4. Frozen investment

          

  9. Balance of TradeThe total value of a nation's exports minus the total value of its imports over a specific period of time

          

  10. Federal deficita negative balance of trade

          

  11. trading companya negative balance of trade

          

  12. stakeholdersall the different people or groups of people who are affected by an organization's policies, decisions, and activities

          

  13. Define the methods by which a firm can organize for and enter into international markets.A firm can enter international markets in several ways. It may license a foreign firm to produce and market its products. It may export its products and sell them through foreign intermediaries or its own sales organization abroad, or it may sell its exports outright to an export-import merchant. It may enter into a joint venture with a foreign firm. It may establish its own foreign subsidiaries, or it may develop into a multinational enterprise.

    Generally, each of these methods represents an increasingly deeper level of involvement in international business, with licensing being the simplest and the development of a multinational corporation the most involved.

          

  14. A major disadvantage of sole proprietorships is that profits earned by a sole proprietorship are subject to the special state and federal income taxes that corporations pay.
    a. True
    b. False
    Advantages -
    1. Ease of start-up
    2. Pride of ownership
    3. Retention of all profits
    4. No special taxes
    5. Flexibility of being your own boss

    Disadvantages -
    1. Unlimited liability
    2. Lack of continuity
    3. Lack of money
    4. Limited management skills
    5. Difficulty in hiring employees

          

  15. domestic corporationa corporation whose stock can be bought and sold by any individual

          

  16. Export-Import Bank of the United Statesan independent agency of the U.S. government whose function is to assist in financing the exports of American firms

          

  17. Why are revenue tariffs levied?
    a. To generate income for the government
    b. To protect consumers of the product that the taxes are levied on
    c. To generate revenue for the importing company
    d. To generate revenue for the companies receiving the imported products
    e. To protect the importing company
    a. To generate income for the government

          

  18. common stockselling and shipping raw materials or products to other nations

          

  19. National IncomeThe total income earned by various segments of the population, including employees, self-employed individuals, corporations, and other types of income

          

  20. A grocery chain that directly purchases a portion of its products from outside the country rather than using an American distributor is engaging in international business.
    a. True
    b. False
    False

          

  21. Cultural norms can play a part in a person's ethical or unethical behavior in the workplace.
    True
    False
    1. Balance of Trade
    2. Bank Credit
    3. Corporate Profits
    4. Inflation Rate
    5. National Income
    6. New Housing Starts
    7. Prime Interest Rates

          

  22. Gross Domestic Product (GDP)
    The Total dollar value of all goods and services produced by all people within the boundaries of a country during a one-year period.

          

  23. ________ is our second largest export customer.
    a. Mexico
    b. Canada
    c. England
    d. Germany
    e. France
    a. True

          

  24. Producer Price Index (PPI)an international barter transaction

          

  25. dividenda distribution of earnings to the stockholders of a corporation

          

  26. The Wall Street Reform and Consumer Protection Act was passed in 2009.False

          

  27. New Housing Starts
    The organized effort of individuals to produce and sell, for a profit, the goods and services that satisfy society's needs

          

  28. Explain how ethical decision making can be encouraged.Governments, trade associations, and individual firms can establish guidelines for defining ethical behavior.
    1- Governments can pass stricter regulations.
    2- Trade associations provide ethical guidelines for their members.
    3-Companies provide codes of ethics—written guides to acceptable and ethical behavior as defined by an organization—and create an atmosphere in which ethical behavior is encouraged. 4-An ethical employee working in an unethical environment may resort to whistle-blowing to bring a questionable practice to light.

          

  29. General Agreement of Tariffs and Trade (GATT)1. International organization of 153 nations dedicated to reducing or eliminating tariffs and other trade barriers

    2. Most-favored-nation status (MFN)—Each member of GATT was to be treated equally by all other members

    3. Kennedy Round, Tokyo Round, Uruguay Round, Doha Round

          

  30. A sole proprietorship is usually operated by more than one person.
    a. True
    b. False
    False

          

  31. Airplanes manufactured by Boeing, cars manufactured by Nissan, and Kellogg's cereal are all examples ofRequired the Food and Drug Administration to review current food labeling and packaging focusing on nutrition label content, label format, ingredient labeling, food descriptors and standards, and health messages

          

  32. Product DifferentiationThe process of developing and promoting differences between one's products and all similar products

          

  33. letter of creditissued by a bank on request of an importer stating that the bank will pay an amount of money to a stated beneficiary

          

  34. GATT is headquartered in Washington D.C.
    a. True
    b. False
    False

          

  35. Discuss the restrictions nations place on international trade, the objectives of these restrictions, and their results.Ethical issues arise often in business situations out of relationships with investors, customers, employees, creditors, or competitors. Businesspeople should make every effort to be fair, to consider the welfare of customers and others within the firm, to avoid conflicts of interest, and to communicate honestly.

    1. Fairness & Honesty
    2. Organizational Relationships
    3. Conflict of Interests
    4. Communications

          

  36. alien corporationa corporation chartered by a foreign government and conducting business in the United States

          

  37. Capitalism
    An economic system in which individuals own and operate the majority of businesses that provide goods and services

    Derived from Adam Smith's laissez-faire capitalism

          

  38. Types of Economic Systems1. Perfect (or pure) competition
    2. Monopolistic competition
    3. Oligopoly
    4. Monopoly

          

  39. Studies show that the incidence of innovation among small-business workers is ________ than among workers in large businesses.Licensing
    A contractual agreement in which one firm permits another to produce and market its product and use its brand name in return for a royalty or other compensation

    Advantage
    -It allows expansion into foreign markets with little or no direct investment
    Disadvantages
    -The product image may be damaged if standards are not upheld
    -The original producer does not gain foreign marketing experience

          

  40. International business1. For help in choosing a career
    2. To be a successful employee
    3. To improve your management skills
    4. To start your own business
    5. To become a better informed consumer and investor

          

  41. Methods of Entering International Business:
    Multi-national Enterprise
    +Some countries are better equipped than others to produce particular goods or services
    --Absolute advantage
    --Comparative advantage

    +Goods and services are produced more efficiently when each country specializes in the products for which it has a comparative advantage

    +Countries trade when they each have a surplus of the product they specialize in and want a product the other country specializes in
    --Exporting
    --Importing

    +Balance of Trade
    +Trade Deficit
    +Balance of Payments

          

  42. foreign-exchange control
    The study of the decisions made by individuals and businesses

          

  43. Fair Debt Collection Practices Act (1977)Limited credit-card holder's liability to per card and stopped credit-card companies from issuing unsolicited cards

          

  44. Meat Inspection Act (1906)Eliminated many forms of price discrimination that gave large businesses a competitive advantage over smaller firms

          

  45. Summarize the CHALLENGES that American businesses will encounter in the future.A partnership formed to achieve a specific goal or to operate for a specific period of time

    Advantages
    -Immediate market knowledge and access
    -Reduced risk
    -Control over the product attributes

    Disadvantages
    -Complexity of establishing agreements across national borders
    -High level of commitment required of all parties involved

          

  46. board of directorsissued by a bank on request of an importer stating that the bank will pay an amount of money to a stated beneficiary

          

  47. Discuss the factors that affect the level of ethical behavior in organizations.Individual, social, and opportunity factors all affect the level of ethical behavior in an organization.
    1-Individual factors include knowledge level, moral values and attitudes, and personal goals.
    2-Social factors include cultural norms and the actions and values of co-workers and significant others.
    3-Opportunity factors refer to the amount of leeway that exists in an organization for employees to behave unethically if they choose to do so.

          

  48. One or more members of a board of directors are required for a corporation.
    a. True
    b. False
    a. True

          

  49. A way for the firm to grow is through the takeover of another firm.
    a. True
    b. False
    False

          

  50. All of the following are arguments for increased social responsibility except:
    A. socially responsible decision making by firms can prevent increased government intervention, which would force businesses to do what they fail to do voluntarily.
    B. by helping resolve social issues, business can create a more stable environment for long-term profitability
    C. social problems affect society in general, so individuals businesses should not be expected to solve these problems.
    D. business is a part of our society and therefore cannot ignore social issues.
    E. business has the technical, financial, and managerial resources needed to tackle today's complex social issues.
    C. social problems affect society in general, so individuals businesses should not be expected to solve these problems.

