Midterm in ACC 543 (Managerial Accounting)

Question
	

1) An investment that costs $25,000 will produce annual cash flows of $5,000 for a period of 6 years. Further, the investment has an expected salvage value of $3,000. Given a desired rate of return of 12%, the investment will generate a (round your answer to the nearest whole dollar)
A. negative net present value of $2,923
B. positive net present value of $20,557
C. positive net present value of $1,520
D. negative net present value of $25,000

2) Mountain Brook Company is considering two investment opportunities whose cash flows are provided below:
Year Investment A Investment B
Year 0
($15,000)
($9,000)
Year 1
5,000
5,000
Year 2
5,000
4,000
Year 3
5,000
3,000
Year 4
4,000
1,000
The company's hurdle rate is 12%. What is the present value index of Investment A?
A. 1.00
B. 0.97
C. 1.12
D. 1.01
3) Britannia Company has two investment opportunities. A cash flow schedule for the investments is provided below:
Year Investment A Investment B
Year 0
($5,000)
($6,000)
Year 1
2,000
3,000
Year 2
2,000
2,000
Year 3
2,000
2,000
Year 4
2,000
1,000
Assuming capital rationing is used, which of the following techniques would be most appropriate for choosing between Investment A and Investment B?
A. Payback technique
B. Present value index
C. Net present value technique
D. None of these techniques apply
Which of the following statements concerning payback analysis is true?
A. The payback method ignores the time value of money concept.
B. The payback method and the unadjusted rate of return are different approaches that will consistently lead to the same conclusion.
C. All of these are true.
D. An investment with a longer payback is preferable to an investment with a shorter payback.
5) Select the incorrect statement concerning the internal rate of return (IRR) method of evaluating capital projects.
A. A project whose IRR is less than the cost of capital should be rejected.
B. The higher the IRR the better.
C. The internal rate of return is that rate that makes the present value of the initial outlay equal to zero.
D. If a project has a positive net present value then its IRR will exceed the hurdle rate.
6) The rate of return that equates the present value of cash inflows and outflows is the
A. internal rate of return.
B. minimum rate of return.
C. none of these.
D. desired rate of return

7) An investment that costs $5,000 will produce annual cash flows of $2,000 for a period of 4 years. Given a desired rate of return of 10%, the investment will generate a present value index of
A. 1.268.
B. 0.789.
C. 7.745.
D. 2.500.
8) An investment that cost $48,000 provided annual cash inflows of $9,000 per year for six years. The desired rate of return is 10%. The actual return from the investment was
A. equal to the desired rate of return.
B. less than the desired rate of return.
C. the answer cannot be determined from the information provided.
D. greater than the desired rate of return.

9) Which of the following is the approximate internal rate of return for an investment that costs $45,880 and provides a $4,000 annuity for 20 years?
A. 6%
B. 5%
C. 10%
D. 8%

10) Yoplait Company employs material handling employees who move materials between production divisions at a labor cost of $160,000 a year. It is estimated that these employees move 75,000 pounds of material per year. If 6,000 pounds are moved in March, how much of the material handling cost should be assigned to products made in March?
A. $12,800
B. $12,000
C. $75,000
D. $26,666

11) Perrot Company has three divisions. For Perrot, a cost should be considered a direct cost if
A. it can be allocated to a division using an volume-based cost driver.
B. it meets certain guidelines imposed by generally accepted accounting principles.
C. it is a fixed cost.
D. it can be traced to a division in a cost-effective manner.

12) Joint products A and B emerge from common processing that costs $80,000 and yields 5,000 units of Product A and 4,000 units of Product B. Product A can be sold for $100 per unit. Product B can be sold for $80 per unit. What amount of the joint costs will be assigned to Product A if joint costs are allocated on the basis of number of units produced?
A. $48,780
B. $35,556
C. $44,444
D. $31,220

13) When a particular job is completed in a job order cost system, the general journal entry would include a
A. debit to Finished Goods Inventory and a credit to the appropriate job order cost sheet.
B. debit to Work in Process Inventory and a credit to Finished Goods Inventory.
C. debit to Work in Process and a credit to Manufacturing Overhead.
D. debit to Finished Goods Inventory and a credit to Work in Process Inventory.
Moore Company uses process costing. The following information was available for October:
Units Costs
Work in process Oct. 1
100
$ 7,500
Work in process Oct. 30
200
(A)
Transferred in
1,000
$12,500
Ending inventory is 50% complete. Based on the information given, (A) above would be what amount?
A. $4,000
B. $2,000
C. $1,650
D. $1,500
15) The Ragan Corporation uses a process cost system. The company started March with 2,300 units in Work in Process–Dept. A. During the month 4,000 units were started. At the end of the month there were 3,200 units in ending Work in Process–Dept. A inventory that were 30% complete. The beginning work in process balance was $240,540 and total manufacturing cost for the period was $608,000. Based on this information, the amount of cost transferred from Work in Process–Dept. A to Work in Process–Dept. B was
A. $254,562.
B. $200,640.
C. $647,900.
D. $543,233.
16) Brumlow Company has a contribution margin ratio of 25%. The company is considering a proposal that will increase sales by $100,000. What increase in profit can be expected assuming total fixed costs increase by $20,000?
A. $20,000
B. $15,000
C. $25,000
D. $5,000
17) Select the incorrect break-even equation from the following:
A. Total contribution margin = total variable costs
B. Total revenue = total costs
C. Total fixed costs / contribution margin ratio
D. Total contribution margin = total fixed costs
18) A product has a contribution margin of $6 per unit and selling price of $20 per unit. Fixed costs are $18,000. Assuming new technology doubles the unit contribution margin but increases total fixed costs by $15,000, what is the breakeven point in units?
A. 2,750 units
B. 5,500 units
C. 4,000 units
D. 1,250 units
19) Which of the following items is not needed to prepare an inventory purchases budget for a merchandising business?
A. Units in beginning inventory
B. Desired units in ending inventory
C. Expected unit selling price
D. Expected unit sales
20) Which of the following budgets or schedules uses data contained in the selling and administrative expense budget?
A. Cash receipts schedule
B. Sales budget
C. Inventory purchases budget
D. Cash payments schedule

21) Select the incorrect statement about the master budget.
A. The master budget usually includes operating budgets, capital budgets and pro forma financial statements.
B. Preparing the master budget begins with the sales forecast.
C. The budgeting process usually begins with preparing the operating budgets.
D. The master budget is a group of detailed budgets and schedules representing the company's operating and financial plans for the past accounting period.

22) Huntsville Company reported a $4,000 unfavorable direct labor price variance and a $1,500 favorable direct labor usage variance. Select the incorrect statement from the following.
A. It took the employees less time to produce the outputs than expected.
B. It is possible that the supervisor attempted to use more highly skilled (and paid) employees than allowed for by the direct labor standards.
C. The total direct labor variance is $2,500 unfavorable.
D. The standard direct labor rate must have exceeded the actual direct labor rate.

23) When would a variance be labeled as favorable?
A. When standard costs are less than actual costs
B. When actual costs are less than standard costs
C. When expected sales are greater than actual sales
D. When standard costs are equal to actual costs

24) Gonzalez Company makes a product that is expected to use 1.2 pounds of material per unit of product. The material has a standard cost of $2 per pound. Gonzalez actually used 1.25 pounds of material per unit of product made in January. The actual cost of material was $1.95 per pound. Based on this information alone, the condition of the variances for the January production would be
A. unfavorable for price and favorable for usage.
B. favorable for price and favorable for usage.
C. favorable for price and unfavorable for usage.
D. unfavorable for price and unfavorable for usage.
25) You are considering an investment in Delta Airlines stock and wish to assess the firm's ability to generate earnings. All of the following ratios can be used to assess profitability except:
A. Asset turnover
B. Average days to collect receivables
C. Return on investment
D. Net margin
26) You are considering an investment in Coca Cola Company stock and wish to assess the firm's long-term debt-paying ability and its use of debt financing. All of the following ratios can be used to assess solvency expect:

A. Net margin
B. Debt to assets ratio
C. Debt to equity ratio
D. Number of times interest is earned
27) You are considering an investment in IBM Company stock and wish to assess the firm's short-term debt-paying ability. All of the following ratios are used to assess liquidity except:
A. Inventory turnover
B. Debt to equity ratio
C. Quick ratio
D. Accounts receivable turnover
28) Sometimes employees will deliberately overstate the amount of materials and/or labor that should be required to complete a job. The difference between inflated and realistic standards is known as
A. budget slack.
B. cooking the books.
C. lowballing.
D. making the numbers.
29) In monitoring process quality we might use which of the following statistics?
A. Percentage deviation from tolerance centers
B. Logarithmic control intervals
C. “k” values for the sample mean
D. Difference between the highest and lowest value in a sample
E. Absolute values
30) Which manager is usually held responsible for materials usage variances?
A. purchasing agent
B. marketing manager
C. plant manager
D. production supervisor
	

Environment Essay Paper

Question
	
Environmental

Project
3
 

 Project
format: Each page must be typed in 12-point Times New Roman or similar
typeface, 1” margins on all sides, double-spaced. Please remember to correct
misspellings and grammatical errors. On the first page, in the upper right hand
corner, place your name, class title (TECH 454 - Environmental Engineering),
and the date. Also on the first page, below the name block, place the title:
“Project 3”.

 Write
your answers to the following questions in Short Essay Format. Be
sure to be descriptive in your answers. Include reasons and facts as required
to support your answers. Cite examples.

 Number
your answers for each question.

 Visit
a local hardware or large retail store and identify a variety of products that
incorporate a rechargeable battery as part of the
design. Give examples and describe for each part:

In
a large retail store a variety of products are found that incorporate a rechargeable battery
as part of the design. The examples of these products are given under the
heading of their respective rechargeable battery as follows.

One
product that was designed for easy removal and replacement of
the battery. Describe how the battery removal works.

A
Product with easy removal and replacement of the battery

One
product that has good labeling to inform the consumer about
the proper disposal of the battery. (Think easy to see/read.)

Product’s
labeling about the proper battery disposal

Describe
one product that you could suggest physical modifications to
its design to make it easier to access and replace the batteries. (Putting a
label on the product does not count as a physical
modification.)

