TestMidTermBnEAnswers

MIDTERM TEST BUSINESS AND ETHICS Page: 1

6-2. The management of a nonprofit organization is much the same as the management of small and large businesses.

Answer: True LG: 2/LL: 1 Page: 184

6-3. To be classified as a small business, a firm must have no more than 100 employees.

Answer: False LG: 2/LL: 1 Page: 184

6-4. According to the Small Business Administration’s definition, small businesses must be independently owned and operated.


6-5. A business is considered small by comparing its size to others in the same industry.


6-6. Small businesses create over 70% of the new jobs in the United States.


6-7. Small businesses account for over 40% of the gross domestic product (GDP) in the United States.


6-8. As a result of unfair treatment in the past, the growth of minority-owned business is slower than the rest of the population.


6-9. Women own more than one-third of all small businesses.


6-10. Of all nonfarm businesses in the United States, almost 97 percent are considered small by the Small Business Administration (SBA) standards.


Created: 03/2008 TEST


6-11. Large firms have a greater ability to provide personalized, fast response customer service than do small business organizations.


6-12. Big businesses don't serve all the needs of the market.


6-13. Conventional wisdom reports that half of all small businesses fail in their first four years of operations.


6-14. The principles of managing vary according to the size of the business.


6-15. The most common small business failures occur in businesses that are the easiest to start.


6-16. Only about 10% of all businesses qualify as small businesses using the definition of the Small Business Administration.


6-17. About 80 % of Americans find their first jobs in small businesses.


6-18. The number of women owning small businesses has grown slowly.


6-19. Many small businesses list the lack of qualified workers as one of their biggest obstacles to growth.


6-20. The small business sector that has the best chances of significant growth is legal services.




4-1.The Enron scandal illustrates the difference between unethical behavior and illegal behavior.


4-2.Ethical behavior requires more than following the law.


4-3.Legal behavior and ethical behavior are basically the same.


4-4.Many immoral and unethical acts fall well within our laws.


4-5.Ethical behavior refers to the standards that are accepted by society as right or wrong.


4-6.Ethical behavior requires individuals to decide for themselves what is right and wrong in each situation they face.


4-7.Given the level of diversity within the United States, agreement on common standards of ethical behavior is unachievable.




Level of Learning 2 (Understands concepts and principles)

4-8.An accurate statement regarding this chapter is "Business law establishes ethical behavior."


Rationale: The most basic step in ethical behavior is the law, but ethics go far beyond legality.

4-9.Legal behavior includes more aspects of our relationships with others than does ethical behavior.


Rationale: Legality is a more limiting term. Many immoral and unethical acts fall well within our laws.

4-10.Legal behavior is a first step toward ethical behavior.


Rationale: Ethical behavior requires more than following the law, but following the law is an important first step.

4-11.Laws that protect us from fraud, theft and violence determine ethical behavior.



4-12.Moral behavior refers to behavior that is accepted by society as right versus wrong.


Rationale: Ethics defines the standards of moral behavior, or the attempt to live by certain values and standards of conduct accepted by society as right and wrong.

4-13.Ethical behavior always treats others fairly.


Rationale: Ethical behavior focuses on proper relations with other people. An ethical person will treat others with honesty and sincerity. Perhaps the essence of this behavior is The Golden Rule, “do unto to others as you would have them do unto you.”



4-14.People involved in business may be tempted to do something unethical in order to increase sales and profits. However, if they are caught, our legal system will deal harshly with them.


Rationale: Many immoral and unethical acts fall well within our laws.

Learning Goal 2 Ask the three questions one should answer when faced with a potentially unethical action.

Level of Learning 1 (Knows basic terms and facts)

4-15.Ethical behavior involves the clear and easy choice of right and wrong actions towards others.


4-16.An ethical manager strives for a win-win relationship with others.


4-17.The question "Is it legal?" establishes ethical behavior.


4-18.Trying to make decisions that will benefit all parties involved is consistent with the question "How will it make me feel about myself?"

Answer: False LG: 2/LL: 1 Page: 104 - 105


4-19.While telling an abusive joke about an ethnic group may not be unlawful, it is unethical.


Rationale: Humor at someone else's expense is an example of unfair treatment of others.



4-20.An ethical manager’s decisions are based on the following questions: "Is it legal?" and "Is it profitable?"


3-1.Importing is the selling of products to another country.


3-2.Exporting involves the selling of products to another country.


