Commerce
Uploaded by
CBSE UGC NET EXAMCommerce
Uploaded by
CBSE UGC NET EXAMMOST POPULAR AROUND THE WORLD
SUCCESS
PRACTICE BOOK» NOT FOR SALE
SERIES
COMMERCE
BOOST YOUR KNOWLEDGE
DESIGNED FOR SURE SUCCESS
MCQ EDITION
NARAYAN CHANGDER
1 + S
2 O N
S
93 STI ER
E W
QU NS
A
USEFUL FOR
4STUDENTS 4
□ □TEACHERS 4
□PARENTS 4□KIDS 4
□QUIZ TEST
□EXAM 4
4 □TRIVIA TEST 4
□COMPETITIVE EXAM 4
□OTHERS
2
Preface:
This book has undergone rigorous scrutiny to ensure its accuracy. I eagerly invite constructive
feedback on its content. Feel free to reach out to me via Facebook at https://www.facebook.
com/narayanchangder. Additionally, you can access all of my books on Google Play Books at
https://play.google.com/store/books/author?id=Narayan+Changder.
JAI SHREE RAM
NARAYAN CHANGDER
This E-book is dedicated to the loving memory of my mother:
PRACTICE BOOK» NOT FOR SALE
my guiding light, my shining star,
forever
It is my deepest gratitude and warmest
affection that I dedicate this Ebook.
To my mother JOYTSNA CHANGDER
who could not see this Ebook.
who has been a constant source of Knowledge and in-
spiration. Mom, Covid did not take you, it took our
many dreams. wherever you are we will meet again.
Disclaimer
The aim of this publication is to sup-
ply information taken from sources be-
lieved to be valid, reliable and authen-
ticate. The author bear no responsibil-
ity for any damage arising from inad-
verent omissions, negligence or inac-
curacies (typographical or factual) that
♣
NARAYAN CHANGDER
may have found their way into this PDF
booklet.
Due care has been taken to ensure that
the information provided in this book
is correct. Author is not responsible
for any errors, omissions or damage
arising out of use of this information.
nt
Importa inter-
s , s e ar ch the de
er to inclu -
i t h t h e answ w a n t
w u au
atisfied . If yo ontact
If not s rrect answers klet, please c t s:
p
net for
co
i n t h is boo F a c e b ook ht
estions on
tact him arayanchangd
er/
new qu a n c o n n
ou c om/
thor. Y acebook.c
. f
//www
CRUCIAL INFORMATION: PLEASE READ BEFORE
CONTINUING:
PRACTICE BOOK» NOT FOR SALE
1. If you require practice sets on various sub-
jects, kindly send us a message on Facebook
with the subject name. Our team will be happy
to create them for you. Message us on Face-
book at https://www.facebook.com/
narayanchangder
2. Additionally, you can access all of my books
with answers on Google Play Books at »>
https://play.google.com/store/books/
author?id=Narayan+Changder
3. Answers are given at the end of every page
to help you identify your strengths and weak-
nesses.
4. It shows you how to build your own techni-
cal and pedagogical skills to enable them to
create their own materials and activities for
students.
5. It helps you to see how you can make the
transition from classroom teaching to blended
and online teaching.
6. It’s the cheapest good quality ebook that you
can buy online on google play books.
NARAYAN CHANGDER
7. The money raised from creating the sales of
the book will help to ensure that I’m able to
produce similar books like this at a compara-
ble price.
8. YOU CAN DOWNLOAD 4000+ FREE PRACTICE
SET PDF EBOOK ON VARIOUS SUBJECTS (NURS-
ERY to UNIVERSITY LEVEL) FROM GOOGLE
DRIVE LINK https://drive.google.com/
drive/u/1/folders/19TbUXltOSN5S7FV3sL
PRACTICE BOOK» NOT FOR SALE
Contents
1 Commerce . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.1 Business Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2 International Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
1.3 Accounting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
1.4 Auditing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 206
1.5 Business Economics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 253
1.6 Business Finance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 336
1.7 Business Statistics and Research Methods . . . . . . . . . . . . . . . . . . . . . . 432
1.8 Business Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 480
1.9 Human Resource Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 631
1.10 Banking and Financial Institutions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 686
1.11 Marketing Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 765
1.12 Legal Aspects of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 871
1.13 Income-tax Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 882
1.14 Personal Financial Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 915
1. Commerce
NARAYAN CHANGDER
1.1 Business Environment
1. Which sector contributes DIRECTLY to the 4. Considering the nationwide lockdown
Gross Domestic Profit (GDP) of South amid COVID-19 pandemic, ICICI has
Africa launched mobile ATM facility to let peo-
ple stay safe at their homes. Which im-
A. Formal
portance of business environment is high-
B. Private lighted here?
C. Public A. Helps in getting first mover advantage
D. Informal B. Helps in identifying early threat sig-
nals
2. A ski resort can’t sell passes because there C. Helps in tapping resources
is no snow. What external factor is this? D. Helps in adapting with the rapid
A. Political changes
B. Economic 5. Internal environment includes..
C. Environment A. structure and monitor
B. resources
D. Social
C. culture, monitor and structure
3. Which of these is an international trade D. culture, resources and structure
agreement/organization?
6. Customers, competitiors, suppliers and
A. United Nations Educational, Scientific special interest groups are all part of the
and Cultural Organization (UNESCO) which environment?
B. United Nations (UN) A. Internal
C. World Trade Organization (WTO) B. Macro
D. Student Nonviolent Coordinating Com- C. External
mittee (SNCC) D. Operating
1. A 2. C 3. C 4. D 5. D 6. D
1.1 Business Environment 3
7. Over-production in developed countries D. corporation
may be released into the markets of de-
E. resources
veloping nations, which undercuts domes-
PRACTICE BOOK» NOT FOR SALE
tic prices and domestic producers may be 12. This is generated by examining the goods
forced to leave the market. This is called and services sold in the community.
A. Business Creation
A. Dumping
B. Business Pricing
B. Quota
C. Tariffs C. Business Concept
D. Embargo D. Business Idea
8. Non-executive directors are the persons 13. In the product development process, mar-
who have no managerial responsibilities keters should treat their suppliers
towards the organisation. Which of the A. strictly as vendors to avoid relation-
following would be identied as a problem ship issues
with the role of non-executive director?
B. with professionalism, but without de-
A. External stakeholder security
veloping too close of a relationship
B. Time available to devote to the role
C. as partners to ensure product success
C. Objective viewpoint
D. like part of the family, with suppliers
D. none of above working alongside the marketing team
9. Which of these are external factors that
14. What is important in the relationship that
influence financial decisions?
a business develops with its suppliers?
A. Price
A. Reliability
B. Personal
B. Cost Effectiveness
C. Cultural
C. Positivity
D. Marketing
D. All of the above
E. Finance
10. An example of an internal environmental 15. Macro environment is controlled by
factor is A. Business
A. Legal issues eg consumer law B. None
B. Suppliers C. Government
C. Employees
D. International relations
D. Competitors
16. Which of these is telecommuting done in
11. The means available to develop solutions
for unsatisfied wants and needs. A. Home Office
A. money markets B. Mobile Office
B. demand C. Traditional Office
C. market economy D. Virtual Office
7. A 8. B 9. A 9. D 9. E 10. C 11. E 12. D 13. C 14. D 15. B 16. A 17. C
1.1 Business Environment 4
17. Which of the following is not the element B. Richard Dawkin
of political environment:
C. Abraham Maslow
A. Constitution of the country
D. Henry Fayol
B. prevailing political system
C. popularity of e-banking 23. The sale of gift items increases during the
D. Level of political morality time of Diwali and Christmas. Popular
firms dealing in gift items in major towns
NARAYAN CHANGDER
18. Investments made by MNCs are termed and cities make special plans of sale during
as: this period.Which dimension of business
environment comes into picture here?
A. Indigenous investment
B. Foreign investment A. Social
C. Entrepreneur’s investment B. Political
D. None of the above C. Economic
19. The external macro environment is made D. Legal
up of which elements
24. As a result of the Economic Reforms the
A. Socio-cultural
Seller Market has been replaced by
B. Scientific
A. Buyer Market
C. Technological
B. Foreign Market
D. Economic
E. Political C. Wholesale Market
D. Retail Market
20. The management function of providing
guidance to workers and work projects:
25. Victa lawn mower, Esky, Stump camera,
A. Directing and speedo swimwear are all
B. Controlling A. things we use during summer
C. Staffing
B. things we have at home
D. Organizing
C. things invented overseas
21. There has been tremendous growth in BPO D. things invented in Australia
and KPO services. Identify the economic
reform responsible for this trend?
26. It refers to the national or local laws, in-
A. Liberalization ternational laws, and rules and regula-
B. Privatization tions that influence organizational man-
agement.
C. Globalization
A. Political Situations
D. None
B. Economic Situations
22. The theory of survival of fittest is formu-
lated by C. Sociocultural Situations
A. Charles Darwin D. Technological Situations
18. B 19. A 19. C 19. D 19. E 20. A 21. C 22. A 23. A 24. A 25. D 26. A 27. B
1.1 Business Environment 5
27. Identify the following in order:i. On ac- 32. A country that wishes to enhance interna-
count of increase in export duty made by tional trade activities would be most likely
the government, the foreign demand has use:
PRACTICE BOOK» NOT FOR SALE
gone down.ii. The government permitted
A. a tariff
cent percent foreign Direct Investment in
some sectors of retailing. B. a common market
A. Political, Economic C. an embargo
B. Economic, Political D. a quota
C. Economic, Economic
33. These are parties likely to be affected by
D. Political, Political the activities of the organization.
28. Riskiest way of entering a new market, A. Stakeholders
because it involves buying an existing busi- B. Suppliers
ness or setting a new one
C. Employees
A. Foreign Direct Investment
D. Costumers
B. Joint Venture
C. Licensing 34. It is common now to see CD-ROM’s, com-
D. Export puterized information kiosks, andInter-
net/Word Wide Web multimedia pages
E. Internet highlighting the virtues of products.’
29. A dentist buys a yacht and pays with a Name thedimension of the business envi-
check from his business. He has violated ronment highlighted by this stateme
what? A. Political Environment
A. The cost principle B. Economics Environment
B. The economic entity concept C. Technological Environment
C. The monetary unit assumption D. All of the above
D. The going concern assumption
35. Short range planning (one year) of specific
30. Business works in isolation actions the business will take:
A. Yes A. Strategic Planning
B. No B. Resource Planning
C. Can’t say
C. Goal Planning
D. None of these
D. Tactical Planning
31. refers to the unrestricted flow of goods,
services, and productive resources be- 36. Creating a website and selling online is re-
tween countries lated to
A. free trade A. Social environment
B. balance of trade B. Political environment
C. trade surplus C. Economic environment
D. trade deficit D. Technological environment
28. A 29. B 30. B 31. A 32. B 33. A 34. C 35. D 36. D
1.1 Business Environment 6
37. Attractive rate of interest on home loans 42. Regulation of business is done by
have increased the demand for homes and
A. Company itself
has given a boost to the business to the
business builders and property dealers. B. Government
Which dimension of business environment C. Outsiders
is highlighted by the statement?
D. Directors
A. Political environment
B. Social environment 43. It includes the inflations, rates of interest,
NARAYAN CHANGDER
changing options in stock markets and peo-
C. Economic environment
ple’s spending habits.
D. Legal environment
A. Political Situations
38. They are those who patronized the organi- B. Economic Situations
zation’s product and services.
C. Sociocultural Situations
A. Costumers
D. Technological Situations
B. Employees
C. Stakeholders 44. “Due to spread of education during last 25
years people have become aware of health
D. Investors or Owners
care. As a result, the demand for health
39. Change in taxes is part of products and services is multiplying day by
day.” Which characteristic of business en-
A. Economic environment
vironment is reflected above?
B. Political environment
A. Certainty
C. Legal environment
B. Uncertainty
D. Social environment
C. Dynamic nature
40. is considered a major element of the
D. Inter-relatedness
political environment
A. The extent and nature of government 45. Environmental factors and changes in the
invention in business economy, society or market conditions are
B. Planned outlay in public and private challenges in this stage of the life cycle.
sectors A. Start-up
C. Expectations from the work force B. Growth
D. Administrative orders issued by gov- C. Maturity
ernment authorities
D. Post-maturity
41. the importance of business environment
which helps to know in advance forthcom- 46. What is the European Commission organ-
ing threats of business ised into?
A. helps in getting first mover advantage A. Directorates-General
B. early warning signals B. Commissioners
C. tapping useful resources C. Individual commissions
D. none D. Councils of ministers
37. C 38. A 39. A 40. A 41. B 42. B 43. B 44. D 45. C 46. A 47. A
1.1 Business Environment 7
47. What financial statement tells us if the 52. Identify the dimension of business envi-
company is profitable? ronment in the following case-a) Replac-
ing old machinery with new one to meet
PRACTICE BOOK» NOT FOR SALE
A. Income Statement
the requirements of pollution control regu-
B. Balance Sheet lations.
C. Statement of Owner’s Equity A. Legal Environment.
D. Statement of Cash Flows B. Technological Environment.
48. With the introduction of Photostat Ma- C. Economic Environment.
chines in the market, the carbon paper D. Social Environment.
industry was adversely affected. Which
component of environment was responsi- 53. Which state is number in human develop-
ble for it? ment in India
A. Economic A. Kerala
B. Political B. Maharashtra
C. Technical C. Andhra Pradesh
D. Telangana
D. All the above
54. Which of the following phenomenon
49. Special programs being run by the govern-
doesn’t form the part of NEP, 1991?
ment for the
A. Demonetisation
A. Vulnerable sections of the society
B. Liberalisation
B. Those who are interested
C. Privatisation
C. All people
D. Globalisation
D. None of these
55. The announcement of 21 days nationwide
50. What does the first E in PESTEC stand for? lockdown and its extension subsequently
A. Economic by the Hon’ble Prime Minister of India in
times of COVID-19 pandemic comes un-
B. Environment der which component of business environ-
C. Education ment?
D. Exchange A. Social
B. Economical
51. Consumer markets consist of
C. Political
A. individuals that buy goods and ser-
vices to resell D. Legal
B. companies that produce products to 56. Which of the following statements regard-
sell to consumers ing types of business is correct?
C. households that buy goods for per- A. Partnership are owned and run by one
sonal consumption or more people.
D. government agencies that buy goods B. Shareholders in companies typically
to produce public services have unlimited liability.
48. C 49. A 50. A 51. C 52. A 53. A 54. A 55. D 56. A
1.1 Business Environment 8
C. The owners of sole traders typically 62. The forces in business environment that ef-
have limited liability. fect all the business houses are known as
D. Private limited companies can sell A. General
shares to the public.
B. Specific
57. Investing the business profits at a rate C. Particular
that grows faster than inflation is also
D. Influencial
known as:
NARAYAN CHANGDER
A. Hedging 63. Just after the declaration of the results of
the Lok Sabha Elections, 2009, the Bom-
B. Strategic Alliance Agreements
bay Stock Exchange’s price index (Sensex)
C. Persuasion of large investors rose by 2100 points in a day. Identify
D. Acquisitions the environmental factor which led to this
rise?
58. is included in Economic Environment. A. Legal Environment
A. Economic System B. Political environment
B. Economic Policies C. Social Environment
C. Economic Conditions D. Economic Environment
D. All of the above.
64. Now the paint companies use computers
59. Which of the following is not a character- to mix the colours to come out with con-
istic of buniess environment? sumers desired shades for whitewash pur-
pose. Which dimension?
A. Dynamic
A. Social dimension
B. Integral
B. Technological dimension
C. Complexity
C. Economic dimension
D. Absolute
D. Legal dimension
60. ‘Remuneration of employees should be
just and fair’ is related to which Business 65. Invention refers to the development of
environment? A. an existing idea/product/process
A. Economic B. an existing product/process/idea
B. Social C. a totally new idea/product/process
C. Legal D. the alteration of out of date
D. Political ideas/products/processes
61. Which of these is a benefit to a nonprofit 66. Managers need what type of skills?
A. No taxation A. Technical Skills
B. Double income B. Interpersonal Skills
C. Double profit C. Conceptual Skills
D. Pays employees a lot D. All the Above
57. A 58. D 59. D 60. B 61. A 62. A 63. B 64. B 65. C 66. D 67. E
1.1 Business Environment 9
67. The possibility that an expected profit will 72. The management of the business has
not be achieved. the market environment
PRACTICE BOOK» NOT FOR SALE
A. resources A. Full control over
B. demand B. No control over
C. market economy C. No control but can influence
D. corporation D. Little control
E. financial risk 73. What field of accounting provides informa-
tion for external decision makers?
68. Trade Unions fall under the Environ-
ment A. Financial accounting
B. Managerial accounting
A. Micro
C. Nonmonetary accounting
B. Market
D. Cost accounting
C. Macro
D. none of above 74. Which of thes options best describes op-
portunity cost?
69. It refers to the factors or elements affect- A. The price of taking a chance
ing business organization.
B. The alternative you have to go without
A. External Business Environment in a choice of two things
B. Business Environment C. The cost of opportunity
C. Internal Business Environment D. The price you pay when you make a
D. Environment choice
75. The environment scanning helps to identify
70. The term for a place where buyers and sell-
ers interact to trade goods and services is A. Opportunity
called a B. Threats
A. shop C. Both a and b
B. market D. None of the above
C. store
76. Porter’s Five Forces model identifies fac-
D. a place of exchange tors which determine the nature and
strength of competition in an industry.
71. Who are professional accountants that Which of the following is not one of the
serve the general public, not just one sin- five forces identified in Porter’s model?
gle company?
A. Substitute products or services
A. Controllers
B. New entrants to the industry
B. Certified Public Accountants
C. Bargaining power of customers
C. Certified Management Accountants
D. Government regulations of the indus-
D. Audit accountants try
68. B 69. B 70. B 71. B 72. C 73. A 74. B 75. C 76. D 77. B
1.1 Business Environment 10
77. This stage of the business sees movement C. explain clearly and briefly about the
into either an established state or an ex- business and don’t follow up after the
pansion state event
A. Start-up D. use informal words and focus on the
quantity
B. Growth
C. Maturity 82. Which of the following EU legal documents
are binding exclusively on those states,
D. Post-maturity companies or individuals to whom they are
NARAYAN CHANGDER
addressed?
78. Complete awareness and understanding of
business environment is also known as: A. Decisions
A. Environment checking B. Regulations
B. Environment capturing C. Recommendations
C. Environment scanning D. Directives
D. Environment planning 83. when people who are blacklisted/unable
to get credit at the bank, loan small
79. They are comprised to do those who work amounts of money at large interest rates
for another or for an employer in exchange from someone willing to take a higher risk
of salaries/ wages or other considera- A. Microlending
tions.
B. Micro loan
A. Employees
C. Demographics
B. Stakeholders
D. Gambling
C. Pressure Groups
84. This factor influences how a business op-
D. Suppliers
erates, what it provides, and the price the
80. Which of the following are benefits of com- business charges
pleting a business plan. A. Technological factors
A. Helps to plan for crises and emergen- B. Socio-cultural factors
cies. C. Economic factors
B. Helps to learn more about the industry, D. Political factors
market, competitors and customers.
85. is an example of social environment
C. Helps to reduce financial support.
A. Inflation
D. Helps to increase risk
B. Legislation
81. what are the strategies for effective net- C. Innovation
working?
D. Composition of Family
A. focus on quantity, not quality and fol-
low up after the event 86. Successful managers must recognize op-
portunities and threats in their firm’s
B. make a positive impression and
choose the right networking group or A. internal environment
event B. external environment
78. C 79. A 80. A 80. B 81. B 82. A 83. A 84. B 85. D 86. B 87. B
1.1 Business Environment 11
C. local environment A. a global business
D. international environment B. a foreign national company
PRACTICE BOOK» NOT FOR SALE
C. an international corporation
87. influence the quality level of the prod-
ucts D. a virtual business.
A. Dealers 92. A stakeholder is
B. Suppliers A. someone who has a stake in the busi-
C. Marketing Intermediaries ness
D. Public B. someone who has an interest in the
business and has different demands on
88. ITC Hotels made a study of the business the business
environment and planned to open in C. someone who holds a steak
India and abroad.
D. someone who owns the business
A. Factories
B. Hotels 93. nature of business environment sug-
gests that environment keeps on changing.
C. Shops
A. Dynamic
D. Offices
B. Pervasive
89. An import quota is a C. Continuous
A. tax on import quantities above the le- D. Multidimensional
gal limit.
94. The economic resources of a business like
B. way to increase tariff revenues for the furniture, buildings, and land are:
exporting country.
A. Revenues
C. legal limit on the amount of a good that
can be imported into a country. B. Assets
D. legal incentive for members of WTO to C. Dividends
increase their exports of a good or ser- D. Liabilities
vice.
95. Political stability impacts the business
90. Which Incoterms rule says that the seller A. Directly
delivers when he places the goods at
B. Indirectly
the disposal of the buyer at the seller’s
premises or at another named place (i.e., C. No influence
works, factory, warehouse, etc.). D. None of these
A. DAT
96. We have $70, 000 of liabilities and $40,
B. CIP 000 of equity. How much are our total
C. CPT assets?
D. EXW A. $180, 000
B. $110, 000
91. A company that transcends national bound-
aries and is not committed to a single home C. $80, 000
country is D. $30, 000
88. B 89. C 90. D 91. A 92. B 93. A 94. B 95. A 96. B 97. A
1.1 Business Environment 12
97. If we have net income, our income state- 102. Banking sector reforms have led to eas-
ment shows what? (Hint:There are two ier credit terms and better services. This
correct statements; select both.) is an example of a key component of the
A. Revenue > Expenses Business Environment. Name this compo-
nent.
B. Expenses > Revenue
A. Economic Environment
C. Revenue > Liabilities
B. Social Environment
D. (Revenue-Expenses) > 0
NARAYAN CHANGDER
C. Technological Environment
98. It is a form of business organizations D. Political Environment
wherein two or more people share own-
ership of a single business. 103. Which of the following is NOT a type of
interest group?
A. Partnership
A. Professional Association
B. Corporation
B. Government
C. C Corporation
C. Trade Union
D. Sole Proprietorship
D. Public Interest Group
99. Which of the following are considered to
104. Identify which of the following refer to
be natural resources?
the internal environment?
A. Employees
A. Political
B. Oil
B. strategic partner
C. Wheat
C. legal
D. Screw driver
D. organization
100. What resources are the equipment and 105. “Acquired assets should be recorded at
supplies that a business needs to produce the amount actually paid, not estimated
and/or sell their products? market value” is
A. Human Resources A. The cost principle
B. Financial Resources B. The economic entity concept
C. Material Resources C. The monetary unit assumption
D. Information Resources D. The going concern assumption
101. The current government initiated Make 106. Just after declaration of Lok Sabha Elec-
in India Programme which is good for the tions 2014 results, the Bombay stock-
manufacturing sector. Out of the follow- exchange’s price index (Sensex) rose by
ing identify the component of Business en- 1000 points in a day. Identify the envi-
vironment quoted in above lines. ronment.
A. Technological environment A. Political and economic Environment
B. Legal environment B. Economic Environment
C. Political environment C. Political Environment
D. Economic environment D. Social Environment
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 13
107. Michael has been asked to prepare a pre- 112. The opportunity cost of Australian house-
sentation for the company directors on holds moving away from coal-powered en-
good corporate governance. Which one of ergy to solar-powered energy includes:(i)
PRACTICE BOOK» NOT FOR SALE
the following is he likely to exclude from the loss of jobs in the coal industry, (ii) a
his presentation? cleaner environment, (iii) reduced coal pro-
duction.
A. Risk management
B. Internal controls A. (i), (ii) and (iii)
C. Maximising shareholder wealth B. (ii) and (iii)
D. Accountability to stakeholders C. (iii) only
D. (i) and (iii)
108. Who is responsible for the operation of
an entire organization? 113. Business Functions include:
A. First Line or Supervisory Managers A. Marketing
B. Mid Level or Middle Managers B. HR
C. Top Level or Executive Managers C. Supply
D. All the Above D. Purchasing
109. Specialize in buying and selling financial E. Public Relations
instruments for short time periods of a
year or less. 114. Tool to evaluate MACRO Environment
A. money markets A. SWOT
B. demand B. PESTLE
C. market economy C. Porter’s 5 Forces
D. corporation D. none of above
E. financial risk
115. what is business enviroment?
110. is not an ingredient of political envi- A. some effort of an enterprise to gain
ronment. profit
A. Political System B. tools to gain money
B. Political institutions C. place of the business
C. Political Pholosophies D. method to fight competitors
D. Monetary Policy
116. What is the phrase used for internal fac-
111. is the tool to achieve privatization. tors?
A. Abolishing licenses A. FIMTS
B. Disinvestment B. STMIF
C. Free movement of goods and services C. MITFS
D. Globalisation D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 14
117. Under which environmental effects IBM 122. Greenwich is an independent environ-
and Coca-cola had to leave India? * ment charity set up to lobby the govern-
A. Political ment for improved environmental regula-
tion on business. What type of organiza-
B. Technical tion is Greenwich most likely to be classed
C. Social as?
D. Economic A. Public sector
B. Co-operative
NARAYAN CHANGDER
118. Marketing intermediaries help in
C. Non-governmental
A. supplying raw to the company
D. Commercial
B. transporting the goods
C. serving as a link 123. Decision making is centralised and key
personnel from headquarters are sent to
D. Selling the product oversee operations in other countries. This
119. Social factors include income level, in- is a feature of
come tax rate, market situations etc.- A. Polycentric
State whether the statement is true or B. Geocentric
false?
C. Ethnocentric
A. True
D. none of above
B. False
124. Psychographics are:
C. Can’t say
A. The physical attributes of the target
D. none of above
market
120. In approach, the firm accepts a re- B. The wants and needs of the consumers
gional marketing policy covering a group
C. The beliefs and values of the con-
of countries which have comparable mar-
sumers
ket characteristics such as economic, cul-
tural or political similarities and formu- D. The education level of the consumers
lates operational strategies based on re- 125. It is the degree to which a society values
gion instead of countries. assertiveness and feelings of material suc-
A. Polycentric cess versus concern for relationships.
B. Ethnocentric A. Uncertainty Avoidance
C. Regiocentric B. Masculinity-Femininity
D. Geocentric C. Time Orientation
D. Power Distance
121. . Globalisation signifies:
A. integration among various economies 126. Legal environment includes:
of the world A. government policies related to pricing
B. integration among various economies B. the constitutional framework
of the world C. goverment policies related to import
C. removal of economic licensing and export
D. none of the above D. all of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 15
127. The Humane Society is an example of B. Desires
what C. Requirements
PRACTICE BOOK» NOT FOR SALE
A. Sole Proprietorship
D. Needs
B. Nonprofit
133. John’s Plumbing earns $500 by complet-
C. LLC
ing a job. The $500 earned by John’s
D. Corporation Plumbing is its:
128. What determines the price and quantity A. Gain
produced of most goods? B. Debt
A. Where supply and demand meet C. Equity
B. How many substitutes are available
D. Revenue
C. The quality of goods that are produced.
134. Main levels of management include:
D. If a consumer thinks it is a want or a
need. A. Top Level or Executive
129. Which of the following organisations lays B. Mid Level or Middle
stress on liberalisation of foreign trade C. First Line or Supervisory
and foreign investment? D. All the Above
A. International Labour Organisation
135. The surrounding conditions in which the
B. International Monetary Fund
business operates are called
C. World Health Organisation
A. Environments
D. World Trade Organisation
B. Business contacts
130. Which of the following statements about C. Business Environments
corporate social responsibility is true?
D. Business Conditions
A. CSR guarantees increased profit levels
B. CSR adds cost to organisational activi- 136. High GDP with low population will result
ties and reduces profit levels into
C. Social responsibility may have com- A. Higher expenditure
mercial benefits B. High per capita income
D. none of above C. High taxes
131. An example of an interest group is D. High levels of service
A. Trade Union
137. Steady state, decline or renewal are all
B. Competitors possibilities in this stage of the business
C. Employees life cycle
D. none of above A. Maturity
B. Post-maturity
132. These are the things that people cannot
live without in a society. C. Growth
A. Wants D. Start-up
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 16
138. The Basic Conditions of Employment Act 143. How a country manages its resources is
is an example of an example of its condition, which in-
fluences international business.
A. Contemporary legislation
A. cultural and social
B. Globalisation
B. geographic
C. Employee protection
C. economic
D. Employer insurance
D. political and legal
NARAYAN CHANGDER
139. Which of the following is a disadvantage
of operating an online business: 144. The entry of the multinational companies
in large numbers in the Indian market has
A. Access to global markets. created
B. Convenience for customers. A. Huge Demand
C. Lack of face to face contact. B. Huge Supply
D. Sales can increase C. Tough Competition
D. Huge Demand and Supply
140. Which of the following is NOT an argu-
ment in favor of protectionism? 145. How many factors make up the Macro En-
A. Protectionism shields infant industries vironment
from foreign competition A. 3
B. Protectionism safeguards workers’ B. 4
jobs
C. 5
C. Protectionism promotes industries
D. 6
that are essential to national security
D. Protectionism makes domestic firms 146. forces affect individual enterprises di-
more competitive in the long run rectly and immediately in their day to day
working affects all the firms indirectly
141. Features of international business that a A. specific, general
organization may be exposed to
B. general, specific
A. Exchange rates
C. technological, legal
B. Political risks
D. customers, investors
C. Foreign economic condition
147. Consumer, health and safety and employ-
D. All of the above ment laws are all considered
142. Globalization does not involve * A. Political factors
A. Reduction of barrier B. Legal factors
B. Free flow of capital C. Ethical Factors
C. Global mechanism for settlement of D. none of above
economic disputes
148. It involves the use of varied types of elec-
D. Free flow of goods & services tronic gadgets and advanced technology
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 17
such as computers, robotics, microproces- B. Domestic consumer from higher
sors and others that have revolutionized priced goods produced within the coun-
business management; e-commerce, tele- try.
PRACTICE BOOK» NOT FOR SALE
conferencing, and sophisticated and infor- C. Domestic manufacturer from higher
mation systems. priced foreign goods
A. Political Situations D. Domestic manufacturer or farmer
B. Economic Situations from lower priced goods imported into
the country.
C. Sociocultural Situations
D. Technological Situations 153. Identify the dimension:National Digital Li-
brary of India is a pilot project initiated by
149. Identify the feature of business environ- the HRD ministry. It works towards devel-
ment from following statement.Business oping a framework of virtual repository of
environment have some forces which ef- learning resources with a researchers, life
fect business firms directly but some fac- long learners and differently abled free of
tors affect them indirectly. cost.
A. Complexity A. Social
B. Inter-relatedness B. Economic
C. Technological
C. Relativity
D. Technological and Social
D. Specific and general forces
154. Privatization means
150. Why is good customer service important
A. planned disinvestment.
A. It drives people away from the busi-
ness B. planned investment.
C. reduced multinational companies’ con-
B. It drives people to the business
trol
C. It makes people feel bad
D. planned saving.
D. It makes people feel undervalued
155. involves setting up the way the busi-
151. refers to the factors/elements within the ness’s work will be done.
organization which may affect, either pos- A. Planning
itively or negatively, the performance of
B. Staffing
the organization.
C. Directing
A. Internal Business Environment
D. Organizing
B. Porter’s Analysis
C. PESTEL Analysis 156. What does SWOT mean?
D. External Business Environment A. Strengths and Weaknesses, Opportu-
nities and Treats
152. A protective tariff is intended to “pro- B. Straight and Weaknesses, Opportuni-
tect” the ties and Threats
A. Domestic consumer from higher prices C. Strengths and Wages, Opportunities
on foreign goods. and Threats
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 18
D. Strengths and Weaknesses, Opportu- A. Customers
nities and Threats B. Suppliers
157. information, tools or device that moti- C. Employees
vate students and give information or as- D. Shareholders
sistance with question. Based on the
statement, which resources is it? 162. What does the last E in PESTEC stand
A. Financial resources for?
NARAYAN CHANGDER
B. Physical resources A. Economic
C. technological resources B. Employees
D. organizational resources C. Environment
D. Ethos
158. Government systems, political stability,
trade barriers, and business regulations 163. Which of the following you will not in-
refer to which factor of the international clude in economic environment
business environment?
A. economic policies of government
A. geographic
B. market for labour
B. economic
C. per capita income
C. political and legal
D. customs of people
D. cultural and social
164. Someone who creates their own business
159. Which of the following is not a feature of is called a(n)
Business environment? *
A. Entrepreneur
A. Interrelated Elements
B. Billionaire
B. Complex
C. Investor
C. Continuous
D. Stock Holder
D. Dynamic
165. Shareholders of a private limited com-
160. How are the members of the European pany have
Parliament chosen?
A. unlimited liability
A. The European Commission nominates
them B. limited liability
B. EU citizens elect them in general elec- C. 100% liability
tions D. consistent liability
C. The European Council nominates them
166. The main factors that affect the economic
D. The national parliaments in each EU environment are..
country send their representatives who
become the members of the European Par- A. capitalist economy
liament B. economic condition
161. Which is following would NOT be de- C. mixed economy
scribed as a connected stakeholder? D. socio-cultural economic
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 19
167. It is the easiest and least expensive form 172. According to the Indian Constitution
of business organizations.
A. All are equal before law
PRACTICE BOOK» NOT FOR SALE
A. Corporation
B. Equals are equal
B. Incorporation
C. first among equals
C. Sole Proprietorship
D. None of these
D. Partnership
168. What are the importance of assessing the 173. This stage of the business is the very be-
business environment? ginning of the business life cycle where it
is just a thought or an idea.
A. Foreseeing threats and warning sig-
nals A. Start-Up
B. Monitoring B. Seed
C. Bargaining power of buyers C. Maturity
D. Expands influence and valuable con-
D. Growth
tacts
169. When two businesses willingly combine 174. It is the degree to which a society ac-
to create a new business, this is known cepts or rejects the unequal distribution of
as: power among people in organizations and
the institutions of society.
A. A merger
A. Individualism-Collectivism
B. A takeover
C. An alliance B. Masculinity-Femininity
D. An acquisition C. Power Distance
170. ‘Demand for Bhujia is high in India, D. Uncertainty Avoidance
whereas it is almost nil in Greenland.’
175. Shared beliefs, values, expectations, at-
Which feature of business environment is
titudes and behaviours are all examples of
stated here?
which Internal Environmental factor?
A. Dynamic
A. Owner/s/Management
B. Complexity
B. Employees
C. Specific and general forces
D. Relativity C. Organisational Structure
D. Organisational Culture
171. techniques to build a business network
are
176. War and unlawful activity are two exam-
A. always be prepared and create a two- ples of conditions that influence inter-
way communication national business.
B. deal with rejection and ignore them A. economic
C. ask for opportunities and don’t extend B. cultural and social
out of the comfort zone
C. political and legal
D. always say thank you and talk in a
harsh way D. geographic
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 20
177. Tool to evaluate MARKET Environment B. Social environment
A. SWOT C. Technological environment
B. PESTLE D. Economic environment
C. Porter’s 5 Forces 183. The process of rapid integration or inter-
D. none of above connection between countries through free
trade, free mobility of capital and labour is
178. Globalization is encouraged by called
NARAYAN CHANGDER
A. Internet A. Foreign trade
B. Mobile phones B. Liberalisation
C. Computer C. Globalisation
D. None of these D. Privatisation
179. Internal business environment 184. important accesing business environment
A. customers A. meet a lot of people
B. competitors B. know the place
C. organizational structure C. a lot of information
D. friends D. foreseeing threats and warning sig-
nals
180. When parastatals are sold to individuals
because they are not profitable as state 185. Businesses have the most control over
owned businesses the environment
A. Nationalisation A. Micro
B. Market
B. Privatisation
C. Macro
C. Spending power
D. none of above
D. Eskom
186. The form of financial ownership in which
181. is a technique used to determine and de- profits can be taxed twice is
fine your STRENGTHS, WEAKNESSES, OP-
PORTUNITIES and THREATS. A. sole proprietorship
A. Macro-environment B. partnership
B. Porter’s Analysis C. corporation
D. none of the above
C. Micro-Environment
D. SWOT Analysis 187. Establishing a strong customer base,
gaining loyalty, and building relationships
182. In the year 2016, the State Govern- are all examples of which External Oper-
ment of Kerala had made it mandatory for ating factor?
anganwadis hostels and canteens in ed-
A. Customers
ucational institutions to secure the Food
Safety and Standards Authority of India B. Competitors
(FSSAI) licence to ensure food safety. C. Suppliers
A. Legal environment D. Interest Groups
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 21
188. Which of the following refer to market- C. adapting to law and other legal rules
ing? governing the business
PRACTICE BOOK» NOT FOR SALE
A. The adoption of a way of doing busi- D. to tell others about your business and
ness that puts the market at the heart of hopefully turn them into customers
decision
193. The employee can get such knowledge
B. Developing a good, service or idea that form the following sources
is promoted and distributed to customers
in the right place at the right time A. Job description
C. exchanging offerings that have value B. You tube
D. all the answers are correct C. Organization’s policy relevant to a
work role
189. Normally growth of a country is mea- D. Google
sured in terms
A. Tax growth 194. Which of the following is the extended
element of the marketing mix
B. GDP growth
A. people
C. Revenue growth
B. physical evidence
D. None of these
C. process
190. The amount of a product or service that
D. all the answers are correct
individuals want to buy to satisfy their
wants and needs. 195. What are consequences?
A. money markets A. something that is possible but is not
B. demand yet real
C. market economy B. money charged to do something for a
service
D. corporation
C. task that demands time and effort to
E. resources
complete
191. People in urban areas are extensively us- D. the results (positive or negative) of an
ing organic food, bottled water and food action or decision
supplements. Identify the environmental
dimension. 196. Globalization is the term used to describe
process of removal of restriction on
A. Political environment
B. Technological environment A. Foreign Trade
C. Social environment B. Investment
D. Legal environment C. Both (a) and (b)
D. None of the above
192. what are the purpose of business net-
working? 197. is the integration of world economy
A. to influence the business in terms of into a single market through removal of
investment in technology trade barriers between countries.
B. to understand the market growth or A. Privatisation
decline B. Liberalisation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 22
C. Globalisation C. Change in agricultural prices
D. Both (a) and (b) D. Market orientation
198. Demonetisation has lead to: 203. What are the four factors contributing to
A. Depletion of public wealth the Internal Business Environment?
B. Reduced digitalisation A. Customers, Competitors, Suppliers, In-
terest Groups
C. Rise in tax evasion
B. Customers, Clients, Suppliers, Distrib-
NARAYAN CHANGDER
D. Decreased real estate prices utors
199. Which of the following is not an advan- C. Employees, Employers, Customers,
tage of the single market? Clients
A. Increased trade and investment be- D. Owners/Management, Employees,
tween the EU countries Organisational Culture, Organisational
Structure
B. cost reductions
C. when you import goods form outside 204. Which of the functions does not fall into
the EU, tariffs must be paid the four main areas of activity of the Euro-
pean Parliament?
D. huge economies of scale
A. legislation
200. Normally industries prefer locations near
B. supervision of the European Commis-
to
sion
A. Source of raw material
C. the budget
B. Sea
D. choosing the president of the UE
C. Cities
205. what are the stage in managing a busi-
D. Mountains
ness network?
201. It is an easy way to enter markets with A. planning the network and nurturing
high trade restrictions as a company gives the network
the right to use the property to another
B. planning, maintain and nurturing the
company in a new market in exchange for
network
a fee
C. control, build and nurturing the net-
A. Foreign Direct Investment
work
B. Licensing D. planning, building and nurturing the
C. Joint Venture network
D. Internet 206. The project of Nano car re-established in
E. Export Gujarat is indicated by which factor of en-
vironment?
202. Which of the following does not explain
the impact of Government policy changes A. Economic factor
on business and industry? B. Political factor
A. More demanding customers C. Social factor
B. Increasing competition D. Legal factor
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 23
207. Change in sensex and nifty during elec- 212. Factors over which the business has little
tion is part of control over is called the
PRACTICE BOOK» NOT FOR SALE
A. Political environment A. internal environment
B. Social environment B. operating environment
C. Legal environment C. macro environment
D. Economic environment D. external environment
208. Identify the business environment:’The 213. What is return on assets if:$12, 000 net
export of rice has been affected on account income earned during August$40, 000 to-
of bitterness created in the relations with tal assets on August 1$60, 000 total as-
one of the rice exporting countries. sets on August 31
A. Economic A. 4.17%
B. Political B. 20%
C. Social C. 24%
D. 60%
D. Legal
214. Identify which of the following is correct.
209. Nature of relationships of a country with
foreign countries influences the business. A. Hardworking staff in the business is a
strength.
A. Political environment
B. Up to date technologies are a weak-
B. Social environment ness.
C. Economic environment C. A positive work environment is an op-
D. Legal environment portunity.
D. Improving economic conditions is a
210. It is a form of business organizations usu-
threat.
ally owned by one person, usually, the in-
dividual who has day-to-day responsibil- 215. Which of the following are advantages of
ity for running the business. purchasing an existing business?
A. Partnership A. The owner is able to generate income
B. Corporation straight away if the business systems are
working properly.
C. Incorporation
B. Staff are experienced and trained in
D. Sole Proprietorship what they are doing.
211. It is the degree to which a society em- C. The business may already have a good
phasizes individual accomplishments ver- reputation with strong customer loyalty.
sus collective accomplishments. D. All of the above
A. Individualism-Collectivism
216. Which of the following is the pricing tech-
B. Masculinity-Femininity nique?
C. Time Orientation A. market-based
D. Power Distance B. cost-based
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 24
C. competitor based C. production, product, selling, customer,
D. all the answers are correct society
D. all the answers are correct
217. The four factors contributing to the Exter-
nal (Operating) Business Environment in- 222. Identify the feature of business environ-
clude: ment.Demand for sarees may be high in In-
dia but almost negligible in Europe.
A. Owners/Management, Employees,
Organisational Culture, Organisational A. Relativity
NARAYAN CHANGDER
Structure B. Inter-relatedness
B. Customers, Clients, Suppliers, Distrib- C. Complex
utors
D. none of above
C. Employees, Employers, Customers,
Clients 223. This is the introduction of new ideas to
make the product and services more attrac-
D. Customers, Competitors, Suppliers, In-
tive and saleable to the target customers.
terest Groups
A. New Idea
218. Which of the following can be compo- B. Creativity
nents of a business plan?
C. Product Development
A. Operations plan.
D. Innovation
B. Financial plan.
C. Executive summary. 224. “Nowadays consumers are health-
conscious which is giving rise to increase
D. Systems plan. demand of Organic products. “Which fac-
tor of business environment is highlight in
219. is a dimension of business environ-
above statement?
ment.
A. Legal Environment
A. Fashion
B. Social Environment
B. Economic Environment
C. Technological Environment
C. Legislation
D. Economical Environment
D. Monetary Policy
225. If you are willing to take a risk of start-
220. Business environment includes ing and operating a business you show
A. sorroundings of business A. risk taking characteristics
B. customers B. entrepreneusim
C. forces factors and institutions which C. enterpreneurship
directly or indirectly affect the business
D. enthusiasm
D. none of above
226. The application of knowledge that has
221. Which of the following are the concepts changed people’s lives and changed the
of marketing? way businesses operate is called
A. production, selling, society A. Technical development
B. product, customer, society B. Technological development
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 25
C. Technology developing 232. The environment that is made up of broad
D. Technology developed forces, trends and conditions in the econ-
omy and society that the business has not
PRACTICE BOOK» NOT FOR SALE
227. All are the features of business environ- control over is called the
ment, except:
A. Macro Environment
A. Inter-relation
B. External Environment
B. Uncertainty
C. Internal Environment
C. Dynamic
D. Operating Environment
D. Simple
233. Following is not the importance of busi-
228. The Founder is Almost Never the Owner
ness environment:
in which Organization Type
A. Get first mover advantage
A. Corporation
B. complexity
B. Sole Proprietorship
C. Nonprofit C. Tapping useful resources
D. Limited Liability (LLC) D. better performance
229. Which is NOT included in the STEEPLE 234. Which one is an example of economic en-
Macro Environment? vironment?
A. Socio-Cultural Factors A. Changes in technology
B. Ethical Factors B. Expectation of society
C. Diversity Factors C. Change in exchange rate
D. Political Factors D. change in government’s rule and regu-
lation
230. It is a form of business organizations
where owner/s are jointly and individ- 235. The sale of sarees increases in the
ually liable for the actions of the other months of the year when a large number
owner/s. of marriages take place in India. The sa-
A. Corporation ree manufacturing companies make special
plans of sale for these months.Which di-
B. Incorporation
mension of business environment comes
C. Sole Proprietorship into picture here?
D. Partnership A. Economics Environment
231. In the month of October a greeting card B. Social Environment
manufacturing company has decided to in- C. Legal Environment
crease its scale of production of New Year
Greeting Cards.Identify the dimension of D. Political Environment
environment.
236. We earn $100 mowing a lawn. The cus-
A. Economics Environment tomer promises to pay later. Which of
B. Social Environment these accounts increases?
C. Political Environment A. Accounts Payable
D. Legal Environment B. Supplies
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 26
C. Accounts Receivable 242. Competition Act 2002 enabled
D. Cash A. Repeal of MRTP Act 1969
237. Business environment differs from coun- B. More stringent rules
try to country and even region to re-
C. Tight control over mergers
gion.Which feature of business environ-
ment is discussed in the given sentence? D. None of these
A. Uncertainty
NARAYAN CHANGDER
243. Which of the following is not a dimension
B. Complexity
of business environment?
C. Relativity
A. Internal
D. Inter-relatedness
B. Social
238. .Business environment does not have the
following characteristics: C. Political
A. uncertainty D. Economical
B. employees
244. Social pressures against child labour lead-
C. relativity ing to enactment of laws is an example of
D. complexity A. Complexity
239. Identify out of the LPG, which one is high- B. Interdependence
lighted:Selling shares of public sector un-
dertakings C. Uncertainty
A. Liberalization D. Universality
B. Privatization
245. The three inter-related environments
C. Globalization that impact a business include:
D. None
A. Internal, Micro, and Legislation
240. What involves providing guidance to B. Internal, External, and Operations
workers and work projects?
C. Internal, External Operating, and
A. Managing
Socio-cultural
B. Staffing
D. Internal, External Operating, and Ex-
C. Organizing ternal Macro
D. Directing
246. The finance minister reduced the repo
241. It is the degree to which society is uncom- rate to overcome recession. Which dimen-
fortable with risk, change, and situational sion of business is highlighted here?
uncertainty.
A. Economic environment
A. Individualism-Collectivism
B. Masculinity-Femininity B. Social environment
C. Time Orientation C. Political environment
D. Uncertainty Avoidance D. Legal environment
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 27
247. Greggs in Renfrew wants to expand its 252. People can purchase better quality of
store, but it has had its planning permis- goods and services which will improve
sion refused. What external factor is their quality because their incomes are ris-
PRACTICE BOOK» NOT FOR SALE
this? ing. Which characteristic of Business envi-
ronment?
A. Political
A. Totality of externa forces
B. Social
B. Specific and general forces
C. Competitive
C. Inter-relatedness
D. none of above
D. Dynamic nature
248. The examples of Internal business envi-
253. The use of trade barriers to protect a na-
ronment; except:
tion’s industries from foreign competition
A. Competition
A. Balance of trade
B. Management
B. NAFTA
C. Profit and Cash flow C. Quotas
D. Organization structure D. Protectionism
249. What are the process of business environ- 254. they provide the company with the fi-
ment assessment? nancial support needs. The company, of
A. scanning and monitoring only course, cannot exist without them:thus,
they greatly influence organizational man-
B. scanning, filter, monitor and forecast- agement.
ing
A. Pressure Groups
C. forecasting, monitor and making an as-
B. Employees
sessment
C. Suppliers
D. scanning, monitor forecasting and
making an assessment D. Investors or Owners
250. Which of the following is NOT a factor in 255. a highly populated city area
the international business environment? A. rural
A. political and legal B. urban
B. socialogical C. suburban
C. cultural and social D. agricultural
D. geographic 256. PEST analysis is used to:
251. Backward areas require A. Affects performance and working of
the company
A. Financial assistance
B. To understand the market growth or
B. Entrepreneurial support decline
C. Tax incentives C. offering little cost
D. All of these D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 28
257. What involves deciding what work will can be harmful to the diabetics.Which di-
be done and how it will be accomplished? mension of business environment is high-
A. Organizing lighted here?
B. Planning A. Political Environment
C. Staffing B. Legal Environment
D. Directing C. Economic Environment
D. Technological Environment
NARAYAN CHANGDER
258. The management function that monitors
the work effort: 263. Lorna Smith starts a business. Her busi-
ness buys a building for $35, 000 cash
A. Directing
that her real estate agent says is worth
B. Planning $50, 000. The business records the build-
C. Controlling ing as a $50, 000 asset, because Lorna be-
lieves that’s the real value of the building.
D. Organizing What has she violated?
259. Which factor is not included in Internal En- A. Monetary unit assumption
vironment? B. Economic entity assumption
A. Objectives C. Cost principle
B. Policies D. Nothing
C. Public
264. An agreement between two or more com-
D. Production-Method panies to share a business project-this
business is on a limited basis for control
260. refers to negative and unfavourable
external factors that are likely to create A. Licensing
hurdles for a firm * B. Joint venture
A. Opportunities C. Franchising
B. Threats D. Infrastructure
C. Benefits
265. Which of these is bad customer
D. None of the above
A. Polite Behavior
261. Employees, managers, location and legal B. Promising something you can’t
business structure are all part of which en-
vironment? C. Understanding the customer
A. External D. Following through with a promise
B. Internal 266. “The entity will remain in operation for
C. Macro the foreseeable future” is:
D. Operating A. The cost principle
B. The economic entity concept
262. Advertisements of a protein supplement
must inform the potential buyer that the C. The monetary unit assumption
product if taken beyond a given dose D. The going concern assumption
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 29
267. What financial statement tells the eco- 272. After new economic policy, there is a
nomic position (resources owned, debt shift from Production oriented approach to
owed) of company? approach.
PRACTICE BOOK» NOT FOR SALE
A. Income Statement A. Seller
B. Balance Sheet B. Market
C. Statement of Owner’s Equity C. Social
D. Statement of Cash Flows D. Commercial
273. What is the ‘common market’?
268. Apex body of legislation in India
A. A situation where EU member states
A. Parliament
were encouraged to trade freely and to
B. Assembly bring their economies closer together
C. Lok Sabha B. A market which uses the Euro currency
as the legal tender
D. Vidhan Sabha
C. A market which is supposed to be
269. What is one way a business can gain a achieved through liquidating the single
competitive advantage? market
A. by offering consumers a worse quality D. A market which uses the new Euro-
product pean constitution
B. by charging a higher price for a prod- 274. ITC planned for new hotels in India after
uct knowing that increase in India’s share of
C. by doing what everyone else is doing world tourism. Identify the importance of
in the market Business environment.
D. by creating something entirely new for A. It helps in tapping useful resources
the market B. It helps in coping rapid changes
C. It helps in assisting in planning and
270. The length of time invested money is con-
policy formulation
trolled by others is known as the
D. It helps in improving performance
A. conditions
B. term 275. In all the countries there is a free-flow
of goods and services under which of the
C. agreement following does it come?
D. return A. Liberalisation
B. Privatisation
271. Cultural changes are in the environ-
ment C. Liberalisation and Privatisation
A. Micro D. Globalisation
B. Market 276. Another name for Intermediaries is
C. Macro A. Supplier
D. none of above B. Consumer
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 30
C. Middle Man C. Inter-relatedness
D. Regulator D. Complexity
277. Which of the following is not a com- 282. When the manager allocates duties, au-
ponent of economic environment of busi- thority and responsibilities to subordi-
ness? nates (people below her), we call this
A. Interest rates A. Communication
B. Inflation rates B. control
NARAYAN CHANGDER
C. Literacy rates C. delegation
D. Rates of savings and investments. D. discipline
278. It includes the customers’ changing val- 283. Inflation
ues and preferences, customs could also af-
fect management practices in companies. A. Does not affect the business
A. Political Situations B. Is the general increase in the price of
goods and services
B. Economic Situations
C. Is an increase in the petrol price
C. Sociocultural Situations
D. Is decided by parliament
D. Technological Situations
279. A businesses ability to be profitable for 284. Which of the following are advantages of
this generation and the next, without dam- a bricks and mortar business model?
aging natural resources is known as: A. Products can be displayed.
A. Sustainability B. Customers can speak on an online chat
B. Flexibility with employees.
C. Organisational design C. High overhead costs.
D. Hierarchy D. The backroom can be used as a hang-
out
280. Owners/Managers, Employees, Organi-
sation Structure and Organisation Culture 285. Influencing the supervisory body does
are part of the not include:
A. Internal Business Environment A. Auditing
B. External Operating Environment B. Following regulations
C. External Macro Environment C. Bribery
D. none of above D. Lobbying
281. Identify the characteristic of Business 286. What is the accounting equation?
Environment:The company knows the de-
A. Assets + Revenue = Equity
mand for these products is unpredictable
as new designs keep on coming and the in- B. Assets = Liabilities + Equity
dustry keeps changing frequently. C. Assets + Liabilities = Equity
A. Relativity D. Assets + Revenues = Liabilities + Ex-
B. Uncertainity penses
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 31
287. Which of the following are not true about for producing their goods and rendering
Singapore and Hongkong their services.
PRACTICE BOOK» NOT FOR SALE
A. Both places have very competetive A. Stakeholders
economies
B. Costumers
B. Both places are independent countries
C. Suppliers
C. Both places have free economies
D. Employees
D. Both places have rather low taxation
293. Which of the following is not a character-
288. Software companies mainly located at istic of the Business Environment?
some places because of
A. Simple
A. Government incentives
B. Complex
B. Abundant supply of man power
C. Multi-faceted
C. Easy transport facilities
D. All of these D. Dynamic
289. In this stage of the life cycle viability of 294. which statement is true about barriers to
the idea is established and product or ser- networking?
vice is ready to market and sell A. i, ii and iv
A. Seed B. i, ii and iii
B. Start-up C. all of above
C. Growth D. none of above
D. Maturity
295. Climate and terrain are two examples of
290. The operating environment surrounding conditions that influence international
the business is part of business.
A. Micro environment A. geographic
B. Macro environment B. economic
C. Near environment C. political and legal
D. Bounded environment D. cultural and social
291. Which of the following is an example of
296. What is true of a sole proprietorship?
social environment?
A. money supply in the economy A. Two or more people are joined as co-
owners
B. consumer protection act
B. Sole proprietor is personally liable for
C. The constitution of the country business debts
D. composition of family C. The business must pay business in-
come taxes
292. They are those who ensure the organiza-
tions continuous flow of needed and rea- D. Business is taxed separately from the
sonably priced input or materials required owner
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 32
297. The process of creating a new or signif- C. Macro
icantly improved good, service or process D. none of above
is called
A. invention 303. Which of the following are advantages of
an operating franchise?
B. innovation
A. Established brand reputation.
C. inventing
B. High cost to buy in.
D. invented
NARAYAN CHANGDER
C. Low decision making.
298. Which aspects of business environment D. None of the above.
get affected when government of most of
the nations around the globe announces 304. The level of Management that makes
lockdown? strategic decisions
A. Social A. Lower
B. Economical B. Middle
C. Technological C. Top
D. All of these D. none of above
299. An overall reduction in consumer spend- 305. Legal support services can assist a busi-
ing power is known as ness with:
A. Recession A. Drawing up contracts.
B. Entrepreneurial factors B. Legal representation in court cases.
C. Socio economic issues C. Advising businesses on changes in the
D. Legislation law.
D. Putting contracts aside and ignoring
300. These days companies cannot avoid in- them
vesting in
A. Research 306. Alliance between 2 companies, bothown
a part of the company, share risks, tech-
B. Development nology and rewards
C. Research and Development A. Foreign Direct Investment
D. Employees B. Licensing
301. It is also known as business forecasting. C. Joint Venture
A. Business environment D. Internet
B. Business scanning E. Export
C. Business prediction 307. Which of the following is not a problem
D. Business solving technique?
302. A challenge related to a natural disaster A. Brainstorming
is a factor in the business environment. B. Indigenous knowledge
A. Micro C. Deep thinking and analysis
B. Market D. Force field
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 33
308. what is meant by business environ- A. 1991
ment? B. 1950
PRACTICE BOOK» NOT FOR SALE
A. the study of all external and internal C. 1981
factors that may affect a company
D. 1971
B. the organized efforts of an enterprise
to supply consumers with goods and ser- 313. Main characteristic of Indian society
vices for a profit A. Unity
C. consists of atoms and molecules, ag- B. Social stratification
glomeration of things in motion, alive, of C. Single identity
men and emotions, of physical and social
D. None of these
law, of forces and resistance
D. none of above 314. Who creates and governs accounting
standards in the United States?
309. The Prime Minister announced relaxation A. Securities and Exchange Commission
in import duties on electronic items. (SEC)
A. Technological dimension B. American Institute of Certified Public
B. Legal dimension Accountants (AICPA)
C. Social dimension C. Institute of Management Accountants
(IMA)
D. Political dimension
D. Financial Accounting Standards Board
310. The significant increase in marketing (FASB)
has forced on companies a new set of so-
cial and ethical issues that focus primarily 315. how many types of external environ-
on privacy issues. ment?
A. 2
A. cause-related
B. 3
B. telephone
C. 1
C. social network
D. 4
D. Internet
316. The purpose of applying for a patent is to
311. In August 1993, the Supreme court protect the company’s right to
passed an order to close the iron foundries
A. produce and sell an invention
around the famous Taj Mahal to avoid an
adverse impact of air pollution caused by B. pursue the development of an inven-
them on the beauty of Taj Mahal. Which tion
dimension is discussed here? C. keep new product development secret
A. Social D. market new products over the Internet
B. Economic 317. does not cause a shortage of supply
C. Political A. Strikes
D. Legal B. Climate conditions
312. In India, Liberalization & privatization be- C. Natural disasters
gan from D. A good supply network
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 34
318. This is the factor or consideration pre- C. export
sented by a seller as the reason that one D. import
product or service is different from and
better than that of the competition. 324. A company that establishes a new oper-
A. Unique Selling Plan ation in a foreign country has made:
B. Unique Selling Proposition A. An acquisition
C. Unique Pricing Policy B. A merger
NARAYAN CHANGDER
D. Finding Value-added C. A greenfield investment
D. A brownfield investment
319. Privatization was done by
325. When did Inctorems start being used in
A. Selling stakes in loss making PSUs
international trade?
B. Sale of partial interest in other PSUs
A. In 2020
C. Strategic sale of PSUs
B. In 1980s
D. All of these
C. In the 21st century
320. Culture has strong influence in D. Before the Second World War
A. Eastern countries
326. This is a meaningful and unforgettable
B. Western countries statement that captures the essence of the
C. Developed countries brand.
D. None of these A. Product Naming
B. Unique Selling Proposition
321. Any activity which slows or outright
blocks the free exchange of goods and ser- C. Branding
vices between nations. D. Tagline
A. Voluntary Trade 327. Choose the right step of process business
B. Specialization environment assessment
C. Currency Exchange A. Scanning, monitoring, forecasting,
making an assessment
D. Trade Barrier
B. Scanning, forecasting, monitoring,
322. Following is not a general force environ- making an assessment
ment:
C. scanning, monitoring, making an as-
A. political environment sessment, forecasting
B. social environment D. Forecasting, scanning, monitoring,
C. competitors environment making an assessment
D. Economic environment 328. If one company takes over another com-
pany (the purchase of one company by an-
323. When a product is bought from the global other) and establishes itself as the new
market, it is owner (no new company is formed) what
A. a domestic purchase is type of the corporate’s strategy?
B. a domestic transaction A. joint venture
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 35
B. merger D. Setting up Board of Industrial and Fi-
C. acquisition nancial Reconstruction
PRACTICE BOOK» NOT FOR SALE
D. new opening 334. Who has the power over political fac-
tors?
329. An example of indirect competition
A. Businesses
A. McDonalds and Burger King
B. The Government
B. Burger King and KFC
C. Boris Johnson
C. Pappa Jones and Dominos
D. Nicola Sturgeon
D. Dominos and KFC
335. Which of the following is not a compo-
330. It is an example of general forces of busi- nent of specific forces of business environ-
ness environment: ment?
A. Investors
A. Technological conditions
B. Suppliers
B. Customers
C. Government
C. Employees
D. Competitors
D. Investors
331. This type of economy exist when the ba-
336. The resources that a business must man-
sic needs of individuals and families are un-
age include:
changed for generations.
A. Human
A. Traditional
B. Financial
B. Market
C. Material/Information
C. Command
D. All the Above
D. none of above
337. Identify the environment factor which re-
332. LPG Policy has empowered the customers
quires that advertisement of baby food
who has more choices and the result is
must inform the potential buyers that
fragmented market. Identify the impact of
mother’s milk is best.
LPG policy.
A. Social
A. Increasing competition
B. Technological
B. More demanding customers
C. Legal
C. Rapidly changing technology
D. Market orientation D. Economic
333. Which of the following statement best de- 338. The date of “Month Ended January 31,
scribes the policy of Liberalization? 2020” should NOT appear on which finan-
cial statement?
A. Abolition of licensing requirement in
most of the industries A. Income Statement
B. Reduction in tax rates and lifting of un- B. Balance Sheet
necessary controls over the economy C. Statement of Owner’s Equity
C. Both a and b D. Statement of Cash Flows
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 36
339. Anyone can be a member, excluding B. External Operating Business Environ-
banks and insurance companies in what or- ment
ganization C. External Macro Business Environment
A. Corporation
B. LLC D. none of above
C. Sole Proprietorship
345. Which of these is not a purpose of the
D. Nonprofit Nonprofit organization
NARAYAN CHANGDER
340. A firm should make efforts that it has A. Scientific Work
type of customers? B. Profit
A. 1 C. Religion
B. 2 D. Education
C. 3
346. Ms. Payal ventured into her business of
D. Many
making different types of pickles. She got
341. An opportunity is set of circumstances a good response in the nothern part of In-
that a person can perceive as dia but the product was not accepted in
the southern states, as they have yet not
A. a way to make money
developed the taste of pickle in mustard
B. a way to gett rich quick oil.Identify the feature of business envi-
C. an avenue to success ronment.
D. none of above A. Inter-relatedness
B. Uncertainity
342. Liberalisation signifies:
A. INTEGRATION AMONG VARIOUS C. Dynamic
ECONOMIES OF WORLD D. Relativity
B. REDUCED GOVERNMENT RESTRIC-
347. How many factors make up the Internal
TIONS & CONTROL
Environment
C. POLICY OF PLANNED DISINVEST-
A. 6
MENT
B. 5
D. NONE OF THE ABOVE
C. 4
343. What is an important resource that in-
cludes facts, statistics, and opinions? D. 3
A. Human 348. Which best identify Internal factors influ-
B. Financial encing financial decisions?
C. Material A. Age
D. Information B. Gender
C. Occupation
344. Customers, Suppliers, Competition and
Interest Groups are part of the D. Social Influences
A. Internal Business Environment E. Marketing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 37
349. is not a branch of New Economic Pol- 354. What helps the business to find employ-
icy. ees who know how to do the necessary
work?
PRACTICE BOOK» NOT FOR SALE
A. Legislation
B. Liberalisation A. Staffing
C. Privatisation B. Organizing
D. Globalisation C. Planning
D. Controlling
350. Location, climate, terrain, waterways,
and natural resources refer to which fac-
355. A public listed company has which of the
tor of the international business environ-
following features:
ment?
A. Unlimited liability and an unlimited
A. geographic
number of shareholders.
B. economic
B. Limited liability and a limited number
C. political and legal of shareholders
D. cultural and social C. Limited liability and an unlimited num-
ber of shareholders.
351. This type of economy exist when what
is produced and consumed is based on the D. Unlimited liability and limited number
combination of the decisions made by indi- of shareholders
vidual consumers and businesses
356. Demonetization had direct impact on
A. Traditional
A. Social environment
B. Market
C. Command B. Political environment
D. none of above C. Economic environment
D. None of the above
352. involves monitoring the work effort.
A. Observing 357. Which of these is NOT an external user
of accounting information?
B. Controlling
C. Planning A. Creditors (bankers)
D. Staffing B. Investors
C. Company manager
353. When an employee has a grievance
and the grievance has not been resolved D. The IRS
through internal procedures or trough hav-
ing a middle man and an objective party 358. Which of the following is not an impact
needs to make the final decision of economic policy changes?
A. Conciliation A. Enhanced competition
B. Mediation B. Static technology
C. Arbitration C. Market orientation
D. Strategic response D. Necessity for change
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 38
359. HUL and several other FMCG companies 364. The owners’ claims to the assets of the
launched small sachets of shampoo and business are called:
other products according to the needs of A. Equity
the customers.
B. Debt
A. enables firm to identify opportunities
C. Return on assets
and first mover advantage
D. Expenses
B. Helps in tapping useful resources
365. We record transactions in US dollars and
NARAYAN CHANGDER
C. Helps in assisting in planning and pol-
icy formulation ignore change in value of the dollar over
time. We’re following:
D. It helps in improving performance
A. The cost principle
360. Following is not the dimension of the busi- B. The economic entity concept
ness
C. The monetary unit assumption
A. political environment
D. The going concern assumption
B. social environment
366. strategies of effective networking
C. privatization
A. come late
D. economic environment
B. follow up after event
361. A business which believes that a success C. spamming customer
story in one country can translate to all
D. ask about personal
other countries in which it operates is
A. Polycentricity 367. Swachcha bharat abhiyaan started by bjp
government is a part of
B. Ethnocentricity
A. Legal environment
C. Geocentricity
B. Social environment
D. Egocentricity
C. Political environment
362. Who takes vision one step further and D. Economic environment
makes it happen?
368. Business has control over the MACRO
A. Mid Level or Middle Managers Environment
B. Top Level or Executive Managers A. Complete
C. First Line or Supervisory Managers B. Some Control/influence
D. none of above C. No
363. Based on mutual benefits to be gained by D. none of above
members of network . This statement is 369. The processing and storing of data is
about: known as
A. Industrial business networking A. VAT
B. Informal business networking B. Information management
C. Referral business networking C. Malware
D. Online business networking D. Competition
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 39
370. feature of business environment 375. Components of Micro Environment
states that various factors of business en-
A. Customers
vironment affect each other.
PRACTICE BOOK» NOT FOR SALE
B. Quality control
A. Pervasive
C. Business Functions
B. Continuous
D. Economy
C. Dynamic
D. Interrelatedness 376. Which of the following is a factor of the
social environment of business?
371. The internal business environment con-
A. Customs
sists of
B. Rate of Interest
A. factors that directly impact the organi-
sation C. Level of education
B. factors that influence the operations of D. All of the above
the business
377. Which of the following is not a compo-
C. factors that influence the wider envi- nent of economic environment?
ronment in which the business operates
A. Composition of Trade
D. none of above
B. Infrastructure
372. Morrison’s does not have “scan as you C. Economic Development
go”. They can not currently afford it.
What internal factor is this? D. Legislation passed by government
A. Staff 378. It refers to the factors or elements out-
B. Finance side the organization which may affect, ei-
ther positively or negatively, the perfor-
C. Management mance of the organization.
D. none of above A. External Business Environment
373. Major source of revenue for Indian gov- B. Business Environment
ernment is C. Internal Business Environment
A. Corporation Tax D. Environment
B. Income Tax
379. It is defined as the process of measuring
C. GST or comparing one’s own products, services,
D. All of these and practices of those of the recognized in-
dustry leaders in order to identify areas
374. A debt that a business owes is: for improvement.
A. Revenue A. Environment
B. An asset B. Environmental scanning
C. A liability C. Benchmarking
D. Owner’s equity D. Business environment
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 40
380. technological environment includes: C. Requirements
A. advances in production technology D. Needs
B. advances in information technology
386. Businesses can control the effect of trade
C. popularity of e-banking unions through
D. all of the above
A. Collective bargaining
381. Planning is a B. strikes
NARAYAN CHANGDER
A. Managerial function C. Destruction of property
B. Economic function
D. Management control
C. Promotional function
D. None of these 387. Functions of management include:
A. Plan
382. Customer support
B. Organize
A. Draws in business
B. Scares people in C. Staff
C. Intimidates people D. All the Above
D. none of above 388. Which of the following is an advantage
383. When two or more firms come together of centralized decision making?
to create a new business entity that is A. Allows senior management to focus on
legally separate and distinct from its par- high level strategic decisions.
ents it is known as
B. Better motivation for more junior staff.
A. contract manufacturing
C. Improved local decisions.
B. Franchising
D. Avoidance of dysfunctional decision-
C. Joint ventures making.
D. Licensing
389. Which of the following best indicates the
384. It is the ongoing tracking of trends and oc- importance of business environment?
currences in an organization’s internal and
external environment that bear on its suc- A. Employing new workers
cess, currently and in the future. B. Result-oriented performance
A. Environment C. Coping with rapid changes
B. Environmental scanning D. Passing of new criminal law
C. Environmental forces
390. A business’ need to give back to the com-
D. Business Environment
munity in which they operate
385. These are luxuries, advantages and de- A. Triple bottom line
sires that every individual considers be-
yond necessity. B. Corporate social responsibility
A. Wants C. Strategic response
B. Desires D. Globalisation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 41
391. Identify out of the LPG, which one is 397. Nike is an example of what
highlighted:Lifting of unnecessary controls
A. Partnership
over the firms.
PRACTICE BOOK» NOT FOR SALE
A. Liberlization B. Sole Proprietorship
B. Privatization C. Corporation
C. Globalization D. LLC
D. None
398. What is a major reason why many US
392. The largest trading market in the world companies are corporations?
is the A. Life of corporation is limited by death
A. international investment market. of owner
B. long-term capital market B. Stockholders have limited liability for
C. U.S. stock market corporate debts
D. foreign exchange market C. Corporation is usually managed by the
owners
393. Following is not the features of business
environment: D. Most corporations are small-or
medium-sized
A. Totality of external forces
B. dynamic nature 399. Which of the following was not one of
C. industrial policy the reasons for introducing New Economic
Policy?
D. uncertainty
A. Increasing fiscal policy
394. Which of these is not a key office activity
B. Fall in price level
A. Deleting Information
C. Gulf Crisis
B. Searching for information
C. Managing Information D. Poor performance of public sector
D. Communicating Information 400. Important stakeholders in micro environ-
395. The owner is not reliable for the problems ment
in which of the following organizations A. Customers
A. Corporation B. Suppliers
B. Sole Proprietorship C. Employees
C. Nonprofit
D. All of these
D. Limited Liability (LLC)
401. What are the stage of managing a busi-
396. Following is the impact of government
ness network related to the statement
policy changes on business and industry:
A. stage 1
A. technological upgradation
B. Demanding customers B. stage 2
C. Increased competition C. stage 3
D. All of the above D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 42
402. Which component of business environ- C. $3, 500
ment resulted in the relaxation of ban im- D. $500
posed on the Foreign Direct Investment?
A. Economic Environment 407. Five year planning is a
B. Political Environment A. Medium term activity
C. Social Environment B. Long term activity
C. Short term activity
D. Legal Environment
NARAYAN CHANGDER
D. None of these
403. An interest groups that try to exert in-
fluence on the organization’s decisions or 408. Language, family, religion, customs, tra-
actions. ditions, and food refer to which factor of
the international business environment?
A. Stakeholders
A. geographic
B. Pressure Groups
B. economic
C. Suppliers
C. political and legal
D. Employees
D. cultural and social
404. Which one of the following statements
about the impact of technological develop- 409. means the external environment
ments is not true? trends and changes that will hinder a
firm’s performance.
A. Technology developments have sup-
ported corporate delayering A. Opportunities
B. Technology developments tend to ad- B. Threats
versely affect employee relations C. Weakness
C. Technology developments creates risk D. Strengths
for long-range product/market planning
410. Which of the following are the impact of
D. none of above govt. policy changes on business & indus-
try? *
405. What are taxes a country places on prod-
ucts as they cross its borders? A. Increased competition
A. Laws B. More Demanding customers
B. Tariffs C. Need for change
C. Quotas D. All of the above
D. none of above 411. A managerial tool used to assess the en-
vironment and to gather important infor-
406. How much is net income if, during the mation that can be used for strategic plan-
month:$4, 000 is earned on account$4, ning.
000 collected from a customer for last
month’s services$500 paid for repair ex- A. Environmental Scanning
pense$300 paid for rent owned last month B. SWOT Analysis
A. $7, 500 C. Survey Analysis
B. $4, 000 D. WOTS Analysis
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 43
412. Which component of business environ- A. geographic
ment requires that advertisements of baby
B. economic
foodmust necessarily inform the potential
PRACTICE BOOK» NOT FOR SALE
buyers that mother’s milk is the best? C. political and legal
A. Political Environment D. cultural and social
B. Economic Environment
418. Based on the combination of the decisions
C. Legal Environment made by individual consumers and busi-
D. Technological Environment nesses.
413. Which of the following is a part of the A. money markets
business environment? B. demand
A. Customers
C. market economy
B. Suppliers
D. corporation
C. Competitors
E. financial risk
D. All of the above
414. Who pays the taxes in an LLC 419. Influences that come from within the busi-
ness are in the
A. The Business
A. macro environment
B. The Customers
B. external environment
C. Owner
D. The Government C. operating environment
D. internal environment
415. R & D stands for
A. researched and developed 420. It is the degree to which a society empha-
B. researching and developing sizes short-term thinking versus greater
concern for the future or long-term think-
C. researching and development ing.
D. research and development
A. Uncertainty Avoidance
416. Purchasing the right to use a company B. Individualism-Collectivism
name or business process in a specific way
ex. McDonald’s, Burger King, KFC and C. Time Orientation
Pizza Hut * * D. Power Distance
A. Licensing
421. Religion and language are two examples
B. Joint venture
of conditions that influence interna-
C. Franchising tional business.
D. Infrastructure A. political and legal
417. Technology, education, inflation, ex- B. cultural and social
change rate, and infrastructure refer to
C. geographic
which factor of the international business
environment? D. economic
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 44
422. One of the components of New Industrial B. labor strikes
Policy has led to reduction in tax rates and
C. rising costs of supplies
lifting of unnecessary control and restric-
tions over private sector? D. under-budgeting supply costs
A. Liberalization 428. Identify out of the LPG, which one is high-
B. Privatization lighted:Easy movement of information and
C. Globalization technology with rest of the world.
NARAYAN CHANGDER
D. None A. Liberalization
B. Privatization
423. is not a feature og business environ-
ment. C. Globalization
A. Relativity D. None
B. Complexity
429. A distinct legal entity formed by complet-
C. Uncertainty ing required legal documents in a specific
D. Employability state.
424. Which of the following are the dimen- A. money markets
sions of the business environment? * B. demand
A. Economic Environment C. market economy
B. Social Environement D. corporation
C. Technological Enrionment E. financial risk
D. All of the above
430. The growing awareness about healthcare
425. Entry of foreign firms in India is an exam- has led to an increase in the demand for
ple of healthcare products and services in the
A. Opportunity country. Identify the feature of business
environment being described in the above
B. Threat
case.
C. Specific force
A. Dynamic nature
D. General force
B. Uncertainty
426. What level of management is responsible C. Relativity
for implementing goals set by upper man-
agement? D. Interrelatedness
A. Mid Level or Middle Managers 431. Globalization signifies
B. Top Level or Executive Managers
A. integration among various economies
C. First Line or Supervisory Managers of the word.
D. All the Above B. disinvestment in public sector.
427. Which of the following is not a possible C. reduced government controls and re-
supplier impact on product development? strictions.
A. shortages or delays in supplies D. nationalization of industries
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 45
432. Involves selling a good or service in an- 437. Managers need to be able to communi-
other country with a limited adaptation, cate, interact, and build relationships best
there’s no need to invest in factories describes what type of skills?
PRACTICE BOOK» NOT FOR SALE
A. Foreign Direct Investment A. Interpersonal
B. Exporting
B. Technical
C. Licensing
C. Conceptual
D. Joint Venture
E. Internet D. Management
433. Following are the elements of political en- 438. Vista started the year with $130, 000 of
vironment: assets and $45, 000 of liabilities. During
A. Educational system and literacy rates the year, they had $110, 000 of revenues
and $80, 000 of expenses. The owner
B. family structure
made no additional contributions but took
C. caste and occupational structure $55, 000 of withdrawals. How much was
D. None of the above owner’s equity at the end of the year?
434. An example of a business that frequently A. $80, 000
participates in strategic alliances is B. $110, 000
A. Krispy Kreme
C. $55, 000
B. Woolworths
D. $60, 000
C. Pick n pay
D. Starbucks 439. Regional disparities arise because of
435. what are the types of business network- A. Negligence of some areas
ing?
B. Lack of planning
A. formal, referral and industrial busi-
ness networking C. Lack of skill set
B. manufacturing, service and industrial D. All of these
business networking
C. online, food and beverage and service 440. We received $100 from a customer that
business networking was owed from last month. The effect is:
D. referral, informal and agriculture busi- A. Assets increase $100, equity in-
ness networking creases $100
436. The importance of understanding of busi- B. One asset increases $100, another as-
ness environment is signified by: set decreases $100 (no net change to as-
A. The importance of understanding of sets)
business environment is signified by:
C. Assets increase $100, liabilities de-
B. coping with rapid changes crease $100
C. improvement in performance D. Assets increase $100, liabilities in-
D. all of the above crease $100
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 46
441. Which of the following dimensions of 446. The key factors that affect a country’s
business environment includes legisla- level of economic development include all
tion’s passed by government authorities? of these EXCEPT:
A. Social environment A. Agricultural Dependency
B. Legal environment B. Literacy Level
C. Economic environment C. Unemployment Rate
D. Technological environment D. Technology
NARAYAN CHANGDER
E. Political environment 447. Decision making is decentralised and key
personnel need to be recruited from the na-
442. The owner makes a withdrawal from her tion being targeted is a feature of
company. How is the accounting equation
affected? A. Polycentric
B. Geocentric
A. Assets increase, liabilities decrease
C. Ethnocentric
B. Assets, liabilities, and equity all stay
the same D. none of above
C. Assets decrease, equity increases 448. Examples of external environment; ex-
D. Assets decrease, equity decreases cept:
A. Fashion
443. It is a process by which compromise
or agreement is reached while avoiding ar- B. Organization Structure
gument. C. Political
A. Questioning skills . D. Competition
B. Speaking skills 449. Which of the following is correct
C. Negotiating skills A. Growth is better than development
D. Argument skills B. Development is the end and growth is
means to
444. What is one factor of the external oper-
ating environment of a business? C. Growth is the end
D. None of these
A. Customers
B. Competitors 450. Subsidies are part of which environ-
ment?
C. Suppliers
A. Political
D. Interest Groups
B. Social
E. All of the above
C. Economic
445. are all of a business’s employees. D. Legal
A. Financial Resources
451. How many factors make up the Operat-
B. Material/Information Resources ing Environment?
C. Human Resources A. 3
D. None of the Above B. 4
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 47
C. 5 457. How many types of business environ-
D. 6 ment?
PRACTICE BOOK» NOT FOR SALE
A. 3
452. Carbon credits related to
B. 1
A. Business responding to climate
C. 2
change
D. 4
B. Crediting carbon in ledger
C. Carbon accumulation in a company 458. consists of factors in the company’s im-
mediate environment that affects the per-
D. None of these formance of the company.
453. High economic growth means high human A. Micro-environment
development B. Macro-environment
A. Always correct C. PESTEL Analysis
B. Always not correct D. Benchmarking
C. Depends on the efforts
459. The organized exchange of the ownership
D. None of these shares of public corporations is a
454. Vision and Mission are in the environ- A. financial market
ment B. stock market.
A. Micro C. capital market
B. Market D. commodity market
C. Macro 460. Which of the following is not a customer
D. none of above market targeted by companies?
A. cultural markets
455. Which of of the following is a potential
advantage of decentralisation? B. reseller markets
A. Risk reduction in relation to opera- C. government markets
tional decision-making D. consumer markets
B. More accountability at lower levels 461. A marketing practice of creating name,
C. Consistency of decision-making symbol or design that identifies and differ-
across the organisation entiate a product from the other products.
D. none of above A. Product Naming
B. Unique Selling Proposition
456. Which of the following is a feature of de-
monetisation? C. Branding
A. Tax administration measure D. Tagline
B. Channelising savings into the formal fi- 462. Which is an example of a macro economic
nancial system factor?
C. Development of less-cash economy A. interest rates
D. All of the above B. research and development
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 48
C. climate change 468. Which two of these are examples of bad
customer support
D. none of above
A. Being polite
463. The ability to see the big picture and think
B. Bad language
about how things will work together:
C. Listening to customer
A. Managing
D. Following through with a promise
B. Conceptual Skills
NARAYAN CHANGDER
E. Yelling at the customer
C. Controlling
D. Management Function 469. Following is not the dimension of the busi-
ness environment
464. Following are the elements of social envi- A. political environment
ronment:
B. social environment
A. Educational system and literacy rates
C. legal environment
B. family structure
D. nature
C. caste and occupational structure
470. what are the five forces model?
D. all of the above
A. formal, informal, referral, industrial
465. Legal rules and regulations relevant to and online business
business are included in environment
B. political-legal, economic, technologi-
of business.
cal, socio-cultural & networking
A. legal
C. competitive rivalry. threat of new en-
B. political try, supplier power, buyer power & threat
of substitution
C. economic
D. plan the network, build, nurturning,
D. technological
maintain and record
466. External environment can be broken into: 471. Relaxing the restrictions and controls im-
A. 4 posed on Business and industry means *
B. 3 A. Globalisation
C. 2 B. Liberalisation
D. 1 C. Privatisation
D. All of the above
467. A process of making a new product to be
sold to the customers. 472. Expand EODB
A. Product Analysis A. Ease of Doing Business
B. Product Conceptualization B. Ease of Doing Banking
C. Product Development C. Easy Office Database
D. Product Implementation D. None of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 49
473. Political and legal influences, societal in- C. Inter-relatedness
fluences, economic conditions, technologi- D. Relativity
cal issues, CSR and global issues are all
PRACTICE BOOK» NOT FOR SALE
part of which environment? 478. globalisation signifies:
A. internal A. INTEGRATION AMONG VARIOUS
B. external ECONOMIES OF WORLD
C. macro B. REDUCED GOVERNMENT RESTRIC-
TIONS & CONTROL
D. operating
C. POLICY OF PLANNED DISINVEST-
474. When an order is placed with a supplier MENT
for raw materials which of the activities in D. NONE OF THE ABOVE
Porter’s Value Chain is involved?
A. Inbound logistic 479. Identify which of the following refer to
the micro environment?
B. Operations
A. Supplier, Strategic partner, competi-
C. Procurement
tors
D. Marketing and sales
B. Political, economic, sociological
475. Following is not a specific force environ- C. Organization, customers, legal
ment?
D. none of the above answers are correct
A. customers
480. Liberalization means
B. suppliers
A. Integration among economies
C. creditors
B. reduced government control and re-
D. social
striction
476. Goods and services exchanged between C. policy of planned disinvestments.
businesses and customers across the
D. providing greater role to private sec-
world is best described as
tor.
A. globalisation
481. Relaxation or removal of strict rules and
B. globalised markets
regulations is a part of
C. foreign markets
A. Liberalisation
D. global markets
B. Globalization
477. Since more number of people have be- C. Privatization
come more beauty and health conscious,
D. All of the above
our economy has witnessed an unprece-
dented surge in the number of health and 482. Business Environment means *
beauty spas and wellness clinics. Related
feature of business environment being de- A. Internal Environment of Business
scribed in the above lines is B. External Environment
A. Totality of external forces C. Internal and External Environment
B. Dynamic nature D. Economic Environment of country
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 50
483. Which of the following are connected B. Source of Capital
stakeholders to an organisation? (i) Em- C. Competent Management
ployees (ii) Suppliers (iii) Managers (iv)
Customers D. Unlimited Life
A. (i) and (iii) 488. ‘Colour television wiped out the market
for black & white television.’ which di-
B. (i) and (iv)
mension of business environment is high-
C. (ii) and (iv) lighted in the given statement?
NARAYAN CHANGDER
D. (ii) and (iii) A. Technological Environment
484. Which organization type of difficulty em- B. Legal Environment
ploying managers C. Social Environment
A. Corporation D. Economic Environment
B. LLC 489. Smith Company pays $300 cash to an em-
C. Partnership ployee for this week’s wages. The $300
paid by Smith is a(n):
D. Sole Proprietorship
A. Revenue
485. ACME receives money from the owner,
B. Owner’s draw
Mr. R. Runner. The two accounts involved
are: C. Expense
A. Cash and Runner, Capital D. Liability
B. Runner, Capital and Accounts Payable 490. What is the logical process of coordinat-
C. Runner, Capital and Accounts Receiv- ing resources, such as employees, in order
able to accomplish an organization’s goals?
D. Accounts Payable and Cash A. Human Resources
B. Objectives
486. Which of the following is known as part
C. Management
of the promotion mix?
D. Planning
A. sales promotion, advertising, public re-
lations 491. What do the government expect in re-
B. advertising, direct marketing, per- turn?
sonal selling A. funds
C. public relations, personal selling, di- B. to assist in export
rect marketing C. tax incentives
D. all the answers are correct D. Development of backward areas
487. It is an advantage of a corporation where 492. What is it called when a product loses
company owners are only liable for the value over time?
amount they invested. Creditors and
A. Depreciation
lenders have no claim to the owners’ per-
sonal assets for payments owed by the B. Inflation
shareholders. C. Assets
A. Limited Liability D. Growth
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 51
493. The agency responsible for monetary pol- C. Rigid
icy in India D. None of these
PRACTICE BOOK» NOT FOR SALE
A. Finance Ministry
498. Which of the following are examples of
B. RBI
capital resources?
C. MOSPI
A. Factories
D. Parliament
B. Technology
494. The Union Cabinet has given ‘in-principle’
C. Machinery
nod to divest stakes in Air India-a wholly
government owned airline. This means the D. Company Vans
government is willing to shed a substan-
tial sector. Identify the concept being de- 499. Micro enviroment factors are:
scribed in the above lines. A. political and technological
A. Liberalisation B. suppliers and buyers
B. Privatisation C. economic and socio cultural
C. Globalisation D. none of above
D. Demonetisation
500. The way a Business divides, organises
495. Companies are using social media in their and coordinates its activities is an example
marketing strategies to allow of which Internal Environmental factor?
A. customers to post comments in sup- A. Owner/s/Management
port of their products
B. Employees
B. two-way conversations with cus-
tomers and prospective customers C. Organisational Structure
C. easy access to customer databases D. Organisational Culture
for one-to-one marketing
501. The best type of regulation is
D. announcements to reach a larger audi-
ence A. Self regulation
B. Industry regulation
496. Which statement is true?
C. Government regulation
A. Hongkong and Singapore are both
placed high in world economic rankings D. None of these
B. Hangkong is doing economically much 502. “Due to enforcement of Euro-IV emis-
better than Singapore sion norms, an automobile company had to
C. Singapore is doing economically much phase out one of its model” . Identify the
better than Hongkong dimensions of environment highlighted in
D. Hangkong and Singapore are both Chi- the given statement
nese cities A. Technological environment
497. Technological environment is B. Legal environment
A. Static C. Economic environment
B. Dynamic D. Social environment
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 52
503. Sourcing money from the business 508. What does PEST mean?
owner’s personal finances is which of the A. Politics, Economy, Social, Technology
following sources of finance?
B. Politics, Economical, Social, Technol-
A. Equity capital. ogy
B. Debt capital. C. Political, Economic, Sociocultural,
C. Grant. Technological
D. Overdraft capital. D. Politicians, Economist, Socialist, Tech-
NARAYAN CHANGDER
nologist
504. Although managers don’t perform the
same tasks as their employees, they still 509. Which of the following does not charac-
need to understand certain aspects of the terize the business environment?
business is an example of what? A. Uncertainty
A. Interpersonal Skills B. Employees
B. Conceptual Skills C. Relativity
C. Technical Skills D. Complexity
D. All the Above
510. What does the P in PESTEC stand for?
505. “Increase in use of mobile phones and A. Political
iPods instead of papers and radio” refers
B. Party
to an example of key component of gen-
eral environment of business environment. C. Profit
Identify the component of business envi- D. Partial
ronment.
511. are all of the sources of money avail-
A. Political environment
able to the business.
B. Legal environment
A. Material Resources
C. Economic environment
B. Financial Resources
D. Technological environment
C. Information Resources
506. In this stage, the needs of the target mar- D. Human Resources
ket are identified, reviewed and evaluated
512. This type of economy exist when the gov-
A. Concept Development
ernment decision-makers determine what
B. Economic Analysis goods and services are needed and how
C. Project Development and when they will be produced.
D. Refine Specification A. Traditional
B. Market
507. Select which ONE of the followings is
GAP 2 C. Command
A. Treated as a key player D. none of above
B. Kept satisfied 513. is not a feature of demonetization.
C. Kept informed A. Elimination of Corruption
D. none of above B. Elimination of Counterfeit currency
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 53
C. Money laundering 519. Which options below are considered to be
a key feature of a business
D. Elimination of currency
PRACTICE BOOK» NOT FOR SALE
A. Goods and services
514. Businesses that both sell All Gold Tomato B. Exchange
sauce are an example of
C. Be successful whatever the cost
A. Indirect competition
D. Achieve a positive outcome according
B. Direct competition to business goals
C. Suppliers
520. It means all the internal and external
D. A monopoly factors of that affect how the company
functions including employees, customers,
515. South Africa’s political environment is management, supply and demand, and
A. Stable business regulations.
B. Unstable A. Business Environment
B. Business Firm
C. Relatable
C. Local Environment
D. Responsive to citizens
D. International Firm
516. inspires people and sets goals
521. Regional imbalances in India are largely
A. Leader due to
B. Manager A. Concentration of raw material sources
C. Employer B. Lack of education and knowledge at lo-
D. none of above cal level
C. Lack of local entrepreneurship
517. What is a cost-benefit analysis?
D. All of these
A. The taxes that people pay when they
buy something. 522. Analysis of the changes in business en-
vironment explains which feature of busi-
B. A process that allows businesses and ness environment?
individuals to analyze where to spend
money. A. Complex
B. Static
C. The amount of money required to have
or do something C. Dynamic
D. none of above D. Diverse
518. How many process of business environ- 523. Ethnocentricity can be defined as the
ment assestment? A. scientific description of individual hu-
A. 1 man societies
B. systematic study of an ethnic group’s
B. 2
religious core
C. 3
C. merging of all ethnic practices into one
D. 4 homogeneous culture
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 54
D. belief that one’s own ethnic group or 529. what are the barriers in networking?
culture is superior to that of others A. bad manners and speak the truth
524. Identify out of the LPG, which one is high- B. lack of preparation and research and
lighted:NDPL and BSES instead of Delhi be discipline
Vidyut Board C. lack of knowledge and making empty
A. Liberalization promises
B. Privatization D. bad manners and speak confidently
NARAYAN CHANGDER
C. Globalization 530. “One of the features of business environ-
ment states that something which is new
D. None
today, may become outdated or obsolete
525. Components of Market Environment after sometime.” identify the feature.
A. Customers A. Interrelatedness
B. Dynamic
B. Regulators
C. Complexity
C. Employees
D. Relativity
D. Government
E. Competitors 531. Too much regulation of business will
cause
526. It is a form of business organization that A. Loss of investments
is considered by law to be a unique entity,
B. Loss of employment
separate from those who own it.
C. Regional imbalances
A. Partnership
D. All of these
B. Corporation
C. Non-Profit Corporation 532. A sole trader business structure consists
of
D. Sole Proprietroship
A. only one owner
527. The condition in business environment B. up to 20 owners
keep changing as it is
C. shared decision making
A. External environment D. limited liability
B. Complex
533. A back up plan made in advance I saw
C. Dynamic known as
D. None of the above A. An ad hoc plan
528. Unemployment is at an all time high. B. A contingency plan
What external factor is this? C. A back up plan
A. Political D. A floor plan
B. Economic 534. What is telecommuting
C. Competitive A. Working in a mobile office
D. Technological B. Working from an office
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.1 Business Environment 55
C. Working from home 539. It refers to an individual’s ability to fa-
D. none of above vorably receive and adjust to an unfamiliar
way of doing things.
PRACTICE BOOK» NOT FOR SALE
535. We receive $100 from the customer A. Cultural Difference
whose lawn we mowed last month. What
is the effect? B. Cultural Intelligence
A. Cash increases and Accounts Receiv- C. Culture Different
able decreases D. Culture Intelligence
B. Accounts Receivable increases and
540. The 3 distinct business environments in-
Service Revenue decreases
clude
C. Cash increases and Service Revenue
A. Internal, Internal Operating, External
increases
Macro
D. Cash increases and Accounts Payable
B. Internal, External Operating, External
decreases
Macro
536. Specific forces include C. Internal Macro, External Operating,
A. Technological External Macro
B. Political D. none of above
C. Customers 541. Objectives is another word for:
D. Investors A. Goals
537. Identify the point of importance of busi- B. Planning
ness environment from following state- C. Organizing
ment.ITC Hotels planned new hotels in In-
D. None of the above
dia after observing boom in tourism sec-
tor. 542. Business Environment is a group of
A. It enables the firm to identify opportu- powers.
nities and getting the first mover advan- A. Special
tage.
B. General
B. It helps in tapping useful resources
C. Internal
C. It helps in assisting in planning and
policy formulation D. Special and General
D. none of above 543. Which factor of the External Operating
Environment is affected when a rival busi-
538. Components of MACRO Environment ness makes changes to its product or pric-
A. Intermediaries ing?
B. Political A. Customers
C. Demographics B. Competitors
D. Competitors C. Suppliers
E. Exchange Rate D. Interest Groups
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 56
544. refers to nation’s transpiration, com- stitutions, namely, legislature, executive
munication, and utility systems. and judiciary which usually play a useful
A. Intrastate commerce role in shaping, directing, developing and
controlling business activities.
B. Infrastructure
A. Politico-Legal Environment
C. Global mobility
B. Economic Environment
D. Trade barriers
C. Socio-Cultural Environment
NARAYAN CHANGDER
545. includes the activities of three political in- D. Technological Environment
1.2 International Business
1. Which of the following refers to the legal A. shared knowledge
rights over the use to which a resource is B. synergy
put and over the use made of any income
that may be derived from that resource? C. shared customers
A. Theocratic right D. ease of market entry
B. Property right 5. If US currency , less dollars are needed
C. Trade right to buy euro. Conversely, if US currency
, more dollars are needed to buy euro.
D. Financial right
A. depreciates, apreciates
2. In January 2020, the Philippines increased
a tax imposed on alcohol products to 22 B. has a floating exchange rage, has a
percent of the net retail price. What type fixed rate
of tax is this? C. apreciates, depreciates
A. VAT tax D. none of above
B. sales tax
6. Absolute advantage theory was intro-
C. excise tax duced by
D. customs duty A. Michael Porter
3. Walt Disney permits a German clothing B. David Ricardo
manufacturer to market children’s paja- C. Adam Smith
mas embroidered with Mickey Mouse in
return for a percentage of company sales. D. Raymond Vernon
This is an example of
7. An international organization with 190
A. franchising member nations that are united to solve
B. licensing world problems.
C. leasing A. NAFTA
D. piracy B. NATO
4. Which of the following is not a benefit of C. United Nations
strategic alliances? D. RIO PACT
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 57
8. If a country has a highly eductated popula- 13. Any activity that seeks profit from selling
tion, advanced technology, and focuses on goods and services to others.
international business and foreign trade,
PRACTICE BOOK» NOT FOR SALE
A. Global
that country is considered to be:
B. Business
A. Industrialized
C. Domestic company
B. Less-Developed
D. Dependence
C. Developing
14. A country that exports more that it im-
D. none of above ports has a:
9. List the four types of competitive situa- A. Trade deficit
tions from the lowest degree of competi- B. Trade surplus
tion to the highest.
C. Positive trade status
A. monopoly, oligopoly, monopolistic
D. None of these
competition, pure competition
B. oligopoly, monopoly, pure competition 15. Not a continent
C. pure competition, monopoloy, A. Africa
oligopoly B. Asia
D. none of above C. North America
D. Greenland
10. To gain in value. (For example, if you
bought a house in 1998 for $100, 000 and 16. Australia’s main export in 2014 to the UK
sold it in 2011 for $120, 000) was
A. Culture A. Beef
B. Appreciate B. Gold
C. Depreciate C. Pearls
D. Trade D. Silver
11. When a country’s imports are greater than 17. If nations limit trade in of clothing who will
its exports, it is known as a: benefit?
A. Trade deficit A. Domestic Consumers of clothing
B. Domestic producers of clothing
B. Trade surplus
C. Foreign Producers of clothing
C. Trade negativity
D. department stores who sell clothing
D. None of these
18. All business activities needed to create
12. Planning that is a result of being forced to ship and sell goods across national bor-
react to international pressure is known as ders:
A. Strategic planning A. International Business
B. Tactical planning B. Global Dependency
C. Reactive planning C. Domestic Business
D. Proactive planning D. None of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 58
19. Which of the following documents is not re- B. The measure of the amount of money
quired in connection with an import trans- a country owes to other countries.
action? C. The measure of the output of products
A. Bill of lading. created within a country.
B. Shipping bill. D. none of above
C. Certificate of origin. 24. In 2018, China announced a 25 percent tax
D. Shipment advice. on $16 billion worth of US-made goods, in-
NARAYAN CHANGDER
cluding vehicles and crude oil. What type
20. a risk associated with the sale and accom- of trade barrier did China use?
panying transactions between two foreign
A. import quota
markets
B. import tax (tariff)
A. Credit/Sale Risk
C. embargo
B. Risk
D. export quota
C. Economic Risk
D. Legal Risk 25. What is a benefit of Global Sourcing?
A. Environmental factors
21. What is a trade deficit?
B. Cost Efficiency
A. When the value of exports exceeds the
value of imports C. Weak legal environment
D. Risk of creating competitive
B. when the value of imports exceeds the
value of exports 26. This word comes from the base “busy” +
C. when the values of imports and ex- ness, or the act of being busy with money,
ports are equal financial, transactions, sales, and purchas-
ing.
D. when the value of imports for one na-
tion is greater than the value of imports A. Quota
for another nation B. Resource
22. Gross Domestic Product (GDP) is: C. Currency
A. The measure of the amount of money D. Business
a country owes to other countries.
27. The difference between imports and ex-
B. The measure of the output of products ports is called
created within a country.
A. Balance of Power
C. The measure of the difference be- B. Balance of Trade
tween what a country sells versus what a
country buys from other countries. C. Trade Deficit
D. none of above D. Loss
23. Foreign debt is: 28. Which of the below tends to be narrowly
focused on short term objectives?
A. The measure of the difference be-
tween what a country sells versus what a A. Strategic planning
country buys from other countries. B. proactive planning
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 59
C. Tactical planning 34. represents the beliefs, customs and at-
titudes of a distinct group of people.