Use
the Internet or library to help find information on wind power. What are the
current barriers to the building of more wind farms? How much progress has been
made in improving the efficiency and reducing the cost of this technology? 

Due
Date: 11/11/2013
	

uop MGT/426 week 1 assignment

Question
	



 

 

 

UOP

Week
 One: Defining Change
 

 

 

 

 
 

 
Details
 
 

 
Due
 
 

 
Points
 

 

 

 
Objectives
 
 

 
1.1
 Explain change and cycle of change. 
 
1.2
 Compare and contrast continuous and discontinuous change. 
 
1.3
 Explain the two types of change agents. 
 
1.4
 Explain the various roles of managers and individuals in the change
 process. 
 
1.5
 Define the learning organization.
 
 

 
9/12/2013
 
6:00pm
 
 

 

 

 

 

 
Reading
 
 

 
ReadCh. 1-4 of Managing
 Organizational Change.
 
Readthis week’s Electronic Reserve
 Readings.
 
 

 
9/12/2013
 
6:00pm
 
 

 

 

 

 

 
Participation
 
 

 
Participate in class discussion.
 
 

 
9/12/2013
 
10:00pm
 
 

 
4
 

 

 

 
Individual 
 
My
 5-Year Projection
 
 

 
Individual Assignment:Article Review
 

 
·
 Use the course’s Electronic Reserve
 Readings (ERR), the Internet, or other resources, to find an article that
 defines the learning organization. 
 
·
 Prepare a 700-1,050-word
 Article Review that includes the following:
 

 
o
 Summarize the article.
 
o
 Summarize the author’s
 conclusion and/or recommendation.
 
o
 Summarize your conclusion
 and/or recommendation.
 
o
 Summarize how the concept in
 the article applies to your organization.
 

 
·
 Format your paper consistent with APA
 guidelines.
 

 
 

 
9/14/2013
 
6:00am
 
 

 
3
 

	

IT Strategic Planning of Xerox Compny Paper

Question
	
Required Assignment 2—IT Strategic Planning
Using a company of your choice, determine the strategic business goals. Develop an IT strategy that aligns with the business goals. You can use the balanced scorecard approach or you can develop your own method for defining and aligning the IT strategy to the business strategy. You will need to cite at least two credible sources that will provide justification for your strategy or approach.
Finding a company: If you are employed, it is best for you to use your current place of employment so you can practically apply the concepts in this assignment. Alternatively, you can use a nonprofit organization or any other organization you may have ties or access to.
Your IT strategy should include:
Business Goals and Objectives
List at least two or three specific business goals for the next year or two with an explanation of the business’ rationale for the goal.
List an objective for each business goal to explain what the company needs to do to achieve the goal.
IT Strategies aligned with business goals and objectives
List one or two IT strategies for each business goal
These should be recommended strategies that would enable the business goals and objectives to be achieved.
If your company already has IT strategies, you may provide an analysis and justification or new recommendation for each of the strategies
Organizational Structure
Describe the structure of the organization including:
Organizational design
Organizational culture
Leadership factors (the types of leadership displayed within the company)
Business processes
Physical layout (i.e., how many offices, virtual offices, international locations)
IT Infrastructure
Describe the current IT infrastructure including:
Hardware
Software
Network
IT resources
This should be a high-level overview
IT Challenges
Describe internal and external challenges IT faces in meeting the business needs
Include social and/or ethical considerations
Risks
Describe risks IT might face when implementing change
As you develop your strategy, you may want to consider the following:
An effective IT strategy will enable the business operations, helping business leaders achieve business goals more efficiently and effectively.
Focus on top priorities. Take the time to understand organizational issues, how they are related, and how they affect performance. Determine what will happen if nothing changes and where IT can have the greatest, positive impact.
Identify how IT supports business processes. The business is relying on their capabilities to achieve the business goals. The IT strategy should include a plan for supporting those business capabilities, creating efficiencies, and competitive advantage for the business.
Define IT priorities and governance of IT. Without priorities and a process for IT governance in place, progress will be slow. An agreed upon plan for governing IT will enable the decision process.
Understand the challenges. Improving processes and increasing efficiencies through IT implementation also require behavioral and sometimes organizational change. With these changes come inherent challenges. Understanding and planning for those challenges will increase the chance of success in meeting the business goals.
Write an 8–12-page paper in Word format. Apply APA standards for citation of sources. Use the following file naming convention: LastnameFirstInitial_M5_A2.doc.

	

Tony and Suzie graduate from college in May 2012 and begin developing

Question
	Additional Perspectives 2-1
[The following information applies to the questions displayed below.]

Tony and Suzie graduate from college in May 2012 and begin developing their new business. They begin by offering clinics for basic outdoor activities such as mountain biking or kayaking. Upon developing a customer base, they’ll hold their first adventure races. These races will involve four-person teams that race from one checkpoint to the next using a combination of kayaking, mountain biking, orienteering, and trail running. In the long run, they plan to sell outdoor gear and develop a ropes course for outdoor enthusiasts.

On July 1, 2012, Tony and Suzie organize their new company as a corporation, Great Adventures Inc. The articles of incorporation state that the corporation will sell 30,000 shares of common stock for $1 each. Each share of stock represents a unit of ownership. Tony and Suzie will act as co-presidents of the company. The following business activities occur during July.

Jul. 1
Suzie purchases $15,000 of Great Adventures' common stock using cash she saved during college.
Jul. 1
Tony purchases $15,000 of Great Adventures' common stock by borrowing from a local bank using his personal vehicle as collateral.
Jul. 1
Suzie purchases a one-year insurance policy for $4,800 ($400 per month) to cover injuries to participants during outdoor clinics.
Jul. 2
The company pays legal fees of $1,300 associated with incorporation.
Jul. 4 ]
Suzie purchases office supplies of $1,800 on account.
Jul. 7
Suzie pays advertising of $380 to a local newspaper for an upcoming mountain biking clinic to be held on July 15. Attendees will be charged $50 the day of the clinic.
Jul. 8
Tony purchases 10 mountain bikes, paying $11,700 cash.
Jul. 15
On the day of the clinic, Great Adventures receives cash of $4,000 from 80 bikers. Tony conducts the mountain biking clinic.
Jul. 22
Because of the success of the first mountain biking clinic, Tony holds another mountain biking clinic and the company receives $4,300.
Jul. 24
Suzie pays advertising of $890 to a local radio station for a kayaking clinic to be held on August 10. Attendees can pay $110 in advance or $160 on the day of the clinic.
Jul. 30
Great Adventures receives cash of $5,500 in advance from 50 kayakers for the upcoming kayak clinic.


Required:
Record each transaction in July.
	

ABC Co for 2012:

Question
	1.

The following applies to the ABC Co for 2012:
Transactions in Common Shares
1/1/12, Beginning Outstanding Shares
4/1/12, Stock buyback
6/1/12, Stock Split 2-for-1
10/1/12, Issuance of Additional Shares

Change

Shares
Outstanding

(90,000)
4,910,000
200,000

5,000,000
4,910,000
9,820,000
10,020,000

Outstanding Stock Options (Granted in 2010)
Options for 90,000 shares exercisable at the option price of $35 per share. Average 2012
market price was $50 per share. (Market price and option price already adjusted for stock
split).
Convertible Bonds (Issued December 1, 2012)
$10 million of 3% bonds convertible to shares of common stock. Each $1,000 bond
converts to 80 shares of common.
Net income in 2012 was $2,200,000. ABC’s tax rate is 40%
A) Compute the basic earnings per share for 2012.
B) Compute the diluted earnings per share for 2012.
2.

On September 1, 2012, The XYZ Co. issues $5,000,000 of bonds having a coupon rate of
8%. To help the sale, detachable stock warrants are issued at the rate of five warrants for
each $1,000 bond sold. The fair market value of the warrants is $5 each. The bonds with
the warrants sold at 104 plus accrued interest. Interest is payable on November 1st and
May 1st. (Assume a 360 day year, i.e., 30-day months.)
Prepare the 9/1/12 entry for this transaction.	