3-3.The United States is the largest importer in the world.


3-4.The United States is the largest exporter in the world.


3-5.While Japan is the largest exporter in the world, the U.S. is the largest importer.


3-6.One reason countries trade with other countries is that even technologically advanced nations cannot produce all the products their people want and need.


3-7. Free trade is the movement of goods and services among nations without political or economic obstruction.


3-8.Global trade includes the exchange of goods and services between countries.




3-9. Absolute advantage is the basis for most global trade.


3-10. Comparative advantage theory states that a country should sell to other countries those products that it produces most efficiently and buy from other countries those products it cannot produce as efficiently.


Q10-1. Weldon Task has just successfully negotiated a new long-term sales agreement with a major client. The good feeling Weldon has about his efforts is his ________ reward. A) external B) extrinsic C) intrinsic. D) reciprocal

Q10-2. Which of the following statements is the best description of how scientific management viewed workers? A) Workers are like machines that must be programmed to perform in a certain

way. B) Most workers are creative and intelligent individuals who should be given a

great deal of freedom and flexibility in how they perform their jobs. C) Workers will only exert their maximum effort if they believe that their goals

are attainable. D) Workers are individuals who do not respond in the same way to a particular

management style.

Q10-3. The most important impact of the Hawthorne studies was that it: A) helped managers find the level of lighting associated with optimum

productivity. B) showed that workers could be programmed like machines to perform simple

repetitive tasks, and thus led to the development of assembly lines. C) changed the direction of research away from Taylor's scientific management

toward the study of human-based management. D) showed that physical working conditions have no impact on worker

productivity.

Q10-4. According to Maslow, a higher order need: A) always provides greater motivation than a lower order need. B) never provides as much motivation as a lower order need. C) becomes a source of motivation after lower order needs are satisfied. D) contributes directly to the physical survival of the individual.

Q10-5. According to Herzberg, a sense of achievement, earned recognition, and interest in the work itself were a A) important motivators. B) hygiene factors. C) ways for workers to meet their social needs. D) consistent with his Theory X approach to motivation.





Q10-6. Ramon works at Chicago Medical Instruments. His job was recently redefined so that he now has more flexibility in the hours he works and more say in the procedures used on the job. This suggests that Chicago Medical Instruments is trying to change Ramon's job so that it has more: A) feedback. B) autonomy. C) task identity. D) task significance.

Q10-7. At Quatritech International, employees tend to work with little direct supervision. They are expected to use creativity and imagination on the job because management believes they are committed and professional workers. The management style at Quatritech reflect ____________ attitudes about workers. A) Theory C B) Theory D C) Theory X D) Theory Y

Q10-8. ________ is a system of goal setting and implementation that involves a cycle of discussion, review, and evaluation of objectives among top and middle managers, supervisors, and workers. A) Objective planning B) Management by objectives C) The three step planning system D) Cyclical objective analysis

Q10-9. According to equity theory, which of the following statements is most accurate? A) The best way to motivate workers is to offer everyone the same reward. B) Workers perceptions of fairness will affect their level of motivation. C) Workers generally go a good job of estimating their contributions to a firm. D) In the United States, workers tend to focus on their own situation and pay

little attention to the efforts and rewards of other workers.

Q10-10. Which of the following statements about cultural differences in the workplace is most accurate? A) The best way to deal with cultural differences in the workplace is to treat

everyone the same way. B) Cultural differences were once a major problem, but television,

telecommunications, e-mail, and the Internet have brought people closer together and greatly reduced cultural differences.

C) Managers must be very aware of cultural differences and recognize that different employees may respond best to different management and motivational styles.

D) Only firms that hire a lot of foreign-born workers are likely to have problems dealing with cultural differences. Workers born in the United States tend to have a common set of values and attitudes, regardless of age or social background.



Answers to Quick Quiz for Chapter 10

Q10-1 (A) C p. 300 LG: 1/LL: 2

Q10-2 (A) A p. 301 LG: 1/LL: 3

Q10-3 (A) C p. 303 LG: 2/LL: 2

Q10-4 (A) C p. 304 LG: 3/LL: 1

Q10-5 (A) A p. 306 LG: 4/LL: 1

Q10-6 (A) B p. 308 LG: 5/LL: 2

Q10-7 (A) D p. 310 LG: 6/LL: 3

Q10-8 (A) B p. 313 LG: 7/LL: 1

Q10-9 (A) B p. 315 LG: 8/LL: 2

Q10-10 (A) C p. 320 LG: 9/LL: 3



WEEK 2-1. An entrepreneur: A) manages a business for someone else. B) owns controlling interest in the stock of a major corporation. C) manages a business that operates in more than one country. D) accepts the risk of starting and running a business.

