Subject: Business    / Management    

Question
QUESTION 1

    No matter the size of a business, the leader sets the ________ for how the organization operates. If the leader is chaotic, chances are the business will be too. If the leader is well organized and efficient, the business may well be too.
    asset optimization
    expense constraints
    profit expectations
    tone/style

2 points


QUESTION 2

    Credit is ________.
    exemplified by purchasing a product to sell, and you don't have to pay until after you have sold it
    the ability to buy something without spending actual cash
    both of the above
    essentially using someone else's money for gain

2 points


QUESTION 3

    Relying primarily on debt financing is very dangerous for a company because ________.
    creditors can force a company into bankruptcy or take over company property
    creditors can sabotage the business by refusing to lend it money
    creditors can gain a majority share of the company and take it over
    it can be very stressful for the owners, thus causing them to make mistakes

2 points


QUESTION 4

    What did Ray Kroc do, when he franchised McDonald's, that set the bar for future franchise operations?
    He provided training and support to franchisees to ensure that quality would be consistent in every McDonald's restaurant.
    He licensed the McDonald's name to a wide variety of products such as hats and shirts.
    He sold franchises in competing territories to encourage franchise owners to compete and come up with innovations for the company.
    He improved the quality of hamburgers and customer service

2 points


QUESTION 5

    If the amount of cash that flows in and out of your business changes significantly during certain times of the year, you should include ________ in your business plan.
    a cash flow statement
    a projected cash flow statement
    a seasonality scenario
    a flow chart

2 points


QUESTION 6

    Some contracts specify that conflicts may be settled through ________ instead of court.
    negotiation
    coercion
    arbitration
    small claims

2 points


QUESTION 7

    No matter what way you approach raising money for your business, you will need a ________.
    written business plan
    family investment
    winning lottery ticket
    bank loan

2 points


QUESTION 8

    Which of the following is not necessary for a contract to be binding?
    Signing parties must exchange something of value or agree not to do something they are legally entitled to do.
    Signing parties must have their signatures notarized.
    Both parties must sign the contract.
    None of the above

2 points


QUESTION 9

    Employees who feel used by their company ________.
    may exhibit negative behaviors to customers
    will not do their best
    may quit the business
    all of the above

2 points


QUESTION 10

    A ________ is a business that markets a product or service in the exact manner prescribed by the person who developed the business.
    portfolio extension
    franchise
    license
    none of the above

2 points


QUESTION 11

    Entrepreneurs use a(n) ________ to track assets and liabilities.
    income statement
    cash flow statement
    balance sheet
    profit and loss

2 points


QUESTION 12

    Orders are not entered onto the cash flow statement as cash receipts because you ________.
    don't get the cash until the customer actually pays for the order
    might get them confused with revenue on the income statement
    will have a more accurate cash flow statement if you enter them once a month
    might get a cancellation

2 points


QUESTION 13

    Which of the following is not a type of community development loan fund?

    community development banks

    public employee credit union

    community development credit unions

    venture capital

2 points


QUESTION 14

    ________ are the building blocks of business.
    Letters of agreement
    Contracts
    Personal relationships
    Customer services

2 points


QUESTION 15

    Bonds are a form of ________.
    debt financing
    equity financing
    both of the above
    none of the above

2 points


QUESTION 16

    Corporate, partnership, individual income tax, and __________ tax returns must be filed on time with the U.S. Internal Revenue Service.
    state
    local city or county
    self-employment
    township

2 points


QUESTION 17

    The standards and rules in businesses that help someone decide right from wrong are called ________.
    corporate governance
    laws
    ethics
    morals

2 points


QUESTION 18

    This is an exit strategy when an entrepreneur sells his or her company to its managers.
    a merger
    a management buy-out
    a management takeover
    an employee buy-out

2 points


QUESTION 19

    The time period in which legal action may be taken is the ________.
    limit of liability
    statute of legal obligations
    statute of limitations
    none of the above

2 points


QUESTION 20

    You purchase $250,000 worth of insurance to protect your restaurant with a $10,000 deductible. How much money are you entitled to receive as a payout if a fire destroys your store, which is valued at $250,000?
    $240,000
    $10,000
    $250,000
    $ $240,000 less copayment

2 points


QUESTION 21

    What are the two steps in making a cash flow projection?
    projecting receipts and paying bills before they are due
    projecting expected cash expenses and subtracting inventory cost
    projecting cash receipts and subtracting expected cash expenses
    projecting receipts and capital expenditures for a quarter

2 points


QUESTION 22

    Which of the following is not a role of management according to the acronym POLDSCCRIM?
    planning
    staffing
    optimizing
    innovating

2 points


QUESTION 23

    The greater the potential reward, ________.
    the riskier the investment is likely to be
    the more the investment is likely to cost
    the less risky the investment is likely to be
    the longer it will take to show a return

2 points


QUESTION 24

    Cash itself or items that could be quickly turned into cash or will be used within one year are called ________.
    liquid assets
    long-term assets
    current assets
    liquid cash

2 points


QUESTION 25

    If a business owner wants his or her pay to be a variable operating cost, a ________ is most appropriate.
    bonus
    wage
    salary
    commission

2 points


QUESTION 26

    Some federal agencies provide grants, loans, and/or loan guarantees for businesses that meet specific criteria. One of these is the United States ________.
    Interstate Commerce Commission (ICC)
    Small Business Administration (SBA)
    Federal Land Bank (FLB)
    Agricultural Extension Agency (AEA)