ECO – Chapter 4 – Elasticity

Question
	Chapter 4 - Elasticity - Sample Questions
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
1) The slope of a demand curve depends on
A) the units used to measure quantity but not the units used to measure price.
B) the units used to measure price and the units used to measure quantity.
C) the units used to measure price but not the units used to measure quantity.
D) neither the units used to measure price nor the units used to measure quantity.
1)
2) The price elasticity of demand depends on
A) the units used to measure price but not the units used to measure quantity.
B) the units used to measure price and the units used to measure quantity.
C) the units used to measure quantity but not the units used to measure price.
D) neither the units used to measure price nor the units used to measure quantity.
2)
3) The price elasticity of demand measures
A) the slope of a budget curve.
B) how often the price of a good changes.
C) the responsiveness of the quantity demanded to changes in price.
D) how sensitive the quantity demanded is to changes in demand.
3)
4) When the quantity of coal supplied is measured in kilograms instead of pounds, the demand for
coal becomes
A) more elastic. B) neither more nor less elastic.
C) less elastic. D) undefined.
4)
5) The price elasticity of demand equals
A) the percentage change in the quantity demanded divided by the percentage change in the
price.
B) the change in the quantity demanded divided by the change in price.
C) the percentage change in the price divided by the percentage change in the quantity
demanded.
D) the change in the price divided by the change in quantity demanded.
5)
6) If a rightward shift of the supply curve leads to a 6 percent decrease in the price and a 5 percent
increase in the quantity demanded, the price elasticity of demand is
A) 0.83. B) 0.30. C) 0.60. D) 1.20.
6)
7) A 10 percent increase in the quantity of spinach demanded results from a 20 percent decline in its
price. The price elasticity of demand for spinach is
A) 0.5. B) 20.0. C) 2.0. D) 10.0.
7)
8) A 20 percent increase in the quantity of pizza demanded results from a 10 percent decline in its
price. The price elasticity of demand for pizza is
A) 2.0. B) 10.0. C) 0.5. D) 20.0.
8)
1
9) Suppose a rise in the price of peaches from $5.50 to $6.50 per bushel decreases the quantity
demanded from 12,500 to 11,500 bushels. The price elasticity of demand is
A) 0.5. B) 1000.0. C) 2.0. D) 1.0.
9)
10) A fall in the price of lemons from $10.50 to $9.50 per bushel increases the quantity demanded from
19,200 to 20,800 bushels. The price elasticity of demand is
A) 1.25. B) 1.20. C) 8.00. D) 0.80.
10)
11) A fall in the price of cabbage from $10.50 to $9.50 per bushel increases the quantity demanded from
18,800 to 21,200 bushels. The price elasticity of demand is
A) 1.20. B) 0.80. C) 8.00. D) 1.25.
11)
12) Suppose that the quantity of root beer demanded declines from 103,000 gallons per week to 97,000
gallons per week as a consequence of a 10 percent increase in the price of root beer. The price
elasticity of demand is
A) 1.66. B) 6.00. C) 0.60. D) 1.40.
12)
13) The price elasticity of demand is 5.0 if a 10 percent increase in the price results in a ________
decrease in the quantity demanded.
A) 10 percent B) 50 percent C) 2 percent D) 5 percent
13)
14) A shift of the supply curve of oil raises the price of oil from $9.50 a barrel to $10.50 a barrel and
reduces the quantity demanded from 41 million to 39 million barrels a day. The price elasticity of
demand for oil is
A) 2 million barrels a day per dollar. B) 0.5.
C) $1 per 2 million barrels a day. D) 2.0.
14)
Price
(dollars per bushel)
Quantity demanded
(bushels)
8 2,000
7 4,000
6 6,000
5 8,000
4 10,000
3 12,000
15) The table above gives the demand schedule for snow peas. The price elasticity of demand between
$6.00 and $7.00 per bushel is
A) 1.0. B) 5.0. C) 2.0. D) 2.6.
15)
16) The table above gives the demand schedule for snow peas. If the price of snow peas falls from
$4.00 to $3.00 a bushel, total revenue will
A) increase because demand is elastic in this range.
B) increase because demand is inelastic in this range.
C) decrease because demand is inelastic in this range.
D) decrease because demand is elastic in this range.
16)
2
17) The table above gives the demand schedule for snow peas. The demand curve for snow peas is a
straight line and so the elasticity of demand is
A) lower at higher prices. B) higher at higher prices.
C) 1 at all prices. D) the same at all prices but not 1.
17)
Price
(dollars per bushel)
Quantity demanded
(bushels)
A 10 0
B 8 4
C 6 8
D 4 12
E 2 16
18) The table above gives the demand schedule for peas. As you move from point A to point B, the
price elasticity of demand equals
A) 0.50. B) 0.11. C) 9.09. D) 0.22.
18)
19) The table above gives the demand schedule for peas. As you move from point C to point D, the
price elasticity of demand is
A) 3.00. B) elastic. C) 0.75. D) unit elastic.
19)
20) The table above gives the demand schedule for peas. Which of the following statements correctly
describes the price elasticity of demand?
A) The price elasticity of demand is larger at point A than at point B.
B) The price elasticity of demand is constant because the slope is constant.
C) The price elasticity of demand increases moving from point A to point B to point C to point D
to point E.
D) The price elasticity of demand is larger at point D than at point A.
20)
21) If demand is price elastic,
A) a 1 percent decrease in the price leads to an increase in the quantity demanded that exceeds 1
percent.
B) a 1 percent increase in the price leads to an increase in the quantity demanded that exceeds 1
percent.
C) the price is very sensitive to any shift of the supply curve.
D) a 1 percent decrease in the price leads to a decrease in the quantity demanded that is less than
1 percent.
21)
22) The price elasticity of demand can range between
A) negative one and one. B) zero and infinity.
C) zero and one. D) negative infinity and infinity.
22)
23) Demand is perfectly inelastic when
A) the good in question has perfect substitutes.
B) shifts in the supply curve results in no change in price.
C) shifts of the supply curve results in no change in quantity demanded.
D) shifts of the supply curve results in no change in the total revenue from sales.
23)
3
24) If the price elasticity is between 0 and 1, demand is
A) inelastic. B) elastic. C) perfectly elastic. D) unit elastic.
24)
25) Demand is inelastic if
A) a large change in quantity demanded results in a small change in price.
B) the price elasticity of demand is greater than 1.
C) the quantity demanded is very responsive to changes in price.
D) the price elasticity of demand is less than 1.
25)
26) A good with a vertical demand curve has a demand with
A) infinite elasticity. B) unit elasticity.
C) zero elasticity. D) varying elasticity.
26)
27) The demand curve in the figure above illustrates the demand for a product with
A) unit price elasticity of demand at all prices.
B) a price elasticity of demand that is different at all prices.
C) infinite price elasticity of demand.
D) zero price elasticity of demand at all prices.
27)
28) When the price elasticity of demand for a good equals
A) 0, the demand curve is horizontal. B) 1, the demand curve is vertical.
C) 1, the demand curve is horizontal. D) 0, the demand curve is vertical.
28)
29) A straight-line demand curve along which the price elasticity of demand equals 0 is one that
A) forms a 45 degree angle with the vertical axis.
B) is horizontal.
C) is vertical.
D) forms a 60 degree angle with the horizontal axis.
29
)
4
30) The demand for movies is unit elastic if
A) any increase in the price leads to a 1 percent decrease in the quantity demanded.
B) a 5 percent decrease in the price leads to an infinite increase in the quantity demanded.
C) a 5 percent increase in the price leads to a 5 percent decrease in the quantity demanded.
D) a 5 percent increase in the price leads to a 5 percent increase in total revenue.
30)
31) Unit elastic demand
A) means that the ratio of a change in the quantity demanded to a change in the price equals 1.
B) will be vertical.
C) means that the ratio of a percentage change in the quantity demanded to a percentage change
in the price equals 1.
D) will be horizontal.
31)
32) A good with a horizontal demand curve has a demand
A) with an income elasticity of demand of 0.
B) with a price elasticity of demand of infinity.
C) for which there are no substitute.
D) with a price elasticity of demand of 0.
32)
33) The demand curve in the figure above illustrates a product whose demand has a price elasticity of
demand equal to
A) infinity. B) zero at all prices.
C) a different amount at different prices. D) one at all prices.
33)
5
34) The demand curve in the figure above illustrates the demand for a product with
A) zero price elasticity of demand at all prices.
B) a price elasticity of demand that is different at all prices.
C) unit price elasticity of demand at all prices.
D) infinite price elasticity of demand.
34)
35) On a linear demand curve that intersects both axes,
A) the elasticity decreases as the price falls and quantity increases.
B) the elasticity is less than 1.00 at all prices.
C) the elasticity equals 1.00 at all prices.
D) the elasticity exceeds 1.00 at all prices.
35)
36) On a straight-line downward-sloping demand curve, the maximum elasticity of demand occurs
A) where it intersects the supply curve. B) at its vertical intercept.
C) at its horizontal intercept. D) at its midpoint.
36)
37) A straight-line demand curve with negative slope intersects the horizontal axis at 100 tons per
week. At the midpoint on the demand curve (corresponding to 50 tons per week) the price
elasticity of demand is
A) greater than 1.0. B) 0.5. C) 1.0. D) 0.
37)
6
38) The figure above illustrates a linear demand curve. By comparing the price elasticity in the $2 to $4
price range with the elasticity in the $8 to $10 range, you can conclude that the elasticity is
A) the same in both price ranges.
B) greater in the $8 to $10 range when the price rises but greater in the $2 to $4 range when the
price falls.
C) greater in the $8 to $10 range.
D) greater in the $2 to $4 range.
38)
39) The figure above illustrates a linear demand curve. If the price falls from $8 to $6,
A) the quantity demanded will increase by less than 20 percent.
B) total revenue will remain unchanged.
C) total revenue will increase.
D) total revenue will decrease.
39)
40) The figure above illustrates a linear demand curve. In the range from $8 to $6,
A) the demand is unit elastic.
B) the demand is price inelastic.
C) the demand is price elastic.
D) more information is needed to determine if the demand is price elastic, unit elastic, or
inelastic.
40)
41) The figure above illustrates a linear demand curve. If the price falls from $6 to $4,
A) total revenue will decrease.
B) total revenue will increase.
C) quantity demanded will increase by more than 100 percent.
D) total revenue will remain unchanged.
41)
7
42) The figure above illustrates a linear demand curve. In the price range from $8 to $6, demand is
________ and in the price range $4 to $2, demand is ________.
A) elastic; inelastic B) inelastic; inelastic
C) elastic; elastic D) inelastic; elastic
42)
43) The figure above illustrates a linear demand curve. If the price rises from $6 to $8 demand is
________ and if the price falls from $8 to $6 demand is ________.
A) inelastic; inelastic B) elastic; inelastic
C) elastic; elastic D) inelastic; elastic
43)
44) The demand curve in the figure above illustrates the demand for a product with
A) zero price elasticity of demand at all prices.
B) a price elasticity of demand that is different at all prices.
C) unit price elasticity of demand at all prices.
D) infinite price elasticity of demand.
44)
45) A straight-line demand curve with negative slope intersects the horizontal axis at 200 tons per
week. The point on the demand curve at which the price elasticity of demand is 1 corresponds to a
quantity demanded
A) that would be negative if a negative quantity demanded were possible.
B) of 100 tons.
C) of 0 tons.
D) of 200 tons.
45)
8
46) Demand is inelastic if
A) a leftward shift of the supply curve raises the total revenue.
B) the good in question has close substitutes.
C) the smaller angle between the vertical axis and the demand curve is less than 45 degrees.
D) large shifts of the supply curve lead to only small changes in price.
46)
47) Demand is unit elastic when
A) a shift of the supply curve leads to no change in price.
B) the slope of the demand curve is -1.
C) a change in the price of the product leads to no change in the total revenue.
D) a shift of the supply curve leads to an equal shift of the demand curve.
47)
48) Producers' total revenue will decrease if
A) the price rises and demand is inelastic.
B) income increases and the good is a normal good.
C) the price rises and demand is elastic.
D) income falls and the good is an inferior good.
48)
49) Producers' total revenue will increase if
A) income falls and the good is a normal good.
B) the price rises and demand is inelastic.
C) the price rises and demand is elastic.
D) income increases and the good is an inferior good.
49)
50) If the demand for a good is unit elastic,
A) a 5 percent increase in price results in a 5 percent increase in total revenue.
B) the demand curve is a straight line with slope of -1.
C) a 5 percent increase in price results in a 5 percent decrease in total revenue.
D) a 5 percent increase in price does not change total revenue.
50)
51) A shift of the supply curve of oil raises the price from $10 a barrel to $30 a barrel and reduces the
quantity demanded from 40 million to 23 million barrels a day. You can conclude that the
A) supply of oil is elastic. B) supply of oil is inelastic.
C) demand for oil is inelastic. D) demand for oil is elastic.
51)
52) A shift of the supply curve of oil raises the price from $10 a barrel to $15 a barrel and reduces the
quantity demanded from 40 million to 15 million barrels a day. You can conclude that the
A) demand for oil is elastic. B) supply of oil is elastic.
C) supply of oil is inelastic. D) demand for oil is inelastic.
52)
53) A leftward shift of the supply curve of cookies raises the price of a cookie from 10 cents to 20 cents
and decreases the quantity demanded from 700,000 to 500,000. You can conclude that
A) the supply of cookies is elastic. B) the supply of cookies is inelastic.
C) the demand for cookies is elastic. D) the demand for cookies is inelastic.
53)
9
54) The demand for a good is elastic if
A) a decrease in its price results in a decrease in total revenue.
B) the good is a necessity.
C) an increase in its price results in an increase in total revenue.
D) an increase in its price results in a decrease in total revenue.
54)
55) If a price decrease results in your expenditure on a good decreasing, your demand must be
A) unit. B) inelastic. C) linear. D) elastic.
55)
56) An increase in subway fares in New York City will boost your expenditures on subway rides if
A) the supply of subway rides is elastic. B) the supply of subway rides is inelastic.
C) your demand for subway rides is inelastic. D) your demand for subway rides is elastic.
56)
57) The more substitutes ava
ilable for a product,
A) the larger is its income elasticity of demand.
B) the smaller is its income elasticity of demand.
C) the smaller is its price elasticity of demand.
D) the larger is its the price elasticity of demand.
57)
58) Of the following, demand is likely to be the least elastic for
A) Toyota automobiles. B) compact disc players.
C) Ford automobiles. D) toothpicks.
58)
59) Of the following, demand is likely to be the least elastic for
A) pink grapefruit. B) iceberg lettuce.
C) insulin for diabetics. D) diamonds.
59)
60) The demand for food is most elastic in countries
A) with low income levels. B) that are highly urbanized.
C) with intermediate income levels. D) with high income levels.
60)
61) The demand for Honda Accords is
A) probably inelastic and less elastic than the demand for automobiles.
B) probably elastic but less elastic than the demand for automobiles.
C) probably elastic and more elastic than the demand for automobiles.
D) probably inelastic but more elastic than the demand for automobiles.
61)
62) The route from Dallas to Mexico City is served by more than one airline. The demand for tickets
from American Airlines for that route is probably
A) elastic and more elastic than the demand for all tickets for that route.
B) inelastic and less elastic than the demand for all tickets for that route.