D. Long term planning
PRACTICE BOOK» NOT FOR SALE
A. Lifestyle
29. Any commercial transaction that crosses B. Heredity
the borders of two or more nations is
known as C. Culture
A. international business D. Norm
B. global manufacturing 35. LVMH uses all of the following entry meth-
ods in its international operations except
C. domestic marketing
D. market segmentation A. acquiring small foreign firms
30. Which item was our most valuable export B. entering licensing agreements
to Japan in 2014? C. establishing franchises
A. Beef D. exporting products
B. Coal 36. Capitalistic, communistic and Mixed are
C. Cheese the types of
D. Copper A. Social System
B. Economic System
31. A is a subset or part of a larger culture
C. Cultural Attitudes
A. Culture D. Political System
B. Subculture
37. One advantage to the business of becom-
C. Second Family ing a multinational is that:1) it will be able
D. Nuclear Family to produce goods closer to each country’s
market2) it will have fewer factories and
32. Which is one of the ways of doing business operating bases3) communication will be
overseas? easier within the business4) it will tend
to produce the same basic product for mar-
A. Internet kets throughout the world
B. Antidumping A. 1
C. Countervailing Duties B. 2
D. Buy America C. 3
D. 4
33. The GATT Anti-Dumping Agreement was
the result of which round of negotiations? 38. If the United States grants patents to
A. Dillion three pharmaceutical companies producing
a vaccination against one disease, what
B. Tokyo type of market situation will exist?
C. Kennedy A. oligopoly
D. Uraguay B. pure competition
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 60
C. monopoly C. Commercial Risk
D. anarchy D. Granting most favored nation status
39. To lose value. For example, if you bought a 44. One potential advantage for a country of
new Toyota Corolla in 2001 for $30, 000, encouraging a multinational business to
the value of the car decreased and you can set up is that it will:
now only sell it for $11, 000. A. always create more jobs than might be
A. Ethics lost
NARAYAN CHANGDER
B. Translate B. keep all of the profits made within the
country
C. Depreciate
C. not compete with the existing national
D. Appreciate
businesses
40. To discuss a deal or problem in the hope of D. pay taxes to the government
reaching an agreement.
45. A convenience store gave the rights to
A. Consumer
a company in Mexico to sell its products
B. Trade barrier and services. This is an example of which
C. Negotiate global marketplace main entry mode?
D. Market A. Franchising
B. Joint Venture
41. When doing a creditability study of your
counterpart, which of the following is not C. Licensing Agreement
included in the creditability report? D. none of above
A. capital held 46. A system of learned, shared, and unifying
B. business scope beliefs, values, and assumptions is known
as
C. executive’s hobbies
A. Culture
D. credit status
B. Collectivism
42. Which is not an Indian Multinational Com-
C. Individualism
pany?
D. Values
A. Asian Paints
B. Unilever 47. If a company is headquartered in Taiwan,
then Taiwan is the company’s
C. Piramal
A. host country
D. Wipro
B. home country
43. In 1979, the Shah of Iran was overthrown C. dominant country
and a new government was established.
This government immediately seized con- D. competitive country
trol of all US companies and assets in Iran. 48. A customer service representative is a
This is an example of product created by what type of re-
A. Privatization source?
B. Expropriation A. Capital
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 61
B. Land 53. Product life cycle theory was introduced
C. Labor by
PRACTICE BOOK» NOT FOR SALE
D. none of above A. Michael Porter
B. David Ricardo
49. Delvin Pharmaceuticals, a U.S. firm, is con-
C. Adam Smith
sidering the idea of entering the Japanese
market. Which entry mode will Delvin D. Raymond Vernon
most likely use?
54. Which country is involved in a huge coun-
A. exporting tervailing and antidumping duty crisis with
B. licensing the United States over solar panel materi-
als?
C. turnkey
A. China
D. franchising
B. India
50. Who introduced the theory of absolute ad- C. Mexico
vantage?
D. Bahrain
A. Adam Smith
55. Economies of scale arise from which of the
B. David Ricardo
following sources?
C. Bertil Ohlin A. increasing fixed costs by limiting them
D. Michael Porter to small volumes
51. Which of the following is NOT a key fea- B. serving domestic and international
ture of MNCs? markets from the same production facili-
ties
A. A large amount of assets, including
C. serving only domestic markets
both capital and money
D. bargaining with distributors to drive
B. Access to highly qualified managers
up the product costs
and professionals
C. Limited influence over government de- 56. When visiting another country for busi-
cision making ness, you may need a(n) to help you
communicate in the other language
D. An ability to exploit economies of scale
and lower average costs with expansion A. translator
E. Significant advertising and marketing B. sign-language interpreter
budgets C. local citizen
D. Wakeel
52. Which of the following is true about mis-
sion statements? 57. Religion is an element of the compo-
A. defines a market oriented purpose of nent of the international business environ-
an organization ment.
B. provides direction & amp; inspires in- A. Geographic
dividuals B. Cultural
C. commits resources C. Economic
D. All of the above are true D. Political
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 62
58. All of the following are potential benefits 63. An organization assisted two countries
of entering a new market except on settling a trade disagreement on the
A. eliminating synergy with other opera- amount of bananas to be traded. This
tions action is an example of assistance pro-
vided by which international trade organi-
B. lowering manufacturing costs zation?
C. limiting competitors’ profits A. World Trade Organization
D. gaining new technology B. Free Trade Zones
NARAYAN CHANGDER
59. a risk which results in the decline of a C. Common Markets
company’s economic value from currency D. NAFTA
movements, which causes a loss in com-
petitive strength 64. Organization architecture include the fol-
lowing EXCEPT
A. Risk
A. control systems and incentives
B. Economic Risk
B. organizational culture
C. Exchange Rate Risk
C. market conditions
D. Cred/Sale Risk
D. processes
60. When British Petroleum ships crude oil
65. A product a seller is selling in a different
from its storage facilities in Kuwait to its
country is considered:
Australian subsidiary, has occurred.
A. Import
A. indirect exporting
B. Export
B. direct exporting
C. Trade Barrier
C. an intracorporate transfer
D. None of these
D. an intercorporate transfer
66. A French wind power company gives an
61. What will you learn when socializing with Indonesian company the right to produce
other persons in society in international and sell wind turbines in return for a roy-
business context alty fee on every unit sold. Which busi-
A. social rules, behavioral patterns ness practice is this an example of?
B. personal habits, values A. acquisition
C. Communications B. licensing
D. None of them C. exporting
D. greenfield investment
62. International Business is important for it
provides a source of raw materials and 67. Trade barriers can limit a firm’s ability to
parts and demand for foreign products. disperse production globally in these term,
except
A. TRUE
A. Trade barriers raise the cost of export-
B. FALSE
ing
C. NONE OF THE TWO CHOICES B. Firms may have to locate production
D. none of above activities
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 63
C. Trade barriers raise the firm’s profit C. produce
D. The threat of future trade barriers can D. specialize
PRACTICE BOOK» NOT FOR SALE
influence firm strategy
73. Globalisation is best defined as
68. When people in these countries communi-
cate indirectly and place little value to lit- A. increased international trade as a re-
eral words, they are said to to be sult of free movement of goods and capi-
tal between countries
A. Language differentiators
B. a situation where all of the world uses
B. Face saving the same common currency
C. High-context cultures C. the growing trend for companies to
D. Low-context cultures stop making products within their own
country
69. What is the simplest type of exchange ex-
posure? D. the increase in the world tourist indus-
try leading to more global travel
A. Transaction exposure
B. Translation exposure 74. Boeing collaborated in a strategic alliance
with Fuji, Mitsubishi and Kawasaki in the
C. Economic exposure
development and production of the Boeing
D. none of above 777 to minimize Boeing’s financial expo-
sure. What benefit of strategic alliance
70. What is foreign policy? was Boeing seeking?
A. a country’s relations with other na- A. Easy of market entry
tions
B. Shared risk
B. international trade policy
C. Shared knowledge
C. sending diplomats to global confer-
ences D. Synergy
D. protection of overseas interests 75. Value-added and excise taxes are taxes
71. Which strategy is make sense when the on
firm faces strong pressures for cost reduc- A. The sale of goods
tions and demands for local responsive-
B. Corporate income
ness are minimal?
A. Global standardization strategy C. Payroll
B. Localization strategy D. None of these
C. Transnational strategy 76. A US dollar will “buy” about 1.5 British
D. International strategy pounds. This ratio between the two cur-
rencies is known as:
72. When countries make intensive use of lo-
A. Currency relationship
cally scarce factors, they should that
product. B. Exchange rate
A. import C. Euro connection
B. export D. None of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 64
77. A rule or law that slows or prevents trad- C. Voluntary export restraints
ing with other nations.
D. Administrative policies
A. Trade barrier
B. Import 82. When determining the comparative advan-
tage, one must determine
C. Export
D. International A. Specialization
B. Opportunity cost
78. The procurement of selected value-adding
NARAYAN CHANGDER
activities, including production of interme- C. Absolute Advantage
diate goods or finished products, from in-
D. none of above
dependent suppliers.
A. Outsourcing 83. Four main stages in product life cycle the-
B. Offshoring ory:
C. Imports A. Introduction-Maturity-Decline-Growth
D. Global Sourcing B. Introduction-Growth-Decline-Maturity
79. Toyota and GM created a joint venture C. Introduction-Growth-Maturity-Decline
called NUMMI because Toyota wanted to
learn about how to deal with labor and D. Introduction-Maturity-Growth-Decline
parts suppliers in the U.S. market while
GM wanted to observe Japanese manage- 84. What is one of these choices as practical
ment practices. What benefit of strategic actions to embrace more Corporate Social
alliances were Toyota and GM primarily Responsibility & Sustainability?
seeking? A. Accruing environmental Assets
A. ease of market entry B. Hiring more experienced sustainability
B. shared risk managers
C. shared knowledge C. Build firm’s capabilities to boost com-
D. synergy munity and environment
80. Check all that apply. What are three for- D. None of them
mal trade barriers?
85. When an exchange rate of a currency de-
A. Quotas preciates, the following will be likely to
B. Tariffs happen:1) import prices will fall and ex-
C. Embargoes port prices will rise2) export sales will fall
and import purchases will increase3) ex-
D. Infrastructure port prices will fall and import prices will
81. The demands that some specific fraction rise4) prices of all products will not change
of a good be produced domestically is one A. 1
of the government intervention in interna-
tional trade in the term of B. 2
A. Local content requirements C. 3
B. Subsidies D. 4
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 65
86. Which of the following is an element of the C. A trade agreement between the US,
comparative advantage principle? Canada, and Mexico to reduce trade bar-
riers.
PRACTICE BOOK» NOT FOR SALE
A. per unit cost advantage
D. None of these
B. relative efficiency of production
C. absolute cost of production 91. What can globalization do for busi-
nesses?
D. negative balance of trade
A. Provide fewer choices for consumers
87. A fair price for goods, specifically for de- B. Decrease job opportunities
veloping country producers for better trad-
ing conditions. Some goods it usually in- C. Create new investment opportunities
cludes are crafts, coffee, cocoa, sugar, tea, for people-globally
bananas, honey, cotton, fresh fruit, choco- D. Create miscommunication between na-
late, and flowers. tions
A. International 92. Services are provided to you by other
B. Fair trade A. people
C. Domestic trade B. employees
D. World Trade Organization C. companies
D. countries
88. An import is a
A. Good/service brought into a country 93. Which of the following is not one of the
three steps in increasing market share,
B. Good/service sent to another country
revenue, and profits?
C. Good brought into a country A. Assess alternative markets.
D. none of above B. Evaluate respective costs, benefits,
and risks.
89. A government action that decreases an in-
dustry’s productions costs, which also de- C. Perform a situation analysis.
creases the price of the industry’s goods D. Select market with most potential for
(e.g. Farm subsidies in NE) entry or expansion
A. Domestic trade
94. Which 4 of the following influence interna-
B. Free trade tional business?
C. Market A. geographic conditions
D. Subsidy B. cultural and social factors
C. political and legal factors
90. NAFTA is (You learned this in history):
D. economic conditions
A. A trade agreement between the US
and Canada to work more closely with E. trade partners
Western Europe. 95. How can the beliefs, behaviors, objects,
B. A trade agreement between the US and other characteristics common to mem-
and Mexico designed to break US trade bers of a particular group or society BEST
unions. be described?
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 66
A. language C. remain current on the latest business
B. traditions methods
C. culture D. remain current on the latest communi-
cation method
D. habbits
101. refers to a world economy with
96. This is a brain hacking question, what is movement of products and labor across in-
your name of the lecturer of international ternational borders.
management?
NARAYAN CHANGDER
A. International business
A. Phuong Linh, Nguyen
B. Global economy
B. Nguyen Thi Phuong Linh
C. Domestic business
C. Nguyen Thi Huong Linh D. none of above
D. Nguyen Phuong Lien
102. When traveling to Saudi Arabia, you need
97. The key effects on a country’s level of eco- a to enter the country.
nomic development are A. Travel agent
A. literacy level. B. Wakeel
B. technology. C. Travel guide
C. agricultural dependency. D. Interpretor
D. religion.
103. A belief that products should be free to
98. a risk of politically motivated interference move from country to country without bar-
of a foreign government riers or obstacles.
A. High Dependency Risk A. Quota
B. Political Risk B. Entrepreneur
C. Credit Risk C. Free trade
D. Legal Risk D. Translate
99. Which is NOT a trade remedy under the 104. If the United States hosts a six-month-
WTO? long World’s Fair and it attracts over a
million tourists from other countries, the
A. Countervailing Duties revenue from this World’s Fair would be
B. Antidumping Duties included in its:
C. The Buy American Act A. balance of trade
D. Safeguard measures B. balance of payments
C. GDP
100. Individuals should most likely study inter-
national business to D. none of above
A. comply with graduate school certifica- 105. Which theory listed below is useful in de-
tion requirements ciding which mode of entry to use when
B. ensure that an employer has a global entering foreign markets?
online presence A. ownership advantage theory
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 67
B. internalization theory England, and China. Which of the follow-
C. eclectic theory ing is Ford’s home country?
PRACTICE BOOK» NOT FOR SALE
A. Germany
D. relative factor endowments
B. England
106. The definition of the exchange rate of a
C. China
currency is:1) the price level in the coun-
try2) the rate at which imports can be D. United States
bought from export revenue3) the price
111. The strategic alliance between Kodak,
of one currency in terms of how much it
Fuji, and three Japanese camera firms was
buys of another4) the price of a currency
primarily developed to
in terms of the goods that can be bought
with it A. increase Kodak’s profits
A. 1 B. avoid government takeover
B. 2 C. reduce Kodak’s risks
C. 3 D. protect intellectual property
D. 4 112. The idea that you can carry your beliefs,
values, and assumptions with you at all
107. This strategy makes sense when there times is referred to
are substantial differences across nations
A. Culture
with regard to consumer tastes and pref-
erences and cost pressures are not too in- B. Subculture
tense. C. Cultural Baggage
A. global standardization strategy D. Contexting
B. localisation strategy
113. One potential disadvantage for a country
C. transnational strategy of encouraging a multinational business to
D. international strategy setup is that:1) jobs might be lost in ex-
isting national businesses2) tax revenue
108. The sustainable firm does not pursue to the government will fall3) these compa-
nies never export any products from the
A. Economic interests
countries they operate in4) costs of pro-
B. Social interests duction are likely to be high and this will
C. Personal interests raise prices
D. Illegal interests A. 1
B. 2
109. A tax on a good imported into a country.
C. 3
A. Tarriff
D. 4
B. Translate
114. It involves pulling of resources among
C. Negotiate
foreign and local coinventors to operate
D. Embargo the business.
110. Ford Motor Company is based in Detroit, A. Strategic Alliance
Michigan. It also has offices in Germany, B. joint ventures
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 68
C. franchising C. It is a system of values and norms that
D. none of above are shared among a group of people
D. It involves the knowledge and beliefs
115. What are the costs of globalization? of people
A. Threats to national sovereignty
120. Uneven distribution of natural resources
B. Economic growth and environmental
stress A. is the only cause for international busi-
ness.
NARAYAN CHANGDER
C. All of these
B. is the major factor for international
D. Growing income inequality and per-
business.
sonal stress
C. is among the major factors for interna-
116. A firm benefits by basing each value cre- tional business.
ation activity it performs at that location-
where economic, political, and cultural con- D. is not a cause for international busi-
ditions, including relative factor costs, are ness.
most conducive to the performance of that
121. What is classical theory?
activity. Firms that pursue such astrategy
can realize: A. It is from the perspective of a country.
A. differentiation. B. It is from the perspective of a firm.
B. location economies. C. Both A and B
C. vertical integration. D. none of above
D. horizontal integration
122. A definition of a multinational business
117. is the making, buying and selling of is one that:1) has a foreign sounding
products within a country. name2) imports goods from one country
and exports them to another one3) ex-
A. International business
ports goods to many different countries4)
B. Global economy has factories or operations in more than
C. Domestic business one country
D. none of above A. 1
B. 2
118. The US exports the most products to this
country: C. 3
A. China D. 4
B. Japan
123. Why do companies decide to be multina-
C. Canada tional
D. England A. Entering a new country gives the busi-
ness a new market
119. Which of the following is not true regard-
ing culture? B. To reduce production costs
A. Culture is static C. Gain trade barriers
B. Culture is evolving D. To completely avoid tax liability
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 69
124. A society’s culture has a strong influence 129. One possible opportunity for a business
on business activities. Which of these is as a consequence of globalisation is:1)
an example of a cultural influence? able to buy a wider range of imported ma-
PRACTICE BOOK» NOT FOR SALE
terials and products2) more likely to be
A. climate
able to create a monopoly3) able to in-
B. natural resources crease prices as there will be less competi-
C. religion tion4) able to sell products successfully in
all foreign markets without changing the
D. inflation products
125. Goods and services sold to other coun- A. 1
tries are called B. 2
A. exports C. 3
B. tariffs D. 4
C. imports
130. A special right given to a business person
D. contraband to sell a company’s products. (e.g. Sub-
way, Jimmy Johns, Sonic)
126. The European Union is an example of
A. Subsidy
A. Monetary union
B. Franchise
B. Free trade area
C. Quota
C. Common market
D. Ethics
D. Economic union
131. Which of the following would be an ex-
127. Which of the following is less likely to ample of international business?
add to the pressure for a firm to be locally
responsive? A. A farmers in Iowa using equipment
made in Indiana.
A. Host-government demands
B. A sales staff in South Carolina repre-
B. Switching costs for consumers senting a foreign producer.
C. Differences in infrastructure and tradi- C. A restaurant in Chicago offering Asian
tional practices menu items.
D. National differences in consumer D. When a country’s imports exceed its
tastes and preferences exports, there is a trade.
128. A US company can obtain political risk in- 132. What is it called when business trans-
surance on an overseas subsidiary or in- actions take place between two or more
vestment from countries outside their political bound-
A. The US Dept of Agriculture aries?
B. The US Dept. of Commerce A. Local Business
C. The Overseas Private Investment Cor- B. International Dominance
poration C. International Corruption
D. Free-trade agreements D. International Business
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 70
133. Benefits of international business is A. German
A. more job employment B. Spanish
B. all of these C. French
C. increase FDI D. Bahasa Indonesian
D. variety of goods & services available 139. The negotiating team should not be too
134. A company that would like to build a large, it should not exceed ( ).
NARAYAN CHANGDER
golf course that could be played year A. 4
round would need to consider which com- B. 5
ponent of the international business envi-
ronment? C. 6
A. Environmental D. none of above
B. Social 140. Education, occupation, and income are fac-
tors that may determine
C. Economic
A. Mobilty
D. Political
B. Gender roles
135. planning is the process of determin-
C. Class level
ing how to move to a desired future state
D. None of the above
A. Strategic
B. Tactical 141. Some words that are similar (synonyms)
include global, world, worldwide, and for-
C. Reactive
eign.
D. Proactive
A. Culture
136. In a SWOT analysis what evaluates B. Translate
the external factors that the environment
C. International
brings to a business?
D. Business
A. Opportunities
B. Threats 142. The definition of the exchange rate of a
currency is:
C. Strengths and weaknesses
A. the price level in the country
D. Opportunities and threats
B. the rate at which imports can be
137. A good or service sold to another coun- bought from export revenue
try. C. the price of one currency in terms of
A. Import how much it buys of another
B. Export D. the price of a currency in terms of the
C. Ethics goods that can be bought with it
D. Translate 143. is the belief in the superiority of one’s
own ethnic group or culture.
138. A language that is not considered a ma-
jor language for international business pur- A. Power distance
poses is B. Ethnocentrism
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 71
C. Individualism C. trade barrier
D. Dynamism D. none of above
PRACTICE BOOK» NOT FOR SALE
144. The rate at which prices for goods and 149. The relocation of a business process or
services is rising and therefore the pur- entire manufacturing facility to a foreign
chasing power of the currency is falling is country.
A. Exports
A. Interest B. Global Sourcing
B. Unfair C. outsourcing
C. Inflation D. Offshoring
D. Appreciation
150. India limits the amount of imported
145. Social welfare issues and an example of wheat products to protect its own indus-
try. This is an example of which interna-
A. trade drawbacks
tional trade barrier?
B. governmental policy
A. Quota
C. political issues
B. Embargo
D. lower standards of living C. Tariff
146. Some negative side effects of trade be- D. none of above
tween low income and high income coun-
tries are: 151. WTO stands for
A. Environmental degradation A. World Time Organization
B. Lower prices B. World Technology Outcomes
C. Bad working conditions including poor C. World Trade Organization
protection in the work environment D. World Tourism Organization
D. Bad quality items 152. According to Porter’s competitive advan-
tage of nations, refer to the nature of
147. Set of moral principles by which people
home-market demand for specific products
conduct themselves, personally and pro-
and services.
fessionally.
A. firm strategy, structure, and rivalry
A. E-tailing
B. factor conditions
B. Stakeholding
C. demand conditions
C. Bribery
D. demand liabilities
D. Ethics
153. The following are the forces driving glob-
148. In 2019, Costa Rica sold over 120 mil-
alization EXCEPT
lion boxes of bananas to different mar-
kets, such as the European Union and the A. increase in and application of technol-
United States. How would these bananas ogy
be characterized in Costa Rica? B. growth of consumer pressures
A. imports C. increased global competition
B. exports D. people behaviour
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 72
154. What is the first step in selecting a for- 159. A person living in Canada buys a product
eign market? made in Germany. Example of:
A. assessing market potential A. Domestic Business
B. monitoring major markets B. International Business
C. evaluating host country’s trade poli- C. Home Country
cies D. Host Country
D. assessing general legal and political
NARAYAN CHANGDER
environments 160. Members do away with duties and other
trade barriers-they allow companies to in-
155. When the value of export is greater than vest freely in each member’s country *ex.
the value of import, it is called ? EU (European Union)
A. Trade surplus A. Free-trade zones
B. Trade deficit B. Free-trade agreements
C. Protectionism C. non-tariff alliances
D. none of above D. Common markets
156. A multinational corporation operates in a 161. A particular number that an export firm
businesss environment. needs to have is known as-
A. complex A. IEC Number
B. difficult B. IFC Number
C. basic C. IIC Number
D. none of above D. IFC Code
162. The situation where a government does
157. Of the following business transactions,
not attempt to restrict what its citizen can
the only one the describes an importing ac-
buy form another country or what they can
tivity is
sell to another country
A. a wholesaler in Brazil packs goods for
A. Free Trade Agreement
ship to Liberia
B. Free Trade
B. a retailer in Sweden receives goods
from Mexico to sell in a chain of stores C. International trade
C. a restaurant food supplier in Japan D. Regional trade
ships sushi ingredients to a restaurant in
163. A place where trade occurs.
Turkey
A. Import
D. None of the answers
B. Export
158. What is an advantage of centralization?
C. Resource
A. Inflexibility
D. Market
B. Improved Morale
164. is any activities needed to create,
C. Demotivating ship, and sell products across national bor-
D. Efficiency ders.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 73
A. International business 169. Protectionist trade policies
B. Global economy A. Cause an appreciation of the domestic
PRACTICE BOOK» NOT FOR SALE
currency
C. Domestic business
B. Cause a decrease in the volume of
D. none of above trade
165. The difference between the amount of C. Reduce trade deficit
money that comes into a country and the D. Reduce taxes
amount that goes out is called the
170. Which of the following is NOT a cul-
A. balance of payments tural/social factor that affects interna-
B. balance of trade tional business?
C. foreign debt A. language
B. religion
D. all of these
C. values
166. Porter’s five forces model focuses on the D. climate
bargaining power
171. In order to limit the amount of foreign
A. Buyer
competition and allow U.S. peanut grow-
B. Industry ers to charge more for their crops, the
C. Suppliers United States limits the amount of peanuts
that can be imported each year to 1.7 mil-
D. none of above lion pounds. What type of trade barrier
does this illustrate?
167. Multinational corporations must adhere
A. import tax
to the laws of which country (check all that
apply) B. quota
A. Home country (country in which the C. embargo
business is incorporated D. licensing
B. Host country (country in which the 172. “The goods were not loaded on the ship
business is conducted) as they did not get the custom clearance
C. Switzerland-where the world trade or- due to lack of one of the main docu-
ganization sets rules ment. “Identify the document which was
required among the following:-
D. None of the above
A. Bill of clearance
168. Investment into a country such as the UK B. Custom bill
from companies abroad is an example of
C. Shipping bill
what?
D. Bill of exchange
A. Greenfield FDI
B. Outward foreign direct investment 173. Which of the following was formed for
looking after the promotion of free and
C. Inward foreign direct investment fair trade among nations?
D. Brownfield FDI A. International Monetary Fund
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 74
B. World Bank C. To speed up industrialisation.
C. World Trade Organisation D. To earn foreign exchange.
D. General Agreement for Tariffs and
179. The most likely reason why some govern-
Trade
ments impose tariffs on imported goods
174. All of the following are standard ap- is:1) to reduce the rate of inflation2) to in-
proaches to strategic alliance management crease employment in foreign countries3)
EXCEPT to reduce the Balance of Payments4) to in-
NARAYAN CHANGDER
crease output in their own countries
A. shared management agreements
A. 1
B. assigned arrangements
B. 2
C. delegated arrangements
C. 3
D. consensual arrangements
D. 4
175. Profit growth can be achieved through
180. the money a country owes another coun-
try
A. increase cost
B. decrease cost A. GDP
C. add value and raise prices B. Foreign Debt
D. enter new markets C. Franchise
D. Legal Risk
176. The United States conducts trade with
more than countries. 181. Which strategy is the most suitable for
A. 10 the firm that face both high cost pressures
and high pressures for local responsive-
B. 50 ness
C. 100
A. Global standardization
D. 180
B. Localization
177. strategy is most appropriate when C. Transnational
there are substantial differences acrossna-
D. International
tions with regard to consumer tastes and
preferences, and where cost pressuresare 182. A global dependency exists when
not too intense.
A. massive crop failures require buying
A. Localization food from another country
B. Transnational B. a country buys tools from another
C. Global standardization country because it does not have the tech-
D. International nology to make the tools
C. doctors travel to another country to
178. Which of the following is not the objec- provide healthcare because there is a
tives of import trade? shortage of medically-trained profession-
A. To meet consumer demand. als in that country
B. To improve the standard of living. D. all of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 75
183. A good is a product that you can see 188. Free international trade’ means that:
and touch. A. goods can be transported between
PRACTICE BOOK» NOT FOR SALE
A. imitation countries free of charge for ever
B. physical B. all countries use the same currency so
C. imaginary it does not cost anything to convert cur-
rencies
D. spiritual
C. there are no tariffs or quotas to limit
184. A statement that explains what a com- trade between countries
pany or group believes is proper and im-
D. businesses can produce in any country
proper conduct.
without any legal controls
A. E-tailing
189. An agreement between two nations.
B. Code of Ethics
A. Trade barrier
C. Code of Engagement
B. Franchise
D. Stakeholder’s code
C. Bilateral agreement
185. Gameware recently entered the Ger-
D. Multilateral agreement
man market. Gameware executives also
wanted to enter the Canadian market but 190. When an exchange rate of a currency de-
had to delay the entry because of limited preciate s, the following will be likely to
resources. What type of costs will Game- happen:
ware incur as a result of being unable to
enter the Canadian market? A. import prices will fall and export prices
will rise
A. indirect costs
B. export sales will fall and import pur-
B. direct costs chases will increase
C. opportunity costs C. export prices will fall and import prices
D. variable costs will rise
186. The two basic strategies for creating D. prices of all products will not change
value are
191. Some U.S. customs are considered disre-
A. value and cost spectful or inappropriate in other cultures.
B. differentiation and low cost When visiting another country, which coun-
tries customs should you respect?
C. profitability and profit growth
A. U.S. customs
D. R & D and production
B. The country you are visiting
187. In a economy certain sectors of the
C. Neither country
economy are left to private ownership and
free market mechanisms. D. none of above
A. Mixed 192. Underdeveloped nations tend to trade
B. Market what type of goods?
C. Planned A. Low skill products
D. Common B. High tech goods
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 76
C. finished products C. Deforestation
D. High skill products D. You lose your income
193. Country will produce only ONE product 198. A ban on trade with another country for
that it has absolute advantage. This refers one or all of its goods.
to:
A. Embargo
A. Absolute advantage
B. Free trade
B. Comparative advantage
NARAYAN CHANGDER
C. Market
C. Efficiency
D. Tariff
D. Specialization
194. The concept that all countries depend on 199. A(n) statement defines the purpose
each other of an organization.
A. Individualism A. Vision
B. Global dependence B. Mission
C. International Business C. Strategic
D. Inter-relational business D. Goal
195. Governments privatize their state- 200. Country risk is considered similar to
owned companies to
A. political risk
A. Provide tax incentives to their export-
ing companies B. commercial risk
B. Make these companies more efficient C. currency risk
and profitable D. cross-cultural risk
C. Create free-trade agreements
201. A situation in which a country specializes
D. Establish foreign-trade zones in the production of a good or service at
which it is relatively more efficient?
196. Form of licensing whereby a company
grants another firm the rights to use A. Absolute advantage
the former’s brand name and operating
B. Concerning advantage
method
C. Comparative advantage
A. Franchising
D. Available advantage
B. Exporting
C. Licensing 202. Absolute restriction on the import of cer-
D. none of above tain products from certain countries is
called
197. What is the one bad effect of social glob- A. Quota
alization?
B. Trade Embargo
A. You get a strong bond with other cul-
tures C. Protectionism
B. Loss of Local Culture D. Boycott
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 77
203. Disadvantages of MNC 208. A business that has direct investments
(in the form of marketing or manufacturing
A. Loss market share if they expand too
subsidiaries) abroad in several countries is
PRACTICE BOOK» NOT FOR SALE
quickly
called a
B. Push out small local businesses
A. shell corporation
C. Too little profit by giving away too
much promotions B. multinational corporation
D. none of above C. domestic corporation
D. shell corporation
204. Which of the following is a driver of glob-
alization? 209. If a country has improving educational
A. greater emphasis on proactive interna- systems, increasing technology and ex-
tionalization panding industries, that country is consid-
ered to be:
B. internationalization of firm’s value
chain A. Developing
C. integration of world financial markets B. Industrialized
D. globalization of services C. Less-Developed
D. none of above
205. In Heckscher-Ohlin theory, factor endow-
ments normally refers to , and
210. Define what is ethical behavior?
A. land
A. it is a good attitude
B. money
B. it is simply the right thing to do
C. labor
C. Both of them
D. capital
D. None above
206. It is a popular entry strategy for compa-
nies venturing abroad for the first time: 211. is the trend toward greater eco-
nomic, cultural, political, and technologi-
A. Import cal interdependence among national insti-
B. Export tutions and economies.
C. Invest A. Globalization
D. Income B. Privatization
C. Decentralization
207. A political system in which one political
party holds all the power and prohibits D. Heterogenization
members of other parties from participat-
ing is a 212. A place where stocks are bought and sold
A. Democracy A. stock market
B. Totalitarian B. Overseas
C. Exclusive system C. Can’t think
D. None of these D. Fred Meyers
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 78
213. Which of the following NOT example of produce using fewer resources than an-
international company? other country.
A. Alex Minishop A. absolute advantage principle
B. IBM B. comparative advantage principle
C. Google C. factor proportions theory
D. international product cycle theory
D. Nestle
219. Stopping the export and import of a prod-
NARAYAN CHANGDER
214. . A Customer Service Representative uct is known as?
is a product created by what type of re-
source? A. Tariff
B. Embargo
A. Capital
C. Quota
B. Land
D. Deal
C. Labor
220. Which of the following is a common activ-
D. none of above
ity of MNCs?
215. Treaty that allows free trade among ma- A. training of international managers
jor North American countries B. buying resources in various countries
A. NAFTA C. inventing goods in a variety of coun-
B. NATO tries
C. UN D. establishing foreign exchange rates
D. WTO 221. What are the third parties that specialize
in facilitating imports and exports called?
216. is a strategy where a firm uses A. wholesalers
the same product and marketing strategy
worldwide 1.Ex. Apple B. intermediaries
C. exporters
A. A global strategy
D. distributors
B. A marketing strategy
C. A buying strategy 222. Porter’s five forces model focused on ri-
valry among existing firms
D. A multinational strategy
A. Suppliers
217. What should you learn and use? B. Industry competitors
A. Nothing C. substitute
B. a few words in your business D. none of above
prospect’s native tongue
223. How many types of international busi-
C. No ness’s strategies?
D. Everything A. 4
B. 5
218. According to the , a country benefits
by producing only those products in which C. 6
it has complete advantage or that it can D. 7
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 79
224. The government takeover of a foreign- 229. The kind of trade that is limited geo-
owned business is called graphically within a country. It involves
commercial exchanges that are only done
PRACTICE BOOK» NOT FOR SALE
A. Expropriation
within that country.
B. Protectionism
A. DOMESTIC BUSINESS
C. Political Status
B. INTERNATIONAL BUSINESS
D. Boycott
C. GLOBAL DEPENDENCY
225. Allow workers to move freely across bor- D. none of above
ders
230. The rewards of globalization are all ex-
A. Free-trade zones cept for the following:
B. Free-trade agreements A. access to a large customer base
C. Common markets B. investment losses
D. none of above C. increased profitability
226. refusing to buy, sell or use certain groups D. increased profit growth
A. rebellion 231. One possible opportunity for a business
B. boycott as a consequence of globalisation is:
A. able to sell products successfully in
C. tax
all foreign markets without changing the
D. rebellion products
227. is a contractual arrangement in which B. able to increase prices as there will be
a firm in one country allows the use of its less competition
intellectual property by a firm in a second C. more likely to be able to create a
country in return for a royalty payment. monopoly
A. Leasing D. able to buy a wider range of imported
B. Franchising materials and products
C. Licensing 232. A direct restriction on the quantity of
some good that may be imported into a
D. Merchandising
country
228. what is the meaning of ethics? A. Import quota
A. Moral habits that govern the behavior B. Tariff rate quota
of society C. Voluntary export restraint
B. Legal moral principles and values that D. Quota rent
govern the behavior of people, firms, and
governments, regarding right and wrong 233. All business activities needed to create,
C. Moral principles and values that gov- ship, and sell goods and services across na-
ern the behavior of people, firms, and gov- tional borders are considered to be
ernments, regarding right and wrong A. domestic business
D. None of them B. international business
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 80
C. global dependency B. Location advantages
D. none of these C. Internalization advantages
234. A(n) is one in which prices do not re- D. Competitive advantages
flect all available information.
239. What are the two benefits of specialisa-
A. inefficient market tion?
B. speculative market A. Increased productivity and output
NARAYAN CHANGDER
C. efficient market B. Organic growth
D. externally convertible market C. Economic growth
235. Which of the following is one of the two D. Expansion
types of competitive pressure that affects
240. The integration of markets, nation-
the ability of multinational enterprises to
states, and technologies in a way that
compete in the global marketplace?
is enabling individuals, corporations, and
A. pressure for price increases nation-states to reach around the world
B. pressure for local responsiveness farther, faster, deeper, and cheaper than
ever before is referred to as
C. pressure for value creation
A. international business organization
D. pressure for increased profitable
B. market internationalization
236. There are a limited number of car manu-
facturers in the United States due to the C. economic integration
capital requirements involved in producing D. globalization
automobiles. What type of competitive
situation would this be characterized as? 241. It involves selling locally made products
in foreign countries,
A. oligopoly
A. Importing
B. pure competition
B. barter
C. monopoly
C. exporting
D. monarchy
D. none of above
237. Which of the following scenarios is likely
to cause the value of a country’s currency 242. The most likely reason why some govern-
to rise? ments impose tariffs on imported goods is:
A. prolonged inflation A. to reduce the rate of inflation
B. sudden change in government B. to increase employment in foreign
countries
C. increased demand for the nation’s
products and currency C. to reduce the Balance of Payments
D. higher interest rates D. to increase output in their own coun-
tries
238. are tangible or intangible resources
owned by a firm which grant it a competi- 243. Why companies engage in international
tive advantage over its industry rivals. business?
A. Ownership advantages A. To expand sales
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 81
B. To acquire resources B. building a plant in a foreign country to
C. To diversify or reduce risks capitalize on lower labor costs
PRACTICE BOOK» NOT FOR SALE
C. borrowing money from a major bank to
D. all of these
finance capital improvements
244. In recent years, business executives and D. shipping finished products from one
scholars have used to refer to the ad- country to another for retail sale
vantages possessed by nations and indi-
vidual firms in international trade and in- 249. This trade agreement involves Canada,
vestment USA and Mexico.
A. comparative advantage A. NAFTA
B. CUSMA
B. country-specific advantage
C. MERCOSUR
C. competitive advantage
D. FTAA
D. cost advantage
250. The free trade agreement in Southeast
245. A country being able to make a product Asia (ASEAN) is
or service at a lower cost than other coun-
A. NAFTA
tries is considered?
B. DR-CAFTA
A. Absolute advantage
C. AFTA
B. Concerning advantage
D. EPA
C. Comparative advantage
251. What are tariffs?
D. Available advantage
A. political boundaries between nations
246. A country in which a multinational com- B. military blockades of specific coun-
pany conducts business activities is called tries
the
C. disputes between state governments
A. home country over boundaries
B. host country D. taxes on the import or export of goods
C. economic community from a country
D. free trade zone 252. Which organizational structure(s) is/are
decentralized?
247. The devices used to reward appropriate
A. Functional structure
managerial behavior is known as
B. International divisional structure
A. processes
C. Holding company structure
B. people
D. B & C
C. culture
253. what is absolute advantage?
D. incentives
A. the ability of a country to produce
248. Which of the following is not an interna- more products (more efficiently) than
tional business transaction? other countries
A. purchasing products in one country B. the ability to trade goods and services
and assembling them in another quicker
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 82
C. the ability to trade products that are C. there will be less choice and variety for
more durable than other countries their consumers
D. the ability to trade products outside of D. they will tend to produce on a small
one’s border scale and this will raise costs
254. Which 3 of the following are exports?
259. A company is worried that about ex-
A. US cars sold in Europe
change rate would need to consider which
B. Nebraska beef sold in Japan component of the international business
NARAYAN CHANGDER
C. Brazillian bananas sold in Canada environment?
D. Saudi Arabian oil sold in the US A. Political
255. This is a question of encouragement, try B. Environmental
to come to an end. What color is the black
C. Economic
cow?
A. Yellow D. Social
B. Dairy cows are white and black
260. The British term for the trading of tangi-
C. Black ble goods is
D. Vietnamese beef will usually be brown-
A. visible trade
ish yellow
B. invisible trade
256. The NFL allows your company to sell
products that have sports team emblems C. merchandising
on apparel in your store for a fee. This is
an example of which global marketplace D. service franchising
main entry mode?
261. The value of a currency in one country
A. Licensing Agreement
compared with the value of another is
B. Franchise called the
C. Joint Venture A. balance of payments
D. none of above
B. exchange rate
257. The concept of face translates roughly to
C. inflation rate
A. how someone looks
D. currency
B. duty, sincerity, and loyalty
C. honesty, ethics, and morals 262. A summary of an economy’s transaction
D. honor, good reputation, or respect with the rest of the world for a specified
period of time.
258. One possible disadvantage to businesses
of globalisation is that: A. Summary
A. all products will become more expen- B. Balance of Trade
sive
C. Statement
B. there will be more international com-
petition D. Balance of Payments
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 83
263. Executives at Bantam Bicycles realize B. India
that the firm lacks the necessary inter- C. Japan
nal resources to compete internationally.
PRACTICE BOOK» NOT FOR SALE
Which of the following would most likely D. Vietnam
enable Bantam to compete in the global 268. What is the account name of IPMI’s Tik-
market? Tok?
A. exporting to emerging economies A. ipmi.ac.id
B. investing in a financial portfolio B. ipmi.bachelor
C. forming a strategic alliance C. ipmi.master
D. opening a retail store D. ipmi.youngster
264. To make products by hand or machinery. 269. The difference between a country’s total
A. Resource exports and total imports is called the
A. foreign debt
B. Manufacture
B. balance of trade
C. Translate
C. trade surplus
D. Embargo
D. trade deficit
265. Syria is banned from selling products
within other countries. This is an example 270. A is a limit that a government places
of which international trade barrier? on the quantity of a product that may be
exported or imported during a given pe-
A. Tariff riod.
B. Embargo A. quota
C. Quota B. embargo
D. none of above C. tariff
266. Of the following characteristics, the one D. divestiture.
that is not typical of a democratic system 271. A is a limit of how much of a prod-
is that uct can be brought into a country during a
A. Individuals have the freedom to own specific time.
and operate private businesses. A. quota
B. Individuals can build a small business B. tariff
into a very large business
C. law
C. The economy is usually a command
D. none of above
economy
D. Individuals may travel freely to other 272. When two countries agree to eliminate
countries duties and trade barriers on products
traded between them, they have
267. An investor wants to invest in a coun-
A. Free-trade zones
try that has a high gross national income
(GNI). Which of the following countries B. Most favored nation status
would most likely qualify as a prospect? C. A free trade agreement
A. Nepal D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 84
273. is a strategy where firms develop A. It provides guidance in financial plan-
products and marketing strategies that ning.
adapt to the customs, tastes, and buy- B. It assists in acquiring funds from dif-
ing habits of a distinct national market- ferent sources.
Ex.McDonald’s
C. It cut down financial costs.
A. A global strategy
D. All of the above.
B. A marketing strategy
278. Which one of the following modes of en-
NARAYAN CHANGDER
C. A buying strategy
try permits greatest degree of control over
D. A multinational strategy overseas operations?
274. If the United States placed a trade em- A. Licensing/franchising
bargo on a foreign country B. Wholly owned subsidiary
A. Quotas would be placed on all goods C. Contract manufacturing
entering the US D. Joint venture
B. No products could be traded between
the US and the foreign country 279. Individuals or groups who have a di-
rect interest, involvement or investment in
C. All businesses owned by the foreign something.
government in the US would be privatized
A. E-tailing employees
D. The US would have granted most fa-
vored nation status to this foreign country B. Coded people
C. Engaged employees
275. When an exchange rate of a currency de-
D. Stakeholders
preciates it means that:
A. one unit of it buys more of a foreign 280. Flowers should be given in uneven num-
currency than before bers and unwrapped in
B. the price level in that country has A. Korea
fallen B. Germany
C. one unit of it buys less of a foreign cur- C. New Zealand
rency than before
D. China
D. the country’s exports will become
more expensive 281. A product you buy from another country
is considered
276. A control on the amount of a product that A. export
can be imported into a country.
B. import
A. Quota
C. trade barrier
B. International
D. none of these
C. Negotiate
282. If a country trades with other countries
D. Free trade
because it has more than it needs of a cer-
277. Which is the importance of international tain product, the trade reason is:
financial management? A. Political/Historical
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 85
B. Specialization B. imports goods from one country and
C. Increased competition exports them to another one
PRACTICE BOOK» NOT FOR SALE
D. Surplus C. exports goods to many different coun-
tries
283. An exchange of goods or services with D. has factories or operations in more
people and businesses in your own coun- than one country
try.
288. An export can be defined as any product
A. Bilateral agreement
that is:
B. Resource
A. made from goods bought from another
C. Domestic trade country
D. International trade B. sold to another country
284. To ensure understanding while doing in- C. bought from another country
ternational business, a company could en- D. made in another country
gage the services of a
289. Which of the following counties has an
A. translator absolute advantage in coffee production?
B. puppy A. the United States
C. baseball team B. Saudi Arabia
D. cultural ambassador C. Brazil
285. One advantage to the business of becom- D. Ireland
ing a multinational is that:
290. What is not a factor of the Differentiation
A. it will be able to produce goods closer Strategy?
to each country’s market
A. Brand Image
B. it will have fewer factories and operat-
B. Low cost labour
ing bases
C. Service
C. communication will be easier within
the business D. Quality and durability
D. it will tend to produce the same basic 291. Australia’s top company revenue earner
product for markets throughout the world in 2015 was
286. involves producing goods at home A. Woolworths
and then shipping them to the receiving B. Wesfarmers
country for sale. C. Westpac
A. Importing D. Walmart
B. licensing
292. A code of conduct that helps determine
C. Exporting what is good, right and proper.
D. FDI A. Ethics
287. A definition of a multinational business is B. Depreciate
one that: C. Consumer
A. has a foreign sounding name D. Curency
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 86
293. When implementing strategic planning C. Common Market
process, a company’s first step would be D. Duty
A. To conduct a SWOT analysis
299. A system in which your birth may deter-
B. To develop the strategic plan mine your future life
C. To specify action plans A. Caste
D. To develop a mission statement B. Insurance
C. Cultural
NARAYAN CHANGDER
294. A country that lacks ability to logistically
transport imports & exports would be con- D. religion
cerned with which component of the inter-
national business environment? 300. The WTO’s focus concerned with the high
level of tariffs and subsidies in the agricul-
A. Social tural sector of many economies is WTO’s
B. Environmental currently focusing on
C. Political A. Anti-dumping policies
D. Economic B. Market access
C. Protecting in agriculture
295. Involves buying foreign-made products
and selling them in local markets D. Protecting intellectual property
A. Exporting 301. Which mode of transport in a logistic man-
agement is more profitable?
B. Importing
A. Air Transport
C. Bargaining
B. Maritime Transport
D. none of above
C. Land Transport
296. Which of the following would character- D. All of the above
ize a nation with high degree of economic
freedom? 302. Which of the following is not a hurdle
A. low tariffs firms can overcome by participating in a
strategic alliance?
B. strict trade policies
A. avoiding hostile government regula-
C. government interventions tions
D. flourishing black markets B. achieving economies of scale
297. Why was Buy American initially passed? C. minimizing import tariffs
A. To force people to pay a lot of money. D. controlling risk
B. To establish an export system. 303. Which agency was established to lend
money to the governments of troubled
C. To stimulate foreign relationships.
states?
D. To stimulate domestic economy.
A. GATT
298. A tax on imported products B. IMF
A. Quota C. WTO
B. Trade Embargo D. FDI
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 87
304. The difference between import tariffs 309. The smallest unit around which a busi-
and quotas is: ness develops a strategy is called a
PRACTICE BOOK» NOT FOR SALE
A. tariffs are a tax on locally produced A. Strategic business unit
goods but quotas limit the quantity of im-
ports B. Joint venture unit
B. tariffs are a tax on imports and quotas C. Small business unit
are a tax on exports
C. tariffs are a tax on imports and quotas D. Subsidiary unit
limit the quantity of imports
D. tariffs are a tax on all products but quo- 310. Micron Technology, Intel, Samsung,
tas just limit the quantity of imports Hyundai, and Siemens have formed an
alliance to develop the next generation of
305. Country’s wealth was determined by the DRAM chips. What type of alliance is this
amount of its gold and silver holdings. an example of?
A. trade surplus
A. production
B. mercantilism
C. absolute advantage B. marketing
D. competitive advantage C. financial
306. Select example of Indian Multinational D. research and development
Company
A. Hindustan Unilever 311. Something of value that can be useful
B. Videocon (natural, human, capital.)
C. Cargill A. Culture
D. Tesco
B. Resource
307. The following is the component of sup-
port activities EXCEPT C. Quota
A. Information system D. Export
B. Human resources
C. Logistics 312. The following are the important to study
international business
D. R & D
A. most companies are either interna-
308. For the following situations, which are
tional or compete with international com-
examples of a formal trade barrier.
panies
A. Law requiring that stores be closed on
Sundays. B. global events and competition affect
almost all companies, regardless of indus-
B. Special tax on the sale of books.
try
C. Required nutritional information on
food packaging. C. understanding of IB helps you make
D. A and B only better career decisions
E. All of the above D. All of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 88
313. In a economy, certain sectors of the 318. They developed the Factor proportions
economy are left to private ownership and Theory.
free market mechanisms while other sec-
A. Heckcher and Ohlin
tors have significant state ownership and
government planning. B. Heckscher and Olhin
A. market C. Heckcher and Olin
B. private D. Heckscher and Ohlin
NARAYAN CHANGDER
C. command 319. A subsidy is a government payment
D. mixed made:
314. A person who starts his or her own busi- A. to a domestic producer
ness in hope of earning a profit. B. to a domestic importer
A. Consumer C. to a foreign exporter
B. Currency D. to a foreign producer
C. Manufacture
320. WHAT ARE THE FACTORS WHERE DO-
D. Entrepreneur MESTIC Business AND INTERNATIONAL
BUSINESS DIFFER?
315. Identify the first step in the export
procedure- A. CONSUMER
A. Receipt of enquiry B. FREE TRADE
B. export licence C. CURRENCY
C. intent D. PRODUCT AND PACKAGING
D. production of goods 321. When a group of countries join together
316. What is it called when the government to eliminate duties and other trade barri-
of a nation places a restriction on the im- ers, allow companies to invest freely in
port of certain products from certain coun- each other’s country, and allow workers
tries? to move freely across borders, what has
been established?
A. boycott
A. most favored nation status
B. trade embargo
B. free trade agreement
C. tarriff
C. free trade zone
D. exappropriation
D. a common market
317. Which of the following decisions is typ-
ically centralized at a firm’s headquar- 322. Australia’s top two way trading partner
ters? is as of 2014
A. Production decisions A. Singapore
B. Human resource management B. Japan
C. Marketing decisions C. South Korea
D. Overall firm strategy D. China
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 89
323. An exchange of a good or service. C. political stagnation
A. Trade D. technological innovation
PRACTICE BOOK» NOT FOR SALE
B. Trade barrier
329. The bellow are kind of political argument
C. Ethics
for government intervention in trade, ex-
D. Import cept:Protecting jobs and industries
324. A person who buys products or services. A. Protecting jobs and industries
A. Consumer B. Strategic trade policies
B. Currency C. National security
C. Culture D. Furthering foreign policy objectives
D. Negotiate
330. The following factor does not differenti-
325. In absolute advantage theory, with spe- ate international business from domestic
cialization, total world output will business
A. increase A. Different Currencies
B. decrease
B. Product Quality
C. remain unchanged
C. Product Mobility
D. fluctuate
D. Trade Policies
326. Capital supplied by residents of one coun-
try to residents of another is known as 331. When an exchange rate of a currency de-
A. international investments preciates it means that:1) one unit of it
buys less of a foreign currency than be-
B. host-country financing fore2) one unit of it buys more of a for-
C. international franchising eign currency than before3) the price level
in that country has fallen4) the country’s
D. domestic inversion financing
exports will become more expensive
327. These are typically found in airports & A. 1
seaports and do not follow the regular
trade customs and are considered duty- B. 2
free C. 3
A. Free-trade zones
D. 4
B. Free-trade agreements
C. non-tariff alliances 332. The positive and negative ideals, cus-
toms, and institutions of a group is known
D. Common markets
as
328. Two major forces that underlie the expan- A. Beliefs
sion of globalization are falling barriers to
trade and investment, and B. Values
A. elevation of nationalism C. Assumptions
B. rise of closed economies D. Culture
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 90
333. A grants the inventor of a new prod- 338. Business attire should be
uct or process exclusive rights for a de- A. well-fitted and neat.
fined period of time to the manufacture,
use, or sale of that invention. B. bright and make a statement
A. copyright C. tight and revealing.
B. trademark D. loose and wrinkled
C. contract 339. In a culture with strong business and fam-
ily ties
NARAYAN CHANGDER
D. patent
A. Protecting a family member is some-
334. Which agreement can replace the Court of times more important than a good busi-
International Trade on duty disputes? ness decision
A. WTO B. Family members are usually promoted
B. NAFTA first in family owned business
C. FTA C. Several members of a family may work
in the same business
D. ITC
D. All of the above
335. A US company can obtain political risk in-
surance on its export shipments from 340. When countries join together to eliminate
duties and other trade barriers, allow com-
A. The US Dept of Agriculture
panies to invest freely in each other’s coun-
B. The Export-Import Bank of the United try, and allow workers to move freely
States across borders, they are said to have
C. The Overseas Private Investment Cor- A. Free-Trade Zones
poration
B. Most favored nation status
D. Free-trade agreements
C. A free trade agreement
336. Like the European Economic Community, D. A common market
MERCOSUR is an economic and polit-
ical bloc comprising Argentina, Brazil, 341. Which is the right sequence of stages of
Paraguay, Uruguay, and Venezuela. What Internationalization
level of economic integration is MERCO- A. Domestic, Transnational, Global, Inter-
SUR? national, Multinational
A. free trade zone B. Domestic, International, Multinational,
B. common market Global, Transnational
C. free-trade agreement C. Domestic, Multinational, International,
Transnational, Global
D. none of above
D. Domestic, International, Transna-
337. An export is a tional, Multinational, Global
A. Good/service brought into a country 342. Which of the following is not a disadvan-
B. Good/service sent to another country tage of exporting?
C. Good brought into a country A. vulnerability to tariffs
D. none of above B. logistical complexities
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 91
C. potential conflicts with distributors 348. What is the result when the gross domes-
D. restrictions on foreign investment tic product (GDP) of a nation is divided by
its population?
PRACTICE BOOK» NOT FOR SALE
343. consist(s) of business transactions
A. per capita GDP
between parties from more than one coun-
try. B. per capita income
A. Currency exports C. proportionate GDP
B. International business D. GNP
C. Domestic business
349. When facing ethical dilemmas in interna-
D. Global ventures tional business, what is one of the ques-
tions that should be asked?
344. A trade is a restriction to free trade.
A. Wil I get into trouble?
A. barrier
B. deficit B. Who will know?
C. surplus C. Is the action legal?
D. none of above D. Should I tell someone?
345. Examples of political risk include 350. Which of the following terms is used to
A. Trade sanctions refer to the positive or negative evalua-
tions, feelings, and tendencies that individ-
B. Expropriation uals harbor toward objects or concepts?
C. Economic Nationalism
A. customs
D. Civil Unrest or War
B. attitudes
E. All of them
C. traditions
346. What is the name of IPMI’s Platform D. values
for student that helps to develop Business
Ideation related to Start Up Incubator? 351. In Mercantilism theory, trade surplus con-
A. Investment Gallery dition is a situation where:
B. Innolab A. Export = Import
C. Duke of Edinburg Program B. Export > Import
D. Joint Degree Program C. Import < Export
347. How does centralization aid in rapid D. Holding of gold/silver
decision-making?
352. Among the factors that affect the balance
A. Less people making decision, so con- of trade figures are
clusion reached quickly.
A. Exchange rates, taxes, tariffs and
B. Less people making decision, so con-
trade measures
clusion reached over a long period of time.
B. The business cycle at home or abroad
C. More people making decision, so con-
clusion reached quickly. C. Trade barriers and agreements
D. It doesn’t aid in rapid decision making. D. Non tariff barriers
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 92
353. International nonprofit organizations are B. A German company which sells car
called components to British car makers
A. multinational corporations C. A U.S. company that builds a computer
hardware manufacturing facility in India
B. multinational organizations
D. A Swiss watch manufacturer that
C. multinational enterprises
builds a manufacturing facility in Switzer-
D. multinational nonprofits land
NARAYAN CHANGDER
354. An export can be defined as any prod- 358. is a process that establish a working
uct that is:1) made from goods bought agreement between two companies. As
from another country2) sold to another part of the agreement, one company will
country3) bought from another country4) custom produce parts or other materials on
made in another country behalf of their client. A is refer to
A. 1 A. Franchising
B. 2 B. Contract manufacturing
C. 3 C. Turnkey Project
D. 4 D. Joint Venture
359. is the process by which ideas and
355. ‘Free international trade’ means that:1)
information are exchanged; includes lan-
goods can be transported between coun-
guage, body language and facial expres-
tries free of charge2) all countries use the
sion and eye contact and physical contact.
same currency so it does not cost anything
to convert currencies3) there are no tar- A. Culture
iffs or quotas to limit trade between coun- B. Communication
tries4) businesses can produce in any coun-
C. Etiquette
try without any legal controls
D. none of above
A. 1
B. 2 360. A multinational enterprise is not acting
with social responsibility if it
C. 3
A. Installs anti-pollution controls more
D. 4 powerful than required by law
356. are purchases of foreign financial as- B. Hires host-country citizens and pro-
sets for a purpose other than control. vides training
A. Foreign direct investments C. Introduces new products that support
dominant religious beliefs of the host
B. Global business investments
D. Hires all employees from the home
C. Foreign portfolio investments country labor force
D. Indirect investments
361. Why might English be considered a uni-
357. Which of the following is an example of versal language
globalization of production? A. Everybody loves English
A. Canadian consumers who import food B. English is understood in almost every
products from Australia country worldwide
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 93
C. English is very easy to learn 367. One potential advantage for a country
D. none of above of encouraging a multinational business
to set up isthat it will:1) always create
PRACTICE BOOK» NOT FOR SALE
362. Interdependent political, economic, and more jobs than might be lost2) keep all of
legal systems of a country make up its: the profits made within the country3) not
compete with the existing national busi-
A. administrative agenda.
nesses4) pay taxes to the government
B. socioeconomic fabric.
A. 1
C. economic environment.
B. 2
D. political economy.
C. 3
363. Respect the rules of D. 4
A. everything
368. Meeting Consumer Needs is an example
B. nothing of
C. Physical distance A. quotas
D. none of above B. tariffs
364. Boeing, an American firm, sells commer- C. exporting
cial aircraft to Lufthansa in Germany. This D. benefits of international trade
is an example of
369. Which product is the least exported to
A. exporting
Germany?
B. importing
A. Gold
C. licensing
B. Fruit and Nuts
D. franchising
C. Coal
365. The African Economic Community (AEC) is D. Medical Instruments
an organization of African Union states es-
tablishing a single market, a central bank 370. What does FDI stand for?
and a common currency. What type of ar- A. Federal Department of Investment
rangement does this BEST represent?
B. Foreign Distinct Investment
A. common market
C. Foreign Direct Investment
B. free trade agreement
D. Franchising Department of Investment
C. most favored nation status
D. none of above 371. A new round of talks Doha focusing on
these term, except
366. The increasing interdependence or inte- A. Cutting tariffs on industrial goods and
gration of the world economy. service
A. Individualism B. Increasing subsidies
B. Globalization C. Reducing barriers to cross-border in-
C. Stockholders union vestment
D. Inter-relational business D. Limiting the use of anti-dumping laws
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 94
372. What occurs when items that consumers 377. What is repatriation of profits
want and need are created in other coun-
A. The transfer of corporate money from
tries?
a foreign country
A. competitive advantage
B. A fancy way of saying debt
B. absolute advantage
C. Management of large amounts of
C. trade barrier money from an outside country
D. global dependency D. none of above
NARAYAN CHANGDER
373. NAFTA is an agreement among the U.S., 378. Modes of operations in international busi-
Canada, and Mexico primarily intended to ness as below EXCEPT
promote
A. licensing
A. environmental protection
B. domestic business
B. military defense
C. FDI
C. human rights
D. import & export
D. free trade
379. export is achieved by contracting with
374. What is a written promise from a bank to brokers located in the local market of the
make a payment after verifying that some- company
one has met certain stated conditions?
A. Export Indirect
A. a bond
B. Export Direct
B. letter of credit
C. Import Direct
C. long-term financing
D. Import Indirect
D. short-term financing
380. Offering an item, money or other consid-
375. Which factors related to the foreign coun- eration to provoke unethical actions by re-
try will affect the way of negotiation? ceiver.
(multiple correct answers)
A. Bribery
A. ecnomic
B. Pawnshop
B. infrastructure
C. Engaged employees
C. political system
D. Stakeholders
D. legal system
381. Which of the following is characteristic of
376. Which of these are not an Multinational globalization of markets?
Company.
A. lack of skilled labor
A. Apple Inc
B. conservatism
B. BP
C. declining trade barriers
C. Unilever
D. diminishing gap between the rich and
D. Greggs the poor
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 95
382. An example of a multilateral trade agree- C. Small Management of Enterprises
ment is: D. Societies for Managing Exports
PRACTICE BOOK» NOT FOR SALE
A. NAACP
388. Meaning can be conveyed in a nonver-
B. NCAA bal way by facial expressions, upper and
C. NAFTA lower body movements, and gestures by
D. NBC using
A. Contexting
383. A nation’s money-can be in coins or ban-
knotes. B. Culture
A. Currency C. Values
B. Embargo D. Body language
C. Franchise 389. A trade pattern is:
D. Trade barrier A. what a country trades
384. The making, buying, and selling of goods B. what direction a country trades in
and services within a country is called C. what a country trades and in what di-
A. international business rection
B. world trade D. when a country trades
C. imporing 390. Sports teams having their logo on memo-
D. domestic business rabilia is considered?
A. Licensing
385. Presence of numerous factors prevailing
in the environment that change overtime. B. Joint venture
A. Environmental Uncertainty C. Franchising
B. Environmental complexity D. Infrastructure
C. Environmental firm 391. Restate words from one language into
D. none of above another language
A. Export
386. In 2019, Brazil exported $224 billion
in products and imported $177 billion in B. Translate
products. What is this discrepancy be- C. Resource
tween exports and imports called?
D. Negotiate
A. trade surplus
B. trade deficit 392. What is the Degree’s name of IPMI In-
ternational Business School for Bachelor
C. unfavorable balance of trade Study Program?
D. favorable balance of trade A. Bachelor of Business Administration
387. SMEs stands for: B. Bachelor of Accounting
A. Small and Medium Entrepreneurs C. Bachelor of International Business
B. Small and Medium-sized Enterprises D. Bachelor of Administration
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 96
393. A company that is worried about the 398. International corporations have
norms and customs of a country would rapidly
need to consider which component of the
A. been
international business environment?
B. grown
A. Environmental
C. gone
B. Social
D. none of above
C. Economic
NARAYAN CHANGDER
D. Technological 399. Which strategy is make sense when there
are low cost pressures and low pressures
394. A three-country trade agreement negoti- for local responsiveness?
ated by the governments of Canada, Mex-
A. Localization strategy
ico, and the United States that took effect
in 1989. B. Global standardization strategy
A. The UN C. Transnational strategy
B. NAFTA D. International strategy
C. NATO 400. MNC Stands for
D. IMF A. Multi-National Cooperation
395. What is Globalization B. Multi-National Corporation
A. The process of someone trying to take C. Multi-National Company
over the world D. Multi-National Collaboration
B. When we all do they same thing
401. Why is the per capita GDP is a better
C. The process by which people their measure of a nation’s economic develop-
ideas and their activities in different parts ment than overall GDP?
of the world become interconnected
A. It shows how wealthy each person in
D. Never heard of it the country is.
396. Equity comes from: B. It uses the exchange rate of the cur-
rency involved.
A. Bond issues
C. It gives a better comparison between
B. Loans
countries of different population sizes.
C. Receivables
D. It shows how the unemployment rate
D. None of above affects GDP.
397. International trade makes sense when it 402. A method of indirect or non-verbal com-
is based on munication is
A. comparative advantage A. Cultural Baggage
B. exchange rates B. Culture
C. high gold value C. Values
D. excess production D. Body Language
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 97
403. In 2014, Australia exported this item the B. potential size of market
most to Singapore. C. foreign exchange in market
PRACTICE BOOK» NOT FOR SALE
A. Milk D. legal and political environment in mar-
B. Beef ket
C. Aircraft parts 408. Inflation often causes tha currency of the
D. Petroleum country with the highest rate to
404. PepsiCo and Thomas J. Lipton Co. estab- A. Depreciate
lished a joint venture. PepsiCo supplied an B. Appreciate
extensive distribution network, and Lip- C. Peg
ton provided manufacturing expertise and
brand recognition in teas. What benefit of D. None of the above
strategic alliances were they most likely
409. The most serious form of political risk for
seeking?
a multinational company is
A. ease of market entry
A. Privatizaiton
B. shared risk
B. Exproptriation
C. shared knowledge
C. Import quotas
D. synergy
D. Double taxation
405. A US high school sophomore belongs to
410. In 2017, Canada enforced an asset
the subculture of
freeze and dealings ban on Venezuela.
A. Senior citizens Canada also prohibits citizens and Cana-
B. Professional althetes dian residents from providing any goods
to Venezuela. What type of trade barrier
C. Students
does this BEST represent?
D. Baby boomers
A. trade embargo
406. When a country has the ability to produce B. trade sanction
more of a product relative to another coun-
C. boycott
try.
D. exapropriation
A. Absolute Advantage
B. Favorable Balance of Favorable Bal- 411. Who is the founder of IPMI International
ance of Trade Business School?
C. Positive Net Export A. Ridwan Kamil
D. Comparative Advantage B. BJ Habibie
C. Bustanil Arifin
407. Executives at KBH Enterprises are consid-
ering the idea of entering the Taiwanese D. SBY
market through a licensing agreement.
Which of the following factors is LEAST rel- 412. International business is also known as
evant to the firm’s assessment of the Tai- trade.
wanese market? A. global
A. current size of market B. world
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 98
C. foreign A. Geography
D. domestic B. Economic
413. A country concerned about lack of skilled C. Cultural
workers to complete jobs in emerging ca- D. Political and Legal Concerns
reers would have potential business part-
418. Which of the following is not an advan-
ners concerned with which component?
tage of exporting?
A. Political
A. Easier way to enter into international
NARAYAN CHANGDER
B. Legal markets
C. Social B. Limited presence in foreign markets
D. Technological C. Comparatively lower risks
414. The most valuable import from Japan to D. Less investment requirements
Australia in 2014 was 419. What is the BEST definition for money?
A. Rubber tyres A. anything that can be exchanged for
B. Gold good and services
C. Fuel B. coins
D. Passenger vehicles C. paper currency
D. a standard of measurement for ex-
415. Under a(n) , each partner in the joint
change
venture fully and actively participates in
managing the alliance. 420. All of the following are benefits of inter-
A. shared management agreement national business except
B. assigned arrangement A. expanded business opportunities
C. delegated arrangement B. increased sources of raw materials
D. consensual arrangement C. decreased competition
D. improved political relationships
416. The international organization that as-
sists countries by promoting economic co- 421. The WTO was established to implement
operation and maintaining an orderly sys- the final act of Uruguay Round agreement
tem of world trade and exchange rates. of
A. World Trade Organization A. MFA
B. The International Monetary Fund B. GATT
C. The International Finance Corporation C. TRIP’s
D. The International Development Associ- D. UNO
ation
422. A good or service purchased and brought
417. The government of the United States al- in from another country.
lows consumers to make decisions about A. Import
goods and services consumed. Which main B. Export
factor of the international business en-
vironment is this information about this C. Trade
country classified? D. Negotiate
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 99
423. reduces trade barriers and encour- B. GDP
ages trade between countries. C. GNP
PRACTICE BOOK» NOT FOR SALE
A. Free-trade zones D. imports/exports
B. Free-trade agreements
428. If a country has low literacy levels, little
C. non-tariff alliances to no technology and focuses on agricutlre
D. Common markets or mining, that country is considered to be:
A. Developing
424. In which of the following modes of entry,
does the domestic manufacturer give the B. Industrialized
right to use intellectual property such as C. Less-Developed
patent and trademark to a manufacturer D. none of above
in a foreign country for a fee
A. Licensing 429. Examples of Globalization are
A. Internet
B. Contract manufacturing
B. Attending lectures by a British profes-
C. Joint venture
sor teaching in an American University
D. None of these
C. Selling local products in the global mar-
425. Which of the following is NOT a corrup- ket
tion issue? D. All of the above
A. Expected bribes 430. How many permanent members of the
B. Sweatshop conditions UN Security Council are there?
C. Deceptive advertising A. Four
D. High pressure sales techniques B. Five
C. Six
426. What is International Business?
D. Fifteen
A. the making, buying and selling of
goods and services within a country’s bor- 431. A is a special type of strategic alliance
der. in which two or more firms join together to
B. the making, buying and selling of create a new business entity that is legally
goods and services across national bor- separate and distinct from its parents.
ders A. joint venture
C. the ups and down of business activity B. licensing agreement
D. the ability of a country to produce a C. franchising arrangement
good more efficiently than other coun- D. greenfield strategy
tries.
432. Which ratio below is used to measure fi-
427. In 2018, Bermuda exported $199 million nancial leverage?
of goods and services and imported goods
A. Fixed costs / Variable costs
and services worth $1.45 billion. What
is the discrepancy between Bermuda’s ex- B. Sales / Total assets
ports and imports called? C. Debt / Equity
A. balance of trade D. Current assets / Long-term assets
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 100
433. Australia’s biggest export to China is 438. The item imported the most from
Malaysia in 2014 was
A. Iron Ore
A. Computers
B. Barley
B. Petroleum
C. Copper
C. Furniture
D. Coal
D. TV’s
434. Which of the following is not a mode of
NARAYAN CHANGDER
entry into foreign markets? 439. Ron lives in a small, isolated town in
Central Montana. There is only one hos-
A. exporting
pital within 100 miles of where he lives.
B. importing What type of competitive situation does
C. international licensing this BEST represent for the hospital?
D. greenfield strategy A. monopolistic competition
B. monopoly
435. Winston Foods and O’Toole’s Soda have
agreed to perform together multiple C. pure competition
stages of the process by which products D. oligopoly
are brought to the market. The two firms
have most likely formed a 440. A tax levied as a proportion of the value
of the imported good is the definition of
A. joint venture
A. Tariffs
B. production alliance
B. Specific tariffs
C. process alliance
C. Import quotas
D. comprehensive alliance
D. Ad valorem tariffs
436. In a , individual managers belong to
two hierarchies (a divisional hierarchyand 441. The is the value of a currency in one
an area hierarchy) and have two bosses (a country compared with the value in an-
divisional boss and an area boss). other.
A. worldwide product division structure A. exchange rate
B. matrix structure B. intereset rate
C. worldwide area structure C. comparison rate
D. performance structure D. none of above
437. Silk is a product created by what type of 442. Which of the following is a characteristic
resource? of foreign direct investment?
A. Labor A. relatively low financial investment
B. Capital B. low exposure to political risk
C. Land C. high profit potential
D. none of above D. simple management
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 101
443. Outsourcing a part of or entire production 448. Which type of situational analysis con-
and concentrating on marketing operations centrates specifically on competitor based
in international business is known as challenges and activities?
PRACTICE BOOK» NOT FOR SALE
A. Licensing A. Porter’s 5 Forces
B. Contract Manufacturing B. SWOT
C. Joint venture C. 3C
D. none of above D. 5C
449. Religion of a person affects his/her
444. How should you dress
A. Attitude towards entrepreneurship
A. Bummy
B. Gifting practices
B. Fancy
C. Use of products
C. For success
D. All of the above
D. none of above
450. Planning that requires taking action be-
445. Globalization refers to: fore international pressure forces a strat-
egy is known as
A. Lower incomes worldwide
A. Proactive planning
B. A more integrated and interdependent
world B. reactive planning
C. Less foreign trade and investment C. Tactical planning
D. Global warming and their effects D. Strategic planning
451. A tax that can be used as a trade barrier
446. The attitudes and behavior that are char-
is the
acteristic of a particular social group or or-
ganization (this can include religion, lan- A. Personal tax
guage, customs, traditions, food, etc.) B. Excise tax
A. Trade C. Value-added tax
B. Tariff D. Import duty tax
C. Culture 452. Which of the following is not a document
D. Export related to export transaction?
A. Shipping Bill
447. Gross Domestic Product (GDP) measures:
B. Airway Bill
A. the amount of money a country owes
C. Mate’s Receipt
to other countries
D. Bill of Entry
B. the output of products created within
a country 453. The negotiating team should include mem-
C. the difference between what a coun- bers in each of the following areas except
try sells versus what a country buys from ( ).
other countries A. commercial
D. none of above B. techinical
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 102
C. financial 458. An organization acting as a court to hear
and settle trade disputes among its mem-
D. psychological
bers; also abbreviated WTO.
454. Corporate social responsibility occurs A. International
when business public ethical, legal, B. World Trade Organization
commercial, and expectations
C. International trade
A. Reacts
D. Domestic trade
NARAYAN CHANGDER
B. meets or exceeds
459. IBRD (International Bank for Reconstruc-
C. Understands tion and Development) also known as
D. hears A. EXIM Bank
B. World Bank
455. Pressures for cost reductions are great-
est when C. International Monetary fund
A. major competitors are based in low D. International Bank
cost locations
460. If I am better at all types of production,
B. differences in consumer tastes and I have the In all forms of production.
preferences A. comparative advantage
C. differences in traditional practices and B. specialization
infrastructure
C. developed nation
D. differences in distribution channels
D. Absolute advantage
456. One potential disadvantage for a country 461. Franklin Carpets engages in indirect ex-
of encouraging a multinational business to porting, so the firm sells its carpets to a(n)
set up is that:
A. jobs might be lost in existing national A. domestic customer who then sells the
businesses carpets to a foreign customer
B. tax revenue to the government will fall B. foreign customer who then sells the
carpets to a domestic customer
C. these companies never export any
products from the countries they operate C. affiliated company located in a foreign
in country
D. costs of production are likely to be high D. foreign customer through e-commerce
and this will raise prices
462. What is the main reason for shifting prof-
its from one country to another country?
457. An office building is a product created by
what type of resource? A. To benefit from a difference in tax
rates
A. Labor
B. To avoid double taxation
B. Capital
C. To benefit from investment opportuni-
C. Land ties
D. none of above D. To increase overall pre-tax profits
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 103
463. Check all that apply. List the four main 468. is the belief that national prosperity
elements of the international business en- is the result of a positive balance of trade,
vironment. achieved by maximizing exports and mini-
PRACTICE BOOK» NOT FOR SALE
A. Geography mizing imports.
B. Cultural Influences A. Positivism
C. Economic development B. Imperialism
D. Political and legal concerns C. Communism
E. Free-trade D. Mercantilism
464. A strong Australian dollar means 469. Some barriers to trade are
A. Imports will be cheaper A. tariffs
B. Imports will be dearer B. quotas
C. Exports will be cheaper
C. laws
D. Exports will be dearer
D. all of the above
465. Which of the following statements is
not a true statement about strategic plan- 470. An agreement between more than two
ning? nations.
A. It helps a business ensure that all ele- A. Ethics
ments of the organization are heading to- B. Multilateral agreement
wards the same goal.
C. Trade
B. It forces a business to analyze the
whole organization. D. Depreciate
C. It is not especially useful in allowing a 471. The first step in preparing for negotia-
business to respond to problems. tions is ( ).
D. All of the above statements are true A. mining the critical information from dif-
ferent resources.
466. Products that are made within one’s bor-
ders, and sold overseas are known as: B. knowing a particular executive’s back-
A. International products ground, hobbies, and family status.
B. Exports C. designing agenda for negotiation
C. Imports D. sizing up the probable goal and pref-
erences of your counterpart’s analysis of
D. None of these
data.
467. occurs when two parties agree to ex-
change currency and execute the deal at 472. Why should military force be the last tool
some specific date in the future. used for foreign policy?
A. Currency arbitrage A. it’s expensive
B. Forward exchange B. risks American lives and lives of others
C. Spot currency exchange C. can lead to war
D. Restricted trade D. all of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 104
473. General Agreements on Tariffs and Trade C. Quota
was established in D. Deal
A. 1945
479. Dymtrus purchases semi-precious gem-
B. 1947 stones from a distributor in South Africa,
C. 1957 and he contracts to pay for the gemstones
D. 1974 before they actually reach him. What type
of payment method does this represent?
474. Porter’s five forces model focused on
NARAYAN CHANGDER
A. Long term financing
threat of a new entrants.
B. Letter of credit
A. Potential entrants
C. Cash in advance
B. Substitute
D. none of above
C. Buyers
480. International business is:
D. none of above
A. all activities needed to create, ship
475. The most successful Australian export is and sell products across international bor-
ders.
A. Hugh Jackman B. making, buying, and selling products
B. Kraft Peanut Butter within a country.
C. Kingaroy Peanuts C. refers to a world economy with move-
ment of products and labor across inter-
D. Vegemite national borders.
476. What is a situation in which a company D. none of above
in Germany buys products from a company
in the United Kingdom using an intermedi- 481. Global norm is:
ary? A. when tastes/preferences of con-
sumers in different nations begin to in-
A. Free tade agreement
tersect
B. Countertrade
B. when tastes/preferences of con-
C. indirect import sumers in different nations are com-
D. direct import pletely different
C. when everything remains the same
477. a risk in which the exchange rates of ei-
and nothing changes.
ther of the two countries will fluctuate
D. when companies only sell products
A. Risk
within their borders
B. Economic Risk
482. In some countries business women should
C. Exchange Rate Risk
only shake hands if
D. Legal Risk A. a business man offers his hand first.
478. is a tax that a government places on B. it is with another business woman.
certain imported products C. she is being introduced to men and
A. Tariff women.
B. Embargo D. the business meeting is over
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 105
483. Intangible trade is related with 488. Which factor determines if a business
A. Services should be centralized?
PRACTICE BOOK» NOT FOR SALE
B. Goods A. A large business
C. Both B. highly important decision, that has
high-cost implications
D. None of these
C. Excessive use of Information Commu-
484. Governments encourage and promote its nications Technology
country’s exports primarily because
D. Low level risk decisions
A. Exports increase government rev-
enues by selling export insurance 489. A theocratic law system is:
B. Exports increase the country’s interna- A. one in which the law is based on reli-
tional image and reputation gious teachings.
C. Exports create jobs and foster eco- B. based on tradition, precedent, and cus-
nomic prosperity tom.
D. none of above C. based on a detailed set of laws orga-
nized into codes.
485. Moving down the experience curve:
D. the body of law that governs contract
A. increases the cost of a firm’s raw ma- enforcement.
terial.
B. allows a firm to reduce its cost of cre- 490. Tariffs, quotas, and boycotts are exam-
ating value. ples of
C. decreases a firm’s profitability. A. Civil Unrest
D. increases the research and develop- B. Political Unrest
ment expenditure of a firm C. Trade Barriers
486. In product life cycle theory, a products D. Non of these
mature, both the and the optimal
will change affecting the flow and direc- 491. Chrysler and BMW formed a joint ven-
tion of trade. ture to build engines in South America.
Which term best describes this type of al-
A. location of sales liance?
B. location of packaging A. franchise agreement
C. location of production B. financial alliance
D. location of distribution C. licensing agreement
487. Lack of complete information about the D. production alliance
current and future environment of the
firm. 492. The keyword Multinational means
A. Environment Uncertainty A. In one country
B. Environment complexity B. In every country
C. Environment firm C. In more than one country
D. none of above D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 106
493. Protectionism policies such as tariffs and 498. A(n) is a citizen of one country who
quotas are used because is working abroad in one of the firm’s sub-
A. The government wants to make it sidiaries.
harder for companies in other countries to A. international manager
compete with local companies
B. global citizen
B. Consumers need to be protected from
C. expatriate manager
inferior or hazardous products
D. ethnocentric manager
NARAYAN CHANGDER
C. The country needs additional revenue
D. none of above 499. Performa Invoice is issued by the-
494. Goods and services purchased abroad A. Shipping company of importer
and brought into a country are called B. Exporter to importer
A. gross domestic products C. Importer to exporter
B. gross national products D. Exporter to the shipping company
C. imports
500. What is a transnational company
D. exports
A. Moving across the world
495. The world’s economies are becoming B. Getting a job from a company thats in
more interdependent each day. This is a different country than you are in
known as:
C. Selling goods to countries
A. New economies
D. Large global firms that operate in a
B. None of these number of countries
C. Geographic clusters
501. Making, buying, and selling goods and
D. Globalization services within a country is called
496. If Phillips has a European division, North A. international business
American division and an Asian division, B. global dependency
each of the divisions can be referred to as
C. domestic business
A. Strategic planning units
D. none of these
B. Strategic business units
C. Remote business units 502. A citizen of the United States who has
recently returned home after living in an
D. Business administration units
underdeveloped section of Africa for two
497. Purchasing the right to use a company years is likely to say
name or business process in a specific way A. “Everything is exactly as it was when
. For example, McDonald’s, Burger King, I left two years ago”
KFC and Pizza Hut .
B. “Wow, There is a lot of choice of fla-
A. Licensing vors of cold cereal!”
B. Joint venture C. “it is such a civilized treat to have air-
C. Franchising conditioning.”
D. Infrastructure D. None of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 107
503. Member countries agree to remove du- 508. The exchange of capital, goods, and ser-
ties and trade barriers on products traded vices across international borders or terri-
among them is an example of tories.
PRACTICE BOOK» NOT FOR SALE
A. Free-trade zones A. Consumer
B. Free-trade agreements B. International trade
C. Common Markets C. Domestic trade
D. none of above D. Subsidy
504. Which are true about Mercantilism the-
509. The means of payment “compensation
ory?
deals” includes:
A. Country’s wealth is measured by its
A. Barter
holding of gold and silver
B. Product
B. Government does not imposed any
control C. Goods and cash
C. Among the first theory and served as D. Cash
the foundation towards trading activities
510. All of the following choices are examples
D. Countries will try to be in a trade
of nonverbal communication except
deficit condition
A. Standing two feet from your friend
505. “Rajiv an exporter sent complete infor-
mation about the quality, grade, size, B. Speaking to your teacher
weight, type of packing about the product C. Wearing red on Valentine’s Day
on his enquiry” .Such an above quotation D. Waving to a friend
prepared is known as-
A. performa invoice 511. One possible disadvantage to businesses
of globalisation is that:1) all products
B. intent
will become more expensive2) there will
C. letter of information be more international competition3) there
D. enquiry performa will be less choice and variety for their con-
sumers4) they will tend to produce on a
506. The US imports the most from this coun- small scale and this will raise costs
try
A. 1
A. China
B. 2
B. Japan
C. 3
C. Canada
D. 4
D. England
507. By having business in different countries, 512. Which one of the following is not
a firm reduces amongst India’s major export items?
A. Credit Risk A. Textiles and garments
B. Political Risk B. Oil and petroleum products
C. Financial Risk C. Gems and jewellery
D. Business Risk D. Basmati rice
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 108
513. What three benefits does FDI bring to the B. Free-Trade Agreement
host country?
C. Trade Embargo
A. Brings high paying new jobs
D. Tax Holiday
B. Increases imports
C. Brings new technology 518. Company X and Company Z have estab-
lished a business arrangement whereby
D. Increases exports the two firms will cooperate for their mu-
tual benefit. Which of the following has
NARAYAN CHANGDER
514. What is the one positive direct impact for
business from enhancing their ethical be- most likely been established?
havior A. competitive advantage
A. Accruing more market shares B. licensing agreement
B. Building consumer based operation C. franchising arrangement
C. Enhancing foreign investment
D. strategic alliance
D. Enhancing corporate image
519. Companies can reduce much of the risk in
515. What was the outcome of The North global sourcing by employing:
American Free Trade Agreement?
A. Appropriate Strategies
A. non-tariff barriers to agricultural trade
between the U.S. and Mexico were elimi- B. Skillful management
nated C. Cost reduction
B. disorganization in trade between the
D. Increased benefits
U.S. and Canada
C. tariff trade would be eliminated in 25 520. Some societies have a strong belief in ,
years which means that the belief in the individ-
D. non-tariff barriers to technological ual and his or her ability to function rela-
trade between the U.S. and Mexico were tively independent.
eliminated A. Collectivism
516. Which of the following is NOT true re- B. Values
garding a worldwide area structure? C. Individualism
A. It tends to be favored by firms with a D. Ethnocentrism
low degree of diversification
B. It facilitates local responsiveness 521. refers to the superior features of
C. It tends to be favored by firms with a a country that provide unique benefits in
domestic structure based on functions global competition, typically derived from
either natural endowments or deliberate
D. Decision-making responsibilities are national policies.
centralized
A. Comparative advantage
517. An agreement between countries that
B. Competitive advantage
eliminates duties and trade barriers on
products traded among members C. Absolute advantage
A. Social Responsibility D. Industrial cluster
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.2 International Business 109
522. refers to a world economy with move- B. the making, buying and selling of
ment of products and labor across interna- goods and services across national bor-
tional borders. ders
PRACTICE BOOK» NOT FOR SALE
A. Global economy C. the ups and down of business activity
B. Domestic business D. the ability of a country to produce a
good more efficiently than other coun-
C. International business
tries.
D. none of above
527. What is the most important activity
523. Generally accepted principles of right and among the cash flow sources?
wrong governing individual conduct are
A. Investment activity
known as what?
B. Operating activity
A. ethical dilemmas
C. Financing activity
B. ethical imperialism
D. None of above
C. corruption
D. personal ethics 528. When people communicate very directly
and relay on literal interpretations they
524. What is it called when a country has an are known to be
advantage at producing both computers A. High context
and clothing but computers are more prof-
itable so it chooses to produce them and B. Low context
buy clothing elsewhere? C. Face savings
A. Comparative Advantage D. Language differences
B. Absolute Advantage
529. Which of the following is NOT a charac-
C. Multinational Corporation teristic of exporting?
D. none of above A. high financial exposure
525. What is the meaning of corruption? B. gradual market entry
A. the practice of obtaining power, per- C. logistical complexities
sonal gain, or influence through illegiti- D. local market knowledge
mate means, usually at others’ expense
530. The following is the component of sup-
B. the practice of obtaining power, per- port activities EXCEPT
sonal gain, or influence through legal
means, usually at others’ benefits A. Information system
C. The practice of gaining influence for B. Logistics
the public interests C. Human resources
D. None of the above D. R & D
526. What is domestic Business? 531. is the buying of products made in
A. the making, buying and selling of other countries for use or resale in one’s
goods and services within a country’s bor- own country.
der. A. Exporting
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 110
B. Importing C. Values
C. Merchandising D. Technology
D. Transporting
534. If a nation imports more than it exports,
532. Historically, international business it has a trade
A. is a relatively new concept made pos- A. deficit
sibly by communications technolgy B. surplus
NARAYAN CHANGDER
B. probably occurred as long as 15, 000 C. balance
years ago
D. none of above
C. declined when European countries cre-
ated colonies on other continents 535. How close you stand near another person
D. none of these is referred to as your
A. Pocket space
533. Abstract ideas about what a society be-
lieves to be good, right and desirable, are B. Personal Space
A. Economics C. Parking Space
B. Politics D. Operational Space
1.3 Accounting
1. Paid for supplies bought on account C. SEC
A. +Asset (Cash) D. GAAS
B. -Acct. Payable (Supplies) 4. Computers Incorporated is developing
C. +Acct. Payable (Supplies) a profit-and-loss statement for its in-
D. -Asset (Cash) vestors.
E. +Liability (Supplies) A. Management Accounting
B. Financial Accounting
2. Media Van Lines is collecting information
about how many military veterans it cur- C. Tax Accounting
rently employs. The government requires D. none of above
the company to hire at least 25.
5. We have shown all items of machinery
A. Management Accounting costing less than $100 as machinery oper-
B. Financial Accounting ating expenses.What accounting concept is
C. Tax Accounting being applied?
D. none of above A. materiality
B. going concern
3. Publicly held corporations must follow reg-
ulations created by the C. prudence
A. GAO D. historical cost
B. GAAP 6. Bank service charge:
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 111
A. Add to Book Balance A. Entity assumption
B. Deduct from Book Balance B. Period assumption
PRACTICE BOOK» NOT FOR SALE
C. Add to Bank Balance C. Accrual basis assumption
D. Deduct from Bank Balance D. Going concern assumption
7. Review of transactions on record in accor- 12. The most significant challenge in interna-
dance with set rules and policies tional accounting for American companies
A. Auditing is ?
B. Tax Accounting A. managing multiple currenies
C. Management Accounting B. following GAAP
D. none of above C. complying with the Sarbanes-Oxley
Act
8. “Debit expenses and losses, Credit in-
D. implementing cloud computing
comes and gains” Is the rule for which
type of account? 13. What is the nature of Owners Equity
A. NOMINAL ACCOUNTS A. DR
B. REAL ACCOUNTS B. None of the options
C. PERSONAL ACCOUNTS C. CR
D. none of above D. none of above
9. Accounts Payable is classified as a/an 14. If the creditor’s financial claim to property
in the totals $1, 000 and the owner’s financial
A. Current asset; Balance Sheet claim to property totals $11, 000, the
property value is
B. Current liability; Balance Sheet
A. $10, 000
C. Expense; Income Statement
B. $11, 000
D. Revenue; Income Statement
C. $12, 000
10. Which of the following limitations of ac-
D. $1, 000
counting states that accounts may be ma-
nipulated to conceal vital facts: 15. What is the type of Drawings Account?
A. Accounting is not fully exact A. (a) Personal
B. Accounting may lead to window dress- B. (b) Real
ing
C. (c) Nominal
C. Accounting ignores price level
changes D. Expenses
D. Accounting ignores qualitative ele- 16. This enhancing quality refers to a finan-
ments cial information that is classified, charac-
terized, and presented clearly, and con-
11. The Assumption that reports are prepared cisely.
for a particular period of time, such as a
month or a year in order to obtain compa- A. Comparability
rability of results is the B. Timeliness
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 112
C. Verifiability 22. What is the roles of management accoun-
D. Understandability tant?
A. Provide information and accounting re-
17. Which is the last step of accounting as a ports
process of information?
B. Responsible for carrying out the task
A. Recording the transaction of helping the management
B. Preparation of financial statements C. Assist departments in achieving the or-
NARAYAN CHANGDER
ganization objectives.
C. Communication of information
D. All of above
D. Analysis and interpretation of informa-
tion 23. Accounting graduates can works
as1.External Auditors 2.Lawyers3.Accountants4.Tax
18. The business uses 3% to calculate the dep- Officers
recation of motor vehicle every year. This
is principle. A. 1, 3 and 4
A. consistency B. 1 and 3
B. materiality C. 1, 2 and 3
D. 3 and 4
C. prudence
D. historic cost 24. A planned process for providing financial
information that will be useful to manage-
19. What is the nature of Liability Account ment.
A. CR A. Accounting equation
B. DR B. Accounting Title
C. None of the above C. Accounting System
D. none of above D. Accounting Balance
20. Who is the administrative head of the 25. Under the accrual basis of accounting, rev-
Accountant General Pakistan Revenues enues are reported in the accounting pe-
(AGPR). riod when the:
A. Cash is Received
A. Minister of Finance
B. Service or Goods Have Been Delivered
B. Auditor General of Pakistan
C. End of the Month Has Arrived
C. Controller General of Accounts
D. Customer Pays
D. Governor State Bank of Pakistan
26. If a company sold $1000 worth of goods
21. The starting point of the accounting pro- in a period, the closing entry for the rev-
cess is enue accounts would show a
A. communicating information to users. A. $1000 debit to Income Summary
B. identifying economic events. B. $1000 credit to Sales Revenue
C. recording economic events. C. $1000 debit to Sales Revenue
D. None of these answers are correct. D. $1000 credit to sales expense
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 113
27. Investors are 33. Business entities use accounting to:
A. Suppliers A. Strengthen their financial position to
PRACTICE BOOK» NOT FOR SALE
B. Owners attract new investors.
C. Banks B. Make informed critical decisions about
business operations
D. Customers
C. Record financial transactions that re-
28. What is the system introduced by by Luca quire auditing and financial analysis
Pacioli? D. Determine profitability and asset man-
A. Book Keeping agement
B. Accounting 34. In accounting, the term “recording” is also
C. Double Enter called
D. Double Entry A. journalizing.
29. All the following are the external users of B. communicating.
accounting information EXCEPT C. debiting.
A. Taxing authorities D. crediting
B. Creditors 35. Received cash from customer on account
C. Regulatory authorities A. +Asset (Sales)
D. Management B. -Asset (Supplies)
30. Purchased equipment on account C. +Acct. Payable (B. Smith)
A. +Owners Equ. (Capital) D. +Asset (Cash)
B. -Revenue (Sales) E. -Acct. Receivable (B. Smith)
C. +Acct. Payable (Equ. Store) 36. Which of the following are part of FRSC
D. -Revenue (Sales) A. Board of Accountancy
E. +Asset (Equipment) B. Department of Finance
31. What is the last step in the accounting cy- C. Bureau of Internal Revenue
cle? D. Land Bank of the Philippines
A. Prepare the final balance E. Financial Executive Institute of the
B. Prepare the post-closing trial balance Philippines
C. Prepare the closing balance 37. A fundamental concept that uses a Philip-
D. Prepare the post-closing audit. pine peso for economic activities which al-
lows the accountants to add and subtract
32. It is called the book of original because it peso amounts as though each peso has the
is the accounting record in which financial same purchasing power as any other peso
transactions are first recorded. at any time. Which principle is used?
A. Accounting A. Monetary Principle
B. Ledger B. Disclosure Principle
C. Journal C. Objectivity Principle
D. Book D. Business Entity Principle
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 114
38. Financial rights to the assets of a business. C. accrual concept
A. liabilities D. Historical cost principle
B. expenses 43. The process of recording, summarizing, an-
C. withdrawals alyzing and interpreting of financial data
to make informed decisions is known as:
D. equities
A. accounting adjustments
39. Which of the following categories of infor-
B. accounting cycle
NARAYAN CHANGDER
mation are found on a balance sheet:
C. book keeping
A. Income, expenditures, profit
D. accounting
B. Assets, liabilities, owner’s equity
C. Assets, liabilities, margin 44. Which one of the following is not an objec-
tive of accounting?
D. Revenues, expenses, profit
A. To provide information about the as-
40. Transaction sets, liabilities and capital of the enter-
A. A business deal or action; exchange of prise.
money, goods, or services B. To provide information about the pri-
B. an accounting record in which transac- vate assets and liabilities of the propri-
tions are initially recorded in chronologi- etor.
cal order C. To maintain records of this business
C. A business from which merchandise is D. To provide information regarding the
purchased or supplies or other assets are profit and loss of the enterprise.
bought
45. A specialist who is able to give advice on
D. an accounting period that is one year matters of taxation
long
A. clerk
41. Which bookkeeping Luca Pacioli’s de- B. Management accountant
scribed in his book
C. tax advisor
A. Single entry bookkeeping
D. none of above
B. Double entry bookkeeping
46. Which is the last step in the process of Ac-
C. Triple entry bookkeeping
counting?
D. none of above
A. classifying
42. A company purchased a building twenty B. Identifying
years ago for $150, 000. The building C. Communicating
currently has an appraised market value
of $235, 000. The company reports the D. Summarizing
building on its balance sheet at $235, 000. 47. How would you journalize a dishonored
What concept or principle has been vio- check that a customer used to pay on ac-
lated? count?
A. separate entity concept A. debit Miscellaneous Expense and
B. recognition principle credit Cash
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 115
B. debit Accounts Receivable and credit 53. On which financial statement would the
Cash Supplies account appear?
PRACTICE BOOK» NOT FOR SALE
C. debit Cash and credit Accounts A. Balance Sheet
Payable
B. Income Statement
D. debit Cash and credit Accounts Receiv-
able C. Retained Earnings Statement
48. He makes investment in the hope of mak- D. Statement of Cash Flows
ing profit.
54. “Liabilities are divided into Current Liabili-
A. Manager
ties and Non-current Liabilities and are set-
B. Customer tled when they become due.” Which of the
C. Investor following accounting concepts is the above
statement based on?
D. Owner
A. Going Concern
49. Receivables, loans or other debts that
have virtually no chance of being paid B. Business Entity
A. Uncollectible accounts C. Conservatism
B. Accounts receivable D. Monetary Measurement
C. Notes receivable
D. Corrupted accounts 55. What type of accounting method would
most likely be used by a small business
50. Which form shows a business’s financial owner who does not offer credit?
performance over a reporting period?
A. Check method
A. statement of changes in equity
B. Accrual method
B. balance sheet
C. COD method
C. income statement
D. statement of cash flows D. Cash method
51. Management Consulting includes all of the 56. A list of accounts used by a business.
following except
A. Chart of accounts
A. International mergers
B. closing entries
B. Manufacturing processes
C. Financial forecasting C. adjusting accounts
D. New product introduction D. journal
52. Accounts used to accumulate information 57. Concept:When a source document is pre-
until it is transferred to the owner’s capi- pared for each transaction
tal account.
A. going concern
A. temporary accounts
B. permanent accounts B. materiality
C. adjusting accounts C. realization of revenue
D. none of these D. objective evidence
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 116
58. In Accounting, the term debit is used to in- A. to determine if its financial statement
dicate: are in accordance with the rules and reg-
ulations
A. Increase in Liability and Equity
B. determine how much business earns
B. Decrease in Liability and Equity
in order to assess its tax liabilities
C. Increase in Asset and Liability
C. to have a strong economic structure
D. Decrease in Asset and Liability and keeping abreast of global economic
NARAYAN CHANGDER
D. none of above
59. A bookkeeper should always present the
facts objectively and refrain from slanting 64. These external users of financial reports
information in a misleading way. primarily use accounting information to as-
A. Integrity Standard sess their return on investment in the busi-
ness.
B. Objectivity
A. Government
C. Professional Competence
B. Creditors
D. Professionalism
C. Management
60. What is the role of the IASB? D. Investors
A. Oversee the standard setting and reg-
65. An investment by the owner in the busi-
ulatory process
ness increases the
B. Formulate international financial re- A. Asset and Equity/Capital
porting standards
B. Assets and Liabilities
C. Review defective accounts
C. Liabilities and Equity/Capital
D. Control the accountancy profession
D. Assets only
61. What is the Nature of Asset account
66. Items should be included in the financial
A. CR statements if their omission would mis-
B. DR lead the users of the financial statements.
Which one of the following accounting prin-
C. None of the above ciples governs this?
D. none of above A. Consistency
62. John needs to develop a report for the B. Accruals
president of Lawyer Group which details C. Materiality
the financial goals for 2016. D. Money measurement
A. Management Accounting
67. Evidence that a transaction has occurred is
B. Financial Accounting
A. when you have the item
C. Tax Accounting
B. when money comes out of your ac-
D. none of above count
63. Why do government and tax authorities C. a source document
need accounting information? D. is when you use or consume the item
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 117
68. This is the most basic fundamental concept 73. Which of the following will give a clear pic-
that says, the transactions of different en- ture of financial position of the business
tities should not be accounted for together.
