DECA Practice Quiz

Which of the following types of business organizations reduces or limits the risk of its stockholders:

• Franchise

• Sole proprietorship

• Corporation

• Partnership

Answer explanation

Corporation. A corporation, which is owned by its stockholders, limits the losses or risks to the amount each individual owner has invested in the corporation. The other types of business organizations are not owned by stockholders. A partnership usually divides the risk among two or three partners. In a sole proprietorship, the owner generally assumes all of the risk. A franchise is a contractual agreement between a parent company and a franchisee to distribute goods and services.

A business that effectively coordinates channel management with marketing activities is more likely to provide

• good customer service.

• attractive product displays.

• free delivery.

• flexible credit terms.

Answer explanation

Good customer service. Channel management is one of the marketing functions that must work with the other marketing activities to get goods and services from producers to consumers. The goal of marketing is to satisfy consumer wants and needs while achieving company goals. Businesses cannot satisfy those needs and provide quality customer service unless all the marketing activities work together. For example, businesses are only able to serve customers when they have the advertised items on hand and at the right price. Not all businesses need or use product displays, provide free delivery, or offer flexible credit terms.

Which of the following would probably use a longer channel of distribution than the others:

• A bag of oranges

• A printing press

• An airplane

• A bottle of shampoo

Answer explanation

A bottle of shampoo. Shampoo is a low-cost, standard product that would probably use a longer channel of distribution than the other alternatives. A bag of oranges is perishable and needs to use short channels. A printing press is highly technical, requires installation, and is quite heavy; therefore, it would rely on short channels. An airplane is technical and quite heavy and would probably use a direct route from the producer to the industrial user.

Electronic billing, purchase-order verification, bar-code technology, and image processing are examples of

• functions of the finance department.

• horizontal channel integration.

• integrated data between channel members.

• vertical channel integration.

Answer explanation

Integrated data between channel members. The technology of electronic billing, purchase-order verification, bar coding, and image processing enable channel members to integrate data. Vertical and horizontal channel integration are methods of organizing distribution channels. The finance department may utilize the methods to share data, but the methods are not unique to that department.

When filing a tort against a business, the plaintiff must establish that the defendant

• violated the doctrine of sovereign immunity.

• damaged property intentionally.

• conspired with a competitor.

• breached the duty of care.

Answer explanation

Breached the duty of care. The duty of care is the basic principle that expects all individuals and businesses to exhibit socially responsible behavior by using caution to prevent harm and by watching out for one another. A tort is a private wrongdoing that potentially harms another person or entity. If a business or one of its employees breaches the duty of care, the business may be held liable for the tort. However, the plaintiff must have grounds or proof that establishes that the business or its employee (defendant) has committed a wrongful act, thereby breaching the duty of care. Intentional damage and conspiring with a competitor (collusion) are types of torts. The doctrine of sovereign immunity is the universally accepted principle that each nation has the right to manage its own government and develop its own laws.

A producer can minimize channel conflict among its distributors and retailers by

• selling its items directly to the end users.

• offering different products through each channel.

• establishing slotting fees for certain channels.

• requesting that the channel members carry only its brand.

Answer explanation

Offering different products through each channel. Channel conflict can occur when channel members are competing among themselves for customers. When each channel sells different products, they are not directly competing among themselves for business. For example, if a guitar manufacturer sells its line of guitars through authorized distributors and sells accessories for the guitars through online retailers, the channel members are not competing for the customers because they are selling different products. Bypassing channel members and selling directly to end users, establishing slotting fees, and requesting channel members to carry only its brand are actions that tend to create channel conflict rather than minimize it.

What is an advantage of verbal communication?

• You use passive listening skills to understand the message.

• Tone of voice can be used to express emotions and thoughts.

• It focuses attention on facial expressions rather than words to express enthusiasm.

• People must see you to understand the intent of your message.

Answer explanation

Tone of voice can be used to express emotions and thoughts. This means that people can show their interest and enthusiasm by what they say and by the way they say it. Although body language conveys intent, people can communicate how they feel through their choice of words. The words that people use often express their interest and enthusiasm. A key element of verbal communication is active listening.

When Amber walked by Ryan's desk, she noticed that Ryan was raking his left hand through his hair, that his face was red, and that he kept hitting the enter button on his keyboard with his right hand, while frowning at his computer screen. Based on his nonverbal cues, Amber would probably assume that Ryan was

• patient.

• frustrated.

• bored.

• enthusiastic.

Answer explanation

Frustrated. Nonverbal cues can tell others a lot about your emotions. In this situation, Ryan's nonverbal behavior indicated that he was frustrated because he couldn't get his computer to do what he wanted it to do. If Ryan was patient, he would not continuously hit his keyboard, turn red, or frown. If Ryan was bored, he would be inattentive about his situation or surroundings. He might even yawn or do something other than computer work for a while. Enthusiasm is associated with a positive attitude.

You're giving directions to a group of coworkers, and you want to be sure they do exactly what you say. You should

• raise your voice.

• give directions in the proper order.

• make the directions challenging.

• demonstrate the final steps of the directions.

Answer explanation

Give directions in the proper order. It's much easier for your listeners to follow along if you give directions in the order in which they should be completed. Raising your voice isn't necessary when giving directions; in fact, it may intimidate your listeners. Your directions should not be challenging, even if the task itself is challenging. If you choose to demonstrate how to complete the directions, you should show how to do each step, not just the final ones.

It is most appropriate for businesspeople to use complex, technical jargon when they are

• speaking with coworkers.

• greeting new customers.

• introducing a friend to a business associate.

• informally conversing with an acquaintance.

Answer explanation

Speaking with coworkers. Jargon is a specialized language known only to a certain group of people. Industries and companies often use jargon that is meaningful to their businesses and may not be easily understood by people outside their industries or companies. Coworkers are more likely to use jargon because they are familiar with the terms and their meanings or applications. New customers, friends, business associates, and acquaintances may not be familiar with a specific industry's jargon.