WEEK 2-2. One way an intrapreneur differs from an entrepreneur is that: A) intrapreneurs start nonprofit organizations while entrepreneurs start profit-

seeking businesses. B) intrapreneurs are practical while entrepreneurs are creative. C) intrapreneurs work within existing corporations while entrepreneurs assume

the risks of starting their own business. D) intrapreneurs limit their efforts to financial investments, while entrepreneurs

are involved in all areas of business activity.

WEEK 2-3. When looking at the advantages and disadvantages of starting various types of businesses, it appears that: A) businesses that are easy to start often offer the greatest potential for long

term growth and profits. B) the greatest security is available in the manufacturing sector. C) businesses that offer a chance for high profits tend to be difficult to start and

hard to keep going. D) the reason the service sector is growing so rapidly is that service firms are

easy to start, easy to keep going, and offer both growth opportunities and plenty of security.

WEEK 2-4. Manny is about to graduate from college, and is looking for full time employment. He has decided to concentrate on looking for a job with a major corporation. His job search strategy: A) makes sense, because managerial skills can only be fully developed by

working for big firms. B) is smart because major corporations are still the most important source of

employment growth in the United States. C) indicates that Manny wants a chance to utilize his entrepreneurial talents. D) is likely to limit his job prospects since most new jobs are with small

businesses.

WEEK 2-5. An examination of statistics about people who start their own businesses reveals that: A) many small business owners got their entrepreneurial idea from a previous

job they held. B) it is rare for managers with experience working within big corporations to

start their own businesses. C) people who start their own businesses right after graduating from high school

or college are generally more successful than those who first work for someone else.

D) most small business owners have a great deal of personal wealth.



WEEK 2-6. Which of the following suggestions would an experienced entrepreneur most likely give to someone who is thinking about starting their own business? A) Starting a new business is always better than buying an existing firm. B) Even small businesses must keep accurate records. C) In order to keep costs low when the company is just getting started, wait at

least a year before hiring an accountant or lawyer. D) Prior business experience is not really important in managing a new firm.

WEEK 2-7. The primary focus in managing a new business should likely be: A) human relations and accounting. B) financing and planning. C) marketing and public relations. D) staffing and controlling.

WEEK 2-8. When seeking a loan from a bank, an entrepreneur hoping to start a new business should realize that bankers will: A) expect to receive a share of ownership in the business in exchange for their

loan. B) expect the entrepreneur to have a well prepared business plan. C) generally make loans only to small businesses in computer related

industries. D) offer only very short-term financing.

WEEK 2-9. Luis is a partner in a firm that specializes in producing vitamins and health food products. While the business is considered small by U.S. standards, he is attempting to persuade his partner to expand internationally. Luis would list all of the following as advantages of going international with the exception of: A) Exporting can absorb excess inventory. B) Marketing will encounter cultural similarities in prospective markets. C) Expanding internationally may lessen the impact of a downturn in the

domestic market. D) Selling your products in other markets may extend their life cycle.

WEEK 2-10. One of the main reasons why many American small businesses are not involved in global business transactions is: A) there is only a limited market for their products. B) the government has been against active participation. C) many potential exporters do not know how to get started. D) American products are looked upon as being inferior.



Answers to Quick Quiz for WEEK 2

WEEK 2-1 (A) D p. 174 LG: 1/LL: 1

WEEK 2-2 (A) C p. 181 LG: 1/LL: 2

WEEK 2-3 (A) C p. 186 LG: 2/LL: 2

WEEK 2-4 (A) D p. 184 LG: 2/LL: 3

WEEK 2-5 (A) A p. 187 LG: 3/LL: 1

WEEK 2-6 (A) B p. 195 LG: 3/LL: 2

WEEK 2-7 (A) B p. 189 LG: 4/LL: 1

WEEK 2-8 (A) B p. 189 LG: 4/LL: 2

WEEK 2-9 (A) B p. 197 LG: 5/LL: 3

WEEK 2-10 (A) C p. 197 LG: 5/LL: 1



WEEK 1-1. The __________________ is usually the easiest form of business to start and end. A) sole proprietorship B) limited partnership C) corporation D) cooperative

WEEK 1-2. Mara plans to open a shop specializing in foods and cultural items from the Middle East. She wants to be the firm's only general partner, but she is trying to get several friends to participate as limited partners. Apparently Mara wants to: A) limit her personal liability to the amount she personally invests in the

company. B) be the only person allowed to share in the firm's profits. C) obtain a strong financial base for the firm while maintaining personal control

over the firm's management. D) meet the legal requirements of the Uniform Partnership Act.