PRACTICE BOOK» NOT FOR SALE
A. Trading A/c
A. Business Concept B. Profit & loss A/c
B. Entity concept
C. Balance sheet
C. Periodicity concept
D. Cashflow Statement
D. Stable monetary unit concept
74. For an accounting system to be useful to
69. The cost of a small calculator is accounted the business, the accounting information it
as an expense and not shown as an asset contains must be
in financial statement of a business entity
A. accurate and up to date.
due to
A. materiality concept B. approved by the chief executive offi-
cer.
B. matching concept
C. posted by an accountant.
C. historic cost concept
D. recorded using the accrual method.
D. principle of full disclosure
75. A financial statement that shows how
70. the set of rules and laws for a country
much a business is worth
which govern how accounts should be pre-
pared A. source document
A. code of conduct B. bank statement
B. creative accounting C. balance sheet
C. local accounting standards D. income statement
D. none of above 76. Accounting Assumptions are
71. The cost of a tape dispenser has been A. the generally accepted way of doing
charged to an expense account although it things as an accountant
will still be in use in 10 years time.Which B. the technical definitions, rules and pro-
accounting concept is being applied? cedures for reporting transactions world-
A. materiality concept wide
B. prudence concept C. the suggested ways an accountant
C. going concern concept may do things
D. accrual concept D. different in every country
72. What does SWOT stand for? 77. Concept:Business transactions are re-
ported in numbers that have common val-
A. Strengths, Weaknesses, Opportuni-
ues. Meaning all reporting should be done
ties, Threats
in terms of money
B. Service, Waiter, Opportunities,
A. Unit of measurement
Threats
C. Strengths, Weaknesses, Opposition, B. historical cost
Teachers C. materiality
D. Save, Wait, Out, Tonight D. matching expenses with revenue
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 118
78. The source document for an electronic C. Forecasting
funds transfer is a D. Ledger posting
A. check
83. A business form that is used to instruct
B. inovoice the bank to pay cash from your account
C. memorandum is called a(n):
D. receipt A. receipt
B. deposit
NARAYAN CHANGDER
79. They are interested in a company’s ability
to continue its existence, especially if they C. invoice
are heavily dependent on the company’s D. check
operations.
A. Government 84. An Asset is:
B. Customers A. Refers to items that are owned
C. Suppliers B. Refers to amounts that are owed to
others
D. Lenders
C. Refers to amounts earned
80. Which does not form part of the general D. none of above
definition of accounting?
85. The Going Concern Assumption is impor-
A. Provides information
tant as it helps to
B. Useful in decision making
A. record, report and value assets that
C. Primarily concerned with historical have occured and will have an effect in the
data financial accounting future
D. Processes transactions of financial B. work out whose financial information
character is being assessed
81. The Period Assumption is important as it C. determine which transactions are in-
helps to cluded or excluded
A. record, report and value assets that D. define the period of time for which we
have occured and will have an effect in the are reporting
future
86. The accounting concept which dictates that
B. work out whose financial information non-current assets should be valued at
is being assessed cost less accumulated depreciation, rather
C. determine which transactions are in- than at their enforced saleable value, is:
cluded or excluded A. Understandability
D. define the period of time for which we B. Relevance
are reporting C. Comparability
82. All of the following are functions of Ac- D. Going concern
counting except
87. a specialist whose job is to carefully check
A. Decision making the accounts and accounting practices of a
B. Measurement company
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 119
A. bookkeeper C. business entity
B. auditor D. prudence
PRACTICE BOOK» NOT FOR SALE
C. income tax
92. The is one of the main financial state-
D. none of above ment and reports the assets, liabilities,
and owner’s equity at a specific point in
88. Which of the following is a standard that time.
defines how accountants record financial
transactions? A. Income Statement
A. generally accepted accounting princi- B. Balance Sheet
ples C. Income Worksheet
B. government applied accounting prac- D. Balance Worksheet
tices
C. general accounting and auditing proce- 93. Which of the following accounting equa-
dures tion is TRUE?
D. government allowed accounting prac- A. Assets + Liabilities = Owner’s Equity
tices B. Owner’s Equity-Liabilities = Assets
89. What is revenues? C. Assets + Owner’s Equity = Liabilities
A. Costs incurred with revenues D. Assets-Liabilites = Owner’s Equity
B. Amounts earned from selling products 94. Financial statements are prepared with
or services the expectation that a business will re-
C. Amounts earned from revenues less main in operation indefinitely.
expenses incurred A. Going Concern
D. Occurs when expenses are more than B. Consistency
revenues
C. Conservatism
90. A partnership is a/an D. Matching Principle
A. Enterprise formed by two or more per-
sons with no maximum limit 95. Which accounting concept states that omit-
ting or misstating this information could in-
B. Business entity owned and managed fluence users of the financial statements?
by only one person
A. Consistency Concept
C. Enterprise formed by two or more per-
sons with a maximum of fifty B. Materiality Concept
D. Business formed by two or more per- C. Prudence Concept
son with a maximum of twenty D. Money Measurement Concept
91. A sole trader has sold his private house but 96. Summary of assets and liabilities
has not recorded anything about it in the
A. Profit and loss account
business records.What accounting concept
is being applied? B. Trading account
A. confidentiality C. Income and expenditure account
B. historical cost D. Balance Sheet
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 120
97. An increase in owner’s equity resulting B. General ledger
from the operation of a business C. Source documents
A. asset D. Worksheet
B. expense
103. Which system maintains low levels of in-
C. withdrawl
ventory?
D. revenue
A. Total Quality Management (TQM)
NARAYAN CHANGDER
98. Which of the following is NOT the roles of B. Lean operations
an accountant?
C. Just-in-Time (JIT)
A. Supplying goods or services to earn
D. Supply chain
profit.
B. Designing and controlling systems of 104. Where would an accountant find an an-
financial records. nual handbook of accounting principles for
governmental entities?
C. Auditing financial information.
A. on the FASAB website
D. Dealing with third parties.
B. on the GAAS website
99. Principle of conservatism takes into ac-
count: C. on the FASB website
A. all future profit and losses D. on the SEC website
B. all future profits and no losses 105. We have been told that we cannot show
C. all future losses and not profits our asset of motor car at cost in one year
and market value in the next year.What
D. neither profits nor losses of the future accounting concept is being applied?
100. Ben’s barbershop’s balance sheet con- A. consistency
tains no inventory account. This company B. going concern
would be classified as:
C. historical cost
A. Merchandising business
D. prudence
B. Manufacturing business
C. Construction business 106. The process of keeping the financial
records of a business is known as
D. service business
A. accounting.
101. Assuming the dollar’s purchasing power
B. controlling.
is stable
C. financing.
A. Measurement Principle
D. bookkeeping.
B. Monetary Unit Assumption
C. Revenue Recognition Principle 107. Real accounts are related to
D. Objectivity concept A. Assets & liability
102. The process of posting is mostly associ- B. Expenses & losses
ated with C. Debtors & creditors
A. Financial statements D. None of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 121
108. Which of below users considered as Inter- B. A process that aims to communicate
nal user? economic information
PRACTICE BOOK» NOT FOR SALE
A. Owner C. It is the art if recording, classifying
B. Middle management and summarizing
D. none of above
C. Bank
D. Buyer 114. The revenue from business activities and
the expenses associated with earning that
109. When cash is received, the cash account revenue are recorded in the same account-
does what? ing period.
A. Increases A. Matching Principle
B. Decreases B. Periodicity
C. Stays the same C. Historical Cost
D. There is no cash account D. Full Disclosure
110. is prepared at the end of the account- 115. The basic purpose of accounting is to
ing period to show the financial position o A. Provide information for decision-
f business making
A. Profit & loss account B. Compute the applicable income tax
B. Balance sheet C. Comply with state requirements
C. Profit & loss statement D. Determine the net income of a com-
D. Satetment of financial position pany
111. Which of the following will not be 116. Below are the external user of account-
recorded in the books of account? ing information EXCEPT?
A. Sales of goods A. Creditor
B. Quality of staff B. Lembaga Hasil Dalam Negeri
C. Payment of salary C. Shareholders
D. Purchase of goods D. Analysts
117. Resources owned by a company (such as
112. Accounting entries involve a minimum of
cash, accounts receivable, vehicles) are re-
how many accounts?
ported on the balance sheet and are re-
A. 0 ferred to as
B. 1 A. Assets
C. 2 B. Liabilities
D. 3 C. Owner Equity
113. Among the following, which is FALSE D. Equity
with regards to Accountancy Profession 118. the tax which is due on the difference be-
A. A service activity that aims to provude tween the value of a product or service
a qualitative information and the cost of its production
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 122
A. TAV C. owner’s equity
B. VAT D. nothing
C. ATV
124. accounting of transactions involving pub-
D. none of above
lic fund disbursement
119. Which of the following would most likely A. Tax Accounting
be inappropriate to wear to work?
B. Government Accounting
NARAYAN CHANGDER
A. hats or head coverings of any type
B. clothing in non-neutral colors C. Management Accounting
C. shoes with rubber soles D. none of above
D. clothing with holes or tears
125. The use of ethics in making business deci-
120. What is the Accounting Equation? sions.
A. Asset-Liabilities = Owner’s Equity A. business ethics
B. Owner’s Equity + Liabilities = Asset B. revenue
C. Asset-Owner’s Equity = Liabilities C. financial statements
D. All of the above
D. expense
121. Who issues International Financial Re-
porting Standards? 126. What is Profit?
A. The government A. Amounts earned from selling products
or services
B. The International Accounting Stan-
dards Board B. Occurs when expenses are more than
C. The stock exchange revenues
D. The IFRS Advisory Committee C. Amounts earned from revenues less
expenses incurred
122. All expenses for Daniel Hardware for the
month of June need to be compiled and D. none of above
recorded. The chief financial officer needs
to determine if the company has exceeded 127. As of December 31, Ravenclaw Merchan-
its budget. dising Company’s records show the follow-
ing amounts:Purchases P1, 250, 000:Pur-
A. Management Accounting chase Discount P25, 000:Purchase returns
B. Financial Accounting P140, 000. If Ravenclaw Company’s be-
C. Tax Accounting ginning inventory amounted to P375, 000,
the Company’s total Cost of Goods Avail-
D. none of above able for sale is
123. The amount remaining after the value of A. P710, 000
all liabilities is subtracted from the value
of all assets. B. P1, 805, 000
A. asset C. P1, 460, 000
B. liability D. P1, 250, 000
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 123
128. Which of the following financial reports A. Monetary unit assumption
provides estimates of when, where, and
B. Economic entity assumption
how much money will come into and out
PRACTICE BOOK» NOT FOR SALE
of a business next year: C. Time period assumption
A. Balance sheet D. Going concern assumption
B. Cash flow statement
133. Which of the following does not describe
C. Income statement accounting
D. Bank statement A. Language of business
129. The same accounting procedure must be B. Is an end rather than a means to an
followed in the same way in each account- end
ing period.
C. Useful for decision making
A. Consistency
D. Used by businesses, government, non-
B. Materiality profit organizations and individuals
C. Objectivity
134. The assumption that states the records of
D. Conservatism
assets, liabilities, and business activities
130. What did WorldCom do to try to keep its of the entity are kept completely separate
stock price from falling? from the owner as well as from other en-
tities is the
A. It forced employees to buy company
stock. A. going concern assumption
B. It created innovative energy trading B. accrual basis assumption
methods to increase revenue.
C. entity assumption
C. It took out loans but did not report
them on the company’s books. D. period assumption
D. It falsified accounting entries to make 135. Expenses are recorded in the same period
the company appear profitable. as the revenues to which they are related
are earned and recognized
131. The correct Accounting Process is
A. Revenue recognition
A. record, source document, report, ad-
vice B. Expense recognition
B. source document, report, record, ad- C. Full disclosure
vice
D. Historical Cost
C. source document, advice, record, re-
port 136. Preparation of general-purpose financial
D. source document, record, report, ad- statement
vice A. Financial Accounting
132. Which accounting assumption assumes B. Management Accounting
that an enterprise will continue in opera-
C. Tax Accounting
tion long enough to carry out its existing
objectives and commitments? D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 124
137. M/s Future Ltd. has invested Rs 10, 142. Which of the following consider as cur-
000 in the shares of Relicam Industries Ltd. rent asset?
Current market value of these shares is Rs A. Bank loan.
10, 500. Accountant of Future Ltd wants
to show Rs 10, 500 as value investment B. Cash.
in the books of accounts, which accounting C. Fixed deposit.
convention restricts him for doing so? D. Motor vehicle.
A. full disclosure
NARAYAN CHANGDER
143. You own a business. Your business is en-
B. consistency
gaged in buying goods at a wholesale price
C. conservatism and reselling them at retail prices on Face-
D. materiality book. Your business is a
A. service business.
138. Financial Statements are a lens to view
A. Financial performance B. manufacturing business.
B. Business C. merchandising business.
C. Accounting transactions D. monkey business.
D. Creditor’s’ expectations 144. Refers to the assumption that a company
has the resources to continue operating in
139. The journal entry to close Sales is
the foreseeable future.
A. debit Income Summary, credit Sales
A. Partnership
B. debit Sales, credit Income Summary
B. Manufacturing business
C. debit Income Summary, credit owner’s
C. Merchandising business
capital account
D. debit owner’s capital account, credit D. Going concern
Income Summary 145. Development of double-entry bookkeep-
140. Cheque Butts, Invoices, Memos and Re- ing.State the existence of the following
ceipts are all in what stage of the Account- depreciation methods that provided by
ing Process? Saliero in 1915.I. Straight line and re-
ducing methodII. Straight line and sink-
A. stage 4 ing fundIII. Annuity method and unit cost
B. stage 2 methodIV. Reducing and sinking fund
C. stage 1 A. I and III
D. stage 3 B. II and IV
141. You are recording info in the ledger. You C. I, II and III
are posting a debit to an account that al- D. All the above
ready has a debit balance. What do you
do? 146. Which principle/guideline requires the
company’s financial statements to have
A. add
footnotes containing information that is
B. subtract important to users of the financial state-
C. just move the number ments?
D. none of above A. Historical Principle
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 125
B. Business Entity B. Wages paid for building construction
C. Accrual Principle C. Repair expenses of building
PRACTICE BOOK» NOT FOR SALE
D. Adequate disclosure Principle D. Advertisement Expenses
147. Book keeping and accounting
152. In what ways accounting educators CAN-
A. Means same an are used interchange- NOT contribute to the accounting profes-
ably. sion?
B. Does not mean same and are not used
A. Effective teaching
interchangeably.
C. Means both (a) and (b) B. Publishing significant research find-
ings
D. None of the above.
C. Serving as Chief Financial Officer of an
148. Which of the following should be included organization
in any journal entry?
D. Influencing top students in pursuing
A. Either a debit or a credit careers in accounting.
B. Both a debit and a credit
C. A calculation of owner’s equity 153. The following are the objectives of ac-
counting except
D. The total debits and credits for the pe-
riod A. Maintaining accounting Records
149. Accounting affects the different business B. Calculating profit & loss
types because: C. Leads to window dressing
A. Taxes are handled differently based on D. Providing accounting information to
the type of business users
B. Affects the business’ ability to gain
money or capital 154. What organization is responsible for
C. Can affect the initial and recurring maintaining GAAP?
costs of the business A. United States Congress
D. All of the above B. Financial Accounting Standards Board
E. None of the above
C. Internal Revenue Service
150. Building A/C is an example of type D. Sarbanes-Oxley Board
of Account
A. PERSONAL ACCOUNTS 155. Managerial accounting reports focus on
B. REAL ACCOUNTS A. the entire company only.
C. NOMINAL ACCOUNTS B. the sales team.
D. none of above
C. the chief executive officer’s favorite
151. Which of the following is capital expendi- departments.
ture? D. on the company as a whole or as a seg-
A. Wages ment.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 126
156. Which branch of accounting is concerned B. Materiality
with analyzing costs of products or ser- C. Consistency
vices rendered in a business?
D. Monetary Measurement
A. Auditing
B. Cost accounting 161. Which one is NOT a source of income for
the business?
C. Financial Accounting
A. owner wins R1 million on the lottery
D. Management Accounting
NARAYAN CHANGDER
B. income from selling goods
E. Tax Accounting
C. interest income
157. He is known as the father of modern ac- D. rent income
counting.
162. which of the following is not the limita-
A. Henry Fayol tion of accounting
B. Luca Pacioli A. based on accounting conventions
C. Andrea Barbarigo B. evidence of legal matters
D. Jacques Savary C. incomplete information
158. On March 1, Vicente purchased merchan- D. ommision of qualitative information
dise with an invoice price of P270, 000
163. Each of the following is a business ex-
and 2/10, n/30 terms. On March 3, Troy
pense, except payment for
paid P10, 000 transportation cost on the
purchased goods. On March 10, Vicente A. advertising
paid for the merchandise. What was Vi- B. monthly rent
cente’s total cost of the purchased mer-
C. utility bills
chandise?
D. equipment
A. P270, 000
B. P274, 200 164. The type or branch of accounting that gen-
erates reports for the use of external par-
C. P274, 600 ties such as creditors, investors and gov-
D. P280, 000 ernment agencies is known as:
159. Mr Ali would not pay his life insurance A. Financial Accounting
premium by using money from his business B. Managerial Accounting
A. Historical cost C. Tax Accounting
B. Accounting period D. Forensic Accounting
C. Business entity 165. What type of cheques is that which is is-
D. Duality sued by a firm but not deposited to the
bank
160. Financial Statement is unable to show A. Uncredited cheques
whether there is a serious problem with
the workforce of a company. This is main B. Outstanding cheques
limitation of adopting Concept. C. Uncollected cheques
A. Accruals D. Bounced cheques
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 127
166. Financial Accounting focuses on reporting 171. Which of the following is not an example
financial information to of external users?
PRACTICE BOOK» NOT FOR SALE
A. investors A. Department of Trade and Industry
B. CEO of company B. Mr. Mark Lopez, one of the sharehold-
ers of ABC Inc.
C. Federal Government
C. National Appliances, one of the major
D. none of above
suppliers of the Good Buy Trading Center
167. Who are categories as internal user of fi- D. Deborah, one of the loyal customers of
nancial statement? Aling Kikay’s Sari-sari store
A. Shareholder 172. The business or economic entity concept
B. Customer is applicable to
C. Banker A. sole proprietorship form of business
D. Government B. partnership form of business
C. corporate form of business
168. are debts of the business?
D. all of the above
A. assets
B. liabilities 173. Planning, recording, analyzing, and inter-
preting financial information.
C. owners equity
A. Accountants
D. vehicles
B. Accounting
169. What are the three main areas in the C. Account Equation
practice of the accountancy profession?
D. Accounting System
A. Public accounting, private accounting
and managerial accounting. 174. Equipment are an example of an/a ?
B. Auditing, taxation and managerial ac- A. loan
counting B. asset
C. Financial accounting, managerial ac- C. liability
counting and corporate accounting D. owners equity
D. Public accounting, private accounting
and government accounting. 175. Accrual concept is based on:
A. matching principle
170. When is the unadjusted trial balance com-
B. dual aspect principle
pleted?
C. cost principle
A. After a first set of adjusting entries
have been made D. going concern concept
B. before any necessary adjusting en- 176. A tax exempt organization formed for re-
tries have been made ligious, charitable, literary, artistic, scien-
C. as a final step in the accounting cycle tific, or educational purposes.
D. after all adjusting entries have been A. For-profit business
made B. Business entity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 128
C. Corporation 181. A short description of every transaction
made in the journal is called
D. Non-profit business
A. Summary
177. Assets increase on the side?
B. Narration
A. subsidiary
C. Description
B. T-account
D. Remark
C. credit
NARAYAN CHANGDER
D. debit 182. All of the following are assets except
A. Accounts Receivable
178. Is any business that uses components,
parts or raw materials to make a finished B. Buildings
good. C. Supplies expense
A. Merchandising business D. Cash
B. Partnership
183. A business may only report transactions
C. Manufacturing business on accounting books that are specifically
D. Going concern related to company operations, not those
activities that affect the owner personally,
179. Which of the following users of financial is known as which of the following?
information is not considered a creditor of A. separate entity concept
the business?
B. monetary unit concept
A. loan provider, such as a bank A
C. going concern assumption
B. supplier that sells goods to the entity
on credit D. time period assumption
C. A customer that buys goods from the 184. who may need accounting information to
entity on credit decide which products to buy from which
D. A financing company that provides the companies:
entity with machineries on a “rent-to- A. Investors
own” basis
B. Creditors
180. Accounting has a long history. Which of C. Customers
the following is incorrect regarding the his-
tory of accounting? D. Company’s owner
A. Accounting can be traced as far back 185. The types of financial reports businesses
as the prehistoric times. use are:
B. Accounting is as old as civilization and A. Balance Sheet
has evolved in response to economic and
B. Income Statement
social needs of men.
C. Capital Statement
C. Fra Luca Pacioli is the mama of mod-
ern accounting. D. Statement of Cash Flows
D. All of these are correct. E. All of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 129
186. ( 1.5 Relevance of accounting history) D. define the period of time for which we
Which relevance accounting history repre- are reporting
sent the statement below? “Help to bet-
PRACTICE BOOK» NOT FOR SALE
ter understanding and appreciation of the 191. Which term is associated with “left” or
field of accounting and its evolution as a “left-side”?
social science” A. Debit
A. Accounting policy B. Credit
B. Accounting pedagogy C. Plus
C. Accounting practice D. Minus
D. Accounting principle
192. Payment of Rs. 6, 000 as wages to
187. A financial gain, especially the differ- workmen for installation of a machine
ence between the amount earned and the should be debited to:
amount spent in buying, operating, or pro- A. (a) Wages A/c
ducing something.
B. (b) Repairs A/c
A. Capital
C. c) Machinery A/c
B. Partnership
D. none of above
C. Loss
D. Profit 193. These users need accounting information
in evaluating the stability of the business
188. On the bank statement, cash deposited in so far as their job security, future remu-
by the company is known as neration, and career growth and opportu-
A. Credit nities are concerned.
B. Debit A. Employees
C. Liability B. Creditors
D. Expense C. Auditors
189. Mortgage Loan D. Regulatory authorities
A. Asset 194. A formal report that shows what an indi-
B. Expense vidual owns, what an individual owes, and
the difference between the two.
C. None of the two
A. owner’s equity
D. none of above
B. personal net worth
190. The Accounting Entity Assumption is im-
C. net worth statement
portant as it helps to
D. financial statements
A. record, report and value assets that
have occurred and will have an effect in 195. Interest on a bank overdraft is an/a..
the future
A. revenue
B. work out whose financial information
is being assessed B. expenses
C. determine which transactions are in- C. liabilities
cluded or excluded D. capital
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 130
196. Susan is an accountant who always making decisionsIV. Using the accounting
makes sure to keep up-to-date on changes transactions to make properdecisions
in technology, best practices, and regula- A. I and II only
tions. This practice demonstrates which
core ethic of accounting? B. II and IV only
A. professional behavior C. I, II and III only
B. professional competence D. I, III and IV only
NARAYAN CHANGDER
C. integrity 201. The following are decisions made by ex-
ternal users except
D. confidentiality
A. whether to hold or sell investments in
197. The financial statement that reports stocks
the assets, liabilities, and stockholders’
B. whether or not to extend a loan to the
(owner’s) equity at a specific date is the
business
A. Balance Sheet
C. whether to sell goods on credit to the
B. Income Statement business.
C. Statement Of Cash Flows D. whether to obtain additional capital
from outside creditors or to generate it in-
D. none of above
ternally.
198. It is a business that is owned by two
202. Which statement about cost concepts is
or more individuals who entered into a
correct?
contract to carry on the business and di-
vide among themselves the earnings there- A. A past cost is avoidable because is has
from. already been incurred.
A. Partnership B. Period costs are those costs related to
the manufacture of a product.
B. Cooperative
C. Product costs consist of direct materi-
C. Corporation als, direct labour and overhead costs
D. Sole Proprietorship D. Factory overheads can be classied as
direct cots.
199. The company repays the bank that had
lent money to the company. What is the 203. Cash Flow Statement, Income Statement
effect on accounting equation? and Balance Sheet are all in what stage of
A. Inc. in Assets I Dec. in Equity the Accounting Process
B. Dec. in Assets I Dec. in Liabilities A. stage 1
C. Dec. in Liabilities I Dec. in Liabilities B. stage 2
D. none of above C. stage 3
D. stage 4
200. Which of the following statements de-
scribe thepurpose of accounting? I. Keep- 204. It is the branch of accounting that in-
ing proper records of business transaction- volves the careful analysis of economic
sII. Keeping proper control of the finances events and other variables to understand
of a businessIII. Assisting management in their impact on decisions.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 131
A. Accounting education C. Conservatism
B. Cost accounting D. Substance Over Form
PRACTICE BOOK» NOT FOR SALE
C. Accounting research
210. (1.6.2 Harmonization of accounting stan-
D. Tax accounting dards)Some of the obstacles are created
by the through strict national licensing
205. can help protect clients’ confidential
requirements.
information.
A. accountants
A. Identity theft
B. government
B. piracy
C. management
C. licensing infringement
D. anti-virus software D. association
206. Concept:Financial statements are pre- 211. fiscal year
pared with the expectation that business A. A business from which merchandise is
will remain in operation indefinately purchased or supplies or other assets are
A. going concern bought
B. materiality B. an accounting record in which transac-
tions are initially recorded in chronologi-
C. accounting period cycle
cal order
D. matching revenue with expenses
C. an accounting period that is one year
207. Inventory/trading stock is an/a ? long
A. equity D. what a company owes to creditors or
others
B. liabilities
C. assets 212. Resources that are expected to yield fu-
ture benefits are:
D. owners equity
A. Assets
208. Enrique Luis owns the Affordable Living
Furniture Company. He plans to expand B. Revenues
the business to include a new line of patio C. Liabilities
or terrace furniture. What type of user is
D. Owner’s Equity
illustrated in the statement?
A. Manager 213. Riley is an employee of the federal gov-
ernment who studies the financial reports
B. Owner
of major businesses in a specific indus-
C. Investor try. The government’s purpose in assign-
D. Competitor ing this task to Riley is to
A. determine creditworthiness.
209. Inventory is to be valued at the lower of
cost and net realisable value. Which ac- B. search for profitable investments.
counting concept is being applied? C. decide if funds are available for pay
A. Cost raises.
B. Accrual D. identify trends in the industry.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 132
214. Who is Luca Pacioli C. A liability
A. The Father of Accounting D. Capital
B. The Mother of Accounting
220. Accounts Payable
C. Accountant
A. money owed by a company to its cred-
D. The Brother of Accounting itors.
215. the member of the accounting team who B. The total amount of money owed to a
NARAYAN CHANGDER
deals with employees business by a customer
A. sales ledger clerk C. a professional who keeps and or in-
B. purchase ledger clerk spects financial accounts
C. payroll clerk D. planning, recording, analyzing, and in-
D. none of above terpreting financial information and ac-
counts
216. In the basic accounting equation,
equals liabilities plus shareholder equity. 221. An expert says that the value of the man-
agement team of the company is worth
A. value
well over a million dollars yet nothing is
B. assets entered for it in the books.What account-
C. debt ing concept is being applied?
D. balance A. money measurement
B. materiality
217. Usually, due to the technicality of ac-
counting reports, the accountant’s inter- C. substance over form
pretation on the financial statement is
D. dual aspect
needed.
A. Recording 222. Which of the following does NOT fall un-
B. Classifying der purview of management accounting
C. Summarizing A. Financial forecasting
D. Interpreting B. Bookkeeping
218. What is the characteristics of managerial C. Cost accounting
accounting information? D. Internal auditing
A. Accuracy
223. Accounts payable/Douglas’s office sup-
B. Timeliness plies, accounts payable/McKoy equipment
C. Relevance company, and accounts payable/Sully of-
D. All of above fice repair are all classified as:
A. Assets
219. Which term describes an amount owed by
a business? B. Revenue
A. An asset C. Liabilities
B. Owner’s equity D. Owner’s equity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 133
224. Which of the following is not an element 229. The owner invests personal cash in the
of the marketing mix? business. What is the effect on accounting
equation?
PRACTICE BOOK» NOT FOR SALE
A. Place
A. Increase in Assets I Increase in Equity
B. Price
B. Increase in Liabilities I Increase in As-
C. Product sets
D. Purpose C. Decrease in Assets I Increase in Eq-
uity
225. Assets are usually reported on the bal-
ance sheet at which amount? D. none of above
A. Cost 230. Credit balance of $100. Credit entry of
$100. what’s the balance
B. Current Market Value
A. 0
C. Expected Selling Price
B. credit of 100
D. None of These
C. credit of 200
226. What is the similarity of Financial Ac- D. none of above
counting and Managerial Accounting?
231. A collection of all accounts is a
A. Record and report financial informa-
tion from business transactions A. Journal
B. Trial balance
B. Both follows GAAP
C. Ledger
C. Both are required by IRS and SEC
D. Chart of Accounts
D. Both do not have to be done
232. Types of businesses include (select all
227. interested in the financial accounting that apply):
reports of a business. A. Sole Proprietorship
A. CEOs B. Partnership
B. CFOs C. Corporation
C. managers D. Limited Liability Company (LLC)
D. investors 233. The accounting principle that requires rev-
enue to be recorded when earned is the:
228. How would you journalize a transaction
in which you bought supplies with a debit A. Matching principle
card? B. Revenue recognition principle
A. debit Accounts Receivable and credit C. Time period assumption
Supplies D. Accrual reporting principle
B. debit Cash and credit Accounts
234. The listing of all of the accounts available
Payable
for use in a company’s accounting system
C. debit Supplies and credit Cash is known as the
D. debit Supplies and credit Debit Card A. Chart of Accounts
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 134
B. Journal 239. What is the classification of Rent Ex-
C. Ledger pense?
A. Revenue
D. Credit Ledger
B. Expense
235. Which of the following is not a compo-
C. Asset
nent of the operating cycle?
D. Liability
A. Collection of cash from merchandise
NARAYAN CHANGDER
sales 240. The rule that requires financial state-
B. Ordering of merchandise ments to reflect the assumption that the
business will continue operating instead of
C. Purchase of merchandise being closed or sold is:
D. Sale of merchandise A. Going-concern assumption
236. A creditor is most likely to examine a B. Business entity assumption
business’s financial accounting records if C. Objectivity Principle
the business is
D. Cost Principle
A. applying for a bank loan.
B. selecting a new market. 241. takes all transactions from the jour-
nal during a period and moves the informa-
C. selecting a new market. tion to a general ledger.
D. complying with regulations. A. journalizing
237. Name the accounting principle:Credit B. posting
sales were recorded when the goods were C. balancing
dispatched (sent), not when the customer
D. transferring
place the order.
A. Money measurement 242. A motor van broke down in December
2017. The repair bill was not paid until
B. Materiality
2018, yet it was treated as a 2017 ex-
C. Going concern pense.What accounting concept is being ap-
D. Realisation plied?
A. accruals
238. What adjusting journal entry is needed
to record depreciation expense for the pe- B. historical cost
riod? C. realisation
A. a debit to Depreciation Expense; a D. materiality
credit to Cash
243. A financial statement showing the rev-
B. a debit to Accumulated Depreciation; a enue and expenses for a fiscal period
credit to Depreciation Expense
A. trial balance
C. a debit to Depreciation Expense; a
credit to Accumulated Depreciation B. balance sheet
D. a debit to Accumulated Depreciation; a C. income statement
credit to Cash D. worksheet
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 135
244. Organizations that make money avail- 249. A business depreciates some of its lap-
able for investments in innovative enter- tops over a useful life of three years and
prises some of them over a useful life of five
PRACTICE BOOK» NOT FOR SALE
years.What accounting principle is not be-
A. Venture Capitalist
ing applied in this scenario?
B. Loaners
A. Historical cost
C. Shark
B. Accruals
D. Financial investor C. Materiality
245. Zara is the owner of Xara Engineer- D. Consistency
ing Sdn Bhd On 31 July 2014, she took
250. A check may be dishonored for all of the
RM420 from the company to pay her
following except:
monthly electricity bills. Her accountant
wants to record this transaction under ex- A. messy handwriting
penses in the books of the business. B. not enough funds to cover the amount
A. Monetary measurement of the check
B. Going concern C. signature used to sign the check does
not match the signature on the account
C. economic entity
D. check looks like it was altered
D. expenses recognition
251. If both the aspects of a same transaction
246. Cost incurred in its efforts to create rev- appear in one account, it is called entry
enue A. Simple journal entry
A. Expense B. Double
B. Revenue C. Compound
C. Withdrawal D. Contra
D. Liability 252. It is referred to as the T-Account because
the basic form of a ledger is like the letter
247. Qualitative characteristics of accounting
“T”.
information are
A. Accounting
A. Relevance
B. Journal
B. Reliability
C. General Ledger
C. Comparability
D. Book
D. All of theses
253. Owner invests personal cash into busi-
248. A business activity that changes assets, ness
liabilities, or owner’s equity. A. +Owners Equ. (Capital)
A. transaction B. -Asset (Cash)
B. capital C. -Acct. Payable (Capital)
C. business ethics D. -Revenue (Sales)
D. business plan E. +Asset (Cash)
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 136
254. Ommision of paise and showing the D. citizens tend to have greater confi-
round figures in financial statements is dence in the economy
based on
A. conservatism concept 259. If at the end of a period, a company has
$400 in cash, $100 in accounts receivable,
B. consistency concept and $100 in accounts Payable, the post-
C. materiality concept closing trial balance will show worth
D. money measurement concept of debits
NARAYAN CHANGDER
A. $200
255. Tangible Assets do not include:
A. Cash B. 600
B. Stock C. $400
C. Goodwill D. $500
D. Furniture
260. The preparation of adjusting entries is
256. In June, Company X receives the RM5, A. Straightforward because the accounts
000 from Accounts Receivable. What is that need adjustment will be out of bal-
the effect on the accounting equation and ance.
which accounts are affected at Company
X? B. Often an involved process requiring
the skills of a professional.
A. Assets Increase; Owner’s Equity De-
crease C. Only required for accounts that do not
B. No Effect have a normal balance.
C. Assets Increase; Liabilities Decrease D. Optional when financial statements
are prepared.
D. none of above
257. Gopal is our debtor for Rs. 10, 000. He 261. Paid cash on account for supplies
became insolvent and only 60 paise in a A. +Asset (Sales)
rupee is received from him. The balance of
Rs. 4, 000 would be entered to the: B. -Asset (Cash)
A. Debit of Discount A/c C. -Acct. Payable (Supply Store)
B. Credit of Discount A/c D. -Revenue (Sales)
C. Debit of Bad-Debits A/c E. -Acct. Receivable (B. Smith)
D. Credit of Bad-Debits A/c
262. Having high level of means that the
258. When a nation’s standards of financial re- company has earned the trust of its stake-
porting are transparent and effective: holders because it has been consistent in
A. the country’s laws ca be more easily all of its actions, decisions, and character.
violated A. HONEST
B. businesses in the country tend to lose B. INTEGRITY
profits and resources
C. LOYALTY
C. businesses are unable to foster good
relationships with customers D. RESPECT
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 137
263. The overall purpose of accounting is to 268. The activities which involve in both book-
keeping and accounting process are:
A. maintain accurate reports.
PRACTICE BOOK» NOT FOR SALE
A. Classifying and recording.
B. compile the business’s expenses.
B. Recording and analyzing.
C. keep track of sales.
C. Summarizing and interpreting.
D. control the finances of the business.
D. Analyzing and interpreting.
264. It is a type of business organization that
269. Azman as accountant will make sure that
is owned by more than one individual. It
the total in debit side in T-accounts always
is created by operation of law rather than
equal to total in credit side
a contract.
A. Materiality
A. Partnership
B. Duality
B. Corporation
C. Realization
C. Cooperative
D. Conservatism
D. Sole proprietorship
270. Liability which is payable on the occur-
265. Mr. Philip Pines is the owner of a beauty rence of certain event is known as
spa and wellness salon. He bought a resi- A. Long-term liabilities
dential house and lot which he included in
B. Contingent Liability
the balance sheet of a beauty spa and well-
ness salon. This is a violation of account- C. Short-term liabilities
ing principle. D. none of above
A. Business Entity
271. Which of the following did the Sarbanes-
B. Going Concern Oxley Act create?
C. Conservatism A. generally accepted accounting princi-
ples
D. Objectivity
B. the Securities and Exchange Commis-
266. States a company must report the details sion
behind financial statements C. rules for how managers and auditors
A. Business Entity Assumption control and report company finances
B. Going Concern Assumption D. rules for appointing CFOs in public
companies
C. Expense Recognition Principle
D. Full Disclosure Principle 272. by law, an accountant must hold a CPA
designation in order to:
267. What does AGPR stands for? A. examine statements for accuracy and
A. Auditor General Pakistan Revenue compliance
B. choose and develop a company’s ac-
B. Accountant General Pakistan Revenue
counting systems
C. Assistant General Pakistan Railways
C. file a reports with the Securities and
D. Administrative Manager Pakistan Post Exchange Commission
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 138
D. hold a position as a management ac- B. Officers
countant C. Employees
273. According to the cost concept D. Public
A. assets are recorded at lower of cost 278. Creditors of the business want to know
and market value
A. Profitability of the business
B. assets are recorded by estimating the
market value at the time of purchase B. Capability of the business to pay higher
NARAYAN CHANGDER
salaries
C. assets are recorded at the value paid
for acquiring it C. Creditworthiness of the business
D. assets are not recorded D. Employment opportunities
274. What type of accounting method would 279. This principle requires that all relevant
most likely be used by a large business information that would affect the user’s
that has a large number of outstanding understanding and assessment of the ac-
loans and customer charge accounts? counting entity be disclosed in the financial
statements.
A. Check method
A. Adequate Disclosure
B. Accrual method
B. Objectivity
C. COD method
C. Materiality
D. Cash method
D. Disclosure of accounts
275. According to which principle even the pro-
prietor of the business is treated as a cred- 280. A commercial enterprise dedicated to the
itor of the business: purchase or finished goods and their resale
for a profit.
A. going concern
A. Partnership
B. cost principle
B. Manufacturing business
C. business entity principle
C. Merchandising business
D. accounting period principle
D. Service business
276. The unearned rent account has a balance
of P36, 000. If P4, 000 of the P36, 000 281. Which of the following phases in the ac-
is unearned at the end of the accounting counting process comes first?
period, the amount of the adjusting entry A. Interpreting
is B. Recording
A. P4, 000 C. Communicating
B. P40, 000 D. Identifying
C. P32, 000
282. Which of the following is a requirement
D. P36, 000 for a good accounting system:
277. External users of accounting information A. It should be updated annually.
are not: B. It should provide needed information
A. Lenders quickly.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 139
C. It should eliminate the need for an ac- 288. The first entry in accounting process is
countant. A. ledger.
PRACTICE BOOK» NOT FOR SALE
D. It should be replaced every two or
B. financial statement.
three years.
C. journal.
283. One of the following is an example of ma-
D. source of documents.
teriality concept:
A. Purchase of pencil recorded as an ex- 289. Information may become less useful if
pense instead of including in stock there is a delay in reporting it. Which qual-
B. Purchase of car for private use itative characteristic of financial informa-
tion is described by this statement?
C. Purchase of plant for business
A. Comparability
D. Purchase of building to extend the busi-
ness B. Understandability
C. Verifiability
284. Which is the first step of accounting pro-
cess? D. Timeliness
A. Classifying 290. The functions of accounting are
B. analyzing and interpretation A. To ascertain profit or loss
C. recording B. To ascertain the financial position of
D. financial statements. the business
285. Owner withdraws cash for personal use C. To provide information to various par-
ties
A. -Expense (Cash)
D. All of the above
B. +Drawing
C. +Asset (Supplies) 291. Which of the following forms of business
organization offers intangible goods in ex-
D. -Asset (Cash)
change of money or cash?
E. -Expense (Utility)
A. manufacturing business
286. Which of the following is revenue ac- B. merchandising business
count?
C. service business
A. Sales Account
D. online business
B. Machinery Account
C. Salary Account 292. Which of the following is a principle of
GAAP?
D. Loan
A. Accountants should not own stock.
287. Which of the following is not a user of
B. Accounting should be done by an out-
management accounting information?
side firm.
A. Store manager
C. Accountants should hold a business
B. Chief Executive Officer degree.
C. Creditor D. Accounting should be based on objec-
D. Chief Financial Officer tive evidence.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 140
293. skills are the most important for ac- 298. Which is the only financial statement that
countants when presenting their work to does not include “For the year ended”
clients A. Financial position
A. multitasking B. Income statement
B. communication C. Changes in Equity
C. math D. Cash Flow
D. social media
NARAYAN CHANGDER
299. Which of the following is a function of ac-
294. The proprietor is treated as a creditor to counts receivable?
the extent of his capital according to: A. Locating discounts and incentives
A. Cost Concept B. Communicating with investors and
B. Business Entity Concept banks
C. Going Concern Concept C. Monitoring outstanding invoices
D. Materiality Concept D. Paying vendors for services rendered
300. Adrian works at a large bank as an a type
295. A business applies the same depreciation
of accountant. His duties are to prepare
policy to all of its computers. Which ac-
profit and loss statements to show clients
counting principle does this treatment fol-
and potential investors the general finan-
low?
cial health of the bank that he works at.
A. Accruals Which branch of accounting are Adrian’s
B. Comparability duties under?
C. Money measurement A. Auditing
D. Business entity B. Cost accounting
C. Financial accounting
296. Andrews Financial proved Yang Enter-
prises with a $10, 000 loan. Andrews D. Management accounting
Financial is requesting information about E. Tax accounting
the outstanding loans and assets of Yang
Enterprises. 301. Unpresented cheques also referred to as
A. Management Accounting A. Bounced cheques
B. Financial Accounting B. Outstanding cheques
C. Tax Accounting C. Uncredited cheques
D. Uncollected cheques
D. none of above
302. Which of the following is a true state-
297. He is considered the father of modern ac-
ment:
counting.
A. Bookkeeping is the same as account-
A. Luca Pacioli
ing.
B. Jacques Savary
B. Bookkeeping does not use computers.
C. Devin Pascoli C. Bookkeeping is limited to information
D. Amatino Manucci on sales.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 141
D. Bookkeeping records business trans- A. Double entry system
actions.
B. single entry system
PRACTICE BOOK» NOT FOR SALE
303. Which of the following actions would be C. both a and b
most likely to violate a business code of
ethics? D. none of these
A. taking a day off from work for a reason 308. The characteristics of accounting are:
that is not an emergency
A. Recording
B. having a personal conversation with a
fellow employee at work B. Classifying
C. offering to do some of an employee’s C. Summarising
work for them D. All of the above
D. using a computer at work to check
one’s social media accounts 309. An allowance for doubtful debts is based
on the
304. which of the following is one result of
stringent 21st century accounting regula- A. Consistency
tions? B. Objectivity
A. they make accounting simpler C. Matching
B. they make accounting more complex D. Prudence
C. they unify international tax codes
310. It is the process with the basic purpose
D. they address the needs of small busi-
of providing information about economic
nesses
activities intended to be useful in making
305. What is a disadvantage of partnerships? economic decisions.
A. ease of formation A. Accounting
B. owners share responsibilities B. Communicating
C. limited liability C. Bookkeeping
D. possibility of personality conflict D. Recording
306. Why are accurate accounting records im- 311. Which of the following is one of the basic
portant to a business? functions of government accountants?
A. They prevent any financial losses.
A. Government accountants keep track of
B. They show the business how it is do- how government agencies use taxpayers’
ing. money.
C. They increase the return on invest- B. Government accountants file tax re-
ments. turns for government agencies.
D. They give the business an image of suc- C. Government accountants purchase
cess. equipment for Congress.
307. Which system of accounting is more pop- D. Government accountants create busi-
ular ness laws and regulations.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 142
312. All information that might affect the C. account title
user’s interpretation of the profitability D. accounting system
and financial position of a business must
be disclosed (presented) in the financial 317. On June 25, Galing Repair Shop rendered
statements or in the notes to the state- service shop to a client for P600. The ser-
ments vice fee was collected July 4. The book-
A. Revenue Recognition keeper recorded the revenue on June 25.
B. Full Disclosure A. Revenue Recognition
NARAYAN CHANGDER
C. Matching Recognition B. Matching Principle
D. Historical cost C. History Cost
D. Objectivity
313. What is meant by accounts receivable?
A. Money owed to a company by its 318. The Assumptions that the business will
debtors continue to operate in the future and its
records are kept on that basis is the
B. Money owed by a company to its cred-
itors A. Entity assumption
C. Money owed to a company by its em- B. Period assumption
ployees C. Accrual basis assumption
D. Money owed by a company to its ven- D. Going concern assumption
dors
319. is recording, analyzing, and interpret-
314. Which of the following is the definition of ing financial information there off.
Marketing? A. Accounting
A. manufacturing goods for consumption B. Balance Sheet
B. getting goods to where they are C. Income statement
needed
D. revenue
C. finding the money necessary to start
and finance a business 320. Last step of accounting process is:
D. all activities that link producers to con- A. Provide information to various parties
sumers in order that exchanges can be who are interested in business enterprise
made B. Record transactions in the books
315. A type of accounting system in which in- C. To make summary in the form of finan-
formation is processed by hand cial statements
A. manual accounting system D. To classify the transactions under sep-
B. computerized accounting system arate heads in the ledger
C. basic accounting system 321. Which of the following entries records
D. on-hand accounting system the receipt of a utility bill from the water
company?
316. The amount in an account A. Dr. Accounts Payable ; Cr Cash
A. account balance B. Dr. Accounts Payable ; Cr. Utilities
B. accounting Payable
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 143
C. Dr. Utilities Expense ; Cr. Accounts 327. Which type of business organisation has
Payable the following characteristics? -conducts
business separate from its owners-the
PRACTICE BOOK» NOT FOR SALE
D. Dr. Utilities Payable ; Cr. Accounts Re-
ceivable owners have limited liability-the organisa-
tion is a taxable entity
322. Mrs Aidas argues that the method of val-
A. Sole trader
uation inventory on a first-in, first-out
(FIFO) can be converted to a Last-in, first- B. Partnership
out (LIFO) at anytime C. Company/corporation
A. consistency D. None of the above
B. full disclosure
328. Which of the following does not accu-
C. objectivity
rately represent the accounting equation?
D. materiality
A. Assets-Liabilities = Stockholders’ Eq-
323. Accounting shows: uity
A. How much others owe to the business B. Assets-Stockholders’ Equity = Liabili-
B. How much money the business has ties
C. How much the business owes others C. Assets = Liabilities + Stockholders’
Equity
D. All of the above
D. Assets + Liabilities = Stockholders’
E. None of the above
Equity
324. Which of the following are not the inter-
nal user of accounting information? 329. The unspent part of income
A. Manager A. profit
B. Financial institutions B. loss
C. Business owners C. liabilities
D. Current investor D. savings
325. Sky Sdn Bhd paid salary RM1, 000 for 330. Which accounting rules is being applied?
its workers. Financial statements must be prepared in
A. Going concern such a way as to ensure they present a
true and fair view of the financial position.
B. Monetary Unit
A. Comparability
C. Objectivity
B. Relevance
D. Realization
C. Reliability
326. Raising money through selling bonds
notes or mortgages or borrowing direction D. Understandability
from financial institutions
331. Journal entries recorded to update gen-
A. Loans eral ledger accounts at the end of a fiscal
B. Debt Financing period.
C. Investment A. adjusting entries
D. Keep the peace B. closing entries
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 144
C. working entries 336. The purpose of book-keeping in business
is to
D. none of these
A. detect financial difficulties in the busi-
332. It is involved in providing professional ness
services particularly in performing tasks
B. record transactions in a prescribed
by making financial reports regarding the
manner
financial activities of economic entities.
What nature of accounting is it? C. design a system for records in the busi-
NARAYAN CHANGDER
ness
A. An art and science
D. interpret financial statements of the
B. A Discipline business
C. A service activity
337. reflects the assumption that the busi-
D. A Language of Business ness continues operating.
333. The was developed as a result of the A. Going concern assumption
Securities Act and Securities Exchange Act. B. Matching principle
A. Securities and Exchange Commission C. Full disclosure principle
B. Federal Deposit Insurance Corpora- D. Cost principle
tion
338. When a company buys supplies on ac-
C. Federal Reserve Bank
count, the cash account does what?
D. Securities and Exchange Center of A. Increases
America
B. Decreases
334. The decrease in the usefulness of prop- C. Stays the same
erty and equipment as time passes is
called D. There is no cash account
A. Contra-Assets 339. Failure to keep information confidential
B. Consumption could open the door to fraud, identity theft,
and other illegal activities if the informa-
C. Deterioration tion is shared with the wrong parties.
D. Depreciation A. Integrity Standards
335. Why do many accountants create a work- B. Confidentiality of Information
sheet? C. Professional Skill
A. To aid in the process of completing a D. Independence and Objectivity
final balance sheet for the period
340. When a company pays a bill using cash,
B. To aid in the process of completing an the cash account does what?
unadjusted trial balance
A. Increases
C. To aid in the process of completing a
final income statement for the period B. Decreases
D. To aid in the process of completing an C. Stays the same
adjusted trial balance D. There is no cash account
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 145
341. According to the accrual concept of ac- 346. What is Accounting?
counting, financial or business transaction A. Maths
is recorded
PRACTICE BOOK» NOT FOR SALE
B. Accounting is reviewing data and man-
A. when cash is received or paid aging finances for a business
B. when transaction occurs C. Finances for a business
C. when profit is computed D. none of above
D. when balance sheet is prepared 347. The company receives cash from a bank
loan. Liabilities will
342. What type of users does managerial ac-
A. Increase
counting focus on?
B. Decrease
A. Lenders
C. No Effect
B. Potential Investors
D. none of above
C. Company management
348. A company or group of people authorized
D. Current Investors to act as a single entity (legally a person)
and recognized as such in law.
343. A part of PAS 16, it allows industries to
go outside of traditional accounting princi- A. Non-profit business
ples as long as it is infrequent and justifi- B. Business entity
able C. For-profit business
A. Materiality D. Corporation
B. Cost-Benefit 349. Deposit in transit:
C. Industry Practice A. Add to Book Balance
D. Conservatism B. Deduct from Book Balance
C. Add to Bank Balance
344. One operating cycle of a business, which
could be a month, quarter, or year, is com- D. Deduct from Bank Balance
monly referred to as which of the follow- 350. The most common form of business orga-
ing? nization is
A. period A. corporation.
B. round B. sole proprietorship
C. tally C. partnership
D. mark D. cooperative
351. Which of the following major account-
345. This is prepared to check the equality of
ing innovations became popular during the
debits and credits.
1980s?
A. T-Account A. Cloud Computing for the PC
B. Balance Sheet B. Mobile Technology
C. Ledger C. Accounting Software for the PC
D. Trial Balance D. Big Data
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 146
352. Concept:The actual amount paid for mer- A. you are the only boss and you keep all
chandise or other items purchased is the profits.
recorded, even though the value of the as- B. although it is easier to form, it may be
set may be different more difficult to raise financing.
A. unit of measurement C. it has unlimited life.
B. historical cost D. it has limited liability.
C. matching expenses with revenue
358. Business activities can be divided into
NARAYAN CHANGDER
D. consistent reporting specific period such as a month, six months
353. Which of the following is not an asset? or a year. Which of the following account-
ing assumption applied?
A. Motor Vehicle
A. Consistency
B. Loan to buy Equipment
B. Going concern
C. Building
C. Materiality
D. Computer
D. Accounting period
354. The account used to summarize the
owner’s equity in the business. 359. Historical cost, Revenue Recognition,
Matching, and Full Disclosure are
A. Liability Account
A. Accounting Assumptions
B. Summary Account
B. Accounting Constraints
C. Asset Account
C. Accounting Principles
D. Capital Account
D. Qualitative Characteristics
355. Which of the following is a nickname for
the GAO? 360. An accounting system used to apply costs
to similar products that are mass-produced
A. regulatory watchdog in a continuous fashion.
B. public watchdog A. job order costing
C. congressional watchdog B. process costing
D. SEC watchdog C. added value costing
356. The information is if the financial D. just in time costing
statements are objectively prepared and
free from bias (not favoring a particular 361. The difference between assets and liabil-
group over the others). ities
A. complete A. revenue
B. free from error B. expense
C. neutral C. withdrawal
D. none of above D. equity
357. An advantage of a sole proprietorship 362. Assets taken out of a business for the
over the other forms of a business orga- owner’s personal use.
nization is A. liabilities
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 147
B. expenses 368. the characterstics of accounting are
C. assets A. recording
PRACTICE BOOK» NOT FOR SALE
D. withdrawals B. classifying
363. Employees use accounting information to C. summarizing
A. run the business D. all of the above
B. make lending decisions
369. Power Sdn Bhd regularly changes ac-
C. determine a company’s profitability counting methods in order to report a
and profit sharing target amount of net income each year.
D. decide which products to buy from Which accounting concept is not comply by
which companies Power Sdn Bhd?
364. Accounts used to accumulate information A. Accrual
from one fiscal period to the next B. Duality
A. special accounts C. Materiality
B. temporary accounts D. Consistency
C. permanent accounts
370. What is the primary service of CPAs in
D. income summary
public practice?
365. Assets accounts include cash, prepaid in- A. Auditing
surance and
B. Taxation
A. sales
C. Controllership
B. accounts payable
D. Managerial Accounting
C. accounts receivable
D. drawing 371. Understanding accounting regulations is
difficult because
366. Which branch of accounting is primarily
concerned with the preparation of specific A. regulations can be set by local, state,
purpose financial statements for the man- or federal government
agement to base financial decisions on? B. accounting regulations are purposely
A. Auditing vague
B. Financial accounting C. all organizations use different account-
C. Cost accounting ing standards
D. Tax accounting D. every industry has its own set of regu-
lations
E. Management Accounting
367. The target cost for a job using job costing 372. Pertama Sdn Bhd recorded their business
is calculated as: transaction by using Ringgit Malaysia.
A. direct costs + desired profit A. Historical cost
B. expected selling price-direct costs B. accounting period
C. expected selling price-desired profit C. Going concern
D. expected selling price + desired profit D. Monetary measurement
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 148
373. Transferring information from a journal 378. (1.4) Accounting and capitalismWhich of
entry to a ledger account. the following historian argue about the
link between accounting and capitalism? i.
A. posting
Sombartii. Jane Lazariii. Yameyiv. Lom-
B. adjusting bards
C. closing A. i and ii
D. all of these B. i and iii
NARAYAN CHANGDER
C. ii and iii
374. Which of the following are servicesbusi-
ness activities? D. ii and iv
A. Book Store 379. If the total debits and total credits of the
trial balance do not agree, the first step in
B. Lawyer Firm
locating the error is to:
C. Bakery A. re-add the debit and credit columns
D. Tax Consultant Firm B. find the amount you are out of balance
375. These are PRACTICAL CONSIDERATIONS C. make certain you copied the amount
that constrain or modify the application of correctly from the ledger account to the
the general principles. trial balance
D. divide the amount you are out of bal-
A. Accounting Constraints
ance by 2
B. Accounting Principles
380. Accounting is referred to as the “lan-
C. Accounting Assumptions guage of “
D. Qualitative Characteristics A. profit
376. Compliance with filing of income tax B. life
A. Tax Accounting C. accounting
D. business
B. Financial Accounting
C. Auditing 381. which type of report shows a business’s
financial position at a given time?
D. none of above
A. statement of changes in equity
377. How would you journalize a transaction B. income statement
in which you paid on account with an elec-
C. statement of cash flows
tronic funds transfer?
D. balance sheet
A. debit Cash and credit Accounts
Payable 382. Aling gempot sold a piece of cupcake to
her neighbor. Apparently, her customer
B. debit Accounts Payable and credit EFT
is out cash so Aling gempot had to con-
C. debit EFT and credit Accounts Receiv- sider it as credit but still recorded it in her
able books. What concept of accounting was
D. debit Accounts Payable and credit observed?
Cash A. Accrual Accounting Principle
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 149
B. Materiality Principle 388. Sometimes referred to as (NOL), occurs
C. Historical Cost Principle when expenses exceed the income or to-
tal revenue produced for a given period of
PRACTICE BOOK» NOT FOR SALE
D. Monetary Principle time.
383. Attributes of relevance A. Loss
A. Completeness B. Profit
B. Neutrality C. Partnership
C. Confirmatory value D. Going concern
D. Predictive value
389. the person from whom goods are pur-
384. A debt has been written off as bad even chased on credit is known as
if there is still a chance that debtor may
A. debtor
eventually pay it.What concept is being ap-
plied? B. owner
A. prudence C. investors
B. going concern D. creditor
C. materiality
390. Which of the following items has no ef-
D. substance over form fects in owner‘s equity/capital?
385. According to principle of conservatism A. Incurring Expenses
closing stock is valued at:
B. Withdrawals of owner
A. at cost price
C. Acquisition of Land
B. at realisable value
D. Earning Revenue
C. cost price or realisable value
whichever is less 391. Records revenues and expenses in a pe-
D. at real value riod:
A. Going Concern Principle
386. “Debit the Receiver, Credit the Giver” Is
rule for which type of account? B. Historical Cost Principle
A. NOMINAL ACCOUNTS C. Matching Principle
B. REAL ACCOUNTS D. Consistency Principle
C. PERSONAL ACCOUNTS
392. A job cost sheet includes:
D. none of above
A. Direct materials, applied overhead, ad-
387. States a company must record the ex- ministrative costs.
penses in incurred in order to generate the
B. Direct materials, direct labor, applied
revenue report
overhead.
A. Expense Recognition Principle
C. Direct labor, actual overhead, selling
B. Full Disclosure Principle costs.
C. Monetary Unit Assumption D. Direct materials, direct labor, operat-
D. Cost Principle ing costs.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 150
393. Accounting 398. Inventory is recorded at the lower of cost
A. Includes Book keeping or net realizable value rather than the ex-
pected selling price. This ensures profit on
B. Does not include Book keeping the sale of inventory is only realized when
C. May or may not include Book keeping the actual sale takes place.
D. None of these A. Going Concern
394. the main purpose of accounting is to give B. Prudence Concept
NARAYAN CHANGDER
a view of accouting C. Materiality Concept
A. unfair D. History Cost
B. inadequate 399. Which of these is not a fundamental ac-
C. true and fair counting assumption?
D. baised A. going concern
B. consistency
395. Concept of consistency means:
C. accrual
A. all the firm in the same industry should
be identical accounting principles and pro- D. materiality
cedures
400. Users of accounting information are:
B. all principle and procedures of ac-
A. External users
counting are utilised
B. External users and Internal users
C. accounting principles and methods
should remain consistent from one year to C. Subsidiary users
another D. Internal users
D. all of the above
401. Which is NOT accounting process in book-
396. Non current assets can be divided into keeping
categories. A. Classifying
A. Two B. Recording
B. Three C. Interpreting
C. Four D. Summarizing
D. Five 402. Which is NOT one of the four areas of
397. Book keeping managerial accounting?
A. The chief accounting officer of an orga- A. Cost accounting
nization. B. Internal Auditing
B. A check of an organization’s account- C. Planning and Forecasting
ing systems and records. D. Performing a Trial Balance
C. The part of accounting that involves
recording economic transactions and 403. Trade creditors are most interested in
events, either electronically or manually; which accounting information?
also called record keeping. A. Profitability
D. none of above B. Adaptability
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 151
C. Liquidity C. None of the above
D. Ability to continue operations Ability to D. none of above
PRACTICE BOOK» NOT FOR SALE
continue operations
409. When a business owner purchases a new
404. What does SECP stands for? truck on credit for his business, what
impact does this purchase have on his
A. Secondary Exchange Commission of
owner’s equity?
Pakistan
A. it decreases equity
B. State Exchange Commission of Poland
B. it increases equity
C. Securities & Exchange Commission of
Pakistan C. it has no impact on equity
D. Securities & Exchange Commission of D. the impact depends on the situation
Panama
410. Types of business activities are
405. The is one of the main financial A. Services and merchandising
statements and reports revenues and ex-
B. Services and manufacturing
penses for a period of time such as a month
or year. C. Services, manufacturing and merchan-
dising
A. Income Statement
D. none of above
B. Balance Sheet
C. Income Worksheet 411. Equipment is an example of an/a ?
D. Balance Sheet A. loan
B. asset
406. Which of the following is considered to
be a financial statement? C. liability
A. Balance sheet D. owners equity
B. Trial balance 412. Unearned Revenues is what type of ac-
C. Adjusted trial balance count?
A. Asset
D. Journal and ledger entries
B. Liability
407. use a company’s financial information
C. Stockholders’ Equity
and regulations to determine if its financial
statement are in accordance with the rules D. none of above
and regulations.
413. Financial accounting information is char-
A. Government and Tax authorities acterized by all of the following except
B. Regulatory agencies A. It is historical in nature
C. Law makers B. It results from inexact and approxi-
D. competitors mate measures
C. It is factual, so it does not require
408. What is the nature of revenue judgement to prepare
A. CR D. It is enhanced by management’s expla-
B. DR nation.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 152
414. Bookkeeping differs from accounting in C. It is oriented towards the future
which part of process? D. It meaures efficiency and effective-
A. Classifying ness
B. Interpreting 420. A document filed with the secretary of
C. Sumamrizing state or registrar to establish a company
as a corporation, must detail the gover-
D. Recording
nance, structure, objectives, operations,
as well as other major details of the com-
NARAYAN CHANGDER
415. Revenue is recorded at the time goods or
services are sold. pany.
A. Materiality A. Partnership
B. Historical Cost B. Charter
C. Realization of Revenue C. Free Enterprise System
D. Capital
D. none of above
421. internal users of accouting information
416. Goods given away as charity would be
are
credited to
A. potential investors
A. Sales a/c
B. creditors
B. Charity A/c
C. management
C. purchase a/c
D. employees
D. none of above
422. Classification which means posting of
417. Bank reconciliation statement compares a journal entries of one nature at one place
bank statement with is done in book known as
A. Cash Payment Journal A. Ledger
B. Cash Receipt Journal B. Journal
C. Financial Statements C. Passbook
D. Cashbook D. none of above
418. Which of the following user see the credit 423. Owner’s Equity is made up of:
worthiness of the business? A. Capital + Profit + Drawings
A. Owner B. Capital-Loss + Drawings
B. Government C. Capital + Profit-Drawings
C. Creditors D. Capital + Drawings
D. Management 424. A business that performs an activity for
a fee.
419. Characteristics of management account-
ing information include all of the following A. service business
except B. sole proprietorship
A. It is audited by a CPA C. financial statements
B. It must be timely D. creditor
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 153
425. The cost of insuring the owner’s personal 430. According to which principle the same
motor vehicle was not included in the in- accounting methods should be used each
come statement of the business. Which ac- year:
PRACTICE BOOK» NOT FOR SALE
counting principle was applied? A. prudence
A. business entity B. full disclosure materiality
B. going concern C. materiality
C. money measurement D. consistency
D. prudence
431. An amount owed by a business.
426. What is owner’s equity? A. expense
A. The amount of money the owner’s has B. liability
B. The stock options C. asset
C. The assets D. equity
D. The assets minus the liabilities of a
432. Which of the following costs is recorded
business
on the job cost sheet?
427. the state of being secret and/or kept se- A. Direct materials cost
cret B. Direct labor cost
A. confidentiality C. Manufacturing overhead cost
B. code of conduct D. All of the above
C. secret
433. What is the classification of “cash? ”
D. none of above
A. Liability
428. A non-current asset has been recorded in B. Owner’s Equity
the accounts using it purchase price. This
is principle. C. Asset
D. Revenue
A. duality
B. prudence 434. Carl purchased P50, 000 merchandise
from Sartre with terms of 3/10, n/30.
C. realisation
How much discount is Carl entitled to take
D. historic cost if it paid within the allowed discount pe-
429. Krystel is an accountant who assisting riod of 10 days?
clients and companies with their financial A. P500
and income tax statements. She studied B. P1, 000
tax laws and is up-to-date with tax issues.
C. P1, 500
Which branch of accounting does she fall
under? D. P3, 000
A. Auditing 435. Current Liabilities include:
B. Cost accounting A. Outstanding expenses
C. Financial Accounting B. Creditors
D. Management accounting C. Bills Payable
E. Tax accounting D. All of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 154
436. Accountant C. Money Measurement
A. planning, recording, analyzing, and in- D. Going Concern
terpreting financial information and ac-
441. When the book keeping system was in-
counts
troduced by Luca Pacioli
B. a professional who keeps and or in- A. 1000s
spects financial accounts
B. 1100s
C. the costs of operating a business
C. 1300s
NARAYAN CHANGDER
D. money and other valuables belonging
D. 1400s
to an individual or business
442. The account Accounts Receivable is an ex-
437. A company’s senior and middle manage- ample of a(n)
ment use accounting information to:
A. asset
A. make buy, sell or keep decisions re-
B. liability
lated to shares.
C. owner’s equity
B. run the business
D. none of the above
C. determine a company’s profitability
and profit sharing 443. Which of the following was created to
help manage international accounting chal-
D. utilize accounting information to make
lenges in the global economy?
lending decisions
A. International Financial Standards
438. As per dual aspects principle: Group
A. Assets = Liabilities-Capital B. International Accounting Standards
Board
B. Assets = Capital-Liability
C. International Organization for Ac-
C. Assets = Liabilities + Capital
counting
D. Capital = Asset + Liability D. International Council on Accounting
439. A source document is prepared for each Challenge
transaction. 444. If you wanted to sign a check over to a
A. Historical Cost friend, so they can cash it, you would use
a:
B. Going Concern
A. restrictive endorsement
C. Objective Evidence
B. transfer endorsement
D. Accounting Period Cycle
C. blank endorsement
440. The manager of the business wrote on D. special endorsement
a piece of paper that utility expenses
incurred by the business were paid the 445. Which of the following is NOT character-
amount of P2, 222. The bookkeeper istics of company?
asked for the invoice evidencing the pay- A. LImited liability
ment before recording it in journal. B. Need huge capital
A. Objectivity C. SIngle taxation
B. Materiality D. Unlimited life
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 155
446. Which of the following is not a limitation 451. Which column is only found in an ten-
of accounting? column worksheet?
PRACTICE BOOK» NOT FOR SALE
A. Based on accounting conventions A. income statement
B. Evidence in Legal Matters B. adjusted trial balance
C. Incomplete Information C. balance sheet
D. Omission of Qualitative Information D. adjustments
447. Which of the following is true about cer- 452. is the transfer of journalized transac-
tified public accountants (CPAs)? tions to their accounts.
A. CPAs only work in the private sector A. Posting
B. CPAs only work in the public sector B. Recording
C. CPAs work for government agencies C. Updating
and corporations
D. Journalizing
D. CPAs work for small businesses but
not large businesses 453. Capital A/C is an example of type of
Account
448. (U.S. accounts receivable) the member of
the accounting team who deals with sales, A. PERSONAL ACCOUNTS
raises invoices and collects payment. B. REAL ACCOUNTS
A. sales ledger clerk C. NOMINAL ACCOUNTS
B. ledger clerk D. none of above
C. purchase ledger clerk
454. Selling of merchandise, Purchasing of
D. none of above equipment, Collection of money, and Pay-
ing bills are examples of
449. Which of the following groups makes reg-
ular use of a business’s managerial ac- A. Types of Financial Transactions
counting information: B. Generally Accepted Accounting Prac-
A. Managers tices
B. Customers C. Types of Financial Reports used in
Businesses
C. Creditors
D. All of the above
D. Investors
E. None of the above
450. The step-by-step process to record busi-
ness activities and events to keep financial 455. develop standards to address a new busi-
records up to date is ness set up
A. day-to-day cycle A. Accounting Research
B. accounting cycle B. Cost Accounting
C. general ledger C. Tax Accounting
D. journal D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 156
456. How many Accounting Assumptions are 461. conducting lectures on accounting topics
there in the accounting system A. Accounting Research
A. 3 B. Accounting Education
B. 2 C. Cost Accounting
C. 4 D. none of above
D. 1 462. Debit must always equal
NARAYAN CHANGDER
457. All the following are internal users of ac- A. Asset
counting except: B. Expense
A. potential investors C. Credit
B. board of directors D. Revenue
C. employees 463. Which terms are opposites?
D. owners A. profit and income
458. It is a type of business that buys raw ma- B. loss and expenses
terials and processes them into final prod- C. profit and loss
ucts.
D. debt and liabilities
A. Service business
464. A person who organizes and operates a
B. Merchandising business business or businesses, taking on greater
C. Manufacturing business than normal financial risks in order to do
so.
D. Trading business
A. Corporation
459. Obtaining a loan for the purpose of start- B. Business entity
ing a small business
C. Entrepreneur
A. Administration loan
D. Non-profit business
B. Financing
465. A business transaction that involves a
C. Budget
purchase on account is considered to be
D. Financial Statement a(n)
A. cash transaction
460. Liabilities
B. credit transaction
A. an entry for the removal of money from
your account to make a payment or pur- C. investment by the owner
chase a good D. expense transaction
B. an entry for a sum of money received
466. This is technically called bookkeeping
into your account
A. Recording
C. an accounting period that is one year
long B. Classifying
D. what a company owes to creditors or C. Summarizing
others D. Interpreting
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 157
467. Company Three Laser Tech Sdn Bhd B. Mesopotamia
records revenue when products are deliv- C. Ancient Rome
ered and services being performed, even
PRACTICE BOOK» NOT FOR SALE
though cash has not yet been received D. Mauryan Empire
A. going concern 473. Revenues minus expenses equals
B. full disclosure (Revenues-Expenses = )
C. revenue recognition A. Profit
D. accounting period B. Overhead
C. Income
468. Check all applicable:terms for a time pe-
riod of 12 months D. None of the above
A. Fiscal year 474. Types of business ownerships are
B. General Business year A. Sole Proprietorship, Partnership and
C. Accounting year Company
D. Time period year B. Sole Proprietorship and Partnership
469. CPAs can join an organization as C. Partnership and Company
A. Line manager D. none of above
B. Financial Controller 475. Which of the following is an example of
C. Creditor an adjusting entry?
D. Chief Financial Officer A. revenue in the form of products as op-
posed to cash
470. GAAP stands for B. revenue that has been billed and paid
A. Generally Accepted Accounting Proce- C. revenue from a prior accounting pe-
dures riod
B. Generally Accepted Accounting Princi- D. revenue that has been billed but not
ples yet paid
C. Gross Accepted Accounting Proce-
dures 476. Which is not a qualitative characteristics
of Accounting information?
D. generally accepted accounting period
A. Understandability
471. “Debit what comes in, Credit what goes
B. Relevance
out” Is the rule for which type of account?
C. Reliability
A. NOMINAL ACCOUNTS
D. Materiality
B. REAL ACCOUNTS
C. PERSONAL ACCOUNTS 477. Which of these accounts is an asset?
D. none of above A. Owner’s Capital
472. Where have been found first record of ac- B. Supplies
counting? C. Accounts Payable
A. Egypt D. Service Income
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 158
478. Transactions are stated at the value at 483. When completing closing entries hat ac-
which they occurred and are not adjusted count do you NEVER close
at the end. Which accounting principle is
A. Owner’s Drawing
described by this statement?
B. Owner’s Capital
A. Business entity
C. Sales
B. Historical cost
D. Rent Expense
C. Materiality
NARAYAN CHANGDER
D. Going concern 484. When estimating unearned revenues,
what principle applies?
479. Which of the following is not a quali-
tative characteristic of financial informa- A. Conservatism Principle
tion? B. Historical Cost Principle
A. Relevance C. Full Disclosure Principle
B. Comparability D. Consistency Principle
C. Accruals
485. If a business purchases a calculator on ac-
D. Understandability count, the accounts affected by this trans-
action are
480. Preparation of financial statements for
submission to a government regulatory A. Cash in Bank and Accounts Payable
body B. Office Equipment and Accounts Receiv-
A. Financial Accounting able
B. Management Accounting C. Office Equipment and Cash in Bank
C. Government Accounting D. Office Equipment and Accounts
Payable
D. none of above
481. An accountant says that it should have 486. Accounts receivable normally has bal-
fair view of the statement of financial po- ance
sition and should not overstate asset val- A. Debit
ues and profit. This is principle.
B. Credit
A. materiality
C. Negative
B. business entity
D. Tidak ada jawaban yang benar
C. matching / accrual
D. prudence 487. Gale started a business assuming that it
will not enter into a liquidation and the
482. What is the law regulating the practice of business will run forever. Which account-
accountancy in the Philippines? ing principle is followed?
A. R.A. No. 9298 A. Going Concern Principle
B. R.A. No. 9198 B. Business Entity Principle
C. R.A. No. 9828 C. Time Period Principle
D. R.A. No. 9928 D. Conservatism Principle
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 159
488. All of the following account names are as- 493. The accounting period of a business is sep-
set names, except arated into activitiess that help the busi-
ness keep its accounting records in an or-
PRACTICE BOOK» NOT FOR SALE
A. Office Furniture
derly fashion.
B. Accounts Payable
A. Accounting Period Cycle
C. Cash in Bank B. Source Document
D. Equipment C. Fiscal Year
489. This is the set of guidelines and proce- D. None of the Above
dures that constitute acceptable account-
494. Burger Hut is trying to decide if it can re-
ing practice at a given time.
ceive money from the government for pro-
A. Principles of Accounting viding employees with insurance.
B. Generally Accepted Accounting Princi- A. Management Accounting
ples B. Financial Accounting
C. General Accounting Principles C. Tax Accounting
D. Basic Fundamental Principle D. none of above
490. What organization was created by the 495. A company had a receipt of RM989 and
Sarbanes-Oxley Act? correctly prepared its bank deposit slip for
RM989. However, the company recorded
A. Public Company Accounting Oversight
the receipt in its Cash account as RM998.
Board
How is the difference of RM9 handled on
B. Securities and Exchange Commission the bank reconciliation?
C. the auditing review board A. Add to Book Balance
D. Financial Accounting Standards Board B. Deduct from Book Balance
C. Add to Bank Balance
491. External users of financial accounting in-
formation include all of the following ex- D. Deduct from Bank Balance
cept
496. Roof Co. installed solar panels after
A. Investors reading about a grant provided by the
B. Labor unions United States Environmental Protection
Agency.
C. Line managers
A. Management Accounting
D. General public
B. Financial Accounting
492. Liabilities often have the word in C. Tax Accounting
their account title. D. none of above
A. Assets
497. Which of the following account DO NOT
B. Payable includes in owner’s equity?
C. Paid A. Drawing
D. Equity B. Capital
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 160
C. Net profit A. classfying
D. Dividend B. summarizing
498. Which of the following is NOT the pur- C. recording
poses of accounting information? D. interpreting
A. To know the financial status of the or-
ganization. 503. Switching accounting principles every
year would violate the concept.
B. To find out the opportunity of the busi-
NARAYAN CHANGDER
ness. A. prudence
C. Easier reference to user. B. accrual
D. To avoid misleading financial state- C. matching
ments.
D. consistency
499. Obligations (amounts owed) are re-
ported on the balance sheet and are re- 504. What is the purpose of a financial audit?
ferred to as A. to define the accounting practices a
A. Assets company should follow
B. Liabilities B. to ensure that a company’s accounting
C. Debt records are accurate
D. Owner Equity C. to punish accountants for making mis-
takes
500. A component of the code of ethics
wherein all legal requirements of the code D. to determine if a company is profitable
should be met. Any licensing requirements, or not
including but not limited to reporting of fi-
nancial statements, should be done. 505. How did Enron’s management hide the
company’s debts and losses?
A. COMPLIANCE
A. by not following GAAP
B. VALUES
B. by transferring them to subsidiary
C. MANAGEMENT SUPPORT
companies
D. PRINCIPLES
C. by issuing company stock shares
501. Concept:Financial information is reported D. by declaring bankruptcy
for a specific period of time on financial
statements. 506. Communication of economic events is the
A. Matching Expenses with Revenue part of the accounting process that in-
volves
B. Accounting Period Cycle
C. Business Entity A. identifying economic events
D. none of above B. quantifying transactions into dollars
and cents.
502. Data from business documents are ar-
C. preparing accounting reports
ranged and categorized. This is best to
describe: D. recording and classifying information.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 161
507. Enron and Tyco failed primarily because 513. A business financial performance is
they recorded and reported separately from the
owner’s personal financial statement.
PRACTICE BOOK» NOT FOR SALE
A. manipulated accounting procedures
B. did not follow GAAP A. Duality
C. did not provide reports to the SEC B. Business Entity
D. obstructed justice C. Going Concern
508. ‘NSF’ marked in cheque sent back by the D. Objectivity
bank indicates
A. Cheque has been forged 514. The business is assumed to have indefi-
nite life in the absence of evidence to the
B. A bank couldn’t verify the identity
contrary
C. No sufficient money
A. Economic entity
D. A cheque cannot be cashed because
it’s illegal B. going concern
509. External users of Accounting information C. Time period (periodicity of income)
are D. Monetary unit
A. Researchers
515. If a business has assets of $5, 600 and
B. Potential Investors
liabilities of $900, the owner’s equity is
C. Government
A. $6, 500
D. All of the above
B. $900
510. Accounting does not show realizable
value of Assets, this is a C. $4, 700
A. Objective D. $5, 600
B. Importance
516. A very large company would be most
C. Limitation likely to have a(n) at the head of its
D. a & b both accounting department.
511. Anything of value that is owned. A. executive vice president
A. asset B. accounting manager
B. liability C. controller
C. owner’s equity D. chief financial officer
D. expenses
517. Report on the total cost of materials and
512. You earn interest and your money is labor used in the production
available whenever you need it.
A. Government Accounting
A. Notice deposit
B. Call deposit B. Cost Accounting
C. Fixed deposit C. Tax Accounting
D. none of above D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 162
518. Which of the following transactions is not 523. A business or other organization whose
of financial character? primary goal is making money (a profit),
A. Purchase of asset on credit and is concerned with money only as much
as necessary to keep the organization op-
B. Purchase of asset for cash erating.
C. Withdrawing of money by proprietor A. Business entity
from business
B. Non-profit business
D. Strike by Employees
NARAYAN CHANGDER
C. Corporation
519. Which of these events will not be D. For-profit business
recorded on the journal?
524. Paid cash for supplies.
A. A service is performed, but the pay-
ment is not collected on the same day. A. Cash (DR)Supplies (CR)
B. Supplies are purchased. They are not B. Supplies (DR)Cash (CR)
paid for; the company will be billed. C. Supplies (DR)Accounts Payable(CR)
C. A copy machine is ordered. It will be D. They are both debits
delivered in two weeks.
525. What is a similarity between Managerial
D. Electricity has arrived but has not been
Accounting and Financial Accounting?
paid for.
A. Both report to the same group of ac-
520. Owner’s equity decreases on the counting users.
side?
B. Both reporting past financial events.
A. credit
C. Both providing information for deci-
B. debit sion making purposes.
C. payments D. Both using the same accounting stan-
D. liability dards of MASB.
521. A physical count of inventory is usually 526. Which of the following is a positive im-
taken pact of GAAP?
A. At the end of the fiscal year A. accounting practices are simple and
streamlined
B. At the peak of busy season
B. accounting practices are transparent
C. At the start of the fiscal year
and consistent
D. In the middle of the fiscal year C. accounting practices are internation-
522. The expenses should be recorded during ally accepted
the period in which they are incurred as to D. accounting practices are free from
generate revenue, regardless of when the gender bias
transfer of cash occurs.
527. a person, who may or may not be quali-
A. Consistency fied, that records the financial transactions
B. Going concern of a business
C. Accrual A. payroll clerk
D. Matching B. bookkeeper
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 163
C. clerk 533. An attribute of relevance whereby a ma-
D. none of above terial information helps the user verify ful-
filment or non-fulfilment of prior expecta-
PRACTICE BOOK» NOT FOR SALE
528. Recording of business transactions is tion or decision
done in book known as A. Confirmatory value
A. Ledger B. Predictive value
B. Journal C. Comparable value
C. Passbook D. Neutral value
D. none of above 534. Businesses would not be able to deter-
529. What is an asset in accounting? mine if they are meeting their financial
goals without accurate:
A. Anything a company owns, minus liabil-
A. Production plans
ities
B. Marketing plans
B. Anything a company owns, except cash
C. Distribution systems
C. Anything a company owns, including
cash D. Accounting systems
D. Any net worth company owners own, 535. A senior member of the accounting team,
including cash who liaises with company owners / direc-
tors and advises on the financial aspects
530. something is if it is capable of making of any planned action
a difference in a decision
A. clerk
A. timely
B. Management accountant
B. comparable
C. sales ledger clerk
C. relevant
D. none of above
D. understandable
536. Mrs Do has personal properties of
531. a fully qualified accountant, holding cur- amounting to P3 million pesos. One half of
rent certification this was invested in the business called Do
A. AC Laundry Shop and the other half in another
business called Do Convenience Store. Two
B. CA financial reports were prepared by the
C. Accountatnt bookkeeper, one for each business.
D. none of above A. Money Measurement
B. Business Entity
532. (1.5) Relevance of accounting historyHis-
torical research in accounting history will C. Going Concern
include all, except D. Objectivity
A. General history
537. These users require information on risk
B. Critical history and return on investment.
C. Medical history A. Creditors
D. Institutional history B. Investors
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 164
C. Lenders 543. The process of accounting can be de-
D. Customers scribed as:
538. A plan of how much money you expect to A. Classifying, recording, summarizing,
receive and how you expect to spend the analyzing and interpreting
money. B. Interpreting, classifying, analyzing,
A. financial statement summarizing and recording
B. budget
NARAYAN CHANGDER
C. Analyzing, classifying, interpreting,
C. source document recording and summarizing
D. bank statement
D. Recording, classifying, analyzing, sum-
539. The income statement lists all the ac- marizing and interpreting
count balances for the period.
A. revenue and expense 544. A place where financial information is
recorded is called a / an
B. temporary and permanent
C. liability and capital A. account
D. asset and withdrawal B. transaction
540. Alex shows up for a meeting at 9:50, C. sales
even though the meeting does not begin
until 10:00. The first of his co-workers to D. purchases
make it to the meeting does not show up
until 10:05. This action shows Alex’s 545. Which of the following tasks would NOT
A. honesty normallybe carried out by a book-keeper?
B. punctuality I. Keeping the journalII. Extracting the trial
balanceIII. Drawing up the balance shee-
C. respect for diversity tIV. Auditing the accounts
D. accountability
A. I and II only
541. The process of putting financial records in
theiranalysis form is called B. I and III only
A. Accounting C. II and IV only
B. Adjusting
D. III and IV only
C. Record keeping
D. Decision making 546. What is one of the main reasons why
businesses need to keep accurate account-
542. Once an accounting policy is selected, it
ing records?
should be used in the next period and
thereafter. This is in accordance with A. To follow procedures
A. Matching
B. To control expenses
B. Materiality
C. Consistency C. To eliminate risks
D. Historical D. To regulate taxes
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 165
547. When the new investment of a new part- A. General Accounting Office (GAO)
ner exceeds the new partner’s initial cap- B. Financial Accounting Standards Board
ital balance and asset revaluation is not
PRACTICE BOOK» NOT FOR SALE
(FASB)
recorded, who will receive the bonus?
C. Institute of Internal Auditors
A. The new partner
D. Institute of Management Accountants
B. The old and new partners in their new
profit and loss ratio 552. the use of holes in financial law to have
C. The old partners in their new profit and an advantage or to show figures in a de-
loss ratio ceptive way
D. The old partners in their old profit and A. CA
loss ratio B. confidentiality
548. The area of accounting which focuses on C. creative accounting
reporting information to internal users. D. none of above
A. Financial Accounting 553. How would you journalize the establish-
B. Managerial Accounting ment of a petty cash fund?
C. Payroll Accounting A. debit Petty Cash and credit Cash
D. Accounts Payable Accounting B. debit Cash and credit Petty Cash
549. This process refers to the reporting of C. debit Expenses and credit Cash
the information processed in the account- D. debit Petty Cash and credit Capital
ing system to interested users.
554. Which concept (or principle) would re-
A. Measuring quire that data be verifiable, or confirmed
B. Identifying by an independent observer?
C. Communicating A. Cost principle
D. Classifying B. Business Entity Concept
550. You are a business owner. Your business C. Reliability concept
needed additional capital so you obtained D. Going-concern assumption
a loan from a bank. the bank made you
sign a contract promising to repay the loan 555. Concept:The same accounting procedures
after a year. Which of the following ac- must be followed in the same way each
counts is increased? accounting period
A. Accounts payable A. accounting period cycle
B. Notes payable B. objective evidence
C. Accounts receivable C. consistent reporting
D. Notes receivable D. materiality
551. The primary standard-setting body in 556. Create Budgets and make business deci-
the United States tasked with responsibil- sions, Measure performance, and Make in-
ity of ddetermining generally accepted ac- vestment decisions are examples of:
counting principles (GAAP) is the A. Uses of Accounting
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 166
B. Types of Financial Reports 561. As per income tax act, accounting period
is:
C. Types of Financial Transactions
A. from 1st january to 31st december
D. Who uses the information
B. from 1st april to 31st march
E. Generally Accepted Accounting Princi-
ples C. from 1st july to 30th june
D. from Diwali to Diwali
557. Which of the following are the types of
NARAYAN CHANGDER
financial statements1.Statement of Cash 562. Financial reports that summarize the fi-
Flow2.Statement of Comprehensive In- nancial conditions and operations of busi-
come 3.Statement of Financial Position4. ness.
Trial balance
A. capital accounts
A. 1, 2, 3 and 4
B. transactions
B. 1, 2 and 3
C. financial balances
C. 2 and 4
D. financial statements
D. 2, 3 and 4
563. The financial statement that reports the
558. The principles of right and wrong that revenues and expenses for a period of
guide an individual in making decisions. time such as a year or a month is the
A. ethics A. Balance Sheet
B. net worth B. Income Statement
C. assets C. Statement Of Cash Flows
D. proprietors D. none of above
559. A large company purchases a RM 150 564. The accounting process is correctly se-
chair and expenses it immediately instead quenced as
of recording it as an asset and depreciating
A. identification, communication, record-
it over its useful life 10 years
ing.
A. going concern
B. recording, communication, identifica-
B. consistency tion.
C. expenses recognition C. identification, recording, communica-
D. materiality tion.
D. communication, recording, identifica-
560. Which of the following presents the first tion.
three steps in the accounting cycle in the
correct order: 565. Income is measured on the basics of
A. Post, analyze, and journalize A. Entity concept
B. Analyze, post, and journalize B. Accounting period concept
C. Analyze, journalize, and post C. Going concern concept
D. Post, journalize, and analyze D. None of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 167
566. Purchase of goods from X for Cash should B. FASB
be Credited to:- C. IFRS
PRACTICE BOOK» NOT FOR SALE
A. Purchase D. none of above
B. X
572. How many process involved in bookkeep-
C. Cash
ing?
D. none of above
A. 2
567. Due to which principle qualitative trans- B. 3
actions are not recorded in books:
C. 4
A. business entity principle
D. 5
B. money measurement principle
573. If an amount is recorded on the side op-
C. historical cost principle
posite the normal balance side, the account
D. dual aspect principle balance is
568. The entry to establish a $300.00 petty A. unaffected
cash fund is B. correct
A. debit Cash $300, credit Petty Cash C. increased
$300
D. decreased
B. debit Miscellaneous Expense $300,
credit Cash $300 574. Cash purchases were debited to the pur-
C. debit Petty Cash $300, credit Cash chases account and credited to the cash ac-
$300 count. Name the accounting principle:
D. debit Petty Cash $300, credit Miscella- A. Matching
neous Expense $300 B. Money measurement
569. A post-closing trial balance is prepared C. Duality
before D. Consistency
A. Preparing financial statements
575. GAAP stands for:
B. Reversing the accounts
A. Generally Accepted Auditing Proce-
C. Adjusting and closing the books dures
D. Preparing a worksheet B. Generally Accepted Accounting Princi-
ples
570. Journal is a book of entry
A. Secondary C. Generally Accepted Accounting Proce-
dures
B. Original
D. Generally Auditing Accounting Princi-
C. First ples
D. None of these
576. Double entry in accounting means there
571. Which organization set financial account- must be entries for every transac-
ing standards and concepts? tion?
A. GAAP A. two
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 168
B. Three 582. What type of account is Prepaid Expense
C. six A. Expense
D. one B. Current Assets
C. Non-Current Assets
577. Company purchases supplies on account
D. Property, Plant and Equipment
A. Increase cash, decrease supplies
583. Bank inadvertently charged your bank ac-
B. Decrease cash, increase supplies
count for another company’s bank fees.
NARAYAN CHANGDER
C. Increase supplies, increase accounts A. Add to Book Balance
payable
B. Deduct from Book Balance
D. Decrease supplies, decrease accounts
payable C. Add to Bank Balance
D. Deduct from Bank Balance
578. Bought supplies on account
584. The accounting assumption the requires
A. +Asset (Supplies) every business to be accounted for sepa-
B. -Asset (Supplies) rately from other business entities, includ-
ing the owners accounts is known as:
C. +Acct. Payable (Supply Store)
A. Time-period assumption
D. -Asset (Cash)
B. Revenue recognition principle
E. +Expense (Supplies)
C. Cost principle
579. A general Leger/T) has a and D. Business entity assumption
side.
585. What is the basic accounting equation?
A. cash receipt and debtors
A. capital=assets+liability
B. debit and payments
B. assets=capital-liability
C. debit and credit
C. liabilities=assets+capital
D. creditors and debtors
D. assets=liabilities+capital
580. FUNDAMENTAL qualities of useful finan- 586. Bought new equipment with cash
cial information
A. -Expense (Supplies)
A. Relevance
B. +Asset (Cash)
B. Comparability C. +Asset (Equip.)
C. Verifiability D. -Asset (Cash)
D. Faithful Representation E. -Expense (Rent)
581. Stage 1 of the Accounting process is 587. Which idea forms the basis of double-
A. advice entry accounting?
A. For every single transaction, at least
B. record
two accounts will be affected
C. report
B. for every single transaction, only as-
D. source documents sets will be impacted
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 169
C. the stockholder’s equity in a business C. Nominal Account
must equal the liabilities D. Liability Account
PRACTICE BOOK» NOT FOR SALE
D. the assets of a business equal the
stockholder’s equity 593. Which form of business ownership does
the following statement refer to? -
588. The Act requires companies to pro- organized as a separate legal entity-
duce both an internal control report and an enjoys an unlimited life
external audit. A. Sole proprietorship
A. Sarbannes-Oxley B. Partnership
B. Securities and Exchange C. Company
C. Uniform Accounting D. none of above
D. Dodd-Frank
594. Analysis of costs in incurred in operations
589. Term for financial assets, such as funds A. cost Accounting
held in deposit accounts, as well as for
B. Financial Accounting
the physical factors of production; that is,
manufacturing equipment, includes facili- C. Management accounting
ties, including buildings used to produce D. none of above
and store manufactured goods.
595. Which of the following is a responsibil-
A. Service business ity of the Securities and Exchange Commis-
B. Sole proprietorship sion?
C. Capital A. collecting taxes from businesses
D. Profit B. providing advice on how to run compa-
nies more effectively
590. Income from providing services
C. approving the salaries of CEOs in pub-
A. Sales lic companies
B. Current income D. enforcing accounting laws and regula-
C. Rent income tions
D. Intereste income 596. It is a branch of accounting that focuses
on general purpose financial statements.
591. The historical cost principle requires
that when assets are acquired, they be A. Cost accounting
recorded at B. Auditing
A. trade in value. C. Management accounting
B. cost. D. Financial accounting
C. market price.
597. Journals, ledgers and Inventory cards are
D. book value. in what stage of the Accounting process?
592. The rule ‘Debit what comes in Credit A. stage 1
what goes out’ is applicable to:- B. stage 2
A. Personal Account C. stage 3
B. Real Account D. stage 4
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 170
598. The cost of goods or services for a busi- 603. Concept:a business’s records should
ness? never be mixed with an owner’s personal
A. Accounts Payable records and reports
B. Interest A. adequate disclosure
B. business entity
C. Expense
C. objective evidence
D. Liability
D. going concern
NARAYAN CHANGDER
599. Accountants employed in entities in vari-
ous capacity as accounting staff, chief ac- 604. Assets taken out of a business for the
countant or controller are said to be en- personal use of the owner are called
gaged in A. capital
A. Public Accounting B. net loss
B. Government Accounting C. net income
C. Private Accounting D. drawing
D. Financial Accounting 605. By charging depreciation, a business aims
to ensure that the cost of non-current as-
600. Concept:When a business activity is large
sets is spread over the accounting peri-
enough to impact business decisions, it
ods which benefit from their use.Which ac-
should be recorded clearly in the financial
counting principle does this relate to?
statements
A. Separate entity
A. realization of revenue
B. Materiality
B. materiality
C. Accruals
C. unit of measurement
D. Going concern
D. consistent reporting
606. Appropriate when there is no clear ev-
601. An endorsement that gives specific in- idence of how a transaction/situation
structions on what to do with a check is should be accounted for. Anticipate no
called: gain but provide for probable losses
A. special endorsement A. Industry Practice
B. signature endorsement B. Conservatism
C. blank endorsement C. Cost-Benefit test
D. restrictive endorsement D. Materiality
602. The area of practice where CPAs provide 607. When creating a business, the properties
accounting services to several clients on a of the owner must be separated from the
contractual or engagement basis? properties of the business. What concept
A. Public accounting is being identified in the statement given?
B. Private accounting A. Economic Entity Principle
C. Government accounting B. Business Entity Principle
D. Education or academe Education or C. Conservatism Principle
academe D. Objectivity Principle
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 171
608. Which of the following business has un- C. full disclosure
limited liability
D. entity concept
PRACTICE BOOK» NOT FOR SALE
A. Sole trader
B. Limited Liability Partnership 613. The two basic types of cost accounting
systems are:
C. Private Limited Company
D. Public Limited Company A. Job order costing and perpetual cost-
ing.
609. Purpose of an accounting system include
B. Job order costing and customized
all of the following except
product costing.
A. Interpret and record the effects of
business transactions C. Job order costing and periodic costing.
B. Classify the effects of transactions to D. Job order costing and process costing.
facilitate preparation of reports.
614. The limitations of accounting are:
C. Dictate the specific types of business
transactions that the enterprise may en- A. Influenced by personal judgements
gage in
B. Based on historical cost
D. Summarize and communicate the infor-
mation to decision makers. C. Affected by window dressing
610. An equation showing the relationship D. All of these
among assets, liabilities, and owner’s eq-
uity. 615. The simplest business from under which
one can operate a business, is not a le-
A. Accounting System gal entity. It simply refers to a person
B. Accounting Equation who owns the business and is personally
C. Accounting Balance responsible for its debts.
D. Accounting A. Manufacturing business
611. Two employees used a business’s comput- B. Sole proprietorship
erized accounting system to change some C. Going concern
records. They were able to steal $50, 000
from the business because the accounting D. Service business
system lacked which of the following:
616. Aali Company (AC) already use straight
A. Protection from theft and fraud line method to recorded depreciation ex-
B. An affordable price penses and accumulated depreciation ex-
C. A manual system as backup penses. At 2010, AC accountant change
straight line method to sum of digit years
D. Printed financial statements without inform in financial statement
612. The owner of the firm records his medical A. going concern
expenses in the firm’s income statement .
Indicate the principle that is violated. B. consistency
A. cost principle C. full disclosure
B. prudence D. expenses recognition
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 172
617. Where did modern accountant profession B. Conservatism
began
C. Historical cost
A. In London
D. Monetary unit
B. In Scotland
C. In Germany 622. An accounting cycle starts with
D. In Italy A. Ledger
B. Trial Balance
NARAYAN CHANGDER
618. The purpose of accounting is to
A. communicate information to inter- C. Source of documents
ested users so that they can make in- D. Balance Sheet
formed decisions
B. communicate financial and non- 623. A Revenue or income
financial information to interested users A. Increases Asset and Equity/Capital
so that they can make informed decisions
B. Increases Assets and Liabilities
C. communicate non-financial informa-
tion to interested users so that they can C. Increases Assets and Decreases Eq-
make informed decisions uity/Capital
D. none of above D. No Effects
619. It is also called the “book of final entry” 624. Who is Father of accounting and book-
because all the balances in the ledger are keeping
used in the preparation of financial state-
ments. A. Benedetto Cotruglia
A. Accounting B. Chanakya
B. Journal C. Luca Pacioli
C. General Ledger D. none of above
D. Book
625. When cash is paid for insurance,
620. A machine has been bought for $5 000 A. Insurance Expense is credited
and entered in the machine account at
that amount even though it is worth $12 B. Prepaid Insurance is credited
000.What accounting concept is being ap- C. Prepaid Insurance is debited
plied?
D. Prepaid Insurance is credited
A. historical cost
B. dual aspect 626. Transaction & events not capable of be-
ing expressed in terms of money are not
C. prudence
to be recorded in accounting due to
D. realisation
A. Going concern
621. Recognized revenue when it is earned
B. Accounting entity
and recognized expenses when it is in-
curred. C. Money measurement
A. Accrual D. Periodicity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 173
627. When recording the increase and de- A. Suppliers
crease accounts of one transaction, that is B. Government
referred to as
PRACTICE BOOK» NOT FOR SALE
C. Finance department
A. Entries
D. Employee Union
B. Journals
C. Double Entry Accounting 632. Name the accounting principle:The value
of the assets of a business was not re-
D. Double Journaling Entries
duced when the manager of the business
628. Accounts Receivable retired.
A. money owed by a company to its cred- A. Money measurement
itors. B. Realisation
B. a professional who keeps and or in- C. Going concern
spects financial accounts
D. Duality
C. The total amount of money owed to a
business by a customer 633. The assumption that the company will
D. the costs of operating a business continue in operation long enough to carry
out its existing objectives and commitment
629. A bank denies a business owner’s ap- A. Going concern
plication for credit saying, “We feel that
you would be unable to make the monthly B. Consistency
payments because of your other debts.” C. Business entity
What financial report did the bank re-
view? D. Accounting period
A. Budget 634. Anything of value that is owned by the
B. Balance sheet company (such as cash, accounts receiv-
ables, vehicles, etc.) are reported on the
C. Income statement balance sheet and are referred to as
D. Operating budget A. assets
630. Gina has decided that she wants to study B. liabilities
to be an auditor, What should Gina do in C. profit
order to best prepare herself for this posi-
tion? D. income
A. gain a master of business administra- 635. The accounting principle that requires ac-
tion degree counting information to be based on actual
B. gain a master of accountancy degree cost and requires assets & services to be
recorded at the cash amount given in ex-
C. obtain experience in leadership and
change is the:
management
A. Accounting equation
D. complete a one-to two-year super-
vised internship B. Cost principle
631. Which of the following is the internal user C. Going-concern assumption
of accounting information? D. Realization principle
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 174
636. The accounting report of Entity A includes C. No effect
an explanatory note explaining why cer- D. none of above
tain expenses have increased during the
period. This information is considered 641. The practice of is harmful because it
A. quantitative information can reduce and divert revenues and also
threaten the security of accounting sys-
B. qualitative information tems.
C. financial information A. piracy
NARAYAN CHANGDER
D. All of these B. a code of ethics
637. companies can present useful information C. firewalls
in shorter time periods such as years, quar- D. competitive advantage
ters, or months is known as which of the
following? 642. Amount owed by a business
A. separate entity concept A. liability
B. monetary measurement concept B. asset
C. going concern assumption C. capital
D. time period assumption D. account
638. Financial statements contain all informa- 643. This accounting process is the recognition
tion necessary to understand a business’s or non-recognition of business activities as
financial condition. accountable events.