C) elastic but less elastic than the demand for all tickets for that route.
D) inelastic but more elastic than the demand for all tickets for that route.
62)
10
63) The elasticity of demand for Gateway computers is probably
A) elastic and smaller than the elasticity of demand for computers overall.
B) inelastic and smaller than the elasticity of demand for computers overall.
C) inelastic but larger than the elasticity of demand for computers overall.
D) elastic and larger than the elasticity of demand for computers overall.
63)
64) Aglets are the metal or plastic tips on shoelaces that make it easier to lace your shoes. The demand
for aglets is probably
A) perfectly elastic. B) inelastic.
C) elastic but not perfectly elastic. D) unit elastic.
64)
65) The cross elasticity of demand measures the responsiveness of the quantity demanded of a
particular good to changes in the prices of
A) its complements but not its substitutes.
B) its substitutes but not its complements.
C) its substitutes and its complements.
D) neither its substitutes nor its complements.
65)
66) If goods are complements, definitely their
A) income elasticities are negative. B) income elasticities are positive.
C) cross elasticities are positive. D) cross elasticities are negative.
66)
67) If a rise in the price of good 1 decreases the quantity of good 2 demanded,
A) the cross elasticity of demand is negative. B) good 1 is an inferior good.
C) good 2 is an inferior good. D) the cross elasticity of demand is positive.
67)
68) The cross elasticity of demand between apples and oranges is defined as
A) the price elasticity of demand for apples divided by the price elasticity of demand for oranges.
B) the change in the quantity of apples demanded divided by the change in the quantity of
oranges demanded.
C) the percentage change in the quantity of apples demanded divided by the percentage change
in the price of oranges.
D) the percentage change in the quantity of apples demanded divided by the percentage change
in the quantity of oranges demanded.
68)
69) If the cross elasticity of demand between goods A and B is positive,
A) the demands for A and B are both price elastic.
B) A and B are complements.
C) A and B are substitutes.
D) the demands for A and B are both price inelastic.
69)
11
70) If the cross elasticity of demand between goods A and B is negative,
A) the demands for A and B are both price elastic.
B) A and B are complements.
C) the demands for A and B are both price inelastic.
D) A and B are substitutes.
70)
71) The greater the substitutability between Northwest timber and Southeast timber, the ________ is
the cross elasticity of demand between timber from the two regions and the ________ is the
elasticity of demand for Northwest timber.
A) smaller; smaller B) larger; smaller C) smaller; larger D) larger; larger
71)
72) If goods A and B are complements,
A) the cross elasticity of demand between A and B is negative.
B) the cross elasticity of demand between A and B is positive.
C) their income elasticities of demand are both less than 1.
D) their income elasticities of demand are both greater than 1.
72)
73) If a rise in the price of good B increases the quantity demanded of good A,
A) B is a substitute for A, but A is a complement to B.
B) A is a substitute for B, but B is a complement to A.
C) A and B are complements.
D) A and B are substitutes.
73)
74) If a fall in the price of good A increases the quantity demanded of good B,
A) A and B are substitutes.
B) A and B are complements.
C) B is a substitute for A, but A is a complement to B.
D) A is a substitute for B, but B is a complement to A.
74)
75) The cross elasticity of demand between Coca-Cola and Pepsi-Cola is
A) positive, that is, Coke and Pepsi are complements.
B) negative, that is, Coke and Pepsi are complements.
C) positive, that is, Coke and Pepsi are substitutes.
D) negative, that is, Coke and Pepsi are substitutes.
75)
76) A rise in the price of good A will shift the
A) supply curve of good B rightward if the cross elasticity of demand between A and B is
positive.
B) demand curve for good B rightward if the cross elasticity of demand between A and B is
negative.
C) demand curve for good B rightward if the cross elasticity of demand between A and B is
positive.
D) supply curve of good B rightward if the cross elasticity of demand between A and B is
negative.
76)
12
77) The income elasticity of demand is the percentage change in
A) income divided by the percentage change in price.
B) the quantity demanded divided by the percentage change in income.
C) the price divided by the percentage change in income.
D) income divided by the percentage change in quantity demanded.
77)
78) Demand is income elastic if
A) an increase in income will not affect the quantity demanded.
B) a small percentage increase in income will result in a large percentage increase in quantity
demanded.
C) the good in question has close substitutes.
D) a large percentage increase in income will result in a small percentage increase in quantity
demanded.
78)
79) The income elasticity of demand is high for
A) shelter. B) luxuries. C) clothing. D) food.
79)
80) To say that turnips are inferior goods means that the income elasticity
A) is definitely greater than 1.
B) is negative.
C) is positive but could be greater than or less then (or equal to) 1.
D) is definitely between 0 and 1.
80)
81) An increase in Abigail's income decreases her demand for cassette tapes. For her, cassette tapes are
A) a complement to any good. B) a normal good.
C) an inferior good. D) a substitute good.
81)
82) Goods whose income elasticities are negative are called
A) superior goods. B) inferior goods. C) normal goods. D) complements.
82)
83) A 10 percent increase in income has caused a 5 percent decrease in the quantity demanded. The
income elasticity is
A) 0.5. B) -2.0. C) 2.0. D) -0.5.
83)
84) Deb's income has just risen from $950 per week to $1,050 per week. As a result, she decides to
increase the number of movies she attends each month by 5 percent. Her demand for movies is
A) income inelastic. B) income elastic.
C) represented by a vertical line. D) represented by a horizontal line.
84)
85) Fred's income has just risen from $940 per week to $1,060 per week. As a result, he decides to
purchase 9 percent more steak per week. The income elasticity of Fred's demand for steak
is
A) 0.75. B) 1.33. C) 0.90. D) 1.00.
85)
86) Joan's income has just risen from $940 per week to $1,060 per week. As a result, she decides to
purchase 12 percent more lettuce per week. The income elasticity of Joan's demand for lettuce is
A) 1.33. B) 0.90. C) 1.00. D) 0.75.
86)
13
87) A 10 percent increase in income causes the quantity of orange juice demanded to increase from
19,200 to 20,800 gallons. The income elasticity of demand for orange juice is
A) 0.8. B) 1.2. C) 1.0. D) 0.5.
87)
88) A 10 percent increase in income causes the quantity of apple juice demanded to increase from
18,800 to 21,200 gallons. The income elasticity of demand for apple juice is
A) 0.5. B) 1.0. C) 1.2. D) 0.8.
88)
89) The above figure shows a good
A) that is an inferior good over all income ranges.
B) whose income elasticity is greater than 0 but less than 1.
C) that is a normal good over some income ranges and an inferior good over other ranges.
D) whose income elasticity always exceeds 1.0.
89)
90) Of the following, which one is most likely to have a negative income elasticity of demand?
A) shoes B) tennis balls
C) inter-city bus travel D) frozen yogurt
90)
14
91) The above figure shows a good
A) whose income elasticity is greater than 0 but less than 1.
B) that is an inferior good over all income ranges.
C) whose income elasticity always exceeds 1.0.
D) that is a normal good over some income ranges and an inferior good over other ranges.
91)
92) The above figure shows a good
A) whose income elasticity always exceeds 1.0.
B) whose income elasticity is greater than 0 but less than 1.
C) that is an inferior good over all income ranges.
D) that is a normal good over some income ranges and an inferior good over other ranges.
92)
15
93) The increase in the demand for widgets, shown in the figure above, is caused by an increase in the
price of McBoover devices. Therefore,
A) widgets and McBoover devices are substitutes.
B) widgets and McBoover devices are complements.
C) McBoover devices are a normal good.
D) widgets are a normal good.
93)
94) The increase in the demand for widgets, shown in the figure above, is caused by a decrease in the
price of McBoover devices. Therefore,
A) widgets and McBoover devices are substitutes.
B) widgets are a normal good.
C) McBoover devices are a normal good.
D) widgets and McBoover devices are complements.
94)
95) The increase in the demand for widgets, shown in the figure above, is caused by an increase in the
price of McBoover devices from $9 to $11. Therefore, the cross-price elasticity for these two
products is
A) 0.5. B) -2.0. C) 2.0. D) -0.5.
95)
96) The increase in the demand for widgets, shown in the figure above, is caused by a decrease in the
price of McBoover devices from $11 to $9. Therefore, the cross-price elasticity for these two
products is
A) -2.0. B) 2.0. C) -0.5. D) 0.5.
96)
97) The increase in the demand for widgets, shown in the figure above, is caused by an increase in
average incomes. Therefore, widgets
A) are a normal good. B) are elastically demanded.
C) are an inferior good. D) are inelastically demanded.
97)
16
98) The increase in the demand for widgets, shown in the figure above, is caused by an increase in
average incomes from $28,500 per year to $31,500 per year. Therefore, the income elasticity of
demand for widgets is
A) 4. B) 3/4. C) 1/4. D) 4/3.
98)
99) As income rises, the share of income spent on food in the United States
A) rises. B) remains constant at 15 percent.
C) falls. D) remains constant at 33 percent.
99)
100) The elasticity of supply measures the responsiveness of
A) quantity supplied to changes in price. B) quantity demanded to changes in supply.
C) quantity supplied to changes in income. D) quantity supplied to changes in demand.
100)
101) The elasticity of supply measures the sensitivity of
A) supply to changes in costs. B) quantity supplied to a change in price.
C) price to changes in supply. D) quantity supplied to quantity demanded.
101)
102) On most days the price of a rose is $1 and 80 roses are purchased. On Valentine's Day the demand
increases so that the price of a rose rises to $2 and 320 roses are purchased. Therefore, the price
elasticity of
A) demand for roses is about 1.8. B) supply of roses is about 1.8.
C) demand for roses is about 0.55. D) supply of roses is about 0.55.
102)
103) Supply is elastic if
A) a 1 percent change in price causes a larger percentage change in quantity supplied.
B) the good in question is a normal good.
C) the slope of the supply curve is positive.
D) a 1 percent change in price causes a smaller percentage change in quantity supplied.
103)
104) If a 1 percent decrease in the price of a pound of oranges results in a smaller percentage decrease in
the quantity supplied,
A) supply is inelastic. B) demand is inelastic.
C) demand is elastic. D) supply is elastic.
104)
105) If a 1 percent decrease in the price of a pound of squash results in a larger percentage decrease in
the quantity supplied,
A) demand is inelastic. B) demand is elastic.
C) supply is inelastic. D) supply is elastic.
105)
106) If at a given moment, no matter what the price, producers cannot change the quantity supplied, the
momentary supply
A) has infinite elasticity. B) has unit elasticity.
C) does not exist. D) has zero elasticity.
106)
17
107) If a rise in the price of oranges from $7 to $9 a bushel, caused by a shift of the demand curve,
increases the quantity of bushels supplied from 4,500 to 5,500 bushels, the
A) demand for oranges is elastic. B) supply of oranges is elastic.
C) demand for oranges is inelastic. D) supply of oranges is inelastic.
107)
108) If a shift in the demand curve that raises the price of oranges from $7 to $9 a bushel increases the
quantity of oranges supplied from 4,000 bushels to 6,000 bushels, the
A) supply of oranges is elastic. B) supply of oranges is inelastic.
C) demand for oranges is inelastic. D) demand for oranges is elastic.
108)
109) A rise in the price of cabbage from $14 to $18 per bushel, caused by a shift of the demand curve,
increases the quantity supplied from 4,000 to 6,000 bushels. The elasticity of supply is
A) 1.6. B) 1.0. C) 0.6. D) 0.8.
109)
110) If a 5 percent increase in the price results in a 9 percent increase in quantity supplied, the elasticity
of supply is
A) 0.30. B) 0.55. C) 1.80. D) 1.20.
110)
111) If a 5 percent increase in price results in a 3 percent increase in the quantity supplied, the elasticity
of supply is
A) 1.20. B) 0.60. C) 1.66. D) 0.30.
111)
112) A vertical supply curve indicates an elasticity of supply that equals
A) 0. B) infinity. C) 1. D) -1.
112)
113) A horizontal supply curve indicates an elasticity of supply that equals
A) 0. B) infinity. C) 1. D) -1.
113)
114) Suppose a 10 percent increase in the price of textbooks decreases the quantity demanded by 20
percent. The elasticity of demand for textbooks is
A) 0.2. B) 5.0. C) 10.0. D) 2.0.
114)
115) The quantity of new cars increases by 10 percent. If the price elasticity of demand for new cars is
1.25, the price of new cars will fall by
A) 8 percent. B) 10 percent. C) 2.5 percent. D) 12.5 percent.
115)
116) Suppose the price elasticity of demand for oil is 0.1. In order to lower the price of oil by 20 percent,
the quantity of oil supplied must be increased by
A) 20 percent. B) 2 percent. C) 0.2 percent. D) 200 percent.
116)
117) Moving up (to the left) along a linear demand curve, the price elasticity of demand
A) at first increases and then decreases. B) increases.
C) decreases. D) does not change.
117)
118) If the price elasticity of demand for a product equals 1, as its price rises the
A) total revenue increases. B) quantity demanded does not change.
C) total revenue
does not change. D) quantity demanded increases.
118)
18
119) A rise in the price of a product lowers the total revenue from the product if the
A) good is an inferior product. B) demand for the product is inelastic.
C) demand for the product is elastic. D) income elasticity of demand exceeds 1.
119)
120) If a 4 percent rise in the price of peanut butter lowers the total revenue received by the producers
of peanut butter by 4 percent, the demand for peanut butter
A) is inelastic. B) is elastic.
C) is unit elastic. D) has an elasticity of 2.0.
120)
121) A product is likely to have a price elasticity of demand that exceeds 1 when
A) its price falls.
B) it is a necessity.
C) it has close substitutes.
D) the percentage of income spent on it decreases.
121)
122) Which of the following is likely to have the smallest price elasticity of demand?
A) a new Ford automobile B) a new automobile
C) a new Ford Mustang D) an automobile
122)
123) A 10 percent decrease in the price of a Pepsi decreases the demand for a Coca-Cola by 50 percent.
The cross elasticity of demand between a Pepsi and Coca-Cola is
A) 5. B) 10. C) 0.20. D) 50.
123)
124) A fall in the price of X from $12 to $8 causes an increase in the quantity of Y demanded from 900 to
1,100 units. What is the cross elasticity of demand between X and Y?
A) 2 B) -0.5 C) -2 D) 0.5
124)
125) A fall in the price of X from $12 to $8 causes an increase in the quantity of Y demanded from 900 to
1,100 units. X and Y are
A) complements. B) normal goods. C) substitutes. D) inferior goods.
125)
126) A 10 percent decrease in income decreases the quantity demanded of compact discs by 3 percent.
The income elasticity of demand for compact discs is
A) 10.0. B) 3.3. C) -0.3. D) 0.3.
126)
19
127) In the figure above, when the price of a disk is $B, total revenue is shown in the graph by area
A) FCDE. B) ADE0. C) AGF0. D) BCF0.
127)
128) The above figure illustrates the demand curve for a good. The good has
A) many substitutes. B) no substitutes.
C) only one substitute. D) only a few substitutes.
128)
20
129) The elasticity of demand along the demand curve shown in the above figure is constant and equal
to 1. Thus,
A) area 0BCF equals area 0AGF. B) area 0BCF equals area 0ADE.
C) area 0BCF equals area FGDE. D) area ABCG equals area 0AGF.
129)
130) The above figure shows a linear (straight-line) demand curve. Start at point A and then moving to
point B and then point C, the price elasticity of demand
A) increases. B) increases and then decreases.
C) decreases and then increases. D) decreases.
	

