BUS 508 EXAM 2 WEEK 5/BUS 508 EXAM 2 WEEK 5

Question 1 

One effect of the North American Free Trade Agreement (NAFTA) is:

Answer 

an increase in trade among the NAFTA member nations

an increase in the number of low-wage jobs in the United States

a decrease in trade among NAFTA member nations

an increase in trade restrictions among the member nations

Question 2 

A country raises the tariff on imported cheese in order to increase its price above the price of domestically produced cheese. This is an example of ________.

Answer 

an exchange control

an import quota

a protective tariff

dumping

Question 3 

A trade deficit occurs when ________.

Answer 

imports are sold at low profits

foreign-aid payments exceed exports

imports exceed exports

there is a net flow of money into a country

Question 4 

Los Angeles-based PMI Telecom purchases cell phones manufactured in Asia and sells them in the United States. PMI is engaging in the international business activity known as ________.

Answer 

exporting

importing

countertrade

dumping

Question 5 

Dumping _________ domestic consumers and _________ domestic producers.

Answer 

harms, benefits

harms, harms

benefits, harms

benefits, benefits

Question 6 

A balance of payments deficit occurs when ________.

Answer 

the net inflow of money from abroad exceeds the net outflows of money to other countries

imports exceed exports

the net outflow of money from a country exceeds the net inflow of money from abroad

exports exceed imports

Question 7 

An absolute advantage occurs when a country can maintain ________.

Answer 

a monopoly by outlawing foreign imports

a monopoly by levying high taxes on imports

a monopoly by being the lowest-cost producer of a good or service

its advantage by producing a good or service more efficiently

Question 8 

During the past decade, which of the following countries has experienced the greatest annual rate of GDP growth?

Answer 

United States

China

Canada

Japan

Question 9 

A country with a balance of payments surplus means ________.

Answer 

monetary inflow exceeds monetary outflow

monetary outflow exceeds monetary inflow

imports exceed exports

exports exceed imports

Question 10 

The ________ industry represents the greatest percentage of minority-owned businesses.

Answer 

Finance

Service

Retail

transportation

Question 11 

If business owners in a partnership wish to limit liability, they have the option to ________.

Answer 

pledge funds

divide into sole proprietorships

set up a limited partnership

withhold funds

Question 12 

Many businesses fail during the early years because of ________.

Answer 

niche marketers

inadequate financing

unmotivated owners

poor planning

Question 13 

The majority of all U.S. firms employ:

Answer 

more than 5,000 employees

1,000 to 3,000 employees

3,000 to 5,000 employees

500 or fewer employees

Question 14 

If you are considering starting your own business, a key priority for you should be to:

Answer 

get a loan from your local bank

incorporate your business.

learn the basics of business.

apply for a Small Business Administration loan.

Question 15 

McDonalds offers a contractual business arrangement in various countries around the world. McDonalds is an example of a(n) international ____________.

Answer 

franchise

acquisition

Merger

not-for-profit corporation

Question 16 

If you are a highly independent individual used to having your own way, the best business format for you is a ________.

Answer 

partnership

corporation

sole proprietorship

limited liability corporation

Question 17 

________ newly-launched businesses fail within two years after commencing operations.

Answer 

Less than one in ten

About one of every three

About half of all

Almost all

Question 18 

Louis works as an artist for a major textile company and created an innovation for producing designs. The company will implement Louis’s idea as part of its ________ strategy.

Answer 

skunkworks

angel investment

seed capital

entrepreneurship

Question 19 

Which of the following is an example of a country with a factor-driven economy with an average of over 10% of its adults starting or managing a new business?

Answer 

Thailand

United States

Bangladesh

Hong Kong

Question 20 

After starting a web design company while still in college, Rodrigo sold the company after graduation. He then opened a computer repair shop; and most recently, he has started a marketing firm that specializes in social media. Rodrigo is an example of a(n):

Answer 

serial entrepreneur.

social entrepreneur.

lifestyle entrepreneur.

classic entrepreneur.

Question 21 

Franz and Arlene had an idea for a different type of ice cream. They struggled to open their own small business, and later, to expand production and distribution. Their products are distributed nationwide and their sales continue to increase. Franz and Arlene are examples of ________.

Answer 

serial entrepreneurs

classic entrepreneurs

change agents

social entrepreneurs

Question 22 

Financial success ________.

Answer 

rarely results from starting a business

is part of the appeal of becoming an entrepreneur

plays little role in motivating people to become entrepreneurs

is virtually guaranteed if people work hard enough starting their own businesses

Question 23 

Lisa is trying to start a new business. A women’s business network puts her in touch with an investor who is willing to invest in her company in exchange for an equity stake. This investor is a(n) ________.

Answer 

angel investor

franchiser

venture capitalist

entrepreneur

Question 24 

What makes entrepreneurs unique is their overwhelming desire to ________.

Answer 

become successful

utilize their creative energy

manage employees

make their business grow

Question 25 

Information technology can help entrepreneurs in all of the following ways EXCEPT:

Answer 

provide improved customer service.

ensure financial success.

work quickly and efficiently.

project a professional image.