A. Full Disclosure A. Communicating
B. Periodicity B. Identifying
C. Going Concern C. Measuring
D. Objectivity D. Adjusting
639. Early history of accounting A.C Littleton 644. Cash is a(n)
has already lists seven preconditions for
A. expense account
the emergence of the systematic book-
keeping. Choose the correct preconditions B. temporary account
for the emergence of the systematic book- C. liability account
keeping.I. CommerceII. Private propertyIII.
EquitiesIV. Capital D. permanent account
A. I and II 645. What is the term for a facility used by
B. II and III wholesalers or retailers for the receipt,
temporary storage, and redistribution of
C. I, II and IV goods according to the customer orders as
D. All the above they are received?
640. The owner invests personal cash in the A. A warehouse
business. Assets will B. A distribution center
A. Increase C. A piggy-back service
B. Decrease D. A telemarketing facility
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 175
646. Which of the following is a characteristic C. NOMINAL ACCOUNTS
of financial accounting? D. none of above
PRACTICE BOOK» NOT FOR SALE
A. Not mandatory
651. Type of economy where products, prices,
B. Must follow GAAP and services are determined by the mar-
C. Emphasis on relevance of data, rather ket, not the government.
than precision A. Charter
D. Both A and B B. Free enterprise system
647. Revenue is recognized when services are C. Manufacturing business
rendered or when ownership to the goods D. Non-profit business
is transferred to the buyer.
652. A sale for which cash will be received at
A. Revenue Recognition a later date.
B. Historical Cost A. revenue
C. Expense Recognition B. on sale
D. Full Disclosure C. sale on account
648. An Asset is D. withdrawals
A. An asset is a resource currently owned 653. Revenues minus expenses equals:
and controlled by a business as a result of A. Assets
a past transaction
B. Liabilities
B. An asset is a resource owned by a busi- C. Owner Equity
ness as a result of a past transaction
D. Net Income
C. An asset is something that costs
money 654. Unearned revenue occurs when which of
D. none of above the following occurs?
A. company receives cash from a cus-
649. Suggested by the conceptual framework tomer before performing the service
if it becomes necessary to determine if the
B. company pays cash before receiving a
increased cost of complying with an ac-
service from a supplier
counting principle or standard is justified
by the benefit that would result if the pre- C. company pays cash after receiving a
ferred treatment is followed service from a supplier
A. Cost-Benefit D. company receives cash from a cus-
tomer after performing a service
B. Conservatism
C. Industry Practice 655. The purchase of a desk on account will
increase Office Furniture and will also in-
D. Materiality crease
650. Rent A/C is an example of type of A. Cash in Bank
Account B. Accounts Payable
A. PERSONAL ACCOUNTS C. Accounts Receivable
B. REAL ACCOUNTS D. Jon McKvey, Capital
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 176
656. Business transactions are reported in 661. “The value of the assets owned by the
numbers that have common values-that is, business and the debts of the business are
using a common unit of measurement. all measured in dollars and cents.” This
A. Money Measurement statement refers to the
B. Entity Concept A. Accounting period
C. Revenue Recognition B. Going concern
D. Matching Principle C. Money measurement
NARAYAN CHANGDER
D. Business entiry
657. An item retailing for P100, 000, subject
to a trade discount of 25% is paid for 662. How to calculate gross profit on the in-
within the discount period on terms 2/10, come statement?
n/30. What is the amount of payment
made? A. Operating expenses-Sales= Gross
profit
A. P73, 500
B. Sales-Cost of goods sold= Gross
B. P74, 000
profit
C. P75, 000
C. Income-Expenses = Gross profit
D. P100, 000
D. Cost of sales-Sales =Gross profit
658. Sales revenue should be recognised when
goods and services have been supplied; 663. Mrs Jonas a professional designer re-
costs are incurred when goods and ser- ceived RM 1000 cash in October as a reser-
vices have been received. Which account- vation for her services to be performed
ing concept governs the above? in December. she recorded the cash as a
unearned services revenue in account busi-
A. The business entity concept ness
B. The materiality concept A. expenses recognition
C. The accruals concept
B. accounting period
D. The duality concept
C. economic entity
659. Owners’ equity is the same thing as D. revenue recognition
A. gross loss
664. Define the bookkeeping
B. net liabilities
A. It’s a process of classifying, record-
C. gross profit ing and summarizing the business trans-
D. net assets action.
660. Evaluation of the performance of a sale B. Its a process of recording, summariz-
department ing and classifying the business transac-
tions.
A. management accounting
C. It’s a process of classifying, summa-
B. financial Accounting rizing and recording the business transac-
C. Auditing tions.
D. none of above D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 177
665. This principle states that revenue is to be 670. The costs of running the business
recognized in the accounting period when A. liabilities
goods are delivered or services are ren-
PRACTICE BOOK» NOT FOR SALE
dered or performed. B. expenses
A. Materiality C. debts
B. Expense recognition principle D. none of above
C. Revenue recognition principle 671. Which of the following is the most rele-
D. Reveneu recognition principle vant accounting information for taxation
authorities?
666. the set of accounts which are prepared
A. Cash Balance of the firm
each year
B. Book Value of the Fixed Assets
A. code of conduct
C. Credit Sales of the year
B. auditor
D. Profit generated during the year
C. annual financial statements
D. none of above 672. Received cash from owner as investment
667. The life of the business is cut into shorter A. Increase cash & capital
accounting period of 12 months or one B. Decrease cash & capital
year for the purpose of preparing financial C. Increase assets & liabilities
statements
D. Decreases assets & liabilities
A. Going concern
B. Economic entity 673. Which is NOT a professional accounting
bodies in Malaysia?
C. Time period (periodicity of income)
A. Malaysian Accounting Standards
D. Monetary unit Board
668. ‘’ The owner took goods for his own use. B. Malaysian Institute of Accountants
“The transaction is recorded in
C. Inland Revenue Board of Malaysia
A. Cash Account
D. Malaysian Institute of Certified Public
B. Sales Account Accountants
C. Drawing Account
674. One of the detailed rules used to record
D. Bank Account business transaction is
669. Why is accounting called language of busi- A. Objectivity
ness? B. Accruals
A. It can be used to record different C. Going Concern
transactions of the business.
D. Double entry book keeping
B. It serves as a tool for communication
in making decisions for the business. 675. Which of the following is an example of
C. It generates profits for the business. a T-account?
D. It speaks in behalf of the management A. An account that includes only assets
in different business presentations. B. An account that includes only liabilities
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 178
C. An account that includes only cash A. Consistency
transactions B. Going concern
D. An account that includes only owner
C. Money measurement
equity
D. Business entity
676. Accounting tools are
681. What was the CEO of Tyco accused of do-
A. Financial reports, software and pro-
ing?
cesses that help to manage financial op-
NARAYAN CHANGDER
erations. A. hiding debt by transferring it to sub-
B. Accounts in the general ledger that are sidiaries
periodically updated. B. hiding debt by transferring it to sub-
C. Adjusting and closing entries for finan- sidiaries
cial statement preparation. C. using company funds to pay for his lav-
D. There is no such thing ish lifestyle
D. engaging in insider trading
677. Rent collected in advance is an example
of which of the following? 682. Business Owners, Managers of various
A. accrued expense operations, Stakeholders are examples of:
B. accrued revenue A. Uses of Accounting
C. deferred expense (prepaid expense) B. Types of Financial Reports
D. deferred revenue (unearned revenue) C. Types of Financial Transactions
678. (1.6.1 Definitions of international ac- D. Who uses the information for account-
counting)Below shows the area of defi- ing purposes
nition under the concept of universal or E. Generally Accepted Accounting Princi-
world accounting, except ples
A. Institutional history
683. On her way to her cubicle, Penny hears
B. Critical history her manager scolding an intern for making
C. Historiography a mistake. Penny knows that she was the
D. Practice history one who made the mistake, so she goes
to the manager and tells the truth. This
679. A formal arrangement by two or more action shows Penny’s
parties to manage and operate a business A. accountability
and share its profits.
B. punctuality
A. Merchandising business
C. respect for diversity
B. Going concern
D. time management
C. Profit
D. Partnership 684. A record summarizing all the information
pertaining to a single item in the account-
680. When the owner of a business takes ing equation.
goods from inventory for his own per-
sonal use, which of the following account- A. accounting
ing principles should be considered? B. account title
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 179
C. account balance 690. Provides information used internally for
planning, evaluating, analyzing, and con-
D. account
trolling business decisions and operations.
PRACTICE BOOK» NOT FOR SALE
685. What is the classification of Vehicle A. Internal auditing
A. Current Asset B. Financial accounting
B. Current Liability C. Management accounting
C. Non-current asset D. Forensic accounting
D. Non-current liability 691. In accounting, which of the following pay-
ment types is journalized as if it were a
686. Which of the following is NOT ethical cash transaction?
principle of accounting:
A. EFT
A. due care
B. debit card
B. integrity
C. check
C. subjectivity
D. all of these
D. professional behaviour
692. This principle states that acquired assets
687. The owner’s worth after assets are used should be recorded at their actual cost and
to pay all liabilities is the definition of not at what management thinks they are
worth as at reporting date.
A. Owner’s Equity
A. Objectivity
B. Liabilities
B. Materiality
C. Assets
C. Historical Cost
D. none of above
D. Entity concept
688. Report on the spending of government
693. The accounting process involves all of the
funds
following except
A. Government accounting A. identifying economic transactions that
B. Financial Accounting are relevant to the business.
C. Accounting Education B. communicating financial information
to users by preparing financial reports.
D. none of above
C. recording non quantifiable economic
689. The manager of S Danielle’s Enterprises events.
has instructed the accounts clerk to omit D. analyzing and interpreting financial re-
some of the entries totally from the books. ports
This unethical practice is known as:
694. Which of the following would not be con-
A. fraudulent financial reporting
sidered an internal user of accounting data
B. misappropriation of assets for the LMN Company?
C. disclosure A. President of the company.
D. penalities B. Production manager
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 180
C. Merchandise inventory clerk C. payment
D. President of the employees’ labor D. transaction
union
700. What is the nature of expense account?
695. Which of the following transactions is of A. CR
a financial character and will be recorded
in the business? B. DR
A. Goods taken from the business by the C. None of the above
NARAYAN CHANGDER
proprietor for her personal use D. none of above
B. Interviewing the candidates for em- 701. It refers to the process of recording the
ployment accounts or transactions of an entity. It
C. Sale of Household furniture Rs 5, 000 normally ends with the preparation of the
trial balance.
D. Received an order for sales of goods
A. Identifying
696. Managerial accounting is a provision of
B. Communicating
information to the
C. Bookkeeping
A. internal parties
D. Recording
B. external parties
C. statutory bodies 702. In which accounting system, is unscien-
tific method and does not provide complete
D. current and potential investors and detailed records?
697. Which of the following is an economic en- A. Cash System
tity? B. Double Entry System
A. A charitable institution C. Single Entry System
B. A grocery store D. Mercantile System
C. Both A and B
703. If a company paid $6000 in advance for
D. None of the above a year’s worth of insurance, how much
money would need to be adjusted after
698. The description of the relation b/w a
one month?
company’s assets, liabilities, and equity,
stated as Assets = Liabilities + Owner’s A. $1000
Equity is known as: B. $500
A. Income statement equation C. $6000
B. Accounting equation D. $3000
C. Business equation
704. How would you journalize the replenish-
D. Return on equity ratio ment of a petty fund?
699. A is the accounting term for a busi- A. debit Petty Cash and credit Cash
ness deal. B. debit Sales and credit Cash
A. sale C. debit Expenses and credit Cash
B. purchase D. debit Cash and credit Petty Cash
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 181
705. Which of the following pairs increase B. Objectivity concept
with credit entries?
C. Entity concept
PRACTICE BOOK» NOT FOR SALE
A. supplies and retained earnings
D. Stable monetary unit concept
B. rent expense and unearned revenue
C. accounts payable and owner’s capital 711. Which of the following gives a correct
definition ofthe ‘double entry’ system of
D. owner’s capital and owner’s drawings
accounting?
706. Which term is associated with “right” or A. Every account is recorded twice.
“right-side”?
B. Every transaction is concerned with at
A. Debit least twoaccounts
B. Credit C. Every entry is recorded twice.
C. Plus
D. Every two entries are recorded in the
D. Minus same account.
707. Evaluate whether a branch of business 712. Mr Kam purchases a new calculator for
complies with the collection and deposit his office for $10. His accountant has said
policy of the company that it should not be regarded as a non-
A. Auditing current asset. What is principle considered
B. Government Accounting by the accountant?
C. Accounting Research A. Matching / accruals
D. none of above B. consistency
708. The Sales account is a account C. Materiality
A. permanent D. realisation
B. normal 713. A company wrote a check for RM76 and
C. special it cleared the bank for RM76. However,
D. temporary the company recorded the check in its Cash
account as RM67. How is the difference of
709. These are broad, general statements or RM9 handled on the bank reconciliation?
“rules” and “procedures” that serve as A. Add to Book Balance
guides in the practice of accounting
B. Deduct from Book Balance
A. Accounting Principles
C. Add to Bank Balance
B. Accounting Ethics
C. General Accounting Procedures D. Deduct from Bank Balance
D. Professionalism 714. Outstanding checks:
710. This accounting fundamental concept al- A. Add to Book Balance
lows the users to obtain timely informa-
B. Deduct from Book Balance
tion to serve as a basis on making deci-
sions about future activities. C. Add to Bank Balance
A. Periodicity concept D. Deduct from Bank Balance
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 182
715. The accounting term used for the posses- B. net income of $35, 000
sions of the business. C. net income of $14, 000
A. capital D. net loss of $14, 000
B. liabilities
721. A company requires that expenses must
C. assets
be matched with revenue. Which account-
D. none of above ing principle is used?
Career Opportunities in Accounting A. Accrual Accounting Principle
NARAYAN CHANGDER
716.
A. Auditing B. Materiality Principle
B. Preparing Tax Returns C. Going Concern Principle
C. Forensic Accounting D. Matching Principle
D. Financial Planning 722. If accounting information is based on
E. All answers are correct facts and it is verifiable by documents it
has the quality of
717. GAAP is intended to keep accounting
A. Relevance
practices
A. transparent and consistent B. Reliability
B. understandable and simple C. Understandability
C. multi-layered and complete D. Comparability
D. complex and difficult 723. It is the process of objectively evaluat-
ing evidence and expressing an opinion re-
718. Goods Means: garding the correspondence between man-
A. Commodity to be bought and sold agement’s assertions and established cri-
B. Commodity to be used as an asset teria.
C. Commodity to be bought but not to be A. Accounting education
sold B. Auditing
D. All of the above C. Accounting research
719. Which of the following is not recorded in D. Tax accounting
the books of Accounts?
724. what type of transactions do we record
A. Purchase of furniture of Rs.50, 000 in the books of accounts
B. Sale of goods to customers Rs.2, 000 A. monetary nature
C. Rent paid Rs.10, 000 B. social nature
D. Appointment of staff C. cash nature
720. If beginning capital was $25, 000, end- D. political nature
ing capital is $37, 000, and the owner’s
withdrawals were $23, 000, the amount 725. Book-keeping is mainly concerned with:
of net income or net loss for the period A. Recording of financial data
was: B. Designing the systems of summarising
A. net loss of $35, 000 the recorded data
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 183
C. Interpreting the data for internal and 730. Organization established as a seperate
external uses existence for the purpose of taxes, cor-
porations, limited liability companies, and
PRACTICE BOOK» NOT FOR SALE
D. Preparation of financial statements of
the business enterprise sole proprietorships are types of common
726. The final day of the financial year saw A. For-profit business
the passing of a new law which rendered
the goods that we sell illegal and the busi- B. Corporation
ness would have to close down. The ac- C. Non-profit business
countant says that the assets in the fi- D. Business entity
nancial statements cannot be shown at
cost.What accounting concept is being ap- 731. A person or business to whom a liability
plied? is owed.
A. going concern A. proprietor
B. historical cost B. supervisor
C. realisation C. creditor
D. substance over form D. business man
727. The production activities for a customized 732. The name given to an account
product represent a(n):
A. account balance
A. Operation
B. accounting
B. Job
C. account title
C. Unit
D. accounting system
D. Pool
733. Book keeping is concerned with
728. The lessons or skills that a person gains
A. Recording financial data related to
by working in a specific job or occupation
business operations.
is known as
B. Designing for systems recording, clas-
A. certification
sifying and summarising recorded data.
B. training
C. Interpreting data for internal and ex-
C. education ternal users.
D. experience D. All of the above.
729. The branch of accounting that focuses 734. Andrew is searching through company fi-
on the preparation and presentation of fi- nancial transactions to prove to his depart-
nancial statements primarily to external ment the new product led to an increase in
users. sales.
A. Financial accounting A. Management Accounting
B. Management accounting B. Financial Accounting
C. External auditing C. Tax Accounting
D. Tax accounting D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 184
735. A business activity that is defined as the 740. What kind of business is BEST described
planning, recording, analyzing, and inter- by these statements? I am the only owner
preting of financial information. of my business. I take all the risks of do-
A. Retailing ing business. I keep all the profits.
A. Sole proprietorship
B. Wholesaling
B. Partnership
C. Accounting
C. Company
D. Manufacturing
NARAYAN CHANGDER
D. Retail
736. Which accounting concept should be con-
sidered if the owner of a business takes 741. These are the events that affect the en-
goods from inventory for his own personal tity and in which other entities participate.
use? A. Current Events
A. The fair presentation concept B. Internal Events
B. The accruals concept C. Obligating Events
C. The going concern concept D. External Events
D. The business entity concept 742. What entries are in Double-entry book-
keeping
737. Internal users of accounting are:
A. Credit and Debit
A. Potential Investors
B. Left and Right
B. Creditors
C. Loss and Profit
C. Management
D. none of above
D. Employees
743. Hesketh is a stationary business. Clas-
738. The accounting concept that requires fi- sify the following elements:Insurance of
nancial statement information to be sup- office computers
ported by independent, unbiased evidence
other than someone’s opinion is: A. Material
A. Business entity assumption B. Labour
B. Monetary unit assumption C. Overhead
D. none of above
C. Objectivity principle
D. Time-period assumption 744. Expected basic guidelines being followed
in preparing financial statements
739. Because they can affect losses and gains
A. GAAP
when doing business in other countries, in-
ternational accountants need to keep track B. Accounting Assumptions
of C. Modifying Principles
A. gross domestic product growth rates D. Qualitative Characteristics
B. business success rates
745. A decrease in owner’s equity resulting
C. unemployment rates from the operation of a business.
D. exchange rates A. equity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 185
B. ethics 751. These are the purposes of business ethics.
EXCEPT
C. equality
PRACTICE BOOK» NOT FOR SALE
A. They keep workers safe, help trade
D. expense
and interactions between companies re-
746. Accountants refer to an economic event main honest and fair.
as a B. Generally make for better goods and
services.
A. sale
C. Keep the money balance for business.
B. purchase
D. Distinguishing what a company will
C. transaction. and won’t stand for.
D. change in ownership
752. Jessica just started the business that sell
747. What is Bulla school uniform on June 2018. In prepar-
ing the financial reports, she decided to
A. Name of first coins have twelve month financial reporting pe-
B. Authentication token riod. Thus, she instructed her accountant
to prepare the report for the year ended
C. Document confirming authenticity
30 July 2018.
D. none of above A. accounting period
748. The basic accounting equation is As- B. economic entity
sets=Liabilities + C. Going concern
A. Income D. Monetary measurement
B. Owner’s Equity 753. Which of the following is NOT catego-
C. Expenses rized as Financial Statement?
D. Profit A. Balance Sheet
B. Trading Account
749. What is the simplest definition of ac-
counting? C. Trial Balance
D. Income Statement
A. The recording of financial transactions
B. Following generally accepted princi- 754. Based on GAAP, companies must use the
ples same accounting from one period to
the next
C. Presenting information in reports
A. firms
D. Managing all of a company’s finances
B. tools
750. Who utilize accounting information to C. personnel;
make lending decisions: D. principles
A. Investors
755. Journal entries used to prepare tempo-
B. Customers rary accounts for a new fiscal period.
C. Creditors A. closing entries
D. Employees B. adjusting entries
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 186
C. balance entries 760. In this phase, items are sorted and
grouped.
D. none of these
A. Classifying
756. Which type of source document is best
B. Recording
for providing evidence of disbursements of
funds from petty cash? C. Interpreting
A. a credit card receipt D. Summarizing
NARAYAN CHANGDER
B. a supplier invoice 761. Assets should be measured and recorded
on the basis of total cost at the point of
C. a lockbox check image
acquisition.
D. a bank statement
A. Historical Cost
757. (1.6.1 Definitions of international ac- B. Revenue Recognition
counting)An exhaustive list of interna- C. Expense Recognition
tional accounting concepts and theories
was provided by Amenkhienan to include D. Full Disclosure
the following:i. Multinational theory ii.
762. What account would be debited in an ad-
Development theoryiii. Translation theo-
justing entry for prepaid insurance?
ryiv. Historical theory
A. cash
A. i and ii
B. prepaid insurance
B. ii and iv
C. insurance expense
C. i and iii
D. unearned revenue
D. iii and iv
763. Management accounting focuses on
758. Name the accounting principle:Rent for A. reporting financial information to inter-
business premises relating to 20-9 was nal users
not included in the income statement for
20-8. B. reporting financial information to se-
nior level managers
A. Historic cost
C. reporting financial information to hir-
B. Matching ing manager
C. Realisation D. all the above
D. Consistency
764. development of curriculum in accounting
in educational institutions
759. Accountants should make certain that as-
sets are not over valued too highly and li- A. Accounting research
abilities should not be shown at too low B. Tax accountiing
value
C. Accounting Education
A. Materiality
D. none of above
B. Objectivity
765. A formal written document that describes
C. Accrual
the nature of a business and how it will op-
D. Conversatism erate.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 187
A. proprietorship 770. Which of the following is not a sub-field
B. service business of accounting?
PRACTICE BOOK» NOT FOR SALE
C. business plan A. Financial accounting
D. financial statements B. Marketing accounting
C. Management Accounting
766. What was the main purpose of the
D. Cost accounting
Sarbanes-Oxley Act?
A. To create jobs for accountants 771. Which of the following it is assumed that
a business will continue to expand and op-
B. To increase tax revenue for the govern-
erate in the future refer to
ment
A. Consistency.
C. To increase competition in the account-
ing industry B. Going concern.
D. To protect investors from fraud and C. Accounting period.
false financial reporting D. Duality.
767. When Managerial Accounting report is 772. Information provided by a busi-
needed to be prepared? ness:Expenses:R150 000Current in-
A. Once a year come:R140 000
B. Every month A. Profit = R10 000
C. Whenever cost accountant has free B. Loss = R10 000
time C. Liabilities = R150 000
D. Whenever required by manager D. Assets = R140 000
768. The standards and rules that accountants 773. Review whether the financial statements
follow while recording and reporting finan- are presented fairly and in compliance with
cial activities. accounting standards
A. GASP A. Management Accounting
B. GAAP B. financial Accounting
C. GAPA C. Auditing
D. GAGA D. none of above
769. Which of the following is true of the 774. Which one is the internal user?
credit and debit columns in the adjusted A. Potential investor
trial balance?
B. Management of a company
A. the debit should be larger than the C. Creditor
credit
D. none of above
B. the credit should be larger than the
debit 775. Amount earned by performing services or
C. the credit and debit should match selling goods to customers
D. together they should equal the A. Expenses
owner’s equity B. Revenue
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 188
C. Withdrawal C. Mission Statement
D. Liability D. Retail
776. A check endorsement that transfers own- 781. The is the senior manager who is re-
ership to anyone that has possession of sponsible for the overall financial health of
the check is called a: a company.
A. restrictive endorsement A. controller
B. transfer endorsement B. chief operating officer
NARAYAN CHANGDER
C. blank endorsement C. chief financial officer
D. special endorsement D. treasurer
777. What can result from a failure to provide 782. Businesses use the information collected
accurate financial statements to a bank? through the accounting process to prepare
A. The bank may lose trust in the govern- accurate:
ment. A. Balance sheets
B. The bank may fail due to poor planning. B. Purchase orders
C. The bank may experience an increase C. Inventory forms
in defaulted loans.
D. Promissory notes
D. The bank may appear more attractive
than it should. 783. Ghanshyam is a furniture dealer. Which
one of the following will not be recorded
778. The branch of accounting that is primar- in his books?
ily involved in the preparation of financial
A. Purchase of Timber for Rs10, 000
statement is
B. Sofa set worth Rs20, 000 taken to his
A. a. Management advisory services
home
B. b. Financial Accounting
C. Sale of household furniture for Rs20,
C. c. Cost Accounting 000
D. Tax Accounting D. Dinning table of Rs15, 000 given to his
friend as gift
779. Any amounts owed by a business and re-
ported on the balance sheet are referred 784. All of the following are liabilities except:
to as
A. Accounts Payable
A. assets
B. Notes Payable
B. liabilities
C. Salaries Payable
C. profit
D. Revenue Earned
D. expenses
785. A number of users would broadly agree
780. Statement of a firm’s financial position that faithful representation has been
on a particular date including assets, liabil- achieved. Which qualitative characteristic
ities, and owner’s equity of financial information is described by this
A. Balance Sheet statement?
B. Budget A. Comparability
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 189
B. Understandability C. bank statement
C. Verifiability D. deposit slip
PRACTICE BOOK» NOT FOR SALE
D. Relevance
791. Method of determining the minimum
786. Which is NOT a basic type of business sales volume needed to cover all costs
ownership? A. Sherman Act
A. Sole proprietorship B. Stamp Act
B. Partnership C. Break-Even Analysis
C. Company D. Budget
D. Retail
792. In the US, serves as a guide for re-
787. Information is based on actual costs in- porting and interpreting accounting infor-
curred in transactions. mation.
A. Business Entity Concept A. FASB
B. Matching Principle B. GAAP
C. History Cost Principle C. IRS
D. Full Disclosure D. none of above
788. Rob is a CPA who inspects the accuracy 793. Cost of goods manufactured is deter-
and consistency of financial statements mined by
and certifies the accounts done by the ac-
A. Financial accounting
countants of his clients. Which branch of
accounting is Rob doing? B. Cost accounting
A. Auditing C. Managerial accounting
B. Cost Accounting D. Human resource accounting
C. Financial accounting 794. Which of the following are functions
D. Management Accounting of abookkeeper? I. AnalysingII. Inter-
E. Tax accounting pretingIII. PostingIV. Recording
A. II and III only
789. Drive Me Inc. is preparing to disclose pub-
licly the amount of money it has made from B. III and IV only
issuing stocks. C. I, II and III only
A. Management Accounting D. I, II and IV only
B. Financial Accounting
795. What accounting record would summa-
C. Tax Accounting rize a business’s profit or loss for a pre-
D. none of above vious year?
A. Bank statement
790. A record of all the activity in a bank ac-
count is called a: B. Inventory record
A. receipt C. Income statement
B. bank invoice D. Balance sheet
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 190
796. The main purpose of accounting is 801. Recording expenses and revenues in the
A. to account for money so it will not be same period in which they occur..
lost. A. Matching concept
B. to provide information that is useful in B. Historical cost concept
making economic decisions. C. Consistency concept
C. to safeguard the assets of a company. D. Accrual concept
D. to provide a clear view of the state of
NARAYAN CHANGDER
802. Which branch of accounting embraces the
the industry’s economy.
preparation of various tax returns and tax
797. You earn interest and your money is planning necessary to minimize the impact
available after you have given the re- of taxes on the firm?
quired period of notice to the bank. A. Auditing
A. call deposit B. Cost accounting
B. notice deposit C. Financial accounting
C. fixed deposit D. Management accounting
D. cheque deposit E. Tax accounting
798. In Accounting, Goods is defined as: 803. An accounting standard can be ignored if
the net impact of doing so has such a small
A. Items which purchased for own con-
impact on the financial statements that a
sumption.
reader of the financial statements would
B. Items which are purchased for charity. not be misled.
C. Items which are purchased for resale. A. Materiality
D. Items without any defect. B. Objectivity
799. What is a postdated check? C. Full Disclosure
A. a check written with a past date on it D. Conservatism
B. a check that was deposited after 30 804. A business owned by one person.
days A. ethics
C. a check that was cashed the same day B. service business
it was written
C. sale on account
D. a check written with a date in the fu-
D. sole proprietorship
ture
805. Outside of the United States, many coun-
800. Which of the following companies was in-
tries use for their accounting standard.
volved in energy and other resource trad-
ing? A. generally accepted accounting prac-
tices
A. Enron
B. the International Financial Reporting
B. WorldCom
Standards
C. Adelphia C. the international agreement on taxes
D. Arthur Andersen and tariffs
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 191
D. the Common Market accounting meth- 811. the tax which is due on personal earnings
ods A. income tax
PRACTICE BOOK» NOT FOR SALE
806. The person who is employed to record B. VAT
the daily money-related information of the C. bookkeeper
business.
D. none of above
A. accountant
812. This branch of accounting focuses on
B. bookkeeper catering to the information needs of exter-
C. manager nal users.
D. secretary A. Management accounting
B. Financial accounting
807. Which process of the accounting cycle of- C. Auditing
ten requires the most analytical thought?
D. External accounting
A. making a journal entry
813. What type of account is a pretty cash
B. posting transactions to accounts
fund?
C. summarizing the trial balance A. asset
D. preparing the financial statements B. expense
808. Which organization oversees GAAP for C. revenue
governmental organizations? D. liability
A. FASB 814. Which of the following is a specialized
B. GASB field in accounting?
C. SEC A. math accounting
B. not-for-profit accounting
D. FDIC
C. certified public accountant
809. Costs incurred by a business in the pro- D. Internal Revenue Service
cess of earning revenue are known as
815. are specialized accountants who look
A. Assets
for evidence of improper accounting meth-
B. Expenses ods
C. Loss A. forensic accountants
D. none of above B. government accountants
C. public accountants
810. The chronological record (day-by-day) of
D. fraudulent accountants
business transactions.
A. Accounting 816. Which of the following refers to orga-
nized summaries of business’s financial ac-
B. Ledger tivities?
C. Journal A. Financial Statements
D. Book B. Accounting Records
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 192
C. Banking Worksheets C. an electronic funds transfer
D. Balance Sheet D. a debit card
817. Which of the following would NOT be 822. Which of the following is not a business
considered as internal users of accounting transaction?
data for a company? A. Paid salaries and wages amounted to
A. External auditor |10, 000
B. CEO of the company B. Purchase of goods for resale
NARAYAN CHANGDER
amounted to |50, 000
C. President of the company
C. Paid rent for office premises |5, 000
D. Salesman of the company
D. Purchased a LCD for personal use
818. Comparability, timeliness. verifiability,
823. Which of the following is the basic Ac-
and understandability are
counting Equation?
A. fundamental characteristics
A. Assets = Liabilities + Stockholder’s
B. enhancing characteristics or Owner’s Equity
C. modifying principles B. Liabilities = Assets + Stockholder’s
D. accounting assumptions or Owner’s Equity
C. Stockholder’s or Owner’s Equity = Li-
819. It is the area of the accountancy profes- abilities + Assets
sion that encompasses the process of ana-
lyzing, classifying, summarizing and com- D. Assets = Liabilities + Income
municating all transactions involving the 824. An unadjusted balance in cash book is be-
receipt and disposition government funds cause of the result of which error?
and property and interpreting the results
A. Deposit in transit
thereof.
B. The omission of Bank charges
A. Internal Auditing
C. Outstanding cheques
B. Private Accounting
D. Unpresented cheques
C. External Auditing
825. Recording of transaction in ledger is
D. Government Accounting
called as
820. A government accountant would likely A. Journalizing
work for
B. Posting
A. the IRS C. Recording
B. a large corporation D. None of these
C. a nonprofit organization
826. What is expenses?
D. a small business
A. Costs incurred with revenues
821. An amount of cash that a business keeps B. Amounts earned from selling products
on hand for small payments or purchases or services
is called: C. Occurs when expenses are more than
A. petty cash revenues
B. a cash advance D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 193
827. Branch of Accounting that focused on the more applicants from that school. This ac-
allocation of the resources and funds of the tion shows David’s
national government.
PRACTICE BOOK» NOT FOR SALE
A. accountability
A. Government Accounting B. work ethic
B. Tax Accounting C. respect for diversity
C. Management Accounting D. punctuality
D. Auditing
832. The transaction is assumed to be material
828. The business owner paid his son’s tuition or significant when its inclusion or exclu-
fee and the amount paid is not considered sion will have an effect on the decision of
a business transaction. Which of the fol- the user of the information.
lowing concept is being applied? A. Materiality
A. Separate legal entity concept B. Cost-benefit
B. Historical cost concept C. Conservatism
C. Duality concept D. Industry practice
D. Consistency concept
833. The IASB was formed
829. In May, Company X records the trans- A. To establish accounting standards for
action by a debit to Accounts Receivable multinational entities
for RM5, 000 and a credit to Service Rev-
B. To enforce IFRS in foreign countries
enues for RM5, 000. What is the effect
of this entry upon the accounting equation C. To develop accounting standards for
for Company X? countries that do not have their own
standard-setting bodies.
A. Assets Increase; Liabilities Decrease
D. To develop a single set of high quality
B. Assets Increase; Owner’s Equity In-
IFRS
crease
C. Assets Decrease; Owner’s Equity In- 834. Which of the following entities creates an
crease annual handbook of accounting principles
for governmental entities?
D. none of above
A. GAAP
830. A general ledger/T account has a and B. SEC
side.
C. GAO
A. cash receipt and debtors
D. FASAB
B. debit and payments
C. debit and credit 835. An exchange of goods or services with
another party is best called in accounting
D. creditors and debtors a
831. David’s firm has a high school internship A. barter system
program. In the past, most if its applicants B. swapping goods
have been from affluent local high schools.
David decides to do a presentation at a C. a sale
school in a low-income area to encourage D. a transaction
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 194
836. Assets are recorded at their original pur- 841. Which of the following is not one of the
chase price according to the: necessary processes performed in account-
A. Materiality Principle ing in order to provide information that is
useful to interested users?
B. Historical Cost Principle
A. Identifying
C. Cost Benefit Principle
B. Summarizing
D. Consistency Principle
C. Recording
NARAYAN CHANGDER
837. “Accounting information must be pre- D. Counting
sented to the users in time to fulfil their
decision making needs”. This statement is 842. Which branch of accounting deals with
referring to which characteristic of useful the calculate the profit or loss of a busi-
managerial accounting information? ness during a period and to provide an ac-
A. Accuracy. curate picture of the financial position of
the business as on a particular date to in-
B. Cost effectiveness. vestors or banks?
C. Relevance. A. Auditing
D. Timeliness. B. Cost accounting
838. According to principle of conservatism: C. Financial Accounting
A. provision is made for bad and doubtful D. Management accounting
debts
E. Tax accounting
B. depreciation is charged on assets
843. Which of the following accounting con-
C. recording is made of outstanding ex-
cepts means that similar items should re-
penses
ceive a similar accounting treatment?
D. all of the above
A. Going concern
839. Which type of business organization has B. Accruals
the following characteristics? is owned by
C. Matching
2 to 20 personhas unlimited liabilityhas no
legal obligation to audit the accounts D. Consistency
A. sole trader 844. Accounting is important due to following
B. partnership reasons
C. company A. Replacement of memory
D. none of above B. Settlement of tax liability
840. This enhancing quality assures users that C. Legal Evidence
the information faithfully represents the D. Sale of Business
data it intends to communicate. E. All of the above
A. Comparability
845. The process of recording, classifying, an-
B. Verifiability alyzing and interpreting business data is
C. Timeliness called
D. Understandability A. transaction
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 195
B. auditing B. sales ledger clerk
C. accounting C. code of conduct
PRACTICE BOOK» NOT FOR SALE
D. book-keeping D. payroll clerk
846. ( 1.3.4 Politicization phase ( 1973- 851. Paid Cash for water bill
present) )Under Politicization Phase, Fi-
A. Cash (DR)Water bill (CR)
nancial Accounting Standard Board (FASB)
was established by adopted deductive B. Water Bill (CR)Cash (CR)
to the formulation of accounting standard. C. Utilities Expense (DR)Cash (CR)
A. quasi-political D. Both are debits
B. modern-political
852. Which type of business organization has
C. substantive-political a separate legal entity from its owners,
D. sampling-political and the owners are not liable for debts of
business?
847. where ends begins
A. Sole trader
A. book keeping and accounting
B. Partnership
B. accounting and book keeping
C. Limited Company
C. book keeping and finance
D. None of the above
D. finance and accounting
853. Data are checked by
848. Managers need useful information in or-
der to make decisions, to plan and to con- A. External users
trol the company. Therefore, there are B. Internal users
three main components to consider. Which
of the following is not one of those op- C. External users + Internal users
tions? D. None of the answers
A. Planning 854. When should you replenish a petty cash
B. Organising fund?
C. Control A. every week
D. Decision Making B. at the end of the month
849. The primary purpose of accounting is to C. when it has reached a certain dollar
amount
A. stop fraud and neglect D. both at the end of the month and when
it has reached a certain dollar amount
B. generate company profits
C. keep financial records 855. Why would a bank statement not match
business records?
D. report financial information
A. service fees
850. a set of rules (often used within a com-
pany) which show the correct way to be- B. outstanding cchecks
have C. outstanding deposits
A. tax advisor D. all of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 196
856. These users need accounting information 861. According to most large company CFOs,
in order to regulate businesses that are SOX has
within the scope of their legal authority. A. increased fraud
A. Employees B. increased investor confidence
B. Creditors C. decreased company profits
C. Auditors D. decreased stock prices
D. Government regulatory bodies or
862. Which of the following is an advantage
NARAYAN CHANGDER
agencies
of accounting?
857. Which of the following is NOT a financial A. Based on historical cost
statement
B. Omission of qualitative information
A. Income Statement
C. Incomplete information
B. General Journal
D. Detection of errors
C. Balance Sheet
D. Cash flow statement 863. Accounting provides which of the follow-
ing information?
858. A business owns a non-current asset A. Qualitative information
which cost $4, 000 and is recorded at
its carrying amount in the financial state- B. Quantitative information
ments. Which of the following accounting C. Financial information
principles has been applied? D. All of the above
A. Going concern
864. Prime cost is calculated as:
B. Business entity
A. Direct Material+Direct Labour+Direct
C. Consistency Expense
D. Money measurement B. Direct Labour-DirectExpense
859. Bought office furniture on account C. Direct Expense+overheads
A. +Asset (Furniture) D. Direct Cost + Indirect Cost
B. -Revenue (Sales) 865. What is the purpose of promotion?
C. +Acct. Payable (Furniture Store) A. to inform people about products
D. -Revenue (Sales) B. to receive customer feedback
E. +Asset (Furniture) C. to persuade people to buy a product
860. The information includes everything nec- D. to increase competition in market-
essary to reflect what happened for all of place
the business activities for which the firm
is reporting. 866. The firms should use the same accounting
method from period to period to achieve
A. completeness comparability over time within a single en-
B. neutrality terprise. What principle is this?
C. freedom from error A. Consistency Principle
D. verifiability B. Historical Cost
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 197
C. Objectivity 872. What is assets?
D. Reliability A. Cash in the business
PRACTICE BOOK» NOT FOR SALE
867. When a company pays a bill using cash, B. Anything that a creditor has financial
what the effect on its cash account? claim to
A. Increases C. What remains after liabilities are paid
B. Decreases D. any item or property owned by the
business
C. Stays the same
D. There is no cash account 873. A customer saw a carpet in 2017 and
said she might well buy it. She telephoned
868. This is the recording of business data in a in 2018 and asked for the carpet to be
prescribed manner and a mechanical task delivered. The item was not treated as
involving the collection of basic financial a sale in 2017 but was treated as a sale
data. in 2018.What accounting concept is being
A. Bookkeeping applied?
B. Accounting A. realisation
C. Recording B. accruals
D. Summarizing C. prudence
869. Closing entries zero out all accounts. D. going concern
A. permanent 874. Which of the following is not a branch of
B. temporary accounting?
C. capital A. cost accounting
D. asset B. financial accounting
C. book keeping and accounting
870. Which accounting system follows Indian
calendar year from Kartak to Aso? D. management accounting
A. Mercantile system 875. Which of the following is not a character-
B. Desi Nama System istic of accounting?
C. Cash System A. Recording nonmonetary transactions
D. Single Entry System B. Classifying
871. This is the art of recording, classifying, C. Analysing
summarizing in a significant manner and in D. Summarising
terms of money, transactions and events,
which are in part, at least, of financial char- 876. A financial record of sales expenses and
acter and interpreting the results thereof. net profit in a given period
A. Bookkeeping A. mission statement
B. Accounting B. budget
C. Accountancy C. income statement
D. Bookkeeper D. financial statement
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 198
877. Management accounting differs from fi- 882. Which of the following questions can a
nancial in that management accounting is balance sheet help to answer?
concerned mainly with
A. Does the business have too many cus-
A. measuring and reporting financial in- tomers?
formation to external parties
B. Has too much credit been extended?
B. preparing accounts in line with gener-
ally accepted Australain accounting princi- C. Does the business have too many em-
ples ployees?
NARAYAN CHANGDER
C. measuring, analysing and reporting to D. Is the business making the right prod-
business owners ucts?
D. preparing statements for auditing
883. Which of the following describes a public
878. Debit balance of $100. Making an entry accountant?
of a $50 credit. What’s the new balance?
A. Damian is an auditor for an interna-
A. Credit of $50 tional manufacturing company.
B. Debit of $50
B. Jorge is a senior accountant at a non-
C. Credit of $100 profit organization
D. none of above C. Chris is a fraud investigator for the
879. Which of the following is not a correct Government Accountability Office.
variation of the basic accounting equa- D. Natalie prepares and files taxes for in-
tion? dividuals.
A. Assets = Liabilities + Equity
884. This enhancing quality means that the in-
B. Assets-Liabilities = Equity
formation is made available to decision
C. Assets-Equity = Liabilities makers when needed, or in a timely man-
D. Assets + Liabilities = Equity ner to be capable of influencing the users’
decisions.
880. Concept:Revenue is recorded at the same
time goods or services are sold. A. Comparability
A. realization of revenue B. Timeliness
B. the revenue principle C. Verifiability
C. going concern D. Understandability
D. historical cost
885. Which type of adjusting entry is used to
881. Which the items below is non- record a payment a company has not yet
controllable by the head of the production m?
department?
A. accrued expense
A. direct labour working hours
B. insurance of machinery B. deferred expense
C. types of material used in production C. deferred revenue
D. price of material paid to supplier D. accrued revenue
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 199
886. Which of the following is NOT types of 891. What does a supply chain link?
the business units? A. Sellers and Prospects
PRACTICE BOOK» NOT FOR SALE
A. Sole proprietorship B. Consumers and producers
B. Partnership C. Seller and Buyers
C. Corporation D. Manufacturers and Promoters
D. Retailer 892. (CPAs) in accounting satands for
887. Which of the following are incorporated A. Credited period accumulated
in GAAP? B. Certified period accountants
A. Concepts, constraints, and principles C. Certified public accountants
B. Laws, regulations, and policies D. Capital public accounts
C. Requirements, policies, and ideals 893. If the partnership withdraws from the
D. Mandates, laws, and ethics partnership before the end of the account-
ing period, updating of the partnership
888. Which of the following is an internal books is
function of a business’s accounting depart- A. Required
ment? B. Optional
A. administering employee payroll C. Not necessary
B. coordinating accounts receivable D. None of the above
C. coordinating accounts payable 894. what is an asset
D. managing credit and collections ac- A. Something you own
counts
B. your friends property
889. Which of the following is not an external C. your mums money
user of Accounting information? D. Your phone on a plan
A. Researcher
895. Accountants must have strong to vi-
B. Government sualize, communicate, and solve both com-
C. Investor plex and uncomplicated problems.
D. Employees A. analytical skills
B. math skills
890. Providing depreciation an fixed asset is C. organizational skills
in accordance with which of the following
principles/concept . (1) Going concern (2) D. communication skills
Matiching principle (3) Materiality
896. Accounting is
A. 1 and 2 A. An art
B. 2 and 3 B. A science
C. 1 and 3 C. Both an art and a science
D. all the three D. Neither an art nor a science
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 200
897. The method of recording transactions into A. I, II and III
a general journal.
B. I, II and IV
A. Double entry accounting
C. I, III and IV
B. Invoicing
D. )II, III and IV
C. Journalizing
D. Entering 903. Which of the following are the types
of financial statements1.Statement of
NARAYAN CHANGDER
898. Checks, receipts, invoices, and purchase Cash Flow2.Statement of Profit or
orders are examples of Loss3.Statement of Financial Position4.
A. financial statements. Trial balance
B. department ledgers. A. 1, 2, 3 and 4
C. source documents. B. 1, 2 and 3
D. accounting standards. C. 2 and 4
899. A financial statement that reports assets, D. 2, 3 and 4
liabilities, and owner’s equity on a specific
904. In a small company’s accounting depart-
date.
ment, the accounts receivable coordinator
A. balance sheet often takes the role of the
B. income statement A. payroll administrator
C. work sheet B. credit and collection manager
D. post-closing trial balance C. bookkeeper
900. In cash book, the favourable balance indi- D. accounting manager
cates
A. Credit Balance 905. (U.S. accounts payable) the member of
the accounting team who deals with sup-
B. Debit Balance pliers, issues payment for goods and ser-
C. Bank Overdraft vices and keeps track of expenditure
D. Adjusted Balance A. clerk
901. Phone bills, wages and insurance are ex- B. payroll clerk
amples of C. purchase ledger clerk
A. gains D. none of above
B. revenue
906. Accounting is the financial informa-
C. capital tion.
D. expenses
A. Strategy of analyzing
902. Accountants use Generally Accepted Ac- B. Auditing of
counting Principles (GAAP) to make the
C. Planning, recording, analyzing, and in-
financial information communicatedI. rele-
terpreting of
vant II. reliable III. comparable IV prof-
itable D. Reporting of misstated
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 201
907. The difference between personal assets 912. Which of the following items does the
and personal liabilities. statement below describe? “A possible
obligation that arises from past events
PRACTICE BOOK» NOT FOR SALE
A. Personal property
and whose existence will be confirmed
B. Personal Assets only by the occurrence or non-occurrence
C. Personal Net Worth of one or more uncertain future events not
wholly within the entity’s control”
D. Personal Department
A. A provision
908. Floral Avenue is trying to determine if it B. A current liability
has enough cash on hand for a down pay-
ment on a new van. C. A contingent liability
A. Management Accounting D. A contingent asset
B. Financial Accounting 913. Accounting is a service activity and the
function is to provide quantitative informa-
C. Tax Accounting
tion, primarily financial in nature, about
D. none of above economic entities, that is intended to be
useful in making economic decision. This
909. Which accounting concept or principle definition is given by
specifically states that acquired assets
should be recorded at their actual cost? A. ASC
A. Historical cost B. AICPA
B. Prudence C. AAA
D. BOA
C. Business entity
D. Going concern 914. If revenues for the accounting period to-
tal $5, 000, and the expenses total $1,
910. What is primarily centered on the critical 000, then the net income (loss) must total
examination of financial statements by an
A. $6, 000
independent CPA to express an opinion re-
garding the fairness of the contents of the B. $4, 000
financial Statements? C. ($6, 000)
A. auditing D. ($4, 000)
B. cost accounting
915. What is “Deposit in transit” in bank rec-
C. financial accounting onciliation?
D. management accounting A. Added to Bank Balance
E. tax accounting B. Subtracted from Bank Balance
C. Subtracted from the Cash Book Bal-
911. Users of accounting information include
ance
A. Creditors
D. Added to Cash Book Balance
B. Lenders
916. Which of the following makes compar-
C. Customers isons of the financial conditions at multiple
D. All of the above organizations possible:
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 202
A. Bookkeeping 921. Accounting records for a business show
B. Source documents that the week’s total sales revenues were
$125, 000. Cash sales accounted for $50,
C. Accounting standards 000 and credit sales, $75, 000. This is an
D. Trial balance example of
917. Which qualitative characteristic of finan- A. classifying financial information.
cial information can be achieved through B. the cash accounting method.
a combination of consistency and disclo- C. an income statement.
NARAYAN CHANGDER
sure?
D. the accrual method of accounting.
A. Comparability
B. Understandability 922. The system/process that provides infor-
mation about what a business has done
C. Verifiability with the money it has earned.
D. Relevance A. budgeting
918. When preparing Financial Statements B. accounting
which monetary measurement basis states C. bookkeeping
that the accounting records should be
D. none of above
based on the original cost of the transac-
tion. 923. A(n) has at least two owners.
A. Current Value A. Sole Proprietorship
B. Replacement Value B. Partnership
C. Realisation Value C. Company
D. Historical Cost D. Limited company
919. What are the 4 phases of accounting? 924. An attribute of relevance whereby a ma-
A. Recording-Summarizing-Classifying- terial information helps the user make pre-
Interpreting dictions or forecasts about the meaning
and ultimate outcome of the events giving
B. Recording-Classifying-Summarizing-
rise to the information.
Interpreting
A. Predictive value
C. Recording-Interpreting-Summarizing-
Classifying B. Confirmatory value
D. Recording-Classifying-Interpreting- C. Comparable value
Summarizing D. Neutral value
920. Transactions in the records of a business 925. These external users determine the bor-
and the resulting financial statements re- rower’s ability to meet scheduled pay-
flect the affairs of the business not the ments using the accounting information of
affairs of the owners a company.
A. Going concern (continuity) A. Creditors
B. Time period (Periodicity) B. Potential investors
C. Economic entity C. Government and Tax Authorities
D. Monetary D. Competitors
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 203
926. What do you call the simplest type of A. Conservatism
journal?
B. Matching Principle
PRACTICE BOOK» NOT FOR SALE
A. General Journal
C. History Cost
B. General Ledger
D. Going Concern
C. Special Journal
D. Sales Journal 932. Review tax compliance of business
927. Every business is accounted for sepa- A. Financial Accounting
rately from its owner or owners.
B. Accounting Education
A. Business entity assumption
C. Tax Accounting
B. Cost principle
C. Matching principle D. none of above
D. Full disclosure principle 933. Rs. 5, 000 received from Mohan whose
928. A person who is responsible for keeping account was written off as bad in the pre-
all of records of a business. vious year should be credited to:
A. Accountant A. Mohan’s A/c
B. Secretary B. Bad-Debits A/c
C. Bookkeeper C. Bad-Debts Recovered A/c
D. Book keeper
D. None of these
929. In accounts recording is made of:
934. Accounting Cycle includes:
A. Only non financial transactions
B. Only Financial transactions A. Recording, Summarizing, Analyzing,
Classifying and Interpreting
C. Financial and non financial transac-
tions B. Classifying, Recording, Summarizing,
Analyzing and Interpreting
D. Personal transactions of the propri-
etor C. Recording, Classifying, Summarizing,
Analyzing and Interpreting
930. After the stock market crash, the gov-
ernment created the to regulate busi- D. Recording, Summarizing, Classifying,
nesses. Analyzing and Interpreting
A. Internal Revenue Service
935. The development of accounting principles
B. Business Administration Commission in the USAThere are several phases of de-
C. Securities and Exchange Commission velopment accounting principle and theory
D. Stock Market Oversight Board in USA except
A. Management Contribution Phase
931. Bilis Computer Shop purchased P200 pa-
per puncher. The useful life of paper B. Institution Contribution Phase
puncher is 5 years. The bookkeeper ex-
C. Politicization Practice Phase
pense the entire cost of P200 in the year
it is purchased. D. Professional Contribution Phase
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 204
936. How would you journalize a bank service 940. Identify which of the following is the role
charge? of an accountant?
A. debit Miscellaneous Expense and A. Manage and run the business.
credit Cash B. Supplying goods or services to earn
B. debit Accounts Payable and credit profit.
Cash C. To ensure salary increments.
C. debit Cash and credit Service Charge D. Designing and controlling systems of
NARAYAN CHANGDER
financial records.
D. debit Cash and credit Bank Expense
941. The debts of the business.
937. A client agrees to pay a contractor $15,
000 down towards a $45, 000 job. When A. Liabilities
his accountant is journalizing the transac- B. Assets
tion, how much should be posted as ac- C. Expenses
counts receivable?
D. none of above
A. $45, 000
942. Bank reconciliation description is com-
B. $15, 000 posed of
C. $30, 000 A. Bank Accountant
D. $0 B. Business Manager
C. Business Accountant
938. The information is if it is the best
available data that a firm can possibly D. Controller of the bank
present. But it does not mean perfect due 943. Which of the following is not an external
to inherent uncertainties, estimates and user?
assumptions involved in generating the in-
formation. A. Investor
B. Creditor
A. complete
C. Supplier
B. free from error
D. Employee
C. neutral
944. Three activities that Managerial Account-
D. none of above
ing helps managers do:
939. The following costs were incurred in Au- A. Plan
gust:Direct Material RM20, 000Di- B. Act
rect Labour RM18, 000Manufacturing
C. Manage
overhead RM21, 000Selling expenses
RM16, 000Administrative expenses D. Do
RM21, 000 Prime costs during the
945. Due to which of the following, contingent
month totaled:
liabilities are shown in the balance sheet:
A. RM39, 000 A. dual aspect principle
B. RM59, 000 B. principle of full disclosure
C. RM96, 000 C. principle of materiality
D. RM38, 000 D. going concern concept
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.3 Accounting 205
946. Which of the correct sequence of account- 951. A written policy document issued by ex-
ing activities? pert accounting body or body of govern-
ment or regulatory body covering the as-
PRACTICE BOOK» NOT FOR SALE
A. Recording, Identification, Communica-
tion pects of recognition, treatment, measure-
ment, presentation and disclosure of ac-
B. Identification, Recording, Communica- counting.
tion
A. Rule of Conduct
C. Communication, Recording, Identifica-
tion B. Accounting Standard
D. none of above C. Accounting Ethics
D. Accounting Guidelines
947. is recording, classifying, summariz-
ing, analyzing, and interpreting financial 952. At which point in the accounting cycle
information there off. should an acountant prepare the trial bal-
A. Accounting ance?
B. Balance Sheet A. at the end of the cycle only
C. Income statement B. just before preparing the financial
statements
D. revenue
C. at the beginning of the cycle only
948. A forensic accountant is similar to a(n)
D. at any point he or she chooses
because they both work to combat ac-
counting fraud 953. To what account would a debit be posted
A. international accountant if employees worked during a period when
B. auditor they had not yet been paid?
C. general ledger accountant A. service revenue
D. certified public accountant B. salaries payable
C. unearned revenue
949. Bookkeeping is a detail-oriented career
that requires knowledge and skills to do D. salaries expense
the job correctly.
954. Details of a transaction are recorded on
A. Competence a
B. Integrity A. piece of paper
C. Independence B. source document
D. Objectivity C. financial statement
950. After each accounting period, data D. spreadsheet
recorded are summarized through finan-
cial statements. 955. The journal entry to close the expense ac-
counts is
A. Recording
A. debit all expenses, credit owner’s cap-
B. Classifying ital account
C. Summarizing B. debit Income Summary for the total ex-
D. Interpreting penses, credit each expense account
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 206
C. debit each expense account, credit In- 960. Nominal accounts are related to
come Summary for the total expenses A. Assets & liability
D. debit owner’s capital account, credit
B. Expenses & losses
all expenses
C. Debtors & creditors
956. Current assets do not include:
D. None of these
A. (a) Debtors
B. b) Motor car 961. We record in the books of accounts.
NARAYAN CHANGDER
C. (c) Bank Balance A. financial transactions
D. (d) Prepaid Expenses B. no financial transactions
957. A check that has been issued but not re- C. both financial and non financial trans-
ported on a bank statement is called a(n): actions
A. dishonored check D. none of these
B. voided check 962. The Corona Limited Co. has three plants
C. blank endorsement nationwide that cost a total of P200 mil-
D. outstanding check lion. The current fair value of the plants is
P600 million. The plants will be recorded
958. An example of variable cost would be and reported as assets at:
A. depreciation of factory machinery A. P200 M
B. shop rent B. P400 M
C. sales staff commission C. P600 M
D. factory manager’s salary
D. P800 M
959. The owner withdraws cash from the busi-
ness for personal use. Owner’s Equity will 963. Check all applicable:Information is faith-
fully represented if it contains
A. Increase A. completeness
B. Decrease B. neutrality
C. No Effect C. freedom from error
D. none of above D. verifiabiity
1.4 Auditing
1. A deficiency in the firm’s system of quality C. both a and b
control is an indication that: D. neither a nor b
A. the audit engagement was not per-
2. In the planning stage of an audit engage-
formed in accordance with the profes-
ment, the auditor is required to perform
sional standards
audit procedures to obtain an understand-
B. the audit reports issued were not ap- ing of the entity and its environment, in-
propriate cluding its internal control. These proce-
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 207
dures are called C. Petty-shop keepers
A. Risk assessment procedures D. None of the above
PRACTICE BOOK» NOT FOR SALE
B. Substantive tests
8. Failure to include comments may result
C. Tests of controls in the auditee finding other ways of ex-
D. Dual-purpose tests pressing their disagreement with the audit
report, the audit process, and the auditors
3. The planning process involves the follow- themselves
ing, except
A. Auditor
A. *Identifying the tasks to be performed
in the course of an audit B. Auditee
B. *Allocation of those tasks to specific C. Management
auditors D. Client
C. *Deciding when a task should com-
mence 9. What tool can alert you if a server’s pro-
cessor trips a certain threshold?
D. *Qualification of the duration of each
individual task based on the auditor allo- A. TDR
cated B. Password cracker
4. If an auditor is not appointed at annual C. Event Viewer
general meeting, he is appointed by the D. Performance Monitor
A. The Central Government
10. Audire means
B. Board of Directors
A. to write
C. Shareholders
D. Company Law board B. to speak
C. to hear
5. .... auditing is computer assisted auditing
D. None
A. Private
B. Government 11. is the medium through which an audi-
tor expresses his opinion on the state of
C. Electronic
affairs of the client’s business.
D. none of above
A. Audit report
6. Who are the primary financial report users B. Audit certificate
that auditors need to be concerned about?
C. Audit programme
A. Managers of the audited firm
D. Audit planning
B. Banks who provide capital to the firm
C. The general public 12. Management audit otherwise called as
D. Shareholders of the firm A. Financial audit
7. Internal check is suitable for B. Efficiency audit
A. Larger concerns C. Cost audit
B. Smaller concerns D. Cash audit
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 208
13. A good audit planning will help the auditor 17. Quality in internal audit begins with the
to, except: and organization of the audit activity.
A. minimize its risks, A. structure
B. improve audit efficiency B. vision
C. meet its objective at the minimum ef- C. mission
fort D. risk
D. deter fraud 18. Who among the following is eligible to
NARAYAN CHANGDER
appoint an auditor of Government com-
14. When auditors wish to issue an unquali-
pany?
fied opinion but highlight that the entity
changed its method of accounting for soft- A. An individual not passing CA
ware development costs, they would most B. A chartered accountant whether in
appropriately identify the change in ac- practice or not
counting method in which of the follow- C. By C & AG
ing?
D. A chartered accountant in practice
A. the introductory paragraph
19. Which of the following is not a benefit of
B. the opinion paragraph
using IT based controls?
C. an emphasis-of-matter paragraph
A. Ability to process large volumes of
D. an other-matter paragraph transactions
B. Ability to replace manual controls with
15. Which of the following is not an advantage
computer based controls
of the preparation of working paper?
C. Reduction in misstatement due to con-
A. To provide a basis for review of audit
sistent processing of transactions
work
D. Over-reliance on computer generated
B. To provide a basis for subsequent au- reports
dits
C. To ensure audit work is being carried 20. Why it is important for an auditor to act
out as per programme ethically?
A. To make sure client/company are
D. To provide a guide for advising another
happy
client on similar issues
B. To gain trust from public who is the
16. Which of the following factors is most im- user of financial statements
portant in determining the appropriations C. To avoid being penalty by the govern-
of auditevidence? ment
A. The reliability of audit evidence and its D. To make sure the accountant prepare
relevance in meeting the audit objective the financial statement accoridng to finan-
B. The objectivity and integrity of the au- cial reporting standard
ditor
21. What is it means by good board prac-
C. The quantity of audit evidence tices?
D. The independence of the source of ev- A. Board of Directors clearly defined
idence roles and authorities.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 209
B. Planning appropriate Board proce- 26. Intentions to secure unfair or unlawful
dures Gain
PRACTICE BOOK» NOT FOR SALE
C. Implement risk management frame- A. Gain
work
B. Loss
D. Director remuneration in line with best
practice C. Fraud
22. When auditors use documents to support D. None of these
recorded transactions, the process is often
called 27. When the directors of company should ap-
point an auditor?
A. vouching
B. confirmation A. During Emergency General Meeting
C. observation B. Before First Annual General Meeting
D. inquiry C. Every Annual General Meeting
23. Which one of these are the powers of Au- D. After Board of Directors Meeting
dit General?
A. Have powers to CALL UPON any per- 28. is the file containing the records and
son for explanation and information for all data that compromise the audit documen-
records, vouchers, documents and prop- tation for a specific engagement
erties subject to audit. A. Audit file
B. Have powers to ADD or REMOVE the B. Engagement file
details in the financial statements.
C. Working file
C. Have powers NOT to obtain the advice
of law office upon legal matters. D. Client’s file
D. None of the above.
29. Which of the following is the principles of
24. Which of the following underlies the appli- auditing?
cation of generally accepted auditing stan-
A. Due professional care
dards, particularly the standards of field
work and reporting? B. Confidentiality
A. Element of internal control C. Evidence based approach
B. Elements of materiality and risk
D. Objectivity
C. Elements of reasonable assurance
D. Elements of corroborating evidence 30. Auditor unique role is for the following ex-
pertise except for
25. What are the three structural aspects of
accounting that create opportunities for A. Determining proper audit procedure
bias? B. Provide relevant information on eco-
A. Ambiguity, Attachment, Approval nomic event
B. Ambiguity, Approval, Familiarity C. Deciding the number and types of
C. Familiarity, Attachment, Approval items to test evidence
D. Escalation, Ambiguity, Attachment D. Evaluating audit results
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 210
31. how many times the process of re-auditing 36. Who can do audit?
is done
A. Accountant
A. one
B. Manager
B. two
C. Salesman
C. three
D. Auditor
D. four
37. The word ‘Audit ‘ is derived from a Latin
NARAYAN CHANGDER
32. What knowledge auditor need to pos- word ‘’audire” which means
sess?
A. To inspect
A. Accounting knowledge
B. To examine
B. Management knowledge
C. To hear
C. Knowledge about law of a country
D. none of above
D. Knowledge to gather and evaluate evi-
dence 38. Which of the following requires a base-
line? (Select the two best answers.)
33. The auditor is required to comply with all
PSAs relevant to the audit of an entity’s A. Behavior-based monitoring, Anormaly-
financial statements. A PSA is relevant to based monitoring
the audit when:I. The PSA is in effect.II. B. Performance monitor, Anormaly-
The circumstances addressed by the PSA based monitoring
exist.
C. Anormaly-based monitoring, Signarure-
A. I only based monitoring
B. II only D. Signarure-based monitoring, Behavior-
C. Either I or II based monitoring
D. Both I and II
39. The main object of an audit is
34. What kind of security control do computer A. Expression of opinion
security audits fall under?
B. Detection and Prevention of fraud and
A. Detective error
B. Precentive C. Both (1) and (2)
C. Corretive D. Depends on the type of
D. Protective
40. Before the work of audit is commenced,
35. Balance sheet audit includes verification of the auditor plans out the whole of audit
work is called
A. Assets
A. Audit plan
B. Liabilities
B. Audit note
C. Income and expense accounts where
appropriate C. Audit programme
D. All of the above D. Audit report
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 211
41. Which of the following should be done if C. PAEPs
an audit recording fails? D. PRSPSs
PRACTICE BOOK» NOT FOR SALE
A. stop generating audit records
46. IT has several significant effects on an or-
B. Overwrite the oldest audit records ganization. Which of the following would
C. Send an alert to the administrator not be important from an auditing perspec-
D. Shut down the server tive?
A. Organizational charges
42. Which of the following is not a kind of au-
dit? B. The visibilty of information
A. Statutory and private. C. The potential for material misstate-
ment
B. Government and continuous audit.
D. None of the above
C. Interim audit.
D. None of these 47. Marketable securities (at cost) short term
should be classified as
43. How is the auditors’ own responsibility
A. Current Assets
for expressing the opinion on financial
statements disclosed in the standard (un- B. Non Current Assets
modified) report? C. Current Liabilities
A. stated explicitly in the auditor’s re- D. Non Current Liabilities
sponsibility section
B. unstated but understood in the audi- 48. A company auditor can be removed before
tor’s responsibility section expiry of his term by
C. stated expicitly in the opinion para- A. Shareholders
graph B. Board of Directors
D. stated explicitly in the introductory C. Central Government
paragraph
D. State Government
44. Audit of banks is an example of
49. In which year Chartered Accountant Act
A. Statutory audit came into effect in India
B. Balance sheet audit A. 1857
C. Concurrent audit B. 1949
D. Both (a) and (b) C. 1961
E. All of the above D. 2011
45. These statements are issued by the AASC 50. The communication of audit findings to
to provide interpretive guidance and prac- user is
tical assistance to auditors in the imple-
mentation of PSAs and to promote good A. Audit report
practice. B. Audit of historical financial statement
A. PREPs C. Financial statement audit
B. PAPs D. Operational audit
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 212
51. THE STRUCTURE OF THE AUDT PLAN 56. AUDIT CONCEPT:
STARTS FROM: A. To fulfil the ethical requirements of the
A. *The internal control description and profession
analysis, B. Auditor must be independent of the
B. *preliminary survey of operations preparer of the financial statements
C. *the expanded tests control systems, C. Process of examine the financial state-
ment and information of entity
D. *audit evaluation.
NARAYAN CHANGDER
D. to ensure that all the accounting
52. Which of the following are you unlikely to records and evidence are valid and truth-
see in the current file of auditors’ working ful
papers? 57. Internal control includes
A. Memorandum & articles of association A. Internal audit
B. Audit planning memorandum B. Internal check
C. Summary of unadjusted errors C. Both internal audit and internal check
D. Details of the work done on the inven- D. Internal check and external audit
tory count
58. What is auditing?
53. Marketable securities (at cost) should be A. The process of finding fault in the finan-
classified as ncial information
A. Current Assets B. The process of creating financial
stataement
B. Non Current Assets
C. The process of verifying the financial
C. Current Liabilities statement
D. Non Current Liabilities D. The process of creating evidence of fi-
nancial statement
54. Which of the following techniques enables
an already secure organization to assess 59. Which of the following persons is qualified
security vulnerabilities in real time? to be a company auditor?
A. Baselining A. An employee of the company
B. ACLs B. A body corporate
C. A person who is indebted to the com-
C. Continuous monitoring
pany for an amount exceeding Rs. 1000
D. Video survillance D. A practicing-chartered accountant
55. Engagement Team means all personnel per- 60. One of the developers in your organization
forming installs a new application in a test system
A. Audit to test its functionality before implement-
ing into production. Which of the following
B. Accounting is most likely affected?
C. Engagement A. Applicatio security
D. All of the above B. Initial baseline configuration
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 213
C. Application design B. The anticipated sample size of the
D. Baseline comparison planned substantive tests
PRACTICE BOOK» NOT FOR SALE
C. The entity’s annualized interim finan-
61. Non-current liabilities also called as? cial statements.
A. short term
D. The results of internal control ques-
B. long term debts tionnaire.
C. revenue
67. They typically require access to the or-
D. intangible assets ganization’s facilities, systems, personnel,
and documentation, and other types of evi-
62. Depending upon nature audit evidence can
dence evaluated in the course of the audit.
be classified as
A. Visual evidence A. External Auditors
B. Oral evidence B. IT Auditors
C. Documentary evidence C. External IT Auditors
D. All of these D. External IT Audit Drivers
63. Periodical audit is also called as 68. The IT director has asked you to install
A. final audit agents on several client computers and
monitor them from a program at a server.
B. interim audit What is this known as?
C. balance sheet audit A. SNMP
D. income statement audit B. SMTP
64. It is a action or Process Investing Money C. SMP
For Profit
D. Performance Monitor
A. Capital
B. Investment 69. Which of the following bodies does not
have any power to punish individual mem-
C. Shares bers for violations of the rules of profes-
D. Bond sional conduct?
65. Which of the following is a source docu- A. a CPA Canada
ment associated with the revenue cycle? B. b Canada Revenue Agency
A. Sales order C. c OSC
B. Deposit slip D. d CPA Ontario
C. Credit memo
70. If there is capital loss, the auditor should
D. All of the above
A. Not allow payment of dividend
66. Which of the following would an auditor
B. Allow payment of dividends
most likely use in determining a prelimi-
nary judgment about materiality? C. Allow payment of dividends after mak-
A. The contents of the management rep- ing such losses good
resentation letter. D. None of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 214
71. Which of the following is not an enhance- 76. is the evidence to check whether it ad-
ment to internal control that will occur as equately covers the hazards in the organi-
a consequence of increased reliance on IT? zation
A. Computer controls replace manual A. Interviews
controls
B. Documentation
B. Higher quality information is available
C. Observation
C. Computer based controls provide op-
D. None
NARAYAN CHANGDER
portunities to enhance separation of du-
ties
77. You suspect a broadcast storm on the
D. Manual controls replace automated LAN. Which tool should you use to diag-
controls nose which network adapter is causing the
72. What are the benefits of quality assurance storm?
for internal auditors A. Protocol analyzer
A. Obtaining best-practice recommenda- B. Firewall
tions and benchmarks.
C. Port scanner
B. Continuous improvement.
D. Network intrusion detection system
C. Both options are correct.
D. Both options are incorrect. 78. auditors perform accounting, tax and
consulting work for corporations, govern-
73. Inventories must be presented ments and individuals.
A. Lower of cost or net realizable value A. Internal
B. Higher of cost and net realizable value
B. Independent
C. Lower of cost and fair value
C. Public
D. Higher of cost and fair value
D. External
74. Why do we have IPPF standards?
79. In a principal agent relationship, who is
A. Provide the principles that represent
principal?
the practice of external auditing as it
should be. A. Auditor
B. Foster improved External Audit pro- B. Owner
cess and operations.
C. Management
C. Both options are correct.
D. Accountant
D. Both options are incorrect.
80. Audit of Accounts of Government Depart-
75. Which of the following sections deal with
ments
qualifications of the auditor?
A. Section 141(1) A. Complete Audit
B. Section 104 (1) and section 224 (2) B. Government Audit
C. Section 226 (3) and section 226(4) C. Internal Audit
D. Section 224(3) & Sec.224 D. External Audit
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 215
81. Which is NOT the roles of audit commit- 86. Which of the followings are internal users
tee? of financial statement?
PRACTICE BOOK» NOT FOR SALE
A. Review the work of internal audit A. Managers
B. Review the system of internal control. B. Auditors
C. Appropriate resources are committed C. Regulators
to companies. D. Creditors
D. May launch special investigations
87. Amount owed to a creditor for delivered
82. The auditor’s satisfaction as to the relia- goods or completed services.
bility of an assertion being made by one A. account payable
party for use by another party is called
B. account receivable
A. Opinion
C. interest
B. Assurance
D. loan
C. Examination
D. Verification 88. What must an auditor consider when un-
dertaking an audit
83. The audit firm should implement poli- A. Ethical standards issued by the profes-
cies to ensure all audits are conducted in sional bodies
accordance with Audit and Assurance Stan-
dards. B. Accounting standards
A. Detection Control C. The Corporations Act.
B. Quality control D. All of the above
C. Management control 89. Which of the following is not mandatory
D. Internal control when performing an audit in accordance
with GAAS?
84. Which of the following procedures does A. a. Proper supervision of assistants
the auditor typically perform when testing
the existence of cash? B. Efficient performance of audit proce-
dures
A. Counting cash at the depository insti-
tution. C. Understanding the auditee’s system of
internal controls
B. Inquiry of management.
D. Adequate planning of work to be per-
C. Sending a standard bank confirmation. formed
D. Tracing the bank reconciliation to the
general ledger. 90. auditors work with government de-
partments or private businesses, checking
85. .... auditing helps use to reduce manual for mismanagement of funds and finding
paper work ways to eliminate waste and fraud.
A. Electronic A. Independent
B. Internal B. Public
C. External C. External
D. none of above D. Internal
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 216
91. Tick ALL the documents that the Statutory 96. Showing less profit is important to
Financial Accounts include: A. Pay more tax
A. management accounts B. Pay less tax
B. balance sheet C. Ge more loan
C. income statement D. Get less loan
D. auditors’ report 97. What is an internal audit?
NARAYAN CHANGDER
E. cash-flow statement A. Check, compare, communicate and
consult.
92. he ease with which cash can be stolen
is most related to which of the following B. Check, compute, communicate and
risks? consult.
A. Control risk. C. Cheat, compare, communicate and
consult.
B. Inherent risk.
D. Check, compare, community and con-
C. Detection risk. sult.
D. Liquidity risk. 98. Marketable securities (at cost) available
for sale, should be classified as
93. In India, balance sheet audit is synony-
mous to A. Current Assets
A. Annual audit B. Non Current Assets
B. Continuous audit C. Current Liabilities
D. Non Current Liabilities
C. Detailed audit
D. Statutory audit 99. The first auditor of a company will hold of-
fice
94. What is the main reason to frequently A. For a period of one year
view the logs of a DNS server?
B. Till holding of statutory meeting
A. To create aliases
C. Till the conclusion of first annual gen-
B. To watch for unauthorized zone trans- eral meeting
fers D. Till a new auditor is appointed
C. To defend against denial-of-service at-
tacks 100. Outstanding Rent is an Example for
A. Outstanding Expenses
D. To prevent domain name kiting
B. Wages
95. Which of the folowings is external user of C. Rent
financial statement?
D. Intangible Assets
A. Bank
101. Old and new systems operating simulta-
B. President of company
neously in all locations is a test approach
C. Shareholder known as:
D. Management A. Pilot testing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 217
B. Horizontal testing C. Duplicate cash memo, cashier sum-
C. Integrative testing maries
PRACTICE BOOK» NOT FOR SALE
D. Parallel testing D. Duplicate cash memo, salesman ab-
stracts, cashier summaries
102. what is the act related to the misuse of
halal debate? 107. The term “Audit” originated from the
Latin word
A. trade description act 2009
A. Audire
B. trade description act 2011
B. Adhere
C. trade mark act 1984
C. Adihere
D. trade mark act 1977
D. None of the above
103. Which of the followings is NOT purpose
of audit? 108. Which of the following is a major activity
for the revenue cycle?
A. Ensure that financial statements are
bias A. Receive items
B. Ensure financial stataement is true B. Forecast production
and fair view C. Record time spent on specific jobs
C. Ensure that financial statement are rel- D. Deliver or ship order
evant
D. Ensure that financial statement are ob- 109. It consists of a listing of all of the gen-
jective eral ledger accounts and their correspond-
ing debit or credit balances
104. Which of the following is one of the ele- A. trial balance
ments of a CPA firm’s quality control sys-
tem B. balance sheet
A. leadership responsibilities C. income statement
B. computer assisted auditing techniques D. cash flow statement
C. control activities 110. In making a decision to accept or retain a
D. control environment client, the firm should consider
A. Its competence
105. Misappropriation of goods may be
checked by B. Its ability to comply with ethical re-
quirements
A. Proper supervision over stock
C. The integrity of the client’s manage-
B. Checking of employees
ment
C. Responsibilities of an auditor
D. All three should be considered
D. None of the above
111. Accounting standards are prepared by
106. Vouchers available for cash sales are
A. SEBI
A. Duplicate cash memo, salesman ab-
stracts B. RBI
B. Salesman abstracts, cashier sum- C. ASB
maries D. ITA
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 218
112. threat is the threat that a financial 117. If a PA says she always follows the rule
or other interest will inappropriately influ- that requires adherence to CPA pronounce-
ence the professional accountant judgment ments in order to give a standard unquali-
or behavior. fied audit report, she is following a philos-
A. Self interest ophy characterized by
B. Self review A. a the imperative principle in ethics.
C. Advocacy B. b the utilitarian principle in ethics.
NARAYAN CHANGDER
D. Intimidation C. c the generalization principle in ethics.
113. What materiality level is used by the au- D. d reliance on one’s inner conscience.
ditor in determining which line items in the
financial statements are to be tested? 118. Audit programme is prepared by
A. Overall materiality A. The auditor
B. Performance materiality B. The client
C. Specific materiality C. The audit assistant
D. Individual materiality
D. The auditor and his audit assistants
114. who will investigate any complaints?
119. To find out when a computer was shut
A. jakim officer is responsible for investi- down, which log file would an administra-
gating the complaints received tor use?
B. KPDNHEP is responsible for investigat-
A. Security
ing the complaints received
C. NGO is responsible for investigating B. System
the complaints received C. Application
D. Ministry of health is responsible for in- D. DNS
vestigating the complaints received
120. In the auditing environment, failure to
115. Requirements for training, independence,
meet auditing standards is often:
and due professional care are included in
which group of the generally accepted au- A. an accepted practice
diting standards?
B. a suggestion of negligence
A. Fieldwork
C. conclusive evidence of negligence
B. General
D. tantamount to criminal behavior
C. Reporting
D. Quality Control 121. covers the control of the whole man-
agement system.
116. . Errors of omission are
A. Internal Audit
A. Technical errors
B. Error of principle B. Internal Check
C. Compensating errors C. Internal Control
D. None of the above D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 219
122. An Auditor can hold the audit of not more C. Cash purchase
than companies D. Credit Sale
PRACTICE BOOK» NOT FOR SALE
A. 20
128. is a person whose job it is to make
B. 15 sure that information reported on financial
C. 10 statements is true and accurate and that
D. 30 the financial statements are prepared ac-
cording to GAAP principles.
123. An audit conducted throughout the year A. Accountant
or at the regular intervals of time is known
as B. Auditor
A. Continuous audit C. Watchdog
B. Internal audit D. Financier
C. Statutory audit 129. The liabilities of an auditor can be
D. External audit A. Civil
124. Final audit implies B. Criminal
A. Finally checking of accounts to reveal C. Civil & Criminal
frauds D. Financial
B. Audit for submitting report immedi-
130. Teeming and Landing is an example of
ately at the end of the year
A. Misappropriation of cash
C. Audit of banking companies
B. Misappropriation of goods
D. Audit of accounts at the end of the year
C. Manipulation of accounts
125. What are the techniques of verification?
D. All of the above
A. Inspection
B. Observation 131. Which of the following deals with the
standard load for a server?
C. Confirmation
A. Patch management
D. all the above
B. Group Policy
126. The objective of the audit planning is C. Port scanning
A. To give appropriate attention to all im- D. Configuration baseline
portant areas of audit
B. To identify potential problems 132. Which of the following does not pertain
to the standards of fieldwork?
C. c)To coordinate work with other audi-
tors and experts A. Adequate planning and supervision
D. c) All of the above B. Obtaining sufficient competent eviden-
tial matter
127. Property Acquisition C. Proper study and evaluation of inter-
A. Credit purchase nal control as a basis for reliance thereon
B. Cash sale D. Technical training and proficiency
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 220
133. On completion of an audit serves the pur- A. Closing balance of the current year
pose of audit record which may be useful B. Closing balance of the last year
for future reference.
C. Audited balance sheet of the last year
A. Audit programme
D. Audited balance sheet of the current
B. Audit working papers
year
C. Audit plan
139. In order to perform audit effectively, an
D. Audit notes
internal auditor must be independent of:
NARAYAN CHANGDER
134. Goods sent on approval basis’ have been A. The employer-employee relationship
recorded as ‘Credit sales’. This is an ex- which exists for other employees in the or-
ample of ganization.
A. Error of principle B. The line functions of the organizations.
B. Error of commission C. The entity.
C. Error of omission D. All of the above.
D. Error of duplication
140. Why users use financial statament?
135. Audit programme provides instructions A. To make sure profit is correct
to the audit staff and reduces scope for
B. To make decisions
A. Understanding
C. To make everyone satisfy
B. Misunderstanding
D. To make save the company
C. Negligence
D. Liabilities 141. How many phases are there in the SDLC?
A. 6
136. What does acronym O.B.B. stands for?
B. 7
A. Opening Billboard
C. 5
B. Organizational Buying Behavior
D. None of the above
C. Outcome-based Budgeting
D. Optus Business Broadband 142. The liability of auditor can be
A. Only civil
137. This term generally refers to any effort
that seeks to examine or validate the ac- B. Only criminal
curacy of information about a person or an C. Either civil and criminal
organization.
D. Civil and /or criminal
A. Due Dilligence
B. Due Diligence 143. Which of the following concepts is not in-
cluded in the wording of the auditor’s stan-
C. Due Dilegence dard report?
D. Due Diligince A. Management’s responsibility for the fi-
138. Auditor can verify the opening balance of nancial statements
cash receipts(Receipt side) of the current B. Auditor’s responsibility to assess sig-
year with nificant estimates made by management
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 221
C. Extent of auditor’s reliance on the au- B. Make sure you are following correct
ditee’s internal controls accounting standards
PRACTICE BOOK» NOT FOR SALE
D. Examination of evidence on a test ba- C. Decide which sectors and markets to
sis work in
144. CAATTS is also known as D. Achieve high levels of accuracy in
bookkeeping
A. Cost and account treatment
149. Internal check is a part of
B. Computer Assisted Audit tools Tech-
niques A. Internal audit
C. Classification and Accounting tools B. Internal accounting
D. Cost and Auditing tools C. External audit
D. Internal control
145. Who is primarily responsible for preven-
tion and detection of fraud and error in the 150. Partnership Act
company?
A. 1934
A. Management
B. 1932
B. External Auditor
C. 1933
C. Internal Auditor
D. 1936
D. none of above
151. Clerical error means
146. All of the companies must abide with
A. Arithmetic error
many laws and regulations including com-
pany law, tax law, and environmental pro- B. Rules and regulations
tection. Regulations requires which of the C. wrong posting
internal control objectives?
D. None
A. Effective operations
B. Financial Reporting 152. Which one of these involve in mid imple-
mentation review?
C. Government Reporting
A. Review and ensure information secu-
D. Compliance rity requirements are included in pro-
posed system.
147. A is a systematic capturing of how a
client behaves in a given set of contexts B. Interviews project team and stake-
and situations holders
A. Behavioural Audit C. Review should cover security controls
within application as well as infrastruc-
B. Procedural Audit
ture
C. Operational Audit
D. Suggest appropriate controls to be in-
D. All cluded in proposed solution.
148. Which one is NOT the task of audits? 153. Which of the following is not a category
A. Test the internal controls on your of an application control?
staff’s work A. Processing controls
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 222
B. Output controls C. Rights to speak at general meetings at-
C. Hardware controls tended on matters concerning them as au-
ditors
D. Input controls
D. none of above
154. The net income shall be added to
159. The most reliable type of audit evidence
A. Share capital that the auditor can obtain is
B. Treasury Shares A. A. Physical examination by the auditor.
NARAYAN CHANGDER
C. Retained Earnings B. Calculation by the auditor from the
D. Dividend Incomr company’s records.
155. General name for money, notes, bonds, C. A. Confirmation received directly from
goods, or services which represent third parties.
amounts owed D. External documents
A. cash
160. The First Auditors of a Company is Ap-
B. loan pointed by the
C. cheque A. Manager
D. debt B. Board of Directors
156. ‘Special notice of ordinary resolution has C. Employee
been given and on receipt of special notice, D. Auditor
the company must send a copy to the audi-
tor concerned and CCM.’ This is describing 161. An checks whether overall approach
the procedure for to health and safety is delivering the re-
sults you want
A. auditor appointment
A. Audit
B. auditor dismissal
B. Risk Profiling
C. auditor resignation
C. Control measures
D. auditor responsibility
D. Performances
157. Conclude on whether a exists about
the entity’s ability to continue as a going 162. Which tool can be instrumental in captur-
concern. ing FTP GET requests?
A. material misstatement A. Vulnerability scanner
B. material uncertainty B. Port scanner
C. material disclosures C. Performance monitor
D. none of above D. Protocol analyzer
158. Which of the following is NOT a statutory 163. Obligation whose liquidation is expected
rights of an external auditor? to require the use of existing resources
A. Rights to attend any general meetings classified as current assets, or the creation
of the company of other current liabilities.
B. Rights to attend any directors meet- A. current account
ings of the company B. current asset
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 223
C. current liability C. Ernst & Young
D. current issue D. Price Water House Cooper
PRACTICE BOOK» NOT FOR SALE
164. It is the summary of the effect of rev- 169. Is the value of the Reputation of a busi-
enues and expenses over a period of time. ness
A. shareholder’s equity A. Stock
B. cash flow B. Building
C. income statement C. Machinery
D. balance sheet D. Goodwill
165. Which of the following is not an attribute 170. Auditing is compulsoryfor ?
of an external auditor? A. Small scale business
A. Client advocacy B. Partnership firms
B. Integrity. C. Joint stock Companies
C. Professional competence with re- D. Proprietary Concerns
gards to underlying subject matter
171. Corporate governance focus only on in-
D. Objectivity ternal monitoring mechanisms in the public
166. Responsible for ensuring the achieve- company
ment and maintenance of organizational A. Yes
compliance with applicable external stan- B. No
dards or certifications.
C. Maybe
A. Alliance Officer
D. none of above
B. Appliance Officer
172. The Philippine Standards on Quality Con-
C. Compliance Officer
trol (PSQCs) are to be applied to
D. Complied Officer
A. Assurance engagements only.
167. You have been tasked with providing B. Review engagements only.
daily network usage reports of layer 3
C. Compilation and review engagement
devices without compromising any data
only.
during the information gathering process.
Which of the following should you select D. All services that fall under the AASC’s
in this scenario? engagement standards.
A. ICMP 173. means an examination of ledger en-
B. SNMP tries to see that each entry is supported
by documentary evidence as also that it
C. SNMPv3
has been properly written in the books of
D. SSH accounts
168. The followings are the Big 4 of audit com- A. Auditing
panies in Malaysia EXCEPT: B. Accounting
A. Deloitte C. Vouching
B. Aftaz D. Testing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 224
174. IPPF stands for: A. System Implementation
A. International Professional Practices B. System Testing and Acceptance
Foundation C. System Design
B. International Profession Practices D. System Initiation
Framework
179. Effective internal check system reduces
C. International Professional Practical
Framework A. The liability of auditor
NARAYAN CHANGDER
D. International Professional Practices B. Work of auditor
Framework C. Responsibilities of an auditor
175. is a method of organizing the account- D. None of the above
ing system of a business concern or a fac- 180. Which of the following would probably
tory by which the duties of various clerks not be considered an “act discreditable to
are arranged in such a way that the work the profession”?
of one person is automatically checked by
another. A. a Numerous moving traffic violations
A. Internal control B. b Failing to file the PA’s own tax return
B. Internal check C. c Filing a fraudulent tax return for a
client in a severe financial difficulty
C. Internal audit
D. d. Refusing to hire Asian Canadians in
D. All the above an accounting practice
176. While performing audit services for their 181. ....section of Companies Act deals with
clients, professional accountants have a share Capital
duty to provide a level of care which is
A. 69
A. Reasonable
B. 60
B. Greater than average C. 50
C. Superior D. 59
D. Guaranteed to be free from error
182. Accounting estimates are highly depen-
177. Which of the following services provides dent on
the lowest level of assurance about a com- A. Expert
pany’s financial statements?
B. Management
A. Audit of financial statements.
C. Judgment
B. Review of financial statements.
D. Past judgment
C. These services provide no assurance
about a company’s financial statements. 183. Auditors want to know if a company’s ac-
counts offer a
D. These services provide the same level
of assurance about a company’s financial A. reliable and fair view
statements. B. true and fair view
178. What is the third phase in SDLC Standard C. trustworthy and reliable view
Phases? D. real and true view
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 225
184. Elements of an Effective Corporate Gov- 189. What do Internal Auditors do?
ernance System are A. Determining if entities are not comply-
PRACTICE BOOK» NOT FOR SALE
A. Accountability ing with applicable laws.
B. Transparency B. Preparing financial statement and en-
C. Regulatory framework sure its accuracy and proper treatment.
D. Business ethics and social responsibil- C. One option is correct.
ity D. Both options are correct.
185. Audit it covers all the areas of business
190. Performing analytical procedures is one
A. General Audit the most basic yet among the most
B. Specific Audit tools that auditors have at their disposal.
C. Complete Audit A. power
D. Interim Audit B. powerful
186. The essence of a financial report audit is C. powerless
to: D. powder
A. examine individual transactions so
191. How auditor adds credibility of account-
that the auditor may certify as to their va-
ing reports?
lidity.
B. detect fraud A. Assist in preparing financial statae-
ment
C. assure the consistent application of
correct accounting procedures. B. Providing proof of evidence of account-
ing records
D. determine whether the client’s finan-
cial reports are fairly stated. C. Helps management with ideas to the
business
187. Typically involve interrogation of com-
D. Provides opinion on true and fair view
puter systems control files in order to
of financial information
match access rights granted against job re-
quirements 192. Unamortized bond discount and expenses
A. Logical Access Audits shall be treated as
B. Application Audits A. Deduction to long term liability
C. Physical Access Audits B. Addition to long term liability
D. Operational Audits C. Increase to Interest Expense
188. . is the specific guidelines and directions D. Decrease to Interest Expense
for efficient and effective completion of
the audit work on timely and daily basis, 193. Which is not a publicly listed company in
so as to minimise audit risk. the Philippines?
A. Audit planning A. BDO Unibank, Inc.
B. Audit report B. Ayala Corporation
C. Audit programme C. Walmart Inc.
D. Audit certificate D. Insular Life Assurance Company, Ltd
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 226
194. THE STRUCTURE OF THE AUDIT PLAN 199. Sole proprietary concerns are to get
ENDS ON: their financial statements audited by inde-
pendent financial auditors.
A. *the expanded tests control systems
A. Legally required
B. *The development of findings and rec-
ommendations, B. Not legally required
C. *the report production, C. Ethically required
D. *audit evaluation D. Not ethically required
NARAYAN CHANGDER
200. Vouching of the balances of all incomes
195. A continuous audit is specially needed for
and expenses account is known as vouch-
A. Any trading concerns ing of
B. Smaller concerns A. Personal ledger
C. Banking companies B. Impersonal ledger
D. Any manufacturing companies C. Cash
D. none of above
196. An audit programme is a set of which
are to be followed for proper execution of 201. is to check what’s describes in the
audit. documentation is really present in the
A. Rules workplace
B. Policies A. observation
B. interview
C. Instructions
C. documentation
D. none of above
D. all of them
197. Which one is NOT key challenges of Pub-
lic Sector Auditing? 202. followed by the enterprise affect the
audit plan
A. Increase use of technology
A. Accounting policies
B. Receive a demand for new types of Au-
B. Audit policies
dits.
C. Accounting and Audit policies
C. Inadequate number and relative com-
petence of Audit Personnel D. Management policies
D. Transitional method:Straight line and 203. Assurance standards do not contain a re-
Reducing balance quirement that auditors obtain
198. If the amount of a voucher exceeds Rs A. adequate knowledge in the subject
, it should be properly stamped matter of the assertions being examined.
A. 50000 B. an understanding of the auditee’s in-
ternal control structure.
B. 500
C. sufficient evidence for the conclusions
C. 5000 expressed in an attestation report.
D. 10000 D. independence in mental attitude.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 227
204. The auditor prepares the audit report 209. At the planning stage you would NOT con-
with the help of sider
A. the timing of the audit
PRACTICE BOOK» NOT FOR SALE
A. Working papers
B. Audit note book B. whether corrections from the inven-
tory count have been implemented
C. Trial balance
C. last year’s audit
D. none of above
D. the potential use of internal audit
205. You are setting up auditing on a Windows
210. The Purpose of a Public Company is to:
computer. If set up properly, which log
should have entries? A. Maximize profits
A. Application log B. Satisfy all stakeholders equally
C. Perpetuate the corporation
B. System log
D. None of the above
C. Security log
D. Maintenance log 211. Period of 12 consecutive months chosen
by an entity as its accounting period which
206. Fraud refers to an which are more may or may not be a calendar year.
to be detected. A. short-term
A. intentional act, easier B. long-term
B. intentional act, difficult C. fiscal year
C. unintentional act, easier D. annually
D. unintentional act, difficult 212. Process of checking the evidence of the
entries is called
207. A professional accountant should comply
A. Verification
with relevant laws and regulations and
should avoid any action that discredit the B. Observation
profession. C. Vouching
A. Integrity D. none of above
B. Objectivity 213. Sec.140 of the Companies Act 2013 deals
C. Professional competence and due with
care A. Removal of an auditor
D. Professional behaviour B. Appointment of an auditor
C. Remuneration of an auditor
208. One significant risk related to an auto-
mated environment is that auditors may D. None of the above
information provide by an information 214. How many types of Principles of Ethic
system based on MIA By-Laws?
A. Not place enough reliance on A. 2
B. Place too much reliance on B. 3
C. Reveal C. 4
D. Not understand D. 5
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 228
215. What is not included in the primary objec- C. an auditor or jury audit officer after the
tive of auditing? payment is made by the applicant
A. Accounts are written correctly D. audit staff who are not under jakim
B. Employee moral check 220. In planning the audit engagement, the au-
C. Check P & L shows correct value of ditor should consider each of the following,
profit or loss except
D. Check B/s shows correct value of as- A. The type of opinion that is likely to be
NARAYAN CHANGDER
sets and liabilities expressed.
216. The third generally accepted standards of B. The entity’s accounting policies and
reporting in auditing refers to procedures.
A. Whether financial statements are pre- C. Matters relating to the entity’s busi-
sented in conformity with GAAP ness and the industry in which it operates.
B. Whether accounting principles have D. Materiality level and audit risk.
been consistently observed
221. What are the three aspects of human na-
C. Adequacy of disclosures ture?
D. An expression of opinion on the finan- A. Approval, Discounting, Escalation
cial statements taken as a whole
B. Familiarity, Discounting, Escalation
217. An inspection of facilities, equipment, C. Familiarity, Attachment, Discounting
work practices which identifies any areas
D. Discounting, Familiarity, Approval
or practices that might be hazardous to em-
ployees is a ? 222. Which standard starts with number 1?
A. General Safety Audit A. Overarching Standard
B. Safety Program B. Underlying Standards
C. Emergency Plan C. Performance Standard
D. none of above D. Two options are correct.
218. The process of identifying, measuring, 223. Share premium account should be shown
classifying, recording, summarizing and in the Balance sheet under
communicating in a logical manner for the
A. Paid-up capital
purpose of providing financial information
for decision-making is B. Subscribed capital
A. Finance. C. Reserves & surplus
B. Economics. D. Reserved capital
C. Auditing. 224. Is a bond which is Worth a certain mone-
D. Accounting. tary value
219. who performs the audit process? A. Money
A. agency under MITI B. Vouchers
B. agencies that are not involved with au- C. Audit
diting D. Bond
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 229
225. What are two types of misstatements? 231. Initial audit planning involves the follow-
A. Misappropriation of assets ing matters, except
PRACTICE BOOK» NOT FOR SALE
B. Top-side journal entries A. Identify the client’s reason for the en-
gagement.
C. Fraudulent financial reporting
B. Schedule engagement staff and audi-
D. Internal control weaknesses
tor’s experts.
226. auditors assert whether financial C. Develop an overall audit strategy.
statements are free of material misstate-
ment due to error or fraud. D. Request that bank balances be con-
firmed.
A. External
B. Public 232. Auditing is luxury for a
C. Independent A. joint stock company
D. Internal B. partnership firm
227. Audit papers are the property of C. small shop-keeper
A. Client D. goverment company
B. Auditor 233. Which of the following are components of
C. Both the client and the auditor thedefinition of internal auditing?
D. The audit committee A. Independence and objectivity.
228. Internal auditing is , and that B. A systematic and disciplined approach.
is designed to add value and improve the C. Helping the organization accomplish
organization’s operation. its objectives.
A. consulting activity D. All of the above.
B. independent
234. A persons shall not be eligible for appoint-
C. giving audit report for public reviews
ment as an auditor of a company if
D. objective assurance
A. A body corporate other than a limited
E. an examination liability partnership
229. A modern company is regulated by B. An officer or employee of the company
A. regulators C. All of the Above
B. laws D. None of the Above
C. shareholders
235. Audit sampling is the method of audit
D. none of above procedure where auditors test less than
230. The audit that is made compulsory under 100% of items within the of account
statute is called balance or class of transaction.
A. Statutory audit A. amount
B. Partial audit B. number
C. Complete audit C. population
D. Continuous audit D. quantity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 230
236. The failure of the auditor to meet the req- 241. Any service in which the accounting most
uisites of PSA is firm issues a report about the reliability of
an assertion that is made by another party
A. An accepted practice
is a(n)
B. A suggestion of negligence
A. Tax service.
C. An evidence of negligence
B. Attestation service.
D. Tantamount to criminal behavior
C. Accounting and bookkeeping service.
NARAYAN CHANGDER
237. are appointed by the shareholders. D. Management advisory service.
A. Accountants
242. Auditing standards differ from auditing
B. Audits procedures in that procedures relate to
C. Sales manager A. Measure of performance
D. Directors B. Audit principles
238. Audit papers are the property of C. Acts to be performed
A. Client D. Audit judgments
B. Auditor 243. Secondary objective of auditing are
C. Both the client and the auditor A. 1. Detention and prevention of fraud
D. The audit committee B. 2. Detention and prevention of errors
239. The primary objective of compliance au- C. Both 1 and 2
diting is to D. None
A. give an opinion on financial state-
244. The following(s) is/are examples of
ments.
event(s) that may generate(s) operational
B. develop a basis for a report on internal risk:
control.
A. Availability of staff.
C. perform a study of effective and effi-
B. Utility failures.
cient use of resources.
C. Non-compliance with key legislations.
D. determine whether auditee personnel
are following laws, rules, regulations, and D. All options are correct.
policies.
245. When a transaction has not been
240. Taking action on lessons learned from ac- recorded in the books of account either
cidents and incidents occurs on which pdca wholly or partially such errors are called
cycle
A. Check A. Error of commission
B. Do B. Error of omission
C. Act C. Compensating error
D. Plan D. None of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 231
246. The following(s) is/are core principles 251. Which is not a characteristic of a special-
for the Professional Practice of Internal ized industry?
