The Firm & Its Environment

A smaller number of firms increase rivalry because fewer firms must compete for the same customers and resources.

• True

• False

Which of the following is an advantage of a sole proprietorship?

• Pride ownership

• Ease of starting a business

• Being your own boss

• All of the given options

A sole proprietorship is the simplest form of business organization.

• True

• False

Which of the following is not a commonly used term to describe an element of the business environment?

• Macro-environment

• Micro-environment

• Extrinsic environment

• Internal environment

Which of the following is an opportunity for an organization?

• Poor marketing skills

• Good distribution skills

• Limited management skills

• Rapid market growth

Which of the following is a threat for an organization?

• Economic downturn

• Out-of-date products / technology

• Higher costs

• Rapid market growth

With regard to a sole proprietorship, the owner of the business is the business; in other words, there is no separate legal entity.

• True

• False

Which of the following does not form part of a firm's macro-environment?

• political environment

• economic environment

• technological environment

• internal environment

Corporation pertains to the establishments, operations, and profits of large business which was handled by groups of people.

• True

• False

This is something that at some time in the future may destabilize and/or reduce the potential performance of the organization.

• Strength

• Opportunity

• Threat

• Weakness