general business data bank

Question
	
Multiple
Choice



101.
Your marketing communications
mix includes mail, telephone, fax, e-mail, or the Internet to communicate
directly with specific customers and prospects. Which of the eight major modes
of communication are you using? 

a. sales promotions 

b. advertising 

c. direct marketing 

d. personal selling 

e. events and experiences

102.
If a consumer has an equally
strong, favorable, and unique brand association of Subaru with the concepts
“outdoors,” “active,” and rugged” because of exposure to a TV ad that shows the
car driving over rugged terrain at different times of the year, the impact in
terms of Subaru’s brand equity should be ________. 

a.
identical 

b.
confusing 

c.
heightened 

d. long lasting

e. none of the above



103.
In the process of buying a new
car, a consumer might talk to others, research the car on the Internet, visit
showrooms, and buy magazines dedicated to the automobile industry. Where would
you start in developing your marketing communication planning? 

a. Appoint an ad agency.

b. Conduct an audit of all the potential
interactions the target market has with the brand.

c. Create message strategy.

d. Create the creative strategy.

e. None of the above







104.
Your
responsibility is to spend the company’s communications dollars efficiently. As
a result, you have collected the costs of the various forms of the
communications mix. Your decision on “where” to spend your company dollars will
be determined ________. 

a. according to its ability to build brand
equity and drive brand sales 

b. according to its ability to reach the most
consumers

c. according to its ability to return the
“most bang for the buck”

d. according to its ability to communicate the
“message” most creatively 

e. according to its ability to have the
highest return on investment 

 

105.
For
your target audience of new parents, communicating to them via newsletters,
parenting magazines, baby clubs, and through hospitals is an example of what
element of the macromodel of the communications process? 

a. Response 

b. Receiver 

c. Decoding 

d. Encoding

e. Media

 



106.
In developing effective
communications, the first step that you must take is to identify your target
audience. It is often useful to define target audience in terms of ________ and
loyalty. 

a. exposure 

b. image 

c. reach

d. usage

e. none of the above 



107.
Establishing
a product category, such as electric cars, as necessary to remove or satisfy a
perceived discrepancy between a current motivational state and a desired
emotional state is an example of a ________. 

a. category need

b. brand awareness

c. brand attitude

d. cognitive dissonance 

e. purchase intention 

 







108.
The
commercials for pain remedies that promise quick relief to your aches and pains
is an example of what type of creative strategy? 

a. Informational appeal

b. Transformational appeal

c. Collective appeal

d. Personal appeal

e. Differentiated appeal

 

109.
By
focusing on a non-product-related image, VW’s advertising to active, youthful
people with its “Drivers Wanted” campaign was an example of a ________.

a. informational appeal

b. collective appeal

c. transformational appeal

d. personal appeal

e. differentiated appeal



110.
Qualities
such as candor, humor, and naturalness make a source more _______, and
therefore more credible.

a. trustworthy

b. expert

c. knowledgeable

d. likable

e. interesting



111.
Which
of the following statements best describes findings by Osgood and Tannenbaum
related to congruity?

a. Attitude change will take place in the
direction of decreasing the amount of congruity between two evaluations.

b. Attitude change will take place in a way
that increases the amount of congruity between two evaluations.

c. Attitude change will take place moving away
from increasing the amount of congruity between two evaluations.

d. Attitude change will take place in a way
that increases the amount of incongruity between two evaluations.

e. None of the above.