Auditing:
PRACTICE BOOK» NOT FOR SALE
A. Complex accounting
A. Demonstrates integrity.
B. Strict compliance requirements
B. Communicates efficiently.
C. High Risk
C. Is subjective and free from undue in-
fluence . D. Unusual or rare in nature
D. All options are correct. 252. External audit firms performing regula-
tory audits is also called
247. Audit programme helps in fixing the for
the work done among the audit staff as A. Statutory Audio
work done may be traced back to the indi- B. Stutatory Audits
vidual staff members
C. Statotury Audits
A. Remuneration
D. Statutory Audits
B. Liabilities
C. Negligence 253. .... are the assets which may arise on the
D. Responsibility happening of an uncertain event.
A. Fixed assets
248. Which is not a duty of the auditor?
B. Intangible assets
A. Duty as to report under voluntary wind-
ing up C. Contingent assets
B. Duty to sign report D. Wasting assets
C. All of the Above
254. Independent auditors of financial state-
D. None of the Above ments perform audits that reduce and con-
trol
249. Which of the following log files should
show attempts at unauthorized access? A. the business risks faced by investors.
A. DNS B. the information risk faced by in-
vestors.
B. System
C. the complexity of financial statements.
C. Application
D. quality reviews performed by other
D. Security
public accounting firms.
250. The quantity of audit working papers
complied on engagement would most be af- 255. Which type of Ethic is applicable to an
fected by auditor who provide Audit Services to the
client/company?
A. management’s integrity
A. Practice Ethic
B. auditor’s experience and professional
judgment B. Business Ethic
C. auditor’s qualification C. Subject Ethic
D. control risk D. Company Ethic
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 232
256. In the initial stage auditing was not A. Overall materiality
for all B. Scoping materiality
A. compulsory C. Specific materiality
B. voluntary D. Performance materiality
C. specific
262. Audits procedures are methods or tech-
D. none niques that auditors use to obtain audit
and form an opinion regarding the fi-
NARAYAN CHANGDER
257. Which of following is the most basic form
of IDS? nancial statements of a company.
A. Anormaly-based A. evidence
B. Behavioral-based B. information
C. Signature-based C. knowledge
D. Statistical-based D. source
258. Subscription Receivable collectible within 263. The third standard of field work states
12 months shall be treated as that sufficient competent evidential mat-
ter may in part be obtained through the
A. Current Assets (Receivables) following methods except
B. Addition to Subscribed Share Capital A. Inspection
C. Deduction to Subscribed Share Capital B. Observation
C. Confirmation
D. none of above
D. Reconciliation
259. International Standards on Auditing (ISA
500), Audit Evidence classifies assertions 264. Which of the following is NOT the statu-
into several broad categories EXCEPT: tory duty of an external auditor?
A. Competency. A. To report his opinion on whether the
financial statements give a true and fair
B. Existence. view.
C. Occurrence. B. To ensure the accounting and other
D. Measurement. records are kept as required by the Com-
pany Act 2016
260. Auditing means
C. To attend attend general meeting or
A. Detection and prevention of frauds annual general meeting where the finan-
B. Detection and prevention of errors cial statements are laid
C. Detection and prevention of errors and D. none of above
frauds
265. Auditor do the valuation of assets
D. Controlling of accounts
A. True
261. What materiality level would be consid- B. False
ered by the auditor to determine whether
the proposed adjustments are significant C. None
or not? D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 233
266. When computer programme or files can 271. The generally accepted standards of re-
be accessed from terminals, access can be porting encompass all to the following ex-
limited to authorized individuals by cept
PRACTICE BOOK» NOT FOR SALE
A. appointing a librarian A. consideration of an entity’s internal
B. controlling passwords control
C. appointing EDP auditor B. consistent application of accounting
principle
D. Both (a) and (b)
C. informative disclosures
267. The official legal Right to Make or Sell .an
D. conformity of financial statements
Invention for a Particular Number of years
with GAAP
A. Copy Right
272. Auditor report is addressed to the mem-
B. Fraud
bers of the company and is considered at
C. Patent the of the company.
D. Trade Mark A. Board Meeting (BM)
268. Audit means to check B. Annual General Meeting (AGM)
A. Employees C. Extraordinary General Meeting (EGM)
B. Management D. All of the above
C. Financial Statements
273. The Philippine Standards on Review En-
D. Market gagements (PSREs) are to be applied in
269. The audit procedure which is least useful A. The audit of historical financial infor-
in gathering evidence on significant com- mation
puter processes is B. Assurance Engagements dealing with
A. Documentation subject matters other than historical fi-
nancial information
B. Observation
C. The review of historical financial infor-
C. Test decks
mation
D. Generalized audit software
D. The review of both historical and
270. When an auditor disclose the confidential prospective financial information
information about a company outside the
firm without the company approval, the 274. Which of the following best describes
auditor has VIOLATES which type of Prin- the primary purpose of audit programme
ciple of Ethic? preparation?
A. Professional Competence and Due A. To detect errors
Care B. To comply with GAAP
B. Objectivity C. To gather sufficient appropriate evi-
C. Confidentiality dence
D. Integrity D. To assess audit risk
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 234
275. An examination of part of an organiza- 280. At the end of their tests the auditors first
tion’s procedures and methods for the pur- send
pose of evaluating efficiency and effective- A. qualified opinion
ness is known as
B. management accounts
A. Financial statement audit.
C. the letter to management
B. Production audit.
D. purchasing ledger
C. Operational audit.
E. a letter to shareholders
NARAYAN CHANGDER
D. Compliance audit.
281. An auditor shall consider materiality
276. Choose which is the correct valuation for when I. Determining the nature, timing,
audit procedure for non-current liabilities. and extent of audit procedures. II. Eval-
A. re-computation uating the effect of misstatements.
B. re-computation and vouching A. I only
C. re-computation, vouching and tracing B. II only
C. Both I and II
D. re-computation, vouching, tracing and
presenting D. Neither I nor II
277. Who should appoint the company’s audi- 282. While framing an audit plan auditor
tor in the first year of incorporation? should ascertain his cast by various legis-
lations on him.
A. Members of the company
A. Limitations
B. Board of Directors of the company
B. Duties and obligations
C. The Registrar
C. Rights and powers
D. none of above
D. Term of appointment & responsibilities
278. If the auditor is of the opinion that the fi-
283. Erroneous data has been detected by com-
nancial statement does not show the true
puter program controls. It has been ex-
and fair view of the state of affairs of the
cluded from processing and printed sepa-
business, he issues a report
rately “Error Report”. Who should most
A. Clean probability by review and follow up on
B. Qualified this report?
C. Disclaimer A. system, analyst
D. Adverse B. Data control group
C. Programmer
279. Wealth in the form of money or Assets
D. Computer operator
owned by a person or organization
A. Money 284. Operational audits of a company’s effi-
ciency and economy of managing projects
B. Vouchers
and of the results of programs are con-
C. Capital ducted by whom?
D. Shares A. Financial statement auditors
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 235
B. The company’s internal auditors D. application incomplete according to
C. Tax auditors employed by the federal the procedure
PRACTICE BOOK» NOT FOR SALE
government 289. Which of the following protocols are
D. Fraud auditors you observing in the packet capture be-
low? 16:42:01-SRC 192.168.1.5:3389-
285. The is also expected to provide the re- DST 10.254.254.57:8080-SYN/ACK
sources needed and select staff members
to accompany the auditors. A. HTTP
A. auditor B. HTTPs
B. client C. RDP
C. internal auditor D. SFTP
D. auditee 290. Concurrent audit is a part of
286. Auditor is having disagreement with the A. Internal check system
management over the audit fees to be B. Continuous audit
charged and choose to resign. What is the C. Internal audit system
documents that the external auditor may
choose to issue together with his notice of D. None of these
resignation? 291. A measure of how willing the auditor
A. Statement of Circumstances is to accept that the financial statements
B. Statement of No Circumstances may be materially misstated after the au-
dit is completed and an unqualified opinion
C. Written Representation has been issued is the
D. none of above A. Inherent risk.
287. What is the sequence of the SDLC B. Acceptable audit risk.
phases? C. Statistical risk.
A. Analysis, Planning, Detailed System D. Financial risk.
Design, Implementation, Maintenance
B. Planning, Analysis, Detailed System 292. The cornerstones of effective corporate
Design, Implementation, Maintenance governance are:
C. Detailed System Design, Analysis, A. audit committee
Planning, Implementation, Maintenance B. management
D. Detailed System Design, Planning, C. external auditors
Analysis, Implementation, Maintenance D. All options are correct.
288. when auditing will start? 293. Must respect information acquired in the
A. complete half application according to course of their work and must not disclose
the prescribed procedure any such information to a third party with-
B. application has been completed ac- out specific authority, unless there is a le-
cording to the prescribed procedure gal or professional duty to disclose it.
C. complete application does not follow A. Professional behaviour
procedures B. Integrity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 236
C. Objectivity 299. Audit in depth is synonymous for-
D. Confidentiality A. Complete audit
294. Internal Audit is carried out by? B. Completed audit
A. The Institute of Internal Auditors C. Final audit
B. National Audit Department D. Detailed audit
C. Internal Audit Unit
300. Civil liability of an auditor implies liability
NARAYAN CHANGDER
D. National Audit Department and Inter- for
nal Audit Unit
A. Misappropriation of cash
295. Which of the required materiality lev- B. Misappropriation of goods
els is calculated by multiplying a certain
percentage by the appropriate benchmark C. Fraud
which is either an element or component of D. Misfeasance
an entity’s financial statements?
301. Your manager wants you to implement a
A. Overall materiality
type of intrusion detection system (IDS)
B. Planning materiality that can be matched to certain types of
C. Scoping materiality traffic patterns. What kind of IDS is this?
D. Specific materiality A. Anomaly-based IDS
296. Which of the following can determine B. Signature-based IDS
which flags are set in a TCP/IP hand- C. Behavior-based IDS
shake?
D. Heuristic-based IDS
A. Protocol analyzer
B. Port scanner 302. Duties of auditors are as follows EXCEPT:
C. SYN/ACK A. Detect frauds, errors and irregulari-
ties
D. Performance Monitor
B. To exercise reasonable care and skill
297. All or portion of an account, loan or note
C. To report and warns any fraud or ma-
receivable considered to be uncollectible.
jor error detected during the course of an
A. loan audit.
B. borrow D. Verify the accuracy of company ac-
C. dividend counts.
D. bad debt 303. A number of checks and controls exer-
298. A Company or Person to whom Money is cised in a business to ensure its efficient
owning working is known as
A. Creditors A. Internal check
B. Debtors B. Internal control
C. Credit C. Internal audit
D. All the above D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 237
304. Who will present the audit report to the 309. Which error do not affect the trial balance
PAC? and is most difficult to find?
PRACTICE BOOK» NOT FOR SALE
A. Public sector organisations A. Clerical error
B. Auditor general department B. Error of omission
C. Public accounts committee C. Error of comission
D. None of the above D. Compensating Error
305. threat that a professional accountant 310. The government examines tax returns
will promote a client’s or employer’s posi- completed and submitted by a taxpaying
tion to the point that the professional ac- entity to confirm that information on a tax
countant’s objectivity is compromised return is correctly reported and accurate.
A. Self interest A. Internal Revenue Service Audit
B. Self review B. Internal Revenue System Audit
C. Advocacy C. Internal Revenue Source Audit
D. Intimidation D. none of above
306. When people speak of the assurance func- 311. The standards of due audit care requires
tion, they are referring to the work of au- the auditor to
ditors in A. Make perfect judgement decision in all
A. lending credibility to a client’s financial cases
statements. B. Ensure that the financial statements
B. detecting fraud and embezzlement in a are free from error
company. C. Possess skills clearly above the aver-
C. lending credibility to an auditee’s fi- age for the profession
nancial statements. D. Apply judgement in a conscientious
D. performing a program results audit in manner, carefully weighing the relevant
a government agency. factors before reaching a decision
307. Investigation is an examination of 312. Which of the following quality control
A. Books of accounts procedures relates to engagement perfor-
mance
B. Trial balance
A. hiring
C. Final account
B. direction
D. All of these
C. professional development
308. Act that departs from what should be D. advancement
done; imprudent deviation, unintentional
mistake or omission. 313. Wages Act
A. error A. 1934
B. risk B. 1932
C. fraud C. 1938
D. danger D. 1936
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 238
314. As you review your firewall log, you 318. Recording a transaction twice in the
see the following information. What type books of original entry is an error of
of attack is this? S=207.50.135.54:53-
A. Principle
D=10.1.1.80:0S=207.50.135.54:53-
D=10.1.1.80:1S=207.50.135.54:53- B. Commission
D=10.1.1.80:2S=207.50.135.54:53- C. Duplication
D=10.1.1.80:3S=207.50.135.54:53-
D=10.1.1.80:4S=207.50.135.54:53- D. none of above
D=10.1.1.80:5
NARAYAN CHANGDER
319. These are the types of audit:
A. Denial-of-service
A. Internal Control
B. Port scanning
B. Financial Statements
C. Ping scanning
C. Constitution
D. DNS Spoofing
D. Applications
315. Financial report auditing can best be de-
E. Special
scribed as:
A. a regulatory function that prevents the 320. Which of the following standards are to
issuance of improper financial informa- be applied, as an appropriate, in the audit
tion. of historical financial information?
B. a professional activity that measures A. PSREs
and communicates financial and business
B. PSAEs
data.
C. a discipline that attests to the results C. PSRSs
of accounting and other functional opera- D. PSAs
tions and data.
321. The Auditors Working Papers are divided
D. a branch of accounting.
into two parts
316. The auditors will inspect such documents A. Permanent audit file and current audit
as: file
A. invoices B. b)Permanent audit file and temporary
B. management letter audit file
C. qualified reports C. temporary audit file and current audit
file
D. bank statements
E. receipts D. current audit file and transitory audit
file
317. In what way can you gather information
from a remote printer? 322. Objectives of internal audit includes
A. HTTP A. Proper control
B. SNMP B. Perfect accounting system
C. CA C. Asset protection
D. SMTP D. All of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 239
323. The auditor is required to determine three C. Central Government
different levels of materiality:(1) material- D. Company Law board
ity for the financial statements as a whole,
PRACTICE BOOK» NOT FOR SALE
(2) performance materiality, and (3) 328. Remuneration of an internal auditor is
A. Overall materiality fixed by
B. Planning materiality A. Management
C. General materiality B. Shareholders
C. Government
D. Specific materiality
D. Statutory body
324. The general standards of the generally
accepted auditing standards include a re- 329. Auditor should see that amount received
quirement that: for premium on issue of shares should be
shown in
A. The fieldwork to be adequately
planned A. Subscribed capital
B. The auditor’s report to state whether B. Capital Reserve Account
the financial statements are presented in C. Share Premium account
conformity with PFRS
D. Paid-up capital account
C. Due professional care be exercised by
the auditor 330. Internal auditor of a company must be
D. The auditor to obtain sufficient, compe-
tent evidential matter A. Cost accountant
B. Chartered accountant
325. Which of the following is the most rele-
vant assertion with regards to the audit of C. ICWA
cash? D. Need not possess any professional
A. Existence qualification
B. Rights and obligations. 331. Capital stock having no references gener-
C. Valuation and allocation. ally in terms of dividends, voting rights, or
distributions.
D. Presentation and disclosure.
A. bond
326. Focus on the effectiveness and efficiency B. equity
of business operations and could include
C. common stock
A. Financial Audits
D. share
B. Operational Audits
332. Planning an audit involvesI. Establishing
C. General Control Audits
the overall audit strategy for the engage-
D. Application Audits ment. II.-Developing an audit plan.
327. An auditor in a casual vacancy is ap- A. I only
pointed by the B. II only
A. Board of Directors C. Both I and II
B. Shareholders D. Neither I nor II
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 240
333. Who among the following can be ap- 338. Audit can be done by only in India
pointed as auditor of a company?
A. Accountant
A. A partner or a director of a company
B. B.Com Graduate
B. A person of unsound mind
C. Chartered Accountant
C. Mr. who owes Rs.500 to the company
D. Owner of company
D. Mr. Z the holder of C.A certificate
339. An audit programme is a set of which are
NARAYAN CHANGDER
334. When accountant or auditor attend for-
mal education, relevant practical train- to be followed for proper execution of au-
ing and experience and continuing profes- dit.
sional education, he or she is said to fulfill A. Rules
which type of Principles of Ethic?
B. Policies
A. Integrity
B. Objetcivity C. Instructions
C. Professional Competence and Due D. Actions
Care
340. When is evidential matter, generally,
D. Professional Behaviour considered sufficient?
335. What is the purpose of audit? A. When it constitutes entire population
A. To satisfy the auditor B. When it is enough to provide a basis
B. To assist management to do financial for giving reasonable assurance regard-
stataement ing truthfulness
C. To provide reliable information to C. When it is objective and relevant
users
D. When auditor collects and evaluates it
D. To avoid shareholder being cheated by independently
management
341. The main object of anaudit is ?
336. Which of the followings are not the types
of auditor? A. Expression of opinion
A. Financial auditor B. Detection and Prevention of fraud and
B. Company auditor error
C. External auditor C. Both (A) and (B)
D. Governmental auditor D. Depends on the type of audit.
337. Based on answer given, which is the cor-
342. An auditor should have in carrying his
rect test for accuracy of listing of non-
roles in SDLC:
current liabilities.
A. Empathy
A. test clerical
B. test clinical B. Trustworthy
C. test cleryical C. Kindness
D. test clirecal D. Competence
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 241
343. Objectives of auditing can be mainly cat- 348. A progressive audit programme is also
egorised into parts called a
PRACTICE BOOK» NOT FOR SALE
A. 1 A. Tailor made
B. 3 B. Man made
C. 6 C. Auditor made
D. 9 D. Skeleton
344. Involve examining support for the indi- 349. Which of the following standards are to
vidual debits and credits posted to an ac- be applied to compilation engagements,
count. engagements to apply agreed-upon proce-
dures to information, and other related
A. tests of details of balances services engagements as specified by the
B. tests of controls AASC?
C. tests of details of transactions A. PSRSs
D. analytical procedures B. PSAs
C. PSAEs
345. An auditor of Government company has
to submit his report to the:- D. PSREs
A. Shareholders 350. Which of the following best describes
B. Central Government what is meant by generally accepted au-
diting standards?
C. C & A-G
A. Audit objectives generally determined
D. Ministry concerned on audit engagements
346. Sec.143 of Companies Act 20913 deals B. Acts to be performed by the auditor
with C. Measure of the quality of the auditor’s
A. Powers and rights of an auditor performance
B. Removal of an auditor D. Procedures to be used to gather evi-
dence to support financial statements
C. Appointment of an auditor
351. It is a type of Enterprise that is owned
D. Remuneration of an auditor
and Run by one person
347. Sec.139 (7) provides that in the case of A. Enterprise
a Government Company or any other com-
B. Enterprenur
pany owned or controlled by the Central
Government, or by any State Government, C. Sole Trading Concern
the first auditor shall be appointed by D. All the above
A. Controller and Auditor-General of In-
352. is the remaining level of risk follow-
dia
ing the development and implementation
B. Central Government of the entity’s response.
C. State Government A. Risk
D. None of the above B. Inherent Risk
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 242
C. Residual Risk 358. When auditing marketable securities, the
D. Returns auditor will do which of the following?
A. Examine broker’s advices evidencing
353. Manipulation of accounts is done by purchase of securities.
A. Responsible & senior officers
B. Recompute income.
B. Owners
C. Foot schedule.
C. Directors of the business
D. All of the options.
NARAYAN CHANGDER
D. All of the above
359. Types of fraud
354. Which is not an audit consideration when
it comes to auditing specialized indus- A. Misappropriation of cash
tries? B. Misappropriation of goods
A. Engagement Budget C. Manipulation of accounts
B. Reliance on Experts D. All of the above
C. Competence 360. Asset valuation is done by the him-
D. Audit Planning self.
355. .... is the system in which we keep phys- A. Auditor
ical register of journal and ledger for keep- B. Shareholder
ing the records of each transactions.
C. Proprietor
A. Traditional accounting
D. Management
B. Manual accounting
361. Audit programme is prepared by
C. Cost accounting
D. Management accounting A. The auditor
B. The client
356. The scandal that came to light in 2001
involved audit failures at many levels by C. The audit assistant
multiple parties, including several mem- D. The auditor and his audit assistants
bers of the executive management team
and partners, auditors, and other employ- 362. How many parties are involved in the
ees at Arthur Andersen. framework for public sector accounting?
A. Shenlong A. 7
B. Eiron B. 3
C. Enron C. 5
D. Encore D. 2
357. Compensating errors are also known as 363. Investments in securities are classified as
which of the following?
A. Offsetting error A. Held-to-maturity.
B. Error of commission B. Trading securities.
C. Error of duplication C. Available-for-sale securities.
D. Error of principle D. All of the options
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 243
364. The primary purpose of establishing qual- C. government
ity control policies and procedures for de- D. none of above
ciding on client evaluation is to-
PRACTICE BOOK» NOT FOR SALE
369. Author of The Basics of IT AuditPurposes,
A. ensure adherence to generally ac-
Processes, andPractical Information.
cepted auditing standards
A. Stephen Hawking
B. acceptance or retention of clients
whose management does not lack in- B. Stephen Gantz
tegrity C. Stephen Curry
C. ensure audit fees is charged according D. Stephen King
to the type of audit work assigned
370. Error refers to an which are more
D. all of the above to be detected.
365. Misapprpriation of cash includes A. intentional act, easier
A. Cash sales B. intentional act, difficult
B. False purchase C. unintentional act, easier
C. Cash recieved from debtors D. unintentional act, difficult
D. All of the above 371. is the examination of all documentary
evidence which are available to support
366. A case where detailed vouching of select the authenticity of transactions entered in
transactions will NOT work the client’s records.
A. Existence of a weak internal control A. Accounting
system
B. Vouching
B. Improper division of duties, particu- C. Internal check
larly in a small enterprise
D. None of the above
C. Transactions of a specialized nature
D. All the Above 372. Management and other user rely on the
quantitative information provided by
367. The use of the title Chartered Accountant for decision making process.
(CA) is regulated by A. Management information systems.
A. The Securities Commission (SC). B. Accounting.
B. The federal government through the li- C. Finance
censing department of the Ministry of Fi- D. Auditing.
nance.
C. The Malaysian Institute of Accoun- 373. audit is the process of evaluating a
tants (MIA). firm’s various operating procedures, code
of conduct, and other factors to determine
D. State law through a licensing depart- its effect on the society.
ment/agency of each state.
A. Cost audit
368. Internal auditor is appointed by B. Performance audit
A. Management C. Social audit
B. shareholders D. Tax audit
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 244
374. In case of government company, the au- 379. Audit is done by a third party and
ditor is appointed by provides an independent view
A. Central Government A. Internal
B. State government B. External
C. Board of director C. Environmental
D. none of above D. none
NARAYAN CHANGDER
375. The first phase of planning an audit and 380. Key players in good corporate gover-
designing an audit approach is to nance are
A. Understand the client’s business and A. Directors and management of corpora-
industry. tion
B. Perform preliminary audit procedures. B. Audit committee members
C. Set the preliminary judgment of mate- C. Internal and External auditors
riality. D. Shareholders
D. Accept the client and perform initial au- E. All of the above
dit planning.
381. What does an auditor do?
376. Manipulation of accounts generally in- A. Provide a guarantee on the ongoing vi-
cludes ability of a company
A. 1. showing less profit B. Provide an opinion on the financial re-
B. 2. showing more profit port
C. Both 1 and 2 C. Work with management to porduce a
set of financial statements
D. None
D. Ensure that the financial report con-
377. Duties of an auditor is tains no fraud
A. Statutory duties imposed by the Com- 382. Which of the following is the best prac-
panies Act tice to implement when securing logs
B. Duties imposed by legal or court deci- files?
sions A. Log all failed and successful login at-
C. Duties arising out of professional eti- tempts.
quette B. Deny administrators access to log
D. All of the above files.
C. Copy the logs to a remote log server.
378. Which of the following is not a risk spe-
cific to IT environments? D. Increase security settings for adminis-
trators.
A. Reliance on the functioning capabili-
ties of hardware and software 383. Can take the form of reviews of live ap-
B. Increased human involvement plication systems within the user arena,
audits of application systems under devel-
C. Loss of data due to insufficient backup opment, or audits of the applications sys-
D. Reduced segregation of duties tems development process itself
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 245
A. Physical Access Audits 389. CPA Ontario should remove its general
B. Application Audits prohibition against PAs taking commis-
sions and contingent fees because
PRACTICE BOOK» NOT FOR SALE
C. Logical Access Audits
A. a CPAs prefer more price competition
D. Audits involving information system
to less.
384. Error = B. b commissions and contingent fees en-
A. Mistake hance audit independence.
B. ignorance C. c the Charter of Rights will force the
C. carelessness change anyway.
D. All of above D. d objectivity is not always necessary in
accounting and auditing services.
385. ‘An approved company auditor is a qual-
ifies person approved by the Ministry of 390. Tick ALL the types of ledgers used in com-
Finance to act as an auditor, is a good of panies.
to perform duties of an auditor under A. sales ledger
the CA Act.’ Which of the followings fit
the blank? B. acquisition ledger
A. attitude and honest C. purchasing ledger
B. knowledge and reliable D. bookkeeping ledger
C. personality and dutiful E. cash ledger
D. character and competent
391. A financial statement audit provides
386. Written opinion by a Auditor which level of assurance?
A. Audit Note Book A. A high level of assurance
B. Audit programme B. An acceptable level of assurance
C. Audit Report C. A moderate level of assurance
D. All the above D. A. A low level of assurance.
387. A detail plan of the Auditing work to be 392. The purpose of a privately-owned com-
prepared pany is to:
A. Audit Note A. Maximize shareholder value
B. Audit Programme
B. Maximize executive income
C. Audit Report
C. Whatever the owners want it to be
D. Auditor
D. none of above
388. Aditing refers to
393. is a review of operations and records
A. preparation and checking of account
undertaken in an enterprise, by specifically
B. examination of accounts of business assigned staff who will evaluate the cor-
units only rectness of the records and the effective-
C. examination of accounts of profes- ness of business operations on a continu-
sional accountant ous basis.
D. checking of vouchers A. Internal Check
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 246
B. Internal Audit A. I only
C. Routine Checking B. II only
D. Test Checking C. Both I and II
D. Neither I nor II
394. Which of the following is not internal au-
dit evidence? 399. Audit means
A. Bank Reconciliation Statement A. Recording business transactions
NARAYAN CHANGDER
B. Bank Statement B. Preparing final accounts
C. Copy of Sales Invoice C. Examination of books, accounts or
vouchers
D. Voucher
D. Decision making
395. Based on the audit procedure for non-
current liabilities, which is the correct an- 400. External audit for public sector aims
swer for inspecting supporting documents A. To achieve high level of public account-
such as invoice and receiving reports? ability.
A. accuracy B. To have clear understanding about the
B. rights and obligations organization’s strategic directions and ob-
jectives.
C. presentation and disclosure
C. To maintain or improve the efficiency
D. existence and effectiveness of internal control and
governance.
396. is essentially an environmental man-
agement tool for measuring the effects D. All of the above.
of certain activities on the environment
401. A PA’s legal licence to practice public ac-
against set criteria or standards.
counting can be revoked by which organi-
A. Environmental Auditing zation?
B. Management Auditing A. a the CPA Canada
C. Safety Auditing B. b provincial body of PAs
D. none of above C. c Auditing Standards Board
D. d provincial securities commissions
397. Implement Risk profiling and control mea-
sures occurs in which PDCA cycle. 402. Essentials of good audit report includes
A. Do A. Simplicity
B. Plan B. Clarity
C. Check C. Firmness
D. Act D. All of the above
398. Which of the following should be included 403. Auditing begins where ends
in the audit plan? I. The nature, timing and A. Selling
extent of planned risk assessment proce- B. Inventory valuation
dures. II. The nature, timing and extent
of planned further audit procedures at the C. Accounting
assertion level. D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 247
404. Analytical procedures used in planning an C. Employees
audit should focus on identifying D. None of the above
PRACTICE BOOK» NOT FOR SALE
A. Material weaknesses in the internal
control system. 409. The primary factor that should be consid-
ered in determining the extent of supervi-
B. The predictability of financial data sion needed by an assistant is the assis-
from individual transactions. tant’s
C. The various assertions that are embod- A. willingness to exercise due care
ied in the financial statements.
B. competence
D. Areas that may represent specific
risks relevant to the audit. C. professional certification
D. independence
405. A public company has to do an external
audit 410. When a PA knows that a tax client has
A. every quarter skimmed cash receipts and not reported
the income on his federal income tax re-
B. every week
turn, but he signs the return as a PA who
C. every month prepared the return, that PA has violated
D. every year which rule of professional conduct?
A. a Confidential Client Information
406. Which one of the following is more diffi-
cult to be objectively evaluated? B. b Integrity and Objectivity
A. Efficiency and effectiveness of opera- C. c Independence
tions. D. d Accounting Principles
B. Compliance with government regula-
411. threat is the threat that due to a long
tions.
or close relationship with a client or em-
C. Presentation of financial statements in ployer, a professional accountant will be
accordance with generally accepted ac- too sympathetic to their interests or too
counting principles. accepting of their work.
D. All three of the above are equally diffi- A. Familiarity
cult.
B. Self review
407. Which of the following activities would C. Advocacy
most likely be performed by EDP depart-
D. Intimidation
ment?
A. Authorising transactions 412. Which of the following factors are nor-
mally considered by the auditor in de-
B. Parity checks
termining the appropriate benchmark for
C. Distributing output the purpose of calculating overall materi-
D. Correction of transactional errors ality? I. Components of the entity’s finan-
cial statements II. Laws and regulations III.
408. Bonus shares are issued to Nature of the entity
A. New members A. I and II only
B. Existing share holders B. I and III only
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 248
C. II and III only 418. Investment in affiliated companies should
D. I, II, and III be reported as
A. Current Assets
413. Present the auditors’ report to the direc-
B. Non Current Assets
tor is one of the of auditors.
C. Current Liabilities
A. Right
D. Non Current Liabilities
B. Duties
NARAYAN CHANGDER
C. Responsibilities 419. Internal auditors must have competentin-
terpersonal skills. Which of the following
D. none of above does notrepresent an attribute of interper-
sonal skills?
414. In 1956, after the implementation of
Act audit for companies was made compul- A. Communication.
sory B. Leadership.
A. Companies C. Project management.
B. Income Tax D. Team capabilities.
C. Consitutional 420. Comfirmations are documents snet by au-
D. Labour Laws ditors to parties to confirm their bal-
ances with the client.
415. He should examine whether recognised A. internal
accounting principle have been consis-
tently B. external
A. a) Error of omission C. related
D. third
B. b) Error of commission
C. Compensating error 421. Which type of Principle of Ethic that is re-
lated for the following situation? ”profes-
D. Error of principle
sional accountants need to be sincere, hon-
416. The auditor is not liable to his client for est and straightforward in his professional
and business relationship”
A. Negligence
A. Competence and Due Care
B. Fraud
B. Integrity
C. Dishonesty
C. Confidentiality
D. Errors in application of judgement D. Objectivity
417. Is a Register Maintained by the Audit 422. All cheques, drafts, postal orders should
staff to record important points observed be cancelled on receipt by means of a
while doing Auditing stamp with a crossing
A. Audit Note Book A. Not Negotiable-A/c Payee only
B. Book keeping B. Not Negotiable
C. Book C. A/c payee only
D. All the above D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 249
423. Nontrade receivables due after one year C. Auditing
should be reported as D. None
PRACTICE BOOK» NOT FOR SALE
A. Current Assets
429. What is the first phase in the audit of fi-
B. Non Current Assets nancial statements?
C. Current Liabilities A. Gathering and Evaluating Audit Evi-
D. Non Current Liabilities dence
B. Pre-engagement Activities and Audit
424. Which of the following has the primary
Planning Activities
responsibility for the fairness of the rep-
resentations made in the financial state- C. Issuing the Audit Report
ments? D. none of above
A. Client’s management.
430. Which of the following “committees”
B. Audit Committee. have been authorized to discipline mem-
C. Independent auditor. bers in violation of the rules of profes-
sional conduct?
D. Board of Accountancy.
A. a CPA Canada Committee on Profes-
425. Cost auditor submits reports to the: sional Ethics
A. Shareholder B. b Appeals Committee
B. Board of directors C. c. Discipline Committee
C. Employees D. d Professional Conduct Committee
D. Creditors 431. Any book containing original entries of
426. Who runs the company operations for daily financial transactions.
large companies? A. account book
A. Shareholders B. journal
B. Board of Directors C. ledger
C. External auditors D. report
D. Stakeholders 432. Which one is NOT types of Audits?
427. must be and should be seen to be free A. Financial Audit
of any interest which might be regarded, B. External Audit
whatever its actual effect, as being incom-
C. Compliance Audit
patible with integrity and objectivity.
D. Performance Audit
A. Independance
B. Quality 433. Which of the following is not a risk to IT
systems?
C. Assurance
A. Need for IT experienced staff
D. Professional and due care
B. Separation of IT duties from account-
428. The latin word for audit is ing functions
A. Auditor C. improved audit trail
B. Audire D. Hardware and data vulnerability
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 250
434. Audit done by the employees of the busi- C. Insurance
ness undertaking is called D. Retail
A. Final audit
440. Which among the following is not a func-
B. Internal audit
tion of the auditor?
C. Company audit
A. Checking errors and frauds
D. Statutory audit
B. Vouching with original documents
435. Current audit file consists of
NARAYAN CHANGDER
C. Preparing final Accounts
A. Matters of future importance
D. Both a & b
B. a)Matters relations to post years
C. Matters relating to the year of audit 441. Auditor has no lien on
D. All of the above A. Audit note book
B. Audit working papers
436. The auditing standards consist of
C. Books of accounts of clients
A. Basic postulates
B. General standards D. All of the above
C. Field standards 442. Is an Audit which is conducted in between
D. All of the above two annual Audits
A. Complete Audit
437. What are the nature and scope of audit
work? B. Internal Audit
A. Reasonable precautions to safeguard C. External Audit
collection and custody of public money.
D. Interim Audit
B. Payments made with proper authority
supported by sufficient vouchers. 443. Review the following documents to gain
evidence if client entity is a going concern.
C. Due care has been taken into account
for proper use, control, maintenance and A. terms of loan notes or debentures
disposal of all public stores. B. cash flows forecast
D. All of the above.
C. correspondences with banks and sup-
438. Management accounts in large companies pliers
are prepared: D. latest interim financial statements
A. yearly
444. A transaction is recorded in the books
B. monthly only when a documentary evidence is
C. quarterly available to support the transaction. That
D. weekly documentary evidence is known as
A. Voucher
439. Which is considered a specialized indus-
try? B. Cash Memo
A. Merchandising C. Pay-in-slips
B. Manufacturing D. All of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 251
445. Audit experts can help you with and independence rules for firms regis-
A. Achieve high levels of accuracy book- tered with the Board to conduct audits of
public companies.
PRACTICE BOOK» NOT FOR SALE
keeping
A. PCOAB
B. Improve the way you manage your bud-
gets and cost accounting B. PCBAO
C. Buy or sell other companies C. PBCAO
D. Prepare for future changes in tax reg- D. PCAOB
ulation
451. IFRS 9:Financial InstrumentsIFRS
446. Find a synonym to the word “disrup- 16:LeasesIFRS 17:Insurance Contract-
tive”: sIFRS 41:?
A. troublemaking A. Revenues
B. vital B. Agriculture
C. enable C. Investment Property
D. None of the choices
D. subjective
452. When the auditor is an employee of the
447. Failure to detect material monetary er-
organization being audited, the audit is
rors in the financial statements is a risk
classified as
that the auditor mitigates primarily by
A. Internal
A. performing tests of controls
B. External
B. obtaining representation letter
C. Compliance
C. performing substantive tests
D. Both A & B
D. evaluating internal control
453. Company A hired Sampson & Delila, CPAs,
448. Vouching is an device. to audit the financial statements of Com-
A. Mechanical pany B and deliver the audit report to
Megabank. Which is the client?
B. Intelligent
A. Megabank
C. Reliability
B. Sampson & Delila
D. none of above
C. Company A
449. If a casual vacancy in the office of auditor D. Company B
arises by his resignation it should only be
filled by the company in a 454. Obtain sufficient appropriate evidence re-
garding the appropriateness of of the
A. Board meeting
going concern basis of accounting in the
B. extraordinary general meeting preparation of the financial statements.
C. General meeting A. management’s estimation
D. Annual general meeting B. management’s judgement
450. A governing body established by the C. management’s use
Sarbanes-Oxley Act, also mandates ethics D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.4 Auditing 252
455. Which of the following is a record of the B. no, the monitoring process is not run
tracked actions of users? on a regular basis
A. Performance Monitor C. no, the monitoring process is run on a
B. Audit Trails regular basis
C. Permissions D. yes, the monitoring process is run on
a regular basis
D. System and event logs
460. The objective of the audit planning is
NARAYAN CHANGDER
456. What are the three factors in “the fraud
triangle” A. To give appropriate attention to all im-
portant areas of audit
A. Incentive, manipulation, rationaliza-
tion B. To identify potential problems
B. Opportunity, pressure, incentive C. To coordinate work with other auditors
and experts
C. Incentive, opportunity, rationalization
D. All of the above
D. Opportunity, skepticism, rationaliza-
tion 461. You have established a baseline for your
server. Which of the following is the best
457. Which of the following is true about ac-
tool to use to monitor any changes to that
counting?
baseline?
A. Accounting is resoonsibility of manage-
A. Performance Monitor
ment
B. Anti-spyware
B. Accounting is responsibility of owners
of company C. Antivirus software
C. Accounting is responsbiliy of auditor D. Vulnerability assessments software
D. Accounting is responsibility of both ac- 462. A symbol or word legally Registered es-
countant and audtior tablished by use us Representing a Com-
458. Which one is not the duty of public sector pany or Product
organisations? A. Patent
A. Maintain proper accounting system B. Trade Mark
and practice.
C. Copy Right
B. Perform record keeping.
D. Goodwill
C. Review statements and provide any re-
lated comments. 463. The minimum required phases and con-
siderations within SDLC phases are
D. Prepare financial statements at the
if the system or software development
end of the day.
deals with data in any way.
459. Is the monitoring process conducted A. mandatory; Level 0
within the validity period of halal certifi-
B. optional; Level 1
cation?
A. yes the monitoring process is not run C. optional; Level 0
on a regular basis D. mandatory; Level 1
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 253
464. Which type of Principle of Ethic that is B. 5
related for the following situation? ”Au-
C. 10
ditor need to maintain attitude of impar-
PRACTICE BOOK» NOT FOR SALE
tiality and do not be bias toward the com- D. 20
pany”
467. Subscription Receivable collectible be-
A. Confidentiality
yond 12 months shall be treated as
B. Integrity
A. Current Assets (Receivables)
C. Professional Behaviour
B. Addition to Subscribed Share Capital
D. Objectivity
C. Deduction to Subscribed Share Capital
465. Who is responsible for the appointment
of statutory auditor of a limited com-
pany? D. none of above
A. Directors of the company 468. The auditor shall assemble the audit doc-
B. Members of the company umentation in an audit file within days
of completion of audit.
C. The Central Government
D. All of the above A. 60 days
B. 90 days
466. How many types of error are there in au-
diting? C. 180 days
A. 2 D. 30 days
1.5 Business Economics
1. Which type of business allows the owner 3. The difference between what a consumer
to keep all of the profit for him/herself? is ready to pay and what he actually pays
A. Partnership is:
B. Franchise A. Consumer Surplus
C. Sole Trader B. Consumer deficit
D. Limited Company C. Both
D. None
2. Why are resources considered limited?
A. Everyone has them, and they change. 4. If a customer shops at your store because
it is on his way home from work, which
B. Entrepreneurs do not invest enough of utility is involved
them.
A. Place
C. There are so many that people must
decide which ones to choose at any one B. Form
time. C. Possession
D. There are not enough available so that D. Time
everyone can have as much of them as de-
sired. 5. When was Niti Aayog established?
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 254
A. 1 January 2015 C. Sole proprietorship
B. 25 January 2016 D. None of these are correct
C. 14 May 2014
11. For consumption to occur, goods and ser-
D. 1 July 2015 vices must be
6. What is NOT a source of income? A. specialized.
A. Social welfare payments B. improved.
NARAYAN CHANGDER
B. Profit from capital C. exchanged.
C. Wage from labour D. produced.
D. Rent from land
12. A is a semi-independent business that
7. A target market is pays fees to a parent company.
A. a market available at target A. Proprietorship
B. a group of people who all buy the exact B. Partnership
same goods and services
C. Corporation
C. a group of producers who have similar
interests and therefore join in a partner- D. Franchise
ship business
13. An increase in the average prices of goods
D. a group of customers with similar char-
and services in a country.
acteristics towards which a business has
decided to aim its marketing efforts and A. deflation
its products B. inflation
8. Products and services are bought and sold C. market price
at a/an
D. demand price
A. arena
B. black-market 14. The target rate for inflation is?
C. marketplace A. 1-2%
D. stalls B. 2-3%
9. Land, Labor, Capital, and Entrepreneurship C. 3-4%
A. Diversification D. 4-5%
B. Deductions 15. What do consumers, producers, and the
C. Portfolio owners of resources do with money pay-
D. Factors of Production ments to create a flow of resources, goods,
services, and money payments?
10. Of the three types of businesses, which A. Exchange
one provides the most jobs? (Hint:Which
one is the most common? ) B. Distribute
A. Corporation C. Produce
B. Partnership D. Consume
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 255
16. Exports are A. command economy
A. goods and services that are purchased B. mixed economy
PRACTICE BOOK» NOT FOR SALE
from overseas businesses C. market economy
B. goods and services that are exported D. none of above
to overseas governments
21. Goods and services are produced using
C. goods and services that are sold do-
mestically to the household sector A. Needs
D. goods and services sold by local busi- B. Wants
nesses to overseas consumers C. Economic Problem
17. Law of demand shows relation between: D. Economic Resources
A. 1.Income and price of commodity 22. Oil, water, and wood are examples of
resources.
B. 2.Price and quantity of a commodity
A. Land
C. 3.Income and quantity demand
B. Labor
D. 4.Quantity demanded and quantity sup-
plied C. Capital
D. Entrepreneurship
18. What is Business Studies?
A. This is the study of how businesses are 23. the result of merging companies that pro-
formed, how they grow & how the oper- duce unrelated goods and services
ate/managed. A. horizontal merger
B. This is the study of how human be- B. conglomerate
ings behave as they satisfy their unlimited C. depreciation
wants and needs.
D. multinational
C. This is the value of the next best alter-
E. vertical merger
native forgone.
D. none of above 24. Under capitalist economies, the answer to
the fundamental questions-what, how and
19. Labour is for whom to produce are obtained by-
A. the human process of manufacturing A. Government regulation
goods and services B. Cost benefit analysis
B. the human skills and effort required in C. Market forces of demand and supply
the production process
D. All of the above.
C. the human skills required to acquire
raw materials 25. What is the focus of Microeconomics?
D. the human skills and effort required to A. How businesses make decisions
manufacture goods and services B. How government manages the econ-
omy
20. The type of government where the govern-
ment or a central-planning committee reg- C. How individual consumers and firms
ulates the amount, distribution, and price make economic decisions
of everything produced. D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 256
26. What does the scarcity of resource implies B. Increase due to the growth of the in-
dustry as a whole
A. We must develop way to decrease our C. Generate lower per unit production
individual wants costs
B. Not all wants can be satisfied. D. Reduce production costs in the short
C. Resources can not satisfy any want run
D. Resources are very scarce and shall 32. The value of one nation’s currency versus
NARAYAN CHANGDER
not be used at all the currency of another nation is called
27. Labour intensive technique would get cho- A. growth
sen in B. recession
A. Capital surplus economy C. balance of payments
B. Labour surplus economy D. exchange rate
C. Developed economy
33. What Hong Kong’s sky-high home prices
D. Developing economy mean for investors (select three)
28. Capitalist economy is also known as- A. Business news
A. Controlled market economy B. Economic news
B. Free market economy C. Microeconomics
C. Both (1) and (2) D. Macroeconomics
D. Neither (1) Nor (2) 34. Is time an investment?
29. voluntary association that buys bulk A. undecided
amounts of goods on behalf of its mem- B. yes
bers
C. no
A. unlimited liability
D. none of above
B. depreciation
C. partnership 35. Which economic system is based on cus-
toms and beliefs?
D. consumer cooperative
A. Traditional System
30. Indifference curves between income and
B. Market System
leisure for an individual are generally:
C. Mixed System
A. Concave to the origin
D. Command System
B. Convex to the origin
C. Negatively sloped straight lines 36. Deflation is defined as a decline in the
D. Positively sloped straight lines A. price of certain products.
B. general price level..
31. Economies of scale are those that
A. Result from changes in production C. gross domestic product
techniques D. innovation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 257
37. Economics is “On the one side, a study of 42. is the base of marketing planning
wealth; and on the other, and more impor-
A. Demand Estimation
tant side, part of a study of man”. This is
PRACTICE BOOK» NOT FOR SALE
stated by B. Demand analysis
A. Adam Smith C. Demand function
B. Alfred Marshall D. Demand forecasting
C. Robbins
D. Samuelson 43. which is a disadvantage of corporations?
A. difficulty of raising financial capital.
38. Sole proprietorship can best be defined as
B. the difficulty and expense of getting a
A. a business owned and run by a single charter
individual C. lack of separate taxes in a partnership
B. Business organization recognized by D. potential for conflict between partners
law as separate legal entity with all the
rights of an individual 44. Things require to survive are categorised
C. two individuals owning stock as
D. stockholders joined under contract A. Demands
39. Horizontal mergers involve B. Wants
A. two or more firms in different coun- C. Needs
tries.
D. Desires
B. two or more firms that produce the
same kind of product.
45. is a branch of economics that deals
C. two or more firms involved in different with aggregate economic variables, such
steps of manufacturing or marketing. as the level and growth rate of national
D. two or more firms that produce differ- output, interest rates, unemployment and
ent products. inflation
40. is the price that equates quantity supplied A. 1. Microeconomics
to the quantity demanded B. 2. Statistics
A. 1.equilibrium price C. 3. Macroeconomics
B. 2.surplus
D. 4. Market Economies
C. 3.shortage
D. 4. none of the above 46. This is a method used by a business to
find attributes that is important and to set
41. Parastatals are business entities of a them apart itself from its competitors.
sector.
A. differentiation
A. commercial
B. private B. cost leadership
C. public C. alliance
D. sector D. defensive strategy
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 258
47. The four (4) participants in our economy B. Need
are C. Producer good
A. Consumers, Producers, Employees, D. Consumer
Governments
B. Producers, Consumers, Students, Gov- 52. A study of how increase in the corporate
ernments income tax rate will affect the national un-
employment rate isan example of
C. Households, Firms, Governments, Em-
A. Macro-Economics.
NARAYAN CHANGDER
ployees
D. Consumers, Producers, Households, B. Descriptive Economics.
Employees C. Micro-economics.
48. Country with little economic wealth and an D. Normative economics.
emphasis on agriculture or mining.
53. Internal things that may limit a company’s
A. less-developed country ability to achieve it’s goals would be
B. developing country known as a
C. industrialized country A. strength
D. none of above B. weakness
C. opportunity
49. A command economic system is character-
ized by: D. threat
A. reliance on the forces of supply and de- 54. A is a check that transfers a portion of
mand to determine what is produced. the corporate earnings to an individual.
B. reliance on the government to deter- A. Stock
mine what is produced and who gets the
B. Dividend
output.
C. Payment
C. an extremely rapid rate of economic
growth. D. Bonus
D. freedom of choice and freedom of com- 55. What is the fundamental problem of eco-
petition. nomics?
50. Two local business owners want to reduce A. How to keep consumers out of debt?
competition, so they decide to form one or- B. How to fulfill our unlimited wants and
ganization from the two companies. This needs with limited resources?
is an example of a
C. How to figure out the way to make the
A. monopoly. most money?
B. hostile takeover. D. How do we ensure all people get a col-
C. merger. lege education?
D. trading bloc. 56. A garbage truck driver is an example of
51. Something we must have in order to sur- which Factor of Production?
vive A. labor
A. Want B. land
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 259
C. entrepreneurship 62. This factor of production are the raw ma-
D. capital terials that come from the earth.
PRACTICE BOOK» NOT FOR SALE
A. Human Resources
57. Which of the following is NOT one of the
five types of businesses B. Natural Resources
A. Manufacturing C. Capital
B. Wholesaling D. Entrepreneurship
C. Service
63. A fall in the value of a currency due to fac-
D. Selling
tors such as weaker economic fundamen-
58. Anything that can be bought and sold. tals is termed
A. Factors of Production A. exchange rate appreciation
B. Customer B. exchange rate depreciation
C. Product C. exchange rate valuation
D. none of above D. exchange rate extrapolation
59. The condition of consumer equilibrium un-
der cardinal approach in case of one com- 64. Which one of the following is correctly
modity is matched?
A. price of commodity should be rising A. Wealth of Nations-Marshall
B. price of commodity should equal to be B. Principles of Economics-Crowther
marginal utility
C. Ten Great Economists-J. A. Schum-
C. price of commodity should be decreas- peter
ing
D. An Outline of Money-J.M. Keynes
D. none of these
65. Which of the following is an advantage of
60. A type of stock without voting privileges
general partnerships:
A. preferred
A. Limited capital
B. common
B. Unlimited liability
C. uncommon
D. dividend C. Easy to end
D. Combined capabilities
61. Consider the following and decide which, if
any, economy is without scarcity:
66. Who or what answers the basic economic
A. The pre-independent Indian economy, questions in a market economy?
where most people were farmers.
A. Individuals and Businesses
B. A mythical economy where everybody
is a billionaire. B. Government
C. Any economy where income is dis- C. Customs
tributed equally among its people. D. Individuals, Businesses and Govern-
D. None of the above. ment
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 260
67. According to the article, what will you 73. In a mixed economy
have to do when setting up a business BE- A. All economic decisions are taken by
FORE your very first transaction? the central authority.
A. get money B. All economic decisions are taken by
B. sell goods private entrepreneurs.
C. spend money C. Economic decisions are partly taken
D. count your money by the state and partly by the private en-
NARAYAN CHANGDER
trepreneurs.
68. Hard to raise funds to start and expand D. None of the above.
A. Sole Proprietorship and Corporation
74. Why would a company need to issue
B. Sole Proprietorship stock?
C. Partnership and Corporation A. To increase its’ customer base.
D. Corporation B. To raise money.
69. What happens when demand is bigger C. To stop the government from regulat-
than supply? ing it.
A. Deflation D. To show customers that it’s success-
B. Surplus ful.
C. Demand 75. In which economic system does the govern-
D. Shortage ment have the most control over economic
resources?
70. According to Robbins, Economics is a A. Mixed
A. Normative science B. Command
B. Positive science C. Market
C. Natural science D. Traditional
D. Social science
76. What is one force that hinders, or stops,
71. Which of the following is NOT a business economic growth in poorer countries?
organization? A. Corruption
A. Sole Proprietorship B. The Force
B. Corporation C. Weather
C. Perfect Competition D. Women
D. Partnership
77. An economy where there is a blend be-
72. List any THREE examples of eco-tourism in tween government involvement in busi-
South Africa. ness and private ownership.
A. forest A. command economy
B. economy B. market economy
C. bussiness cycle C. mixed economy
D. none of above D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 261
78. Which of the following people would tend 82. The four government objectives are low
to favor a socialist economy? inflation, low unemployment, balance of
payments and
PRACTICE BOOK» NOT FOR SALE
A. John wants to live in a country with low
marginal tax rates. A. Safe defence spending
B. Robin wants to live in a country that en- B. Economic growth
courages rapid economic growth C. High interest rates
C. Liz wants to live in a country with lim- D. Low tax revenue
ited government regulation
D. Fred prefers to live in a country that 83. Which of the following is not the problem,
promotes social equality a country will have to face due to rapid
inflation
79. Which one of the following is the correct A. Real income will fall
definition of Economics?
B. Increase in prices of produced goods
A. How the limited resources are allo-
cated to satisfy human wants C. more jobs will be created
B. How individuals, consumers and firms D. living standard will fall
make economic decisions
84. demand forecasting is related to the
C. How a government manages its do- business conditions prevailing in the econ-
mestic economy, and how the global econ- omy as a whole
omy operates
A. Macro level
D. How a business is organised and run
B. Industry level
to achieve its corporate goals
C. Firm level
80. What is the principle that producers are D. None of these
entitled to make more money from a busi-
ness than they invest 85. The current economic system in the U.S. is
A. profit motive
B. free enterprise A. Mixed (Market/Command)
C. capital stock B. Mixed (Market/Traditional)
D. risk and reward C. Command
D. Traditional
81. Mark, a sole trader, has been trading for
five years. A sole trader has unlimited lia- 86. The quantity of a good or service that pro-
bility. It means that he ducers are willing and able to offer for sale
A. works on his own. at a particular price during a specific time
period.
B. can only hire a limited number of em-
ployees. A. Supply
C. is personally responsible for all busi- B. Demand
ness debts. C. Price
D. cannot get a bank loan. D. Production Cost
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 262
87. Macro economics is derived from the Greek B. Partnership
word
C. Corporation
A. Mikros
D. Franchise
B. Micro
C. Makros 93. I sell 10 bowls of cereal at $5 each, my
revenue is
D. None of these
A. $50
NARAYAN CHANGDER
88. A science that examines how goods and
B. $5
services are produced, sold, and used.
C. $10
A. Factors of Production
B. Capitalism D. $15
C. Profit 94. An increase in the labor force would cause
D. Economics the PPF to
A. Shift inward
89. What is microeconomics?
A. Economics that looks at the behavior B. Shift outward
of people and organizations in particular C. Do nothing
markets.
D. Turn into a straight line
B. Very tiny economics.
C. Economics that looks at the operation 95. Large business are usually able to nego-
of a nation’s economy as a whole. tiate lower repayments on loans. What
economy of scale is this?
D. none of above
A. Financial
90. A is business owned and run by a sin-
B. Marketing
gle individual.
C. Managerial
A. Sole Proprietorship
B. Partnership D. Purchasing
C. Corporation 96. Who is called the father of economics?
D. Franchise A. Max Muller
91. Micro economics approaches the study of B. Karl Marx
economics from the view point of
C. Adam Smith
A. Individual or specific markets
D. None of these
B. World Markets
C. Economy wide effects 97. Which of these is not a major macroeco-
nomic objective of governments?
D. The national economy
A. Low and stable inflation
92. A is a form of business organization
B. Increasing pofitability of companies
recognized by law as a separate legal en-
tity with all the rights of an individual. C. Full employment
A. Proprietorship D. High and sustainable growth
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 263
98. Bulk buying for discount is which type of C. Limited Company
economy of scale? D. Franchise
PRACTICE BOOK» NOT FOR SALE
A. Managerial
104. What implication(s) does resource
B. Purchasing scarcity have for the satisfaction of
C. Technical wants?
D. Financial A. Not all wants can be satisfied.
B. We will never be faced with the need
99. refers to a general rise in the price to make choices.
level of goods and services over time.
C. We must develop ways to decrease
A. Acceleration our individual wants.
B. Recession D. The discovery of new natural re-
C. Inflation sources is necessary to increase our abil-
ity to satisfy wants.
D. Escalation
105. APC stands for:
100. Which of the following is NOT one of the
A. Average Proportion to Consume
6 basic business activities
B. Average Propensity to Consume
A. Generate Ideas
C. Alternate Propensity to Consumption
B. Buy Goods and Services
D. Average Propensity of Consumers
C. Maintain Records
106. Alfred Marshall ‘s Master piece “The
D. Compete with other businesses Principles of Economics” in
101. What is a disadvantage of the economic A. 1969
system in the previous question? B. 1776
A. Strong social network C. 1932
B. Lack of current technologies D. 1890
C. Weak social network 107. What is NOT a factor affecting consumer
D. Inequities in wealth choice (of which g/s to buy)?
A. Their taste and preference
102. What happens as a person’s or econ-
omy’s income rises? B. Their income
A. They spend less C. The price of substitutes or comple-
ments
B. They spend proportionately more
D. All of the above
C. They save proportionately more
108. Which of the following products will be
D. They save proportionately less most likely affected by an increase in in-
103. Which business depends on just one per- come tax?
son for the skills and talents to run the A. Petrol
business? B. Salt
A. Sole Trader C. Jewellery
B. Partnership D. Bread
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 264
109. What you make when you give some- C. Robbins
thing up to have something else. D. A.C. Pigou
A. Trade-off
115. Advantages of this type of business in-
B. Demand clude:easy to start, and you can rely on a
C. Needs good company name and expertise.
D. Wants A. Sole Proprietorship
110. A person who buys and uses goods and B. Partnership
NARAYAN CHANGDER
services. C. Corporation
A. Wants D. Franchise
B. Trade-off 116. This business takes raw materials and
C. Consumer mass produces goods. Usually it uses
D. Market Economy robots, computers, assembly lines, and hu-
man labor to make goods.
111. A charter is a government document that A. Proprietorship
gives permission to create a
B. Partnership
A. Proprietorship
C. Merchandising Business
B. Partnership
D. Manufacturing Business
C. Corporation
D. Franchise 117. Which of the following is a possible cause
of diseconomies of scale?
112. Asda would be classified as A. similar businesses in the area
A. small B. easy access to suppliers
B. small/medium C. greater distance between senior staff
C. large and shop floor workers
D. none of above D. abundance of skilled labour
113. In every economic system, scarcity im- 118. A country with a strong business activ-
poses limitations on ity that includes advanced technology and
A. households, business firms, govern- a highly educated population.
ments, and the nation as a whole A. developing country
B. households and business firms, but B. less-developed country
not the governments C. industrialized country
C. local and state governments, but not D. none of above
the federal government
D. households and governments, but not 119. What is a corporate structure in the
business firms United States whereby the owners are not
personally liable for the company’s debts
114. Marginal utility approach was given by: or liabilities?
A. J.R. Hicks A. Manufacturing business
B. Alfred Marshall B. Corporation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 265
C. Limited Liability Company 125. High levels of unemployment combined
D. Hybrid Business with high levels of inflation could indicate
that the business cycle has entered into a
PRACTICE BOOK» NOT FOR SALE
120. utility is added when a business period of-
changes the form of a good or service to
A. recession
make it more useful.
A. Possession B. stagflation
B. Time C. expansion
C. Form D. investment
D. Place
126. Define productivity
121. Xiaomi launches $10bn Hong Kong stock
market listing. A. Amount of g/s produced per unit of re-
sources
A. Business news
B. Cost of g/s produced
B. Economic news
C. Microeconomics C. Total amount of g/s produced
D. Macroeconomics D. Increase in quantity of g/s produced
122. In Economics, we use the term scarcity to 127. sum of net income and non-cash charges,
mean; such as depreciation
A. Absolute scarcity and lack of re- A. net income
sources in less developed countries.
B. corporation
B. Relative scarcity i.e. scarcity in rela-
tion to the wants of the society. C. cash flow
C. Scarcity during times of business fail- D. limited life
ure and natural calamities.
D. Scarcity caused on account of exces- 128. curve represents all combinations
sive consumption by the rich of market baskets that provide consumer
with the same level of satisfaction.
123. Australia’s biggest trading partner is
A. 1.demand curve
A. USA
B. Japan B. 2.indefference curve
C. Mongolia C. 3.supply curve
D. China D. 4.none of the above
124. Michelle is trying to decide which goods 129. The quantity of a good or service that con-
and services to purchase so that she can sumers are willing and able to buy.
get maximum satisfaction. Michelle is
A. Economic System
A. creating scarcity.
B. economizing. B. Market Price
C. increasing distribution. C. Demand
D. a producer. D. Needs
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 266
130. What is the purpose of government within 5 miles of your store. This would
taxes? be considered a
A. Fund the income of politicians A. Strength
B. Provide money for public goods and B. weakness
services
C. opportunity
C. Provide money for public perfor-
mances D. threat
NARAYAN CHANGDER
D. Supplement big businesses 136. what is a subsistence economy?
131. The expansion of micro economics into A. an economy directed to basic subsis-
other social sciences has caused economics tence rather then to the market
to be called as the B. type of economic system where invest-
A. Imperialist social science ment, production and the allocation of cap-
ital goods take place
B. Queen of social science
C. an economic system in which pri-
C. Traditional social science
vate individuals or businesses own capital
D. Inter disciplinary social science goods
132. The word ‘Economics’ has the origin D. none of above
A. Roman 137. Disadvantages of this type of business
B. French include:company is taxed on profits, reg-
C. Greek ulated by the government, and hard to
start.
D. European
A. Sole Proprietorship
133. List any THREE methods that can be used B. Partnership
to promote importsubstitution.
C. Corporation
A. Gdp
D. Franchise
B. market price
C. economy 138. What is the abbreviation for PPC?
D. subsidies A. Possibility Production Curve
134. What are Wants? B. Production Possibility Curve
A. These are goods and services which C. Production Possible Choice
human beings cannot live without. D. Possibility Production Frontier
B. These are goods and services which
human beings desire but can live without. 139. Where do people buy most goods?
C. All the above. A. Farms
D. none of above B. Stores
C. Trucks
135. You are conducting a SWOT analysis and
find out that a new competitor is opening D. Factories
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 267
140. The method a country uses to answer the 145. A nonprofit agency sponsored by local
three Economic questions. businesses that helps to resolve disputes
between consumers and sellers.
PRACTICE BOOK» NOT FOR SALE
A. Needs
B. Goods A. Federal Trade Commission (FTC)
C. Supply B. Walmart
D. Economic System C. Better Business Bureau (BBB)
141. What is the main role of government in- D. none of above
tervention in the economy?
146. This type of business is a contractual
A. To discourage enterprise and reduce agreement with a parent company to sell
foreign investment its products/services in an area.
B. To protect the workforce and the envi- A. Sole Proprietorship
ronment and to promote competition
B. Partnership
C. To ensure that business is conducted
in such a way that local businesses always C. Corporation
win D. Franchise
D. To prevent consumers from accessing
147. Why do all societies have to make deci-
what the economy produces
sions about how resources will be used?
142. Anything that is bought or sold is called A. People are greedy
a(n)
B. There are not enough resources for
A. Item those who want them
B. Service
C. Resources are too expensive for most
C. Business people
D. Product D. Because there is a huge gap between
the rich and poor
143. Macro Economics deals with
A. External value of money 148. The value of the next best option that is
B. Employment and economic growth not selected is
C. General price level A. profit
D. all of above B. standard of living cost
C. opportunity cost
144. Which one of the following best defines
the term stakeholder? D. time utility
A. An owner of a private limited company 149. A Service refers to:
B. Someone with an interest in the suc-
A. Physical things you can see and touch
cess of a business
B. An action or skill that someone does
C. Any individual who takes decisions
for you
within a business
C. A business
D. An individual who is a part owner in a
business D. Physical things that you can buy
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 268
150. Who controls the cash rate (interest rate) D. New technologies create new job op-
in Australia? portunities
A. RBA 155. Jared has two hours before having to go
B. CBA to his part-time job. He is deciding be-
C. Australian Government tween studying for a math exam and tak-
ing a nap. If Jared chooses to take a nap,
D. Qld Government the opportunity cost of his decision is
151. A large business/enterprise would have A. the rest he is getting
NARAYAN CHANGDER
B. the score he will earn on the math
A. 10-49 persons employed. exam
B. 250 or more persons employed. C. the wages from his part-time job
C. 50-249 persons employed. D. all of the above
D. less than 10 persons employed. 156. The quantity of a good or service that
businesses are willing and able to provide.
152. In what way does specialization increase
productivity? A. Producers
A. Specialization reduces scarcity B. Traditional Economy
B. a. Specialization reduces the cost of C. Supply
production. D. Market Price
C. a. Specialization increases the de- 157. Teachers, construction workers, and me-
mand for a product. chanics are examples of
D. a. Specialized workers are generally A. Land
more highly educated.
B. Labor
153. Dan has $5, 000. He wants to invest C. Capital
his money in the type of business that will
D. Entrepreneurship
not take his personal assets if the business
fails. In which type of business should he 158. A contest among sellers to win cus-
invest? tomers.
A. corporation A. Monopoly
B. partnership B. Competition
C. proprietorship C. Bait and switch
D. none of above D. none of above
154. Which is NOT a benefit of technological 159. It operates as a separate, legal body lead
change? by an elected board of directors, the board
is elected by shareholders, the owenera of
A. Production method becomes more effi-
the
cient, increases profit
A. Sole Proprietorship
B. Allow consumers to search and com-
pare prices B. Partnership
C. Machinery replace labour, causing un- C. Corporation
employment D. Cooperative
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 269
160. What is the Economic Problem? B. Extra cost of production
A. There are unlimited resources to sat- C. The condition that results form having
PRACTICE BOOK» NOT FOR SALE
isfy our limited needs and wants unlimited wants with limited resources
B. It is very difficult to learn D. Rise in general level of prices and
C. There are too many producers and not workers need more money
enough consumers
166. If my total costs are $50 and my total
D. There are limited resources to satisfy revenue is $80, what is my profit
our unlimited needs and wants
A. $130
161. What is an example of a service? B. $80
A. A bus journey C. $30
B. a bus A bus D. $400
C. a bus stop A bus stop
167. Willingness to pay for the want is
D. none of above
A. Need
162. A is anywhere buyers and sellers B. Desire
meet to buy and sell goods and services.
C. Demand
A. Store
D. Show off
B. Workplace
C. Restaurant 168. Normally a demand curve will have the
shape:
D. Market
A. 1.horizontal
163. Julie buys used clothes at garage sales B. 2.vertical
and then auctions them off herself off the
internet. Which type of business does she C. 3.downward sloping
have? D. 4.upward sloping
A. partnership
169. The main advantage of a is the ease
B. proprietorship of raising financial capital.
C. corporation A. Proprietorship
D. conglomerate B. Partnership
164. Most governments operate under this C. Corporation
type of economic system. D. Franchise
A. Command System
170. The type of business ownership in which
B. Mixed System all business decisions are the sole respon-
C. Traditional System sibility of the owner.
D. Market System A. Sole proprietorship
165. What is scarcity? B. Partnership
A. Giving something up to have some- C. Corporation
thing else D. Franchise
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 270
171. Which of the following is the cause of cen- 177. Pigou was an ardent supporter of
tral economic problem? A. Wealth definition
A. Scarcity of recourses B. Welfare definition
B. Unlimited wants C. Scarcity definition
C. Alternative use D. Growth definition
D. All of the above
178. Which of the following is a basic right un-
der capitalism?
NARAYAN CHANGDER
172. If elasticity of demand is very low it
shows that the commodity is: A. freedom from taxation
A. 1.necessity B. Freedom of collusion
B. 2.luxuary C. The right to vote
C. 3.Has little importance in total budget D. The right to compete
D. 4.none of the above 179. Disadvantages include unlimited liability,
173. In economics ‘Ends’ refers to difficult to raise financial capital, difficulty
attracting qualified employees, limited life
A. Human wants
A. Sole Propriotorship
B. Scarcity
B. Bananas
C. Surplus
C. Corporation
D. Alternative uses
D. Franchise
174. Pets at Home PLC sells shares on the
180. What is a shareholder?
Stock Exchange to members of the public.
They are a type of ? A. The owner of any business
A. Sole Trader B. A group of companies
B. Private Limited Company C. A person who provides a service
C. Public Limited Company D. Individual or groups who own shares
in a company
D. Franchise
181. Into what two categories can wants be
175. Central Problems arises in case of divided?
A. Capitalist Economy A. Unlimited and noneconomic
B. Socialist Economy B. Economic and noneconomic
C. Mixed Economy C. Unlimited and limited
D. All of the above D. Unlimited and economics Economic
and noneconomic
176. Which of the following is not a central
economic problem? 182. Which business is not a franchise?
A. What to produce? A. McDonalds
B. When to produce? B. Hungry Jacks
C. How to produce? C. Nike
D. For whom to produce? D. Boost
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 271
183. Economic stress has led to downsizing. C. paying taxes to government
This has led to: D. competing with other businesses
PRACTICE BOOK» NOT FOR SALE
A. Increased work hours
189. Which of the following is not the function
B. Less part time workers of the Niti Aayog?
C. Less contingent workers A. To evolve a shared vision national de-
D. none of above velopment priorities sectors & strategies.
184. Which of the following involves Business B. To foster cooperative federalism
decision making? C. To give final approval to the Five year
A. Continue or shut down decision plans of India
B. Launching of new product D. To create a knowledge, innovation &
entrepreneurial support system.
C. Proper debt and equity mix
D. All of the above 190. A cooperative is
A. a business that is owned and operated
185. A major benefit of socialism is the: by the group of people that it serves
A. ability to stimulate rapid economic B. a business with one operator
growth
C. a business which sells shares on the
B. ability to keep taxes low ASX
C. emphasis on social equality D. a business operated by the public
D. emphasis on private enterprise in-
stead of public ownership 191. The term “derived demand” means
A. demand for secondary products only
186. The private ownership of economic re-
sources by individuals rather than by the B. demand that is dependent on govern-
Government. ment supplying the product
A. Consumer C. demand that arises because the sup-
ply of the good is reduced
B. Capitalism
D. demand that arises because there is
C. Demand demand for another good.
D. Economic System
192. Which is NOT a question all societies
187. Which of these protects music, books, po- have to answer due to scarce resources?
ems, architecture, films and artwork? A. When will products be produced?
A. Copyright B. How will products be produced?
B. Trademark C. What products will be produced?
C. Utility Patent D. Who will gets access to the resources
D. Design patent and the products they produce?
188. Which of the following is NOT one of the 193. The word ‘Economics’ originates from the
five roles of business word
A. Providing employment A. Oikomnomikos
B. Stimulating economy B. Oikonomia
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 272
C. Eikonomikos 199. exists when the entire supply of a
D. Ekconomics good is controlled by a single seller.
A. perfect competition
194. Your leading product has a 30% market B. oligopoly
share which is 10% higher than your best
competitor. Where would you analyze this C. pure capitalism
information in SWOT analysis? D. a monopoly
A. Weaknesses 200. McDonald’s and Burger King are exam-
NARAYAN CHANGDER
B. Strengths ples of
A. Sole Trader
C. Threats
B. Partnerships
D. Opportunities
C. Limited Company
195. Characteristics include owned by two or D. Franchises
more people and may be general or limited
201. The concept of marginal utility decreasing
A. Sole Propriotorship with the increase in amount consumed of a
B. Partnership commodity is called
C. Corporation A. Diminishing marginal returns
D. Franchise B. Diminishing marginal utility
C. Diminishing total utility
196. are essential, while just add to
D. Diminishing total returns
the quality of life.
202. Of the following which is an ADVANTAGE
A. Goods, services
of increased competition?
B. Needs, wants
A. higher prices
C. Products, services B. increased variety
D. Wants, needs C. declining customer service
197. Normally a supply curve will have the D. lower quality
shape: 203. What words describes too much of a
A. 1.horizontal product in the market?
B. 2.vertical A. Scarcity
B. Surplus
C. 3.downward sloping
C. Shortage
D. 4.upward sloping
D. Supersized
198. When people are employed on short term
204. A significant decline in general economic
contracts it is an example of:
activity in a designated region is called
A. Command Economy A. expansion
B. Casualisation B. economic growth
C. Outsourced Labour C. recession
D. Full-time work D. gross domestic product
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 273
205. Can exist indefinitely A. Proprieter
A. Partnership B. Partner
PRACTICE BOOK» NOT FOR SALE
B. Sole Proprietorship C. Entrepreneur
C. Corporation D. Incorporater
D. Partnership and Corporation 211. A corporation is
206. Which TWO of the following are exam- A. a business owned by the government
ples of the role of entrepreneurship? Se- B. a corporate business
lect TWO answers.
C. a business owned by shareholders
A. Make a profit
D. a business owned by corps
B. Organise resources
C. Adapt existing products 212. A medium business/enterprise would
have
D. Make business decisions
A. 10-49 persons employed.
207. The people who bring all the factors to- B. 250 or more persons employed.
gether to create something are practicing
C. 50-249 persons employed.
A. Land
D. less than 10 persons employed.
B. Labor
C. Capital 213. A merger of corporations involved in dif-
ferent steps of manufacturing or market-
D. Entrepreneurship ing is known as a
208. What freedom did Adam Smith believe A. multinational merger
was essential for an economy? B. horizontal merger
A. The freedom to not wear a mask in a C. vertical merger
pandemic
D. conglomerate
B. The freedom to own land and property
and keep profits 214. The point at which supply and demand
C. The freedom of speech cross.
D. The freedom to practice your religion A. inflation point
B. supply point
209. When demand for a product becomes
greater than available supply, a(n) de- C. market price
velops. D. crosspoint
A. surplus 215. Which factor might cause an increase in
B. shortage the supply of a product?
C. equilibruim A. A decrease in productivity
D. competition B. Fewer sellers in the marketplace
210. What do we call a person who is willing C. A decrease in government regulations
to take the risks of starting a business in D. An increase in the cost of raw materi-
order to make a profit? als
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 274
216. Which of the following is not within the B. 25
scope of Business Economics? C. 27
A. Capital Budgeting. D. 18
B. Risk Analysis. E. 18
C. Business Cycles.
222. The strengthening dollar isn’t going to
D. Accounting Standards last, says portfolio manager
NARAYAN CHANGDER
217. stock of finished goods and parts in re- A. Business news
serve B. Economic news
A. principal C. Microeconomics
B. depreciation D. Macroeconomics
C. labor union
223. In Mixed economy, private sector-
D. inventory
A. Are absolutely free to make any type
218. Disadvantage of a central planned econ- of decisions
omy? B. Works only for social objectives
A. Social justice C. Are regulated directly and / or indi-
B. Limited choice of product and services rectly by government
C. Public goods D. Does not exists at all
D. Profit 224. “The worth of a thing is what it will
219. What do points inside the PPF indicate? bring”-What economic term is this quote
related to in the article?
A. The combination of goods that employ
goods efficiently A. currency
B. The combination of goods that employ B. investment
resources fully C. merchandise
C. The combination of goods that do not D. supply & demand
employ resources fully
225. is the practice of buying at a low price
D. none of above in one location and selling at a higher price
220. Macroeconomics is also called eco- in Another
nomics A. 1. Barter System
A. applied B. 2. Arbitrage
B. aggregate C. 3. Free Trade
C. experimental D. 4. International Trade
D. none of the above Macroeconomics is 226. Price of a product falls by 10% and its
also called economics demand rises by 30%. The elasticity of
221. Given that Qd =30-3p, Qs =9p-18, de- demand is:
termine the equilibrium quantity. A. 1. 1%
A. 20 B. 2.5%
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 275
C. 3. 3 232. “Teach a person to start a fish farm, and
D. 4. 1 he or she will be able to a village for
a lifetime.”
PRACTICE BOOK» NOT FOR SALE
227. Friendship would be considered a(n)
want. A. feed
A. economic B. help
B. limited C. support
C. noneconomic
D. teach
D. unlimited
228. Customers who purchase goods and ser- 233. Which one from the above is not the main
vices for their own use are called cause of unemployment?
Groups A. decrease in Population
A. Individuals
B. Slow Economic Growth
B. Consumer
C. Purchasers C. Fall of Cottage and Small industries:
D. Groups D. slow Growth of Industrialisations
229. Susie is having a hard time deciding
234. Micro economic approach is
whether to purchase a new backpack for
school or a new purse that she can use A. Total
daily. She finally decides to buy the purse.
What is Susie’s opportunity cost? B. Individualistic
A. the money spent on the purse C. Aggregative
B. the backpack D. None of the above
C. nothing, since she got her preferred
choice 235. Utility describes the characteristics of a
D. none of above product that satisfy
230. Market structure characterized by a sin- A. scarcity
gle firm dominating the market. B. needs and wants
A. Oligopoly
C. opportunity costs
B. Purely Competitive
C. Monopoly D. supply and demand
D. Monopolistic competition
236. Advantages include full control, ease of
231. Exploitation and inequality are minimal start up, and no double taxation.
under:
A. Sole Propriotorship
A. Socialism
B. Partnership
B. Mixed economy
C. Capitalism C. Corporation
D. All of the above D. Franchise
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 276
237. A service is 242. business combination involving firms that
A. are the products offered by busi- producethe same kind of product
nesses A. horizontal merger
B. are companies that offer business to B. net income
consumers C. depreciation
C. are physical, tangible items that can D. multinational
be seen and touched
E. vertical merger
NARAYAN CHANGDER
D. the actions that are done by busi-
nesses for consumers 243. A supply chain is
238. A consumer can be defined as A. The transport of goods by sea or some
other means
A. the final user of goods and services
B. The sequence of processes involved in
B. someone who loves to eat
the production and distribution of a prod-
C. someone who makes goods and ser- uct or service
vices
C. The commercial activity of transport-
D. someone who consumes a lot ing goods to customers
239. To get the best from you SWOT analysis D. The amount of a commodity, product,
you must first identify what? or service available and the desire of buy-
A. How much time you have. ers for it
B. The aim. 244. Find the number of units X produces the
C. What your Job role is. minimum average cost per unitC= 1.25x2
+25x +8000
D. How much money you have.
A. 60
240. The term “economies of scale” refers to
B. 70
C. 80
A. the average costs of production de-
creasing as a firm expands D. 90
B. the average costs of production rising 245. Which of the following is not the feature
as a firm expands of capitalist economy:
C. the average costs of production re- A. Right to private property.
maining the same as a firm expands
B. Freedom of economic choice.
D. the average costs of production at first
C. Collective ownership
decreasing, then increasing, as a firm ex-
pands D. Consumer Sovereignty
241. A micro business/enterprise would have 246. a check that transfers a portion of the cor-
porate earnings to a stockholder
A. 10-49 persons employed. A. dividend
B. 250 or more persons employed. B. partnership
C. 50-249 persons employed. C. cash flow
D. less than 10 persons employed. D. net income
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 277
247. The capability of a system to expand its 252. This type of business is owned by two or
total output under an increased volume of more people.
work when resources are added.
PRACTICE BOOK» NOT FOR SALE
A. Sole Trader
A. Autonomy
B. Partnership
B. Big Idea
C. Limited Company
C. Profitability
D. Franchise
D. Scalability
253. (A) There is similarity between Robbins’s
248. organization of workers formed to repre- definition and Samuelson’s definition(B)
sent its members’ interests in various em- Samuelson’s definition is not only dynamic
ployment matters in content; it is also wider in scope.Of
these
A. principal
A. A is true, but B is false
B. labor union
B. A is false, but B is true
C. multinational
C. Both A and B are true
D. corporation
D. Both A and B are false
249. In Business economics ‘Means’ refers to
254. The most prominent members of the Neo-
classical school of economics is
A. Human wants
A. Adam Smith
B. Resources
B. Milton Friedman
C. Both (1) and (2)
C. Lucas
D. Neither (1) nor (2)
D. Alfred Marshall
250. What is the role of the entrepreneur in
the modern economy? 255. What are Needs?
A. To preserve natural resources A. These are goods and services which
human beings desire but can live without.
B. To create jobs
B. All the above.
C. To generate wealth
C. These are goods and services which
D. to take big risks
human beings cannot live without.
251. This type of partnership is less risky be- D. none of above
cause this partner is only responsible for
the contribution he/she has made to the 256. is a condition in which the average
partnership level of prices is actually falling.
A. Sole proprietorship A. Disinflation
B. General Partnership B. Deflation
C. Corporation C. Stagflation
D. Limited partnership D. Uniflation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 278
257. Which of the following is best described 261. The heart of economics is
as what you are willing to give up to have A. wants.
your first choice?
B. resources.
A. Trade-off
C. trade-offs.
B. Scarcity
D. decision-making.
C. Economic Decision-Making
262. Which of the following business organi-
D. Opportunity Cost zations is likely to experience disagree-
NARAYAN CHANGDER
ments between management and share-
258. Economists regard decision making as im- holders? A.Co-operative societies B.Sole
portant because: traderC.Partnerships D.Joint-stock com-
A. The resources required to satisfy our pany
unlimited wants and needs are finite, or A. A
scarce.
B. B
B. It is critical to understand how we can
C. C
best allocate our scarce resources to sat-
isfy society’s unlimited wants and needs D. D
C. Resources have alternative uses E. D
D. All of the above 263. The economists who presented the
growth oriented definition of economics
259. Which statement is NOT TRUE for con- A. Adam Smith
sumer sovereignty?
B. Samuelson
A. Consumer has the power to decide
what goods to be produced C. Marshall
D. Karl Marx
B. Consumers send signals to producers
through their demand 264. Which is NOT a feature of Utility
C. Business decides what they want to A. Subjective
produce B. Measurable
D. Producers produce g/s they think has C. Relative
highest demand
D. No moral or legal connotations
260. An example of ‘positive’ economic analy-
265. The economic problems of relative
sis would be
scarcity refers to
A. an analysis of the relationship be- A. consumers purchasing goods and ser-
tween the price of food and the quantity vices from businesses
purchased
B. consumers not being able to afford dif-
B. determining how much income each ferent goods and services
person should be guaranteed
C. consumers making purchasing deci-
C. determining the ‘fair’ price for food sions in relation to their needs and wants
D. deciding how to distribute the output D. consumers making purchasing deci-
of the economy sions in relations to goods and services
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 279
266. The cottage industry system involved 272. In which economic system is trade and
manufacturing- barter most common?
PRACTICE BOOK» NOT FOR SALE
A. of hand made luxury goods A. Mixed
B. in the home B. Command
C. steam engines and other cottage-
C. Market
sized macines
D. Traditional
D. cheese and pastries
267. What is “spam”? 273. Something we would like to have but can
survive without
A. a form of hacking
B. a form of firewall A. Want
C. intellectual property B. Need
D. junk e-mail C. Producer good
268. Whose ideas led to Socialism? D. Public good
A. Adam Smith 274. What is an import quota?
B. Karl Marx
A. The number of imports in Australia
C. Vladimir Putin
B. the number of taxes placed on a prod-
D. none of above uct
269. Which economic activity would i such C. A restriction of the amount of imports
as thinking, research and developing new
ideas fall under? D. A restriction on the amount of exports
A. Primary 275. what is a planned economy?
B. Secondary A. an economy directed to basic subsis-
C. Tertiary tence rather then to the market
D. Quaternary B. an economic system in which pri-
vate individuals or businesses own capital
270. A FULL LARGE MARKET
goods
A. MONOPOLY
C. type of economic system where invest-
B. OLIGOPOLY ment, production and the allocation of cap-
C. MONEY ital goods take place
D. PERFECT D. none of above
271. Gives the owner the legal right to make
276. Who is the queen of the Social sciences
or sell an invention?
A. Adam Smith
A. Copyright
B. Trademark B. Alfred Marshall
C. Patent C. No of the above
D. Design patent D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 280
277. Which of the following is considered as a 282. Activities provided for the satisfaction of
disadvantage of allocating resources using others that are consumed the time they are
the market system? produced.
A. Income will tend to be unevenly dis- A. Services
tributed. B. Mixed Economy
B. People do not get goods of their C. Wants
choice.
D. Trade-off
NARAYAN CHANGDER
C. Men of Initiative and enterprise are
not rewarded. 283. What does the Circular Flow show?
D. Profits will tend to be low. A. Consumers and Producers
B. Business and Households
278. What is Scarcity?
C. Goods & services
A. Needs and Wants
D. How consumers and producers are in-
B. Unlimited Needs and Wants terdependent
C. When something is in short supply
284. Which of the following does NOT illus-
D. When something is rare and expensive trate opportunity cost?
279. Total utility maximum when: A. I should buy a book rather than a food
A. Marginal utility is maximum B. If I buy a computer, I must do without
a 35” television
B. Marginal utility is Zero
C. If I spend a lot now means I will spend
C. Average utility is maximum more in the future
D. Average utility is Zero D. If I study today, I must give up going
to the football game
280. “Economics is the Science which stud-
ies human behaviour as a relationship 285. Consider the following and decide, which
between ends and scarce means which economy (if any) is without scarcity
have alternative uses”-These lines are at- A. American economy
tributed to
B. Chinese Economy
A. Samuelson
C. Post independence Indian economy
B. Lionel Robbins
D. None of the above
C. Robertson
286. Which of the following is not a positive
D. Marshall
economic statement?
281. What is the relationship between quan- A. Unemployment rate decreases with in-
tity supplied and price? dustrialization
A. a. They are not related. B. Economics is a social science that stud-
ies human behaviour.
B. a. They are directly related.
C. Looking at the current condition of
C. They are inversely related
farmers, the government is expected to
D. They are related through demand. decrease the rate of interest on loan.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 281
D. India spends a huge amount of money B. 2.perfect complements
on national defense. C. 3.perfect elastic
PRACTICE BOOK» NOT FOR SALE
287. Which of these is a service? D. 4.none of the above
A. School fees 293. Which of the following is concerned with
B. Toothbrush micro economics
C. Clothes A. The size of national output
D. Chocolate B. The level of employment
288. A curve that shows relation ship between C. Change in the general level of prices
quantity of goods that consumer are will- D. None of the above
ing to buy and the price of the good.
294. What business is a combination of the tra-
A. 1.supply curve
ditional business firms and the internet?
B. 2.demand curve These businesses not only specialize in tra-
C. 3.elesticities of supply ditional methods of distribution, but also
ways using different technology.
D. 4. none of the above
A. Hybrid Business
289. A study of how increases in the corporate
B. Merchandising Business
income tax rate will affect the national un-
employment rate is an example of C. Limited Liability Company
A. Macro-Economics. D. Corporation
B. Descriptive Economics 295. Which of the following is most likely an
C. Micro-economics example of a monopoly?
D. Normative economics A. A Starbucks across from Dunkin
Donuts
290. business owned and run by one person
B. A gas station in a town by itself
A. consumer cooperative
C. 3 fast food restaurants all on the same
B. partnership street
C. sole proprietorship D. A Sainsbury’s 4 miles away from a
D. corporation Tesco’s
291. Business owned and run by 1 person 296. Who expressed the view that economics
is neutral between ends?
A. partnership
A. Adam Smith
B. nonprofit organization
B. Marshall
C. sole proprietorship
D. corporation C. Samuelson
D. Robbins
292. two goods for which the marginal rate of
substituion of one of the other is constant 297. A is a business that is jointly owned
are called by two or more persons.
A. 1.perfect substitutes A. Proprietorship
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 282
B. Partnership 303. Match List I and II and choose the correct
C. Corporation answer using the codes given below List
I (Economist) List II (Definition) A. Adam
D. Franchise Smith 1. Welfare B. Marshall 2. Wealth
298. a combination of two or more businesses C. Robbins 3. Growth D. Samuelson 4.
to form a single firm Scarcity
A. merger A. A-2, B-1, C-4, D-3
B. net income
NARAYAN CHANGDER
B. A-2, B-3, C-1, D-4
C. depreciation
C. A-1, B-2, C-3, D-4
D. multinational
D. A-4, B-3, C-2, D-1
E. vertical merger
299. Micro and macro are not two independent 304. The Dow Jones industrial average swept
approaches to economic analysis but they past 12, 000 for the first time. Investors
are substitute to each other. are increasingly optimistic about corporate
A. True earnings and the economy. This achieve-
ment MOST likely involved which type of
B. False business organization?
C. PARTLY TRUE
A. proprietorship
D. PARTLY FALSE
B. partnership
300. All of the following are basic economic
questions except C. corporation
A. What to produce? D. conglomerate
B. When to produce?
305. Tony Galati, owner of the Spud Shed,
C. How to produce?
showed initiative and innovation by
D. For whom to produce it for?
A. creating a business that sourced prod-
301. What effect does rising interest rates ucts straight from local farmers
have on consumer spending?
B. creating a business that stored prod-
A. Increases spending ucts in warehouses
B. Decreases spending
C. creating a business that made him a
C. Neither increases or decreases spend- profit
ing
D. creating a business that destroyed the
D. Both increases and decreases spend-
competitors
ing
302. The driving force in choosing to start a 306. what is a scam?
business is
A. a criminal
A. supply and demand
B. fake scheme to steal money or goods
B. market forces
C. competition C. making profit
D. profit D. legally allowed due to law
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 283
307. Supply represents 312. is the term for all activities involved
A. how much of a product or service the in developing and exchanging products.
PRACTICE BOOK» NOT FOR SALE
market has to offer A. Business
B. how much of a product that the cus- B. Entrepreneurship
tomer wants to buy
C. Economics
C. how many goods are available for pur-
D. Corporation
chase
D. how much of a product or service that 313. Which are important for their ability to
buyers want to sell move resources, products, and financial
capital across national boundaries with rel-
308. “Economics is what economists do” was ative ease?
remarked by
A. corporations
A. Marshall
B. conglomerates
B. Jacob Viner
C. mergers
C. Keynes
D. Adam Smith D. multinationals
309. Persons or company who supplies goods 314. The law of Scarcity-
and services. A. Does not apply to developed and rich
A. Consumer countries
B. Creditors B. Applies only to less developed coun-
tries
C. Government
D. Suppliers C. Implies that the consumers’ want will
be satisfied in a socialist economy
310. Which one of the following is an advan- D. Implies that consumers’ want will
tage for an entrepreneur for starting a never be completely satisfied.
business as a sole trader?
A. Limited liability means that losses can 315. How is a limited company different from
be minimised a sole trader or partnership?
B. Owner has control of decision making A. A limited company has only one or two
owners.
C. It is easier to raise finance than other
types of business structure B. A limited company is usually owned by
D. Less risky than other types of business one person.
structure C. A limited company only operates on-
line.
311. Give THREE reasons for the growth in in-
ternational tourism D. The owners (share holders) have lim-
ited liability.
A. Increase in disposable income
B. Equal 316. This is an assumption of law of demand
C. Cheaper flights A. 1.Price of the commodity should not
D. Improvement in the tourism infrastruc- change
ture B. 2.Quantity should not change
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 284
C. 3.Supply should not change 322. When two goods are perfect complemen-
D. 4.Income of consumer should not tary, the indifference curve is:
change A. A straight line
317. Which of the following business practice B. U shaped
REDUCES consumer sovereignty? C. L-shaped
A. Marketing D. Circular in shape.
B. Misleading conduct
NARAYAN CHANGDER
323. Things required in-order to live.
C. Planned Obsolescence
A. Market Price
D. All of the above
B. Producers
318. organization that promotes the collective
interests of its members rather than seek- C. Needs
ing financial gain for its owners D. Trade-off
A. limited life
324. Which is not a study under micro eco-
B. nonprofit organization nomics?
C. proprietorship A. Consumer
D. partnership
B. producer
319. In the circular flow model, the real flow C. Firm
(not money) from households to producers
is: D. General Employment
A. Wages and salaries 325. Match list I and list II and choose the
B. Goods and services correct answer using the codes given be-
lowList I (Economist) List II (Book)A. Adam
C. Factors of production Smith 1. EconomicsB. Marshall 2. Wealth
D. Consumption expenditure of nationsC. Robbins 3. Nature and Signif-
icance of Economic ScienceD. Samuelson 4.
320. An Economy in which resources are Principles of Economics
owned and controlled by the Government.
A. A-2, B-1, C-4, D-3
A. Economic System
B. A-2, B-4, C-3, D-1
B. Command Economy
C. A-1, B-2, C-3, D-4
C. Market Economy
D. A-4, B-3, C-2, D-1
D. Market Price
321. A term for all the activities involved inn 326. A person in which of the following fields
developing and exchanging products. would most likely use economics?
A. Service A. business
B. Business B. medical
C. Profit C. education
D. Market D. construction
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 285
327. is the tendency in a free market for C. Traditional
the price to change until market clears. D. Mixed
PRACTICE BOOK» NOT FOR SALE
A. 1.shortage
333. External economies of scale are cost sav-
B. 2.market mechanism ings available to the whole as a result
C. 3.surplus of its
D. 4.none of the above A. Industry, Location
B. Business, Location
328. amount borrowed when getting a loan or
issuing a bond C. Industry, Size
A. inventory D. Business, Size
B. depreciation 334. The definition of Scarcity is
C. principal A. An unlimited amount of resources to
meet limited wants and needs
D. unlimited liability
B. A limited amount of resources to meet
329. The World’s richest entrepreneur is: unlimited wants and needs.
A. Bill Gates-Microsoft C. When people use time and energy to
B. Gina Rhinehardt-Rio Tinto create events
C. Jeff Bezos-Amazon D. a city where individuals commit them-
selves to unlimited wants and needs
D. Queen Elizabeth II
335. Which of the following may be an exam-
330. A curve that shows relationship between ple of a need?
quantity of good that producers are willing
A. A Ferrari
to sell and the price of the good is called
B. Medication
A. 1.supply curve
C. Netflix
B. 2.demand curve
D. An iPhone
C. 3.elesticities of supply
336. Economy that is based on supply and de-
D. 4.none of the above
mand where individual companies and con-
331. A graph containing a set of indefference sumers make the decisions about what,
curves showing the market basket among how and for whom items will be produced.
which a consumer is indefferent is called A. command economy
A. 1.indeffrence map B. market economy
B. 2.indefference curve C. mixed economy
C. 3. both 1 & 2 D. none of above
D. 4.none of the above 337. Tourism, hospitals and banking are all ex-
amples of which industry?
332. A economy is one in which economic
decisions are based on a values, culture, A. tertiary
and customs. B. primary
A. Command C. secondary
B. Market D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 286
338. Which of the following is a variable cost 343. Business income is considered personal in-
for a business? come
A. manager salary A. Partnership
B. wages B. Corporation
C. electric bill for security lights C. Sole Proprietorship
D. Partnership and Sole Proprietorship
D. payment for a license to operate
NARAYAN CHANGDER
344. State the correct answer:The law of
339. business that is jointly owned by two or scarcity:
more persons
A. does not apply to rich, developed coun-
A. stock tries.
B. partnership B. applies only to the less developed
C. depreciation countries.
C. implies that consumers wants will be
D. dividend
satisfied in a socialistic system.
340. Why are firms in markets that have per- D. implies that consumers wants will
fect competition described as “price tak- never be completely satisfied.
ers”?
345. Which of the following does not improve
A. Due to competition you can’t charge the quality / productivity of land?
whatever you want
A. Migration
B. Due to barriers to entry prices need to
B. Drainage
be high
C. Genetically-modified crops
C. Due to lack of competition you can
charge whatever you want D. Reclamation
D. Due to few businesses providing a 346. Economics has been called a ‘Science of
product, prices change dramatically Choice ‘ because
A. The human wants are unlimited, so
341. A budget constraints line is a result of:
choice making is essential
A. Market price of commodity X B. Economics is a Social science
B. Market price of commodity Y C. Economics is a Study of material wel-
C. Income of the consumer fare
D. All of these D. Economics is a Study of man and
choice
342. The distinction between variable cost and
347. What is resource development?
fixed cost is relevant only in
A. A government agency.
A. long period
B. My least favorite subject.
B. short period
C. The study of how to increase re-
C. medium term sources.
D. mixed period D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 287
348. “Real” GDP more accurately measures C. Sole Proprietorship
changes in production than Nominal GDP D. Limited Partnership
because it accounts for
PRACTICE BOOK» NOT FOR SALE
A. changes in price 354. What is the term that describes when
the amount of goods produced is about the
B. phases of the business cycle same as the number of consumers who are
C. increases in unemployment willing to buy the product?
D. decreases in exports A. risk
349. Perfect competition is characterized by B. supply
A. large number of buyers and sellers C. demand
B. homogeneous product D. equilibrium point/market point
C. free entry and exit of firms 355. ind the price per unit P that produces
D. all the above the maximum profitC= 100+30 x Demand
function P=90-x
350. Initiative and Innovation help businesses
A. 60 $
gain the competitive advantage by
B. 60$
A. finding a market where you can sell
things C. 80$
B. finding a niche D. 90$
C. finding a niche in the market and gain- 356. Which of the following groups of words
ing more consumer support best describes wants:
D. finding more consumers A. Limited, changing, and compensating
351. The third step in the decision making pro- B. Limited, unchanging, and competing
cess is C. Unlimited, unchanging, and compen-
A. define the problem sating
B. evaluate the alternatives D. Unlimited, changing, and competing
C. identify the alternatives 357. Individuals who will buy the products and
D. make a choice services in the market.
A. consumers
352. Which of the following is NOT a function
of business? B. creditors
A. Capitalism C. government
B. Marketing D. suppliers
C. Finance 358. A gap between unlimited wants and lim-
D. Production ited resources creates
353. What is a company called that sells stock A. scarcity.
to raise money? B. economics.
A. Partnership C. wants.
B. Corporation D. resources.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 288
359. One way to measure economic growth is 364. In Business economics ‘ends’ refers to-
to A. Human wants
A. count the number of businesses in a B. Resources
country
C. Both (1) and (2)
B. compare GDP
D. Neither (1) nor (2)
C. measure the number of imported
goods coming into a country 365. ownership certificates in a firm
NARAYAN CHANGDER
D. compare interest rates A. collective barganing
B. charter
360. Printed and online promotion is needed in
starting your business. C. stock
D. dividend
A. advertisement
B. big ideas 366. The most recognizable form of non-price
competition is?
C. sustainability
A. More Locations
D. growth
B. Better Customer Service
361. The main economic problem faced by all C. Advertising
society is
D. Low Price
A. unemployment
367. analyses cause and effect relation-
B. Inequality ship but does not pass any value judgment.
C. Poverty A. Positive or pure science
D. Scarcity B. Normative science
362. Advantages of this type of business in- C. None of the above
clude:easy to start, and you can rely on D. All of above
a good company name and expertise with
help to set up and run the business. 368. Nike, Google and Apple are examples of
A. Sole Trader
A. Sole Proprietorships
B. Partnership
B. Partnerships
C. Limited Company
C. Corporations
D. Franchise
D. Franchises
363. What is a major reason for conglomerate 369. An action or task that is performed, usu-
mergers? ally for a fee.
A. diversification A. Service
B. multinationals B. Profit
C. unlimited life C. Customer
D. conglomeration D. Economics
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 289
370. What can a Government do to increase D. Micro economics is often called in-
standards of living? come theory to emphasize the important
role that prices play
PRACTICE BOOK» NOT FOR SALE
A. Increase the cost of living
B. Reduce spending on services 375. This economy of scale is where advertis-
ing budgets can be spread across multiple
C. Nothing
products for lower average costs.
D. Boost economic growth A. Managerial
371. The law of says that the price of a B. Marketing
product is determined by the relationship C. Financial
of the supply of a product and the demand
D. Purchasing
for the product.
A. Supply and demand 376. What usually happens to inflation during
a recession?