WEEK 1-3. Jamie and Maria invested all their savings in a small pizzeria they opened outside the University of Western Kentucky. They operated the business as a general partnership. After 11 months the business went broke and Jamie and Maria were left with outstanding bills of $37,500, which is more than their investment in the company. Jamie and Maria can: A) lose their personal assets as the result of their company's financial problems. B) lose only the funds they originally invested in their company. C) lose only the total value of the assets actually used to operate the business. D) avoid any liability for these debts since a partnership is considered to be a

business entity that is separate and distinct from the partners who own it.

WEEK 1-4. A separation between ownership and management is most likely to occur in a: A) sole proprietorship. B) general partnership. C) corporation. D) limited liability partnership.

WEEK 1-5. One reason limited liability companies have become so popular is that they: A) can be taxed either as a corporation or as a partnership, so owners can

choose the tax treatment that is most advantageous for their situation. B) allow owners to sell their interests in the company without requiring approval

from other owners. C) have unlimited life. D) allow owners to avoid paying self-employment taxes on the company's

profits.

WEEK 1-6. In a leveraged buyout, the managers of a firm, its employees, or other investors attempt to: A) move the company elsewhere and start over.



B) obtain the assets of the company through bankruptcy proceedings. C) use borrowed funds to buy out the firm's stockholders. D) negotiate a merger with another firm to create a conglomerate.



WEEK 1-7. Trans Globe Airlines has recently looked into a merger with Royal Blue Airlines, a financially troubled rival. The firms believe the merger will create a stronger company that can offer travelers more flights to a wider variety of destinations. This proposed merger is an example of a: A) conglomerate merger. B) leveraged buyout. C) horizontal merger. D) joint venture.

WEEK 1-8. An evaluation of franchising would conclude that this type of arrangement: A) has become the dominant form of business organization in the United States

because it has many advantages and almost no disadvantages. B) appeals to people who want to own a business, but are not comfortable

starting a company from scratch. C) has a much higher risk of failure than independent companies. D) has little chance of success outside the United States because many foreign

countries do not allow such arrangements.

WEEK 1-9. Midas Muffler sells franchises to prospective businesspersons who want to use the Midas name and offer Midas products. In a franchise arrangement, Midas would be the_____________, and the buyer of the franchise is the ____________. A) owner; limited partner. B) co-signer; co-signee. C) franchisor; franchisee. D) wholesaler; retailer.

WEEK 1-10. A ___________ is an organization that is owned and controlled by the people who use it—producers, consumers and workers with similar needs who pool their resources for mutual gain. A) corporation. B) limited partnership. C) mutual fund. D) cooperative.



Answers to Quick Quiz for WEEK 1

WEEK 1-1 (A) A p. 143 LG: 1/LL: 1

WEEK 1-2 (A) C p. 145 LG: 2/LL: 3

WEEK 1-3 (A) A p. 146 LG: 2/LL: 3

WEEK 1-4 (A) C p. 150 LG: 3/LL: 1

WEEK 1-5 (A) A p. 154 LG: 3/LL: 1

WEEK 1-6 (A) C p. 157 LG: 4/LL: 2

WEEK 1-7 (A) C p. 157 LG: 4/LL: 3

WEEK 1-8 (A) B p. 158 LG: 5/LL: 2

WEEK 1-9 (A) C p. 158 LG: 5/LL: 3

WEEK 1-10 (A) D p. 165 LG: 6/LL: 1

Working for the Best: The Container Store

Key People and CompaniesTodd McFarlane, CEO and Founder, The McFarlane Companies

Toying With Success: The McFarlane Companies

It’s in the Bag: Joe-to-GoKey People and CompaniesJerry Andrews, Founder and CEO of Joe-to-Go, and his wife Gretchen

Key People and CompaniesGarrett Boone, The Container Store; Elizabeth Bryant, Southwest Airlines; Matthew Emmert, The Motley Fool; Matt Hoffman, Hoffman Sports Association; Christopher Jones, HotJobs.com; Mark Karasu, Hotjobs.com; Sharon Larkin, Abbot Laboratories; Todd McFarlane, McFarlane Companies; Joseph Prochaska, AON; Scott Ross, Digital Domain; Reeta Roy, Abbott Laboratories

10-29. Abraham Maslow believed that motivation arises from the desire to satisfy unmet needs.