          

  51. Of the following factors, which is the least important in contributing to air pollution?
    A - Pollution emitted by individual homes
    B - Carbon Monoxide emitted by motor vehicles.
    C - Hydrocarbons emitted by motor vehicles
    D - The combination of weather and geography
    E - Smoke and other pollutants emitted by factories.
    c. The right to all profits

          

  52. Differences of Economic SystemsHow they answer the four basic economic questions
    -What goods and services will be produced?
    -How will they be produced?
    -For whom will they be produced?
    -Who owns and controls the major factors of production?

          

  53. Credit Card Accountability, Responsibility, and Disclosure Act (2009)Provided the most sweeping changes in credit card protections since the Truth in Lending Act of 1968

          

  54. Outline the extent of international business and the world economic outlook for trade.World trade is generally increasing. Trade between the United States and other nations is increasing in dollar value but decreasing in terms of our share of the world market. Exports as a percentage of U.S. GDP have increased steadily since 1985, except in the 2001 and 2008 recessions.

          

  55. S-corporationA general rise in the level of prices (EI)

          

  56. Magnuson-Moss Warranty-Federal Trade Commission Act (1975)Provided for minimum disclosure standards for written consumer-product warranties for products that cost more than $15

          

  57. The traditional concept that businesses are responsible to their investors and that social responsibility is someone else's job is the core of the
    a. corporate code of ethics.
    b. economic model of social responsibility.
    c. socioeconomic model of social responsibility.
    d. corporate model of social responsibility.
    e. doctrine of caveat emptor.
    False

          

  58. stockholderThe total of all federal deficits

          

  59. Import Duty (Tariff)a limit on the amount of a particular good that may be imported into a country during a given period of time

          

  60. general partnera person who assumes full or shared responsibility for operating a business

          

  61. Cigarette Labeling Act (1965)Required manufacturers to place standard warning labels on all cigarette packages and advertising

          

  62. If several hundreds of thousands of computers are sold on the domestic market for a ridiculously low price, what happens to the price of domestically produced computers?
    a. The price of domestic computers is driven down.
    b. The price of domestic computers can easily be raised by manufacturers.
    c. Nothing - the two are not necessarily related.
    d. The price of domestic computers will not change.
    e. The price easily doubles of domestic computers.
    ...

          

  63. Legally the sole proprietor of a business is the business.
    True
    False
    True

          

  64. Six Basic Rights to Consumers1. Right to Safety
    2. Right to be Informed
    3. Right to Choose
    4. Right to Be Heard
    5. Right to Consumer Education
    6. Right to Courteous Service

          

  65. Bushels of corn, wheat, or barley that have no unique characteristics are part of a perfect competition market.True

          

  66. multinational enterprisean agreement between two or more groups to form a business entity in order to achieve a specific goal or to operate for a specific period of time

          

  67. Banks are more open to lending money to sole proprietorship than to any other type of business.
    a. True
    b. False
    False

          

  68. foreign corporationa corporation in any state in which it does business except the one in which it is incorporated

          

  69. business ethicsthe study of right and wrong and of the morality of the choices individuals make

          

  70. not-for-profit corporationresources used to produce goods and services
    1. Land and natural resources
    2. Labor
    3. Capital
    4. Entrepreneurship

          

  71. When an economy is at its highest point and unemployment is low, the economy is in a peak period.True

          

  72. The courts of the U.S. have ruled that quotas in affirmative action programs are unconstitutional.
    True
    False
    True

          

  73. Describe how our current views on the social responsibility of business have evolved1. Recession
    2. Depression
    3. Monetary Policies

          

  74. Unemployment RatePercentage of a nation's labor force unemployed at any time (EI)

          

  75. Fair Credit Billing Act (1974)Required credit bureaus to provide credit reports to consumers regarding their own credit files; also provided for correction of incorrect information

          

  76. Describe the various sources of export assistance.Required warning labels on household chemicals if they were highly toxic

          

  77. Corporate OwnershipAn artificial person created by law with most of the legal rights of a real person, including the rights to start and operate a business, to buy or sell property, to borrow money, to sue or be sued, and to enter into binding contracts

    Unlike a real person, however, a corporation exists only on paper

    There are approximately 6 million corporations in the U.S.

    They comprise about 19 percent of all businesses, but they account for 83 percent of sales revenues

          

  78. Capitalism in the U.S.1. Mixed economy with elements of capitalism and socialism
    2. Households
    -- Consumers of goods and services
    -- Resource owners of some factors of production
    3. Businesses
    -- Produce goods and services to exchange for revenues (money)
    -- Use revenues to purchase factors of production
    4. Governments
    -- In exchange for taxes, governments provide public services that would not be provided by business or would be produced only for those who could afford them

          

  79. limited-liability company (LLC)a corporation chartered by a foreign government and conducting business in the United States

          

  80. Microeconomics
    The study of the decisions made by individuals and businesses

          

  81. International Economic Organizations Working to Foster Tradean international bank with 188 member nations that makes short-term loans to developing countries experiencing balance-of-payment deficits

          

  82. Economic Indicators (EI)a temporary association of individuals or firms organized to perform a specific task that requires a large amount of capital

          

  83. multilateral development bank (MDB)an internationally supported bank that provides loans to developing countries to help them grow

          

  84. Arguments against social responsibility
    the recognition that business activities have an impact on society and the consideration of that impact in business decision making

          

  85. Business ethics is the application of legal and regulatory standards to business situations.
    True
    False
    False

          

  86. Factory systempurchasing raw materials or products in other nations and bringing them into one's own country

          

  87. In a recent survey, the majority of employees surveyed assumed that their use of technology in the workplace is not monitored.False

          

  88. Free Enterprisea voluntary association of two or more persons to act as co-owners of a business for profit

    Less common form of ownership than sole proprietorship or corporation

    No legal limit on the maximum number of partners; most have only two

    Large accounting, law, and advertising partnerships have multiple partners

    Partnerships are usually a pooling of special talents or the result of a sole proprietor taking on a partner

          

  89. The ________ enlarged the solid-waste disposal program and provided for enforcement by the EPA....

          

  90. Federal Hazardous Substances Labeling Act (1960)Required warning labels on household chemicals if they were highly toxic

          

  91. Unemployment RateThe system through which a society creates and distributes wealth.

          

  92. A vertical merger occurs between firms that operate at different but related levels of production and marketing.
    a. True
    b. False
    Placed parents in control over what information is collected online from their children younger than 13 years; required commercial website operators to maintain the confidentiality, security, and integrity of personal information collected from children

          

  93. Which of the following is not a disadvantage of a corporation?
    a. Expense of formation
    b. Conflict within the corporation
    c. Increased paperwork
    d. Raising money
    e. Difficulty of formation
    Federal Trade Commission

          

  94. Protecting new or weak national industries is a reason to institute trade restrictions.
    True
    False
    A firm that operates on a worldwide scale without ties to any specific nation or region

          

  95. nontariff barriera non-tax measure imposed by a government to favor domestic over foreign suppliers

    Other Non-Tariff Barriers:
    *import quota
    *embargo
    *foreign exchange control
    *currency devaluation
    *bureaucratic red tape
    *cultural attitudes

          

  96. Which form of business has unlimited liability for all owners?
    a. sole proprietorship
    b. master limited partnership
    c. C-corporation
    d. closed corporation
    e. limited partnership
    Customers eventually find put which firms act responsibly and which do not.

          

  97. Truth in Lending Act (1968)Required manufacturers to place standard warning labels on all cigarette packages and advertising

          

  98. North American Free Trade Agreement (NAFTA)Prevented monopolies or mergers where competition was endangered

          

  99. The health of a nation's economy is actually quite unrelated to the amount of interest consumers pay for homes, automobiles, and credit card purchases.
    True or False
    Required warning labels on household chemicals if they were highly toxic

          

  100. In a socialist economy, the distribution of goods and services - who gets what - is controlled by the government however some smaller businesses may be privately owned. True or FalseTrue

          

  101. Federal Trade Commission Act (1914)1. Created in the Uruguay Round of GATT negotiation as a successor to GATT

    2. WTO oversees GATT provisions, has judicial powers to meditate trade disputes arising from GATT rules and exerts more binding authority than GATT

          

  102. Monopolistic competitionA market situation where there are many buyers along with a relatively larger number of sellers who differentiate their products from the products of competitors

          

  103. Social Audita comprehensive report of what an organization has done and is doing with regard to social issues that affect it

          

  104. Regulations and laws were much stricter in the first quarter of the twentieth century than they are now.
    True
    False
    Promoted the financial stability of the United States by improving accountability and responsibility in the financial system; established a new Consumer Financial Protection Agency to regulate home mortgages, car loans, and credit cards; became Public Law on July 21, 2010

          

  105. Which of the following is a false statement regarding limited-liability companies?
    a. An LLC enjoys pass-through taxation.
    b. LLCs are not recognized in all 50 states.
    c. An LLC is not restricted to 100 stockholders.
    d. The LLC type of organization provides more management flexibility when compared with corporations. (not d.)
    e. An LLC extends the concept of personal-asset protection to small business owners
    ...