B. Physics
A. it stays the same
C. Consumer behavior
B. it decreases
D. Business
C. it increases
372. indefference curves are normally D. it is zero
A. 1.downward sloping and can not inter- 377. What is a car an example of?
sect
A. A Cost
B. 2.upward sloping
B. A serviceA Service
C. 3.indeffrent
C. A Product/Good
D. 4.none of the above
D. none of above
373. Disadvantages of this business type in- 378. An oligopoly is a market that is charac-
clude:needs a partnership agreement, part- terized by:
ners might not get along, owners share
profits, unlimited liability. A. one firm that totally dominates the sup-
ply of the product.
A. Sole Trader
B. a large number of small firms all pro-
B. Partnership ducing very similar products.
C. Limited Company C. a few large sellers who dominate the
D. Franchise market.
D. several small firms that compete pri-
374. Which one of the following is not true? marily by differentiating their products.
A. Micro economics is the study of the al-
379. It is an assessment of how easy it is for
location of scarce resources
the buyers to drive prices down.
B. Economists use models to make
A. Power of Wholesaler
testable predictions
B. Power of Retailer
C. Individuals, governments, and firms
use micro economic models and predic- C. Power of Seller
tions in decision making D. Power of Consumer
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 290
380. Which one of the following is not an ad- B. The environment in general
vantage of being a sole trader?
C. Specifically lumber and water
A. Easy to set up and run
D. Capital only
B. All the profits go to the owner
C. Cannot be continued when the owner 386. Decreased government spending may re-
dies sult in taxes.
D. The owner has full control of the busi- A. higher
NARAYAN CHANGDER
ness B. more
381. Which of the following is not an advan- C. lower
tage of a command economy? D. none of above
A. Can ensure stability.
387. What is any word, name, or symbol used
B. Serves people collectively by focusing
to identify a company?
on equality.
C. Products produced fulfill needs. A. Copyright
D. Lack of incentive for innovation. B. Trademark
C. Utility Patent
382. Individuals and organizations that deter-
mine what products and services will be D. Design patent
available for sale.
388. Things available to be used to produce
A. Consumer goods and services.
B. Economic Decision Making
A. Capitalism
C. Producers
B. Economic Resources
D. Wants
C. Mixed Economy
383. The most attractive alternative given up D. Demand
when a choice is made, is the
A. scarcity choice 389. This type of business organization makes
it easier to secure financing because more
B. favorite choice
than one person may apply for credit.
C. economics cost
A. Sole proprietorship
D. opportunity cost
B. Partnership
384. Micro economics is a equilibrium
C. Corporation
A. Partial
D. Franchise
B. General
C. Total 390. What is a tariff?
D. Multi-Variable A. GST
B. A tax on exported goods
385. In economics, resources are:
C. A tax on imported goods
A. Anything used to create something
else D. A tax on the final good
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 291
391. The theory Stock Company can be a pri- B. PESTEL analysis
vate company whose minimum member- C. Industry analysis
ship isA. 2B. 5C. 7D. 10
PRACTICE BOOK» NOT FOR SALE
D. Business analysis
A. A
B. B 396. “the world is constantly changing” what
C. C does this mean?
D. D A. more and more jobs are being avail-
able or fulfilled or are becoming distant
E. A from society
392. Which of the following is the best reason B. there are no more jobs available and
for studying economics: they are all taken and done
A. To determine which occupations inter- C. there are heaps of options in society
est you for everyone
B. To find the best use for resources and D. everyone has to work as the same job
supplies all day everyday
C. To prepare for effective decision-
making and responsible citizenship 397. Milling lumber into plywood is an exam-
ple of what economic activity?
D. To learn how to invest money and ex-
press social responsibility A. Primary
393. Who is the current CEO of the Niti B. Secondary
Aayog? C. Tertiary
A. Rajeev Kumar D. Quaternary
B. Arvind Subramanyam
398. Mario owns his own frozen yogurt shop
C. Amitabh Kant but he is required by law to pay his work-
D. Narendra Modi ers a minimum wage and he must provide
health insurance to his full-time employ-
394. what three questions must all economic ees. What type of economic system does
systems answer? Mario live in?
A. when will it happen? will it happen? A. Market System
why will it happen?
B. Mixed System
B. -what goods and services will be pro-
duced? -how will the goods and services C. Traditional System
be produced? -who will receive the goods D. Command System
and services produced?
C. who will do it? how will it happen? 399. Who was nominated to the full time mem-
does it actually happen? bership of Niti Aayog?
D. none of above A. Varun Agrawal
B. Ramesh Chand
395. This is the other term for environmental
analysis. C. Raghuram Rajan
A. SWOT analysis D. None of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 292
400. The financial sector can be described as C. Business exploiting cheap labour in de-
veloping countries
A. banks that use the deposits collected D. Firm exploiting poor environmental
in order to help businesses grow laws in developing country
B. financial intermediaries that collect de-
405. The point where supply and demand are
posits and invest in the growth of busi-
equal.
nesses
A. Market Price
NARAYAN CHANGDER
C. financial intermediaries that allow con-
sumers to open savings accounts B. Trade-off
D. banks that charge interest on loans C. Services
that are offered to consumers D. Scarcity
401. good whose demand curve slopes up-
406. Which type of economy has the govern-
wards because the income effect is larger
ment making all decisions?
than the substituition effect is called
A. Market
A. 1.giffen good
B. Mixed
B. 2.complementary goods
C. Traditional
C. 3.precious goods
D. 4.none of the above D. Command
402. What type of policy is the use of interest 407. Factors that make it difficult for new
rates to control the economy? firms to enter a market are called
A. demand side policy A. Barriers to entry
B. fiscal policy B. Factors of production
C. insurance policy C. Limited supply
D. monetary policy D. Monopolistic Outlook
403. A disadvantage of a sole proprietorship 408. Ownership and management are sepa-
is rate
A. Difficulty starting the business A. Sole Proprietorship
B. unlimited liability B. Partnership
C. That the owner must share profits with C. Partnership and Corporation
others D. Corporation
D. double taxation of earnings
409. Brazil’s food inflation:don’t blame it all
404. Which is NOT an example of UNETHICAL on the weather
decision making by firms?
A. Business news
A. Volkswagen cheated fuel emission
B. Economic news
tests, mislead consumers
B. Qantas give passengers option to pay C. Microeconomics
for the CO2 emissions D. Macroeconomics
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 293
410. Which government tax provides free 415. Of the four factors of production, which
healthcare to Australians? of these are not a factor of production?
PRACTICE BOOK» NOT FOR SALE
A. Health tax A. Land
B. Medibank B. Capital
C. HBF C. Development
D. Medicare D. Labour
411. GDP, or gross domestic product, mea- 416. Which of the following is NOT an advan-
sures tage of starting a business as a partner-
A. the value of all final goods and services ship?
produced A. More finance can be raised
B. an increase in the general price level B. Partners can specialise according to
C. the percentage of people looking for their experience
work that can’t find it C. The workload is reduced since it is
D. the economic freedom an economy of- shared amongst partners
fers D. Partners may disagree and fall out
with each other
412. Which type of economy lets the govern-
ment & private businesses work together 417. Anywhere a business exchange takes
in order to make decisions? place.
A. Market A. economics
B. Mixed B. product
C. Command C. market
D. Traditional D. service
413. When comparing the four main types 418. what are the factors of production?
of business organizations, which protects A. wants, needs, happiness
owners the MOST from personal financial
liability due to being sued by a customer? B. resources people use to produce
goods and services
A. Sole Proprietorship
C. the factors that go into proudction
B. Partnership
D. the way shops are run in order to be
C. Franchise successful
D. Corporation
419. Commercial enterprise that dedicates it-
414. Disadvantages include double taxation self to buying already made products and
and more government regulation reselling them to make profit?
A. Sole Propriotorship A. Merchandising Business
B. Partnership B. Limited Liability Company
C. Corporation C. Partnership
D. Franchise D. Service Business
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 294
420. Defined Business Economics in refer- B. Economic System
ence with preparation of policies? C. Consumer
A. J.B Say D. Wants
B. Alfred Marshall
426. Which is not a likely disadvantage of a
C. Walker small firm?
D. Joel Dean A. Higher costs
B. Difficulty attracting quality staff
NARAYAN CHANGDER
421. Deliberate deception, designed to secure
unfair or unlawful gain. C. Vulnerability to competition (especially
A. Cease and desist order from larger companies)
B. Limited warranty D. Lower overall wage costs
C. Fraud 427. Which of the following is not a factor of
production:
D. none of above
A. Land
422. . Science of Material Welfare is also
B. Income
known as
C. Labour
A. Classical Definition
D. Capital
B. Neo-classical Definition
C. None of the above 428. An Economy in which the resources are
owned and controlled by the people of the
D. none of above country.
423. The core problem of economic study is? A. Producers
A. Money B. Mixed Economy
B. Scarcity C. Market Economy
C. Allocation D. Supply
D. Production 429. A Limited liability company
424. Which of the following is the best exam- A. combines the best features of a part-
ple of a business’s economic decision? nership and corporation
A. hiring part-time employees to save on B. is a business coming together for a lim-
costs ited time
B. Endorsing an independent candidate in C. is a company where owners have un-
state elections limited liability
D. none of above
C. updating directions to your office on
the company website 430. In a free market economy the allocation
D. Following up with a customer after she of resources is determined by
exchanged an item A. voting done by consumers
425. Things that add comfort and pleasure to B. a central planning authority.
your life. C. the level of profits of firms.
A. Services D. consumer preferences.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 295
431. What do we do when we invest? 437. The four influences on the way people
A. We save something. work are:
PRACTICE BOOK» NOT FOR SALE
A. Technology, communications, out-
B. We borrow something.
sourced labour and casualisation
C. We spend something.
B. Automation, casualisation, scarcity
D. none of above and outsourced labour
432. What is the fundamental problem of ev- C. scarcity, demand, technology and re-
ery society? dundancy
A. labor costs D. none of above
B. scarcity 438. Adam smith book “An Enquiry Into the
Nature and Causes of Wealth of Nations”
C. economic interdependence
was published in
D. market fluctuation
A. 1576
433. Which of the following is the most com- B. 1874
mon form of business organization? C. 1776
A. corporation D. 1930
B. sole proprietorship
439. The circular flow model of a market econ-
C. franchise omy shows
D. partnership A. how many firms can support the needs
of how many households
434. When the TU is maximum then MU is?
B. the interactions between households
A. Zero and firms in the free market
B. Negative C. what inputs are required for what out-
C. Both puts
D. None. D. how profits are made
435. list TWO arguments in favour of free 440. is the description of how consumers
trade. allocate income among different goods and
services to maximise their well being.
A. employment, tax
A. 1.theory of consumer behavior
B. economy, subsidies
B. 2.consumer preferences
C. cycle, monopoly
C. 3.consumer choices
D. choice, innovation D. 4.none of the above
436. Minority, women, and technology rates 441. What factor of production is an en-
in the workforce is trepreneur?
A. increasing A. Capital
B. decreasing B. Enterprise
C. staying the same C. Labour
D. Go patriots D. Land
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 296
442. requirement that an owner is personally 448. Micro economics theory studies how a
and fully responsible for all losses and free enterprise economy determines:
debts of the business A. The price of goods
A. limited liability B. The price of services
B. unlimited liability C. The price of economy resources
C. principal
D. All of the above
D. depreciation
NARAYAN CHANGDER
449. Workers
443. In which economic system is profit incen-
A. Land
tive to innovate?
B. Labor
A. Mixed
C. Capital
B. Market
C. Command D. Entrepreneurship
D. Traditional 450. Relationship between the amount of a re-
source that is available and the price.
444. What kind of business specializes in per-
forming services for the consumers? A. demand
A. Corporation B. supply
B. Service Business C. market
C. Hybrid Business D. inflation
D. Partnership 451. A Limited liability partnership:
445. When demand is perfectly inelastic, an in- A. Have silent partners who cannot lose
crease in price will result in: more than they invested
A. 1.A decrease in total revenue B. Have a board of directors
B. 2.An increase in total revenue C. Have just two owners
C. 3.No change in total revenue D. Have stock
D. 4.A decrease in quantity demanded 452. Monopolies are good because
446. Basic economic problems exist because of A. prices are higher
A. needs. B. options are reduced, making decisions
B. capital resources. easier
C. scarcity. C. forces other firms to quit
D. economic resources. D. they are regulated by the government
447. Veterinary Practices are often owned by 453. The government plans how to use re-
two or more Vets. This is known as a sources to make goods and services.
A. Sole Trader A. Mixed Economy
B. Partnership B. Command Economy
C. Limited Company C. Market Economy
D. Franchise D. Traditional Economy
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 297
454. Find the number of units X that produce D. How businesses maximize profits
maximum revenueR=800x-0.2x2
460. Economic growth would most likely result
PRACTICE BOOK» NOT FOR SALE
A. 2ooo unit
from-
B. 200 unit
A. decreased trade
C. 3000 unit
B. increased productivity
D. 300 unit
C. increased employment
455. Fiscal policy involves increases or de-
creases in: D. decreased sales of stock
A. the money supply 461. Advantages of this type of business in-
B. interest rates clude:selling stock to raise money, limited
C. government spending and taxes. liability.
D. exports and imports A. Sole Proprietorship
456. What happens when supply is bigger B. Partnership
than demand? C. Corporation
A. Surplus D. Franchise
B. Shortage
462. Who expressed the view that “Eco-
C. Inflation
nomics is neutral between end”?
D. Equlibrium
A. Robbins
457. Sara’s Hair Palace is a small, locally
B. Marshall
owned beauty salon in Sterling. This rep-
resents what type of business? C. Pigou
A. corporation D. Adam smith
B. partnership
463. An expansionary period in the business
C. sole proprietorship cycle is distinguished by-
D. none of above
A. high inflation
458. The wish to have something is B. declining sales
A. Desire C. fewer excise taxes
B. Want
D. low unemployment
C. Need
D. Demand 464. What are goods?
459. The best definition of economics A. Actions, skills or knowledge provided
by someone
A. Hows choices are made under condi-
tions of scarcity B. Tangible items used by consumers to
satisfy their needs and wants
B. How money is used
C. Items we need in order to survive
C. Hows goods are services are pro-
duced D. Companies who create services
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 298
465. funds left over after all of the firm’s B. Profit
expenses, including taxes, are subtracted C. Capitalism
from its sales
D. Service
A. proprietorship
B. cash flow 471. “Economics is the study of mankind in the
ordinary business of life”. This definition
C. partnership
was given by
D. net income
A. Adam Smith
NARAYAN CHANGDER
466. The following are causes of shift in de- B. Lionel Robbins
mand EXCEPT the one:
C. Alfred Marshall
A. 1.change in income
D. Samuelson
B. 2.change in price
C. 3.change in fashion 472. The slope of indifference curve is equal to
D. 4. change in prices of substitutes A. price ratio
B. marginal opportunity cost
467. This acts like a fire or a driving force that
make every business successful. C. marginal rate of substitution
A. principles D. all of these
B. tools 473. Who appoints the Vice Chairman of Niti
C. techniques Aayog?
D. strategies A. Prime Minister
468. A science that examines how goods and B. President of India
services are produced, sold, and used is C. Chief Justice of the supreme court
called
D. None of the above
A. Economics
B. Social Studies 474. The central question in economics is how
to:
C. Biology
A. deal with the problem of scarcity.
D. Chemistry
B. change government economic policy.
469. MPS is equal to
C. change people’s wants to match their
A. Consumption / Income needs.
B. Saving / Income D. manage money and become wealthy.
C. Change in Consumption / Change in In-
come 475. If a business conducts a SWOT analysis to
decide whether or not to expand, which of
D. Change in Saving / Change in Income the following would be categorized as an
“O”?
470. Money that a business has left over after
all the expenses and costs of running the A. money is available for the expansion
business are paid. B. there is a potential for increased prof-
A. Economics its
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 299
C. new competition could enter the mar- C. market
ket D. inflation
PRACTICE BOOK» NOT FOR SALE
D. company expenses have increased
481. Markets like automobiles, cell phones,
476. “Economics is the oldest of the arts, film production studios, and internet
newest of the sciences, indeed the Queen providers are examples of which market
WsociaJ sciences”. This is remarked by structure?
A. Haberler A. Monopoly
B. Hicks B. Oligopoly
C. Jacob Viner C. Perfect competition
D. Samuelson D. Monopolistic competition
477. corporation that has manufacturing or
482. The market price for a product is deter-
service operations in a number of countries
mined at a point where
A. consumer cooperative
A. Demand exceeds supply
B. interest
B. supply exceeds demand
C. sole proprietorship
C. supply equals demand
D. multinational
D. there is both a shortage and surplus
478. change in consumption of a good result-
ing from increase in purchasing power with 483. Which brand of drinks may be a very
relative price held constant good substitute for Coca-Cola?
A. 1.substitution effect A. Mirinda
B. 2.income effect B. Pepsi
C. 3.both 1 & 2 C. RC
D. 4.none of the above D. 7 Up
479. business combination of firms involved in 484. A business that creates its own plan to
differentsteps of manufacturing or market- expand its economic growth.
ing
A. Autonomy
A. horizontal merger
B. Big Idea
B. net income
C. Profitability
C. depreciation
D. Scalability
D. multinational
E. vertical merger 485. If quantity demanded is completely unre-
sponsive to changes in price, demand is:
480. A buyer’s willingness and ability to pay
A. 1.Inelastic
a price for a specific quantity of a good or
service. B. 2.Unit elastic
A. demand C. 3.Elastic
B. supply D. 4.Perfectly inelastic
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 300
486. Which factor does not affect the demand 491. The difference between the income
for labour? earned and the expenses incurred by a
A. Demand for a product business during a specific period of time
is called
B. Productivity of labour
A. Sales
C. Migration
B. Profit
D. Availability of substitutes
C. Expenses
NARAYAN CHANGDER
487. What is inflation? D. Costs
A. When the economy is doing well. 492. The economy is the total of all activities
B. A sustained increase in the general for the purpose of
price level of goods and services in an A. producing, marketing and selling
economy over a period of time. goods and services in a country
C. When Coles and Woolworths increase B. creating, designing and exploring
the price of some goods. goods and services in a country
D. When you get a high power bill. C. producing, distributing and consuming
goods and services in a country
488. Which of the following is a characteristic
of a command economy? D. producing, distributing and selling
foods and services in a country
A. Consumers have few, if any, choices in
the market place. 493. A level of material comfort measured by
B. Little government intervention. the goods, services, and luxuries available
C. Also, called “capitalist” economy A. Standard of expense
D. Resources are owned by individuals. B. Standard of cost
C. Standard of living
489. Scarcity is defined as a limited supply of
resources and D. none of above
A. limited wants for those resources 494. Think tank of government of India that
B. unlimited resources replaced the planning commission.
A. Niti dharma
C. limited resources
B. Niti Shashan
D. unlimited wants for available re-
sources C. Niti Aayog
D. None of the above
490. Unemployment measures
A. the value of all final goods and services 495. Advantages include limited liability for
produced owners, unlimited life, and ease of trans-
fer of ownership.
B. an increase in the general price level
A. Sole Propriotorship
C. the percentage of people looking for
work that can’t find it B. Partnership
D. the economic freedom an economy of- C. Corporation
fers D. Franchise
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 301
496. What is a standard of living? 501. Scarcity is a problem
A. the amount of food available to a group A. measured by the amount of goods
PRACTICE BOOK» NOT FOR SALE
of people available.
B. the amount of electricity available to a B. of the poor, but not the rich.
group of people
C. because human wants are unlimited
C. level of wealth and resources avail- while resources are limited
able to a certain socioeconomic class in
D. only in industrialized economies.
a certain geographic area
D. the average amount of money avail- 502. Disadvantages of this type of business in-
able to a group of people clude:company is controlled by sharehold-
ers rather than original owners, must pub-
497. Which of the following is a natural re- lish accounts, and is difficult to start.
source used to produce a hamburger?
A. Sole Trader
A. Cow
B. Partnership
B. Cheese
C. Limited Company
C. Dough for the Bun
D. Franchise
D. Ketchup
503. When demand is higher than the avail-
498. Which of the following is the disadvan- able resources.
tage for a market economy?
A. Scarcity
A. Some individuals needs may not be
B. Market
meet.
C. Capitalism
B. Little government intervention.
D. Factors of Production
C. Great variety of goods or services.
D. Price are determined by market forces 504. Socialist economy is characterised by-
(supply and demand). A. Secondary role of price mechanism
499. How marketing built Lego into the B. Relative equality of income
world’s favourite toy brand C. Selective production of goods
A. Business news D. All of the above
B. Economic news
505. Kenneth needed a new shirt for the foot-
C. Microeconomics ball game this Friday. He went to the mall
D. Macroeconomics and purchased a shirt from H & M. Which
market does Kenneth receive his wages to
500. MONOPOLY REFERS TO purchase the shirt?
A. ONE A. product market
B. MANY B. factor market
C. FEW C. firms
D. HUGE D. household
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 302
506. The business sector can be described as with a home base in one country but oper-
ate partially or wholly in other countries.
A. producers that provide goods and ser- A. Multinational Corporations
vices to satisfy the needs and wants of
B. Globalisation
households
C. Macroeconomics
B. consumers that are working in the
business sector to earn money D. Microeconomics
NARAYAN CHANGDER
C. consumers that purchase goods and
511. Why Study Economics?
services for the business sector
A. I have to do it
D. producers that provide goods and ser-
vices to consumers in order to make a B. I want to learn about the stock market
profit C. To learn how to deal with scarcity
507. The Central Economic problem is that of- D. none of above
A. Allocating the scarce recourse in such
512. What does PPC show? Multiple answer.
a manner that society’s unlimited wants
are satisfied as far as possible A. 2 products → we can ONLY produce
two product per period
B. Giving jobs to poor and backward.
B. Efficiency → operate with full employ-
C. Guaranteeing that the production oc-
ment and full production capacity
curs in most efficient manner
D. All of above C. normative economics
D. various possible combinations of
508. Who among the following would be con- goods and services
sidered as unemployed?
A. A graduating student of legal age to 513. A form of business organization with one
work owner who takes all the risks and all the
profit is called-
B. An entrepreneur in the process of
starting a new business A. partnership
C. A secretary who has resigned from B. proprietorship
work & looking at job ads C. corporation
D. A housewife running 2 internet shops D. governorship
at the same time
514. Which of the following definitions best
509. A major advantage of a is manage-
describes an employee?
ment and training support.
A. They provide financial capital to start
A. Proprietorship
a company
B. Partnership
B. They earn profits in the form of divi-
C. Corporation dend payments from the firm’s profits
D. Franchise C. They have a specific job at the com-
pany for which they are paid
510. Businesses that produce (not just sell) in
more than one country; large businesses D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 303
515. This refers to the largest sector in the D. The amount of debt you take on by mak-
Philippines. ing a decision
PRACTICE BOOK» NOT FOR SALE
A. Agriculture
521. Trump announces tariffs on $60bn in Chi-
B. Industry nese imports.
C. Farming
A. Business news
D. Service
B. Economic news
516. This is needed in every business. Without
C. Microeconomics
this, business operations will stagnate.
A. systems D. Macroeconomics
B. scalability 522. According to Robbins “means” are
C. sustainability
A. Scarce
D. growth
B. Unlimited
517. diffence between expected payoff and ac-
C. Undefined
tual payoff is called
A. 1.deviation D. All of these
B. 2.standard deviation 523. Water and air are examples of re-
C. 3. variability sources, while people are considered to be
D. 4.none of the above resources.
A. capital; human
518. What is an entrepreneur?
A. A person who starts a new business. B. natural; human
B. A leader of a country. C. physical; mental
C. A worker in a factory. D. mental; natural
D. A student in college.
524. Resources such as buildings, equipment,
519. Select three characteristics below that de- and factories.
scribe successful entrepreneurs.
A. Human Resources
A. Risk-takers
B. Capital
B. Innovative
C. Entrepreneurship
C. Uncertain
D. Decisive D. Natural Resources
520. Opportunity Cost is best defined as 525. A small business/enterprise would have
A. the value of the next best alternative
that is given up due to the choice you made A. 10-49 persons employed.
B. The price you pay to purchase some- B. 250 or more persons employed.
thing
C. 50-249 persons employed.
C. The benefit you gain by making a deci-
sion D. less than 10 persons employed.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 304
526. It illustrates how market forces deter- C. 3.return assets
mine the overall shape of the economy. D. 4.none of the above
A. Porter’s 5 Forces
532. Easiest type of business to start
B. Circular Flow Model
A. Corporation
C. SWOT Analysis
B. Sole Proprietorship
D. Economic Analysis
C. Partnership
NARAYAN CHANGDER
527. Bank of America to shift 125 British jobs D. Corporation and Partnership
to Ireland ahead of Brexit (select three)
533. what is scarcity?
A. Business news
A. where you have everything in the
B. Economic news world
C. Microeconomics B. when there’s not enough-the differ-
D. Macroeconomics ence between wants and needs and avail-
able resources
528. Cardinal approach is related to:
C. when you can have however so much
A. Indifference curve of wants you desire
B. Equi-marginal utility D. when you cannot have anything
C. Law of diminishing returns 534. shows various combinations of two
D. None of these products that give same amount of satis-
faction:
529. Hammers, pencils, and computers are ex-
amples of A. ISO cost curve
B. Indifference curve
A. Land
C. Marginal utility curve
B. Labor
D. ISO quant
C. Capital
D. Entrepreneurship 535. What is economics?
A. The study of unemployment
530. determined by subtracting expenses, in-
cluding taxes, from revenue B. The study of the Australian economy
A. merger C. The study of how limited resources are
used to meet the unlimited wants of peo-
B. net income ple in society
C. depreciation D. The study of GDP
D. multinational
536. The main objective of TRYSEM was
E. vertical merger
A. To train rural youth for self-
531. assets that provide a flow of money or employment
service that is known with certainity are B. to train urban youth for self-
called employment
A. 1.riskless assets C. Both of the above
B. 2.risky assets D. None of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 305
537. Public utilities are an example of? owner might lack skills & unlimited liabil-
A. A competitive market ity.
PRACTICE BOOK» NOT FOR SALE
B. Natural Monopoly A. Sole Trader
C. Monopolistic power B. Partnership
C. Limited Company
D. Oligopoly
D. Franchise
538. An advantage that occurs when a busi-
ness is able to offer the same quality prod- 543. Gold demand slides to eight-year low in
uct as its competitors, but at a lower price. third quarter of 2017.
A. differentiation A. Business news
B. cost leadership B. Economic news
C. alliance C. Microeconomics
D. defensive strategy D. Macroeconomics
539. Which type of market structure has many 544. In which category would I find the high-
producers (companies) that sell very sim- est prices?
ilar products and have almost no control A. sole proprietor
over price? B. oligopoly
A. Competitive markets C. perfect competition
B. Oligopoly D. monopoly
C. Monopoly
545. form of business organization recognized
D. none of above by law as a separate legal entity having
540. In the circular flow, what do individuals all the rights of an individual
get in return for their labour? A. corporation
A. Wage B. multinational
B. Salary C. interest
C. Income D. sole proprietorship
D. Money 546. India has
541. change in consumption of a good associ- A. Socialistic economy
ated with change in its price with level of B. Gandhian economy
utility held constant is called
C. Mixed economy
A. 1.substitution effect
D. Free economy
B. 2.income effect
547. An Economy in which goods and services
C. 3.both 1 & 2 are produced. It is used in countries that
D. 4.none of the above are less developed and are not yet partici-
pating in the global Economy.
542. Disadvantages for this type of business
include:owner pays for everything, hard A. Scarcity
to get money to start from the bank, B. Demand
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 306
C. Traditional Economy D. a system of production, resource allo-
cation and distribution of goods and ser-
D. Capitalism
vices within a society or a given geo-
548. Businesses conspiring among themselves graphic area
to set the prices of competing products at
a higher level 553. How do supply and demand influence
market price?
A. Price fixing
A. Supply determines market price be-
NARAYAN CHANGDER
B. Trust cause the seller sets the price.
C. Market sharing B. The price is determined by the highest
D. Oligopoly price consumers are willing to pay.
C. The price is determined by the lowest
549. negotiation by a labor union with man-
price producers are willing to accept.
agement over issues such as pay, working
hours, health care coverage, and vacation D. The market clearing price is where
quantity demanded is equal to quantity
A. collective bargaining
supplied.
B. net income
554. A form of business organization with two
C. cash flow
or more owners who share the risks and
D. principal the profits-
550. Globalisation results in A. proprietorship
A. lesser competition among producers B. corporation
B. greater competition among producers C. wholesale
C. no change in competition among pro- D. partnership
ducers
555. Which form of business is the easiest for
D. none of the above beginners?
551. What are the basic Economic questions? A. Partnership
A. How to produce it? B. Corporation
B. What to produce? C. Sole Proprietorship
C. When to produce it? D. Merchandising
D. For whom to produce it? 556. What occurs when people rely on oth-
ers to provide the goods and services re-
552. what is an economic system?
quired for supporting their lives or for con-
A. a type of system in economy venience?
B. a system in economics which is given A. Economic Interdependence
out due to distribution of economy and so-
B. Transnational Corporations (TNCs)
ciety
C. Globalisation
C. a system which is within a society or a
given geographic area D. Corporate Social Responsibility
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 307
557. What of the following is a feature of a 562. Rational decison making requires that:
monopoly? A. one’s choices be arrived at logically
PRACTICE BOOK» NOT FOR SALE
A. There is plenty of competition and without error.
B. Price is set freely by the consumers B. one’s choices be consistent with one’s
C. The product sold is unique goals.
D. There are very few barriers to entry C. one’s choices never vary.
D. one make choices that do not involve
558. Which of the following does not suggest trade-offs.
a macro approach for India?
A. Determining the GNP of India. 563. Income tax is a
B. Finding the causes of failure of ABC A. direct tax
Ltd. B. voluntary tax
C. Identifying the causes of inflation in In- C. indirect tax
dia. D. sales tax
D. Analyse the causes of failure of indus-
try in providing large scale employment. 564. Where a business is able to buy new tech-
nology and machinery due to it being large
559. For which of the following type of busi- A. Technical
ness, do you think a sole proprietorship
form of organisation would be more suit- B. Managerial
able? C. Purchasing
A. Legal consultancy D. Marketing
B. Grocery store
565. Which one of the following is NOT a sup-
C. Internet cafe ply side policy?
D. none of above A. the government increasing competi-
tion in all industries
560. In economics, the value of the next best
alternative is called B. the government reducing import con-
trols
A. Scarcity
C. the government investing in training
B. Productivity and education
C. Opprotunity Cost D. the government privatising national in-
D. Supply and Demand dustries
561. Advantages of this type of business in- 566. A strategy that businesses often use mar-
clude:selling shares to raise money, lim- keting and some ads are against the com-
ited liability. petitors.
A. Sole Trader A. advertising
B. Partnership B. cost leadership
C. Limited Company C. alliance
D. Franchise D. defensive strategy
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 308
567. Which of these is not an advantage of 572. what best describes how to use the op-
Sole Proprietorship portunities section of the SWOT?
A. If someone has the idea to make a A. Pass this on to your manager to act
profit he or she will be able to upon?
B. Complicated for beginners B. Use your strengths to help make them
happen and use them to off set potential
C. Do not require co-workers threats.
D. Do not have to pay separate business
NARAYAN CHANGDER
C. Ignore them as they will sort them-
income taxes. selves out.
568. Robbins in his definition D. recognise them but do nothing has you
are not yet ready to act upon them.
A. talks of scarcity of resources
573. Resources (a.k.a. the factors of produc-
B. Preaches moral values
tion are)
C. Advises neutrality in economics A. Land and Labor
D. None of the above B. Land and Capital
569. Oprah Winfrey, Guy Fieri, and Steve Jobs C. Entrepreneurship
are examples of resources. D. Land, Labor, Capital and Entrepreneur-
ship
A. Land
B. Labor 574. Economic theories are
C. Capital A. Hypothetical
D. Entrepreneurship B. Accurate
C. Both (1) and (2)
570. If OPEC decided to cut oil production for D. Neither (1) Nor (2)
the coming year, what would be the MOST
LIKELY effect? 575. Marshall defines economics as
A. prices would not change A. The study of mankind in the ordinary
business of life
B. oil prices would probably rise
B. The study of human behaviour as a re-
C. oil prices would probably decline lationship between ends and scarce re-
D. the price for substitute products would sources
decline C. An Enquiry into the Nature and Causes
of wealth of Nations
571. Which following businesses would you
classify as being in the secondary sector D. None of these
of industry?
576. Nominal GDP = Real GDP
A. An oil exploration company A. Inflation
B. A family run farm business B. Unemployment
C. A taxi operating business C. Imports
D. A shoe manufacturer D. Exports
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 309
577. Which type of business organization has 582. Disadvantages include limited life and the
the advantage of limited liability but the potential for conflict between partners
disadvantage of less control over business
PRACTICE BOOK» NOT FOR SALE
A. Sole Propriotorship
decisions?
A. perfect competition B. Partnership
B. partnership C. Corporation
C. sole proprietorship D. Franchise
D. corporation
583. If a town has 60 employed workers
578. According to the circular flow model, and 15 unemployed workers, what is the
which of the following is TRUE? town’s unemployment rate?
A. Firms supply resources and house- A. 15%
holds demand outputs
B. 25%
B. Households supply resources and
firms supply output C. 20%
C. Firms supply both the resources and D. 33%
output used in production
D. Households demand both resources 584. The study of how people choose to use
and outputs limited resources to satisfy their unlimited
needs and wants.
579. Margarine is a good substitute for
A. history
A. butter
B. economics
B. cheese
C. cheddar C. social studies
D. bread D. psychology
580. The quantity of a good or service that con- 585. Which of the following is an advantage
sumers are willing and able to buy at a par- of sole proprietorships:
ticular price during a specific time period.
A. Limited liability
A. Demand
B. Unlimited financial power
B. Supply
C. Price C. Dual taxation
D. Production Cost D. Quick decision making
581. What is not an advantage of a 586. Other things equal, if a good has more
monopoly? substitutes, its price elasticity of demand
A. achieving economies of scale is:
B. high level of research and develop- A. 1.larger
ment
B. 2.smaller
C. Producing a greater quantity at profit-
maximizing level of output C. 3.zero
D. higher prices and lower output D. 4.unity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 310
587. How is a corporation different from a 592. The main disadvantage of a is that
sole proprietorship? each person is fully responsible for the acts
A. Corporations are owned by only one of all other persons.
person A. Proprietorship
B. Corporations can sell stock to raise B. Partnership
money for the business. C. Corporation
C. Sole proprietorships have limited liabil- D. Franchise
NARAYAN CHANGDER
ity for the owners.
593. Which is NOT a type of specialisation?
D. Sole proprietorships require a legal
charter to start the business. A. Location of enterprise
B. Large-scale production
588. Ford and Toyota sells the same products;
it evident that there is a C. Location of industry
A. competition D. Division of labour
B. distribution 594. The principle that consumers tend to buy
less of a good or service when its price in-
C. alliance
creases, all else held equal, is called
D. threats
A. the law of supply
589. The phase of the business cycle where B. the law of demand
real GDP grows for two or more consec-
C. the law of increasing cost
utive quarters is termed
D. the law of maximum satisfaction
A. growth
B. recession 595. Sam loves science and wants to become a
doctor but he is learning how to make clay
C. balance of payments bricks like his father and grandfather.
D. gross domestic product A. Command Economy
590. Since micro economics splits up the entire B. Market Economy
economy into smaller parts for the purpose C. Traditional Economy
of intensive study, it is also known as
D. Market Economy
A. Slicing method
596. The main driver is the number and capa-
B. Bulldozer method bility of competitor in the market.
C. Micro-macro method A. Power of Supplier
D. Micro foundation of macro method B. Power of Customer
591. The process of changing an industry from C. Threats of Substitutes
public to private ownership. D. Competition of New Entrants
A. privatization
597. An Economy that combines elements of
B. public marketing the command and market economies.
C. socialization A. Command Economy
D. economic change B. Opportunity Cost
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 311
C. Mixed Economy A. External forces
D. Capitalism B. Weaknesses
PRACTICE BOOK» NOT FOR SALE
598. How are sole proprietorships and part- C. Core competencies
nerships alike? D. External reviews
A. Contracts are needed to start the busi- 603. What type of network links comput-
nesses. ers and workstations, usually within one
B. Owners have complete control of the building?
business. A. personal digital
C. Owners have limited legal liability. B. wide area
D. The businesses are owned by one per- C. local area (LAN)
son.
D. satellite communication
599. Which is NOT a factor influencing decision
604. McDonald’s and Subway are examples of
whether to spend or to save?
a
A. Income
A. Joint-Venture
B. Weather forecast
B. Franchise
C. Personality
C. Non-Profit Corporation
D. Age
D. Cooperative corporation
600. Goods are
605. Who or what answer the basic economics
A. goods are sold at supermarkets for questions in a mixed economy?
consumption
A. Individuals and Businesses
B. goods are intangible items that cannot
B. Custom
be seen or touched
C. Government
C. goods are actions done by businesses
for consumers D. Individuals, Businesses and Govern-
ment
D. goods are physical, tangible products
that can be seen and touched 606. A major task of the Department of Trade
and Industry is toencourage exports
601. The Bank of England raises interest rates,
signals confidence in strengthening econ- A. VAT
omy. B. AGRICULTURE
A. Business news C. INDUSTRIES
B. Economic news D. SOCIAL COST
C. Microeconomics 607. A franchise is
D. Macroeconomics A. where a business is owned by share-
602. Political climate, economic shifts, laws holders
and regulations, technology, industry B. where a business sells the rights to
trends, and competition are all examples distribute its products under its name to
of: other individuals or businesses
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 312
C. where a business sells its products to A. The contributions from different part-
other businesses ners
D. where businesses merge to create one B. How major decisions are made
big business C. How workers are hired and trained
608. In which year demonetization happen? D. How the partnership may be ended
A. 28th November 2015 613. At equilibrium under ordinal approach the
MRS should be equal to
NARAYAN CHANGDER
B. 8th November 2016
C. 16th October 2010 A. MRTS
D. 22nd July 2011 B. Price Ratio
C. Price
609. The company decides to open its market
to foreign countries where there is a need D. Income
for your product. How does this informa- 614. A form of business organization that is
tion fit into the SWOT analysis? authorized to act as a legal entity regard-
A. It’s a threat less of the number of owners.
B. It’s an opportunity A. corporation
C. It’s a strength B. proprietorship
D. It’s a weakness C. partnership
D. distributor
610. An individual or group who buys prod-
ucts. 615. In which of the following would one per-
A. Product son be responsible for all of the risks but
also receive all of the profits?
B. Business
A. Corporation
C. Customer
B. Propreitership
D. Service
C. Partnership
611. The study of economics is primarily con- D. Dual owner business
cerned with:
616. If new competitors can enter your market
A. demonstrating that capitalistic
easily because the are few barriers, your
economies are superior to socialistic
is high.
economies.
A. supplier power
B. determining the most equitable distri-
bution of society’s output. B. threat of substitution
C. keeping private businesses from los- C. margin
ing money. D. threat of new entry
D. choices/decisions that are made due
617. How do governments, businesses and in-
to lack of resources
dividuals deal with having unlimited needs
612. Which one of the following may NOT be and wants with scarce resources?
included in a partnership agreement? A. By making trade-offs.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 313
B. By figuring out how to satisfy every C. the corporation is subject to many gov-
want and need. ernment regulations.
PRACTICE BOOK» NOT FOR SALE
C. By focusing on wants first and then D. the corporation pays limited taxes
needs.
623. The Problem of ‘What to Produce’ covers
D. There is literally no answer. the issue relating to-
618. A joint venture is: A. What goods are to be produced?
A. Two businesses working together for a B. What quantities of goods are to be pro-
limited time duced?
B. Two businesses joining up forever C. Both (1) and (2)
C. Two businesses who have split stock D. Neither (1) Nor (2)
D. none of above
624. Because of the problem of scarcity, each
619. What is a disadvantage of a mixed econ- economic system must make which of the
omy? following choices?
A. Private ownership of resources A. How to produce?
B. Government regulations B. What to produce?
C. Inequities in the distribution of wealth C. For whom to produce?
D. Strong social networks D. All of these.
620. A firm is said to be a Public Joint-Stock 625. is the list with specific quantities of
Company when itA. is owned by the gov- one or more goods
ernmentB. operates as a public corpora- A. 1.consumer preferences
tionC. is a limited liability companyD. sells
its shares to members of the public B. 2.market baskets
A. A C. 3.consumer behavior
B. B D. 4.none of the above
C. C 626. Economics is a
D. D A. Science
621. What is the main idea of the section B. Art
“Money Matters”? C. Both (1) and (2)
A. Money is power. D. Neither (1) Nor (2)
B. Money is a luxury.
627. what is a market?
C. Everyone needs money.
A. where you can buy new dresses
D. Money has changed over time
B. where you can text people back and
622. One disadvantage of a corporation is fourth
A. the corporation provides limited liabil- C. where you go to draw out money
ity for its owners. D. where buyers and sellers exchange
B. the corporation can sell stock to raise any types of goods, services and informa-
revenue. tion
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 314
628. Which of these are examples of govern- C. Provide skills, knowledge, effort and
ment revenue other intangible benefits
A. income tax D. none of above
B. credit
634. A subsidiary is
C. pensions
A. A company that is mostly owned by an-
D. work for the dole other company
NARAYAN CHANGDER
629. Goods and services that are produced in B. A company that is at least half-owned
our country and sold to buyers in another by a bigger company
country are called C. A company that is combined with an-
A. exports other company to make a conglomerate
B. imports D. A company of which less than 25% is
C. external purchases owned by another company
D. external sales 635. organization that pools funds of individ-
ual investors to buy a large number of dif-
630. The process of choosing which needs and
ferent stocks or other financial assets are
wants will be satisfied.
called
A. Economic Decision Making
A. 1.mutul funds
B. Goods
B. 2.stock market
C. Command Economy
C. 3. insurance company
D. Demand
D. 4.none of the above
631. A business partnership has who
share the risks and the profits. 636. Advantages of this business type are that
the owner is their own boss and gets to
A. One owner
keep all the profits.
B. No more than three owners
A. Partnership
C. Two or more owners
B. Sole Trader
D. Five or more owners
C. Limited Company
632. MPC stand for D. Franchise
A. Marginal Propensity to Consume
637. which of the following is not the subject
B. Magical Proportion of Consumption
matter of Business economics?
C. Marginal Potential to Consume
A. Should our firm be in this business?
D. Marginal Propensity of Consumers
B. How much should be produced and at
633. Service (tertiary) producers price should be kept?
A. Generally produce food-products that C. How will the product be placed in the
are grown from the land or sourced from market?
nature D. How should we decrease unemploy-
B. Manufacture goods in factories ment in the economy?
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 315
638. Administered prices refer to: 643. Discounts, price cutting, Advertisements,
etc in capitalist economy are-
A. Prices determined by forces of de-
PRACTICE BOOK» NOT FOR SALE
mand and supply A. Types of government regulation
B. Prices determined by sellers in the B. Effects of consumer sovereignty.
market C. Method of handling competition.
C. Prices determined by an external au- D. None of the above.
thority which is usually the government
644. The ACCC stands for:
D. None of the above
A. Australian Competition & Consumer
639. Economist Thomas Malthus believed that Commission
would limit economic progress. B. Australian Consumer & Competition
A. depletion of gold reserves Contracters
B. overpopulation C. Asia Competition & Consumer Commis-
sion
C. the tendency of governments to levy
high tax rates D. none of above
D. the inability of workers in developed 645. is the name of a free-market eco-
nations to compete against cheap foreign nomic system in which most of the factors
labor of production and distribution-such as land,
factories, railroads, and stores-are owned
640. Who took over as the new Vice Chairman by individuals.
of Niti Aayog in September 2017?
A. Socialism
A. Arvind Panangriya
B. Capitalism
B. Raghuram Rajan C. Communism
C. Rajeev Kumar D. Marginalism
D. Rajiv Singh
646. Which of the following is an advantage
641. This is NOT part of the tertiary sector of the corporation as a form of business
ownership:
A. Transport
A. Less complex requirements
B. Construction
B. Separate owners and managers
C. Trade
C. Limited liability
D. Education
D. High Taxes
642. A situation where people exchange goods 647. Effective efforts put to acquire something
and services is referred to as: will be
A. A market A. Want
B. The Producer Rights Law B. Desire
C. A Mixed Market Economy C. Need
D. Scarcity D. Demand
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 316
648. Law firms and doctor’s offices are exam- 653. No paperwork (charter or agreement) is
ples of required to start which type of business?
A. Sole Proprietorships A. Partnership
B. Partnerships B. Franchise
C. Corporations C. Sole Proprietorship
D. Franchises D. Corporation
654. Disadvantages of this type of business
NARAYAN CHANGDER
649. The THREAT section is mainly areas that:
include:parent company is strict, you are
A. Can be easily removed and turned in to limited in what you sell, and you must op-
strengths erate like every other franchise.
B. Cannot be removed or ignored and will A. Sole Trader
need planning to work with or around. Are
B. Partnership
a potential risk to your development.
C. Corporation
C. Nasty things that have been said to you
D. Franchise
D. Are areas that you threaten your
safety 655. A principle in which everything must
work together from employee to president
650. The constant rise in the general level of or from equipment to resources.
prices over a period of time is termed
A. systems
A. expansion
B. scalability
B. inflation
C. sustainability
C. unemployment D. growth
D. consumption
656. Iron, minerals, coal and plants are exam-
651. If a local government sets an apartment ples of which productive resource?
rent control price below the equilibrium, A. land
what is the MOST LIKELY outcome?
B. labor
A. The demand and supply will increase. C. entrepreneurship
B. The increased supply will create a sur- D. capital
plus.
657. Which is NOT a feature of Wants
C. The increased demand will create a
shortage. A. Recur
D. The demand will decrease and the sup- B. Competitive
ply will increase. C. Complementary
652. The term used for costs that change with D. Limited
the number of output 658. Death of owner ends the business
A. Fixed Cost A. Partnership
B. Average Cost B. Sole Proprietorship
C. Variable Cost C. Corporation
D. Marginal Cost D. Sole Proprietorship and Partnership
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 317
659. The difference between a country’s ex- 664. What is the purpose of monetary policy?
ports and imports. A. To change the interest rates depend-
PRACTICE BOOK» NOT FOR SALE
A. balance of trade ing on the circumstances in the economy
B. foreign debt B. To make people pay more money on
their home loans
C. opportunity cost
C. To reduce the amount of debt the gov-
D. comparative advantage
ernment has
660. what is a capitalist economy? D. To increase or lower the taxes on im-
ported goods
A. an economic system in which pri-
vate individuals or businesses own capital 665. Which of the following is not a macro ap-
goods proach for India?
B. an economy directed to basic subsis- A. Determining the GNP of India.
tence rather then to the market
B. Finding the causes of failure of ABC
C. type of economic system where invest- Ltd.
ment, production and the allocation of cap-
ital goods take place C. Identifying the causes of inflation in In-
dia.
D. none of above
D. Analyse the causes of failure of cotton
661. This type of business is owned by many industry in providing large scale employ-
people called stockholders. ment
A. Sole Proprietorship 666. Till 19th century Economics was known
B. Partnership as
A. Political Economy
C. Corporation
B. Social Economy
D. Franchise
C. Both (1) and (2)
662. The real or imagined differences between
D. Neither (1) Nor (2)
competing products in the same industry.
A. Price competition 667. The goal of a company in an oligopoly in-
dustry is to
B. Product differentiation
A. Increase market share and profits.
C. Marketing differential
B. Obtain the highest price possible.
D. Oligopoly
C. Always follow rivals if they raise price.
663. An economic system where the economic D. Be the market leader in innovation.
resources are privately owned by individ-
uals rather than the government. 668. If it costs me $10 to make the first 10
bowls of cereal and $12 to make the next
A. Busienss
10 bowls of cereal, what is my marginal
B. Scarcity (extra) cost?
C. Capitalism A. $120
D. none of above B. $10
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 318
C. $2 C. Franchise
D. $100 D. none of above
669. APC is equal to 674. An example of a local monopoly is
A. 1-APS A. a big city restaurant.
B. 1 / APS B. a new dentist in a big city.
C. 1-MPS
C. the only veterinarian in an isolated
NARAYAN CHANGDER
D. Consumption / Income farm community.
670. Dan has $5, 000. He wants to invest his D. none of above
money in the type of business that has the
least amount of liability. In which type of 675. A competitive market is characterized by
business should he invest? A. a large number of sellers and buyers.
A. corporation B. diverse products.
B. partnership C. sellers acting together to set prices.
C. proprietorship D. uninformed buyers and sellers.
D. none of above
676. Two factors involved in determining the
671. Globalisation can be defined as value of a resource, good, or service are
A. Economic transactions that are made A. availability and trade-offs.
between countries
B. demand and desires.
B. The exchange of goods and services
among individuals and businesses in mul- C. productivity and opportunity costs.
tiple countries D. availability and demand.
C. The process of interaction and integra-
tion among people, companies, and gov- 677. Which is NOT a classification of Wants
ernments worldwide A. Necessities
D. A change in global or regional climate B. Luxuries
patterns
C. Comforts
672. GDP divided by = GDP per capita D. Secondary
A. population
678. refers to the process of selecting an
B. income
appropriate alternative that will provide
C. wealth the most efficient means of attaining a de-
D. production sired end, from two or more alternative
courses of action
673. Disadvantages include high fees, strict A. problem solving
operating standards, little freedom, intru-
sive monitoring B. Problem analyzing
A. Sole Propriotorship C. Managerial expertise
B. Partnership D. Decision making
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 319
679. Micro analysis deals with the 684. Total utility starts decreasing when
A. Allocation of resources of the economy A. Marginal utility is positive
PRACTICE BOOK» NOT FOR SALE
as between production of different goods B. Marginal utility becomes negative
and services
C. Marginal utility becomes zero
B. Determination of prices of goods and
services D. None of above.
C. Behavior of individual decision makers 685. Which of these is an example of govern-
D. All of the above ment expenditure?
A. Social Security and Benefits
680. A major disadvantage of a is the dou-
ble taxation of profits. B. Company tax
A. Proprietorship C. Sales tax (GST)
B. Partnership D. Fuel excise
C. Corporation 686. The increased movement between na-
D. Franchise tions of trade, labour, investment, finance
and technology.
681. The main disadvantage of a is that
the owner of the business has unlimited A. Globalisation
liability. B. Macroeconomics
A. Proprietorship C. Microeconomics
B. Partnership D. Economic Model
C. Corporation
687. Modern definition-
D. Franchise
A. Science is Wealth
682. A target market is a group of that B. Science of scarcity
the has decided to aim its marketing
efforts and ultimately its merchandise to- C. Science of Material welfare
wards. D. Science of Dynamic Growth and Devel-
A. Companies, Business opment
B. Companies, Research 688. Tools
C. Customer, Business A. Land
D. Business, Customer B. Labor
683. Which describes an oligopoly? C. Capital
A. A firm that is easy to start and has little D. Entrepreneurship
control over prices
689. Scarcity means:
B. A firm that is impossible to start and
has total control over prices A. Too much of something you wanted
C. A firm that is difficult to start and has B. The exact amount of something you
some competition wanted
D. A firm that has lots of competition and C. Not enough of something you wanted
needs to compete outside of prices D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 320
690. An indifference curve is always: C. Creative ways to solve problems in so-
A. (a) Concave to the origin ciety
B. (b) Convex to the origin D. Making a profit
C. (c) L-shaped 696. What was the maximum strength of full
time members in the planning commis-
D. (d) A vertical straight line
sion?
691. Land, labour, capital, knowledge and en- A. 8
NARAYAN CHANGDER
trepreneurship are collectively known as
B. 6
A. Goods and services
C. 11
B. Business cycle
D. 10
C. Factors of production
697. Capital is
D. Output
A. the money or cash on hand that a busi-
692. The economic resources a nation uses to ness has at their disposal
make goods and supply services for its B. all the equipment used by human
population. labour in the process of production
A. Product C. all the equipment used when to create
B. Market goods and services for the consumers
C. Scarcity D. the resources required to produce
goods and services for consumers
D. Factors of Production
698. Who was the first Chairman of planning
693. Needs and wants are , while our re-
commission?
sources are
A. Rajendra Prasad
A. satisfied, unsatisfied
B. S. Radhakrishnan
B. limited, unlimited
C. J.Nehru
C. unlimited, limited
D. B.R. Ambedkar
D. necessary, unnecessary
699. Who was the first economist who used
694. A business owner who prefers to main- the term ECONOMIC in the place of politi-
tain complete control of all business activi- cal economy?
ties might consider structuring the venture
A. Alfred Marshall
as a(n)
B. Lionel Robbin
A. sole proprietorship
C. J.M. Keynes
B. general partnership.
D. Paul. A. Samuelson
C. franchise
D. corporation. 700. The cartel model of oligopoly leads to:
A. All the firms in the industry acting as
695. Innovation in business involves: one to set a monopoly price
A. Creating Art B. Each producer acting independently of
B. Creating Music others
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 321
C. Firms following the low-price firm in C. Sole Proprietorship
the industry
D. Corporation and Partnership
PRACTICE BOOK» NOT FOR SALE
D. Differences in cost of production dis-
couraging individual firms from cheating 706. An industry that is dominated by a few
large firms is
701. At equilibrium, the slope of the indiffer-
ence curve is: A. A competitive market
A. (a) Equal to the slope of budget line B. A monopoly
B. (b) Greater than the slope of budget C. An oligopoly
line
D. none of above
C. (c) Smaller than the slope of budget
line 707. Micro economics is a study of
D. (d) None A. Whole economy
702. Micro economics deals primarily with B. General price level
A. Comparative statics, general equilib- C. National Output
rium and positive economics
D. individual economic unit
B. Comparative statics, partial equilib-
rium and normative economics 708. Which one of these is NOT a cause of
C. Dynamics, partial equilibrium and pos- scarcity?
itive economics A. overproduction of time
D. Comparative statics, partial equilib- B. not enough materials
rium and positive economics
C. Poor Distribution of Resources
703. The total amount of a good or service
D. Rapid Increase in Demand
that is available to buy is called
A. demand 709. The process by which one or two or more
B. incentive persons engage in commercial activity for
profit.
C. profit
A. Business
D. supply
B. Commerce
704. Australia’s biggest export in 2017 was
C. Trade
A. Iron ore D. Partnership
B. Wheat 710. Taxes and subsidies are taken into ac-
C. Natural gas count when calculatingGDP at basic prices
D. Coal A. exports
705. Complex and expensive to set up B. commodities
A. Partnership C. production
B. Corporation D. imports
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 322
711. what is economy? 716. is used to show opportunity cost.
A. society A. Production Possibility Front/Curve
B. the way a nation makes economic B. Production Possibility Cost
choices about how the nation will use C. Production Possibility Opportunity
its resources to produce and distribute
goods and services D. Production Possibility Level
C. the way in which the government de- 717. Consumers are typically most willing to
NARAYAN CHANGDER
cides on how things will be run fairly in pay more for goods and services that bring
the nation them greater
D. none of above A. opportunity costs.
712. When supply goes up, what happens to B. satisfaction.
the price? C. popularity.
A. price goes up D. trade-offs.
B. price goes down 718. What does the word transaction mean?
C. price remains the same A. a dialogue
D. none of above B. a conversation
713. Elements in the environment that could C. the way spends something
cause trouble for the business are D. a business deal
A. Strenhts
719. maximum amount of money that a risk
B. Weaknesses averse person will pay to avoid taking a
C. Opportunities risk is called
D. Threats A. 1.risk premium
B. 2.risk neutral
714. a corporation that has operations in a
number ofdifferent countries C. 3. risk averse
A. merger D. 4.risk loving
B. net income 720. On which approach, indifference curve
analysis is based?
C. depreciation
A. Cardinal approach.
D. multinational
B. Ordinal approach.
E. vertical merger
C. Cardinal and ordinal both.
715. A major disadvantage of a is strict
D. None of the above.
operating standards.
A. Proprietorship 721. Susie is starting her own lemonade store.
What economic term would best describe
B. Partnership
Susie and what does that term mean?
C. Corporation A. Consumer-a person who uses or con-
D. Franchise sumes goods
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 323
B. Partnership-partner in the lemonade C. limited life
stand D. credit union
PRACTICE BOOK» NOT FOR SALE
C. Entrepreneur person who takes a
risk to start a new company 727. Which of these is an example of a public
good?
D. none of above
A. Roads
722. Which of these is the best definition of B. Clothing
the ‘economic problem’?
C. McDonalds
A. People do not have enough money.
D. Houses
B. There are not enough resources to sat-
isfy people’s wants. 728. A decrease in taxation is an example of
C. There are too many factors of produc- a decision made by which sector:
tion. A. Household
D. The amount of something produced by B. Business
a person, machine or industry.
C. Financial
723. Which statement is NOT true? D. Government
A. Young people tend to dis-save E. Overseas
B. Retired people tend to dis-save
729. What are the three main forms of busi-
C. Middle-aged people tend to dis-save ness in today’s economic
D. People tend to save proportionately A. Sole proprietorship, the partnership,
more during middle age Market economy
724. Another term for the Economic Problem B. Partnership, Sole Proprietorship, Cor-
poration Economy
A. Finite
C. Merchandising Business, Sole propri-
B. Scarcity etorship, Partnership
C. Economics D. The sole proprietorship, the partner-
D. Production ship, and the corporation
725. The term “Slam “ is associated with 730. Identify the need in this list
A. Cricket A. Pure Oxygen
B. Tennis B. Water
C. Boxing C. Carbonated Water
D. Football D. Day Spas
726. financial organization that accepts de- 731. How is a corporation different from a
posits from, and makes loans to, employ- sole proprietorship or partnership?
ees of a particular company or government A. A corporation has only one or two own-
agency ers.
A. net income B. A corporation is usually owned by one
B. inventory person.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 324
C. A corporation requires a legal charter 737. Interdependence refers to:
with the state. A. The cyclical relationship between the
D. The owners (stockholders) have lim- savings and investment sectors of the
ited liability. economy
B. The dependence of workers on wages
732. In most businesses, what is the most
costly factor of production? C. The reliance that exists between all
participants in the economy on each other
A. Entrepreneurship
NARAYAN CHANGDER
D. Solving unlimited needs and wants
B. Land Capital
with limited resources
C. Human Capital
738. Economics is the study of
D. Capital Stock
A. how society manages its unlimited re-
733. Which one of these is the impact of unem- sources.
ployment? B. how to reduce our wants until we are
A. Crime rate increase satisfied.
B. All of the above C. how to fully satisfy our unlimited
wants.
C. Decrease in the country’s GDP
D. how to avoid having to make trade-
D. Political disturbance offs.
734. The type of economic system a country 739. Which of the following is an economic ac-
has is based on: tivity?
A. wants and needs. A. Friends playing Chess.
B. the amount of government involve- B. Boy drawing a picture.
ment in the marketplace.
C. A man polishing shoes
C. the scarcity of resources.
D. Mother scolding her children for not
D. where resources are available. doing study.
735. This type of business is owned by many 740. When comparing the four main types
people called shareholders. of business organisations, which protects
A. Sole Trader owners the MOST from personal financial
liability?
B. Partnership
A. Sole Trader
C. Limited Company
B. Partnership
D. Franchise
C. Franchise
736. What does “N” stands for? D. Limited Company
A. Nominal
741. How do you satisfy your unlimited wants
B. National in a world of limited resources?
C. Numbered A. by making more money
D. Numerical B. by making choices
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 325
C. by stealing 747. is the change in total revenue irre-
D. by setting a budget spective of changes in price or due to the
effect of managerial decision on revenue
PRACTICE BOOK» NOT FOR SALE
742. Marginal utility is a Concept. A. Average revenue
A. Cardinal B. Total revenue
B. Ordinal C. Marginal revenue
C. Both D. Incremental revenue
D. None
748. What is the fundamental role of fiscal pol-
743. Which of the following would be an ex- icy?
pansionary monetary policy (increase in A. controlling the budget deficit
economic growth)? B. establishing automatic stabilisers
A. raising wages of prison staff C. reducing government regulations
B. raising interest rates D. making revenue and expenditure deci-
C. lowering interest rates sions
D. lowering government spending 749. What is the term for the restrictions that
government places on harmful products
744. price paid for the use of another’s money
and/or services?
A. interest
A. Taxes
B. sole proprietorship B. Externations
C. labor union C. Exterminates
D. inventory D. Externalities
745. The best superhero 750. Which of the following is NOT an impor-
A. is the Flash tant economic question related to scarcity
that every nation must answer?
B. is the Flash
A. What should we produce?
C. is the Flash
B. How should we produce it?
D. is the Flash
C. For whom should we produce it?
746. The introduction of a minimum wage in a D. What are the factors of production?
labour market will:
A. raise employment and lower the wage 751. What is a computer-based system that
rate allows people to communicate simultane-
ously from different locations via tele-
B. raise the wage rate and increase em- phone, e-mail, or video?
ployment
A. the Internet
C. raise the wage rate and decrease em-
ployment B. groupware
D. reduce the wage rate but boost em- C. a data communication network
ployment D. electronic conferencing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 326
752. In order to save cost, the “Food Industry” A. Investment, Government expenditure,
should use more labor than machines.” Exports
This statement refers to: B. Savings, Taxation, Imports
A. What to produce C. Investment, Exports, Imports
B. How to produce D. Savings, Taxation, Exports
C. How many to produce
758. non-cash charge a firm takes for the gen-
D. Who to produce for eral wear and tear on its capital goods
NARAYAN CHANGDER
753. Freedom if choice is advantage of- A. interest
A. Socialist economy. B. unlimited liability
B. Controlled economy C. consumer cooperative
C. Capitalist economy D. depreciation
D. None of the above 759. John only had $40 to spend and couldn’t
decide whether to buy a new pair of jeans
754. London introduces charge on most pollut- or to go to an amusement park. He finally
ing vehicles. decided to spend his money on the amuse-
A. Business news ment park. What was the opportunity cost
B. Economic news of his decision?
A. New pair of jeans
C. Microeconomics
B. $40
D. Macroeconomics
C. No opportunity cost was involved.
755. Agency that is responsible for protecting
D. Trip to amusement park
consumers from unfair or deceptive busi-
ness practices. 760. What is Adam Smith’s “invisible hand? ”
A. Federal Trade Commission A. God
B. Better Business Bureau (BBB) B. The process that turns self-directed
C. Consumer Product Safety Commission gain into social and economic benefits.
C. The controlling fist of the government
D. none of above D. His wife who always supported him in
his work
756. When a person who is actively search-
ing for employment is unable to find work, 761. Products are commonly known as
this is
A. needs and wants
A. expansion
B. goods and services
B. inflation
C. factors of production
C. unemployment
D. functions of business
D. consumption
762. Advantages of this business in-
757. In the Circular Flow Model, leakages are clude:easier to get money from the bank
to start, share skills and share risks.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 327
A. Sole Trader 768. The customer of a service business is of-
B. Partnership ten called a
A. Customer
PRACTICE BOOK» NOT FOR SALE
C. Limited Company
B. Consumer
D. Franchise
C. Client
763. Who is the father of modern economics? D. None of the above
A. Adam Smith
769. risk can be reduced by
B. Thomas Malthus A. 1.diversification
C. Donald Trump B. 2.insurance
D. none of above C. 3. additional information
764. South Africa benefits directly from D. 4.all of the above
tourism because of the increasein tourist 770. All of the following details describe the
laws of supply and demand EXCEPT:
A. benefit A. as demand goes down, prices go down
B. taxation B. as supply goes down, prices go up
C. income C. as supply goes up, prices go down
D. expenditure D. as demand goes up, prices go down
765. This is NOT part of the secondary sector 771. . A business which has its own identity
and is distinct from the owners is called
A. Energy Industries
B. Construction A. Autonomy
C. Base industries B. Big Idea
D. Transport C. Profitability
766. Things you can see or touch. D. Scalability
A. Goods 772. Producers and consumers determine how
to use resources and make goods based on
B. Opportunity Cost
supply and demand in the market, without
C. Producers government interference.
D. Needs A. Command System
767. Who is the person who is in charge of op- B. Traditional System
erating systems for gathering, organizing, C. Market System
and distributing information? D. Mixed System
A. information systems manager 773. In economics, capital goods include
B. operations manager A. buildings and equipment.
C. communications manager B. labor and management.
D. research and development manager C. mental and physical work.
E. production manager D. trees and water.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 328
774. Indifference curves never intersect each 780. Eataly’s sights set on China with possible
other due to: joint-venture
A. Different levels of satisfaction A. Business news
B. Same levels of satisfaction B. Economic news
C. Convex to origin
C. Microeconomics
D. Concave to origin
D. Macroeconomics
NARAYAN CHANGDER
775. In which economic system is business al-
lowed to fail and succeed based on their 781. Discuss the trend line in the forecasting
own merrit? of business cycles.
A. Mixed A. A fall in bussiness cycle
B. Command B. rise in income
C. Market C. fall in taxes
D. Traditional
D. fall in gdp
776. Sainsbury’s vows Asda will cut prices.
782. What describes the next best alternative
A. Business news that must be given up in order to purchase
B. Economic news a good or service
C. Microeconomics A. Opportunity Cost
D. Macroeconomics B. Consumers
777. When marginal utility from the consump- C. Living Standards
tion of a commodity is zero, then the:
D. Production Cost
A. Total utility is zero
B. Total utility is highest 783. Inflation measures
C. Total utility is rising A. the value of all final goods and services
D. Total utility is falling. produced
B. an increase in the general price level
778. What is Greek term name of economics
A. Oikos + Nomos C. the percentage of people looking for
work that can’t find it
B. Nomes + kosio
D. the economic freedom an economy of-
C. Okios + Nomso
fers
D. Kosio+ Nomes
784. Which type of business has a greater sta-
779. What is the desired rate of growth for
bility and expertise to run the business?
GDP?
A. Sole Trader
A. 3-4%
B. 2-3% B. Partnership
C. 1-3% C. Both
D. 4-5% D. Neither
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 329
785. Which type of business organization 790. in a economy, individuals are free to
places all the liability on a single seller? make their own economic decisions.
PRACTICE BOOK» NOT FOR SALE
A. Sole Proprietorship A. Market
B. Partnership B. command
C. Corporation C. centrally-planned
D. none of above D. traditional
786. No paperwork (memorandum or agree- 791. What does GDP stand for?
ment) is required to start which type of A. Gross Domestic Production
business?
B. Greater Domestic Product
A. Partnership
C. Greater Domestic Production
B. Franchise
D. Gross Domestic Product
C. Sole Trader
792. Fishing, Mining, Farming, and Forestry
D. Limited Company
are examples of what economic activity?
787. Which of the following statement is cor- A. Primary
rect about Niti Aayog?
B. Secondary
A. Niti Aayog was formed 25th January
C. Teritiary
2016
D. Quaternary
B. Niti Aayog comes under the ministry of
commerce & industry. 793. Mary Ann sells government produced
C. The full form of Niti Aayog is National cars. At the end of the month Mary Ann
Institute for transforming India. must give all of the money she made back
to the government.
D. The Niti Aayog is a policy think tank of
the Government of India. A. Market System
B. Command System
788. A manager is willing to accept the pro-
duction of fewer products as long as their C. Traditional System
workers produce higher-quality products. D. Mixed System
The manager is making a(n)
794. Once the SWOT is completed what must
A. exchange.
you do to ensure you gain the benefit from
B. trade-off. it?
C. capital good. A. Leave in a file.
D. distribution. B. Hand it to your manager
789. The ultimate goal of all economic activity C. Review it on a regular basis
is D. Give it to you work colleague and get
A. consumption. them to follow it.
B. production. 795. What is the currency in India?
C. exchange. A. Dollars
D. distribution. B. Yen
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 330
C. Rupee 801. Which statement about forming a corpo-
ration Is FALSE
D. Euro
A. Is a formal and legal arrangement
796. We mainly study the following in Micro- B. Must file permission from the govern-
Economics: ment
A. General price level C. Write your corporate bylaws
B. National income and output D. Have for obligation a partnership
NARAYAN CHANGDER
C. Demand of industry 802. Where a firm benefits from being able to
D. Employment and economic growth hire highly skilled staff due to it being a
large company.
797. two goods for which marginal rate of sub- A. Purchasing
stitution is zero or infinite B. Managerial
A. 1.perfect substitutes C. Technical
B. 2.perfect complements D. Financial
C. 3.perfect elastic 803. Which type of business organization is
D. 4.none of the above managed by a Board of Directors?
A. Sole Proprietorship
798. Which one of the following is not part of
B. Partnership
the business cycle?
C. Government
A. Growth
D. Corporation
B. Slump
804. An entrepreneur can choose to have
C. Recession
which type of business organization?
D. Maturity A. Sole Proprietorship
799. If businesses can decrease the amount of B. Partnership
labor needed to increase inventories, the C. Corporation
result will most likely be- D. All of the above
A. increased taxes
805. A building is an example of which eco-
B. economic growth nomic resource?
C. increased inflation A. Natural
D. decreased productivity B. Human
C. Capital
800. Raw materials (i.e. cotton, oil etc.)
D. I need more information.
A. Land
806. Which business activity is comprised of
B. Labor day-to-day functions?
C. Capital A. Financial
D. Entrepreneurship B. Investing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 331
C. Operations 812. What does GST stand for?
D. none of above A. Gross Supply Trade
PRACTICE BOOK» NOT FOR SALE
B. Goods and Services Trade
807. Seeing a movie at a theater would be con-
sidered a(n) want. C. Goods and Supply Tax
A. unlimited D. Goods and Services Tax
B. limited 813. Changes in technology will lead to a
business cycle.
C. economic
A. demand-driven
D. noneconomic
B. supply-driven
808. Not having enough resources to satisfy C. political
every need.
D. inflation
A. Trade-off
B. Goods 814. Which type of business has to share prof-
its, responsibility and liabilities?
C. Scarcity
A. Sole Trader
D. Services
B. Partnership
809. Global oil demand to rise despite push for C. Both
renewables D. Neither
A. Business news
815. Competitive advantages that can also be
B. Economic news gained by business that seek cooperation
C. Microeconomics within or related industries is termed as
D. Macroeconomics
A. Alliance
810. The limited resources available to satisfy B. Cost-leadership
the unlimited needs and wants of people.
C. Defensive strategy
A. economics
D. Threats
B. scarcity
816. A partnership agreement is a contract
C. A problem that defines the terms of a partnership,
D. inflation such as:(Select the FOUR that are correct)
A. The contributions from different part-
811. Products use as replacements to other ners
products that gives the same purpose.
B. How major decisions are made
A. clone
C. How profit or loss is shared
B. substitutes
D. How the partnership may be ended
C. class a
E. Details of the business office decora-
D. overruns tions
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 332
817. A market dominated by a few large firms 822. Which condition is a result of open com-
is called: petition in a free market system?
A. Oligopoly A. government regulation
B. Labour Market B. higher quality goods
C. Monopoly C. higher prices
D. Government intervention D. poor customer service
NARAYAN CHANGDER
818. Which economist said that money is the 823. Agency that protects consumers from
measuring rod of utility? dangerous products.
A. A.C Pigou A. Environmental Protection Agency
B. Marshall B. Federal Trade Commission
C. Adam Smith C. Consumer Product Safety Commission
D. Robbins (CPSC)
D. none of above
819. Which of the following definitions of eco-
nomics includes the economic concept of ‘ 824. Which of these is not a service provided
scale of preferences’? by the government?
A. Wealth defintion A. Australia Post
B. Welfare definition B. ABC
C. Scarcity definition C. Restaurants
D. None of the above D. Sewerage system
820. What is the definition of the economic 825. What should the government do to the
term Opportunity Cost? value of £to increase exports and eco-
A. the value of the next best alternative nomic growth?
that is given up due to the choice you made A. Increase the value of the pound (ap-
B. The price you pay to purchase some- preciation)
thing B. Decrease the value of the pound (de-
C. The benefit you gain by making a deci- preciation)
sion C. Revaluation of the pound
D. The amount of debt you take on by mak- D. None of the above
ing a decision
826. The economic problem is that
821. In this economic system individuals and A. resources are limited and wants are
businesses own all of the resources, but limited.
government intervention attempts to pro-
tect both consumer and business interests. B. resources are unlimited and wants are
limited.
A. Mixed
C. resources are limited and wants are
B. Strong Command unlimited.
C. Moderate Command D. resources are unlimited and wants are
D. Traditional unlimited.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 333
827. Which of these is not a disadvantage of B. 5
Sole Proprietorship C. 4
PRACTICE BOOK» NOT FOR SALE
A. Unlimited liability D. 2
B. Easy raising capital
833. A business with the main purpose of gain-
C. The small size of Sole Proprietorship ing profit is called
D. Limited managerial experience A. Autonomy
828. Adam smith published his masterpiece B. Big Idea
“An enquiry into the nature and causes of C. Profitability
wealth of nation” in the year D. Scalability
A. 1776
834. A corporation that has at least four busi-
B. 1786 nesses, each making unrelated products,
C. 1756 none of which is respon-sible for a major-
ity of its sales, is called a
D. 1766
A. multinational.
829. Business Economics is
B. horizontal corporation.
A. Abstract and applies the tools of Micro
C. conglomerate.
economics
D. vertical merger.
B. Involves practical application of eco-
nomic theory in budiness decision making 835. One advantage of a is that the owner
C. Incorporate tools from multiple disci- can keep the profits of successful manage-
plines ment without having to share them with
other owners
D. (b) and (c) above.
A. Proprietorship
830. Of the following which is NOT a “fixed” B. Partnership
cost for a business?
C. Corporation
A. packaging
D. Franchise
B. security cameras
836. Who authored the book title, “ An inquiry
C. rent
into the nature & causes of wealth of na-
D. insurance payments ture.”
831. Distribution examines how income is di- A. Robbins
vided between B. Marshall
A. producers and resource owners. C. Samuelson
B. consumers and producers. D. Adam Smith
C. consumers and resource owners. 837. Entrepreneurs take risks to start and run
D. producers and economizers. A. economic resources
832. How many types of economies are B. opportunity costs
there? C. factors of prduction
A. 3 D. businesses
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 334
838. Which of the following would be an ex- D. Developed countries do not face Cen-
pansionary fiscal policy (increasing eco- tral Economic Problems
nomic growth)?
843. A nation’s transportation, communica-
A. lowering income tax tion, and utility systems.
B. raising the value of £ A. infrastructure
C. printing money B. privatization
D. lowering government expenditure C. factors of production
NARAYAN CHANGDER
(spending)
D. interstate commerce
839. What is the production possibilities
curve? 844. What do you mean by a mixed econ-
omy?
A. a graph that shows how much an econ-
omy can produce between 2 goods A. Modern and traditional industries
B. how much money something is B. Public and Private sectors
C. the opportunity one has to give up in C. Foreign and domestic investments
order to gain something else D. commercial and subsistence farming
D. land, labor, capital, entrepreneurs 845. In a market economy, who has the least
840. Which of the following are NOT capital influence over how economic resources are
factors of production? allocated?
A. Loan from the bank A. The government
B. Stock or produce B. Consumers
C. Factory building C. Businesses/Producers
D. Factory workers D. None of the above
841. Opportunity Cost is when 846. Which market structure did the DeBeers
Diamond industry fall under?
A. the total value of your options
A. Monopoly
B. the value of something gained when
you make a choice B. Oligopoly
C. the value of something given up when C. Perfect Competition
you make a choice of one thing over an- D. Monopolistic Competition
other
847. The GFC was caused by
D. the value of your hours at work
A. Consumer confidence was low due to
842. State which of the following statement is the war in Iraq
not true. B. Banks and other lenders were will-
A. If the recourses were unlimited, peo- ing to make increasingly large volumes of
ple would be able to satisfy their wants. risky loans
B. If recourse has only single use, then C. The American government was in debt
also economic problem would not arise. to the IMF and interest rates were in-
C. All countries, without exception, face creased significantly
problem of scarcity. D. Baked beans
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.5 Business Economics 335
848. a firm legally ceases to exist when an 853. This type of business is owned by one
owner dies, quits, or sells the business person.
PRACTICE BOOK» NOT FOR SALE
A. nonprofit organization A. Partnership
B. collective bargaining B. Sole Trader
C. Limited Company
C. credit union
D. Franchise
D. limited life
854. What does an entrepreneur do?
849. The value of the next-best alternative
A. start and run a business
that you were not able to choose.
B. take over a company
A. Capitalism
C. develop a course
B. Opportunity Cost
D. work at and manage a store
C. Consumer
855. The study of economic behavior of an indi-
D. Supply vidual firm or industry in national economy
is called as
850. Industry rivalry among companies of the
same or related industry is called A. Micro Economics
B. Macro Economics
A. Competition
C. Business Economics
B. Distribution
D. Behavioral Economics
C. Alliance
856. The measure of the aggregate price level
D. Threats of intermediate products and wholesale
goods
851. The term mixed economy denotes
A. 1. Consumer Price Index
A. Co-existence of consumer and pro-
ducer’s goods industries in an economy B. 2. Product Price Index
C. 3. Producer Price Index
B. Co-existence of private and public sec-
tor in an economy D. 4. Market Price Index
C. Co-existence of urban and reral sec- 857. Which market structure involves selling
tors in an economy identical products?
D. Co-existence of Large and small indus- A. Perfect Competition
tries in an economy B. Monopolistic Competition
852. Costs incurred by a business when man- C. Oligopoly
ufacturing a good or producing a service D. Monopoly
(including raw material and labor)
858. Capitalism refers to
A. Production Cost
A. The use of market
B. Opportunity Cost B. Government ownership of capital
C. Trade C. Private ownership of capital goods
D. Microeconomics D. Private ownership of homes and cars
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 336
859. Sara’s Hair Palace is a small, locally B. OLIGOPOLY
owned beauty salon in Sterling. Sara does C. FOREIGN SECTOR
all the work. This represents what type of
business? D. MONEY
A. corporation 861. The amount by which the quantity de-
B. partnership manded changes in relation to a change in
price.
C. sole proprietorship
A. Price elasticity of income
NARAYAN CHANGDER
D. none of above
B. Demand
860. TERM 3 TOPIC IN GR 11 C. Supply
A. MONOPOLY D. Price elasticity of demand
1.6 Business Finance
1. Many presentation software programs al- C. 31.25%
low users to: D. 33.3%
A. Publish web pages.
4. Corporation Tax is paid by?
B. Copyright their graphics.
A. partnerships
C. Include voice narration.
B. companies
D. Design organizational charts.
C. sole traders
2. What is the following statement a defini- D. individuals
tion of? ”A document issued by a bank on
behalf of a customer, authorising a person 5. Fill in the blank with the best answer:The
to draw money to a specified amount from process of funding a business venture is
its branches or correspondents, usually in called
another country, when the conditions set A. management
out in the document have been met.”
B. accounting
A. Bill of exchange
C. financing
B. Export guarantee
D. none of above
C. Banker’s draft
6. Specify a term financial actions and the an-
D. Letter of credit
ticipated impact of those actions
3. Refer to the data in the attached doc- A. Measurable plans
ument from Spice Co.Ltd (year ending B. Strategic plans
31/3/1c).Sales revenue $150 000Gross
profit $50 000Overhead expenses $35 C. Tactical plans
000Capital employed $200 000The gross D. Financial plans
profit margin was:
7. Is the setting of expenditure levels for
A. 13.3% each of an organization’s functions. It is
B. 30% the estimation and allocation of available
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 337
capital used to achieve the designated tar- 12. Happens at times when a firm has nothing
gets of a firm. to offer as collateral for a loan.
PRACTICE BOOK» NOT FOR SALE
A. Budgeting A. Long Term Financing
B. Cash Budgeting B. Short Term Financing
C. Marketing C. Inventory Financing
D. Banking Institutions D. Receivable Financing
8. This type of investment is provided by fi- 13. Which of the following is a reason why
nacial institutions, mostly banks. a new business start-up would need fi-
nance?
A. bonds
A. To fund expansion
B. deposit banks
B. to pay for replacement equipment
C. mutual funds
C. To carry out maintenance on a new
D. stocks piece of machinery
9. When a bank asks for ‘security’ before D. To pay a deposit for a premises
agreeing to a bank loan it means that: 14. An obligation granted by the creditors that
A. the offices must be securely locked at uses real estate or movable assets as col-
night lateral.
B. firm assets will be sold by the bank if A. Long Term Loan
the loan isn’t paid B. Term Loan
C. the assets purchased must be insured C. Mortgage Loan
D. A Loan (mag-isa)
D. none of above
15. A reason for poor cash flow is:
10. Which bank enjoys monopoly power of
A. A lack of demand from consumers for
Note issue?
the firm’s products
A. NABARD
B. Good business decision-making
B. Commercial Bank C. Reduced interest rates
C. Central Bank D. Increased sales revenue
D. none of above
16. Why do you need a business plan?
11. the study of the decisions that go into mak- A. To explain your idea
ing, distributing, and using goods and ser-
vices B. the ability to get financing.
C. it’s a road map that sets objectives and
A. economics
goals for the business.
B. scarcity
D. To help reduce the risk of business fail-
C. opportunity cost ure.
D. foreign exchange market E. All of the above.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 338
17. one of the three functions of money allow- C. it is protected by government
ing people to preserve value for future use
D. none of these
A. store of value
B. medium of exchange 23. What is a disadvantage of an overdraft?
C. unit of account A. It means you have no savings
D. cash B. It can lead to personal conflicts
18. business organization that operates as a C. It can take a long time to arrange
NARAYAN CHANGDER
legal entity that is separate from its own- D. They can be recalled immediately
ers and is treated by law as if it were an
individual person 24. is commenly used by business organi-
A. corporation sations as a source of short term financing
B. partnership A. Lease financing
C. franchise B. ADRs
D. limited liability company C. Trade credit
19. An increase in fixed costs will do which of D. None of these
the following
A. shift the break even point to the left 25. Which of the following is a drawback to a
business that issues debentures
B. make the total cost function steeper
A. Lenders do not have any voting rights
C. shift the breakeven point to the right
D. make the total cost function flatter B. There is dilution of control
C. There is a dilution of ownership
20. bond
A. a money return D. The value of liabilities increases
B. a borrow from a company 26. Having a positive tone, smiling, saying
C. a specific type of security that is sold please, thank you, and you’re welcome
by firm or government are all examples of
D. desire for something sweet A. Courtesy
21. A loan that has to be repaid immediately B. Compassion
is called an C. Character
A. Underdraft
D. Confidence
B. Overdraft
C. Oversight 27. Persons or institutions to whom money is
owed
D. Undercraft
A. Financial Institutions
22. why commercial papers can be issued only
by large and creditworthy companies? B. Interest
A. it is an unsecured debt C. Creditors
B. it is fully secured debt D. Collateral
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 339
28. Morgan is a newly hired Financial Manager 33. Expenses that a business is obligated to
his tasks is to evaluate how much money pay.
is needed in order to start up a new branch
PRACTICE BOOK» NOT FOR SALE
A. capital
of fast food chain. This activity falls under
? B. liabilities
C. assets
A. Capital Budgeting
D. retail price
B. Capital Structure
C. Capital Investment 34. Which of the following is NOT a core char-
acteristic of most entrepreneurs?
D. Working Capital
A. Risk-taker
29. The point at which a business is making B. Selfish
the same amount of money it is spending. C. Confident
A. capital D. Independent
B. asset 35. Joe wants to trade (buy and sell) curren-
C. profit cies which market did she needs to trans-
act.
D. break-even
A. Bond Market
30. In general, for a couple in their 50s with B. Commodities Market
grown-up children the key financial objec-
tive will be to maximise income C. Derivatives
D. Forex Trading
A. because their expenditure is so high
B. so they can save and invest for retire- 36. The key participants in financial transac-
ment tions are individuals, businesses, and gov-
ernments. Individuals are net of funds,
C. so they can launch their careers and businesses are net of funds. A. B.
D. so they can buy their first house C. D.
A. suppliers; users
31. In making an investment decision we have
to consider the optimal firm size. B. purchasers; sellers
C. users; providers
A. true
D. users; suppliers
B. false
C. maybe 37. Marites wants to start-up a Milk Tea Shop
near Baliwag Polytechnic College, In or-
D. all of the above der to have a starting Capital she bor-
row money from St. Augustine Coopera-
32. All are examples of financial instruments
tive with an Interest of 5%. This Fund is
except for one
known as?
A. Bonds A. Credit Finance
B. Stocks B. Equity Finance
C. Utility Bill C. Debt Finance
D. Loans D. Bank Finance
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 340
38. Which part of the Bank of England is re- 43. Which of the following is a type of saving
sponsible for the stability and resilience of and investment
the UK’s financial system as a whole? A. Credit Cards
A. Financial Conduct Authority B. Premium Bonds
B. Monetary Policy Committee C. Payday Loans
C. Financial Policy Committee D. Bit Coin
D. Prudential Regulation Authority 44. Debt Financing
NARAYAN CHANGDER
39. When a business has more expenses than A. Could be vulnerable to takeover
income from sales for a specific time pe- B. Investors will demand a share of prof-
riod, their P & L Statement would show its in the form of dividends
a(n): C. You do not have to give up part of your
A. Profit business in shares
B. Expense D. none of above
C. Loss 45. An act passed into law by Congress in
2002 to establish strict accounting and re-
D. Revenue
porting rules in order to make senior man-
40. Which are the internal source of finance agers more accountable and to improve
and maintain investor confidence.
A. Sales of inventories to reduce inven-
tory levels A. Sarbanes Oxley Act
B. Federal Reserve Act
B. Issue of shares
C. Dodd Frank Law
C. Bank loan
D. Gramm Leach Bliley Act
D. Selling Debentures
46. A common use of funds for businesses is
41. A is one financial intermediary han-
dling individual savings. It receives pre- A. revenue
mium payments that are placed in loans or
investments to accumulate funds to cover B. borrowing
future benefits. C. money frominvestors
A. life insurance company D. capital expenditures.
B. commercial bank 47. Businesses calculate break-even in units so
C. savings bank they know
A. how much profit they will earn after
D. credit union
they break even
42. An example of a current liability could be: B. which products they should purchase
A. Debtors for resale
C. which costs are variable and which are
B. Mortgage
fixed
C. Creditors
D. how many products they must sell to
D. none of above break even
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 341
48. Refers to the time it takes for the business C. The financial reporting section
to sell its finished product from the time it D. The treasury management section
purchased raw materials.
PRACTICE BOOK» NOT FOR SALE
A. Inventory Period 53. Some sources of finance are available to
both companies and households. Which of
B. Accounts Receivable Period the following is a source of finance avail-
C. Monthly Period able to companies only?
D. none of above A. Bank overdraft
B. Credit cards
49. Profit is important to businesses because:
C. Commercial paper
A. it improves businesses, cash balances
D. Hire purchase
B. it can be used to measure business
size 54. Which is not a function of money
C. it is a measure of businesses, success A. Legal Tender
D. businesses need to pay taxes to the B. Means of exchange
government C. Unit of account
50. why many small businesses do not use D. Measure of a commodity
budget
55. The buyer receives the invoices sent by the
A. budgeting is for large firms seller specifying the goods purchases, the
B. budgeting can be time consuming purchase price, the total amount to be paid,
and the terms of the purchase.
C. small business do not record vari-
ances A. Trade Credit
D. all of the above B. Accruals
C. Stretching of Payables
51. Which of the following sources of finance
is most likely to be used by a company D. Accounts Payable
planning to take over another business? 56. ‘An agreement made with a bank allow-
1) Bank overdraft 2) Leasing 3) Share is- ing a third party to withdraw money from
sue 4) Trade credit an account on a set day to pay for goods
A. and services each month’ describes which
method of payment
B.
A. Electronic Transfer
C.
B. Credit Card
D.
C. Direct Debit
52. Which section of a company’s finance func- D. Standing Order
tion has primary responsibility for ensur-
ing the sound stewardship by managers of 57. This refers to the value of the assets that
the resources entrusted to them? the customer has and plans to use to se-
A. The financial transactions recording cure the credit.
section A. Collateral
B. The management accounting section B. Capital
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 342
C. Character B. Credit Risk
D. Conditions C. Liquidity Risk
E. Capacity D. Operational Risk
58. In what category of bond issuers is issued 63. Which of the following is not a private eq-
by local government or state? uity fund in the Philippines.
A. agency bonds A. Sierra Madre
B. Investment & Capital Corporation in
NARAYAN CHANGDER
B. corporate debt securities
the Philippines Venture Partners
C. government securities
C. Kickstart PH
D. municipal bonds
D. Insular Life Assurance Company, Ltd.
59. It deals with managing the assets of the 64. the of a country is an important deter-
firm minant of
A. investing decisions A. saving rate & economic growth
B. financing decisions B. interest & monetary value
C. operating decisions C. strawberry short cake & value
D. declaration of dividends. D. blanky blank
60. is responsible in presenting or request- 65. Specify who will do it
ing budget for advertisement and promo- A. Assignable
tion of products.
B. Time-related
A. advertising manager
C. Measurable
B. marketing officer
D. Realistic
C. finance officer
66. a nationwide electronic stock index that
D. accounting supervisor links dealers across the nation so that they
can buy and sell stock electronically
61. A short-term source of finance from a
bank that usually is only used in an emer- A. NYSE
gency/when needed is called: B. NASDAQ
A. Overdraft C. Dow Jones
B. Loan D. S & P 500
C. Share capital 67. A participates in many kinds of bank-
D. Credit card ing activities and is both a commercial
bank and an investment bank as well as
62. Jessica wants to apply loan to WWW providing other financial services such as
Bank but before the bank could approved insurance.
Jessica’s loan, the bank manager asked
A. Commercial Bank
for personal information and extensive re-
quirements. This manager steps will help B. Universal Bank
the bank with? C. Thrift Bank
A. Market Risk D. Investment Bank
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 343
68. Which of the following is not a disadvan- 73. What are ‘ Development banks ‘ also
tage of a grant? know as?
PRACTICE BOOK» NOT FOR SALE
A. doesn’t need to be repaid A. Custodian
B. may not be awarded it B. Commercial Banks
C. need to meet criteria C. Depository
D. Financial instituions
D. not the largest amount of money
74. debts that companies owe (salaries,
69. a written outline of how the business will wages, loans, expenses)
get money to start up and operate, and
how the business will maintain financial A. liabilities
operations and business records B. operating cost
A. strategic plan C. shareholder
B. marketing plan D. bear market
C. financial plan 75. It deals with working capital management.
D. none of the above A. investing decisions
B. financing decisions
70. the total value of goods produced and ser-
C. operating decisions
vices provided in a country during one
year. D. declaration of dividends
A. consumer price index 76. what is the safest type of investment
B. gross price index A. government bond
C. gross domestic product B. saving account
D. consumer domestic product C. stock
D. firm
71. A t-shirt company spend $2.50 for every
shirt they produce. They charge customers 77. What is a variable cost?
$15.95 on Amazon.com. What is the cost A. Costs that increase directly with
per unit? changes in production or output.
A. $2.50 B. The costs directly involved in making
B. $15.95 one product.
C. Costs that remain the same regardless
C. $13.45
of how many items you make or sell.
D. $20.45 D. Costs other than those involved in mak-
ing the product.
72. It is the borrower’s ability to pay the loan.
A. character 78. A form of financing that allows the current
account holders to overdraw the account
B. capacity up to a specified limit.
C. collateral A. Bank Loan
D. condition B. Bank Deposit
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 344
C. Bank Account 83. shows how cash is used by a business
during a specified time period.
D. Bank overdraft
A. Future Value
79. Aimee has just received an unexpected bill,
B. Capital Budget
which source of finance would you sug-
gest? C. Income Statement
A. savings D. Cash Flow Statement
NARAYAN CHANGDER
B. retained profits 84. This refers to the customer’s track of
C. bank loan record of settling its obligation on time.
More often than not, customers without
D. bank overdraft a track record should not be given credit.
80. Case study:the Business Incubator team A. Collateral
‘TradeTools’-an online platform connecting B. Capital
neighbors who want to rent tools with
C. Character
neighbours that own them. They will pitch
their business concept in May-what would D. Conditions
be the most appropriate source of finance E. Capacity
for this new, untested idea?
85. average of a group of stock prices
A. Angel Investor
A. assets
B. Bank loan
B. quote
C. Personal savings
C. indexes
D. Credit cards
D. revenue
81. a measure based on the prices of the
86. Acid test ratio is a more severe test of liq-
stocks of 30 large companies, widely used
uidity because
as a barometer of the stock market’s
health A. It excludes costs
A. NASDAQ B. it excludes stock
B. S & P 500 C. it includes costs
C. Dow Jones D. it includes stock
D. NYSE 87. is being able to manage your calendar,
work, email, social media, and projects.
82. It is a financial intermediary handling in-
A. Professional management
dividual savings. It receives premium pay-
ments placed in loans or investments to ac- B. Resource management
cumulate funds to cover future benefits. C. Referral management
A. life insurance company D. Personal management
B. commercial bank
88. Which are advantages to Sale of non-
C. savings bank current assets?
D. credit union A. No cost to business
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 345
B. Non-current assets can be scrap metal its 100 top-selling products in its shops.
C. Lease charge increases Availability of these items is Raj plc’s:
PRACTICE BOOK» NOT FOR SALE
A. key performance indicator
D. It can raise money
B. core competence
89. When e-mailing large files or documents
C. target
to coworkers or customers, a business per-
son sends them: D. critical success factor
A. In codes. 94. When a bank asks for ‘security’ before
B. As attachments. agreeing to a bank loan it means that:1)
the offices must be securely locked at night
C. In text boxes. 2) business assets will be sold by the bank
D. As reply messages. if the loan is not repaid 3) the assets pur-
chased must be insured 4) the managers
90. A public limited company wants to take must provide an assurance that the loan
over a competitor. This will involve a will be repaid
large amount of finance. The best source
A.
is likely to be:
B.
A. an overdraft
C.
B. debt factoring
D.
C. taking on a new partner
D. a share issue 95. Operating ? is the company’s earn-
ings before interest and taxes.
91. financial planning is a process to ensure A. accounts
that
B. integrity
A. the cash of the company is positive
C. debt
B. the company is solvent
D. income
C. the resources are unlimited
E. solvency
D. the company is liquid and has paid all
investors dividents 96. It is the management of financial resources
of private individuals, non-governmental
92. Which is true about risk-return trade off? organizations, and private organizations
in accordance with the prescribed financial
A. An investor will never accept losses in
policy and priority of the person or busi-
an investment.
ness organizations.
B. The riskier the investment is, the more
A. Business Finance
an investor expects a high return of profit.
B. Private Finance
C. It is the concept of low-risk-high-
return C. Public Finance
D. all of the above D. Personal Finance
93. Raj plc operates supermarkets. The com- 97. Provides loans for individuals and compa-
pany has identified that it will outperform nies
its rivals if it always has inventory of A. financial institutions
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 346
B. businesses 103. Why prepare a cash budget?
C. financial markets A. calculate cost of sales
D. consumers B. highlight periods of a negative balance
C. calculate profit
98. Costs that change with output are known
D. none of above
as?
A. Fixed Costs 104. the currency code for the US Dollar
NARAYAN CHANGDER
B. Variable Costs A. USD
B. FRN
C. Total Costs
C. USN
D. Short Costs
D. USC
99. It is the borrower’s financial resources.
105. Which of the following is paid after tax:
A. capital A. Salary
B. character B. Interest
C. condition C. Dividend
D. collateral D. Commission
100. Cash Flow statement is 106. Which of the following is the correct for-
mula to calculate total sales revenue?
A. Money you entered and existed for a
certain amount of time A. Selling price per unit x output sold
B. Total fixed costs + total variable costs
B. Financial Investments
C. Unit cost x output
C. Assets
D. Total inflows -total outflows
D. Liabilities
107. Commercial banks earn money in all of
101. Which of the following is not a limita- the following ways EXCEPT:
tion of Commercial Banks as a source of A. Investing in other companies
finance?
B. Charging fees for their services
A. Funds are generally available for short
C. Collecting interest on loans
periods
D. Taking a percentage off of all deposits
B. Procedure of obtaining funds slightly
difficult 108. Disadvantage of issuing of share as a
C. Charge on assets source of finance is
A. permanent source of capital as it will
D. Complex procedure
not need to be redeemed
102. The term’ redeemable’ is used for B. debt capital
A. preference shares C. Cost of interest rate
B. Equity Shares D. The ownership of the company in case
of public limited companies may be diluted
C. commercial paper or change hands from the original share-
D. public deposits holders.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 347
109. On an income statement, which of the fol- C. Trade Credit
lowing is another name for an overhead? D. none of these
PRACTICE BOOK» NOT FOR SALE
A. Outflow
115. He is the one who supervises the com-
B. Receipt pany’s operation and ensuring that the
C. Expense strategies are well executed and planned.
D. Payment A. finance manager
110. a written outline of how the business will B. president
be promoted to increase customers and C. marketing manager
sales
D. shareholders
A. strategic plan
116. which of the following is not a benefit of
B. marketing plan
budgeting
C. financial plan
A. it is a source of motivation
D. none of the above
B. it is a means of coordinating business
111. By definition, the money market involves activities
the buying and selling of. C. it prevents company to incur losses
A. funds that mature in more than one D. it promotes study, research, and focus
year. on the future
B. flows of funds
117. Which is an example of Revenue expen-
C. stocks and bonds. diture
D. short-term funds. A. Motor Van
112. Funds required for purchasing current as- B. Gym equipment
sets is an example of C. Salary
A. Fixed capital requirement D. Premises
B. Ploughing back of profits
118. what is productivity
C. Working capital requirement
A. the amount of things you get done in a
D. Lease financing set time
113. What technology allows businesses to B. amount and value of goods and ser-
present their financial information in a vices produced (outputs) from set amount
meeting? of resources
A. email C. the cost of making goods and services
B. database D. countries overall income
C. word processing 119. A company decision to purchase new de-
D. powerpoint livery trucks resulted in the need to build
a new loading dock to handle the different
114. is an example of short term finance. design of the vehicles. This situation is an
A. shares example of
B. Debentures A. independent projects
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 348
B. complementary projects 125. In this working capital financing policy,
C. mutually exclusive projects some of the permanent working capital
requirements are financed by short-term
D. unnecessary projects sources of financing.
120. Interest payments that are based on the A. maturity-matching
original principal and previous interest rec- B. conservative
ognized are based on
C. aggressive
A. present value
NARAYAN CHANGDER
D. moderate
B. future value
C. simple interest rate 126. Which of the following statements about
venture capital is most valid?