112.
A
visit by a textbook publisher’s sales representative is an example of ________. 

a. advocate channels 

b. expert channels

c. social channels

d. interactive marketing 

e. e-marketing 

 

113.
When Chipotle entered the Manhattan market, it gave
burritos away to 6,000 people, anticipating that the event would create
sufficient buzz to get the store on its feet after opening. This is an example of ________ marketing.

a.
events and entertainment

b.
billboard

c.
word-of-mouth

d.
nonpersonal

e.
public relations

 



114.
The premise surrounding public
relations and publicity is that news stories and features about your company’s
product are more authentic and ________ to readers than advertisements. 

a. true 

b. influenced 

c. impartial 

d. effective 

e. credible 

 



115.
Communications-mix
allocations vary between consumer and business markets. Consumer marketers tend to spend
comparatively more on sales promotion and advertising; business marketers tend
to spend comparatively more on ________.

a. word-of-mouth marketing

b. personal selling

c. direct marketing

d. interactive marketing

e. events and experiences

 







116.
When a
communications director presents senior management with such things as press
clipping counts, the number of ads placed, media costs, and such, he is
supplying ________. 

a. feedback 

b. revenues

c. outcomes 

d. inputs

e. outputs and expenses 

 

 

117.
We find that 80% of the
consumers in the total market are aware of brand A, 60% have tried it, and only
20% who have tried it are satisfied.
This indicates that the communications program is effective in creating
awareness, but the product fails to meet consumer ________. 

a. effect on complementary products 

b. purchase intent 

c. awareness

d. interests

e. expectations 

 

118.
For a Citibank campaign to
market home equity loans, the bank used “mail plus coupon plus 800 number plus
outbound telemarketing plus print advertising.”
This kind of campaign is known as a ________.

a.
single-vehicle, single-stage
campaign

b.
single-vehicle, multiple-stage
campaign

c.
multiple-vehicle, single-stage
campaign

d.
multiple-vehicle,
multiple-stage campaign

e.
none of the above

 



119.
Dannon makes it a priority to
drive traffic to its Dannon Yogurt homepage so that the company can benefit
from the twin paybacks of (1) forging direct relationships with customers and
(2) building a database of its best customers.
This is an example of ________. 

a. personal selling 

b. integrated marketing communications

c. coordinating media

d. brand linkages

e. direct marketing 

 







120.
In assessing the collective
impact of an IMC program, the marketer’s overriding goal is to create the most
effective and efficient communications program possible. The criterion of ________ is the proportion
of the audience reached by each communication option employed, as well as how
much overlap exists among communication options.

a.
coverage

b.
contribution

c.
commonality

d.
complementarity

e.
versatility

 




	

BA3301 final exam

Question
	
Question 1
 
Many areas of law important to businesses are governed by the Uniform Commercial Code.
Answer
True
False
2 points 
Question 2
 
The town of Somerset passed a law forbidding parking on Main Street between the hours of 9:00 a.m. and 4:00 p.m. This is an example of an ordinance.
Answer
True
False
2 points 
Question 3
 
Tort law is a subset of private law that seeks to compensate the injured party for the loss caused by the actions of another.
Answer
True
False
2 points 
Question 4
 
The federal government and state governments have separate and distinct powers. This arrangement constitutes a(n)_______________separation of powers.
Answer

Vertical

Horizontal

Transitional

Equitable
2 points 
Question 5
 
Stare decisistranslates as
Answer

The thing is done that ought to be done.

Stand by the decision.

Stand and be recognized.

The decision of the sovereign
2 points 
Question 6
 
The jurist who presides over an equitable proceeding is called the
Answer

Grand master

Chancellor

Justice

Judgepro tempore
2 points 
Question 7
 
It is the function of the jury to decide the facts that are in dispute in a case.
Answer
True
False
2 points 
Question 8
 
To which of the following can the need to go to different courts for legal and equitable remedies be traced?
Answer

The early English court system

The Code of Napoleon

Article II of the Constitution

The Articles of Confederation
2 points 
Question 9
 
Only the United States Supreme Court can issue an interlocutory decree.
Answer
True
False
2 points 
Question 10
 
When the Supreme Court agrees to hear a case, it issues a writ of execution.
Answer
True
False
2 points 
Question 11
 
The written questions that parties to a suit send each other that are answered in writing under oath are interrogatories.
Answer
True
False
2 points 
Question 12
 
Peremptory challenges (or strikes) may not be based on race or gender.
Answer
True
False
2 points 
Question 13
 
A jury is selected through a process of asking potential jurors questions and eliminating unsuitable candidates. This process is called_____________.
Answer

Sequestration

Venire

Venue selection

Voir dire
2 points 
Question 14
 
The requirement that someone have a personal stake or interest in the outcome of a case in order to be a plaintiff is called _________________ to sue.
Answer

Standing

Validation

Grounds

Jurisdiction
2 points 
Question 15
 
Lawyers traditionally have a limited number of opportunities to reject potential jurors without having to give a reason. These are known as _______________challenges (or strikes.)
Answer

For cause

Discriminatory

Peremptory

Diversity
2 points 
Question 16
 
Procedural and evidentiary rules are much less rigid in courts of law than in arbitration proceedings.
Answer
True
False
2 points 
Question 17
 
Businesses are more and more likely to submit disputes to arbitration because it is less time consuming and costly than litigation.
Answer
True
False
2 points 
Question 18
 
The vast majority of disputes in our society are settled without recourse to either arbitration or litigation.
Answer
True
False
2 points 
Question 19
 
The legal term for referring an issue to arbitration is
Answer

Tender

Surrender

Submission

Subrogation
2 points 
Question 20
 
Which of the following statements about arbitrators is correct?
Answer

Arbitrators must be judges because their decisions are legally binding.

Arbitrators must be certified by the local Better Business Bureau.

Arbitrators are often members of the American Arbitration Association.

Arbitrators must be masters in chancellery because arbitration panels are annexed to courts of equity.
2 points 
Question 21
 
The federal government has exclusive control over all aspects of private and commercial aviation in the United States. This is an example of the federal government’s power to _______________an area of regulation.
Answer

Usurp

Preempt

Occlude

Dominate
2 points 
Question 22
 
Which of the following is the doctrine of substantive due process designed to address?
Answer

Violations of fundamental rights, such as voting and interstate travel

Seizures of private property for non-public use

Punishments without notice and a hearing

Laws that deny defendants an appeal of right
2 points 
Question 23
 
Under which standard of review would a court hear a case involving government regulation of commercial speech?
Answer

Strict scrutiny

Intermediate scrutiny

Rational basis

Commercial practicality
2 points 
Question 24
 
Assume that State University institutes a curfew for the female students who live on campus. To protect both the safety and morals of its female population, State University requires that the female students be in their dorms by 1:00 a.m. every night. There is no curfew for male students because they are less likely to be victims of attacks. If Nellie Nightowl wants to protest, which provision of the Constitution will she claim is being violated?
Answer

The Privileges and Immunities Clause

The Savings Clause

The Due Process Clause of the 5thAmendment

The Equal protection Clause of the 14thAmendment
2 points 
Question 25
 
In order to protect the health and welfare of its residents, Maryland has a law requiring that all public swimming pools be tested daily for bacteria. Maryland passed this law pursuant to its ________________powers.
Answer

Protective

Enumerated

Enabling

Police
2 points 
Question 26
 
An American company cannot be liable for violating American anti-trust laws if the activity complained of takes place in another country.
Answer
True
False
2 points 
Question 27
 
The process whereby a government takes control of private property in a way that is illegal under international law is________________.
Answer

Confiscation

Expropriation

Condemnation

Regionalization
2 points 
Question 28
 
The provision in the Foreign Corrupt Practices Act that allows an American company to make personal payments to clerks and other low level government employees in foreign countries is what type of exception?
Answer

Black list

De minimis

Grease payment

Countervailing exchange
2 points 
Question 29
 
The federal government can control what goods are imported into the United States but not what goods are exported to foreign countries.
Answer
True
False
2 points 
Question 30
 
What is an IBE?
Answer

Any business entity with relationships that transcend national boundaries

One of the courts in The Hague that settles disputes between businesses of different countries

A choice of law clause in an international contract

A transaction in violation of the International Commercial Code
2 points 
Question 31
 
Anna and Frank are leaving their jobs at Big Firm to start a company of their own. Which of the following may they do legally to start up their new enterprise?
Answer

Notify their clients at Big Firm that they leaving to start their own business

Offer Big Firm’s clients deep discounts if they transfer their business to the new firm

Try to get co-workers at Big Firm to quit and come to
 work for them

Both a and b
2 points 
Question 32
 
One advantage to doing business as a standard corporation is that profits “pass through” to the shareholders and are taxed only at the owner level.
Answer
True
False
2 points 
Question 33
 