10-30. According to Maslow, it is impossible to rank human needs in any logical order.


10-31. According to Maslow, people will try to satisfy lower order needs before they turn their attention to higher order needs.




10-32. Safety needs are at the lowest level in Maslow's hierarchy of needs.


10-33. Maslow referred to the needs people had for recognition and acknowledgement from others as esteem needs.


10-34. According to Maslow, a satisfied need is no longer a motivator.


10-35. In Maslow's hierarchy, self-actualization needs are those needs associated with basic survival, such as the need for food and shelter.


10-36. Social needs are the highest level of needs in Maslow's hierarchy.


10-37. In Maslow's view, social needs include the need to feel loved and accepted.


10-38. Maslow believed that lower level needs may emerge at any time when they are not met and take our attention away from higher-level needs.


1-1. Starting a business is a riskier path toward business success than working your way up the ranks of a large business.


1-2. Paid vacations and health care insurance are among the benefits provided by the government to entrepreneurs.


1-3. Women currently own less than ten percent of all businesses.


1-4. The number of businesses owned by Asians, Hispanics, and American Indians has grown dramatically.




1-5. Land, sometimes called natural resources, is the most critical factor of production in explaining why some countries are poor while others are rich.


1-6. Money is one of the five factors of production that contribute to the creation of wealth.


1-7. Tools, machinery, and buildings are all types of capital resources.


1-8. Recent studies have shown that the major advantage rich nations have over poor nations is an abundance of land and labor.


1-9. Entrepreneurship is one of the five factors of production that contribute to the creation of wealth.




1-10. The two factors of production that are the most important for creating wealth are entrepreneurship and the effective use of knowledge.


1-11. Information and knowledge are essentially the same.


Explain Taylor’s scientific management.

Level of Learning 1 (Knows basic terms and facts)

10-1. The sense of satisfaction you get when you achieve an important goal is an intrinsic reward.


10-2. Extrinsic rewards are those that are given to a person by someone else.


10-3. Motivation is the drive to satisfy a need.


10-4. Since motivation comes from within an individual, there is little that managers can do to help motivate workers.


10-5. When unhappy workers leave a company, the firm normally ends up benefiting financially.


10-6. Frederick Taylor's goal was to find ways to improve worker motivation by making work more interesting and challenging.


10-7. A key element of Frederick Taylor's approach was the time and motion study, which examined the tasks performed to complete a job and the time needed to complete each task.




10-8. Frederick Taylor based his approach on the belief that each worker was an individual who should be treated as a unique asset to the firm.


10-9. Scientific management became the dominant strategy for improving productivity during the early 1900s.


10-10. Elton Mayo is known as the father of scientific management.


10-11. Frederick Taylor believed that workers would be more productive if they were allowed to decide for themselves which methods at work to use.


10-12. Three elements were basic to Taylor's approach: time, methods, and rules of work.


10-13. Frank and Lillian Gilbreth developed the principle of motion economy, which said that every job could be broken down into a series of elementary motions.


10-14. Frederick Taylor's ideas about improving worker productivity attracted a lot of attention at the time, but had little lasting significance.


4-21.The Enron scandal illustrates the difference between unethical behavior and illegal behavior.


4-22.Ethical behavior requires more than following the law.


4-23.Legal behavior and ethical behavior are basically the same.


4-24.Many immoral and unethical acts fall well within our laws.




4-25.Ethical behavior refers to the standards that are accepted by society as right or wrong.


4-26.Ethical behavior requires individuals to decide for themselves what is right and wrong in each situation they face.


4-27.Given the level of diversity within the United States, agreement on common standards of ethical behavior is unachievable.





4-28.An accurate statement regarding this chapter is "Business law establishes ethical behavior."


Rationale: The most basic step in ethical behavior is the law, but ethics go far beyond legality.

4-29.Legal behavior includes more aspects of our relationships with others than does ethical behavior.


Rationale: Legality is a more limiting term. Many immoral and unethical acts fall well within our laws.