2 points


QUESTION 27

    A ________ is the amount of loss or damage that you agree to cover before any insurance coverage takes over.
    deductible
    carrying cost
    premium
    co-insurance

2 points


QUESTION 28

    ________, an American economist, argued that business should focus on making quality products instead of maximizing profits and that profit would follow.
    Conrad Hilton
    W. Edwards Deming
    Paul Samuelson
    Adam Smith

2 points


QUESTION 29

    If you want to buy a business that is growing rapidly, what is the best valuation method to use to determine a fair price for it?
    book value method
    market-based approach
    future earnings method
    pay-back method


QUESTION 30

    A(n) ________ rate of return means that interest is earned on the base amount plus any interest previously earned.
    compound
    accrued
    annual
    fixed

 

QUESTION 31

    Which of the three financial statements that an entrepreneur prepares is used to guide the day-to-day operations of the business?
    the cash flow statement
    the income statement
    the balance sheet
    tax returns

 

QUESTION 32

    _______ = Cash on Hand + Cash Receipts–Cash Disbursement.
    Profit
    Revenue
    Cash flow
    Gross profit


QUESTION 33

    Research indicates that ________ is the most important characteristic required for successful leadership.
    self-esteem
    business knowledge
    drive
    intelligence

 

QUESTION 34

    Lost sales and goodwill are potentially significant costs that may arise from ________.
    too little inventory
    too much inventory
    either too little or too much inventory
    poor customer service with inventory

 

QUESTION 35

    The number of stockholders in a Subchapter S Corporation is limited to ________.
    75
    50
    12
    250

 

QUESTION 36

    The inventory method in which you look at the inventory on hand, and when the stock level of an item appears to be low, you reorder is called ________.
    basic control
    proximal management
    estimation
    visual control

 

QUESTION 37

    Businesses typically sell for several times their income because the future stream of income is being sold. The price of the business is its ________.
    five times earnings
    future value
    present value
    tangible and intangible value


QUESTION 38

    The statistical methods, within Six Sigma, are designed to eliminate defects to a failure rate of ________ defects per one million opportunities, or a 99.9997% success rate.
    3.4
    34
    0.34
    .344


QUESTION 39

    Madam C. J. Walker was an entrepreneur who became ________.

    the first female pharmacist in America

    the first African-American businessperson to become a millionaire

    the first entrepreneur to franchise a business

    the first self-made female millionaire


QUESTION 40

    Licensing is ________.
    the right to sell knockoffs of a product
    the right to start a business and run it exactly as the licensor wants it to be run
    the right to operate a business
    renting your brand or other intellectual property to increase sales


QUESTION 41

    Which statement best describes how the cash flow statement differs from the income statement?
    The income statement records sales and expenses when they happen, not when cash is actually exchanged. The cash flow statement records cash inflows and outflows when they actually occur.
    The income statement records income, as it comes in, while the cash flow statement records cash from sales.
    The income statement keeps track of cash when sales are made; the cash flow statement keeps track of cash after sales are made.
    The cash flow statement also includes the current market value of assets.


QUESTION 42

    If you extend credit, it is critical to minimize which number to keep cash flowing?
    receivable turnover ratio
    inventory turnover ratio
    collection-period ratio
    debt-to-equity ratio


QUESTION 43

    An income statement shows whether the difference between revenues (sales) and expenses (costs) is a profit or a ________.
    loss
    net profit
    breakeven
    semi-loss


QUESTION 44

    The act of Congress that requires employers to pay men and women the same amount for the same work is called ________.
    The Equal Opportunity Act
    The Equal Pay Act
    The Work Compensation Act
    Anti-discrimination Act


QUESTION 45

    The three factors included in the calculation of the Reorder Point are ________.
    demand, lead time, and safety stock
    supply, price, and safety stock
    demand, inventory, and price
    supply, demand, and holding costs


QUESTION 46

    Ways to value a business include comparison to other firms, benchmarking, or looking at a multiple of net earnings. Any of these methods is an attempt to arrive at a ________.
    future value
    net present value
    fair market value
    profit maximizing price


QUESTION 47

    A brand is a combination of name, logo, and design that ________.
    identifies the owner of a company
    expresses the philanthropic intentions of a company to consumers
    puts people in the mood to buy the product or service
    becomes associated in the minds of consumers with the products or services of a company


QUESTION 48

    What is the difference between strategic planning and operational planning?
    Strategic plans are for one year or less and have very specific objectives, while operational plans are more vague and long-term.
    Strategic planning covers the short-term day-to-day workings of a business, while operational planning sets out long-term goals.
    Strategic planning sets out strategies for the business to achieve long-term growth and other goals, while operational planning covers the day-to-day operations of the business.
    Strategic planning is reserved for middle management in large companies.


QUESTION 49

    William Petty's article on harvesting quotes Steven Covey, who says ________.
    the key to being effective in life is "beginning with the end in mind"
    "your chance to sell or to merge typically occurs within the first two years of the life of the business"
    "you may have only one chance to harvest your business"
    None of the above


QUESTION 50

    Which of the following is not a potential penalty for breaking a contract?
    You may lose a share of the ownership of your business to the other party who signed the contract.
    You may be sued in a court of law by the other party who signed the contract.
    A court may order you to pay damages to the other party who signed the contract.
    It can be costly.