          

  106. A joint venture can occur with a minimum of three groups or partners.
    a. True
    b. False
    False

          

  107. hostile takeovera situation in which the management and board of directors of a firm targeted for acquisition disapprove of the merger

          

  108. Supply
    The quantity of a product that PRODUCERS are willing to SELL at each of various prices

          

  109. Depression
    A general decrease in the level of prices

          

  110. MacroeconomicsThe study of the national economy and the global economy.

          

  111. Tips for Studying Businessthe chairman of the board, president, executive vice presidents, corporate secretary, treasurer, and any other top executive appointed by the board of directors

          

  112. A way for a firm to grow is through the takeover of another firm.
    a. True
    b. False
    False

          

  113. Fiscal Policya racial, religious, political, national, or other group regarded as different from the larger group of which it is a part and that is often singled out for unfavorable treatment

          

  114. limited partnera limit on the amount of a particular good that may be imported into a country during a given period of time

          

  115. Approximately 70% of U.S. production consists of goods and services purchased by individuals for personal or household consumption
    True or False
    True

          

  116. sustainabilitycreating and maintaining the conditions under which humans and nature can exist in productive harmony while fulfilling the social, economic, and other requirements of present and future generations

          

  117. Fair Packaging and Labeling Act (1966)Required the Food and Drug Administration to review current food labeling and packaging focusing on nutrition label content, label format, ingredient labeling, food descriptors and standards, and health messages

          

  118. Loans by the IMF are primarily provided to fund international trade.
    a. True
    b. False
    True

          

  119. Corporate officers are appointed by the board of directors.
    a. True
    b. False
    b. False

          

  120. Limited partners participate in day-to-day business activities and operations.
    a. True
    b. False
    ...

          

  121. The balance of trade includes imports, exports, investments, money spent by foreign tourists, and aid to foreign governments.
    True
    False
    Federal Trade Commission

          

  122. Entreprenueran agreement between two or more groups to form a business entity in order to achieve a specific goal or to operate for a specific period of time

          

  123. Analyze how present employment practices are being used to counteract past abuses.False

          

  124. A country's ________ is the total flow of money into a country minus the total flow of money out of the country over a period of time.
    a. favorable balance of trade
    b. balance of trade
    c. balance of payments
    d. comparative advantage
    e. trade deficit
    c. dividend.

          

  125. Exporting is selling and shipping raw materials or products to other states.
    True
    False
    False

          

  126. Sales RevenueTwo or more consecutive three-month periods of decline in a country's gross domestic product

          

  127. All banks are required to be national banks; it is against international regulations for banks to cross country borders.
    a. True
    b. False
    A firm that operates on a worldwide scale without ties to any specific nation or region

          

  128. Which of the following is the least likely option for funding a social responsibility program in a business?
    A- The federal government helps through tax reductions or other incentives.
    B- The costs are passed on to the consumer (no)
    C- The company absorbs the costs.
    D- Investors fund the program
    E- Costs are treated as a business expense.
    ...

          

  129. A multinational enterprise may operate in multiple countries but the business is based in one specific country.
    a. True
    b. False
    Ethical issues arise often in business situations out of relationships with investors, customers, employees, creditors, or competitors. Businesspeople should make every effort to be fair, to consider the welfare of customers and others within the firm, to avoid conflicts of interest, and to communicate honestly.

    1. Fairness & Honesty
    2. Organizational Relationships
    3. Conflict of Interests
    4. Communications

          

  130. hard-core unemployedA system of exchange in which goods or services are traded directly for other goods and/or services without using money

          

  131. Methods of Entering International Business:
    Strategic Alliances
    Partnerships formed to create competitive advantage on a worldwide basis

          

  132. stocka legal form listing issues to be decided at a stockholders' meeting and enabling stockholders to transfer their voting rights to some other individual or individuals

          

  133. closed corporationa corporation whose stock is owned by relatively few people and is not sold to the general public

          

  134. Natural monopolyAn industry requiring huge investments in capital and within which duplication of facilities would be wasteful and thus not in the public interest

          

  135. affirmative action programThe total income earned by various segments of the population, including employees, self-employed individuals, corporations, and other types of income

          

  136. When a firm is lacking financing, inventory, or time, it is dealing with issues of scarcity.
    True or False
    False

          

  137. E-Businessa temporary association of individuals or firms organized to perform a specific task that requires a large amount of capital

          

  138. Monetary PoliciesA shortfall created when the federal government spends more in a fiscal year than it receives

          

  139. Inflationa racial, religious, political, national, or other group regarded as different from the larger group of which it is a part and that is often singled out for unfavorable treatment

          

  140. Market Price (Equilibrium)
    The price at which the quantity demanded is exactly equal to the quantity supplied

          

  141. import quotaa limit on the amount of a particular good that may be imported into a country during a given period of time

          

  142. Types of Partners: General Partnersa business co-owned by two or more general partners who are liable for everything the business does

          

  143. sole proprietorshipA business that is owned (and usually operated) by one person

    The simplest form of business ownership and the easiest to start

    Many large businesses began as a small struggling sole proprietor ships

    The most popular form of business ownership

          

  144. Information is the resource that managers use to effectively combine human, financial, and material resources....

          

  145. balance of tradeprovides a link between buyers and sellers in different countries

          

  146. MDB stands for Monetarily-Developed Bank.False

          

  147. whistle-blowingpurchasing raw materials or products in other nations and bringing them into one's own country

          

  148. Amendments to the Equal Credit Opportunity Act (1976, 1994)Prevented discrimination based on race, creed, color, religion, age, and income when granting credit

          

  149. ProductivityThe average level of output per worker per hour

          

  150. SpecializationAn artificial person created by law with most of the legal rights of a real person, including the rights to start and operate a business, to buy or sell property, to borrow money, to sue or be sued, and to enter into binding contracts

    Unlike a real person, however, a corporation exists only on paper

    There are approximately 6 million corporations in the U.S.

    They comprise about 19 percent of all businesses, but they account for 83 percent of sales revenues

          

  151. mergerthe purchase of one corporation by another

          

  152. People do not simply buy goods and services to just own them; they buy goods and services to satisfy a specific need.False

          

  153. The vast majority of economists and financial analysts agree that mergers are good for the U.S. economy.
    a. True
    b. False
    Advantages -
    1. Ease of start-up
    2. Availability of capital and credit
    3. Personal interest
    4. Combined business skills and knowledge
    5. Retention of profits
    6. No special taxes

    Disadvantages -
    1. Unlimited liability
    2. Management disagreements
    3. Lack of continuity
    4. Frozen investment

          

  154. Saudi Arabia and Siberia enjoy an absolute advantage in the production of crude oil and petroleum products.
    True
    False
    True

          

  155. proxy fighta technique used to gather enough stockholder votes to control a targeted company

          

  156. Service Economyan artificial person created by law with most of the legal rights of a real person, including the rights to start and operate a business, to buy or sell property, to borrow money, to sue or be sued, and to enter into binding contracts

          

  157. Consumer Products
    Goods and Services purchased by individuals for personal consumption.

          

  158. The "Invisible Hand" was a term coined by Adam Smith.
    True or False
    May use an export/import merchant who assumes the risks of ownership, distribution, and sale

    Letter of credit -Issued by a bank on request of an importer stating that the bank will pay an amount of money to a stated beneficiary

    Bill of lading -Issued by a transport carrier to an exporter to prove merchandise has been shipped

    Draft -Issued by the exporter's bank, ordering the importer's bank to pay for the merchandise, thus guaranteeing payment once accepted by the importer's bank

    May use an export/import agent who arranges sale for a commission or fee; the exporter retains title to products until they are sold

    May establish own sales offices or branches in foreign countries

          

  159. Define economics and describe the two types of economic systems: capitalism and command economy.the concept that business should emphasize not only profits but also the impact of its decisions on society

    1. Business is dominated by the corporate form of ownership and the corporation is a creation of society. If a corp doesn't perform as a good citizen, society can and will demand changes.