D. compound interest rate
A. Venture capital is a low risk and low
121. a person who invests in a corporation by return form of finance
buying stock and is a partial owner B. Companies listed on major stock ex-
A. quote changes normally use venture capital to
B. shares raise new finance
C. stock broker C. Venture capital can be appropriate for
a management buyout
D. shareholder
D. Venture capital normally takes the
122. The amount of debt and equity used by a form of debt finance
firm to finance its operations is called the
firm’s: 127. The closing bank balance is calculated by:
A. debt ratio. A. opening bank balance + cash out-flow
B. working capital ratio. B. opening bank balance + cash in-flow
C. capital structure. C. opening bank balance + net cash flow
D. financial position. D. net cash flow + gross profit.
123. a system for buying and selling shares of 128. Father of Modern Economics
companies A. Adam Smith
A. NYSE B. Alan Greenspan
B. stock market C. Alan Smith
C. shares D. Adam Greenspan
D. indexes
129. The business will pay less tax on its prof-
124. The financial needs of a business can be its
categorised into categories. A. To fund expansion
A. 4 B. To pay for replacement equipment
B. 2 C. To carry out maintenance on a new
C. 6 piece of machinery
D. 3 D. To pay a deposit for a premises
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 349
130. A occurrence is ongoing and happens C. Principal
every three months.
D. Interest
PRACTICE BOOK» NOT FOR SALE
A. Quarterly
B. Semi-annually 136. Cost of sales is the same as:
C. Annually A. Fixed costs
D. Frequency B. variable costs
131. Which is not a type of insurance C. total costs
A. Health D. average costs
B. Home and contents 137. What do we call a fee that is collected for
C. Pet using someone’s money?
D. Job A. Deposit
132. It contains the name of business, busi- B. Interest
ness location, address and nature of the C. Loan
business.
D. Check
A. Personal background
B. General Description of the Business 138. Which of these is a liability?
C. Market Plan A. Cash in bank
D. Financial Plan B. Money owed to other business (credi-
tors)
133. a business owned by two or more people
A. sole proprietorship C. Stock
B. franchise D. Machinery
C. cooperative 139. Socialism, the opposite of capitalism, is
D. partnership typical of what type of economic system?
134. ‘Convenient as can be used at any time A. Command
and place’ is an advantage of which B. Traditional
method of payment
C. Market
A. Store Card
D. Mixed
B. Contactless Card
C. Mobile Banking 140. Any person who brings together
providers and users of finance, whether
D. Pre-paid Card
as broker or principal, is known as
135. Douglas used the title on his car to secure A. a business angel
a loan from XYZ Bank. The car was used
as: B. a venture capitalist
A. Creditor C. a merchant banker
B. Collateral D. a financial intermediary
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 350
141. What is a non profit financial cooperative 146. A business has applied for a bank loan
owned by its members that provides credit to buy new computers. A bank manager is
and other financial services? most likely to ask all of the following ques-
A. Schools tions before granting the loan except:1)
How big is the loan needed? 2) How many
B. Credit Unions loans has the business already obtained?
C. Banks 3) How long will the loan be needed for?
4) How powerful are the computers?
D. Insurance
NARAYAN CHANGDER
A.
142. ‘An agreement made with a bank to
transfer a fixed sum of money to a third B.
part account on a set date and regular ba- C.
sis’ describes which method of payment
D.
A. Electronic Transfer
147. Which of the following is an advantage
B. Credit Card
to the shareholders of a company that is
C. Direct Debit obtaining a listing on the London Stock Ex-
D. Standing Order change?
A. Disclosure requirements are reduced
143. The accounting procedure that recognizes
revenues and expenses when they are in- B. Larger dividends can be paid
curred rather than when cash is received C. Shares become more readily mar-
or spent is known as ? accounting. ketable
A. accounts D. The company becomes entitled to put
B. integrity ‘plc’ (public limited company) after its
C. debt name
D. accrual 148. All are key concepts of the definition of
E. solvency finance except for one
A. Both a science and an art both a sci-
144. The value of an investment after one or ence and an art
more periods of time is called the:
B. Application of economic and account-
A. simple value.
ing concepts and principles
B. present value
C. Buying and selling of goods
C. discounted value.
D. Management, allocation, and utiliza-
D. future value. tion
145. Which of the following is NOT the at- 149. What is the fourth step in the accounting
tribute of a competent manager? cycle?
A. Visionary A. A trial balance of the accounts is pre-
B. Decisive pared
C. Respected B. Closing entries are completed
D. Inability C. Adjusting entries are recorded
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 351
D. Journal entries are posted in the ap- 154. What is a disadvantage of using owners’
propriate accounts funds?
PRACTICE BOOK» NOT FOR SALE
E. Financial statements are prepared A. It means you have no savings
150. Which of the following statements best B. It can lead to personal conflicts
describes an internal source of finance? C. It can take a long time to arrange
A. Finance generated from outside of the D. They can be recalled immediately
business
155. Jeremy is hired as a new financial man-
B. Finance generated from inside the ager, he focuses on updating monthly up-
business date with the financial aspect of the com-
C. Finance generated from retained pany to the investors and board of direc-
profit only tors. This objective means?
D. Finance generated from a new share A. Strong Relationship
issue B. Manage Relationships
151. This refers to the general global and C. Growing Relationship
home country macroeconomic conditions D. Developing Relationship
and the industry-specific conditions.
156. A tax on imported goods
A. Collateral
A. tariff
B. Capital
B. embargo
C. Character
C. quota
D. Conditions
D. none of the above
E. Capacity
157. the f ormula (1 + i)n is also called
152. An individual or an organisation that
A. present value factor for lump-sum pay-
owes a business money is called a:
ment
A. Payable
B. future value factor for lump-sum pay-
B. Receivable ment
C. Creditor C. present value factor for ordinary annu-
D. Debtor ity
D. future value factor for ordinary annu-
153. A consultant has stated that a 30-year
ity
Treasury bond issued in the last year can
be sold in four different categories of mar- 158. An established seasonal business is ex-
ket.1 The money market2 The capital mar- periencing cash flow problems during the
ket3 The primary market4 The secondary winter months. Which of the following
marketWhich of these markets are avail- would be a suitable source of finance to
able for the sale? overcome this problem?
A. 1 and 3 only A. New share issue
B. 1 and 4 only B. Government grant
C. 2 and 3 only C. Overdraft
D. 2 and 4 only D. Hire purchase
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 352
159. It sets the company’s direction. C. Both A and B
A. short-term goal D. None of the above
B. long-term goal
165. what is budgeting?
C. mid-term goal
A. having enough money to buy some-
D. none of the above thing
160. sources of funds can be categorised as: B. having money leftover at the end of the
NARAYAN CHANGDER
A. period basis month
B. source of generation basis C. having the ability to pay bills
C. ownership basis D. a plan in advance regarding the ex-
penditure of money based on available in-
D. all of these
come
161. The process of accumulating interest in an
investment over time to earn more inter- 166. ‘Often only accepted for relatively small
est is called: transactions’ is a disadvantage of which
method of payment?
A. discounting.
A. Pre-paid Card
B. compounding.
B. Store Card
C. complexing.
C. Contactless Card
D. indexing.
D. Charge Card
162. Identify the limitations of financial insti-
tutions. 167. If revenue were to increase, yet variable
A. Follow rigid criteria for grant of loans and fixed costs were to remain the same.
What would be in the impact on the break
B. No tax saving even point?
C. No assured return for the lender A. Break Even Point Increases
D. Restrictions may be imposed
B. Break Even Point Decreases
E. Complex procedure
C. Break Even Point Remains the Same
163. Which one of the following is not a fea- D. none of above
ture of debentures?
A. Specified maturity period 168. Diane wants to start-up a money changer
business but before she starts she first
B. No voting right
test if its going to be a profitable business.
C. Long term debt instruments So, she simultaneously buys and sells dol-
D. Variable return lars in different dates and rates. This ac-
tivity is known as?
164. Which statement is true about risks?
A. Spot
A. Risks are present in all types of invest-
B. Outright Forwards
ment
C. Currency Swap
B. An investor can select investments
with minimum risks? D. Currency Buying
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 353
169. Which of the following is an example of C. an unchanged share price
variable costs? D. an undetermined share price
PRACTICE BOOK» NOT FOR SALE
A. rent
175. The President requested to lower the tax
B. loan repayments percentage by 3% to increase the tax col-
C. salaries lection in order to have an additional Na-
tional Budget. This activity is known as?
D. electricity
A. Government Finance
170. Which type of innovation occurs when the
B. National Finance
new product is released to the public?
C. Domestic Finance
A. Paradigm
D. Public Finance
B. Position
C. Product 176. Who pays interest on a loan
D. Process A. a lender
B. a borrower
171. In this type of investment, the company
pools money from many investors and in- C. a credit union
vests the money in securities. D. a creditor
A. bonds
177. In making an assets management de-
B. deposit banks cision we have to consider current as-
C. mutual fund sets management than fixed current as-
sets management.
D. stocks
A. true
172. Which type of borrowing has the highest B. false
interest rate?
C. maybe
A. Loan
D. none of the above
B. Overdraft
178. These channel the savings of individuals,
C. Mortgage
businesses, and governments into loans or
D. Payday Loan investments.
173. A business with no profit is A. financial market
A. A hobby B. financial institutions
B. An investment C. money market
C. Success D. Financial Instrument
D. Assets 179. Allocation of the government income gen-
erated from either taxation or borrowings
174. Cash flow and risk are the key determi-
nants in share price. Increased risk, other A. Financial investment
things remaining the same, results in B. Financial expenditures
A. a lower share price C. Private finance
B. a higher share price D. Public finance
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 354
180. Case study:Apple plans to develop a pro- 185. The Solar Software Company has decided
totype for an iPhones with a flexible dis- to build a new, on-site day care center to
play. Which of the following sources of improve employee morale and productiv-
finance would be most appropriate? ity. This project would MOST likely be cat-
egorized as which type of capital project?
A. Retained profits
A. social benefit
B. Selling shares
B. replacement
C. Crowdfunding
NARAYAN CHANGDER
C. government required
D. Bank loan
D. cost savings
181. if the government spend more money ,
186. What items are found on a balance
a budget deficit resualt
sheet?
A. than it collects
A. Accounts payable
B. earns B. Assets in inventory
C. spends C. List of owners and their qualifications
D. decides D. The media plan
182. Which of the following forms of new E. Stockholder or Owners Equity
share issues would normally be underwrit- 187. Gary was promoted as a new manager
ten? for ZYX Company, majority of his task
A. Introduction deals with how his company will get addi-
tional funding and how much dividend will
B. Offer for sale by tender
be distributed. This activity is known as?
C. Placing
A. Corporate Finance
D. Rights issue B. Company Finance
183. Cash Flow is your overall C. Organizational Finance
A. Money D. Business Finance
B. Movement of funds, through your busi- 188. Take some envelopes, write the budget
ness each month categories on the envelopes, and use only
that money to purchase those items
C. Decline of a capital asset
A. Irregular Income
D. Financial reports
B. The envelope system
184. one of the three functions of money C. Trade-off
allowing people to exchange money for
goods or services D. none of above
A. store of value 189. Which of the following is the source of fi-
nance which a company can draw on most
B. medium of exchange
easily in practice?
C. unit of account
A. Cash generated from retained earn-
D. cash ings
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 355
B. New share issues 195. is an asset promised by a business
C. Rights issues to a creditor if repayment of a loan isn’t
completed.
PRACTICE BOOK» NOT FOR SALE
D. Bank borrowings
A. Depreciation
190. what is the purpose of budgeting
B. Capital Budget
A. estimating income and expenses
C. Collateral
B. saving for future expenses
D. Time Value
C. increasing income
D. helping spend wisely 196. What do businesses often develop to be
able to store and analyze data for the sole
191. A recruitment agency floats itself on the purpose of making business decisions?
stock market. This means that
A. Survey methods
A. It borrows money from the stock mar-
ket B. Operating procedures
B. It recruits workers from the stock ex- C. Information systems
change
D. Management policies
C. Its sales increase
D. Its share are available to buy on the 197. Capital are
stock market A. economic value
192. It is composed of the variable and fixed B. decline of a capital asset
costs needed to run the operations of the
C. Financial Assets needed for a business
business
to produce the good and services it offers
A. sales revenue
D. Company total liabilities from its total
B. operating budget assets
C. production budget
198. Word processing would be likely used to
D. cash receipts
193. Trade payables is a suitable source of fi- A. create a businesses annual reports
nance to fund the purchase of what?
B. create income statements
A. inventories
C. create charts and graphs
B. a new delivery vehicle
C. property D. store customer information
D. direct labour 199. What is the capital needed to finance
the day-to-day running expenses and pay
194. To provide income and achieve growth for
short-term debts of a business?
business
A. Financial investment A. Working capital
B. Financial expenditures B. Non-current assets
C. Private finance C. Start-up capital
D. Public finance D. Current assets
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 356
200. Deal with choosing small and large 205. Which of the following sources of finance
projects with several investment opportu- to companies is the most widely used in
nities such ad cash flows and return invest- practice?
ment
A. Bank borrowings
A. Financial desicion
B. Rights issues
B. Investment decision
C. New share issues
C. Capital market
D. Retained earnings
NARAYAN CHANGDER
D. Business finance
206. What is a business description?
201. What is NOT a source of Internal fi-
nance? A. Something that describes what your
business does and what its about
A. Retained profit
B. The same as a business plan
B. Sale of existing assets
C. Theres no such thing
C. Issue of shares
D. none of above
D. All are sources of Internal finance
207. A merger between two or more compa-
202. What is the formula for closing balance?
nies in the same type of business is called
A. Fixed costs + Variable costs a
B. Variable costs per unit x Quantity A. joint venture
C. Opening balance +/-Profit/loss B. horizontal integration
D. Cash inflows-Cash outflows C. friendly takeover
203. Adventurous plc has recently sent goods D. vertical integration
to its first non UK customers but has taken
out insurance because it is worried about 208. Fill in the blank with the best answer:A
the possibility of payment default. what ratio that refers to how long the com-
types of risk does such a non-payment rep- pany’s money is “tied up” between pur-
resent? chasing raw materials and receiving cash
for selling products is
A. Physical risk
A. equity financing
B. Credit risk
B. stock
C. Trade risk
C. the cash conversion cycle
D. Liquidity risk
D. none of above
204. The key measure of inflation-the change
in the cost of buying a fixed basket of 209. The effective use of all the things avail-
goods and services. able to your business is known as
A. gross domestic product A. Business management
B. consumer price index B. Financial management
C. consumer domestic index C. Personal management
D. gross price product D. Resource management
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 357
210. The amount paid for the privilege of bor- 215. Which profit is the largest one that a busi-
rowing money. ness will make?
PRACTICE BOOK» NOT FOR SALE
A. Collateral A. Net Profit
B. Interest B. Gross Profit
C. Principal C. Full Profit
D. Creditor D. Formula Profit
211. Which of the following is an example of 216. Criteria businesses should use to decide
an institutional investor? when to offer credit include all of the fol-
lowing except offering credit
A. The Bank of England
A. to specific categories of customers
B. The Financial Reporting Council
B. for specific types of products
C. The Financial Conduct Authority
C. during specific times of the year
D. A unit trust
D. only in specific areas of the country.
212. It is the allocation of scarce resources ac-
cording to an economist’s perspective is 217. What is the definition of Revenue?
called A. Income from the sales of goods and
A. Division of profits and losses services
B. Arbitrary ratio B. Income from the cost of goods and ser-
vices
C. Finance
C. The money made on products
D. asset allocation
D. Cash coming into the business
213. What is the formula for Profit/loss?
218. Making posters and commercials are ex-
A. opening balance +/-profit/loss amples of:
B. Total revenue-Total Costs A. finances
C. Variable costs per unit x Quantity B. manufacturing
D. Fixed costs + Variable costs C. design
D. marketing
214. An advantage that an overdraft has over
a bank loan is that:1) it has a fixed rate of 219. What is a marketing plan?
interest 2) it is paid back over a fixed time
period 3) no dividends have to be paid to A. the same as a financial plan
shareholders as with a loan 4) the size of B. A plan that shows how your business
the overdraft can vary with the needs of will be advertised and or financially ran
the business
C. doesn’t exist
A.
D. none of above
B.
220. Which will NOT be considered by a firm
C.
before deciding on a suitable source of fi-
D. nance to use?
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 358
A. the purpose of the finance-what it will C. Operations
be used for D. People
B. how long the finance is used for
226. A primary financial market is one that:
C. the rate of interest on loans
A. involves the sale of existing securities.
D. the views of the workers
B. offers securities with the highest ex-
221. Describe the role of the Financial Ombuds- pected return.
man Service C. offers the greatest choice of shares
NARAYAN CHANGDER
A. Help settle disputes between con- and debentures.
sumers D. involves the sale of securities for the
B. Help guide your finance first time.
C. Help organise your money 227. a written outline of business goals and
D. none of above the steps to take to achieve them
A. strategic plan
222. A business owned by a several individu-
als who have limited liability for its debt B. marketing plan
is called a: C. financial plan
A. corporation. D. none of the above
B. sole proprietorship. 228. Tom invest in Axie for Php. 50, 000
C. general partnership. and losses because the SLP falls down fron
Php.5 to .05centavos. The risk that Tom
D. limited liability company
goes through in this investment is an ex-
223. An amount of money that is paid back ample of?
within an agreed amount of time, with in- A. Market Risk
terest
B. Credit Risk
A. Bank loan
C. Liquidity Risk
B. Angel investment D. Operational Risk
C. Overdraft
229. What is an advantage of an overdraft?
D. Retained profit
A. There is never interest
224. Which of the following is NOT a charac- B. You can pay in smaller installments
teristic of a strong work ethic?
C. Useful for relatively small sums and
A. Dependability short term finance required quickly
B. Professionalism D. You don’t have to pay it back
C. Tardiness
230. It is the time to collect cash from the sale
D. Dedication of the inventory.
225. What is known as the lifeblood of busi- A. days of inventory
ness? B. days of payable
A. Finance C. days of receivable
B. Marketing D. none of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 359
231. It arises when a business is valued at or B. copyrights
sold for more than the balance-sheet value C. books
of its assets.
PRACTICE BOOK» NOT FOR SALE
D. all are intellectual propert
A. High-quality profit
B. Share of capital 237. To which of the following businesses
might a supplier be reluctant to issue trade
C. Goodwill
credit?
D. none of above
A. A new business start-up
232. A good way of raising cash from capital B. A successful franchise
that may be tied up in assets that are not
C. A well-established and reputable out-
being used. which type of source of fi-
sourcing partner
nance
D. A highly profitable public limited com-
A. bank loan
pany
B. hire purchage
238. A business expects its rent to increase.
C. leasing
This would mean:
D. Sales of exiting assets
A. The break-even point would rise
233. Banks control the money supply by B. The break-even point would fall
A. restricting the amount of money in cir- C. The break-even point would stay the
culation same
B. lending D. The business would need to sell less
C. borrowing units to break-even
D. printing more money 239. A decline in the value of an asset as it
234. Which type of insurance is a legal require- ages is known as
ment? A. devaluation
A. Car B. depreciation
B. Travel C. recission
C. Pet D. a bummer
D. Home
240. Which of the following is not a fixed cap-
235. financing business across geographical ital requirement:
frontiers A. Purchase of Machinery
A. foreign exchange market B. Purchase of Machinery
B. federal reserve C. Purchase of Raw Material
C. international business finance D. Purchase of Furniture
D. bank loans
241. Are unsecured short-term deposits
236. Which of the following would NOT be con- made by a company with another com-
sidered intellectual property? pany.
A. patents A. Inter Corporate Deposits
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 360
B. Fixed Deposits 247. It provides the estimated amount of
C. Public Deposits money based on the volume of products
that a company proposes to sell in a future
D. Corporate Deposits period.
242. ROCE will be used by? A. cash disbursement
A. shareholders B. sales budget
B. potential investors C. cash receipts
NARAYAN CHANGDER
D. target cash balance
C. managers
D. all of the above 248. It is sub-category of private finance
which is directed towards the management
243. The horizontal line on the break-even of personal resources of an individual.
chart which is drawn parallel to the x axis A. Business Finance
is called the:
B. Private Finance
A. Fixed cost line
C. Public Finance
B. Variable cost line
D. Personal Finance
C. Total cost line
249. Bills of Exchange is an instrument of:
D. Total revenue line
A. ICD
244. The primary goal of the financial manager B. Trade Credit
is
C. Loan
A. minimizing return
D. None of the above
B. maximizing wealth
250. Which of the following facts about crowd-
C. maximizing profit
sourcing is/are TRUE? (choose as many as
D. minimizing risk apply!)
245. Businesses evaluate the quality and A. It is a method of internal fund raising
source of the information they obtain to B. Can also be an excellent marketing
make sure the information is: tool for a business
A. Random C. It doesn’t matter if the product
launched is not successful
B. Scientific
D. Great way of raising money quickly,
C. Technical
esp. for a new business idea
D. Useful
251. In this working capital financing policy,
246. The ease with which an investment can the permanent working capital require-
be turned into cash is? ments should be financed by long-term
sources while temporary working capital
A. Solvency
requirements should be financed by short-
B. Exchange Rate term sources of financing.
C. Risk A. maturity-matching
D. Liquidity B. conservative
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 361
C. aggressive D. costs, revenue and profit at different
D. modern levels of output
PRACTICE BOOK» NOT FOR SALE
257. Which of the following is an example of
252. Fill in the blank with the best answer:The
an internal source of finance?
money the business owes is referred to as
A. Selling unwanted assets
A. accounts payable B. Issuing new shares
B. accounts receivable C. Hire purchase
C. assets and liabilities D. Loan from family and friends
D. none of above 258. Firms that require funds from external
sources can obtain them from
253. What period of time does a balance sheet
A. financial markets
cover?
B. private placement
A. One quarter
C. financial institutions
B. One moment in time
D. All of the above
C. One year
D. One tax year 259. John says that his job duties include plan-
ning what will be done, organizing and di-
254. Which of the statements about retained recting workers, and solving problems re-
profits is false? lated to worker productivity. His job can
A. You have unlimited amounts of money be best described as a:
available A. Manager
B. Shareholders and employees could be B. Broker
frustrated because there is less profit to C. Cashier
be ‘shared out’
D. Bookkeeper
C. You do not have to pay interest
260. In many financial decisions, identifying
D. You are free to use it for any purpose
andevaluating risk is difficult
255. A business has made a net profit if; A. Financial planning information
A. All Costs are greater than Revenue sources
B. Revenue is greater than All Costs B. Consequences of choices
C. Evaluating risk
C. Revenue is greater than Cost of Sales
D. Evaluate alternatives
D. Cost of Sales is greater than Revenue
261. advantage of sale of assets as a source
256. A break even chart does not show
of finance
what?
A. This source of finance is not available
A. the margin of safety for a newly formed businesses and un-
B. how much output a business has to profitable and under profitable firms.
produce to break even B. A good way of raising cash from capi-
C. how much money a business will make tal that may be tied up in building that are
at the break even point not being used
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 362
C. Must be repaid 267. These funds are available for short time.
D. Reduces storage cost of high inventory A. money market debt
B. insurance
262. In which life stage may a student loan be
most important? C. long-term debt
A. Childhood D. mutual funds
B. Adolescence 268. What is the capital needed by an en-
trepreneur when first starting a busi-
NARAYAN CHANGDER
C. Young Adult
ness?
D. Middle Age A. Start-up capital
263. How a company will make customers B. Working capital
aware of its products/services? C. Bank loan
A. Marketing Plan D. Retained profits
B. Industry Overview 269. Which of the following is not a function
C. Product and Service Plan of a bank?
D. Growth Plan A. Safeguard
B. Create
264. Which is not a feature of a current ac-
count C. Exchange
D. Lend
A. An overdraft limit
B. Rate of interest paid on positive bal- 270. State the advantage of Owners savings
ances A. No interest is paid
C. Standing orders automatically created B. This makes better use of the capital
tied up in the business
D. Charges on unauthorised overdrafts
C. Permanent source
265. What type of budgets refers to the vari- D. none of above
able and fixed costs needed to run the
operations of the company but are not 271. Which of the following is not categorised
directly attributable to the generation of as Current Asset in a Balance Sheet?
sales? A. Inventories
A. Financial Budget B. Bank Balances
B. Operation Budget C. Plants and Machinery
C. Production Budget D. Trade Debtors
D. Sales Budget 272. Though banks have started extending
loans for Periods, generally such loans
266. ADRs stands for-? are used for Periods.
A. American Domestic Receipts A. long, short
B. American Direct Receipts B. long, medium
C. American Depository Receipts C. short, long
D. American Domestic Revenue D. medium, short
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 363
273. a contractual agreement to sell a com- company to raise funds from the Indian se-
pany’s products or services in a designated curities market.
geographic area
PRACTICE BOOK» NOT FOR SALE
A. Indian Depository Receipt
A. corporation B. American Depository Receipt
B. limited liability company C. Foreign Depository Receipt
C. franchise D. European Depository Receipt
D. partnership
279. Which source of finance below would
274. Mainly used for transactions to finance best be described as loan capital?
the shipment and handling of merchandise A. Ordinary share capital
between the exporter and importer.
B. Equity finance
A. Banker’s Acceptances C. Debt factoring
B. Commercial Papers D. Debentures
C. Commercial Finance company loans
280. Ahmed wants to open another branch
D. Short Term Bank Loans of his smoothie store. What is the best
source of finance for this case?
275. Which of the following sources of finance
does not have interest added. A. Trade credit
A. Overdraft B. Overdraft
B. Owners’ Capital C. bank loan
C. Mortgage D. leasing
D. Bank Loan 281. ? financing is the use of borrowed
money to obtain needed assets.
276. Which of the following is not a benefit of
A. integrity
using spreadsheets?
B. solvency
A. calculations automatically done for
you C. debt
B. replicate cells D. income
C. save and edit later 282. It is an area of finance that focuses on
D. software can be expensive the handling and management of financial
resources of a business organization.
277. The part of capital raised from owners of A. Business Finance
the company is known as:
B. Private Finance
A. Retained Earnings
C. Public Finance
B. Bond
D. Personal Finance
C. Share
283. Shares which have a fixed rate of return
D. Debenture
but have the option of participating in prof-
278. Is a financial instrument created by its.
an Indian Depository to enable a foreign A. Debentures
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 364
B. Equity share B. The asset will no longer be available to
C. Participating preference share use in the business
D. Convertible preference share C. Interest will be payable on the amount
raised
284. Short-term assets and short-term liabili- D. The bank will demand security
ties are referred to as the firm’s:
A. cash flow. 289. Resource management refers to the effec-
tive use of what item for business?
NARAYAN CHANGDER
B. capital budget.
A. Equipement
C. capital structure
B. Product
D. working capital.
C. Money
285. Preference shares have some characteris- D. All of these
tics of both And debentures
A. Equity shares 290. If a business’s costs exceeds it sales rev-
enue, it will experience a ?
B. Prefrence shareholders
A. loan
C. Debentureholder
B. profit
D. None of these
C. loss
286. Tram plc’s finance function must provide D. debt
information to management on the com-
pany’s balanced scorecard. This role is un- 291. What is a vision statement?
dertaken as part of Tram plc’s A. Something that helps your vision
A. statutory audit requirement B. Something that allows you to know
B. financial reporting function what the main goal of your business is
C. treasury management process C. the same as a business plan
D. performance measurement system D. none of above
287. It is designed to ensure that a company 292. Formal operation of Bangko Sentral ng
operates efficiently by monitoring and us- Pilipinas.
ing its current assets and liabilities to the A. July 5, 1993
best effect.
B. July 5, 1992
A. working capital management
C. July 3, 1993
B. inventory management
D. July 3, 1992
C. cash management
D. receivable management 293. Handling and management of financial re-
sources pf a business organization
288. Which of the following is a disadvantage A. Operating decisions
to a business of selling unwanted assets
to raise business finance? B. Financial investment
A. A business plan will need to be pro- C. Financial management
duced D. Business finance
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 365
294. Which is not a type of borrowing C. Medium-term finance
A. Mortgage D. Long-term finance
PRACTICE BOOK» NOT FOR SALE
B. Debit Card 300. Who started Microsoft when he was 23
C. Payday Loan years old?
D. Credit Card A. Steve Jobs
B. Bill Gates
295. Which is NOT a function of commercial
bank? C. Mark Zuckerberg
A. Providing financial and tax planning ad- D. Warren Buffet
vice
301. Business decisions about the value and
B. Print money price of stocks, bonds, portfolio, analysis
C. Providing insurance A. Personal finance
D. Exchanging foreign currencies B. Financial investment
296. Which of the following is not a feasible C. Financial decision
source of finance for an ordinary partner- D. Personal finance
ship?
302. ‘A system that allows the transfer of
A. bank loans payments directly from one bank account
B. Sale and leaseback to another’ describes which method of
C. Debt factoring payment
D. Initial public offering A. Mobile Banking
B. BACS
297. Who license Commercial Banks?
C. Store Card
A. government
D. Contactless Card
B. Central Banks
303. are equity linked debt securities that
C. they don’t need license
are to be converted into equity or deposi-
D. they bring their own tory receipts after a specific period.
298. Which of the following is the most suit- A. Foreign currency convertible bonds
able reason for using personal finance? B. American Depository Receipt
A. Insufficient internal sources of finance C. Foreign Depository Receipt
B. Insufficient external sources of fi- D. European Depository Receipt
nance
304. Moody plc is reviewing its internal con-
C. There is no interest obligation
trol system. Its control activities should
D. To please the owners (shareholders) be directed at controlling:
of a company A. threats to its operations
299. Which type of finance should be used to B. its operations
fund an increase in inventory? C. threats to achievement of its objec-
A. Immediate finance tives
B. Short-term finance D. achievement of its objectives
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 366
305. A successful plc is looking to expand into 310. Financial resources of private individuals
new markets whilst minimising the risk of or government agencies
takeover. Which of the following sources
A. Financial investment
of finance would be the most suitable to
fund this expansion? B. Financial expenditures
A. Hire purchase C. Private finance
B. Loan from family and friends D. Public finance
NARAYAN CHANGDER
C. Retained profit 311. He is one of the people involved in fi-
D. New share issue nancial management wherein he is tasked
to show how the hiring of additional man-
306. Which change provides the most time util- power will help with productivity is called
ity for a consumer?
A. Staying open for business on the week- A. Personnel officer
end.
B. human resource manager
B. Arriving at a product trade show early.
C. general manager
C. Shopping for a product in the morning.
D. accounting supervisor
D. Asking for early delivery of a product.
312. business contributions to the community
307. Bangko Sentral ng Pilipinas was created
through the actions of the business itself
under section 2, RA to supervise and
rather than donations of money and time
regulates banking and other financial insti-
tutions. A. corporate responsibility
A. RA 7653 B. corporate governance
B. RA 7652 C. corporate bylaws
C. RA 7553 D. articles of incorporation
D. RA 7625 313. a licensed professional who buys and
308. It is a document which the borrower sells stock exchange on behalf of clients
gives to the lending institution in exchange A. shareholder
for the money he borrowed is called
B. stock broker
A. gift certificate
C. Dow Jones
B. check
D. shares
C. collateral
D. promissory note 314. What is an advantage of a business using
owner’s capital as a source of finance?
309. shares of ownership in a company A. Very low rate of interest
A. assets B. It will bring new skills to the business
B. stocks C. It doesn’t need repaying
C. revenue D. Repayment is always spread over a pe-
D. quote riod time
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 367
315. Wealthy individuals who invest in high 321. Secondary markets:
risk businesses are
A. allow borrowers to raise long-term
PRACTICE BOOK» NOT FOR SALE
A. Banks funds.
B. Investors B. facilitate capital-raising in the primary
C. Shareholders market.
D. Crowd funding C. allow borrowers to raise short-term
funds.
316. Fill in the blank with the best answer:The
“optimal mix” of financing is known as D. facilitate all of the given answers.
A. accounts payable
322. The interest rate used to calculate the
B. accounts receivable present value of future cash flows is called
C. capital structure the:
D. none of above A. compound interest rate.
317. The maturity period of a commercial pa- B. present value factor.
per usually ranges from: C. future value factor.
A. 20 to 40 days
D. discount rate.
B. 90 to 364 days
C. 120 to 365 days 323. It creates financial relationship between
suppliers and users of short-term funds.
D. 60 to 90 days
A. financial market
318. number of stocks of ownership in a cor-
poration B. money market
A. quote C. stock market
B. stocks D. capital market
C. indexes
324. Which of the following is an example of
D. shares revenue expenditure?
319. giving up one thing for another A. paying staff wages
A. Impulse Buying B. buying a new truck
B. Trade-off C. extending the factory
C. Needs
D. purchasing a machine
D. none of above
325. The sources of money generated by the
320. Which of the following is classed as a
sale of products or services.
short term source of finance?
A. Revenue
A. Trade credit
B. Retained profit B. Expenses
C. New share issue C. Net Income
D. Government grant D. Net Loss
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 368
326. Which is not a type of saving and invest- 331. in which type of business finance are
ment debentures included?
A. Shares A. long term source
B. ISA B. short term source
C. Deposit and savings account C. medium term source
D. none of above
D. Personal Loan
332. This is are markets where transactions in-
NARAYAN CHANGDER
327. a fundamental belief or practice about volving long-term debt or those maturing
what is desirable, worthwhile, and impor- in more than a year is called
tant to an individual
A. capital markets
A. Value
B. money markets
B. Trade-off C. public market
C. Needs D. product marketing
D. none of above
333. Maximation of shareholder wealth is the
goal of the firm.
328. Company has to pay only fixed rate of
interest on the funds borrowed through is- A. true
sue of this source of business finance: B. false
A. Equity Share C. maybe
B. Preference Share D. none of the above
C. Retained Earnings 334. the value of the next best alternative
D. Debentures that must be forgone when making a de-
cision
329. Ali wants to transfer the risk or loss that A. Comparison shopping
might occur if something happen to her.
B. The envelope system
What financial institutions she needs?
C. Alternate approach
A. Brokerage Firm
D. none of above
B. Credit Union
335. Tom borrows $5, 000 at 5% simple in-
C. Mortgage Company
terest. At the end of 5 years, how much
D. Insurance Company interest will he have paid?
A. $1, 250
330. An amount of money offered by a bank to
a borrower at a defined interest rate for a B. $25, 000
fixed period. C. $2, 500
A. Bank account D. $5, 000
B. Bank savings 336. Providing immediate solutions
C. Bank loan A. Capital market
D. Bank Deposits B. Investment decisions
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 369
C. Operating decision 342. Loss is
D. Financial investment A. The money you lose when investing in
PRACTICE BOOK» NOT FOR SALE
something
337. Management acts as an agent for the
owners of the firm B. The money you gain
A. true C. Net Profit
B. false D. Cash Flow
C. maybe
343. How can you find a company’s net in-
D. none of the above come?
338. How do vision/mission statements im- A. Sales revenue plus cost of sales, ex-
pact a business. penses, interest, taxes
A. They help you know what your goals B. income = cost of sales and operating
and morals are expenses
B. too know what to do C. Sales revenue minus cost of sales, ex-
C. They do not effect it penses, interest, taxes
D. none of above D. assets = liabilities + owner’s equity
339. Composed of member-owned producers 344. What is the margin of safety?
and consumers. A. the margin between projected units to
A. Securities Dealers/Brokers be sold and break even point units
B. Investments Banks B. the margin between profit and loss
C. Thrift Banks C. the margin between units and sales
D. Credit Union D. the margin between each break even
point
340. issued by the and sold on the
A. bond market & treasury 345. the cost of operating a facility, such as a
store or factory
B. treasury & bond market
C. safest & investment A. liabilities
D. private & individual B. assets
C. income statement
341. Complete this statement with the best
option:‘The longer the cash-flow cycle D. operating costs
‘
346. Which of the following is not an insurance
A. the less cash the business will need company
B. the lower will be the firm’s working
A. BPI-Philam Life Assurance Corpora-
capital needs
tion
C. the more chance there is for the busi-
B. Manulife Philippines
ness to loan a cash
C. Pru Life Insurance Corp. of U.K.
D. the more working capital and cash the
business will need D. Progress Bank and Trust
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 370
347. Total Costs are calculated by C. Exclusive rewards
A. Fixed Costs + Variable Costs D. Exclusive Premium Branch
B. Costs-Revenue 352. Which of the following is a stable source
C. Revenue-Costs of business finance:
D. Fixed Costs + Variable Costs-Revenue A. Equity Share
348. A form of management-investment com- B. Preference Share
NARAYAN CHANGDER
pany that combines the money of its share- C. Debentures
holders and invests those funds in a wide D. Bonds
variety of stocks, bonds, and so-called
money market instruments. 353. This refers the capacity of the customers
A. Mutual Fund repay you.
B. Leasing Companies A. Collateral
C. Investment Companies B. Capital
D. Private Equity C. Character
D. Conditions
349. Refer to the data in the attached doc-
ument from Spice Co.Ltd (year ending E. Capacity
31/3/1c).Sales revenue $150 000Gross 354. One months closing balance is the next
profit $50 000Overhead expenses $35 months what?
000Capital employed $200 000The net
profit margin was: A. money in
A. 1% B. sales receipts
B. 10% C. cash out
C. 15% D. opening balance
D. 20% 355. Fill in the blank with the best an-
swer:Administration of assets refers to
350. What is meant by the term Cost of decisions about
Sales?
A. management
A. All of the money that is coming into a
business B. accounting
B. The cost of producing a product or a C. investments
service D. none of above
C. The amount of money a business has 356. The financial statement that shows the
left over once all costs have been taken financial position of the business as of a
out particular day.
D. The selling price of a product A. Balance Sheet
351. Give a feature of a premium account B. Income Statement
A. Withdraw more money than usual C. Cash Flow
B. Free Holidays D. Owner’s Equity Income Statement
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 371
357. What type of finance involves less profit 362. Commercial Banks do not provide loans in
going to the owners? the form of:
PRACTICE BOOK» NOT FOR SALE
A. Retained profit A. Overdraft
B. Sale of assets B. Term loans
C. Overdraft C. Reserves
D. Bank loan D. Cash Credits
358. An asset promised by a business to a
363. The margin of safety is calculated by:
creditor if repayment of a loan isn’t com-
pleted A. current level of sales / break-even out-
put
A. interest
B. current level of sales-break-even out-
B. owner’s equity
put
C. collateral
C. current level of sales-profit / break-
D. goodwill even output
359. What is a disadvantage of breakeven D. none of above
analysis?
364. Which of the following is an example of
A. allows the business to see how many
internal finance for a limited company? 1)
products it needs to sell to make a profit
Selling shares 2) Selling debentures 3) Ob-
B. allows the business to calculate its taining a loan 4) Selling off inventories
costs
A.
C. allows the business to make decisions
to improve its profitability B.
D. allows the business to only see such C.
calculations for one product at a time. D.
360. Expand GDR 365. A legal maximum on the price at which a
A. Government Direct Receipts good can be sold
B. Gross Domestic Revenue A. price ceiling
C. Gross Domestic Receipts B. price floor
D. Global Depository Receipts C. scarcity
361. Case Study:Company X sells furniture. It D. market
needs $20, 000 to pay the end of month
salaries. They are facing a cash liquidity 366. is a document used to determine if a per-
problem this month. They are expecting son’s credit history, financial stability, and
debtors to pay back within 45 days references make them a worthy candidate
A. trade credit A. application form
B. overdraft B. Rent
C. bank loan C. Property Manager
D. micro-financing D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 372
367. Short Term sources of finance usually re- 372. Identify the medium term sources of fi-
quire money to be repaid within nance.
A. 1 week A. Loan from banks
B. 1 month B. Public deposits
C. 6 months C. Equity share
D. 1 year D. Trade credit
E. Loans from Financial instituions
NARAYAN CHANGDER
368. What is a bank overdraft?
A. plastic card which authorises pay- 373. if people save more, it enables the bank
ments to to firms for investment
B. sum of money borrowed for a property A. consume
C. limit placed on your bank account B. very low
which allows you to take out more that you C. force them to pay
have in it
D. lend more
D. money kept back every year from prof-
its and reinvested in the business 374. What is the formula for margin of
safety?
369. Which sources of finance is most likely to
A. Actual sales-Break even point
be used by a firm planning to takeover an-
other firm? B. Total revenue-Total costs
A. bank overdraft C. fixed costs + variable costs
B. leasing D. cash inflows-cash outflows
C. share issue 375. Which is an example of a fixed business
D. trade credit cost?
A. Raw materials
370. An increase in the present value may be
caused by B. Interest Payments
A. increase in the discount rate C. Packaging
B. decrease in the discount rate D. Wages to production workers
C. discount rate does not affect the 376. What factor that influence sale in an ex-
present value ternal factor?
D. none of the above A. Financial position of the company
371. An individual or an organization that pro- B. Management style of the managers
vides funds to a business, with repayment C. Production Capacity
offunds and agreed-upon interest due at a D. Regulatory Environment
future date.
A. Interest 377. Which aspects of an organisation’s per-
formance with respect to sustainability
B. Rate of Return are measured using ‘triple bottom line’
C. Creditor measures?
D. principal A. Economy, effectiveness, efficiency
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 373
B. Economic, social, environmental 383. It is the borrower’s willingness to pay
C. Profitability, liquidity, investment the loan.
PRACTICE BOOK» NOT FOR SALE
D. Productivity, activity, profitability A. character
B. capacity
378. What is a Mission statement?
A. The same as a vision statement C. collateral
B. A statement that states what your busi- D. condition
ness is built on
384. The present value of cash flows for a cap-
C. A mission your on ital project minus the initial investment is
D. none of above calculated by the
379. The length of time invested money is con- A. payback method.
trolled by others is known as the B. opportunity cost.
A. term C. net present value.
B. conditions
D. internal rate of return.
C. agreement
D. return 385. Which is not a concern of Financial Man-
agement?
380. Capital markets in the UK are split into:
A. acquisition
A. the London Stock Exchange and the
Bank of England B. financing
B. stock markets and bond markets C. management
C. primary and secondary markets D. ruling
D. securities markets and banks
386. It is not a bank but they extend credit or
381. the systematic process of recording and financing to companies in the form of rent-
reporting the financial position of a busi- ing, often used by businesses to finance
ness the acquisition of land, buildings, machin-
ery, and other industrial equipment.
A. accounting
B. financial plan A. Leasing Companies
C. income statement B. Investment Companies
D. balance sheet C. Mutual Fund
382. These are type of investments or funds of D. Insurance Companies
small investors pooled together and man-
387. or renter, is the one who rents the prop-
aged to be able to generate maximum re-
erty
turns.
A. insurance premiums A. Tenant
B. corporate funds B. Rent
C. mutual funds C. occupancy
D. treasury notes D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 374
388. Issued to general public with a prefer- B. Pension fund
ential right to fixed rate of return payable C. Savings bank
as dividend and repayment of capital at
the end of specified period or liquidation D. credit union
whichever is earlier
393. Which of the following contractual re-
A. Preference shares lationships between a bank and a cus-
B. Debenture tomer concerns the bank accepting cus-
tomer property for storage in its safe de-
NARAYAN CHANGDER
C. Equity shares posit?
D. Inter-corporate deposits A. Receivables/payables
389. Which term best relate to the defini- B. Principal/agent
tion:‘Money that is used to run the activi- C. Bailor/bailee
ties of the Business’
D. Mortgagor/mortgagee
A. Loan
B. Finance 394. The person responsible for managing a
firm’s cash flow, credits and capital expen-
C. Grant
ditures is called a
D. Tip
A. broker.
390. Which of the following will probably not B. stakeholder.
be considered by a business before decid-
C. chief accountant.
ing on the most suitable source of finance?
1) The purpose of the finance-what it will D. treasurer.
be used for 2) How long the finance is used
395. Which one is NOT a function of money?
for 3) The rate of interest on loans 4) The
opinions of the workers A. store of value
A. B. unit of account
B. C. medium of exchange
C. D. medium of value
D. 396. It is the difference between current as-
sets and current liabilities
391. Interest earned on both the initial princi-
pal and the reinvested interest from prior A. permanent working capital
periods is called: B. net working capital
A. compound interest. C. temporary working capital
B. simple interest. D. contractual working capital
C. complex interest.
397. is tasked to prepare a cost and ben-
D. dual interest. efit analysis on which is more costly or
392. It is a set up so that employees of corpo- cheaper, to purchase or rent on plant, prop-
rations or governments can receive income erty and equipment.
after retirement. A. logistics
A. life insurance company B. accounting Supervisor
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 375
C. accountant C. Information on the share price
D. bookkeeper D. That the business should become a
PRACTICE BOOK» NOT FOR SALE
partnership
398. when one party grants the other party
the right to use the asset in return for a 403. funds raised through loans or borrowings
periodic payment, it is known as-? are-?
A. lease financing
A. share capital
B. debts
B. owners equity
C. factoring
C. borrowed funds
D. public deposits
D. none of these
399. Which of the following formula is correct
for working out gross profit? 404. Which of these facts about venture capi-
A. = price x units (output or Sales) tal is NOT true?
B. = revenue-cost of sales A. Venture capitalists tend to operate in
C. = gross profit-expenditure fairly risky markets
D. = Fixed costs + variable costs B. Venture capitalists would be paid a
share of the profits
400. It is the allocation of government income
generated from either taxation or bor- C. Venture capitalists usually provide
rowings and the government expenditure money only and have no interest in run-
based on the approved national and local ning the business
appropriation of budget. D. Venture capitalists usually invest large
A. Business Finance sums of money
B. Private Finance 405. The following is a definition of what type
C. Public Finance of market? ”A short-term wholesale mar-
D. Personal Finance ket for securities maturing in one year,
such as certificates of deposit, treasury
401. A location where long-term debt and eq- bills and commercial paper.”
uity securities are sold is called
A. Capital market
A. a risk market
B. The London Stock Exchange
B. a money market
C. AIM (Alternative Investment Market)
C. a development bank
D. Money market
D. a capital market.
402. Which of the following might a bank re- 406. Buying or renting a facility and paying for
quest before it decides to issue a loan to business license fees are examples of
a new business start-up that will operate A. retail costs
as a sole trader and will trade solely in the
UK? B. assets
A. A business plan C. operating costs
B. Data on the exchange rate D. startup costs
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 376
407. Why might finance departments increas- 412. What is the formulas for total revenue?
ingly use technology? (you can select A. Fixed costs x Variable costs
more than one)
B. Selling price x Quantity
A. saves paper copies
C. Cash inflows-Cash outflows
B. confidentiality/privacy
D. Variable cost per unit x Quantity
C. reduces errors
413. Whats the purpose of a business plan?
D. saves time and workload
NARAYAN CHANGDER
A. Too know what a business is
408. The amount of money borrowed. B. Too know how to run your business
A. Collateral C. Too know what you need to do for your
business to be successful
B. Interest
D. none of above
C. Principal
414. Used for business’ operations working
D. Creditor The amount of money bor-
capital.
rowed.
A. Long Term Financial Plan
409. Passed in 2010, this act was a response B. Short Term Financial Plan
to the financial crisis of 2008. It was
C. Long Term Funds
an act that protected consumers against
abuses to interest rates. D. Short Term Funds
A. Dodd Frank Law 415. A vision statement impacts the business
B. Sarbanes Oxley Act because
A. It organizes a business
C. Gramm Leach Bliley Act
B. Reminds the Business Owner why and
D. Federal Reserve Act
how it started
410. The is created by a financial relation- C. Keeps the company on track with the
ship between suppliers and users of short- goals
term funds. D. Keeps profit available
A. financial market 416. Which of the following statements best
B. money market describe debentures?
C. stock market A. Long term bonds issued by businesses
D. capital market B. Short term loans by banks to busi-
nesses
411. Which of the following is not a financial C. A type of overdraft
institution?
D. A loan that is secured against an asset
A. A pension fund
417. What of the following is a source of in-
B. A newspaper Publication ternal finance?
C. An Insurance Company A. Selling assets
D. A Commercial Bank B. Trade credit
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 377
C. A bank loan 423. A picture of the financial condition of the
D. none of above business as of a specific date.
PRACTICE BOOK» NOT FOR SALE
A. Balance Sheet
418. how many central banks are in Jamaica
B. Annual Report
A. 1
C. Income Statement
B. 2
D. Statement of Cash Flow
C. 3
424. A successful sole trader wants to raise
D. 4
funds to open a second restaurant and is
419. Gross profit minus all the expenses re- eager to retain full control of the business.
lated to the business is referred to as Which of the following sources of finance
would be the most appropriate to fund this
A. Net income
expansion?
B. Negative Revenue A. Gain a partner
C. Total Income B. Arrange an overdraft facility
D. Net profit C. Obtain a bank loan
420. The key variables in the owner wealth D. Issue new shares
maximization process are
425. tracks the prices of 500 different stocks
A. earnings per share and risk as a measure of overall stock market per-
B. cash flows and risk formance
C. earnings per share and share price A. Dow Jones
D. profits and risk B. NYSE
C. S & P 500
421. the total amount of money the business
receives from its customers for its prod- D. NASDAQ
ucts and services 426. If you know you were about to experi-
A. revenue ence cash flow problems what would you
B. net profit arrange?
C. gross profit A. source of finance
D. assets B. increase sales
C. cut costs
422. In the balanced scorecard, measures of
D. fire employees
how quickly and fully employee sugges-
tions are implemented would be included 427. Fill in the blank with the best an-
in: swer:A capital investment decision regard-
A. financial perspective measures ing which projects a firm should invest in
is called
B. customer perspective measures
A. accounts payable
C. internal business process perspective
measures B. accounts receivable
D. innovation and learning perspective C. capital budgeting
measures D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 378
428. Wealth maximization as the goal of the 434. Which one is NOT the role of financial
firm implies enhancing the wealth of managers?
A. the Board of Directors A. Obtaining and servicing short-term fi-
B. the firm’s employees nance.
C. the federal government B. Distributions of dividends to share-
D. the firm’s stockholders holders.
C. Cash reinvested
429. an official ban on trade or other commer-
NARAYAN CHANGDER
cial activity with a particular country. D. None of the above
A. embargo
435. These are the major deposit instruments
B. tariff except one;
C. quota A. business account
D. none of the above B. checking account
430. The specific aspirations of a company, the C. saving account
major goals it will try to reach.
D. time deposit account
A. Vision Statement
B. Company Description 436. Which of the following is not a Thrift
Bank in the Philippines
C. Mission Statement
D. Executive Summary A. Planters Bank
B. China Bank
431. What is the formula for Break even
point? C. PS Bank
A. Selling price x Quantity D. Coco Life
B. Opening balance +/-profit/loss
437. Choose the key parts of the company de-
C. Total revenue-Total costs scription?
D. Fixed costs/ selling price-Variable A. Finance Plan
costs per unit
B. Liabilities
432. Forecasting the financing requirement
three to five years down the road. C. Location
A. Long Term Financial Plan D. Ownership Structure
B. Short Term Financial Plan E. Products/Services & Target Market
C. Long Term Funds
438. the length of time for which a business
D. Short Term Funds summarizes and reports financial informa-
tion
433. Business finance is needed to
A. Establish a business A. month
B. Run a business B. year
C. Expand a business C. market
D. All of the above D. fiscal period
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 379
439. A description that provides an outline of 444. The key parts of a Business Plan are
a business A. Company Description
PRACTICE BOOK» NOT FOR SALE
A. Executive Summary B. Management Plan
B. Company Description C. Marketing and Financial Plan
C. Contingency Plan D. Specific Goals the company will reach
D. Mission Statement E. All of the above
440. One of the internal stakeholders wherein 445. billy want to expand his business what
the financial reports are necessary for should he do
them for decision making purposes. They
A. set up stock
are called
B. borrow money
A. Top Management
C. send his own money
B. Department managers
D. eat a strawberry sunday
C. Board of directors
D. employees 446. One of the financial institutions that op-
erates by collecting premiums from clients
441. In this kind of financing policy, some is called
of the temporary working capital require- A. brokerage
ments are financed by long-term sources
of financing. B. credit union
C. investment banks
A. agressive working
D. insurance companies
B. conservative working
C. maturity-matching 447. They are the stakeholders who are inter-
ested in the firm’s ability to earn profits
D. temporary working capital and a reasonable amount or return on in-
vestment.
442. To focus on producing one thing to im-
prove productivity is known as: A. creditors
A. Specialization B. management
B. International trade C. employees
C. Absolute Advantage D. investors
D. Supply and Demand 448. Expenditure is defined as;
443. Financial institutions are also known as A. Only the money that is spent on buying
new stock
B. All of the money that goes out of a busi-
A. financial instruments
ness
B. financial intermediaries
C. Only the money spent on start up costs
C. financial managers
D. All of the money that comes into a busi-
D. financial markets ness
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 380
449. Mr. Smith used the title on his car to se- setting up a business? 1) There are no in-
cure a loan from XYZ Bank. XYZ Bank is terest costs so the business will be more
referred to as the: profitable 2) Very large loans can be ob-
A. Creditor tained 3) The finance does not have to
be repaid 4) Finance is provided to people
B. Collateral who could not usually obtain a bank loan
C. Principal A.
D. Interest B.
NARAYAN CHANGDER
450. A business makes a loss when: C.
A. Total revenue is greater than total D.
fixed costs 455. To draw the BE graph you must plot Total
B. Total revenue is less than total vari- Costs and
able costs A. Total Production
C. Total costs are greater than total rev- B. Total Revenue
enue
C. Total Fixed Costs
D. Total costs are less than total revenue
D. Total Units
451. A firm sells 10 units at £5 each. Its total 456. Most businesses raise money by selling
costs are £30. How much profit is made? their securities in a.
A. A £50 profit is made A. direct placement
B. A £20 profit is made B. stock exchange
C. A £20 loss is made C. public offering
D. none of above D. private placement
452. What is an example of short term fi- 457. What is the third step in the accounting
nance? cycle?
A. Mortgage A. A trial balance of the accounts is pre-
pared
B. Factoring
B. Closing entries are completed
C. A bank loan
C. Transactions are recorded in journals
D. none of above
D. Journal entries are posted in the ap-
453. Which of these is not a common principle propriate accounts
of planning personal finance? E. Financial statements are prepared
A. Generate income and savings
458. Firms that require funds from external
B. Counter the effects of inflation sources can obtain them from
C. Maintain a good credit rating A. financial markets.
D. Avoid solvency B. private placement.
454. Which one of the following is an advan- C. financial institutions.
tage of micro-finance for an entrepreneur D. All the above.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 381
459. Select ALL the institutions that are part 464. Fill in the blank with the best answer:The
of the formal financial sector finance and functions are closely re-
lated and sometimes overlap.
PRACTICE BOOK» NOT FOR SALE
A. Commercial Banks
A. management
B. Money Lender
B. accounting
C. Sou Sou
C. investments
D. Credit Union
D. none of above
460. It is the use of small amounts of capi-
tal from a large number of individual to 465. A company’s net profit margin fell from
finance new business venture. 15% last year to 12% this year. The best
explanation for this change is:
A. Microfinance
A. sales increased and costs fell
B. Crowd funding
B. overhead expenses rose by more than
C. Venture capital sales revenue
D. none of above C. gross profit margin rose and sales rev-
enue increased
461. Which of the following is not a working
capital requirement: D. overhead expenses fell by more than
sales revenue
A. Fund required for purchase of raw ma-
terial 466. Corporate owner’s receive realizable re-
B. Fund required for payment of salary to turn through
employees A. earnings per share and cash dividends
C. Fund required for purchase of Long B. increase in share price and cash divi-
Term Assets dends
D. Fund required for purchase of stock C. increase in share price and earnings
per share
462. Which of the following would be the most
appropriate source of funds for a new busi- D. profit and earnings per share
ness (which is just launching) that makes 467. What is missing from this formula to cal-
mobile phone accessories? culate gross profit? Revenue (minus)
A. Retained Profit A. Expenditure
B. Sale of Assets B. Cost of sales
C. Share Capital C. Cashflow
D. Trade Credit D. Income
463. The formula to calculate a firm’s variable 468. Which of the following is a current as-
cost per unit is: set?
A. Total costs/output A. Buildings
B. Total variable costs/output B. Creditors
C. Output/total costs C. Land or property
D. Output/total variable costs D. Inventory
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 382
469. Which of the following is not a principle 474. What your company is responsible for, by
of a free enterprise economy? law
A. right of private ownership A. Assets
B. competition among businesses B. Expenses
C. a major government role in the econ- C. Loss
omy D. Liabilities
D. freedom of choice
NARAYAN CHANGDER
475. Under the lease agreement, the lessee
470. Companies that buy and sell stocks of gets the right to:
other companies for the purpose of re- A. Share profits earned
selling them for a profit.
B. Participate in the management of the
A. Securities Dealers/Brokers organisation
B. Investments Banks C. Use the asset for a specified period
C. Thrift Banks D. Sell assets
D. Credit Union 476. Financial institution that caters financing
to relatively low-income individuals, bor-
471. Which of the following institutions is pri-
rowing requires collateral to guarantee
marily responsible in the trading of secu-
payment.
rities of publicly listed corporations in the
Philippines? A. Pawnshops
A. Bangko Sentral ng Pilipinas B. Investments Banks
B. Bureau of Treasury C. Thrift Banks
C. Department of Finance D. Insurance Companies
D. Philippine Stock Exchange 477. Which of the following business decisions
is likely to need long-term finance?
472. Cost of sales are
A. increasing stocks of goods for the sum-
A. The cost of producing a product, other- mer season
wise called direct costs
B. hiring a car for the sales manager
B. Other costs that are not related to pro-
C. building a new factory
ducing the product, otherwise known as
indirect costs D. paying creditors for goods supplied
C. Cost that do not change with output 478. Limited companies sometimes need large
D. Running costs amounts of capital in order to expand their
businesses. Which of the following is
473. An example of working capital is most likely a disadvantage of issuing new
shares?
A. pay electricity bills.
A. You have to share profits (dividends)
B. pay machinery.
with shareholders
C. pay rent cost.
B. New share issue can raise the profile
D. pay insurance. of the business
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 383
C. Interest payments can reduce profits 484. The valuation calculating the present
D. Money has to be paid back value of a future cash flow to determine
its value today is called valuation.
PRACTICE BOOK» NOT FOR SALE
479. Raising funds from outside sources and A. complex
not from the ordinary results of business
B. current
A. Operating decisions
C. discounted cash flow
B. Financial investment
D. future cash flow
C. Financial expenditures
D. Financial desicion 485. Danny B, is a business owner. For 5
years in the business, he saved Php 500,
480. When experts invest in a business this is 000 in his bank account. Danny invests a
known as.. part of this money into a government bond
A. Share capital with low risk but low return. What type
B. Venture capital of risk tolerance is shown?
C. Franchise A. conservative risk tolerance
D. Private Limited Company B. moderate risk tolerance
C. aggressive risk tolerance
481. a federally sponsored corporation that in-
sures accounts in national banks and other D. low tolerance
qualified institutions
486. Increasing credit terms to costumers are
A. FDIC likely to:
B. Federal Deposit Insurance Corpora- A. upset costumers
tion
B. please costumers
C. Act Signed into law by FDR in 1933
C. decrease working capital
D. All of the above
D. provide additional long term finance
482. advantage of bank loans
487. The customer of Finkle Ltd has refused
A. LA collateral or security will be re- to take delivery of goods because it says
quired before any funds are lent out. they do not meet its quality requirements.
B. the owners still have control over the Which type of risk is this an example of?
business if no shares are issued to dilute A. Physical
their ownership.
B. Credit
C. Great opportunity for lower poor class
C. Trade
D. Cheap and easily available
D. Liquidity
483. Which of the following is a ‘reward’ of
saving money 488. capital obtained by issue of equity shares
is known as-?
A. Can be exciting
B. Interest payments A. loans
C. No guarantee of return B. share capital
D. inflation can reduce the spending C. debts
power of money saved D. reserve funds
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 384
489. What shareholders get in return on in- 494. Which of the following is NOT usually
vestment? considered a personal source of finance.
A. Interest A. Savings
B. Rent B. Redundancy payments
C. Debentures C. Crowdfunding
D. Dividend D. Credit card
495. Jana wants to buy an expensive new ma-
NARAYAN CHANGDER
490. is a person who works for the owner to
chine for her salon and she wants pay in-
find/screen tenants, collect rent, maintain
stallments over 5 years. What is the best
property, and respond to tenants’ needs
source of finance for this case?
A. Property Manager A. Trade credit
B. application form B. Overdraft
C. Tenant C. bank loan
D. none of above D. leasing
491. Equity Shareholders are called 496. Sunita has the choice of two investments
carrying similar levels of risk. One is
A. Owners of the Company
short-term and the other is a long-term
B. Partners of the Company bond. Sunita should expect the interest on
C. Executive of the Company the longer term bond to be
A. normally higher
D. Guardian of the Company
B. lower
492. Which of the following is not a reason C. normally the same
why a business needs money? 1) To start
the business 2) To expand the business 3) D. impossible to tell
To deal with a negative cash-flow problem 497. The type of financial manager who moni-
4) To increase prices of its products tor and control the flow of cash that comes
A. in and goes out of the company to meet the
company’s business and investment needs.
B.
A. Cash Manager
C.
B. Controllers
D.
C. Credit Manager
493. Fixed assets are: D. Insurance Manager
A. Items that the business owns that will 498. Which of the following statements about
last for more than one year personal sources of finance is false?
B. Machinery that cannot be moved A. Often cheaper in the long-term
around the factory
B. Less ‘red tape’ or delay in getting the
C. Fixtures and fittings that can never be cash
sold
C. Less personal financial risk for the en-
D. none of above trepreneur
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 385
D. May be harder to raise large amounts 504. Something of value that can be claimed
by a lender if a loan is not repaid
499. Which of the following is not a reason for
PRACTICE BOOK» NOT FOR SALE
A. Property
finance (that we have studied)
B. Creditor
A. To start up
C. Collateral
B. To manage daily operations
D. Interest
C. To manage budgets
D. To expand 505. An advantage that share capital (equity
capital) has over long-term loans is that:
500. Hire purchase is used when a business: A. the capital never has to be repaid
A. Wishes to pay for an asset in install- B. the rate of interest on shares is fixed
ments
C. the balance of control in the business
B. Wishes to change its legal structure will change
C. Wants to own the asset straight away D. dividends are paid before tax
D. Wishes to upgrade assets on a regular
506. Which of the following is an appropria-
basis
tion of profit
501. Fill in the blank with the best answer:The A. Interest on Loan
finance function plans and controls com-
B. Depreciation on fixed assets
pany
C. Dividend on shares
A. management
D. Salary of employees
B. accounting
C. spending 507. It is the specific mixture of long-term
debt and equity the firm uses to finance
D. none of above its operations.
502. A portion of the net earnings may be re- A. Capital Structuring
tained in the business for use in the future. B. Capital Budgeting
It is a source of:
C. Working Capital
A. Selffinancing
D. Assets and Liabilities
B. Publci financing
508. Which situation shows investment re-
C. Retained financing
turn?
D. External financing A. Sasha invest Php 100, 000 in a cooper-
ative and gets Php 101, 000 after a year.
503. What is the most likely source of finance
for a small firm? B. Sasha saves Php 100, 000 in a bank
and gets 200 interest per month
A. A debenture
C. Sasha saves Php 1, 000 in a coin bank
B. Issuing shares
per month.
C. A bank loan
D. Sasha plans to establish a sari-sari
D. none of above store with her Php 100, 000.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 386
509. A business plan uses these to show they 514. is granted to those customers who
will be profitable in the future: have reasonable amount of financial stand-
A. Written and/or electronic receipts ing and goodwill.
from customers and distributors A. Trade credit
B. Just the balance sheet B. Reserves
C. Excel spreadsheets of inventory and C. overdraft
sales. D. None of these
NARAYAN CHANGDER
D. A variety of financial statements, like 515. Total revenue is LESS THAN total ex-
the balance sheet, income statements, penses.
and profit and loss statements
A. Revenue
510. refers to the funds raised through loans B. Profit
A. external sources C. Loss
B. equity shares D. Debt
C. debentures 516. ADRs are issued in
D. borrowed funds A. Canada
511. They are the stakeholders who are inter- B. China
ested in the firm’s ability to satisfy its fi- C. India
nancial obligations.
D. USA
A. creditors
517. Ira wants to buy a bonds and stocks.
B. management Bonds and stocks are ?
C. employees A. Cash Instruments
D. investors B. Derivative Instruments
512. Internal sources of capital are those that C. Foreign Exchange
are: D. Financial Instruments
A. Generating through outsiders such as 518. All are category of decision making by
suppliers the finance officer except for one
B. Generating through loans from com- A. Planning Decisions
mercial banks
B. Financing Decisions
C. Generated through issue of shares
C. Operating Decisions
D. Generated within the business D. Investing Decisions
513. Which of these might appear on a balance 519. Someone who leads, or has the ability to
sheet? lead, others is called
A. Cost of sales A. an employee
B. Cash flow forecast B. an entrepreneur
C. Staff salaries C. a leader
D. Creditors D. a teacher
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 387
520. A business can have better control over 525. What is a disadvantage of a bank loan?
its cash flow if it: A. It means you have no savings
PRACTICE BOOK» NOT FOR SALE
A. operates an efficient credit control sys- B. It can lead to personal conflicts
tem
C. It can take a long time to arrange
B. keeps up to date records of financial D. They can be recalled immediately
transactions
526. An individual or organization that pro-
C. always plans ahead by producing a
vides funds to a business, to be repaid a
cash flow forecast
future date is
D. pays all of its bills on time A. a creditor
521. If Dave want to buy and sell debt securi- B. an investor
ties. Which Market did he have to go? C. a loan shark
A. Financial Market D. a fool
B. Bond Market 527. Which of the following is NOT a benefit
C. Commodities Market of working for yourself?
A. Setting your own schedule
D. Derivaties
B. Doing what you are passionate about
522. Two disadvantages of using share capital C. Being your own boss
or venture capital is..
D. Punching the clock for a paycheck
A. Dilutes ownership
528. What kind of documents would be in-
B. Potential conflict between owners cluded in a financial plan?
C. Higher tax is paid A. Bank statements Balance sheets etc
D. Reduced revenue B. none
C. Random paperwork
523. Piece of ownership in a company, mutual
fund or other investment D. none of above
A. Share/stock 529. Which source of finance is only for limited
companies?
B. 401K
A. bank loan
C. Bond
B. share issue
D. none of above
C. mortgage
524. These include payments to suppliers and D. venture capital
other service provideds, loans, and cash
530. Issued with an unsecured promissory
dividends.
note.
A. cash disbursements
A. Banker’s Acceptances
B. sales budget B. Commercial Papers
C. cash receipts C. Commercial Finance company loans
D. target cash balance D. Short Term Bank Loans
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 388
531. It includes the vision, mission, and goals 536. Micro-finance is often used as a source of
set by the top level of management finance in developed countries.
A. tactical planning A. True
B. strategic planning B. False
C. operational planning C. Not enough information
D. financial planning D. True and False
NARAYAN CHANGDER
532. There must be sufficient finance to pay 537. Coins, bank notes, checks, and debit
for the daily running of the business. This cards are commonly referred to as
money is known as
A. financial instruments
A. Working capital
B. financial services
B. Work-in-progress
C. money
C. Retained profit
D. liquidity
D. Buffer stocks
538. Which of the following is an example of
533. unemployment rate external finance for a limited company? 1)
A. include the people of the labor force Retained profits of the company 2) Selling
that are unemployed are looking for work shares 3) Sale of assets no longer used in
to do the business 4) Selling off inventories
B. people who have to live without on the A.
streets B.
C. homeless C.
D. people who are employed
D.
534. The Fine Distributors is a trading firm.It
539. An advantage to a business of leasing
provides you the following data:Actual
computers rather than buying them out-
sales:$75, 000 Margin of safety:$15,
right is that:1) the loan never has to be
000Calculate break-even sales of Fine Dis-
repaid 2) the computers will never go out
tributors.
of date 3) the total cost of leasing is al-
A. $90, 000 ways cheaper than buying the computers
B. $60, 000 4) the company does not have to find a
large cash sum to buy the computers
C. $5, 000
A.
D. none of above
B.
535. A line which starts from 0 and goes di-
C.
agonally across a breakeven chart would
likely be? D.
A. fixed costs 540. Capital budgeting decisions or invest-
B. total costs ment decisions
C. sales revenue A. Business finance
D. none of above B. Financial decision
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 389
C. Financial management C. investor & borrow
D. Financial investment D. security & firms
PRACTICE BOOK» NOT FOR SALE
541. Future value interest factor (FVIF) is rep- 546. You are presented a financial statement
resented by the formula and from it you can tell what the business
A. (1 + i)n owed looking at a financial statement. By
studying the information on the statement,
B. (1 + n)i
you can tell what the business owns and
C. (n + i)1 what it owes as of a certain date. You are
D. (1x + i)n looking at:
A. Income Statement
542. The owners of this instrument have vot-
ing rights. B. Assets
A. preferred stock C. Revenues
B. common stock D. Balance Sheet
C. prepared stocks 547. Profit maximization fails because it ig-
D. preference stock nores all EXCEPT
543. Often includes a letter from the chief A. the timing of returns
executive, a narrative discussion of the B. earnings per share
year’s operations, and plans for the fu-
C. cash flows available to stockholders
ture.
A. Balance Sheet D. risk
B. Annual Report 548. What is an indirect cost?
C. Income Statement A. Costs that increase directly with
D. Statement of Cash Flow changes in production or output.
B. The costs directly involved in making
544. Which of the following business decisions
one product.
is likely to need long-term finance? 1) In-
creasing inventories of goods for the sum- C. Costs that remain the same regardless
mer season 2) Hiring a car for the sales of how many items you make or sell.
manager 3) Building a new factory 4) Pay- D. Costs other than those involved in mak-
ing creditors for goods supplied ing the product.
A.
549. Adam Smith’s theory that the actions of
B.
independent, self-interested buyers and
C. sellers will often result in the most effi-
D. cient allocation of resources
A. Invisible Man Theory
545. a specific type of tha tis sold by
for government B. Waving Hand Theory
A. investor & secruity C. Invisible Hand Theory
B. government & security D. Indecisive Hand Theory
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 390
550. Capital employed is obtained by adding 555. the number a bank gives to an individual
together ‘shareholders funds’ and ‘long- account
term liabilities’. Which of the following A. phone number
would not be included in this addition?
B. account number
A. Profit and loss reserves
C. routing number
B. Loans
D. none of above
C. Working capital
556. Which of the following enjoy voting
NARAYAN CHANGDER
D. Share capital rights on various issues of the company?
551. A detailed financial plan for a person’s ex- A. Equity Share Holders
penses B. Preference Share Holders
A. Envelope system C. Debenture Holders
B. Wants D. Account Holders
C. Budget 557. Which financial institution is owned by its
D. none of above members?
A. financial service company
552. Equity financing B. savings and loan association
A. *Could be vulnerable to takeover C. commercial bank
B. *Quick and easy to access D. credit union
C. *You do not have to give up part of your 558. A company that sells only to households
business in shares or individual consumers is referred to as
D. *Your business or personal belongings A. C2B
e.g. house may be used as collateral
B. ICU
553. A person who is not necessarily the C. B2C
owner of the business but has a stake on D. B2B
how the business is performing is called
559. What the Finance Department not do?
A. stakeholder A. Forecasting cash flow.
B. stockholder B. Producing accounting information for
managers.
C. partners
C. Hold Annual General Meetings.
D. manager
D. Take important decisions of finance.
554. A continuous rise in the price of goods and 560. Establish direction for the financial plans
services of a business.
A. inflation A. Business Financial Goals
B. deflation B. Creditor
C. price ceiling C. Collateral
D. price floor D. Rate of return
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 391
561. Cash flow forecasts do not help a busi- C. The total amount of the loan.
ness: D. The future value of the loan.
PRACTICE BOOK» NOT FOR SALE
A. Predict when it might face a liquidity
problem 566. money and other valuables belonging to
an individual or business
B. See when an overdraft might be
needed A. revenue
C. Forecast the effect of revenue and pay- B. net profit
ments
C. assets
D. Identify its break-even point
D. gross profit
562. What is the definition of Profit?
567. One benefit of external finance is..
A. The income derived from profitable
ventures A. Less chance of insolvency
B. Cash left over at the end of trade B. Structured repayments
C. The money you make C. No interest will be paid
D. The surplus of revenue over costs D. less interest will be paid
563. Which of the following is a conservative 568. we tent to think of as good and vir-
type of investor? tuous
A. invest all resources in a time deposit A. work
B. invest all resources in the stock mar- B. saving
ket
C. school
C. invest all resources in the online sell-
ing business D. fortnite
D. does not invest at all 569. What is a business plan
564. Fill in the blank with the best an- A. A written description of a new busi-
swer:Working capital management fo- ness venture that describes all aspects of
cuses on the company’s current balance of the business.
B. A plan for your business
A. accounts payable
C. Something that shows you how to op-
B. accounts receivable erate your business
C. assets and liabilities D. none of above
D. none of above
570. What two aspects of your business
565. . Mr. Big took out a business loan at ABC records are vital to manage?
Bank for $200, 000. The total cost of the
A. Accounting and document manage-
loan was $305, 000. The difference in the
ment
amount of the loan and the total cost of the
loan is referred to as? B. Accounting and income
A. The interest amount of the loan. C. Receipts and document management
B. The principal amount of the loan. D. Profit and loss
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 392
571. Employees who have innovation skills 576. In a loan amortization schedule, inter-
are able to: est payments for each period would most
probably
A. Socialize effectively.
A. Increase overtime
B. Behave aggressively.
B. Decrease overtime
C. React to problems.
C. Remain the same
D. Think in new ways.
D. There are no interest payments in the
NARAYAN CHANGDER
572. It is the ability of business to pay its cur- schedule.
rently maturing liabilities as they fall on 577. Someone who does contract work for dif-
its due date. ferent companies to complete projects or
A. Profitability assignments is referred to as
B. Liquidity A. an entrepreneur
B. a leader
C. Solvency
C. an employee
D. Stability
D. a freelancer
573. Which of the following is not true of a 578. a decrease in the general level of prices
debenture?
A. inflation
A. Debenture holders get a fixed rate of
B. deflation
return
C. price ceiling
B. They must be repaid on an agreed date
D. price floor
C. All businesses can have debenture
holders 579. Who owns a credit union?
D. Debenture holders are creditors of the A. its members
company B. investment bankers
C. the government
574. Business decisions are more likely to be
permitted at lower levels within the com- D. commercial banks
pany in an organization that is 580. The science and art of managing money.
A. centralized A. Financial Management
B. decentralized B. Finance
C. horizontally integrated C. Management
D. vertically integrated D. Personal Finance
581. What is the second step in the accounting
575. Which source of finance is best for high
cycle?
potential start up businesses?
A. Financial statements are prepared
A. bank loan
B. Closing entries are completed
B. loan from family and friends
C. Transactions are recorded in journals
C. venture capital
D. Journal entries are posted in the ap-
D. savings propriate accounts
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 393
582. What is the formula for Net cash flow? 587. Company X has 1m cash in their bank ac-
count, and they need to purchase a ma-
A. Selling price x quantity
chine cost 1.2m. What is the best source
PRACTICE BOOK» NOT FOR SALE
B. actual sales-break even point of finance
C. Cash inflows-Cash outflows A. leasing
D. Variable costs per unit x Quantity B. overdraft
583. The oldest bank in India is: C. hire purchase
A. SBI D. bank loan
B. Canara Bank 588. Scope of Financial Management that
deals with how business manage fund to
C. PNB
grow or add new products or services.
D. RBI
A. Planning
584. a physical trading floor and a computer B. Budgeting
network in New York where stocks are
C. Procedures
bought and sold; it is the largest stock ex-
change in the world D. Managing & Assessing Risk
A. NASDAQ 589. The final step of the personal financial
B. NYSE planning process is to
C. stock market A. review your progress
D. stock broker B. set financial goals
C. evaluate alternatives
585. Which of the following is a key advan-
tage to a business start-up of gaining D. create an action plan.
funds from family and friends? 590. What is capital expenditure?
A. Flexible repayments A. Money spent for fixed assets which
B. Repayments may need to be made last about 6 months.
quickly B. Money spent for fixed assets which
C. Family and friends may not wish to re- last about for more than a year.
view a business plan C. Money spent on a day-to-day basis.
D. Limited funds available D. Money spent per hour rate.
586. It accepts deposits from individuals and 591. Anagreement in which a borrower re-
organizations that have excess funds and ceives something of value in exchange for
provide loans to those who are in need. apromise to repay the lender at a later
This financial institution is called date is (a) (b) (c) (d)
A. investment banks A. financing
B. commercial banks B. a salescontract
C. credit unions C. credit
D. insurance companies D. collateral
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 394
592. the price of a stock at a particular point C. minimizing return
during the day D. maximizing wealth
A. assets
597. ‘Issued by financial institutions allowing
B. shares customers to delay payments for goods
C. quote and services’ describes which method of
payment
D. indexes
A. Electronic Transfer
NARAYAN CHANGDER
593. These are institutions or organizations B. Credit Card
that provide financial services among oth-
C. Direct Debit
ers, in form of loan, credit, fund admin-
istration, financing depository, and safe- D. Standing Order
keeping.
598. A flower seller plans to increase inven-
A. Capital Market tories of plants before a major festival.
B. Financial Institutions Which of the following is the most likely
source of finance? 1) Bank overdraft 2)
C. Financial Instruments Leasing 3) Share issue 4) Debentures
D. Business Finance A.
594. Michelle wants a non-conventional banks B.
for convince transaction. What type of Fi- C.
nancial Institution did she need?
D.
A. Commercial Bank
599. An gives people money available to
B. Investment Bank invest in small business
C. Internet Bank A. Angel Investor
D. Thrift Bank B. Sponsor
595. A credit union C. Partner
A. is a financial institution that focuses D. Assets
on taking deposits and using them to fund 600. The organisations, which require large
mortgages. amount of fixed capital are
B. is a non-profit institution owned by its A. Trading concern
members and provides financial services
B. Manufacturing concern
to its members.
C. Service sector
C. offers a broad range of deposit ac-
count and gives loans to individuals and D. All the above
businesses. 601. What is “Bottom Line”?
D. is a financial institution for students A. Net Profit
only
B. Things your company is responsible for
596. It is the goal of financial management. C. Financial Assets
A. minimizing risk D. Capital assets
B. maximizing profit E. All of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 395
602. A Profit and Loss Account summarises a C. Dodd Frank Law
business’s D. Gramm Leach Bliley Act
PRACTICE BOOK» NOT FOR SALE
A. stock and raw materials
607. Can be issued only to American cit-
B. highs and lows izens and can be listed and traded on a
C. pros and cons stock exchange of USA.
D. revenues and costs A. Indian Depository Receipt
B. American Depository Receipt
603. Harold is an accountant with Farnworth
plc. He was asked to join a project team C. Foreign Depository Receipt
examining the company’s compliance with D. European Depository Receipt
both FRC and IASB standards. It appears,
therefore, that Harold has been recruited 608. which of the following is an example of
into this project team to exploit his exper- a cash inflow
tise in A. Wages
A. financial reporting B. cash sales
B. performance measurement C. Rent
C. capital budgeting D. interest paid
D. strategic management accounting 609. an exchange rate policy under which a
government permits its currency to be
604. A loan that is secured on a property is
traded on the open market without direct
called a
government control or intervention
A. Mortgage
A. fixed exchange rate
B. Overdraft
B. mixed exchange rate
C. Credit Card
C. managed exchange rate
D. Government Grant D. floating exchange rate
605. a business partner who has decision- 610. A bank undertakes to store and take rea-
making authority, takes an active role in sonable care of a customer’s property and
the operation of the business, and has un- to redeliver it to the customer when re-
limited liability for all losses or debts of quired.In regards to the bank and customer
the partnership relationship, in which capacity is the bank
A. general partner acting?
B. limited partner A. Mortgagor
C. scarcity partner B. Bailee
D. none of the above C. Mortgagee
D. Bailor
606. a 1913 law that set up a system of
federal banks and gave government the 611. One benefit of internal sources of finance
power to control the money supply is..
A. Federal Reserve Act A. Less interest is paid
B. Sarbanes Oxley Act B. No interest is paid
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 396
C. Lots of finance available 617. This type of finance does not need to be
D. Money wont be needed for other repaid.
things A. Bank Loan
612. Provides community assistance that may B. Overdraft
not be offered by government.
C. Mortgage
A. nonprofit organizations
D. Government Grant
B. government
NARAYAN CHANGDER
C. consumers 618. State what results can realistically be
D. financial markets achieved, given available resources
613. Equity shareholders are the: A. Specific
A. Owners of the company B. Realistic
B. Partners of the company C. Assignable
C. Executive of the company
D. Time-related
D. Guardian of the company
614. What is a disadvantage of a friends and 619. provide long term finance
family loan? A. equity shares
A. It means you have no savings
B. shareholders
B. It can lead to personal conflicts
C. financial institution
C. It can take a long time to arrange
D. They can be recalled immediately D. debentures
615. What do Microfinance and Crowd funding 620. Financial managers evaluating decision al-
have in common? ternatives or potential actions must con-
A. They give loan for small businesses sider
B. They charge interest on money in- A. only risk
vested in the buisness
B. only return
C. They become part-owners of the busi-
ness C. both risk and return
D. They are incredibly wealthy D. risk, return and the impact of share
price
616. Identify which point / points is/are not
a characteristics of Debentures.
621. In the Modern Corporation, there is
A. Debenture holders control the busi- no separation between shareholders and
ness with right to vote. management.
B. It represent borrowed funds. A. true
C. Repayment period is predetermined
B. false
D. They are permanent source of busi-
ness. C. maybe
E. They are the owners of company. D. none of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 397
622. If you invest 5000 now, and your invest- 627. A disadvantage of grants and subsidies
ment pays 12% per annum, how much will A. Don’t have to be repaid
you have in three years if compounded an-
PRACTICE BOOK» NOT FOR SALE
nually (to the nearest dollar)? B. Great opportunity for lower classes-
developing countries
A. 7025
C. Can be difficult to qualify
B. 14 821
D. Unlimited grants
C. 6852
628. Which of the following is NOT a main fi-
D. 8014
nancial need of a business?
623. Khaled is looking investors to invest A. A business must provide a competi-
in his current import/ export business. tiverate of return for its investors.
What is the best source of finance for this B. A business must share their growth
case? planswith it’s competitors.
A. Trade credit C. A business must finance future growt-
B. share capital hand improvement to remain competitive.
C. Personal savings D. A business must meet its financialobli-
D. leasing gations and pay its debts
629. The primary goal of the financial manager
624. is money paid in advance of moving in to
is
be used for repairs beyond normal wear
and tear A. minimizing risk
A. Amenities B. maximizing profit
B. security deposit C. maximizing wealth
C. pay advance D. minimizing return
D. none of above 630. Thefinancial records for each of the spe-
cific assets, liabilities, and categoriesof
625. Long-term debt instruments used by both owner’s equity are known as the business’
government and business are known as ?
A. bonds A. accrual
B. equities B. integrity
C. stocks C. debt
D. bills D. accounts
626. Kate make sure that she has a concrete 631. An advantage that share capital (equity
business plan for her dress shop to ensure capital) has over long-term loans is that:1)
that optimal profit for her business. This the capital never has to be repaid 2) the
means? rate of interest on shares is fixed 3) the
A. Earn Profit balance of control in the business will
change if more shares are issued 4) divi-
B. Increasing Profit dends are paid on long term loans but not
C. Earning Profit on shares
D. Maximizing Profit A.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 398
B. 637. Which source of finance involves less
C. profit going to the owners?
D. A. Retained profit
B. Sale of assets
632. an increase in value
C. Overdraft
A. depreciation
D. Bank loan
B. appreciation
638. The directors of Dorntree plc have re-
NARAYAN CHANGDER
C. price ceiling
duced the costs of producing one of their
D. price floor key products, the Palma. At the same
time, they have implemented action plans
633. an economic system in which people can
to achieve the product’s market share tar-
choose what they buy, produce, and sell,
get of 22%. It is clear that the directors
as well as where they work
have focused their efforts for the Palma
A. socialism on:
B. communism A. core competencies
C. marketing B. effectiveness
D. free enterprise system C. economy
634. Which of the following is not an example D. efficiency
of a depository institution? 639. Specify when the results can be achieved
A. Commercial bank A. Specify
B. Savings and Loan B. Measurable
C. Credit Union C. Time-related
D. Loan Company D. Realistic
635. Suppose you need to pay your air-ticket 640. Which of these can be found in the
of P2400 for a European trip next year. owner’s equity section of a balance
If you deposit money now, you can earn sheet?
7% per annum. How much do you need to
A. cash, building and equipment
invest today?
B. mortgage and accounts payable
A. P 1759
C. capital surplus, stock & retained earn-
B. P 1968
ingsThis is a correct answer
C. P 2000
D. none of these
D. P 2243
641. This is the cash that is generated by
636. Number of Products produced / sold is the business when it operates successfully.
also referred to as Which source of finance is this?
A. Output A. Retained profits
B. Revenue B. Share capital
C. Costs C. Angel investor
D. items D. Owner savings
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 399
642. Which of the following are DISADVAN- 647. companies may borrow money to start up
TAGES of selling shares as a source of or
funds? (select as many as appropriate)
PRACTICE BOOK» NOT FOR SALE
A. invest
A. It means limited liability for the own- B. live
ers
C. strawberry short cake
B. Dividends need to be paid to sharehold-
ers D. expand
C. Large sums of money can be raised 648. It is the financial statement which shows
D. Does not apply to Partnerships or Sole the performance of the business for a
Traders given period of time.
A. Cash Flow
643. What is a cash budget?
B. Balance Sheet
A. shows the profit made by a business
C. Income Statement
B. shows at which point the business cov-
D. Owner’s Equity Income Statement
ers its costs
C. forecast of future receipts and pay- 649. A fruit and vegetable farm has increased
ments the credit period with its machinery sup-
plier from 30 days to 45 days. What is
D. shows the value of the business at a the best source of finance for this case?
particular date
A. Trade credit
644. Obligation that matures for more than a B. Overdraft
year and is usually paid in installment.
C. bank loan
A. Long Term Loan
D. leasing
B. Term Loan
C. Mortgage Loan 650. the national currency we use today in the
United States
D. Short Term Loan
A. foreign exchange rate
645. I’d like to change some money.What’s to- B. federal reserve note
day’s ?
C. floating exchange rate
A. rate
D. none of the above
B. exchange rate
651. Advantages of funding growth through a
C. interest rate share issue in all those listed below EX-
D. none of above CEPT
A. An extra source of finance
646. What is the formula for Gross Profit?
B. Less financial risks due to the spread-
A. Revenue-Expenses
ing of risks amongst shareholders
B. Revenue + Cost of Sales
C. Control of the company is diluted
C. Revenue-Cost of Sales
D. It acts as a form of motivation for em-
D. Cost of Sales + Revenue ployees who own shares in the company
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 400
652. Th name of Jamaica’s Central Bank is D. The business will pay less tax on its
A. Central Bank of Jamaica profits
B. National Commercial Bank 657. ‘Allows you to use an item immediately
C. Bank of Jamaica but pay for it in installments’ is a descrip-
tion of which method of payment
D. First Caribbean Central Bank
A. Payday Loan
653. All of the following would be included in
B. Credit Card
NARAYAN CHANGDER
a typical cash flow forecast except:
A. cash sales C. Hire Purchase
B. opening balance D. Personal Loan
C. monthly profit 658. This internal source of finance is not avail-
D. net cash flow able for a newly formed businesses and
unprofitable firms.
654. Which three lines of the profit and loss ac-
A. Personal saving
count would make up the trading account?
B. retained profit
A. Sales Revenue, Cost of Sales and
Gross Profit C. leasing
B. Sales Revenue, Expenses and Gross D. hire purchase
Profit
659. Which of the following is an example of
C. Sales Revenue, Cost of Sales and Net
a cash outflow for a business?
Profit
D. Net Profit, Cost of Sales and Gross A. Payments to creditors
Profit B. Sale of goods for cash
655. Mark decided to borrow Php 5, 000.00 C. Payment from debtors
at an annual simple interest rate of 2%. D. Receiving a loan from the bank
How much does he need to pay after 3
years and 6 months? 660. Into how many broad categories sources
A. Php 305 of finance be categorised?
B. Php 350 A. 2
C. Php 5, 350 B. 3
D. Php 5, 305 C. 4
D. 6
656. Which of the following is an advantage
to a business of using a government grant 661. These are financial instruments that rep-
as a source of finance? resent ownership in a corporation.
A. It does not need to be repaid
A. bonds
B. Businesses must meet specific condi-
B. deposit banks
tions to qualify
C. mutual fund
C. It is relatively quick and easy to apply
for one D. stocks
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 401
662. Which is an example of an external C. asset utilization ratios
source of finance? D. profitability ratios
PRACTICE BOOK» NOT FOR SALE
A. Owners’ Funds
668. Set of goals that lay out the overall direc-
B. Hire Purchase tion of the company
C. Retained profits A. Long-term financial plans
D. Sale of assets B. Short-term financial plans
C. Long-term financial needs
663. is the payment made in exchange for oc-
cupying another’s land or property, usu- D. Short-term financial needs
ally paid to landlord or property manager 669. Which of the following formula is correct
A. Rent for working out net profit?
B. Tenant A. = price x units (output or Sales)
C. security deposit B. = revenue-cost of sales
D. none of above C. = gross profit-expenditure
D. = Fixed costs + variable costs
664. Kasie took out a business loan at Fancy
Bank for $160, 000, is the $160, 000 re- 670. When a company’s finance function pre-
ferred to as? pares financial statements in accordance
with legal rules and accounting standards,
A. The interest amount of the loan.
it is engaged in the support activity of
B. The principal amount of the loan. A. record-keeping and stewardship
C. The total amount of the loan. B. planning and control
D. The future value of the loan. C. external reporting
665. The term ‘redeemable’ is used for D. internal reporting
A. Preference Shares 671. Which of the following legal structures
could finance expansion by issuing new
B. Commercial Paper
shares via the stock market?
C. Equity Shares
A. A sole trader
D. Public Deposits B. A partnership
666. The required return of the owners in a C. A private limited company
company is called D. A public limited company
A. required rate of return.
672. The most important function of a financial
B. cost of capital. market is:
C. cost of debt. A. to facilitate the flow of funds between
D. cost of equity. lenders and borrowers
B. to provide a market for shares.
667. They measure the firm’s overall financial
C. to provide information about an issu-
well-being
ing company’s financial situation.
A. solvency ratios D. to secure profits for brokers and
B. liquidity ratios agents.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 402
673. Which three of the following are charac- 678. What is the formula for Revenue?
teristics of management accounting infor-
A. Output x Selling Price
mation rather than financial reporting in-
formation? B. Output x Cost
A. It is both forward looking and histori- C. Selling Price x Costs
cal
D. Selling Price x Break Even Point
B. It is governed by statute
679. This occurs when a business spends more
NARAYAN CHANGDER
C. It is primarily used by shareholders
D. It is likely to include budgetary infor- money than they make.
mation A. profit
E. It is likely to include a cash flow fore- B. loss
cast
C. capital
674. These are the fixed income securities that
D. asset
are issued by corporate and governments
to raise capital.
680. A dynamic process that does not end
A. bonds when you take a particular action
B. deposit banks A. Financial decision
C. mutual funds
B. Financial planning
D. stocks
C. Financial needs
675. Which of these are assets?
D. Financial action
A. cash, land and capital equipment
B. mortgage 681. What is the first step in creating a busi-
ness?
C. retained earnings
D. interest A. Write a business plan
B. Choose location
676. Which software is best for preparing in-
come statements? C. Get a tax ID number
A. database D. Obtain a permit
B. word processing
682. A farmer has 1, 000 acres. He decides to
C. powerpoint plant apple trees on 800 acres and raise
D. spreadsheets cows on the remaining 200 acres. If he
wanted to raise more cows, he would have
677. Stewardship of the organisation’s finan- to reduce the amount of land allotted to
cial resources is part of which of its finance growing apples. This is an example of:
function’s tasks?
A. Distribution
A. Financial reporting
B. Recording financial transactions B. Opportunity cost
C. Treasury management C. Efficiency
D. Management accounting D. Utility
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 403
683. the amount of money a company makes 688. Refer to the data in the attached doc-
after deducting the costs associated with ument from Spice Co.Ltd (year ending
making and selling its products, or the 31/3/1c).Sales revenue $150 000Gross
PRACTICE BOOK» NOT FOR SALE
costs associated with providing its ser- profit $50 000Overhead expenses $35
vices 000Capital employed $200 000The return
on capital employed was:
A. revenue
A. 7.5%
B. net profit
B. 15%
C. gross profit
C. 25%
D. income
D. 75%
684. The following are examples of variable 689. Which of the following statements about
and fixed costs needed to run the opera- overdrafts is not true?
tions of the company EXCEPT?
A. Short term source of finance
A. Administrative cost B. It’s really a small, short term loan
B. Interest payments C. It’s flexible, in that it can be used
C. Labor whenever it is needed
D. Cheap-the interest rate is usually
D. Rent payments
lower than that of a long-term bank loan
685. The top financial officer in a firm is com- 690. Who own the Central Bank
monly referred to as the:
A. the Prime Minister
A. chief financial officer
B. Government
B. president of finance. C. Private Business Owner
C. controller. D. Opposition Leader
D. finance manager. 691. In order to make a , a business must
have more income than expenses.
686. What is the formula for Profit?
A. loss
A. Revenue-Sales
B. profit
B. Revenue-Costs
C. retail cost
C. Revenue-Fixed Costs D. asset
D. Revenue-Gross Profit
692. A family-owned removals company has
liquidity problems and needs an injection
687. Fill in the blank with the best an-
of funds. From the following list identify
swer:Money others owe to the business
which would be classified as a source of
is referred to as
short-term finance for this company.
A. accounts payable
A. Share capital
B. accounts receivable B. Bank loan
C. assets and liabilities C. Factoring
D. none of above D. Commercial mortgage
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 404
693. What is an investor C. Money spent on day to day expenses
A. Someone who puts money into a busi- D. None of the above
ness to try to make is work and make a
profit 699. When a business expands it usually
needs finance for which one of the follow-
B. a buyer ing reasons? 1) To pay for increased work-
C. A business owner ing capital 2) To pay back shareholders 3)
To pay the government a grant 4) To pro-
D. none of above
NARAYAN CHANGDER
vide a loan to the bank
694. Which is not an capital expenditure ex- A.
ample
B.
A. Computer
C.
B. Rent
D.
C. Buildings
700. What is an advantage of owners’
D. Furniture & fixtures
funds?
695. Sue Yu and Partners is a solicitors want- A. There will be little interest
ing to expand and buy new premises.
B. You can pay in smaller installments
Which source of finance is most suitable?
C. They take a long time to arrange
A. Mortgage
D. You don’t have to pay it back
B. Trade Credit
C. Selling assets 701. How are total costs calculated?
D. Bank loan A. Fixed Costs + Variable Costs
B. Fixed Costs-Variable Costs
696. Which of the following is not an advan-
tage of a bank loan? C. Sales-Fixed Costs
A. interest charged D. Sales-Variable Costs
B. repaid in instalments 702. Which one of the following factors should
C. arranged relatively quickly be considered by a manager when planning
finance for an expansion programme? 1)
D. repaid over a period of time The legal form of the business 2) The loca-
tion of the planned expansion 3) The num-
697. A mortgage would most commonly be
ber of workers employed 4) The time of
used to pay for:
year the expansion is planned for
A. Vehicles
A.
B. Machinery
B.
C. Stock
C.
D. Property
D.
698. What is revenue expenditure? 703. Which of the following is a cause of cash
A. Money spent on monthly expenses flow problems?
B. Money spent on hour to hour expenses A. increasing sales
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 405
B. taking out a bank loan C. lender
C. purchasing new computers for all em- D. . none of the above
PRACTICE BOOK» NOT FOR SALE
ployees
709. In order to assess its sustainability man-
D. choosing a cheaper supplier agement using the Global Reporting Ini-
704. In making a financing decision we have to tiative (GRI), under which three head-
consider what is the best type of financing. ings should an organisation produce per-
formance measures?
A. true
A. Economic
B. false
B. Ecological
C. maybe
C. Environmental
D. all of the above
D. Social
705. The major securities traded in the capital
E. Financial
markets are
A. stocks and bonds 710. One of the scope of Financial Manage-
ment is that business have enough money
B. bonds and commercial paper.
to pay rents, employee salaries, raw ma-
C. commercial paper and Treasury bills terials and other expenses.
D. Treasury bills and certificates of de- A. Planning
posit
B. Budgeting
706. It helps the company by translating the C. Procedures
strategic plans into specific plans or ac-
D. Managing & Assessing Risk
tions carried out by the middle level of
management. 711. a business partner who does not take an
A. tactical planning active role in decision making or in running
the business
B. strategic planning
A. general partner
C. operational planning
B. limited partner
D. financial planning
C. scarcity partner
707. are debt instrument that does not
carry a specific rate of interest, but issued D. none of the above
at a heavy discount 712. Hayley is an accountant with Worricker
A. Debentures plc. Hayley has joined a project team ex-
B. Equity shares amining the cost structure of Worricker plc
compared with its major competitors. She
C. Bonds has been recruited into this project team in
D. None of these order to exploit her expertise in:
708. He/She opens a bank account and earns A. financial reporting
interest from the account. B. performance measurement
A. borrower C. capital budgeting
B. depositor D. management accounting
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 406
713. Preference shares have preference rights C. money market
over the equity shares as to D. fixed-income market
A. Payment of dividend
719. What is the variable cost per unit if at
B. Repayment of capital 100 units the variable costs = £1000?
C. Both (a) and (b) A. 1000
D. voting for all matters
B. 100
NARAYAN CHANGDER
714. Depreciation refers to C. 10
A. Financial assets D. 1
B. Balance sheet
720. Target a specific area improvement
C. The decline of a capital asset
A. Realistic
D. The currents worth of the business
B. Measurable
715. A business takes out a bank loan of £15, C. Assignable
000. The loan will be repaid over 3 years,
D. Specific
with a monthly repayment of £500. The
total interest the business will pay for this 721. It is a collection of financial products
loan is: owned by a single investor, either an in-
A. £1, 500 dividual or organization is called
B. £3, 000 A. product marketing
C. £15, 500 B. investment portfolio
D. £8, 000 C. stock contribution
716. A financial plan begins with a (an) D. product investment
A. opportunity 722. All are examples of cash and cash equiv-
B. threat alents except
C. sales forecast A. Short-term deposits
D. weakness B. Checking account
C. Money market accounts
717. It implies the efficient handling of avail-
able resources. D. Inventory
A. Management 723. An advantage to a business of leasing
B. Allocation computers rather than buying them out-
right is that:
C. Utilization
A. the loan never has to be repaid
D. none of above
B. the computers will never go out of date
718. Financial instruments with maturities of C. the total cost of leasing is less than
less than one year are traded in the buying the computers
A. equity market D. it doesn’t have to find a large cash sum
B. capital market to buy computers
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 407
724. It deals with determining the capital 729. Investor who want steady income may
structure of the company and to raise not prefer-?
funds from debt and equity.
PRACTICE BOOK» NOT FOR SALE
A. debentures
A. investing decisions B. preference shares
B. financing decisions C. bonds
C. operating decisions D. equity shares
D. declaration of dividends
730. Identify which one is/ are not fixed
725. It involves financial planning, asset man- charge funds.
agement, and fundraising decision to en- A. Debentures
hance the value of businesses.