4-30.Legal behavior is a first step toward ethical behavior.



4-31.Laws that protect us from fraud, theft and violence determine ethical behavior.



4-32.Moral behavior refers to behavior that is accepted by society as right versus wrong.


Rationale: Ethics defines the standards of moral behavior, or the attempt to live by certain values and standards of conduct accepted by society as right and wrong.

4-33.Ethical behavior always treats others fairly.


Rationale: Ethical behavior focuses on proper relations with other people. An ethical person will treat others with honesty and sincerity. Perhaps the essence of this behavior is The Golden Rule, “do unto to others as you would have them do unto you.”



4-34.People involved in business may be tempted to do something unethical in order to increase sales and profits. However, if they are caught, our legal system will deal harshly with them.


Rationale: Many immoral and unethical acts fall well within our laws.

4-35.Ethical behavior involves the clear and easy choice of right and wrong actions towards others.


4-36.An ethical manager strives for a win-win relationship with others.


4-37.The question "Is it legal?" establishes ethical behavior.


4-38.Trying to make decisions that will benefit all parties involved is consistent with the question "How will it make me feel about myself?"


10-29. Abraham Maslow believed that motivation arises from the desire to satisfy unmet needs.


10-30. According to Maslow, it is impossible to rank human needs in any logical order.


10-31. According to Maslow, people will try to satisfy lower order needs before they turn their attention to higher order needs.




10-32. Safety needs are at the lowest level in Maslow's hierarchy of needs.


10-33. Maslow referred to the needs people had for recognition and acknowledgement from others as esteem needs.


10-34. According to Maslow, a satisfied need is no longer a motivator.


10-35. In Maslow's hierarchy, self-actualization needs are those needs associated with basic survival, such as the need for food and shelter.


10-36. Social needs are the highest level of needs in Maslow's hierarchy.


10-37. In Maslow's view, social needs include the need to feel loved and accepted.


10-38. Maslow believed that lower level needs may emerge at any time when they are not met and take our attention away from higher-level needs.


10-44. Herzberg's research focused on determining which management style achieved the highest level of worker motivation.


10-45. Herzberg's research examined how conditions related to the job itself affected the motivation of workers.


10-46. Herzberg's study showed that pay was the job characteristic that ranked highest as a motivator.

Answer: False LG: 4/LL: 1 Page: 305-306

10-47. Herzberg found that the factors that ranked high as motivators were usually associated with job content rather than the work environment.




10-48. Herzberg found that the sense of achievement workers experienced when they performed their jobs was an important motivator.

Answer: True LG: 4/LL: 1 Page: 305-306

10-49. Herzberg used the term hygiene factor to refer to an element of job content that was particularly important as a source of worker motivation.


10-50. According to Herzberg, when a hygiene factors is not fulfilled, workers will become dissatisfied.


10-51. Herzberg's research found that improvements in work environment were a more effective way to motivate workers than improvements in job content.




10-52. Herzberg’s motivators tend to be factors that would help workers achieve the esteem and self-actualization needs identified by Maslow.

Answer: True LG: 4/LL: 1 Page: 307 (and Figure 10.3 on page 308)

1-12. Starting a business is a riskier path toward business success than working your way up the ranks of a large business.


1-13. Paid vacations and health care insurance are among the benefits provided by the government to entrepreneurs.


1-14. Women currently own less than ten percent of all businesses.


1-15. The number of businesses owned by Asians, Hispanics, and American Indians has grown dramatically.


1-16. Land, sometimes called natural resources, is the most critical factor of production in explaining why some countries are poor while others are rich.


1-17. Money is one of the five factors of production that contribute to the creation of wealth.


1-18. Tools, machinery, and buildings are all types of capital resources.


1-19. Recent studies have shown that the major advantage rich nations have over poor nations is an abundance of land and labor.


1-20. Entrepreneurship is one of the five factors of production that contribute to the creation of wealth.




1-21. The two factors of production that are the most important for creating wealth are entrepreneurship and the effective use of knowledge.


1-22. Information and knowledge are essentially the same.


6-21. Entrepreneurial teams combine the creative marketing and production ideas of a group of experienced people. .


6-22. Entrepreneurial teams struggle to blend creative business skills with production and marketing skills.


6-23. Successful entrepreneurs often make use of professional managers to introduce new ideas.


6-24. Micropreneurs is a term used to describe entrepreneurs who focus on the continued growth of their businesses.


