Financial Planning II 4.01

Every new business owner must pay attention to forces operating outside the company that affect its chances for success. These forces are referred to as:

• the external environment

• cultural intelligence

• demographics

• competition

Sara is looking for a roofing company that has performed well in her area. A consumer-action agency that she should contact is the:

• Better Business Bureau

• National Business Forum

• Federal Housing Finance Agency

• Environmental Protection Agency

Volcano Fire, an electronic cigarette company, spends a large part of its revenues contacting state and federal legislators, trying to influence industry laws and policies. This is known as:

• lobbying

• budgeting

• political scam

• self-promotion

Outside factors that affect a business, such as political representatives and social trends, are considered to be:

• cyclical

• dynamic

• invasive

• static

How does technology affect a business's customers?

• It makes them spend more money

• It influences what they want and need

• It emphasizes certain cultural differences

• It distracts them from making informed buying decisions

When an economy is struggling, consumers are less likely to make discretionary purchases. Which is an example of a discretionary item?

• food

• clothing

• vacation

• medical care

Which business environment provides the most options for consumers?

• monopoly

• common economy

• global competition

• international sanctions

Which is an example of an external factor that might affect the business environment?

• Staff members are reassigned duties

• The business develops a new product

• The government implements new regulations

• The business improves its information systems

Industry associations differ from regulatory agencies in that they:

• exist to make a profit

• lack government authority

• are formed only for social purposes

• have been created to protect consumers

Amie deals with people from many different countries, so she studies their customs and traditions to become sensitive to these differences. Amie is developing:

• social responsibility

• cultural intelligence

• demographics

• globalization