The loan from a bank to a start-up enterprise is an example of equity financing.
Answer
True
False
2 points 
Question 34
 
Al, Beth, and Cal are wealthy individuals who invested $150,000 each in a start-up LLC. These investments are classified as _________financing for the business.
Answer

Equity

Debt

Contingent

Ancillary
2 points 
Question 35
 
Courts will not enforce provisions in contracts that violate public policy.
Answer
True
False
2 points 
Question 36
 
The insanity defense that allows someone to avoid criminal liability if the criminal act was the “product of a mental disease or defect” is the _____________rule.
Answer

Irresistible impulse

But…for

Durham

Right from wrong
2 points 
Question 37
 
Acts which are wrongful in themselves and prohibited by almost all civilizations are classified as ______________crimes.
Answer

Malum prohibitum

Malum in se

Specific intent

Mens rea
2 points 
Question 38
 
Embezzlement is an example of a white collar crime.
Answer
True
False
2 points 
Question 39
 
In prosecuting insider trading cases, the government often identifies people who were given “tips” to buy a certain stock from friends who worked for the corporation and were thus privy to inside information. Both the insider (the “tipper”) and the “tippee” have criminal liability. The government may promise that it will not prosecute the “tippee” if he testifies against the insider at trial. This is an example of________________.
Answer

Immunity

Entrapment

Strict liability

Government overreaching
2 points 
Question 40
 
The standard of proof for issuing a search warrant is clear and convincing evidence.
Answer
True
False
2 points 
Question 41
 
To be liable for intentional infliction of emotional distress a defendant must have engaged in conduct that was outrageous and completely intolerable to the community.
Answer
True
False
2 points 
Question 42
 
The purpose of criminal law is to punish while the purpose of tort law is to compensate the victim.
Answer
True
False
2 points 
Question 43
 
What is the difference between libel and slander?
Answer

Libel is a written communication, and slander is an oral communication.

Libel is also a felony, but slander is not.

Libel requires that plaintiff prove malice on the part of the defendant, but slander does not.

Businesses can only sue for defamation based on libel, not slander.
2 points 
Question 44
 
A construction company that damaged the property of others while blasting would be liable in strict liability.
Answer
True
False
2 points 
Question 45
 
Competitor wrongfully claims that one of the ingredients used in the manufacture of Hungry Dog dog food contains melanine, which is poisonous to animals. Competitor has committed the tort of____________.
Answer

Nuisance

Disparagement

Invasion of privacy

Wrongful interference with a contractual relationship
2 points 
Question 46
 
Beth invited friends for a BBQ and touch football game in her backyard. Roger, one of her guests, broke his ankle when his foot slipped into a hole as he ran out for a pass. Several malfunctioning sprinkler heads have been removed from the lawn for repairs, leaving dangerous, but hidden, holes. In common law, would Beth be liable to Roger for his injuries?
Answer

Yes, she had a duty to warn him of hidden dangers.

Yes, she is liable in strict liability.

No, her only duty to Roger was not to entrap him on the property.

No, as an adult Roger is presumed to have the legal ability to take care of himself.
2 points 
<
h3>Question 47
 
The “state of the art” defense is available to any manufacturer in a product liability suit based on strict liability
Answer
True
False
2 points 
Question 48
 
Whether or not a doctor acted negligently is a question of fact for a jury to decide.
Answer
True
False
2 points 
Question 49
 
Assume that Sussex County has a law requiring that all passenger elevators be inspected every six months. Local Hospital failed to have its passenger elevator inspected when required, and a door that malfunctioned injured a hospital visitor. Visitor’s attorney will use the doctrine of ________________to show that Local Hospital breached a duty of care.
Answer

Res ipsa loquitur

Negligence per se

Malpractice

Contributory negligence
2 points 
Question 50
 
To which of the following can the development of negligence law in the nineteenth century can be traced?
Answer

Population increases

Increased travel opportunities for individuals

More and more manufacturers creating more types of products

Widespread land reform laws
2 points 
Question 51
 
Nellie Neighbor made the following offer to two students who lived next door: “I will give you each $50 if you come to my house and move some furniture for me on Saturday.” To accept this offer, what should the students do?
Answer

Make an oral promise to move the furniture on Saturday.

Give Nellie a written promise to move the furniture on Saturday.

Wait a statutory three days after the offer, then give Nellie a written promise to move the furniture on Saturday.

Go to Nellie’s house on Saturday and move the furniture.
2 points 
Question 52
 
A plaintiff may be awarded either compensatory damages or consequential damages, but not both.
Answer
True
False
2 points 
Question 53
 
The person who makes an offer to form a contract is the ______________.
Answer

Maker

Donor

Offeror

Offeree
2 points 
Question 54
 
Quantum meruit refers to the compensation owed a party under an express contract.
Answer
True
False
2 points 
Question 55
 
If the seller of a parcel of real property breaches and refuses to sell, the best legal remedy for the buyer who wants this particular piece of property is
Answer

Compensatory damages

Consequential damages

Specific performance

Restitution
2 points 
Question 56
 
What must be used in an accord and satisfaction to discharge the obligations due under a contract?
Answer

The performance due under the contract must be in dispute.

A court of equity must approve the proposed accord.

The performance called for in the accord must be completed.

A and c
2 points 
Question 57
 
Manny Manufacturer agreed to buy widgets from Supplier only on the condition that the widgets would be delivered in ten days time. When Supplier could not meet the delivery date, Manny agreed to accept the widgets one week later. Manny’s acceptance of a different performance date under this contract is a/an _________________of the original condition.
Answer

repudiation

revocation

waiver

withdrawal
2 points 
Question 58
 
Unless expressly stated otherwise, contracts for the sale of goods assume that the seller’s duty to tender goods and the buyer’s duty to pay are _______.
Answer

constructive conditions precedent

constructive conditions subsequent

constructive conditions concurrent

the Code imposes no constructive conditions
2 points 
Question 59
 
All contracts that are performed in installments are legally classified as divisible contracts.
Answer
True
False
2 points 
Question 60
 
Carl had a contract to deliver six hundred yards of carpeting to Renovator for installation in an office complex. Three days before the delivery date, Carl called to say that he would not be able to deliver the carpeting “any time in the near future.” Assume that Carl learns that he can procure the needed carpeting after all and wants to reinstate the contract. What rights does Carl have in these circumstances?
Answer

Carl has an absolute right to retract the repudiation anytime before the perfo
rmance date.

Carl is bound by his repudiation and may not retract it under any circumstances.

Carl may retract the repudiation unless Renovator has indicated that he is treating it as final.

Carl may retract the repudiation at will, but he must be acting in good faith.
2 points 
Question 61
 
Matt is employed as the manager of Local Steak House, with wide-ranging responsibilities for all aspects of the business. What is Matt’s position?
Answer

General agent

Special agent

Broker

Factor
2 points 
Question 62
 
Bill hired Acme Paving to pave his driveway. Acme is Bill’s __________________.
Answer

broker

independent contractor

factor

special agent
2 points 
Question 63
 
If the agent dies, the agency agreement terminates by operation of law.
Answer
True
False
2 points 
Question 64
 
If an agency agreement does not state how much an agent is to be paid, what results?
Answer

The agency agreement is void.

The agency agreement is voidable by the agent, but not by the principal.

The agent is assumed to be a gratuitous agent.

A court will read in a reasonable amount based on the customary rate in the business community.
2 points 
Question 65
 
Which of the following isnotan example of a trade secret?
Answer

A business’s marketing plans for the next five years

A list of customers that was published in an ad in a trade journal

The formula for a compound used in a manufacturing process

The responses of a focus group to a company’s product that have been gathered and analyzed
2 points 
Question 66
 
Parker is a dealer in Oriental antiques and rugs. A sign in his store recommends that customers bring in their rugs to him for cleaning and repair. In fact, Parker does none of the cleaning or repair work himself. He sends the rugs to Local Cleaners, for whom he works as an agent making a 20 percent commission. Due to a mishap at Local’s plant, the rug belonging to Parker’s customer was damaged. Is Parker liable to the customer for the damage?
Answer

No, Parker is Local’s agent and has no fiduciary duties to third parties.

No, Parker has no liability because he was acting within the scope of this authority as Local’s agent.

No, Parker has no liability because agents are not responsible for the torts of the principal.

Yes, Parker is liable because he is the agent of an undisclosed principal.
2 points 
Question 67
 
It is the duty of an agent to notify third parties when his agency is terminated.
Answer
True
False
2 points 
Question 68
 
A principal has the duty to notify third parties when an agency terminates.
Answer
True
False
2 points 
Question 69
 
Whether or not a principal has ratified a contract is a question of law to be decided by the judge at trial.
Answer
True
False
2 points 
Question 70
 
Alan is the general manger of a restaurant. Although not mentioned in his employment contract, as part of carrying out his management duties he has the authority to buy supplies, hire employees, put ads on the radio, engage a cleaning service, pay bills, etc. These duties are expressions of his _____________authority.
Answer

actual express

actual implied

actual apparent

constructive implied
2 points 
Question 71
 
Whether or not a servant was acting in the scope of his employment when he injured a third party is a question of __________ to be decided by the ______.
Answer

fact…judge

law…judge

fact…jury

law…jury
2 points 
Question 72
 
A master can normally avoid liability for damages caused by a servant if he can show that the servant misunderstood his instructions.
Answer
True
False
2 points 
Question 73
 
ERISA requires that all employers with more than fifteen employees provide health insurance for the employees.
Answer
True
False
2 points 
Question 74
 
Which of the following statements about employer-funded pension and health benefit plans istrue?
Answer

Employers are required by federal law to provide
health insurance for their employees.

Employers are required by federal law to provide pension plans for their employees.

Employer pension plans are subject to numerous federal reporting and disclosure laws.