6-25. The most important difference between entrepreneurs and micropreneurs is the focus placed by micropreneurs on balancing the demands of work and family.


6-26. The primary concern of micropreneurs is to balance the risk of starting your own business with the desire to build a powerful organization earning significant profits.


6-27. Micropreneurs are home-based business owners.


6-28. Micropreneurs are motivated by a desire to have both a satisfying family life and rewarding work.


6-29. Advancements in computer technology put home-based businesses at a



disadvantage.




6-30. Many micropreneurs operate home-based business in the service industry.


6-31. Corporate downsizing reduces the opportunities for home-based businesses.


6-32. Society is much more accepting of home-based entrepreneurs than in the past.


6-33. Opponents of home-based businesses successfully lobbied Congress to reduce the tax deductions available for home offices.


6-34. Successful micropreneurs require self-discipline to separate work from family responsibilities.


6-35. Micropreneurs are exempt from the local ordinances that restrict home-based businesses from operating in residential areas.


6-36. One advantage enjoyed by home-based businesses is the relative ease in attracting new customers.


1-23. Technology can help businesses become more efficient and productive.


1-24. Productivity is measured by dividing total output of goods in a given time period by work hours.


1-25. Technology enables U.S. workers to make more money than workers in low wage rate countries.


1-26. Technology affects people in most, but not all industries.




1-27. E-commerce is the buying and selling of products and services by businesses and consumers over the Internet.


1-28. E-commerce often incurs higher transaction costs compared to traditional business transactions.


1-29. Technology refers to everything that makes business operations more efficient and productive.


1-30. Technology affects people in all industries.


1-31. Technology allows firms to be more responsive to their customers’ wants and needs.


1-32. The fact that goods sold over the Internet are subject to higher sales taxes than goods sold in retail stores is one of the disadvantages that limit the attractiveness of e-commerce.




1-33. Business owners are often reluctant to enter the e-commerce market because of the sizeable investment required in land, fixtures, and buildings.


1-34. Many new Internet companies fail.


1-35. The Internet has increased competition and improved a business’ interaction with its customers.


1-36. The business-to-business segment of e-commerce is smaller than the business-to-consumer segment of e-commerce.


1-37. Bar codes allow retailers to scan information about the products consumers buy directly into a database.


1-38. An electronic file where information is stored is called a CPU.


1-39. The databases of a business often include a great deal of information about the firm’s customers.


1-40. The statistical study of the human population to describe its size, age, gender, and income is known as diversity recognition.


1-41. Population studies indicate that the percentage of Hispanics and Asians in the U.S. is likely to remain unchanged.


1-42. Demographic changes create new business opportunities.


1-43. Some observers feel that boomers and Generation Xers tend to view work differently.




1-44. Boomers are those people born between 1965 and 1980.


1-45. Currently people between the ages of 45 and 54 are the richest group in the United States.


1-46. New welfare rules have made it easier for single parents to remain at home with their young children without being required to seek employment.


1-47. One approach used by businesses to respond to the diverse needs of their workers is to offer “cafeteria-style benefits” packages.


1-48. According to the book Generations at Work, boomers and Generation Xers tend to view work differently.


1-49. One factor that has led to the rapid increase in two-income families is the emphasis on “having it all.”

10-57. Job enrichment is an extension of the ideas developed by Abraham Maslow and Frederick Herzberg.


10-58. Job enrichment is based on Herzberg's higher motivators, such as responsibility, achievement, and recognition.


10-59. The autonomy of a job refers to the impact the job has on the lives or work of people within the organization.


10-60. Skill variety is one of the characteristics of work that lead to improved motivation and performance.


10-61. According to job enrichment theory, one of the characteristics of a job that



contributes to improved motivation and worker performance is higher than average pay.


10-62. Feedback enhances worker motivation by giving workers a feeling of achievement and recognition.


10-63. Task identity refers to the degree to which a job has a substantial impact on the lives or work of others in the company.


10-64. Job simplification attempts to increase task efficiency by breaking the job into simple steps and assigning people to perform each of those steps.


10-65. Job simplification is an effective strategy for managers who want to achieve job enrichment .


10-66. Job enlargement is the strategy of assigning workers to different jobs within the organization on a regular basis.


10.67. Job enlargement attempts to enrich jobs by combining a series of tasks into one challenging and interesting assignment.


10-68. Job rotation attempts to make work more interesting and motivating by moving employees from one job to another.



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