    2. Many firms have begun to take pride in their social responsibility records, among them Starbucks Coffee, HP, Colgate/Palmolive, Coca Cola.

    3. Many business people believe that it is in their best interest to take the initiatives in this area. The alternative may be legal action brought against the firm by some special interest group; in such a situation the firm may lose control of its activities.

          

  160. Examine the different phases in the typical business cycle.The reasons for restricting trade range from internal political and economic pressures to mistrust of other nations.

    Nations are generally eager to export their products to provide markets for their industries and develop a favorable balance of trade.

    Most trade restrictions are applied to imports from other nations.

          

  161. economic communityan organization of nations formed to promote the free movement of resources and products among its members and to create common economic policies.

          

  162. Since we assume producers are rational people, we would expect them to offer more of a product at a higher price than to offer the product at a lower price.True

          

  163. Monopoly1. A market situation (or industry) in which there are few sellers (Ex. automobile manufacturers, car rental agencies, and farm implement industries)
    a) Sizable investments are required to enter into the market
    b). Each seller has considerable control over price
    c). The market actions of one seller can have a strong effect on competitors

          

  164. Factors Affecting Ethical BehaviorIndividual
    Social
    Opportunity

          

  165. Interstate Commerce Act (1887)Created the Federal Trade Commission to investigate illegal trade practices

          

  166. Material resources include sand, water, wood, dump trucks and computers.
    True or False
    True

          

  167. Which of the following is true about absolute advantages?
    a. No country has an absolute advantage.
    b. Absolute advantage is the ability to produce more of one product than any other country.
    c. Every country has an absolute advantage in some product.
    d. Absolute advantage is the ability to produce a particular product more efficiently than any other country.
    Absolute advantage is the ability to produce a particular product more efficiently than any other country.

          

  168. Which of the following is not a qualification for S-corporation status?
    a. No more than 12 stockholders
    b. Only one class of stock
    c. Individuals, estates, or certain trusts as stockholders.
    d. Decision agreed to by all stockholders.
    e. Must be a domestic corporation
    Collection agencies with harsh and abusive collection practices

          

  169. Describe the major types of pollution, their causes, and their cures.Water, Air, Land and Noise

    Industry has contributed to noise pollution and pollution of our land and water through the dumping of wastes, and to air pollution through vehicle and smokestack emissions.

    This contamination can be cleaned up and controlled, but the big question is: Who will pay? Present cleanup efforts are funded partly by government tax revenues, partly by business, and in the long run by consumers.

          

  170. Once a not-for-profit corporation is approved it must meet guidelines of the ______ to obtain tax-exempt status.
    a. registered state.
    b. Internal Revenue Service.
    c. Small Business Association.
    d. registered county.
    e. Small Business Development Center.
    b. Internal Revenue Service

          

  171. A New Century: 2000 and Beyond1. Technology becomes affordable
    2. Growth of service businesses (Service Economy)
    3. Although many economic indicators are strong, there is a feeling of pessimism, a large number of business failures, high unemployment, and terrorist threats

          

  172. The ____ for a particular product is the quantity that buyers are willing to purchase at each varying price.
    a. competition
    b. market price
    c. supply
    d. demand
    e. equilibrium
    d. Demand

          

  173. In the eyes of the law, the owner of a sole proprietorship and the business are one and the same.
    a. True
    b. False
    Advantages -
    1. Ease of start-up
    2. Pride of ownership
    3. Retention of all profits
    4. No special taxes
    5. Flexibility of being your own boss

    Disadvantages -
    1. Unlimited liability
    2. Lack of continuity
    3. Lack of money
    4. Limited management skills
    5. Difficulty in hiring employees

          

  174. A Latin phrase, caveat emptor, summarizes the vulnerable position that consumers were in the early 1900sTrue

          

  175. General Agreement on Tariffs and Trade (GATT)an international organization of 158 nations dedicated to reducing or eliminating tariffs and other barriers to world trade

          

  176. Sarbanes-Oxley Act of 2002A loose, subjective measure of how well off an individual or a society is mainly in terms of want satisfaction through goods and services

          

  177. Profit
    The quantity of a product that PRODUCERS are willing to SELL at each of various prices

          

  178. RecessionTwo or more consecutive three-month periods of decline in a country's gross domestic product

          

  179. Discuss international trade agreements and international economic organizations working to foster trade.1. International organization of 153 nations dedicated to reducing or eliminating tariffs and other trade barriers

    2. Most-favored-nation status (MFN)—Each member of GATT was to be treated equally by all other members

    3. Kennedy Round, Tokyo Round, Uruguay Round, Doha Round

          

  180. Restrictions to International Business+Some countries are better equipped than others to produce particular goods or services
    --Absolute advantage
    --Comparative advantage

    +Goods and services are produced more efficiently when each country specializes in the products for which it has a comparative advantage

    +Countries trade when they each have a surplus of the product they specialize in and want a product the other country specializes in
    --Exporting
    --Importing

    +Balance of Trade
    +Trade Deficit
    +Balance of Payments

          

  181. Identify the steps a business must take to implement a program of social responsibility.1-A program to implement social responsibility in a business begins with total commitment by top management.
    2-The program should be planned carefully, and a capable director should be appointed to implement it.
    3-Social audits should be prepared periodically as a means of evaluating and revising the program.
    4-Programs may be funded through price increases, reduction of profit, or federal incentives.

    1. Commitment of Top Executives
    2. Planning
    3. Appointment of a Director
    4. The Social Audit

          

  182. Corporations make up about ________ percent of all business and account for ________ of all sales revenues.
    a. 19; 82
    b. 32; 40
    c. 8; 50
    d. 5; 92
    e. 10; 90
    1. Recession
    2. Depression
    3. Monetary Policies

          

  183. A system of business where the key industries are owned and controlled by the government with private ownership of some business is known as capitalism.
    True or False
    False.

          

  184. general partnershipa business co-owned by two or more general partners who are liable for everything the business does

          

  185. When Maytag provides customers with a booklet describing how to use a washing machine, the company is satisfying the consumer bill of rights tobe informed

          

  186. Explain how growth from within and growth through mergers can enable a business to expand....

          

  187. Credit Card Liability Act (1970)Limited credit-card holder's liability to per card and stopped credit-card companies from issuing unsolicited cards

          

  188. draftissued by the exporter's bank, ordering the importer's bank to pay for the merchandise, thus guaranteeing payment once accepted by the importer's bank

          

  189. A local bank just completed its social audit for the past year. Which statement indicates a valid attempt at responding to social responsibility by the bank?
    a. One white female was promoted to CEO.
    b. A reward system encourages all employees to market the bank's products and services.
    c. Each employee completed at least 200 hours of service to community functions.
    d. This year marked an increase of 100 percent in the number of depositors.
    e. The loan department expanded services to small businesses.
    consumerism

          

  190. Financing International Business:
    Multilateral Development Bank (MDB)
    A partnership formed to achieve a specific goal or to operate for a specific period of time

    Advantages
    -Immediate market knowledge and access
    -Reduced risk
    -Control over the product attributes

    Disadvantages
    -Complexity of establishing agreements across national borders
    -High level of commitment required of all parties involved

          

  191. strategic alliancecreating and maintaining the conditions under which humans and nature can exist in productive harmony while fulfilling the social, economic, and other requirements of present and future generations

          

  192. Types of CompetitionImport Duty (Tariff)
    Dumping
    Non-Tariff Barriers

          

  193. Non-profit laws are only federal and thus, the same laws exist in all fifty states.
    a. True
    b. False
    True

          

  194. Fairness is considered an important ethical concern in business.True

          

  195. Small businesses generally only issue common stock.
    a. True
    b. False
    True

          

  196. Which of the following types of business ownership is the easiest to start?
    a. Corporation
    b. Master limited partnership
    c. Sole proprietorship
    d. General partnership
    e. Limited partnership
    a. No more than 12 stockholders

          

  197. absolute advantageA system of exchange in which goods or services are traded directly for other goods and/or services without using money

          

  198. Trade restrictions are applied to products exported to other countries more often than to imports.
    a. True
    b. False
    The reasons for restricting trade range from internal political and economic pressures to mistrust of other nations.