Both a and b
2 points 
Question 75
 
Employers who violate OSHA regulations are subject to fines and, if the violations are willful, imprisonment.
Answer
True
False
2 points 
Question 76
 
Under the National Labor Relations Act, businesses maynotdo which of the following?
Answer

Prevent workers from forming a union

Discriminate against workers for joining a union

Lay off workers in business downturns without the approval of two-thirds of the workers in a shop vote

Both a and b
2 points 
Question 77
 
The good cause exception to employment at will arises during the course of a worker’s employment based on the way the employer evaluates rewards and disciplines the employee.
Answer
True
False
2 points 
Question 78
 
Which of the following category of worker isnotcovered by the National Labor Relations Act?
Answer

Employees of the federal government

Employees of state governments

Independent contractors

The National Labor Relations Act covers none of the above.
2 points 
Question 79
 
To be protected by the public policy exception to employment at will, the public policy that the employee acts to advance must be tied to a constitutional, statutory or administrative law.
Answer
True
False
2 points 
Question 80
 
What act did Congress pass for the purpose of guaranteeing uniformity and fairness to all who are called to deal with federal administrative agencies?
Answer

Administrative Procedure Act

Consumer Protection Act

Occupational Safety and Health Act

Equal Protection Act
2 points 
Question 81
 
Which of the following protects the confidentiality of private information collected by federal government agencies and provides a mechanism for citizens to correct information that was submitted to an agency?
Answer

Privacy Act of 1974

Executive Privilege

Federal Reserve Act

Clayton Act.
2 points 
Question 82
 
The party against whom an administrative complaint is filed is the _____, who is afforded the right to respond to the complaint in writing.
Answer

petitioner

appellant

plaintiff

respondent
2 points 
Question 83
 
Which act did Congress pass with the purpose of empowering private citizens with tools to request information from the federal government?
Answer

Truth in Lending Act

Consumer Protection Act

Freedom of Information Act

National Labor Relations Act
2 points 
Question 84
 
Which of the following requires a court to overturn a newly crafted agency rule only when there is a showing of no factual basis for the rule?
Answer

Clear and convincing evidence standard

Substantial factor test

Arbitrary and capricious test

The preponderance of the evidence standard
2 points 
Question 85
 
Courts provide administrative agencies significant discretion to ________.
Answer

regulate in their area of expertise

overturn judicial precedent

disregard contractual language

interpret the U.S. Constitution
2 points 
Question 86
 
Courts will apply the _________ when they give no deference to the administrative agency decision and make an independent determination of the facts after performing a new hearing.
Answer

arbitrary and capricious test

blue-pencil rule

de novo test

clear and convincing evidence standard
2 points 
Question 87
 
An act of Congress that forbids creditors from discriminating against potential debtors on the basis of selected attributes is the ________.
Answer

Truth in Lending Act

Equal Credit O
pportunity Act

Sherman Act

Equal Protection Act
2 points 
Question 88
 
The Fair Credit Reporting Act requires the person who is the target of a credit inquiry to consent to the disclosure of his or her credit information.
Answer
True
False
2 points 
Question 89
 
One purpose of the Consumer Product Safety Act is to establish which of the following for consumer products?
Answer

Safety standards

Judicial precedent

Recommendations

New ideas
2 points 
Question 90
 
An act of Congress that controls the gathering, preservation and reporting of credit-related information is the ________.
Answer

Truth in Lending Act

Equal Protection Act

Equal Credit Opportunity Act

Fair Credit Reporting Act
2 points 
Question 91
 
The Fair Credit Billing Act provides a mechanism for consumers to remedy errors received on which of the following?
Answer

Credit card bills

Loan applications

Bank statements

Financial statements
2 points 
Question 92
 
Under the Equal Credit Opportunity Act, creditors are forbidden from making statements to applicants that would discourage them from applying for credit.
Answer
True
False
2 points 
Question 93
 
To establish a claim for deceptive advertising, its must be proven that actual customers were mislead into purchasing the product.
Answer
True
False
2 points 
Question 94
 
________ are the maximum allowable amount of exposure to major pollutants in outdoor air.
Answer

Public nuisance standards

Toxicology standards

National ambient air quality standards

Climate control standards
2 points 
Question 95
 
A ______ is a plan that each state creates and implements for the purpose of meeting national ambient air quality standards.
Answer

comprehensive zoning plan

state implementation plan

Clean Air Act

Blue Sky Law
2 points 
Question 96
 
The Clean Water Act was enacted to make water clean enough for swimming and other recreational purposes.
Answer
True
False
2 points 
Question 97
 
The principal source of the sulfur dioxide and nitrogen oxide found in acid rain comes from ________.
Answer

car emissions

oil and natural gas refineries

coal burning power plants

fertilizer run-off
2 points 
Question 98
 
Corporate officers may be imprisoned for knowingly violating the Clean Air Act.
Answer
True
False
2 points 
Question 99
 
When addressing environmental concerns, administrative agencies have no role in the process of regulating business.
Answer
True
False
2 points 
Question 100
 
What theory suggests that chemical changes in the atmosphere brought about by pollutants cause a rise in atmospheric temperatures?
Answer

The tipping point theory

The greenhouse effect

Darwinism

Environmental objectivism
2 points 
Question 101
 
I have neither received or given any assistence either to or from any third party concerning the content or answers prior to or after the completion of this exam.
Answer
True
False
	

economics data bank

Question
	
PROBLEM



 1. A snack food manufacturer buys corn for
tortilla chips from two cooperatives, one in Iowa and one in Illinois. The
price per unit of the Iowa corn is $5.50 and the price per unit of the Illinois
corn is $6.00.


 

 

 
a.
 
 

 
Define variables that would tell how many units to purchase from each
 source.
 

 

 

 
b.
 
 

 
Develop an objective function that would minimize the total cost.
 

 

 

 
c.
 
 

 
The manufacturer needs at least 12000 units of corn. The Iowa
 cooperative can supply up to 8000 units, and the Illinois cooperative must
 supply at least 6000 units. Develop constraints for these conditions.
 







 2. The relationship d = 5000- 25p describes what happens to demand (d)
as price (p) varies. Here, price can vary between $10 and $50.


 

 

 
a.
 
 

 
How many units can be sold at the $10 price? How many can be sold at
 the $50 price?
 

 

 

 
b.
 
 

 
Model the expression for total revenue.
 

 

 

 
c.
 
 

 
Consider prices of $20, $30, and $40. Which price alternative will
 maximize total revenue? What are the values for demand and revenue at this
 price?
 











 3. There is a fixed cost of $50,000 to start a
production process. Once the process has begun, the variable cost per unit is
$25. The revenue per unit is projected to be $45.


 

 

 
a.
 
 

 
Write an expression for total cost.
 

 

 

 
b.
 
 

 
Write an expression for total revenue.
 

 

 

 
c.
 
 

 
Write an expression for total profit.
 

 

 

 
d.
 
 

 
Find the break-even point.
 











 4. An author has received an advance against
royalties of $10,000. The royalty rate is $1.00 for every book sold in the
United States, and $1.35 for every book sold outside the United States. Define
variables for this problem and write an expression that could be used to
calculate the number of books to be sold to cover the advance.







 5. A university schedules summer school courses
based on anticipated enrollment. The cost for faculty compensation,
laboratories, student services, and allocated overhead for a computer class is
$8500. If students pay $420 to enroll in the course, how large would enrollment
have to be for the university to break even?





 6. As part of their application for a loan to
buy Lakeside Farm, a property they hope to develop as a bed-and-breakfast
operation, the prospective owners have projected:




 

 

 
Monthly fixed cost (loan payment, taxes, insurance, maintenance)
 
 

 
$6000
 

 

 

 
Variable cost per occupied room per night
 
 

 
$ 20
 

 

 

 
Revenue per occupied room per night
 
 

 
$ 75
 






 

 

 
a.
 
 

 
Write the expression for total cost per month. Assume 30 days per
 month.
 

 

 

 
b.
 
 

 
Write the expression for total revenue per month.
 

 

 

 
c.
 
 

 
If there are 12 guest rooms available, can they break even? What
 percentage of rooms would need to be occupied, on average, to break even?
 











 



 7. Organizers of an Internet training session
will charge participants $150 to attend. It costs $3000 to reserve the room,
hire the instructor, bring in the equipment, and advertise. Assume it costs $25
per student for the organizers to provide the course materials.


 

 

 
a.
 
 

 
How many students would have to attend for the company to break even?
 

 

 

 
b.
 
 

 
If the trainers think, realistically, that 20 people will attend, then
 what price should be charged per person for the organization to break even?



8. In
this portion of an Excel spreadsheet, the user has given values for selling
price, the costs, and a sample volume. Give the cell formula for

 

 

 
a.
 
 

 
cell E12, break-even volume.
 

 

 

 
b.
 
 

 
cell E16, total revenue.
 

 

 

 
c.
 
 

 
cell E17, total cost.
 

 

 

 
d.
 
 

 
cell E19, profit/loss.
 


 

 

 

 
 

 
A
 
 

 
B
 
 

 
C
 
 

 
D
 
 

 
E
 

 

 

 
1
 
 

 

 
 

 

 
 

 

 

 

 

 
2
 
 

 

 
 

 

 
 

 

 

 

 

 
3
 
 

 

 
 

 

 
 

 

 

 

 

 
4
 
 

 
Break-even calculation
 
 

 

 

 

 

 
5
 
 

 

 
 

 

 
 

 

 

 

 

 
6
 
 

 

 
 

 
Selling price per unit
 
 

 
10
 

 

 

 
7
 
 

 

 
 

 

 
 

 

 

 

 

 
8
 
 

 

 
 

 
Costs
 
 

 

 

 

 

 
9
 
 

 

 
 

 
 Fix cost
 
 

 
8400
 

 

 

 
10
 
 

 

 
 

 
 Variable cost per unit
 
 

 
4.5
 

 

 

 
11
 
 

 

 
 

 

 
 

 

 

 

 

 
12
 
 

 

 
 

 
Break-even volume
 
 

 

 

 

 

 
13
 
 

 

 
 

 

 
 

 

 

 

 

 
14
 
 

 

 
 

 
Sample calculation
 
 

 

 

 

 

 
15
 
 

 

 
 

 
 Volume
 
 

 
2000
 

 

 

 
16
 
 

 

 
 

 
 Total revenue
 
 

 

 

 

 

 
17
 
 

 

 
 

 
 Total cost
 
 

 

 

 

 

 
18
 
 

 

 
 

 

 
 

 

 

 

 

 
19
 
 

 

 
 

 
 Profit loss