5.03, 5.04 and 5.05 POB Review

A small-business owner whose business is a sole proprietorship is planning to “go global.” What method for going global would be best to recommend to the small-business owner?

• Start by hiring an export management company.
• Start by building facilities in the countries of interest.
• Start by merging with a foreign business that can sell your products.
• Start by renting facilities in the countries of interest and hiring foreign employees.

Which is an example of an economic factor that affects the business environment?

• business cycle
• employee morale
• management style
• long-term goals

The two main divisions of the trade industry are:

• manufacturers and wholesalers.
• wholesalers and retailers.
• producers and retailers.
• wholesalers and producers.

A U.S. company would decide to offer its products in other countries as a reason to:

• subsidize developing countries.
• sell obsolete, outdated products.
• expand to new, untapped markets.
• provide jobs to people in other countries.

Which factor has aided the most in creating a global business environment?

• technology
• government
• cultural change
• exchange rate

Which is a factor that affects the business environment?

• industry competition
• staff organization
• information management
• conflict negotiation

Which situation would most likely indicate the need to adapt to changes in the business environment?

• The supply of materials used in manufacturing a product has decreased.
• The number of the business's competitors has decreased.
• The demand for the product is stable.
• The business has experienced little employee turnover during the past year.

The owner of a small company decides to stock a new product. Which business activity should the owner use to inform potential customers about the new product?

• finance
• marketing
• management
• production
  

One reason why many small businesses develop an organizational design that requires a board of directors is because a board usually:

• provides experience that increases the business's credibility.
• assumes all legal responsibility for the business's actions.
• helps with the day-to-day operations of the business.
• evaluates the performance of the business's employees.

A group of individuals wants to open a museum that will display items from early settlers of the area. The group will charge just enough admission to pay the expenses of operating the museum. Will the museum be a business?

• No, the museum will not be considered a business.
• No, the museum will be a charitable institution.
• Yes, the museum will be a not-for-profit business.
• Yes, the museum will be a for-profit business.