    Nations are generally eager to export their products to provide markets for their industries and develop a favorable balance of trade.

    Most trade restrictions are applied to imports from other nations.

          

  199. Two Views of Social Responsibilitythe top governing body of a corporation, the members of which are elected by the stockholders

          

  200. code of ethicsstock owned by individuals or firms who may vote on corporate matters but whose claims on profits and assets are subordinate to the claims of others

          

  201. Current Business EnvironmentThe competitive, global, technological, and economic environments affect business today

          

  202. Clayton Anti-Trust Act (1914)Eliminated many forms of price discrimination that gave large businesses a competitive advantage over smaller firms

          

  203. World Trade Organization (WTO)1. Created in the Uruguay Round of GATT negotiation as a successor to GATT

    2. WTO oversees GATT provisions, has judicial powers to meditate trade disputes arising from GATT rules and exerts more binding authority than GATT

          

  204. The World Economic Outlook for TradeEconomic performance among nations is not equal; growth in advanced countries slowed and then stopped in 2009, while emerging and developing economies continue to grow rapidly

    International experts expected global economic growth in 2010 and 2011, despite the high oil prices

    Canada and Western Europe
    --Canada is projected to show growth in 2010 and 2011
    --Euro area is expected to grow in 2011
    --U.K. and smaller European countries are expected to experience a recession

    Mexico and Latin America
    --Mexico is expected to show growth in 2010 and 2011
    --Latin America and Caribbean economies are recovering at a robust pace

    Japan
    --Projected to show growth in 2010 and 2011

    Other Asian Countries
    --Lead by China emerging as a global economic power, growth is strong
    --Key emerging economies is Asia are leading the global recovery

    Emerging Europe
    --Growth has been faster than in western Europe and continued growth is expected in 2010 and 2010

    Commonwealth of Independent States
    --Projected to show growth in 2010 and 2011
    --With the collapse of communism, trade between the U.S. and central and Eastern Europe expanded substantially

    Exports and the U.S. Economy
    --In 2008, exports as a percentage of GDP reached its highest level since 1916
    --In the past 50 years, exports have become increasingly important to the U.S. economy

          

  205. Methods of Entering International Business:
    Licensing
    Licensing
    A contractual agreement in which one firm permits another to produce and market its product and use its brand name in return for a royalty or other compensation

    Advantage
    -It allows expansion into foreign markets with little or no direct investment
    Disadvantages
    -The product image may be damaged if standards are not upheld
    -The original producer does not gain foreign marketing experience

          

  206. If you earn 90 cents for each stock share that you own in XYZ corporation, you have earned a
    a. tender offer.
    b. cooperative.
    c. dividend.
    d. proxy.
    e. stock share.
    c. dividend.

          

  207. Discuss what you must do to be successful in the world of business.True

          

  208. Kefauver-Harris Drug Amendments (1962)Provided for limited supervision of interstate sales of meat and meat products

          

  209. consumerismall activities undertaken to protect the rights of consumers

          

  210. unlimited liabilitya limit on the amount of a particular good that may be imported into a country during a given period of time

          

  211. Perfect (or pure) competitionthe reduction of the value of a nation's currency relative to the currencies of other countries

          

  212. Do Not Call Implementation Act (2003)1. Rapid growth of large industries (automobiles, steel, oil, chemical) and the mass production of consumer goods
    2. The Roaring Twenties ended with the 1929 stock market crash
    3. Government intervention became necessary to get the economy moving again
    4. In the last part of the 1900s, a large number of business failures and declining stock values suggested larger economic problems to come

          

  213. A responsibility audit is a comprehensive report of what an organization is going to do in regard to social issues.trade deficit of $100 million.

          

  214. It can be said that the United States has an absolute advantage in research and development as well as high-technology.
    a. True
    b. False
    False

          

  215. corporate officersthe chairman of the board, president, executive vice presidents, corporate secretary, treasurer, and any other top executive appointed by the board of directors

          

  216. economic model of social responsibility
    the recognition that business activities have an impact on society and the consideration of that impact in business decision making

          

  217. Methods of Entering International Business:
    Totally Owned Facilities
    Partnerships formed to create competitive advantage on a worldwide basis

          

  218. Early business development1. Barter System
    2. Domestic System
    3. Factory System
    4. Specialization

          

  219. importingissued by the exporter's bank, ordering the importer's bank to pay for the merchandise, thus guaranteeing payment once accepted by the importer's bank

          

  220. Domestic systemA system of exchange in which goods or services are traded directly for other goods and/or services without using money

          

  221. Relationships with customers are not known to cause ethical problems for businesses.
    True
    False
    False

          

  222. Gross Domestic Product (GDP)The total value of all goods and services produced by all people within the boundaries of a country during a one-year period. (EI)

          

  223. Summarize the FACTORS that affect the business environment that American businesses will encounter in the future.1. Have a dream—know what you want
    2. Adapt to changes in the environment—work hard to turn your dreams into reality

          

  224. That the consumer was entitled to a "bill of rights" was instituted by President
    A- Nixon
    B- Clinton
    C- George W. Bush
    D- Kennedy
    E- Ford
    D- Kennedy

          

  225. EconomyThe system through which a society creates and distributes wealth.

          

  226. Discuss the factors that led to the consumer movement and list some of its results....

          

  227. Consumer Price Index (CPI)A monthly index that measures the changes in prices of a fixed basket of goods purchased by a typical consumer in an urban area

          

  228. Discuss the purpose of a joint venture and syndicate.the view that society will benefit most when business is left alone to produce and market profitable products that society needs.

    Managers who adopts this attitude, social responsibility is someone else's job. Social Responsibility becomes the problem of the government, various environmental groups, charitable foundations, and similar organizations.

          

  229. comparative advantagean economic system in which businesses and individuals decide what to produce and buy, and the market determines quantities sold and prices

          

  230. Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010Required the Food and Drug Administration to review current food labeling and packaging focusing on nutrition label content, label format, ingredient labeling, food descriptors and standards, and health messages

          

  231. licensinga contractual agreement in which one firm permits another to produce and market its product and use its brand name in return for a royalty or other compensation

          

  232. countertradean international barter transaction

          

  233. proxythe shares of ownership of a corporation

          

  234. Equal Credit Opportunity Act (1974)Provided equal credit opportunities for males and females and for married and single individuals

          

  235. CorporationsA general rise in the level of prices (EI)

          

  236. Telephone Consumer Protection Act (1991)Prohibited the use of automated dialing and prerecorded-voice calling equipment to make calls or deliver messages

          

  237. Which of the following acts involving protecting the environment in some way is the most recent?
    A - Oil Pollution Act
    B - American Recovery & Reinvestment Act
    C - Food Quality Protection Act
    D - Resource Conservation & Recovery Act
    E - Clean Air Amendment
    B - American Recovery & Reinvestment Act

          

  238. Shares of ownership of a corporation are called stock.
    a. True
    b. False
    a. True

          

  239. Manufacturers in the auto industry operate in a monopoly setting.False

          

  240. Which of the following is false about business and social responsibility in the first quarter of the twentieth century?
    A- No minimum wage laws existed
    B- Industrial accents were commonplace and nearly expected
    C- The average work week was approx 40 hours
    D- Working conditions where were considered deplorable by today's standards.
    E- Work areas were often crowded and unsafe.
    Fair Packaging and Labeling Act

          

  241. Summarize how a corporation is formed.1. Perfect (or pure) competition
    2. Monopolistic competition
    3. Oligopoly
    4. Monopoly

          

  242. Identify the institutions that help firms and nations finance international business.Brunei
    Myanmar
    Cambodia
    Indonesia
    Laos
    Malaysia
    Philippines
    Singapore
    Thailand
    Vietnam

          

  243. balance of paymentsthe total flow of money into a country minus the total flow of money out of that country over some period of time.

          

  244. Describe the advantages and disadvantages of sole proprietorships.Advantages -
    1. Ease of start-up
    2. Pride of ownership
    3. Retention of all profits
    4. No special taxes
    5. Flexibility of being your own boss

    Disadvantages -
    1. Unlimited liability
    2. Lack of continuity
    3. Lack of money
    4. Limited management skills
    5. Difficulty in hiring employees

          

  245. Methods of Entering International Business:
    Exporting
    Partnerships formed to create competitive advantage on a worldwide basis

          

  246. Describe the advantages and disadvantages of partnerships.Many government and international agencies provide export assistance to U.S. and foreign firms. Sources of export assistance include U.S. Export Assistance Centers, the International Trade Administration, U.S. and Foreign Commercial Services, Export Legal Assistance Network, Advocacy Center, National Trade Data Bank, and other government and international agencies.

          

  247. sole proprietorship - disadvantagesa partnership formed to create competitive advantage on a worldwide basis

          

  248. Guidelines for Making Ethical Decisions① Prepare before you go to class.
    ② Read the chapter.
    ③ Underline or highlight important concepts.
    ④ Take notes.
    ⑤ Apply the concepts.
    ⑥ Practice critical thinking.
    ⑦ Prepare for exams.

          

  249. For more than fifty years, women's salaries have consistently been only about ___ for each dollar earned compared to men's.
    A. 84
    B. 82
    C. 91
    D. 77
    E. 62
    False

          

  250. tender offeran offer to purchase the stock of a firm targeted for acquisition at a price just high enough to tempt stockholders to sell their shares

          

  251. Business CycleThe recurrence of periods of growth and recession in a nation's economic activity.

          

  252. International Monetary Fund (IMF)
    Federal Reserve's decisions that determine the size of the supply of money in the nation and the level of interest rate.

          

  253. Approximately 45% of small businesses fail within the first seven years.
    True or False
    False

          

  254. joint venturethe online interaction that allows people and businesses to communicate and share ideas, personal information, and information about products or services

          

  255. Arguments for increased social responsibility1-Because business is a part of our society, it cannot ignore social issues.
    2-Business has the technical, financial, and managerial resources needed to tackle today's complex social issues.
    3-By helping resolve social issues, business can create a more stable environment for long-term profitability.
    4-Socially responsible decision making by firms can prevent increased government intervention, which would force businesses to do what they fail to do voluntarily.

          

  256. Social ResponsibilityGovernment influence on the amount of savings and expenditures; accomplished by altering the tax structure and by changing the levels of government spending

          

  257. CompetitionRivalry among businesses for sales to potential customers.

          

  258. Methods of Entering International Business:
    Countertrade
    --An international barter transaction

    --Avoids restrictions on converting domestic currency to foreign currency

          

  259. Monetary Policies
    Federal Reserve's decisions that determine the size of the supply of money in the nation and the level of interest rate.

          

  260. One risk of licensing is the possibility that licensees may not adhere to quality standards required and expected by the licensing company.
    a. True
    b. False
    ...

          

  261. Describe the advantages and disadvantages of a corporation.Created the Federal Trade Commission to investigate illegal trade practices

          

  262. Noise pollution might be addressed by workers being required to wear earplugs to guard against hearing damage.False

          

  263. Factors of Productionresources used to produce goods and services
    1. Land and natural resources
    2. Labor
    3. Capital
    4. Entrepreneurship

          

  264. The EEOC has the power to investigate complaints of employment discrimination and can sue firms that practice discrimination.Many government and international agencies provide export assistance to U.S. and foreign firms. Sources of export assistance include U.S. Export Assistance Centers, the International Trade Administration, U.S. and Foreign Commercial Services, Export Legal Assistance Network, Advocacy Center, National Trade Data Bank, and other government and international agencies.

          

  265. World Trade Organization (WTO)An artificial person created by law with most of the legal rights of a real person, including the rights to start and operate a business, to buy or sell property, to borrow money, to sue or be sued, and to enter into binding contracts

    Unlike a real person, however, a corporation exists only on paper

    There are approximately 6 million corporations in the U.S.

    They comprise about 19 percent of all businesses, but they account for 83 percent of sales revenues

          

  266. Which of the following is not considered a step in developing and implementing a social responsibility program in a company?
    A - Planning the Program
    B - Preparing a social audit
    C - Incorporating "buy-in" from all employees
    D - Appointing a director
    E - Securing the commitment of top executives
    Incorporating "buy-in" from all employees

          

  267. Methods of Entering International Business:
    Trading companies
    +Some countries are better equipped than others to produce particular goods or services
    --Absolute advantage
    --Comparative advantage

    +Goods and services are produced more efficiently when each country specializes in the products for which it has a comparative advantage

    +Countries trade when they each have a surplus of the product they specialize in and want a product the other country specializes in
    --Exporting
    --Importing

    +Balance of Trade
    +Trade Deficit
    +Balance of Payments

          

  268. Types of Trade Restrictions1. Economics
    2. Microeconomics
    3. Macroeconomics
    4. Economy

          

  269. minoritya legal form listing issues to be decided at a stockholders' meeting and enabling stockholders to transfer their voting rights to some other individual or individuals

          

  270. Socioeconomic model of social responsibility1-Business managers are responsible primarily to stockholders, so management must be concerned with providing a return on owners' investments.
    2-Corporate time, money, and talent should be used to maximize profits, not to solve society's problems.
    3-Social problems affect society in general, so individual businesses should not be expected to solve these problems.
    4-Social issues are the responsibility of government officials who are elected for that purpose and who are accountable to the voters for their decisions.

          

  271. dumpingexportation of large quantities of a product at a price lower than that of the same product in the home market.

          

  272. Outline the four types of competition.
    The market situation in which there are many buyers and sellers of a product and no single buyer or seller is powerful enough to affect the price of that product.

          

  273. Legal monopoly (limited monopoly)A monopoly created when a government entity issues a franchise, license, copyright, patent, or trademark protecting the owners of written materials, ideas, or product brands from unauthorized use by competitors

          

  274. Identify the types of ethical concerns that arise in the business world.Many government and international agencies provide export assistance to U.S. and foreign firms. Sources of export assistance include U.S. Export Assistance Centers, the International Trade Administration, U.S. and Foreign Commercial Services, Export Legal Assistance Network, Advocacy Center, National Trade Data Bank, and other government and international agencies.

          

  275. If only 100,000 tons of beef is allowed to enter the U.S. borders, the U.S. government has instituted a(n)
    a. trade embargo.
    b. import quota.
    c. devaluation.
    d. balance of trade.
    e. foreign-exchange control.
    Each employee completed at least 200 hours of service to community functions.

          

  276. Why study business?the organized effort of individuals to produce and sell through the Internet, for a profit, products and services that satisfy society's needs--became an accepted method of conducting business

          

  277. Financing International Business:
    The Export-Import Bank of the United States (Eximbank)
    An independent agency of the U.S. government whose function it is to assist in financing the exports of American firms

          

  278. There are approximately ________ partnerships in the United States.
    a. 3 million
    b. 3.8 million
    c. 750,000
    d. 975,000
    e. 2 million
    a. 3 million

          

  279. Prime Interest RateThe lowest interest rate that banks charge their most creditworthy customers

          

  280. Pure Food and Drug Act (1906)Prevented monopolies or mergers where competition was endangered

          

  281. If a company's sales are higher than its expenses, the company has earned what is known as revenue.
    True or False
    Brunei
    Myanmar
    Cambodia
    Indonesia
    Laos
    Malaysia
    Philippines
    Singapore
    Thailand
    Vietnam

          

  282. Children's Online Privacy Protection Act (2000)Placed parents in control over what information is collected online from their children younger than 13 years; required commercial website operators to maintain the confidentiality, security, and integrity of personal information collected from children

          

  283. social mediathe online interaction that allows people and businesses to communicate and share ideas, personal information, and information about products or services

          

  284. A partnership can have a legal limit of no more than 12 partners.
    a. True
    b. False
    False

          

  285. Most businesses incorporate in the states where they do most of their business.
    a. True
    b. False
    True

          

  286. Corporate ProfitsStock - The shares of ownership of a corporation

    Stockholder - A person who owns a corporation's stock

    Closed corporation - A corporation whose stock is owned by relatively few people and is not sold to the general public

    Open corporation - A corporation whose stock is bought and sold on security exchanges and can be purchased by any individual

          

  287. Ethicsthe study of right and wrong and of the morality of the choices individuals make

          

  288. Exporting is considered simpler than licensing.
    a. True
    b. False
    A partnership formed to achieve a specific goal or to operate for a specific period of time

    Advantages
    -Immediate market knowledge and access
    -Reduced risk
    -Control over the product attributes

    Disadvantages
    -Complexity of establishing agreements across national borders
    -High level of commitment required of all parties involved

          

  289. preferred stockstock owned by individuals or firms who may vote on corporate matters but whose claims on profits and assets are subordinate to the claims of others

          

  290. cultural (or workplace) diversity1. Perfect (or pure) competition
    2. Monopolistic competition
    3. Oligopoly
    4. Monopoly

          

  291. Which of the following is not a right of corporations?
    a. The right to buy property
    b. The right to start a business
    c. The right to all profits
    d. The right to sue
    e. The right to enter into a contract
    c. The right to all profits

          

  292. Deflation
    A general decrease in the level of prices

          

  293. currency devaluationthe reduction of the value of a nation's currency relative to the currencies of other countries

          

  294. Misleading advertising in print or television is illegal as well as unethical.A partnership formed to achieve a specific goal or to operate for a specific period of time

    Advantages
    -Immediate market knowledge and access
    -Reduced risk
    -Control over the product attributes

    Disadvantages
    -Complexity of establishing agreements across national borders
    -High level of commitment required of all parties involved

          

  295. Bank Credita negative balance of trade

          

  296. Explain the different types of partners and the importance of partnership agreements....

          

  297. Forming a Corporation
    Federal Reserve's decisions that determine the size of the supply of money in the nation and the level of interest rate.

          

  298. A reason against trade restrictions is the higher prices that consumers have to pay.
    True
    False
    True

          

  299. open corporationa corporation whose stock can be bought and sold by any individual

          

  300. Which of the following government agencies issues guidelines on the use of labeling that advertisers have an obligation to follow?
    A. Fair Packaging and Labeling Act
    B. Clayton Antitrust Act
    C. Sherman Antitrust Act
    D. Federal Trade Commission
    E. Pure Food and Drug Act
    C- The average work week was approx 40 hours

          

  301. Standard of livingA loose, subjective measure of how well off an individual or a society is mainly in terms of want satisfaction through goods and services

          

  302. Caveat Emptorthe online interaction that allows people and businesses to communicate and share ideas, personal information, and information about products or services

          

  303. Barter systemTwo or more consecutive three-month periods of decline in a country's gross domestic product

          

  304. Most corporations grow by expanding their own present operations.
    a. True
    b. False
    a. True

          

  305. The Interstate Commerce Act was the first federal act to regulate business practices.
    True
    False
    Although the worldwide recessions of 1991 and 2001-2002 slowed the rate of growth, and 2008-2009 global economic crisis caused the sharpest decline in more than 70 years, globalization is a reality of our time

    In the U.S., international trade accounts for over ¼ of GDP

    Trade barriers are decreasing, new competitors are entering the global marketplace, creating more choices for consumers and new job opportunities

    International business will grow with the expansion of commercial use of the Internet

          

  306. Equal Employment Opportunity Commission (EEOC)The percentage of a nation's labor force unemployed at any time.

          

  307. Financing International Business:
    The International Monetary Fund (IMF)
    An internationally supported bank that provides loans to developing countries to help them grow

    World Bank, Inter-American Development Bank (IDB), Asian Development Bank (ADB), African Development Bank (AFDB), European Bank for Reconstruction and Development (EBRD)

          

  308. The Clean Air Amendments, the Water Pollution Control Act Amendment, and the National Environmental Policy Act were all instituted in the
    A. 1990s
    B. 1980s
    C. 1960s
    D. 1970s
    Water, Air, Land and Noise

    Industry has contributed to noise pollution and pollution of our land and water through the dumping of wastes, and to air pollution through vehicle and smokestack emissions.

    This contamination can be cleaned up and controlled, but the big question is: Who will pay? Present cleanup efforts are funded partly by government tax revenues, partly by business, and in the long run by consumers.

          

  309. Understand what is meant by business ethics.Although the worldwide recessions of 1991 and 2001-2002 slowed the rate of growth, and 2008-2009 global economic crisis caused the sharpest decline in more than 70 years, globalization is a reality of our time

    In the U.S., international trade accounts for over ¼ of GDP

    Trade barriers are decreasing, new competitors are entering the global marketplace, creating more choices for consumers and new job opportunities

    International business will grow with the expansion of commercial use of the Internet

          

  310. Consumer Credit Reporting Reform Act (1997)Placed more responsibility for accurate credit data on credit issuers; required creditors to verify that disputed data are accurate and to notify a consumer before reinstating the data

          

  311. National debta person who owns a corporation's stock

          

  312. Consumer Product Safety Commission Act (1972)Established an abbreviated procedure for registering certain generic drugs

          

  313. Mixed Economyan economy that exhibits elements of both capitalism and socialism

          

  314. Adam Smith's laissez-faire capitalismA market situation where there are many buyers along with a relatively larger number of sellers who differentiate their products from the products of competitors

          

  315. The Partnership AgreementA system of exchange in which goods or services are traded directly for other goods and/or services without using money

          

  316. Nutrition Labeling and Education Act (1990)Required the Food and Drug Administration to review current food labeling and packaging focusing on nutrition label content, label format, ingredient labeling, food descriptors and standards, and health messages

          

  317. The ability to deal effectively with individual employees as well as other managers and people outside the organization are known as conceptual skillsFalse

          

  318. Inflation RateAn economic statistic that tracks the increase in prices of goods and services over a period of time; usually calculated on a monthly or annual basis

          

  319. All of the following are rights of the consumer bill of rights except
    A. The right to choose
    B. The right to be informed
    C. the right to personalized service
    D. the right to courteous service
    C. the right to personalized service

          

  320. Central American Free Trade Agreement -Dominican Republic(CAFTA-DR)El Salvador
    Guatemala
    Honduras
    Nicaragua
    Dominican Republic
    Costa Rica

          

  321. Motor Vehicle Safety Act (1966)Established standards for safer cars

          

  322. Which of the following is least likely to be an economic consequence of trade restrictions?
    a. Restrictions in consumers' choices
    b. Higher prices for consumers
    c. Loss of jobs
    d. Misallocation of international resources
    e. Protection of the health of citizens
    c. Loss of jobs

          

  323. Despite the global recession, economic growth in Asia remained strong in 2011 and 2012.
    a. True
    b. False
    Economic performance among nations is not equal; growth in advanced countries slowed and then stopped in 2009, while emerging and developing economies continue to grow rapidly

    International experts expected global economic growth in 2010 and 2011, despite the high oil prices

    Canada and Western Europe
    --Canada is projected to show growth in 2010 and 2011
    --Euro area is expected to grow in 2011
    --U.K. and smaller European countries are expected to experience a recession

    Mexico and Latin America
    --Mexico is expected to show growth in 2010 and 2011
    --Latin America and Caribbean economies are recovering at a robust pace

    Japan
    --Projected to show growth in 2010 and 2011

    Other Asian Countries
    --Lead by China emerging as a global economic power, growth is strong
    --Key emerging economies is Asia are leading the global recovery

    Emerging Europe
    --Growth has been faster than in western Europe and continued growth is expected in 2010 and 2010

    Commonwealth of Independent States
    --Projected to show growth in 2010 and 2011
    --With the collapse of communism, trade between the U.S. and central and Eastern Europe expanded substantially

    Exports and the U.S. Economy
    --In 2008, exports as a percentage of GDP reached its highest level since 1916
    --In the past 50 years, exports have become increasingly important to the U.S. economy

          

  324. The Extent of International Business1. Economics
    2. Microeconomics
    3. Macroeconomics
    4. Economy

          

  325. Major events that shaped the nation's economy between 1940 and 2000 include:...

          

  326. sole proprietorship - advantagesthe ability to produce a specific product more efficiently than any other nation

          

  327. Types of Partners: Limited Partners1. Perfect (or pure) competition
    2. Monopolistic competition
    3. Oligopoly
    4. Monopoly

          

  328. exportingselling and shipping raw materials or products to other nations

          

  329. What is Social Responsibility good for business?Customers eventually find put which firms act responsibly and which do not.

          

  330. By ensuring that products are safe and reliable, the Food and Drug Administration and the Consumer Product Safety Commission are taking part in a movement known as
    a. protectionism.
    b. product activism.
    c. socialism.
    d. product liability management.
    e. consumerism.
    consumerism

          

  331. Common Measures Used to Evaluate a Nation's Economic Health...

          

  332. Loss (negative profit)Results when a firm's expenses are greater than its revenues

          

  333. Perfect (or Pure) competition
    The market situation in which there are many buyers and sellers of a product and no single buyer or seller is powerful enough to affect the price of that product.

          

  334. Methods of Entering International Business:
    Joint Ventures
    A partnership formed to achieve a specific goal or to operate for a specific period of time

    Advantages
    -Immediate market knowledge and access
    -Reduced risk
    -Control over the product attributes

    Disadvantages
    -Complexity of establishing agreements across national borders
    -High level of commitment required of all parties involved

          

  335. Business Development in the 1900s1. Rapid growth of large industries (automobiles, steel, oil, chemical) and the mass production of consumer goods
    2. The Roaring Twenties ended with the 1929 stock market crash
    3. Government intervention became necessary to get the economy moving again
    4. In the last part of the 1900s, a large number of business failures and declining stock values suggested larger economic problems to come

          

  336. corporationan artificial person created by law with most of the legal rights of a real person, including the rights to start and operate a business, to buy or sell property, to borrow money, to sue or be sued, and to enter into binding contracts

          

  337. BusinessThe recurrence of periods of growth and recession in a nation's economic activity.

          

  338. Best Buy, an electronics retailer, could be considered a marketing intermediary.International business encompasses all business activities that involve exchanges across national boundaries. International trade is based on specialization, whereby each country produces the goods and services that it can produce more efficiently than any other goods and services. A nation is said to have a comparative advantage relative to these goods. International trade develops when each nation trades its surplus products for those in short supply.

    A nation's balance of trade is the difference between the value of its exports and the value of its imports. Its balance of payments is the difference between the flow of money into and out of the nation. Generally, a negative balance of trade is considered unfavorable.

          

  339. DemandThe system through which a society creates and distributes wealth.

          

  340. Sources of Export Assistanceissued by a bank on request of an importer stating that the bank will pay an amount of money to a stated beneficiary

          

  341. invisible hand
    The organized effort of individuals to produce and sell, for a profit, the goods and services that satisfy society's needs

          

  342. Identify the ways to measure economic performance.1. Productivity
    2. Economic Indicators

          

  343. Which of the following examples is least likely to be covered by federal legislation passed in the 1960s?
    a. Collection agencies with harsh and abusive collection practices
    b. Boxes of cereal with net weight and manufacturer contact information
    c. Bathroom cleaners with warning labels
    d. A list of ingredients for your favorite ice cream
    e. Cigarette magazine advertising that offers health warnings
    Collection agencies with harsh and abusive collection practices

          

  344. Double taxation is a drawback of corporation business ownership.
    a. True
    b. False
    a. True

          

  345. The Inter-American Development Bank focuses on helping developing countries grow.
    a. True
    b. False
    True

          

  346. Association of Southeast Asian Nations (ASEAN)Ease of start-up
    Pride of ownership
    Retention of all profits
    No special taxes
    Flexibility of being your own boss

          

  347. Command Economies
    The study of the decisions made by individuals and businesses

          

  348. Fair Credit Reporting Act (1971)Required credit bureaus to provide credit reports to consumers regarding their own credit files; also provided for correction of incorrect information

          

  349. bill of ladingA statistic that measures the lending activity of commercial financial institutions

          

  350. Major Environmental LawsNational Environmental Policy Act (1970)
    Clean Air Amendment (1970)
    Water Quality Improvement Act (1970)
    Resource Recovery Act (1970)
    Water Pollution Control Act Amendment (1972)
    Noise Control Act (1972)
    Clean Air Act Amendment (1977)
    Resource Conservation and Recovery Act (1984)
    Clean Air Act Amendment (1987)
    Oil Pollution Act (1990)
    Clean Air Act Amendments (1990)
    Food Quality Protection Act (1996)
    American Recovery and Reinvestment Act (2009)

          

  351. limited liabilitya feature of corporate ownership that limits each owner's financial liability to the amount of money that he or she has paid for the corporation's stock

          

  352. trade deficita negative balance of trade

          

  353. The NAFTA agreement includes the United States, Canada, and Mexico.True

          

  354. pollutionA general rise in the level of prices (EI)

          

  355. A syndicate is a long-term, permanent association of individuals or firms.
    a. True
    b. False
    a. True

          

  356. Trade associations often do provide ethical guidelines for their members.1. Listen and learn
    2. Identify the ethical issues.
    3. Create and analyze options
    4. Identify the best option from your point of view.
    5. Explain your decision and resolve any differences that arise.

          

  357. syndicateissued by the exporter's bank, ordering the importer's bank to pay for the merchandise, thus guaranteeing payment once accepted by the importer's bank

          

  358. The only current example of a command economy is capitalismFalse

          

  359. Sandra, a purchasing agent for Friday Farms, has just secured a new vendor for tractors, plows, and harrows. The new vendor offers Sandra some small, extra pieces of equipment—rakes, shovels, and hand trowels—knowing that the hand tools are always useful as well. The new vendor also is anxious to secure future bids. Sandra needs a few hand tools for her own garden and decides that doing business with this new vendor is in everyone's best interest. From an ethical standpoint, Sandra needs to be very aware ofTrue

          

  360. The _____________ investigates illegal trade practicesFederal Trade Commission

          

  361. Explain the economic basis for international business.International business encompasses all business activities that involve exchanges across national boundaries. International trade is based on specialization, whereby each country produces the goods and services that it can produce more efficiently than any other goods and services. A nation is said to have a comparative advantage relative to these goods. International trade develops when each nation trades its surplus products for those in short supply.

    A nation's balance of trade is the difference between the value of its exports and the value of its imports. Its balance of payments is the difference between the flow of money into and out of the nation. Generally, a negative balance of trade is considered unfavorable.

          

  362. The EPA is a federal agency charged with enforcing laws intended to protect the environmentGovernments, trade associations, and individual firms can establish guidelines for defining ethical behavior.
    1- Governments can pass stricter regulations.
    2- Trade associations provide ethical guidelines for their members.
    3-Companies provide codes of ethics—written guides to acceptable and ethical behavior as defined by an organization—and create an atmosphere in which ethical behavior is encouraged. 4-An ethical employee working in an unethical environment may resort to whistle-blowing to bring a questionable practice to light.

          

  363. 10 Aspects of Business that May Require Legal Help1. Choosing either the sole proprietorship, partnership, corporate or some special form of ownership.
    2. Constructing a partnership agreement.
    3. Incorporating a business
    4. Registering a corporation's stock
    5. Obtaining a trademark, patent, or copyright
    6. Filling for licenses or permits at the local, state, and federal levels.
    7. Purchasing an existing business or real estate
    8. Creating valid contracts
    9. Hiring employees and independent contractors
    10. Extending credit and collecting debts.

          

  364. Define business and identify potential risks and rewards....

          

  365. The Basis for International Business1. Economics
    2. Microeconomics
    3. Macroeconomics
    4. Economy

          

  366. partnershipa racial, religious, political, national, or other group regarded as different from the larger group of which it is a part and that is often singled out for unfavorable treatment

          

  367. A trading company provides a link between buyers from one country and sellers in another country.
    a. True
    b. False
    Customers eventually find put which firms act responsibly and which do not.

          

  368. Microeconomics is the study of the economy of an entire nation as well as the global economy...

          

  369. Sustainabilitya racial, religious, political, national, or other group regarded as different from the larger group of which it is a part and that is often singled out for unfavorable treatment

          

  370. DeflationThe separation of a manufacturing process into distinct tasks and the assignment of the different tasks to different individuals

          

  371. Oligopoly1. A market situation (or industry) in which there are few sellers (Ex. automobile manufacturers, car rental agencies, and farm implement industries)
    a) Sizable investments are required to enter into the market
    b). Each seller has considerable control over price
    c). The market actions of one seller can have a strong effect on competitors

          

  372. Which of the following federal laws was not passed between 1887 and 1914 as were the others?Fair Packaging and Labeling Act

          

  373. Market Economyan economic system in which businesses and individuals decide what to produce and buy, and the market determines quantities sold and prices

          

  374. At least one general partner must be responsible for the debts of the limited partnership.
    a. True
    b. False
    economic model of social responsibility.