B. Equity share
A. Financial Assets
C. Loans from financial institutions
B. Financial Management
D. Retained earnings
C. Financial Institution
E. Term loans from commercial banks
D. Financial System
731. Which is not a long-term external source
726. Funds of a business which are provided of finance?
by the owner or creditors
A. Share issue
A. Public finance
B. Reducing Trade receivables
B. Financial investment
C. Debenture
C. Private finance
D. Leasing
D. Financial resources
732. Which of the following is not a role of a
727. Which of the following is a short term financial manager
source of finance
A. Prepare financial statements, busi-
A. Overdraft ness activity reports, and forecasts.
B. Loan B. Develop advertising strategy to attract
C. Share Capital customers.
D. Mortgage C. Supervise employees who do financial
reporting and budgeting.
728. A is a type of financial intermedi- D. Review company financial reports and
ary that pools savings of individuals and seek ways to reduce costs.
makes them available to business and
government users. Funds are obtained 733. something thought to be a necessity or
through sale of shares. essential items required for life
A. mutual fund A. Needs
B. savings and loans B. Impulse Buying
C. savings bank C. Budget
D. credit union D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 408
734. What is investment diversification? 739. This is a sum of money saved or made
available for a particular purpose.
A. investment with high profit
A. financing
B. investment with no risks
B. fund
C. investment from different profit-
making activities C. maturity
D. investment with low risks D. risk
NARAYAN CHANGDER
735. A business organisation that is similar to 740. Which formula would calculate sales rev-
a sole proprietorship but has two or more enue?
owners is called a: A. Selling Price + Number of Items Sold
A. limited liability company. B. Selling Price x Variable Costs
B. corporation. C. Selling Price x Number of Items Sold
C. dual company. D. Selling Price x Cost of Sales
D. partnership. 741. Which ones are long-term external
sources of finance?
736. The department that is responsible in re-
questing acquisitions and delivery of as- A. Leasing
sets needed by the company is called B. Working Capital
A. Cashier C. Share Issue
B. finance officer D. Overdraft
C. logistics E. Sale of assets
D. budget officer 742. Types of Financial Institutions that accept
deposits and lend money.
737. An advantage of taking of a new partner
is that: A. Investment Bank
A. it reduces the risk of a takeover B. Internet Bank
B. it ensures the business will be able to C. Thrift Bank
get a loan D. Commercial Bank
C. the partner will bring additional fi- 743. Mainly deposit taking financial institu-
nance tions that extend credit to retail and con-
D. the other partners will now have lim- sumer market
ited liability A. Commercial Banks
738. What kind of investment is said to have B. Thrift Banks
higher returns? C. Islamic Banks
A. low risk D. Cooperatives
B. risk free
744. Which of the following formula is correct
C. high risk for working out sales revenue?
D. average risk A. = price x units (output or Sales)
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 409
B. = revenue-cost of sales C. bank overdraft
C. = gross profit-expenditure D. mortgage
PRACTICE BOOK» NOT FOR SALE
D. = Fixed costs + variable costs 750. Which of the following would appear in
the ’capital employed’ section of the state-
745. Justin Time, a Sole trader has com-
ment of financial position?
pleted a cash flow forecast that shows
3, 000 short at the end of next month. A. Share capital
How would you advise him to obtain this B. Tax due
money?
C. Revenue
A. Mortgage
D. Overdraft
B. Share Issue
751. A disadvantage of break-even analysis
C. Overdraft
is:
D. Bank loan
A. It is assumes that all of the products
746. This source of business finance is the por- are sold
tion of profit which is invested in business, B. It is easy to work out
rather than distributing is as dividend to
C. It allows businesses to predict how
shareholders.
changes in sales may affect costs, rev-
A. Equity Share enues and profits
B. Preference Share D. That businesses can use it to help per-
C. Retained Earnings suade a bank to give them a loan
D. Debentures 752. Which of the following does Not belong
to the group?
747. the responsibility of business owners for
all of the debts of the business A. GSIS
A. unlimited liability B. SSS
B. limited liability C. Government banks
D. Government non-banking
C. marketing
D. legal debt 753. It is the process of comparing amounts in
the financial statements within the same
748. Working capital is sometimes called as accounting period.
A. Horizontal Analysis
A. life of money
B. Vertical Analysis
B. life of blood
C. Financial Statement Analysis
C. life of soul
D. Diagonal Analysis
D. life of human
754. Businesses might choose to use external
749. Which of these is a short term source of sources of finance because
finance? A. There are no interest charges
A. share capital B. Potential cash flow problems are
B. venture capital avoided
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 410
C. There is insufficient retained profit 760. You have P 50 000 now to invest. If you
D. There is an expected rise in interest can earn 10% per annum on your deposit,
rates and can invest for five years, what will be
the future value of your deposit (to the
755. retail sales nearest dollar) at the end of the invest-
ment period?
A. the total wages earn
A. P150 493
B. ms caratelli is the best
B. P80 526
NARAYAN CHANGDER
C. spending pattern
C. P99 456
D. includes the sales of goods and ser-
D. P85 025
vices purchased to indicate spending pat-
terns 761. A limit placed on the quantities of a prod-
uct that can be imported
756. Which is an internal source of finance?
A. tariff
A. Overdraft
B. quota
B. Mortgage
C. embargo
C. Owners’ funds
D. none of the above
D. Debenture
762. What is the ideal situation for a business
757. Which current account is most appropri- to be in?
ate for someone with a low credit rating? A. cash in = cash out
A. Standard B. cash in < cash out
B. Packaged, premium C. cash in > cash out
C. Basic D. none of above
D. Student
763. A hair salon has a balance of LE 37,
758. What is an advantage of a bank loan? 000 in their account. To pay this month’s
wages, the manager withdraws LE42,
A. There will be little or no interest 000What is the best source of finance for
B. You can pay in smaller installments this case?
C. They are quick and easy to arrange A. Trade credit
D. You don’t have to pay it back B. Overdraft
C. bank loan
759. Fill in the blank with the best answer:A
D. leasing
measure of how well a business generates
cash flow in relation to its invested capital 764. What technology would be used to re-
is mind customers to pay bills?
A. equity financing A. word processing
B. stock B. powerpoint
C. return on capital C. email
D. none of above D. spreadsheets
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 411
765. A type of financial institution known to B. Law of Survival
successfully raise funds for big corpora- C. Deferment
tions and governments
PRACTICE BOOK» NOT FOR SALE
D. Best Choice
A. Thrift Bank
B. Commercial Bank 771. the central bank of the United States
C. Investment Bank A. federal reserve bank
D. Universal Bank B. bancorpsouth
C. foreign exchange market
766. What is the first step in the accounting
cycle? D. FDIC
A. Financial statements are prepared 772. GDR can not be issued in which of the fol-
B. Closing entries are completed lowing country?
C. Transactions are recorded in journals A. Canada
D. Journal entries are posted in the ap- B. India
propriate accounts C. USA
767. Which of the following is NOT a reason D. China
why a business needs money?
773. In this kind of working capital policy,
A. to start the business some of the temporary working capital
B. to expand the business requirements are financed by long-term
C. to deal with a negative cash-flow prob- sources of financing.
lem A. maturity-matching
D. to increase prices of its products B. conservative
768. Benefits of a pre-paid card C. aggressive
A. Can’t go into debt D. modern
B. Pay before hand 774. It involves day-to-day operations carried
C. Buy now pay later available out by the lower-level management.
D. Requires no credit check A. strategic planning
B. operational planning
769. Which of these famous entrepreneurs
DID NOT start his business before the age C. financial
of 25: D. tactical planning
A. Steve Jobs-Apple Computer
775. an advantage of grants and subsidies
B. Louis Braille-Braille Writing System source of finance is
C. Wally Blume-Denali Moose Tracks A. Firms must locate a particulate area
D. Mark Zuckerberg-Facebook B. Unlimited grants subsidies in terms or
770. What you give up when you make a time and amount
choice is called? C. don’t have to be repaid
A. Opportunity Cost D. Can be difficult to qualify
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 412
776. With which one of the following sources 781. The time value of money suggests that a
of finance, is the term redeemable associ- peso received today is worth a peso
ated? received in the future.
A. Global Depository Receipt A. less than
B. Equity Shares B. more than
C. the same as
C. Public Deposits
D. none of the above
D. Debentures
NARAYAN CHANGDER
782. Which one is NOT the function of the con-
777. These instruments are issued by finan- troller?
cially sound businesses to fund invest-
A. Economic appraisal
ments in inventories and receivables.
B. Protection of assets
A. treasury bills
C. Selling stocks
B. commercial papers
D. Evaluation of company objective and
C. preferred stock policies
D. money market funds 783. Which is an example of a person obtain-
ing unpaid work experience?
778. The method of calculating interest once
during the entire life of the loan, on the A. Jim hires Kevin to cut his lawn every
original sum borrowed, is known as: week.
B. Kelly volunteers at a local radio sta-
A. simple interest.
tion.
B. interest on interest. C. Sarah researches information about
C. compounding. different careers.
D. rule of 72. D. Ben performs contract work for his
friend’s new company.
779. The management of a firm’s cash, inven-
784. Also called “rational buying”; Careful
tory, and payables is referred to as:
consideration of the product, features,
A. cash-flow forecasting. price, etc. is made.
B. asset management. A. Opportunity Cost
C. capital management. B. Budget
C. The envelope system
D. working capital management.
D. none of above
780. A statement of a company’s operating
785. Which of the following is the least likely
and financial performance issued at the
source of funds for a non-profit organiza-
end of its fiscal year is a
tion?
A. Annual Report
A. Fund-raising events
B. Balance Sheet B. Charitable donations
C. Income Statement C. Brand recognition
D. Statement of Cashflow D. Sponsorship deals
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 413
786. What is the formula for Gross Profit Mar- C. venture capitalist
gin? D. Owner savings
PRACTICE BOOK» NOT FOR SALE
A. Revenue-Cost of Sales
792. Which of the following statements re-
B. Gross Profit / Revenue garding finance leases is correct?
C. Net Profit / Revenue A. The lessor is normally responsible for
D. Gross Profit x Revenue repairs and maintenance.
B. The lease exists for the whole or major
787. Cost of supplies are increasing month on
part of the asset’s useful life.
month-how could you solve this problem?
C. Ownership of the asset remains with
A. hold a sale and get rid of stock
the lessor.
B. take out a bank loan to cover increas-
D. The lease is essentially the short-term
ing costs
rental of an asset.
C. look for a cheaper supplier
793. A flower seller plans to increase stocks
D. offer customers discounts of plants. Which is the most likely source
788. Which one of the following sources of of finance?
funds is convertible into equity shares? A. bank overdraft
A. Loans from commercial banks B. leasing
B. Inter corporate deposits C. share issue
C. Debentures D. debentures
D. Bonds 794. a steady drop in the stock market over a
period of time
789. Which of the following refers to the ac-
tivity of planning, organizing, monitoring A. operating costs
and controlling financial resources? B. liabilities
A. Financial institution C. bull market
B. Financial instrument D. bear market
C. Financial management 795. Things your company are responsible for
D. Financial market is called
A. Capital
790. A decrease or loss in value
B. Taxes
A. depreciation
C. Liabilities
B. appreciation
D. Assets
C. price ceiling
D. price floor 796. Information ? means that infor-
mation remains unchanged from its source
791. This is the cash that is generated by the and has not been accidentally or mali-
business when it operates successfully ciously modified, altered, or destroyed.
A. Retained profits A. accounts
B. Share capital B. integrity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 414
C. debt C. a budget is financial plan
D. accrual D. a budget looks back and review perfor-
E. solvency mance
797. He/She provides the direction of the com- 802. a financial statement that reports a com-
pany. pany’s revenues and expenses and result-
ing net income or net loss for a specific pe-
A. finance manager
riod of time
NARAYAN CHANGDER
B. board of directors
A. Dow Jones
C. marketing manager
B. operating costs
D. shareholders
C. income statement
798. Which of the following is not an alterna-
D. stock market
tive name for a primary bank?
A. Retail bank 803. What are liabilities?
B. Commercial bank A. The money paid to employees.
C. Merchant bank B. Costs of operating a business.
D. Clearing bank C. The act of buy items.
799. Which of the following is not a limitation D. What a company owes.
of equity share as a source of finance?
804. Cash flow is
A. Fluctuating returns
B. Costly source A. Assets for a business
C. Dilutes the voting power B. Depreciation
D. No explicit cost C. Movement of funds through your busi-
ness each month
800. Local prices of farm goods are negatively
D. Money you entered and existed for a
affected by high importation. Due to this,
certain amount of time
farmers have no choice but to accept the
lowest market prices for their highly per-
805. Directed toward the management
ishable products. What risk is involved in
the situation? A. Personal finance
A. market risk B. Business finance
B. inflation risk C. Capital market
C. credit risk D. Operating decisions
D. reinvestment risk
806. Debentures represent
801. which of the following statements about A. Fixed capital of the company
budgeting is incorrect?
B. permanent capital of the company
A. budget provides direction and coordi-
nation C. Fluctuating capital of the company
B. budget motivates staff D. Loan capital of the company
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 415
807. a plan to be effective should be created 812. It refers to the place where the selling-
using S.M.A.R.T. philosophy. what do buying activity occurs to trade equity se-
S.M.A.R.T. mean? curities such as bonds and stocks, cur-
PRACTICE BOOK» NOT FOR SALE
rencies, derivative securities, notes, and
A. specific, measurable, assignable, real-
mortgages.
istic and time-related
A. Capital Market
B. specific, macro, assignable, realistic,
and time-related B. Financial Institutions
C. smart, measurable, assignable, realis- C. Financial Instruments
tic, and time-related D. Business Finance
D. none of the above
813. Which of the following sources of finance
808. Which of the following is a permanent involves the business requesting a specific
source of finance for a company? sum of money from individuals, usually via
the internet?
A. long-term bank loan
A. Alternative investment market
B. share capital
B. Business angels
C. creditors
C. Venture capital
D. overdraft
D. Crowdfunding
809. What are fixed costs?
814. Which of the following is not a character-
A. costs which vary in line with produc- istic of an effective goal?
tion
A. Realistic
B. costs which stay the same regardless B. Measurable
of production levels
C. Point in time
C. costs incurred by the customer
D. Specific
D. none of above
815. Upon the retirement of his parents, Ian
810. What is the formula for total costs? manages their family business. Then, one
A. Selling price x quantity day her sister asked him if he could include
her husband on their family business. Ian
B. cash inflows-cash outflows was hesitant due to his brother in law crim-
C. opening balance +/-profit/loss inal record like fraud and estafa. What
risk did Ian was trying to avoid?
D. Fixed costs + Variable costs
A. Market Risk
811. If a project that costs $30, 000 brings in
B. Credit Risk
$5, 000 a year, the payback is
C. Liquidity Risk
A. 4 years
D. Operational Risk
B. 5 years
C. 6 years 816. Working capital is calculated by:
D. cannot determine from this informa- A. current assets-fixed assets
tion B. current liabilities-current assets
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 416
C. fixed assets-current assets 822. You were earning Php. 50, 000 from a
Government Agency. After receiving the
D. current assets-current liabilities
said salary, you started to allocate bud-
817. ‘Time delay of the transaction’ is a disad- get for your emergency fund, saving, and
vantage of which method of payment? other expenses. This is an example of?
A. Public Finance
A. Cheque
B. Corporate Fiance
B. Debit Card
C. Family Finance
NARAYAN CHANGDER
C. Cash
D. Personal Finance
D. BACS
823. the amount of money left after operating
818. It describes what a company wants to be- expenses are subtracted from the gross
come. profit
A. vision A. revenue
B. mission B. income
C. net profit
C. goal
D. gross profit
D. objective
824. Long Term sources of finance are for
819. Refers to banks and credit unions. when the time needed to pay the money
A. financial institutions back is more than
A. 6 months
B. businesses
B. 1 year
C. consumers
C. 5 years
D. financial markets
D. 10 years
820. It is a purchase that is completed with 825. higher earnings for businesses increases
money that has the potential to produce thiieir value, which caueses a demand for
income or profit. people wanting to buy the company
A. authority A. game
B. financial B. suplies
C. investment C. stock
D. risk premium D. bond
826. Fill in the blank with the best an-
821. What is a financial institution that ac-
swer:Selling shares in a company in ex-
cepts deposits and channels the money
change for money to fund a project is
into lending activities?
known as
A. Credit A. equity financing
B. Commercial Banks B. stock
C. Credit Unions C. the cash conversion cycle
D. Insurance D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 417
827. Which of the following is not a type of 832. A t-shirt company spend $2.50 for every
investment? shirt they produce. They charge customers
$15.95 on Amazon.com. What is the re-
PRACTICE BOOK» NOT FOR SALE
A. bonds
tail cost?
B. deposit banks
A. $2.50
C. mutual funds B. $15.95
D. shareholder C. $13.45
828. is thecurrent value of an amount of D. $20.45
money to be received at a future date
833. It refers to contracts that give rise to the
based on aspecified investment rate
formation of financial assets of one entity
A. Present Value and at the same time the creation of a fi-
B. Collateral nancial liability or an equity instrument in
another entity
C. Depreciation
A. Capital Market
D. Future Value
B. Financial Institutions
829. What is the formula for Net Profit Mar- C. Financial Instruments
gin? D. Business Finance
A. Revenue / Net Profit
834. one of the three functions of money al-
B. Net Profit / Revenue lowing people to measure the value of
C. Net Profit x Revenue goods and services
D. Revenue-Total Costs A. store of value
B. medium of exchange
830. In which of the following projects would
C. unit of account
a venture capital organisation be least
likely to invest? D. cash
A. A business start-up 835. What is the sixth step in the accounting
B. A management buyout cycle?
A. A trial balance of the accounts is pre-
C. Renovation of a production facility
pared
D. Replacement of an existing production
B. Closing entries are completed
line with a process using a new technol-
ogy C. Adjusting entries are recorded
D. Journal entries are posted in the ap-
831. It is calculated by the formula:Net profit/ propriate accounts
capital employed X 100
E. Financial statements are prepared
A. gross profit margin
836. In what categories of bond issuers are
B. acid test ratio
those issued by government affiliated or-
C. ROCE ganization.
D. none of above A. agency bonds
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 418
B. corporate debt securities 842. Paying rent, purchasing supplies, and
C. government securities paying employees are examples of
D. municipal bonds A. capital
837. Why should you plan expenditure? B. retail costs
A. Payback loans C. operating costs
B. Control pension D. startup costs
NARAYAN CHANGDER
C. To control costs 843. what is sales budget?
D. Pay mortgage
A. a plan items to be sold
838. They are considered owners of the busi- B. a plan of how much an item will cost
ness and have voting rights, entitled to
dividends which depend on their share and C. a plan for how much money should be
earnings of the corporation. They are made in a given period
called D. a plan for tracking an inventory and
A. stockholder how much they sell
B. stakeholder 844. advantage of sale of inventory as a
C. employees source of finance
D. investors A. This source of finance is not available
for a newly formed businesses and un-
839. Also called “emotional buying”; Making
profitable and under profitable firms.
an unplanned purchase.
A. Impulsive Buying B. A good way of raising cash from capi-
tal that may be tied up in assets that are
B. Trade-off not being used
C. Value
C. Must be repaid
D. none of above
D. Reduces storage cost of high inventory
840. What would the finance department use
the internet for? 845. This source of business finance is used for
issue of bonus shares:
A. creating charts
B. presenting information A. Equity Share
C. online banking B. Preference Share
D. calculating profits C. Retained Earnings
841. The financial statement that reports D. Debentures
whether the business earned a profit and
846. When an asset loses value over time it is
also lists the revenues and expenses is
called?
called the:
A. Balance Sheet A. Salvage
B. Statement of Retained Earnings B. Net Loss
C. Statement of Cash Flows C. Depreciation
D. Income Statement D. Dispose
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 419
847. Banco De Oro, Bank of Philippine Island B. Government Banks
and Metropolitan Bank is an example of C. Thrift Banks
?
PRACTICE BOOK» NOT FOR SALE
D. Credit Union
A. Central Bank
B. Commercial Bank 853. Which two features does a basic savings
account have?
C. Investment Bank
A. allows moneytransfers
D. Thrift Bank
B. offers a higherinterest rate
848. Who established IKEA at the age of 17?
C. allows ATMwithdrawals
A. Ingrid Bergman
D. has a maturity date
B. Bella Weems
854. What is the name of the type of capital
C. Ingvar Kamprad
which is obtained by people buying a part
D. Philo Farnsworth of a company?
849. Debentures can best be described as a A. Share Capital
form of B. Spare Capital
A. short-term loan with variable interest C. Owners’ capital
rates
D. none of above
B. Medium-term loan with variable inter-
est rates 855. You have been offered an investment
that promises to double your money ev-
C. Long-term loan with a fixed interest
ery nine years. Considering the rule of 72,
rate
what is your approximate rate of return
D. Long term security giving the holder on the investment?
part ownership of the business
A. 8%
850. What is an advantage of a credit union? B. 9%
A. lower fees C. 14%
B. higher fees D. 10%
C. lower rates
856. It is the borrower’s security pledge for
D. higher rates the loan payment.
851. Wealthy individuals who invest in high- A. character
potential businesses are B. capacity
A. Banks C. collateral
B. Angel Investors D. condition
C. Shareholders
857. Mark is needing to purchase a new van,
D. Crowdfunders which source of finance would you sug-
852. Financial institution controlled by the gov- gest?
ernment. A. bank loan
A. Securities Dealers/Brokers B. mortgage
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 420
C. hire purchase 863. Why have a business plan?
D. debenture A. Describes the nature of your business
858. A rights issue involves the sale of what? B. Explains who will run your business
A. new shares on the stock market C. States how the business will win over
and retain customers
B. fixed assets
D. All of the above
C. new shares to existing shareholders
NARAYAN CHANGDER
D. part of the business 864. An obligation whose maturity is more
than a year. The borrower generally ne-
859. Which three of the following are compo- gotiates with the credit rather than go to
nents of the COSO internal control frame- an investing banker to act as an interme-
work? diary.
A. Information and communication A. Long Term Loan
B. Control environment B. Term Loan
C. Internal audit C. Mortgage Loan
D. Project management D. Short Term Loan
E. Monitoring activities
865. Which of the following financial in-
860. Cash and profit are different because struments are available from commercial
A. some goods are sold on credit banks?
B. owners put more money into their busi- A. Gilts
ness B. Commercial paper
C. the opening balance at the start of the C. Certificates of deposit
year is zero
D. Treasury bills
D. companies might buy fixed assets
866. the amount producers are willing and
861. Which is a characteristic of good customer
able to produce
service?
A. demand
A. Asking many questions.
B. scarcity
B. Offending people.
C. Offering quality service. C. supply
D. Taking a long time to reply. D. inventory
862. Provide assistance to both private and 867. Amounts owed to creditors for goods and
public borrowers of fund services are called
A. Public finance A. a promissory note
B. Capital market B. accounts payable
C. Private finance C. a line of credit
D. Business finance D. commercial paper
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 421
868. I would like to open a bank , B. to facilitate comparison of historical
please.What can I do? data and projections of future perfor-
mance
PRACTICE BOOK» NOT FOR SALE
A. account
C. it helps the company
B. calculate
D. all of the above
C. transfer
D. none of above 874. Which would probably result if a business
reduced its marketing costs?
869. Which of the following is another name A. Increased cost of production.
for an outflow in a cash flow forecast?
B. Decreased variety of consumer goods.
A. Receipt
C. Increased consumer awareness of
B. Payment goods and services.
C. Deficit D. Decreased need for customer contact
D. Surplus with businesses.
870. Which of the following is an example of 875. What is A financial plan?
internal finance for a limited company? A. A plan that lays out your money situa-
A. selling shares tion and what you can and cant do
B. selling debentures B. its the bank
C. obtaining a loan C. The amount of money you have
D. reducing stock levels D. none of above
876. If the business in question 7 sold 100,
871. What is the most likely source of finance
000 units during the year, its variable cost
for buying property?
per unit equalled:
A. Mortgage
A. £0.80
B. Factoring
B. £1.25
C. A bank loan C. £3.00
D. none of above D. £7.50
872. Property or money that has value that is 877. It refers to how much the total asset is
owned by a company. financed by the debt or equity.
A. assets A. capital structure
B. liabilities B. loan
C. startup costs C. organization structure
D. operating costs D. stocks
873. what is the objective of performance fi- 878. The is the amount of money left after
nancial statement a product or service is sold and the costs of
A. to give an idea of how the actual state- goods and other expenses are subtracted.
ment will look like A. Loss
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 422
B. P & L Statment 883. A short-term source of finance from a
C. Profit bank that usually is only used in an emer-
gency/when needed
D. Expense
A. Overdraft
879. Debentures represents B. Loan
A. Fixed capital of the company C. Share capital
B. Permanent capital of the company D. Credit card
NARAYAN CHANGDER
C. Fluctuating capital of the company
884. What do Angel Investors and Crowdfun-
D. Loan capital of the Company ders have in common?
880. Three basic approaches to performance A. They require something in return for
measures are measures of economy, effi- their investment
ciency, and effectiveness. Economy is mea- B. They charge interest on money in-
sured by vested in the buisness
A. the amount of resources used for the C. They become part-owners of the busi-
tasks that have been achieved ness
B. the success in achieving goals and tar- D. They are incredibly wealthy
gets
885. The ability of an organization to meet its
C. team member satisfaction and the mo-
financial obligations as they become due is
tivational climate
known as ?
D. the success of the team or work group
A. accounts
in controlling its costs
B. integrity
881. Someday plc is introducing a set of per-
C. debt
formance measures in its finance function.
A key measure for the sales ledger part D. accrual
of the system is the number of invoices E. solvency
recorded per hour of employee time. The
point of reference for this performance 886. Public deposits are the deposits that are
measure is: raised directly from
A. productivity A. The Public
B. activity B. The Directors
C. profitability C. The Auditors
D. economy D. The Owners
882. Identifies the assets, liabilities, and eq- 887. Interest would always need to be paid on
uity of a business as of a specific date. which of the following sources of finance?
A. income statement A. A new share issue
B. cashflow statement B. A loan from family and friends
C. balance statement C. A mortgage
D. owner’s equity D. A government grant
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 423
888. Which of the following is NOT a source of B. operating cost
finance. C. liabilities
PRACTICE BOOK» NOT FOR SALE
A. Family & Friends D. bull market
B. Bank Loan
894. A business often needs capital to operate.
C. Sales Revenue
One way to get capital is to
D. Government Grant
A. Borrow money in the form of a loan.
889. Money that is spent on equipment, re- B. Partner with someone who will invest
sources, or supplies is referred to as money.
A. Business income C. Both choices
B. Personal expenses D. Neither choices
C. Proft and loss
895. If you hear the word “finance”, what
D. Business expenses comes into your mind?
890. equity shareholders are called A. bank
A. owner of the company B. treasurer
B. partner of the company C. money
C. executives of the company D. ATM
D. guardian of the company 896. What is a management plan?
891. ‘An easy way to make regular payments A. A plan that shows how you want your
that vary in amount i.e. utility bills’ is an business to be managed and the things
advantage of which method of payment? that your gonna do to get it done
A. Standing Order B. its the same as the business plan
B. Direct Debit C. theres no such thing
C. Cheque D. none of above
D. Electronic Transfer
897. Involve the acquisition and construction
892. It is the amount of cash that the firm of building, machineries, pland, land
needs to maintain at all times at its A. Financial investment
present level of operations, cash flows sta-
B. Financial expenditures
bility, and the political and macro economic
conditions. C. Public finance
A. target cash balance D. Operating decision
B. cash budget 898. A financial report showing the result of
C. cash reeceipts operation at a given period of time is
D. operating budget A. Statement of Cash Flow
893. a period of increased stock trading and B. Statement of Financial Position
rising stock prices C. statement of Comprehensive Income
A. bear market D. Statement of Equity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 424
899. Which current account is most appropri- B. £325, 000
ate for receiving regular payments and
C. £450, 000
bills?
A. Standard D. £625, 000
B. Packaged, premium 904. Which of the following statements about
C. Basic bank loans is not true?
D. Student A. Usually used for large amounts of
NARAYAN CHANGDER
money that need to be paid back over a
900. advantage of retained profit as a source longer time-frame
of finance
B. Interest rates make the loan more ex-
A. This source of finance is not available
pensive
for a newly formed businesses and un-
profitable and under profitable firms. C. Easy to get
B. A good way of raising cash from capi- D. Usually cheaper than consistently us-
tal that may be tied up in assets that are ing a bank overdraft
not being used
C. Doesn’t have to be repaid 905. Which is a feasible investment risk?
D. Reduces storage cost of high inventory A. Mark promises investors that he can
double their money in 10 years.
901. Which of the following is not a service
provided by financial institutions. B. Mark promises investors that no loss
will be incurred in 10 years.
A. Buying the businesses of customers
C. Mark does not promise that the invest-
B. Investing customers’ savings in stocks
ment would grow as much as 10% but will
and bonds
depend on market situations.
C. Paying savers’ interest on deposit
D. All of the above
D. Lending money to customers
906. It is the ability of a business to pay long
902. An advantage that an overdraft has over
term liabilities.
a bank loan is that:
A. it has a fixed rate of interest A. Liquidity
B. it is paid back over a fixed time period B. Solvency
C. no dividends have to be paid to share- C. Profitability
holders as with a loan
D. Stability
D. the size of the overdraft varies with the
needs of the firm 907. Which one of the following are financial
institutions?
903. Last year, a business made £300, 000
profit from sales revenue of £750, 000. A. bank and credit union
Its total variable costs equalled £125, B. library and hospital
000. The value of the business’s fixed
costs was: C. school and museum
A. £175, 000 D. Starbucks and Wal-Mart
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 425
908. This type of budget gives some expected 913. the way in which nations make decisions
sales revenue and expenses and selling for to allocate their resources
the organization for a specific period of
PRACTICE BOOK» NOT FOR SALE
A. economy
time.
B. scarcity
A. Cash Flow Budget
C. opportunity cost
B. Operation Budget
D. financial decisions
C. Production Budget
914. Which of the following best describes
D. Sales Budget working capital?
909. what does GDP stand for A. Capital needed for capital expenditure
A. gallons per say B. Capital needed to start a business
C. Capital spent on wages
B. Glass Processing Days
D. Capital needed for day to day expendi-
C. Generalized Probabilistic Descent ture
D. gross domesticated product
915. Sales have been decreasing for several
910. It is a type of financial intermediary that months now-what would you advise the
pools savings of individuals and makes business does?
them available to business and govern- A. look for a cheaper supplier
ment users. Funds obtained through the B. hold a sale to encourage customers to
sale of shares. shop
A. Mutual Funds C. take out a bank loan
B. Commercial banks D. open up a new shop
C. Savings and loans
916. what is given up when making one choice
D. Credit Union instead of another
A. scarcity
911. It demonstrates the solvency of a busi-
ness on a month-to-month basis or even B. economics
more frequently. C. opportunity cost
A. Balance Sheet D. market
B. Annual Report 917. What are the basic function of Financial
C. Income Statement Manager?
D. Statement of Cash Flow A. Investment / Financial / Dividend De-
cision
912. What is the formula for Net Profit? B. Capital / Investment / Financial Deci-
A. Revenue-Total Costs sion
C. Budgeting / Investment / Dividend De-
B. Revenue-Cost of Sales
cision
C. Cost of Sales-Total Costs
D. Financial / Performance / Budgeting
D. Fixed costs + Variable Costs Decision
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 426
918. Fill in the blank with the best an- 923. What are assets?
swer:Dividends can be paid in the form of
A. What a company owns; anything of
cash or
value owned by a business.
A. equity financing
B. Costs of operating a business.
B. stock
C. Detailed plans for the financial needs
C. the cash conversion cycle of individuals, families, and businesses.
D. none of above D. Differences between actual and bud-
NARAYAN CHANGDER
geted performance.
919. Which institutions regulates the financial
sector? 924. A business is likely to have sufficient
A. The Ministry of Finance working capital if the current ratio is be-
tween?
B. The Security and Exchange Commis-
sion A. 0 and 1
C. The Central Bank B. 1 and 2
D. The Banker’s Union C. 1.5 and 2
920. In which life stage will you most likely be D. 2 and 3
making regular mortgage payments?
925. What is the purpose of a Business Plan?
A. Childhood
A. Gain Potential Investors
B. Adolescence
B. Determine Needs
C. Young Adult
C. Organize and Plan a Business
D. Middle Age
D. All of the above
921. It represents anything that a firm pur-
chases on credit. 926. Which of the following institutions is re-
sponsible for trading government securi-
A. credit payable ties?
B. firms payable A. Bangko Sentral ng Pilipinas
C. accounts payable B. Bureau of Treasury
D. none of above C. Department of Finance
922. Under the factoring arrangement, the fac- D. Philippine Stock Exchange
tor:
927. A firm has applied for a bank loan. The
A. collects the clients’ debt or account re-
manager will ask all of the following ques-
ceivables
tions except:
B. makes the payment on behalf of the
A. How big is the loan needed?
client
B. How liquid is the business?
C. transfer the goods from one place to
another C. How long will the loan be needed for?
D. produces and distributes the goods or
services D. How powerful are the computers?
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 427
928. a market in which currencies of different 933. The amount paid for the privilege of bor-
countries are bought and sold rowing money is called
PRACTICE BOOK» NOT FOR SALE
A. federal reserve bank A. interest
B. foreign exchange market B. rate of return
C. international business finance C. cash flow
D. foreign bank D. operating budget
929. Which two of the following statements 934. Which of the following statements con-
best describe the term break even? Select cerning preference shares is correct?
two answers:The point where:
A. Preference shares carry the same vot-
A. The business is just making a profit ing rights as ordinary shares
B. Total revenue and total fixed costs are B. Preference shares carry the right to a
the same fixed rate of dividend each year
C. The business is making neither a profit C. The payment of a preference share div-
or loss idend is guaranteed each year
D. Total costs are higher than total rev- D. Preference shares are always a type
enue of debt capital
E. Total revenue and total costs are equal
935. Examples may include salaries, utilities,
930. If Wal-Mart wanted to build a new store, rent, insurance, and office supplies.
which bank would they most likely go to A. Revenue
get a loan.
B. Expense
A. Commercial bank
C. Net Income
B. Retail bank
D. Net Loss
C. Central bank
D. Loan company 936. What is start up capital?
A. Finance needed before starting trad-
931. Euity shareholders are called? ing.
A. Owners of the company B. Finance paid after trading.
B. Partners of the company C. Finance paid to banks.
C. Excecutives of the company D. none of above
D. Guardian of the company
937. the system of governing a company so
932. Which of the following is a source of long- that the interests of corporate owners and
term finance? other stakeholders are protected
A. Trade credit from suppliers A. corporate responsibility
B. Bank overdraft B. opportunity cost
C. Factoring of trade debts C. scarcity
D. Mortgage on property D. corporate governance
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 428
938. which of the following is normally pre- 944. Business must have permits and fol-
pared first? low industry specific regulations. This
A. cash budget means?
B. production budget A. Ensuring Compliance and Financial Re-
quirements
C. sales budget
B. Tracking Liquidity and Financial Re-
D. none of the above quirements
939. The United States operates within what
NARAYAN CHANGDER
C. Developing Financial Scenarios
type of economic system?
D. Applying for Permit and Financial Re-
A. Command quirements
B. Traditional
945. which of the following service provided
C. Market by financial institutions?
D. Mixed A. buying the business of customers
940. Expenses are those items that are: B. investing customers savings in stocks
A. Direct costs for producing goods and bonds
B. Costs associated with operating a busi- C. paying savers interest on deposit
ness funds
C. All the company outflows D. lending money to customers
D. none of above 946. The working capital of a business is given
by
941. What is the finance department responsi-
ble for? A. Capital employed
A. looking after employees B. net assets
B. communicating with customers C. non-current assets
C. manufacturing the products D. net current asset
D. managing the business finances 947. It is a type of bank that provides services
such as accepting deposits, making busi-
942. Which of these sources of finance is inter-
ness loans, and offering basic investment
nal?
products that is operated as a business for
A. crowd funding profit.
B. venture capital A. Commercial Bank
C. mortgage B. Universal Bank
D. retained profit C. Thrift Bank
943. Variable Expenses are D. Investment Bank
A. Change month to month, like food or 948. Fill in the blank with the best an-
clothes swer:Finance is the business function that
B. Money for a house payment involves decisions about money
C. Occurs only once a year A. management
D. Food B. accounting
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 429
C. investments C. Want
D. none of above D. none of above
PRACTICE BOOK» NOT FOR SALE
949. What is the definition of a fixed cost? 955. These refer to cash, accounts receivable,
inventories, and prepaid expenses.
A. A cost that varies with output
A. current assets
B. A cost that does not vary with output
B. noncurrent assets
C. Costs that do not change
C. current liabilities
D. Costs that change only when agreed
D. owner’s equity
950. What is the first step of the capital bud-
geting process? 956. Which is an external factor that affects
market price?
A. determine potential projects
A. Location of items in store.
B. forecast cash flows
B. Consumer buying power.
C. identify cost of capital and risks
C. Number of items in stock.
D. set capital spending goals
D. Available credit terms.
951. What is the definition of a variable cost?
957. economic principle requiring that people
A. Costs that vary with output decide which goods and services to use or
B. Costs that do not vary with output not use due to limited resources and unlim-
C. Costs that are always changing ited wants
D. Costs that cannot change A. economics
B. scarcity
952. the value of a currency in one country
compared with the value in another C. opportunity cost
D. supply
A. store of value
B. medium of exchange 958. It refers to the minimum level of current
assets required by a firm to continue the
C. unit of account
operation of the business and to cover up
D. exchange rate all current liabilities.
953. The wealth of the owners of a corpora- A. net working capital
tion is represented by B. temporary working capital
A. profits C. working capital
B. earnings per share D. permanent working capital
C. share value
959. These are current assets used in the op-
D. cash flow erations of the business.
954. Income that is not consistent or is not the A. working capital
same amount each pay period B. net working capital
A. Budget C. temporary working capital
B. Irregular Income D. permanent working capital
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 430
960. What is the definition of expenses? 965. the ability of individuals to start new
businesses, introduce new products, and
A. The money from selling goods and ser-
improve business processes
vices
A. marketing
B. Cash you are spending in the business
B. entrepreneurship
C. Costs of running the business
C. land
D. The outgoings relating specifically to
vehicles D. labor
NARAYAN CHANGDER
966. ‘Payment is transferred directly from one
961. Specific financial goals are vital to finan-
bank account to another’ describes which
cial
method of payment
A. spending
A. Electronic Transfer
B. planning
B. Credit Card
C. goals C. Direct Debit
D. values D. Standing Order
962. A mission statement expresses the 967. What type of budgets provides informa-
A. basic purpose and vision the founders tion regarding the number of units that
have for the business should be produced over a given account-
ing period based on expected sales and tar-
B. specific aspirations of a company and geted level of ending inventories?
the goals it will try to reach
A. Cash Flow Budget
C. gives them a day to day purpose in
B. Financial Budget
their business
C. Production Budget
D. value that the main goal of every busi-
ness is make a profit D. Sales Budget
963. The important information contained in- 968. Which of the following is a permanent
cludes the company’s total assets, liabili- source of finance?
ties, and owner’s equity and how each cat- A. long term loan
egory is divided. B. retained profit
A. Balance Sheet C. overdraft
B. Annual Report D. sale of stock
C. Income Statement
969. It is composed of collections from receiv-
D. Statement of Cash Flow ables, proceeds from loans, isusuance of
new shares of stock, and advances from
964. Which services is a bank likely to offer? the stockholders.
A. net deposit and balance A. Cash receipts
B. online banking and savings accounts B. net cash flow
C. check writing and car wash C. sales revenue
D. credit card and Tootsie Rolls D. cash budget
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.6 Business Finance 431
970. Expenses are B. Financial Statement Analysis
A. Cost your company incurs each month C. Vertical Analysis
PRACTICE BOOK» NOT FOR SALE
B. Things your company is responsible for D. Diagonal Analysis
C. Net profit
976. Sales and the costs to generate those
D. Economic Resources sales, other sources of revenue, and all
operating, administrative, and other busi-
971. It represent monetary assets that have ness expenses are detailed in a
contractual agreement between parties.
A. Statement of Cash Flow
A. Securities
B. Balance Sheet
B. Deposits & Loan
C. Income Statement
C. Forward
D. Annual Report
D. Options
977. Which are advantages of Trade Credit?
972. In which life stage will you need encour-
agement to start saving money? A. Little penalty for late payment
A. Childhood B. No interest if paid on time
B. Adolescence C. Discount for quick payments
C. Young Adult D. Little trust loss if not paid on time
D. Middle Age 978. Which of the following is a function of fi-
973. A sole trader wants to increase the stock nancial regulators?
of products in his shop. The best source of A. The provision of financial advice and in-
finance is likely to be: formation to businesses
A. a long term bank loan B. Reduction of risk for clients via aggre-
B. trade credit gation of funds
C. debentures C. Maturity transformation
D. mortgage D. Prudential control of financial institu-
tions
974. You borrowed Php. 20, 000 from ABC
Bank. After a month the amount due to 979. Overheads are defined as;
bank is now Php. 25, 000. The Php. 5, A. The start up costs of a business
000 difference is known as?
B. The everyday running costs of a busi-
A. Charge ness
B. Interest Rate C. The variable costs of a business
C. Payment Due D. The fixed costs of a business
D. Debt
980. Your financial goals can range from
975. The process of comparing amounts in the spending all of your current income to de-
financial statements of two or more con- veloping an extensive savings and invest-
secutive periods. ment program for your future financial
A. Horizontal Analysis A. freedom
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 432
B. goal A. money
C. security B. mortgage
D. needs C. loan
981. I took out a to buy a house last year. D. none of above
1.7 Business Statistics and Research Methods
NARAYAN CHANGDER
1. Which of these situations could cause bi- B. Third
ased data? C. Primary
A. Asking family and friends D. Tertiary
B. Asking a small sample of people
6. This type of data coming from research an-
C. Asking the opinions of people from dif- swers questions such as “how many? ”
ferent backgrounds and “ how much? ”.
D. Asking your staff’s opinions face-to- A. Research Data
face
B. Quantitative Data
2. What is the total for the following- C. Number Data
Breakeven calculation *Fixed costs
D. Qualitative Data
£1200*Variable costs £15*Selling price
£20 7. Degree of agreement with a statement on
A. £240 a 1 (strongly agree) to 5 (strongly dis-
agree) scale is a scale.
B. £25
A. Staple
C. -£240
B. Continuous rating
D. £2000
C. Likert
3. What is an example of secondary re- D. Semantic differential
search?
A. Focus Group 8. Which of these describe quantitative re-
search?
B. Observation
A. questions asking “how? ”
C. Newspaper
B. questions asking “how much? ”
D. Questionnaire
C. attitude research
4. Name 2 variable costs-Give 2 examples D. questions asking “why?
A. Stock
9. Which of the following is MOST likely
B. Packaging to occur when a partner leaves the busi-
C. Insurance ness?
D. Loan Repayment A. The remaining partners continue the
business
5. The Sectors of Industry are B. A new partner is brought into the busi-
A. Secondary ness
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 433
C. The partnership will come to an end D. Disorganised
D. The business becomes a sole trader E. Irresponsible
PRACTICE BOOK» NOT FOR SALE
10. The field of operations management is 15. Alexa’s Boutique decided to change their
shaped by advances in which of the follow- logo so that it would stand out and appeal
ing fields? more to their target market. Which func-
A. chemistry and physics tion of marketing is this?
B. industrial engineering and manage- A. Product
ment science B. Financing
C. biology and anatomy C. Pricing
D. information technology D. Selling
E. all of the above
16. The Ten Critical Decisions of Operations
11. How can people take attitude research? Management include
A. economic forecasting A. Layout strategy
B. advertisement recall B. Maintenance
C. mail surveys C. Process and capacity design
D. sales forecasting D. Managing quality
E. all of the above
12. Enterprise is
A. Seeing an opportunity (gap in market) 17. All of the following are advantages of a
for a product/service that people are will- survey EXCEPT:
ing to buy. A. data collected is always honest and re-
B. Starting your own business. liable
C. Getting investment. B. quick
D. Forming a partnership. C. easy to analyze
D. can collect data on large samples
13. Which of the following is NOT a primary
reason for an individual to establish a busi- 18. Which of the following are ways that new
ness? business ideas can be generated
A. Desire for financial independence A. A new idea/invention
B. Self-actualisation B. Using obsolete products
C. Self-fulfillment C. Adapting existing ideas (improve-
D. Contributing to nation building ments/changes)
14. Which two of the following are most likely D. Copying an existing product from an-
to be characteristics of a successful en- other company
trepreneur? 19. Which of these are ways you can segment
A. A risk taker a market?
B. motivated A. Age
C. Indecisive B. Demographics
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 434
C. Lifestyle C. Making a mark on a product with a hot
D. Market Mapping iron
E. Opening Hours D. Communicating with customers about
products through the mai
20. What factors make a business riskier than
others? 24. Which of the following would be effective
A. Seasonal Demand (i.e. ice cream) in attracting and retaining customers in a
mobile phone sales franchise?
NARAYAN CHANGDER
B. Being in a highly competitive market
A. A delivery fee is charged on all new
C. Having an owner with lots of experi- phones
ence
B. A single brand of phone is sold
D. Having the support of a franchisor
C. An extended warranty is offered on all
E. Being in a large market
phones
21. Which of the following best describes the D. Phone sales are by appointment only
main purpose of sampling?
A. To enhance the reliability of measure- 25. In the product life cycle identify what the
ments. DIGMD stands for focusing on the D-Select
2 answers
B. To enhance the validity of measure-
ments. A. Decline
C. To validate the theoretical concepts B. Development
used in a study.
C. Divided
D. To select a set of elements with the
D. Distribution
same characteristics as the population
from which they are chosen. 26. Strongly agree to strongly disagree is an
22. Which of the following are most likely example of a scale frequently used on
to differentiate a supermarket from its ri- surveys.
vals? A. Score
A. Have longer opening hours B. Likert
B. Stock food that isn’t normally available C. Simile
in the UK
D. Predictor
C. Provide currency exchange services
D. Decrease import tariffs 27. Which is a reason why it is important to
E. Expanding onto a new site organize information before preparing a
business report?
23. Which one of the following is the correct A. to investigate the cause of the problem
definition of ‘branding’ in a businesscon-
text? B. to understand the purpose of the re-
port
A. Sales staff presenting the benefits of a
product to potential customers C. to arrange findings in a logical manner
B. Giving a product a distinctive name to
make it stand out from other products D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 435
28. Which of the following would not be an B. researchpapersforsale.com
operations function in a fast-food restau- C. Owl.english.purdue.edu
rant?
PRACTICE BOOK» NOT FOR SALE
D. writegood.com
A. advertising and promotion
B. designing the layout of the facility 33. There are many advertising methods. Se-
lect 2 which would be good to attract a
C. maintaining equipment younger audience.
D. making hamburgers and fries A. Leaflets
E. purchasing ingredients B. Social Media
29. Which of the following would be the most C. Websites
suitable place for a large public limited D. Radio
company to advertise for a senior direc-
tor? 34. Reasons to study Operations Management
A. National newspaper include learning about
B. Job centre A. why people organize themselves for
productive enterprise
C. Staff noticeboard
B. how goods and services are produced
D. Company intranet
C. what operations managers do
30. Why are focus groups used? D. a costly part of the enterprise
A. To bring together a group of people to E. all of the above
discuss a particular product or issue
B. All of them 35. Maddie is creating a survey to determine
student’s favorite place to shop. This type
C. It enables open ended questions of research is:
D. It can generate ‘rich’ information A. Primary
rather than a standard response
B. Secondary
31. Which of the following is a reason C. Sales
that some marketers choose to outsource
marketing-research activities: D. Product
A. It is inexpensive to outsource 36. Which of the following is not one of The
marketing-research activities Ten Critical Decisions of Operations Man-
B. Professional marketing researchers agement?
have subjective mindsets A. Layout strategy
C. Marketing-research activities are too B. Maintenance
difficult for most marketers C. Process and capacity design
D. A marketing-research firm can make D. Mass customization
the research anonymous
E. Supply chain management
32. What website did Mr. Lowney say was
an excellent source for helpful information 37. An Internet search is an example of
about writing? A. Secondary research
A. Wikipedia B. Qualitative research
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 436
C. primary research D. Training may be required to update em-
D. Quantitative research ployees on the use of digital communica-
tion
38. Which ONE of the following forms of pay- 43. Which one of the following is a disadvan-
ment is considered legal tender? tage of providing a niche product or ser-
A. Cheque vice?
B. Bank note A. Less competition than for a mass mar-
ket product
NARAYAN CHANGDER
C. Credit card
B. Low scale production can be flexible
D. Debit card
and responsive to change
39. Leadership style that listens to employees C. Demand may be affected by changes
and encourages their opinions. in trends and fashions
A. Democratic D. May be possible to charge a premium
price
B. Laissez Faire
C. Autocratic 44. Using someone else’s work to help you
without their permission is:
D. Paternalistic
A. Plagiarism
40. Using market research to make informed B. Periodical
decisions will help a business to C. Research
A. making high profits D. Sight
B. avoid costly mistakes
45. A brand is
C. lose money A. A sign or symbol
D. reduce risks B. An image
41. What are the 4 P’s of the Marketing Mix C. A named product that is seen as differ-
ent to other products
A. Production, Promotion, Place and
Price D. A combination of letters and images
B. Product, Price, Place and Promotion 46. This term is used to describe a payment
system when people get paid according to
C. Profit, Price, Production and Promo-
what they produce?
tion
A. Piece rate pay
D. none of above
B. Pay per product
42. Which of the following is an advantage C. Commission
to a business of using digital communica-
D. Pay for what you make
tion?
A. Messages and data can be transmitted 47. Define dividend
quickly A. A monetary return on shares
B. Not all areas may be connected to the B. divide the end
internet C. splitting the market into groups
C. Can lead to excessive communication D. Merging two businesses
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 437
48. A type of share which has a fixed rate of 53. The order of priority for payment of re-
interest and is payable whether profits are turns on investments in a public company
made or not includes: is
PRACTICE BOOK» NOT FOR SALE
A. preference shares A. preference shareholders, ordinary
shareholders, debenture holders
B. debentures
B. debenture holders, preference share-
C. cumulative preference shares
holders, ordinary shareholders
D. participating preference shares
C. annuity holders, preference sharehold-
49. how do you calcualte total costs? ers, ordinary shareholders
A. revenue x sales price D. preference shareholders, ordinary
shareholders, annuity holders
B. total variable costs + fixed costs
C. fixed costs x variable costs 54. Henry Ford is noted for his contributions
to
D. profit + variable costs
A. standardization of parts
50. Which of the following pricing strategies B. statistical quality control
describes when a product is priced at
C. assembly line operations
£4.99 rather than £5.00 to give the buyer
the impression they are getting a good D. scientific management
deal. E. time and motion studies
A. Loss Leader
55. A characteristic of a sole proprietorship is
B. Cost Plus Pricing that the owner
C. Psychological Pricing A. has access to unlimited funds.
D. High Pricing B. receives all the profit.
51. What is a hire purchase? C. transfers all the risk.
A. Buying an item and paying in full D. delegates all functions.
B. Not buying an item 56. What is the formula for break even
C. Buying an item now and paying for it at A. Fixed costs / contribution
a later date B. Fixed costs / selling price
D. none of above C. Variable costs / selling price
52. Herbie is in charge of the company’s D. Fixed costs / margin of safety
potluck picnic. He doesn’t need help de-
57. Reasons to study Operations Management
ciding who to invite. It is a company picnic
include
so you invite the employees. This is an
example of what type of decision? A. studying why people organize them-
selves for free enterprise
A. Minimum Input
B. knowing how goods and services are
B. Video Input
consumed
C. Moderate Input C. understanding what human resource
D. Maximum Input managers do
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 438
D. earning about a costly part of the en- C. the person to whom a worker can com-
terprise plain
E. all of the above D. the extent to which an individual must
follow orders
58. When two or more people come together
to fulfill a single job role this is called: 63. Which of the following is NOT a reason
A. Part time employment why exploratory research is conducted?
B. Job sharing A. Screening alternatives
NARAYAN CHANGDER
C. Zero hours contract B. Discovering new ideas
D. Full time employment C. Prospecting for clients
D. Diagnosing a situation
59. Which of the following describes the role
of an entrepreneur? 64. Production in the developed world is char-
A. Being employed by a large organisa- acterised by a greater reliance on equip-
tion ment than labour. This can best be defined
as
B. A willingness to take risks
A. capital intensive production
C. Having sufficient money to start a new
business B. automation
D. Being able to work alone C. mechanisation
D. industrialisation
60. What is a problem with using secondary
data? 65. Individuals who are able to defend their
A. It is easy to find ideas objectively provide others with:
B. It is normally quicker to find A. personal opinions.
C. You did not create it (it might be unre- B. emotional information.
liable) C. logical evidence.
D. You have to find the information your- D. unrelated statistics.
self
66. Budgeting is beneficial to an individual to
61. A sample is a of people who are to ensure that:
respond to a market research exercise.
A. Expenditure is greater than revenue
A. sample, sampled
B. Wants are satisfied before needs
B. packet, asked
C. Priorities are catered for as well as
C. group, selected savings
D. group, sampled D. All incomes are spent
62. The ‘chain of command’ in a business or- 67. Identify the aims of a charity.
ganisation refers to
A. To make profit
A. the channels in which information is
transmitted from the top to bottom B. To satisfy customers
B. the number of subordinates a supervi- C. To raise funds and awareness
sor has control over D. To survive
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 439
68. Jon can only afford to pay £150 in inter- 73. APR Enterprises has taken responsibility
est per year. Calculate the highest interest to refurbish and upkeep a playground in
rate that Jon can afford to pay on a loan the area. Which responsibility is the busi-
PRACTICE BOOK» NOT FOR SALE
of £2400. ness satisfying?
A. 17% A. Its responsibility to shareholders
B. 6.25 B. its responsibility to customers
C. 6.25% C. its responsibility to society
D. 8.25% D. its responsibility to the state
69. Most homemakers cater for their future 74. What is a disadvantage of a bank over-
needs by planning their income and ex- draft?
penses over a period. This can be referred A. It is easy to arrange
to as
B. Daily charges and/or interest can ap-
A. budgeting ply
B. planned spending C. It can take a long time to set up
C. planned savings D. There are no extra charges
D. autonomous expenditure
75. Operations management is applicable
70. Which type of research combines both A. mostly to the service sector
quantitative and qualitative research?
B. to services exclusively
A. surveys
C. mostly to the manufacturing sector
B. opinion research
D. to all firms, whether manufacturing
C. market intelligence and service
D. questionnaire E. to the manufacturing sector exclu-
sively
71. SWOT stands for
A. Social Awareness Talents 76. Which of the following descriptive statis-
tics is most appropriate for describing ra-
B. Social Weakness of Threats
tio data?
C. Strengths, Weakness, Opportunities,
A. Mean
Threats
B. Median
D. None of the abobe
C. Mode
72. The person most responsible for populariz- D. Range
ing interchangeable parts in manufacturing
was 77. A restaurant has created a new pizza
A. Frederick Winslow Taylor dough recipe for their pizzas. Which ONE
of the following is a legal issue they need
B. Henry Ford to consider to protect their new pizza
C. Eli Whitney dough recipe?
D. Whitney Houston A. Business plan
E. Lillian Gilbreth B. Discrimination
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 440
C. Inflation B. Requires substantial financial invest-
D. Patent ment
C. Research data may not be up-to-date
78. Which of the following are the primary
functions of all organizations? D. Specialist training and skills required
to conduct effectively
A. operations, marketing, and human re-
sources 83. An agreement where a franchisor grants
B. marketing, human resources, and fi- another party (the franchisee) the right to
NARAYAN CHANGDER
nance/accounting use its trade-name. For example, most
C. sales, quality control, and operations petrol stations use a franchise agreement.
D. marketing, operations, and fi- A. Limited Liability
nance/accounting B. Franchise
E. research and development, fi- C. Partnership
nance/accounting, and purchasing
D. Sole Trader
79. Which of these pieces of information
would NOT be in a business plan put to- 84. Primary sources of information in conduct-
gether by a new business? ing research refers to
A. Target market A. Collating the information available
B. Market research from business records
C. Profit B. The use of published data
D. Estimated cashflow C. Getting first-hand information from
the business
80. Which of the following is an example of a
specialty contract? D. Government statistics
A. Assignment of copyright 85. This is a set of procedures and meth-
B. Purchase of a good for cash ods that regularly generates, stores, ana-
lyzes, and distributes information for mak-
C. Hire purchase agreement
ing marketing decisions
D. Mortgage
A. Consumer Management System
81. Which two of the following are methods B. Marketing Information System
of adding value?
C. Tickler File System
A. Satisfying shareholders
D. Relationship Management System
B. Unique selling point
C. Suppliers paid on time 86. Why is it important for businesses to store
D. Branding information for future use?
E. Pressure groups A. To establish quality control
B. To protect if from overuse
82. Which is a disadvantage of secondary mar-
ket research? C. To interpret data
A. Time consuming to collect and analyse D. To make it accessible
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 441
87. An interview with a group of potential cus- 92. Business exist to:
tomers who provide valuable feedback. A. Provide quality goods to people who
PRACTICE BOOK» NOT FOR SALE
A. Survey can afford them
B. Focus group B. Sell goods to a particular target audi-
ence
C. Observation
C. Meet the needs of all of their cus-
D. none of above
tomers
88. Which of the following is not an element D. Research ways to make products bet-
of the management process? ter
A. controlling E. Increase the amount of tax collected
B. leading by the Government
C. planning 93. Which is not a tool that people use when
participating in discussions?
D. pricing
A. Pointing out missing information
E. staffing
B. Sharing a personal experience
89. A “good” sample is said to have which of
C. Building on someone else’s comment
the following characteristics?
D. Helping the group summarize what has
A. Identifies the probability that a unit of
been said
analysis will be included in the study
B. Enables decisions concerning sample 94. Marketers look for internal data in
size requirement A. trade association reports
C. Enables quantification of the degree of B. informal interviews
confidence made from inferential statis-
C. the organization’s information system
tics
D. government databases
D. All of the above
95. When Steven asks questions in an open-
90. What are benefits of adding value?
minded way, he avoids:
A. Can charge higher prices
A. stating his own opinion.
B. More competitive
B. attacking someone else’s idea.
C. Impressing your family and friends C. suggesting a better way to do some-
D. Convenience thing.
E. Meeting customer needs D. mentioning the truth.
91. Which is part of the marketing mix 96. A disadvantage of market segmentation is
A. Product
A. Making different product variants for
B. People
different segments is expensive
C. Plans
B. It will lead to products better suited to
D. Advertisinf customer needs
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 442
C. It will reduce marketing costs by not D. Transports products to customers
targeting unprofitable segments
102. This external factor looks at the trends
D. It helps businesses avoid entering and beliefs of the customer.
overly-competitive markets
A. Political
97. What type of information is it acceptable B. Social
to leave out of a job application?
C. Economic
A. Salary requirements
NARAYAN CHANGDER
D. Competition
B. Educational background
C. Personal data 103. Which of the following is an advantage
of using market segmentation?
D. Professional experience
A. It allows a business to charge higher
98. Which of the following documents would prices
contain information about holiday entitle-
B. It lets a business invest more in plant
ment, hours of work, place of work, remu-
and machinery
neration package and duties at work?
C. It saves business money by avoiding
A. Job description
the need for TV advertising
B. Job analysis
D. It allows a business to target its pro-
C. Application form motional strategy more effectively.
D. Contract of employment
104. This type of innovation occurs when the
99. What type of question is the follow- purpose of a product is changed.
ing:“I’m going to show you a sample of a A. Product Innovation
magazine advertisement. What does this
B. Position Innovation
advertisement mean to you? ”
C. Process Innovation
A. Open-ended
D. Paradigm Innovation
B. Closed-ended
C. Dichotomous 105. Business research helps organizations by
D. Multiple choice A. providing information about employ-
ees and morale problems.
100. Which of the following are categories
B. improving efficiency with tools such as
which target markets can be divided into?
sales forecasts.
A. Age
C. analyzing data that point to business
B. Gender opportunities.
C. Lifestyle D. all of the above.
D. All 3 of the other answers
106. Who among the following is associated
101. Market segmentation: with contributions to quality control in op-
A. Divides customers into sub groups erations management?
B. Is a method of promotion A. Charles Babbage
C. Is a qualitative form of market re- B. Henry Ford
search C. Frank Gilbreth
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 443
D. W. Edwards Deming 111. A pressure group is best described as a
group of people that seek to influence:
E. Henri Fayol
PRACTICE BOOK» NOT FOR SALE
A. Business behaviour
107. Which of the following protects employ-
B. Government policy
ees from liability when they administer
first aid to customers? C. Legislation
A. Worker’s compensation D. All of the above
B. Good Samaritan Law 112. This is the amount of money available for
C. Occupational Safety and Health Admin- the day-to-day running of a business.
istration A. Venture Capital
D. Health and Human Services Depart- B. Working Capital
ment
C. Share Capital
108. Research conducted to solve a particular D. Loan Capital
problem is known as
E. Microfinance
A. Pure research
113. A list of question to ask customers to find
B. Basic research
out information.
C. Applied research
A. Survey
D. None of the above
B. Secondary data
109. Which question isn’t collecting qualita- C. Focus group
tive data?
D. none of above
A. do you like chocolate or vanilla, -yes or
no? 114. Which of the following may be a reason
for a small business to complete market
B. why should phones be banned during research?
school?
A. To advertise for a new sales manager
C. describe the kind of toppings do you
like on your pizza? B. To aid decision-making about their
product
D. how should you discipline a child?
C. To help track stock levels
110. One of the main reasons for doing a re- D. To inform staff of changes to their
search proposal is product
A. to start the final report early
115. Raw materials are purchased and labour
B. to allow the client to choose the proper is employed refers to:
research design
A. Process
C. to present the problem and its impor-
tance to the researcher B. Output
C. Input
D. to force the client to accept the
project. D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 444
116. Which of the following ARE methods of B. Partnership
market research? (select as many as you C. Franchise
think are appropriate)
D. Sole Trader
A. Questionnaires
B. Product Tests 122. Zaxbys advertises through social me-
dia, billboards, and television commercials.
C. Books Which marketing function is this?
D. Online searchs A. Pricing
NARAYAN CHANGDER
117. What is database marketing also called? B. Financing
A. CRM C. Promotion
B. BTS D. Product
C. CMR 123. Which of the following is an example of
D. TRH secondary research?
A. Customer survey
118. An ‘M’ (Male) or ‘F’ (Female) in a de-
mographic section of a questionnaire rep- B. Focus group
resents a: C. Market report
A. Categorical variable D. Observation
B. Unknown variable
124. How do entrepreneurs benefit the econ-
C. Dependent variable omy?
D. Continuous variable A. By creating jobs
119. A focus group was held by a research firm B. By paying tax to the government
to determine how consumers felt about the C. By exploiting workers overseas
advertisement message. What type of re-
D. By taking risks
search is this?
E. By increasing footfall
A. Product and Media
B. Media and Attitude 125. Why do businesses use market re-
search?
C. Attitude and Sales
A. To identify customer needs
D. Product and Sales
B. To sell goods and services
120. When organizing information to present C. To advertise
in a business report, it is effective to:
D. none of above
A. remain objective.
B. interpret the data. 126. In which situations would a company
need to conduct marketing research? Se-
C. develop an outline. lect all that apply.
D. determine the purpose. A. to expand into a new market
121. A business owned by 2 or more people B. to determine which products to carry
who share the profits is known as..? in the future
A. Liability company C. to examine employee productivity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 445
D. to see how consumer feel about the 132. A researcher gives instructions to each in-
company terviewer to select a sample consisting of
90 people under the age of 30 and 60 peo-
PRACTICE BOOK» NOT FOR SALE
127. A system for collecting, recording, and ple over the age of 30 because that is the
analyzing information about customers, proportion of people with that characteris-
products, services, and competition. tic in the population. This is an example of
A. Market research a sample.
B. Competitive analysis A. Judgment
B. Quota
C. Qualitative research
C. Proportional stratified
D. none of above
D. Snowball
128. Holding too much stock is called
133. Discovering new information is
A. Understocking A. Consumer Research
B. Overstocking B. Primary Research
C. Raw Materials C. Secondary Research
D. Finished Goods D. Marketing Research
129. Which of the following are examples of 134. A SWOT analysis stands for what?
Field Research A. Sales, Water, Outer and Tents
A. Hall Tests B. Strengths, Weaknesses, Opportuni-
ties and Threats
B. Postal Surveys
C. Shoes, Watches, Outerwear and Ties
C. Government publications e.g. statis-
tics D. none of above
D. Telephone Interviews 135. What is a franchise?
A. When a person buys from a business
130. In a Partnership, ownership and control
of the business is shared between how B. When a person buys the rights to a
many partners? business
A. 2 to 2, 000 C. When a person owns a new business
D. When a person sues a business
B. 2 to 20
C. 2 to 200 136. A marketer is having difficulty finding
data about a competitor because the com-
D. none of above petitor’s financial records have not been
made public. Which disadvantage of sec-
131. Which of the following represents the
ondary research does this situation illus-
levels of production in an economy?
trate?
A. Traditional, domestic and export A. It can be incomplete
B. Traditional, primary and secondary B. It can be out of date
C. Domestic, import and export C. It can be costly
D. Private, public and government D. It can be time-consuming
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 446
137. The MAIN purpose of installing a sugges- 142. All of the following decisions fall within
tion box in a business place is to get work- the scope of operations management ex-
ers’ views about cept for
A. National and international issues A. financial analysis
B. Issues between workers B. design of goods and processes
C. Improvements to the work environ- C. location of facilities
mental D. managing quality
NARAYAN CHANGDER
D. Business competitors E. All of the above fall within the scope of
operations management.
138. A research exercise carried out in a labo-
ratory environment is called 143. Which is an example of quantitative
A. A focus group data?
A. What percentage of customers think
B. An experiment
Samsung make the best smart phones
C. A hall test
B. A written review of a quad-biking expe-
D. An observation test rience
C. A conversation with a customer about
139. Herbie is an Socializer when it comes to
their experience in a shop
communication style. If you are communi-
cating with Herbie, you should make sure D. The comments section of a post on so-
you: cial media
A. don’t waste time with chit chat. 144. is a method used to identify cus-
B. present facts and data. tomers with similar wants and needs.
C. avoid small talk. A. Selling
D. ask about his family. B. Planning
C. Market Segmentation
140. This type of innovation occurs when a
business either creates or improves a prod- D. Sales pitch
uct. 145. What information can businesses find out
A. Process Innovation from market research? Select all that ap-
ply
B. Position Innovation
A. Market size and trends
C. Product Innovation
B. Identify customer preferences
D. Paradigm Innovation
C. Information about different market
141. Secondary research is cost-effective for segments
marketers because the data D. Information about their competitors
A. already exist
146. Which of the following are acceptable
B. are cheap to purchase forms of savings for individuals?
C. are specific A. Insurance Companies
D. are incomplete B. Commercial Banks
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 447
C. Sou Sou 152. The Factors of Production are
D. All of the above A. Capital
PRACTICE BOOK» NOT FOR SALE
B. Entrepreneur
147. Which two of the following are examples
of stakeholders for a sole trader? C. Enterprise
A. Shareholders D. Labour
B. Government E. Land
C. Humanitarian aid 153. Which is a formatting characteristic of a
D. Pressure groups full-block business letter?
E. Parents A. double-spacing within the paragraph
B. no paragraph indents
148. Government reports would be which kind
of market research? C. indented first paragraph
A. Field Research D. using a right justification for all para-
graphs
B. Quantitative Research
C. Desk Research 154. A clothing store asks their customers to
fill out a short survey after their purchase.
D. Target research What type of research is this?
149. Research that is conducted without hav- A. Sales research
ing a specific decision in mind is called B. Attitude research
A. performance monitoring research C. Comparison shopping
B. applied business research D. Trade publication
C. basic business research
155. What is trade credit
D. evaluation research
A. A short term source of finance from a
150. In addition to its fixed premises, a de- supplier for stock.
signer clothes shop has launched a website B. A long term source of finance from a
in an attempt to: supplier for stock
A. Increase costs C. A short term source of finance from a
B. Decrease costs bank for stock
D. A long term source of finance from a
C. Increase sales
bank for stock
D. Decrease sales
156. Which of these are ways to collect pri-
151. Lead time is: mary data? Check all that apply.
A. Time taken to make a product A. Census information
B. Time taken to sell a product B. Government publications
C. Time taken to deliver a product C. Surveys
D. none of above D. Interviews
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 448
157. Which advertising tool the business use, C. just-in-time inventory methods
when they advertise position within the D. statistical quality control
business:
E. all of the above
A. radio
B. newspaper 162. If you advertised your intended new busi-
ness on different social media platforms
C. notice board
and asked a large number of people to in-
D. billboard vest money into the business, you would
NARAYAN CHANGDER
be looking for which source of capital?
158. The problem statement section of the pro-
posal A. A group loan
A. states the management problems B. Business angel financing
B. states the background of the problem C. Crowdfunding
C. explains the problem’s consequences D. Crowdfunding
D. all the above.
163. Which functional area is responsible for
159. What are the drawbacks of segmenta- health and safety in the workplace?
tion? A. Finance
A. Can be costly targeting different cus- B. Human Resources
tomers with different products/services
C. Marketing
B. Focusing on a small group can mean
you miss other opportunities D. Operations
C. You can split up the market to much 164. Which of the following questions would
and cause a rift best be answered by the purchasing func-
D. Makes your branding less effective tion?
E. Some segments are harder to segment A. How can we inform customers of avail-
than other segments able merchandise?
B. How can we protect merchandise from
160. What is the name given to the share of
pilferage?
profits paid by a franchisee to a franchisor
each year? C. How much merchandise should we
A. Loyalties buy?
B. Patent D. How will merchandise be shipped to
us?
C. Royalties
D. Taxation 165. The major weakness of mail survey is
A. the impersonality of communication.
161. Walter Shewhart is listed among the im-
portant people of operations management B. the inability to direct your message to
because of his contributions to a specific person.
A. assembly line production C. the strong risk of non-response.
B. measuring the productivity in the ser- D. the inability to secure confidential in-
vice sector formation.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 449
166. Which of the following would not be car- 171. Which 3 factors to consider when pricing
ried out by the Operations function of a a product to attract and retain customers?
business? -3 answers to select
PRACTICE BOOK» NOT FOR SALE
A. Ensuring compliance with employment A. Income levels of target customers
legislation B. Price of competitor products
B. Quality control C. Layout of the store
C. Production planning D. Cost of product
D. Logistics
172. An economics system where producers
167. Which one of the following is a risk as- and consumers are the main decision mak-
sociated with starting up a new business ers is called a
enterprise A. traditional economy
A. Business success B. planned economy
B. Independence C. free market economy
C. Profit D. mixed economy
D. Business failure
173. It is easier for employees to develop pos-
168. Which functional area is responsible for itive customer/client relations if employ-
monitoring cash flow? ees understand that each customer is:
A. Banking A. a possible problem.
B. Finance B. a unique individual.
C. Human Resources C. in a hurry.
D. Operations D. like most others.
169. The function of marketing that is con- 174. Globalalisation means
cerned with collecting data to help make A. national interaction between all types
business decisions is of business
A. Financing B. refers to the integration and intercon-
B. Pricing nection of businesses all over the world
C. Marketing research C. refers to the worldwide movement to-
D. Promotion ward cultural interconnection
D. is a result of massively increased Eu-
170. Every research report should include ropean trade and cultural exchange.
a statement on the study’s limitations.
Where, in the report, is the most appro- 175. The production process commences refers
priate place to locate this? to:
A. Synopsis A. Output
B. Introduction B. Input
C. Methodology C. Process
D. Appendix D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 450
176. How do you calculate revenue? 182. Which of the following is an example of
A. quantity x sales price quantitative data:
B. quantity x variable cost A. “The customer smiled when she heard
C. quantity + sales price the name of the new product.”
D. quantity x fixed cost B. “Many local residents enjoy playing
sports at the community center.”
177. Who would deal with-recruitment and se-
lection of employees-training and develop- C. “The salespeople think that customers
NARAYAN CHANGDER
ment of employees-performance manager want more payment options.”
of employees
D. “Sales of this particular model have
A. Human Resources fallen 13% in the last year.”
B. Marketing
C. Operations 183. This type of marketing research is used
to determine if or how effective the media
D. Finance efforts are for a company, brand, or prod-
178. Which of the following is not a source of uct.
finance A. Market
A. Hire purchase
B. Product
B. Loan from friends and family
C. Advertising/Media
C. Bank loan
D. None of the above D. Attitude/Opinion
179. Identify an internal stakeholder. 184. Seeks open-ended responses. Answers
A. Customer questions about “why” and “how”
B. Banks and lenders A. Qualitative Research
C. Supplier
B. Quantitative Research
D. Employee
C. Survey
180. Identify an internal factor of an organisa-
tion. D. Questionnaire
A. Political
185. Which of the following best describes the
B. Environmental term, obsolete? When consumers:
C. Technology
A. Demand more of a particular product
D. Competition or service
181. The following are all instruments of pay- B. Can no longer afford to buy a particu-
ment EXCEPT a lar product or service
A. debit card C. Want, and can afford, to buy more
B. debit note products and services
C. money order D. No longer want to buy a product or ser-
D. money transfer vice
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 451
186. Qualitative research answer questions 191. The main goal of causal research is:
that begin with A. To directly seek the solution to a par-
PRACTICE BOOK» NOT FOR SALE
A. how much or how many ticular, pragmatic problem
B. when or where B. To identify cause-and-effect relation-
C. why or who ships between variables.
D. how or why C. To clarify the nature of problems
D. To provide a conclusive statement
187. What does break even point show?
about the characteristics of a particular
A. where a business is neither making a population or phenomenon.
profit or loss
B. how many items to make 192. How do you calculate total variable
costs?
C. how much profit they’re making
A. quantity x variable cost per unit
D. where a business has more fixed costs
than variable B. quantity x fixed costs
C. sales price x variable cost per unit
188. One element of a SMART financial goal is
missing the in the example below. Which D. fixed costs x variable cost per unit
one is it? “I will save $150 each month
193. Which of the following describes margin
to go on a vacation in one year.”
of safety?
A. Measurable
A. e difference between actual and break
B. Specific even levels of output
C. Time Bound B. Where total revenue and total costs
D. Attainable are equal
189. A mortgage is a source of finance needed C. The number of sales required to break
if the firm is buying even
A. equipment D. Profit made above the break even level
of output
B. premises
C. shares 194. This company provides high quality mar-
ket research to business for a fee
D. stock
A. Mintol
190. Which of these is not a possible reason
B. Mintel
for carrying out market research?
C. Minetol
A. To work out a possible price for a prod-
uct D. Mitel
B. To find out about meeting consumer 195. Which is correct regarding aims and ob-
needs jectives
C. To find out what the Government will A. SMART
do with interest rates next year
B. SHORT
D. To find out how similar prod-
ucts/services from other companies are C. SMASH
selling D. SECURE
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 452
196. An operations manager is not likely to be B. Intermediate
involved in C. Unrealistic
A. the design of goods and services to D. Long-term
satisfy customers’ wants and needs
B. the quality of goods and services to 201. A sole trader decides to advertise their
satisfy customers’ wants and needs business using social mediaName one key
feature of advertising using social media
C. the identification of customers’ wants is that:
NARAYAN CHANGDER
and needs
A. It will only be seen by people aged un-
D. work scheduling to meet the due dates der 25
promised to customers
B. It is time-consuming to change details
E. maintenance schedules
on existing advertising
197. Reliability is one of the criteria of a good C. It is low cost to keep details up-to-date
research. Reliability involves:
D. It can only target people in the local
A. Whether a technique when repeated area
to the same object gives the same an-
swers every time. 202. Joe’s supervisor at work asked him to
write a report comparing what their com-
B. The method to ensure a hundred per-
pany is spending on electricity this year to
cent accuracy.
what it has spent each of the previous four
C. Identify the absolute precision. years. Which of the following would be
D. Identify that the measure gives what it the BEST source for Joe to research?
is supposed to measure. A. His company’s records
198. Which of the following is an example of B. Wikipedia
secondary data: C. The Environment Protection Agency’s
A. The information on a sales invoice website
B. The results of a focus group D. weather.com
C. The outcome of an experiment 203. Which of the following are ways of meet-
D. The answers to a survey ing customer needs?
A. Lower Prices
199. Pick the risks for an entrepreneur
B. Greater Choice
A. lack of job security
C. More Convenience
B. business failure
C. profit D. Finding a gap in the market
D. financial loss E. Reducing Quality
200. Mark and Susan, a recently married cou- 204. Which of the following is a feature of
ple with full-time jobs, set a goal of flow production?
putting $200 in savings every month to A. Products are produced continually on
make a down payment on a home in five a production line
years. What type of goal have they set? B. Products are one-off meeting cus-
A. Short-term tomer needs exactly
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 453
C. Products are made in small identical 210. Give an influence of an employee.
groups
A. They can shop elsewhere
PRACTICE BOOK» NOT FOR SALE
D. Cost of producing one unit is high
B. They want job satisfaction and good
205. Which are examples of primary re-
working conditions
search?
A. Focus Groups C. They can take industrial action e.g.
B. Internet Websites strike
C. Experiments D. They can provide a poor service to the
D. Surveys customer
E. Local Newspapers
211. Which of the following is an example of
206. Which of the following are reasons to a primary data source:
carry out market research?
A. Identify a gap in the market A. inventory reports
B. Understand customers opinions of B. survey
products
C. Add value C. sales reports
D. Reduce variable costs D. expense reports
E. Improve interest rates
212. The particular market segment at which
207. Traditionally those engaging this re-
a business aims its products is known as
search spend years in the place of study,
the:
also known as the “field.” Which research
design is this statement related to? A. Target Market
A. Experimental
B. Unique Selling Point
B. Case study
C. Ethnography C. Main Market
D. none of above D. Market Leader
208. Which of the following is not an advan-
tage of buying a franchise? 213. Which one of the following is a definition
A. Make more profit of the break-even level of output?
B. Access to a successful business idea A. The level of output where total fixed
C. Lower costs costs equal total revenue
D. Have total control of a business B. The level of output where total fixed
209. Primary research collects data for costs equal total variable costs
A. marketers across the industry to use C. The level of output where total rev-
B. understanding economic cycles enue equals total variable costs
C. the research project at hand D. The level of output where revenue
D. informational purposes only equals total costs
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 454
214. Pete’s teacher has assigned him to write A. primary research
a report on the life of Donald Trump based B. product research
solely on primary sources. Which of the
following would be the BEST source for C. secondary research
Pete to research? D. survey research
A. Wikipedia
219. Businesses that have unlimited liability
B. Donald Trump’s autobiography are
NARAYAN CHANGDER
C. An article in Fortune magazine A. incorporated
D. A blog he found about Donald Trump B. unincorporated
running for President
C. Limited companies
215. Which of these is an example of qualita- D. Franchises
tive market research
A. Government statistics 220. All of the following should be considered
when creating a questionnaire to collect
B. Questionnaire data EXCEPT:
C. Focus group A. making sure the language is appropri-
D. Trade reports ate
216. Which of the following are methods of re- B. making sure that the questions are
ducing risk? clear and understandable
A. Carrying out detailed market research C. the researcher’s opinion should be ev-
ident/obvious in the questions
B. Produce a business plan
D. making sure that the questions explore
C. Raise sufficient start-up finance your research objective
D. Use a bank overdraft
221. Which of the following would not be a
E. Rely on instinct useful tip for designing a questionnaire?
217. The five elements in the management pro- A. Avoid loaded questions
cess are
B. Avoid double-barrelled questions
A. plan, direct, update, lead, and super-
C. Be as general as possible
vise
D. Sensitive questions should be asked at
B. accounting/finance, marketing, opera-
the end.
tions, and management
C. organize, plan, control, staff, and man- 222. Kelly is conducting a research study fo-
age cused on teen females. Teen females
would be considered the of her re-
D. plan, organize, staff, lead, and control
search study.
E. plan, lead, organize, manage, and con-
A. population
trol
B. sample
218. Information already collected for another
purpose that can be used to solve the cur- C. consumer
rent problem D. customer
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 455
223. Internal secondary data may come from 228. Marketing budget is a financial plan for
all of the following EXCEPT: the marketing of a or product for
a specific time period.
PRACTICE BOOK» NOT FOR SALE
A. Inventory reports
B. quarterly sales reports A. product, range
C. new customer surveys B. product, package
D. customer data C. plan, range
D. business, range
224. Which of the following could help a busi-
ness survive in a competitive market? 229. Name 2 Fixed cost examples
A. Lowering its prices A. Stock
B. Changing suppliers regularly B. Salaries
C. Giving customers special offers C. Raw material
D. Hiring more staff D. Rent
E. Improving efficiency 230. Which one of the following steps in the
research process is true to be most critical
225. The purpose of literature review is to
for setting the direction of all phases of
A. provide the background and critical ba- the research project?
sis for our research study.
A. Data collection and analysis
B. provide conclusion for our research
B. Report writing
findings.
C. Determining information types and
C. criticize the author’s credential.
sources
D. emulate the research methodology
D. Defining the problem
used.
231. What type of data is numerical?
226. Select correct responses. Sources of Fi-
nance? Where can Sally ask for a large A. Quantitative
amount of money? B. Qualitative
A. Friends and family C. Primary
B. Loan D. Secondary
C. Crowd funding
232. Which of the following resources is cor-
D. business angels rectly matched with the country in which
it can be found?
227. Eli Whitney, in the , provided the foun-
dations for in operations management. A. Asphalt-Barbados
A. 1920s; statistical sampling B. Gypsum-Jamaica
B. United Kingdom; mass production C. Silica sand-Suriname
C. U.S. Army; logistics D. Manganese-Trinidad
D. nineteenth century; interchangeable 233. What is one limitation to calculating
parts break even?
E. none of the above A. helps projected sales
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 456
B. based on estimates 239. Budgeting, paying the bills, and collection
C. based on multiple products of funds are activities associated with the
D. considers stock wastage A. management function
B. control function
234. Marketers often conduct primary re-
C. finance/accounting function
search when secondary research
D. production/operations function
A. isn’t complete enough
E. staffing function
NARAYAN CHANGDER
B. is too costly
C. is too time-consuming 240. Which of the following is a guideline for
writing a job application letter?
D. isn’t broad enough
A. Provide as much information as possi-
235. The finished product is ready for con- ble
sumers to purchase refers to: B. Mention your other prospects
A. Output C. Include a list of references in the let-
B. Input ter
C. Process D. Be brief and to the point
D. none of above 241. Which of the following is an advantage
of primary research:
236. How many market segmentations are
there? A. It never “expires.”
A. 4 B. It is specific.
B. 8 C. It is inexpensive
D. It is easy to conduct.
C. 2
D. 10 242. Amber’s academic adviser has asked her
to set 3 academic goals for this semester.
237. Which are examples of secondary re- These goals are MOST LIKELY to be accom-
search? plished if:
A. Market Reports A. Amber lets her friends set her goals.
B. Observations B. Amber writes her goals down.
C. Government Reports/Statistics C. Amber thinks about her goals weekly.
D. Sales Data D. Amber discusses her goals with her
E. Social Media parents.
243. Specifying means to translate the
238. Which two of the following are aspects
problem definition into a precise statement
of SWOT analysis?
of who should or should not be included in
A. Strengths the sample.
B. Wants A. the sampling frames
C. Targets B. the sampling element
D. Opportunities C. the target population
E. Openings D. the sampling unit
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 457
244. What is the main disadvantage of con- B. Primary and Tertiary
ducting primary research? C. Private and Public
PRACTICE BOOK» NOT FOR SALE
A. It is not customized to the research D. Private and Third
needs
B. It takes control away from the mar- 249. Chick-fil-a has to analyze costs to deter-
keters mine how much to price their new salad.
Which function of marketing is this?
C. It is costly to carry out
A. Pricing
D. It can be difficult to find respondents
B. Promotion
245. What is the term for using mobile phones C. Financing
to sell products/services
D. Selling
A. E commerce
B. Apps 250. Which of the following is NOT a skill that
a business would look for when recruit-
C. M Commerce ing?
D. Payment platform A. Teamwork
246. Which of following are the characteristics B. Leadership
of an entrepreneur (as stated by the exam C. Plagiarism
board)
D. Qualifications
A. Determination, Academic, Literate,
Management 251. Which two of the following statements
B. Hard working, Adaptable, Resilient, are disadvantages of primary research?
Creativity A. Many people don’t like completing sur-
C. Accounting, Management, Sales tech- veys
nique, Determination B. You can find specific information
D. Self belief, Motivation, Confidence, C. Some people just say what they want
Leadershio you to hear
E. Creativity, Risk taking, Determination, D. The business has control over the re-
Confidence search and results
247. Which of the following products is likely 252. An example of an unethical business ac-
to be made using job production? tivity is:
A. Heinz baked beans A. Payment of just wages to workers
B. Cadburys Dairy Milk B. Abstaining from misleading advertis-
C. Land Rover car ing
D. Made to measure wedding dress C. Presenting false sales
D. Not accepting bribes
248. Oxfam is a charity that operates in the
Third Sector. Identify 2 other Sectors of 253. Which of the following represents non-
Economy. probability sampling?
A. Primary and Secondary A. Stratified random sampling
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 458
B. Cluster sampling C. Social media
C. Quota sampling D. Newspapers
D. Systematic sampling 259. Market research is the process of gather-
ing, analyzing and interpreting about
254. The primary reason the business benefits
a
when salespersons practice good customer
relations is that it: A. results, business
A. develops repeat customers. B. information, market
NARAYAN CHANGDER
B. prevents customer objections. C. surveys, product
C. promotes quality service. D. price, product
D. segments the business’s market. 260. A directed finding of published works
which includes books and periodicals and
255. What source of finance is for short term it discusses theory and presents empirical
emergencies results relevant to topic at hand is known
A. Overdraft as
B. Bank Loan A. pilot study
C. Venture Capital B. literature review
D. Crowdfunding C. pretest
D. experiment
256. A market situation where shares are
brought and sold is commonly referred to 261. What are the 4 p’s of marketing?
as A. price, product, promotion, place
A. Stock Market B. price, person, promotion, place
B. Share market C. place, perspective, promotion, place
C. Share Exchange D. none of above
D. Investment Banks
262. Which of the following is a legal external
257. Select correct responses. Sources of Fi- factor which could affect product develop-
nance? Laura wants to set up her own ment?
business. Name 2 sources of finance she A. Copyright Challenge
could consider which don’t incur (add) a in- B. Economic Recession
terest amount added onto
C. Interest rate rise
A. Own savings
D. Launch of a new mobile operating sys-
B. Friends and Family tem.
C. Bank Loan
263. Which one of the following is not associ-
D. Small business grants ated with being an entrepreneur?
258. A business uses online methods to spread A. Organising resources
a message. This is known as.. B. Making business decisions
A. Viral Marketing C. Taking risks
B. Data collection D. Working for other people
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 459
264. Total cost is worked out using which for- 269. This type of innovation involves a signif-
mula? icant change in thinking.
PRACTICE BOOK» NOT FOR SALE
A. Fixed costs + variable costs A. Product Innovation
B. Fixed costs / variable costs B. Process Innovation
C. Fixed costs x variable costs C. Paradigm Innovation
D. Fixed costs / variable costs D. Position Innovation
265. What is a example of validity?
270. Levels of measurement can be classified
A. A set of questions fully answering as:
what the business wants to know about a
A. Nominal, ordinal, interval, ratio
target market
B. Binomial, multinominal, normal
B. A set of questions that are poorly writ-
ten C. T-test, z-test, chi-squares, f-test
C. A set of questions that vaguely answer D. None of the above
the companies question
271. A focus group is an example of
D. A long survey asking the consumer ran-
dom questions A. Quantitative research
266. The Scott Company decided to sell stock B. Qualitative research
to raise capital. Under what form of busi- C. Secondary research
ness organization does the company oper- D. No research
ate?
A. Corporation 272. Mr. Jones has several bills of fixed
amounts to pay each month. His bank
B. Cooperative
agreed to pay them monthly from Mr.
C. Partnership Jones’ account. This service, provided by
D. Proprietorship the bank, is referred to as
267. Andy is collecting data by sending a sur- A. an overdraft
vey to his classmates about their opinion B. a fixed deposit
on new school policies. What type of re-
C. a standing order
search is this?
D. a letter of credit
A. product
B. sales 273. An exit strategy as part of a business
C. attitude plan is put in place to
D. media A. allow venture capitalists to get out
their money
268. What is the first step in the marketing
B. allow the firm to quickly change its in-
research process?
vestment decisions
A. Analyze results
C. allow the firm to close down with all
B. Defining the problem investors getting back their money
C. Experiment D. allow the firm to leave an industry
D. Conduct a survey safely
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 460
274. How can a business reduce the risk of fail- 279. Ordinal measurement has which of the
ure? following uses?
A. By selling less products A. Ranking items, rating characteristic,
B. By keeping the cost of their products complex scales and other indices.
low B. Creating of complex scales and indices
C. By carrying out market research and the ranking items.
D. By staying open late. C. Ranking of characteristic and ranking
NARAYAN CHANGDER
275. Job analysis is conducted when: the items.
A. A vacant position first becomes avail- D. None of the above.
able
280. A is especially important when the
B. Applicants have sent in their CVs for
research is large and complex or when an
review
outside firm carries it out.
C. References have been received by the
organisation A. detailed web page
D. The applicant has accepted the post B. written research proposal
276. What are the benefits of primary re- C. detailed organization chart
search? D. PERT diagram
A. More Accurate
B. Up to date 281. What is reliability?
C. Specific to the businesses needs A. A set of questions fully answering
what the business wants to know about a
D. People can’t lie
target market
E. Less time-consuming
B. When a research technique produces
277. Which of the following documents is sent results that are not correlated
by the creditor to the debtor to indicate
the total extent of indebtedness? C. When you can count on a company to
perform well in the upcoming year
A. Debit note
D. When a research technique produces
B. Credit note
nearly identical results in repeated trials
C. Statement
D. Receipt 282. A sole trader business has unlimited lia-
bility. One key feature of unlimited liabil-
278. Who would deal with-research ity is that:
of market-finding out customers
requirement-dealing with Product, price, A. they are responsible for all of their
place and promotion debts
A. Human Resources B. they are working with a number of
B. Market Research other people
C. Operations C. they cannot get finance from a bank
D. Finance D. they work on their own
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 461
283. Outline ways a business can measure cus- 288. The operations department is responsible
tomer satisfaction. for:
PRACTICE BOOK» NOT FOR SALE
A. Customer surveys A. Selling of products
B. Provide high quality products B. Manufacturing of products
C. Train staff well C. Aftersales of products
D. Returning products
D. Online reviews
289. What is qualitative data?
284. How does differentiating a product help
a business? A. Data involving numbers
A. Targets different market segments B. Data involving information with no
numbers
B. Adds value
C. Data with information that involves
C. Fills a gap in the market business’ marketing strategies
D. Helps you gain an advantage over ri- D. data involving colors
vals when facing competition
290. Stock that is currently being made is
E. Reduces inflation called
285. Comparing the prices offered by different A. Raw materials
vendors for the same goods and services B. Work in Progress
is what part of the purchasing process? C. Finished Goods
A. bid analysis D. none of above
B. invoice payment
291. A business whose main focus is on the
C. price fixing product rather than customer wants.
D. receipt of goods A. Market Oriented
B. Product Oriented
286. Understocking causes problems such as:
C. Business Oriented
A. Shortage of materials and a bad repu-
tation D. Price Oriented
B. Higher admin costs and more profit 292. How do new business ideas come about
C. Late delivery of materials and in- A. Changes in technology
creased sales B. Adapting an exiting idea
D. none of above C. Products being obsolete
D. Changes in consumer wants
287. Which of the following is an indirect com-
petitor of Pizza Hut? 293. In the market for shares, a stag is defined
A. Pizza Express as:
A. a person who buys shares on the stock
B. Dominos
market in anticipation of a rise in prices
C. Papa Johns
B. a person who sells shares on the stock
D. Subway exchange in anticipation of a price fall
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 462
C. an investor who issues a stop order to 298. What could cause data to be unreliable?
his broker A. Only asking a small sample
D. an investor who buys shares of new B. Poorly worded questions
companies in anticipation of a price in-
C. Asking coffee drinkers about their
crease
opinion of coffee
294. The marketing function’s main concern is D. Asking a variety of age groups
with
299. Information collected for the very first
NARAYAN CHANGDER
A. producing goods or providing services time to fit a specific purpose.
B. procuring materials, supplies, and A. Primary data
equipment
B. Secondary data
C. building and maintaining a positive im-
C. Quantitative data
age
D. none of above
D. generating the demand for the organi-
zation’s products or services 300. People that complete the survey are
called
E. securing monetary resources
A. Sample
295. All of the following are common survey B. Customers
methods EXCEPT
C. Respondents
A. Mail
D. Survey-senders
B. Telephone
301. Which of the following is not a reason
C. Lie-detector tests
businesses use marketing research?
D. Online A. identifying market oportunities
296. Apple does research to determine the B. solving marketing problems
best packaging for protecting the new C. monitoring market performance
IPhone. What type of research is this?
D. deciding when staff should have team
A. Product meetings
B. Attitude 302. Research designs may be categorized
C. Sales according to their fundamental objective.
Which of the following are research design
D. Media
categories?
297. What is the meaning of human re- A. Scientific, exploratory, descriptive
sources? B. Descriptive, research, experimental
A. The people who represents a business C. Descriptive, causal, exploratory
B. The best person to do the job D. Causal, experimental, scientific
C. The people employed to do work in a 303. Macys.com has customers complete a sur-
business vey to get their opinions about their on-
D. Supervises employees and sets tasks line experience. What type of research is
to be done this?
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 463
A. Attitude B. Field Research
B. Advertising C. Independent Research
PRACTICE BOOK» NOT FOR SALE
C. Product D. Group Research
D. Sales 309. Which of the following are risks for a
business?
304. Which of the following statements are
true? A. Business Failure
B. Financial Loss
A. It is okay to plagiarize if you don’t get
caught. C. Unreliable Market Research
B. It is okay to plagiarize if you are writ- D. Lack of Security
ing something for work instead of school. E. Government Taxation
C. It is okay to plagiarize if the original 310. Which two of the following are examples
writer is dead. of fixed costs?
D. It is never okay to plagiarize. A. Rent
305. What does product research help with? B. Salaries
A. helps by identifying key issues and C. Commission
avoiding costly mistakes with a product D. Bonuses
B. to analyze past sales data E. Raw materials
C. to determine the impact an advertise- 311. If three employees each work 35 hours
ment has a week and produce a total of 9, 764
D. to get consumer opinion about your items, what is their total hourly produc-
brand tivity level?
A. 105
306. This type of innovation occurs when a
business changes how something is done. B. 93
C. 31
A. Process Innovation
D. 67
B. Paradigm Innovation
C. Product Innovation 312. Why is it often important to take notes
during meetings or presentations?
D. Position Innovation
A. The audience needs something to do.
307. Which of the following are disadvantages B. The speaker is difficult to understand.
of Desk Research?
C. This information will be needed later.
A. May be out of date
D. Writing keeps the mind focused.
B. Expensive to collect
313. One reason that marketers conduct sec-
C. Time Consuming ondary research is to
D. none of above A. clarify research questions
308. What is primary research also known B. create hypotheses
as? C. make accurate predictions
A. Desk Research D. learn more about a specific industry
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 464
314. Who roles is it toorganise the process C. 10%
that turns inputs into outputs/finished
D. 20%
goods that can be sold to customers
E. 50%
A. Human Resources
B. Marketing 319. Good leadership can be characterised by
C. Operations which of the following activities? I. Hon-
esty and integrityII. Doing many different
D. Finance things simultaneouslyIII. Being inflexible
NARAYAN CHANGDER
on what need to be doneIV. Making good
315. Why do businesses perform market re-
decisions
search? Select all that you think apply
A. To see what their competitors are do- A. I and II
ing B. II and III
B. Identify wants and needs of customers C. III and IV
C. To respond to changing consumer D. I and IV
needs
D. To increase risk when launching new 320. In order to be successful a business needs
products to?
A. Identify its customers needs and
316. This is a small number of people who are
wants
brought together to discuss elements of a
specific issue or problem. B. Have a big shop
A. Focus Group C. Sell products really cheap
B. Observation D. Have lots of sales
C. Survey
321. Which are the correct 6 market segments
D. Test Market
A. Location, demographics, religion,
317. Which of these is an example of a pre- lifestyle, income, age
cisely defined issue (problem)? B. Gender, demographics, behaviour,
A. Why are current sales so poor? lifestyle, income, age
B. Will additional advertising have a posi- C. Location, demographics, behaviour,
tive impact on sales? lifestyle, income, age
C. Are we in compliance with current lo- D. Location, demographics, gender, reli-
cal pricing legislation? gion, income, age
D. What percentage of adults recall an ad-
vertisement two days after it appeared? 322. Which of the following is an advantage
of secondary research:
318. Illiteracy and poor diets have been A. It is up to date.
known to cost countries up to what per-
cent of their productivity? B. It gives marketers control of the study.
A. 2% C. It is quick.
B. 5% D. It is specific to the research needs.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 465
323. How can marketing research help a com- 328. A vendor is extending credit to the Jones
pany? Company in return for the Jones Com-
pany’s agreement to use the vendor as the
PRACTICE BOOK» NOT FOR SALE
A. help them organize their taxes
sole source of its supplies. What federal
B. helps them recruit interns act is the vendor and the Jones Company
C. helps identify bad customers violating?
D. helps increase sales and profits A. Clayton Act
B. Robinson-Patman Act
324. An independent variable is:
C. Celler-Kefauver Act
A. A theoretical concept.
D. Sherman Act
B. A variable, which influences other vari-
ables. 329. In order to be understood on the tele-
C. A variable, which is influenced by other phone, a business’s employees should al-
variables. ways:
D. A set of attributes/properties. A. speak from notes.
325. New York Fashions Clothing Company B. use technical terminology.
surveys customers to find out which zip C. enunciate clearly.
codes most of their customers reside. The D. speak rapidly.
results will help with the company’s relo-
cation plans. This is an example of which 330. Desk Research is also known as
marketing function?
A. Primary Research
A. Distribution
B. Secondary Research
B. Financing
C. Third Research
C. Marketing-information management
D. Fourth Research
D. Selling
331. Which of these is NOT a source of sec-
326. Which two of the following are examples ondary data?
of primary market research?
A. Census information
A. Internet research
B. Government publications
B. Market reports
C. Previous studies done
C. Customer surveys
D. Focus groups
D. Government statistics
E. Focus group 332. Tyler walks into a Starbucks, and keeps
track of how many caramel cinnamon lat-
327. Which one of the following is an example tes are being sold to gather data. What
of primary market research? method is he using?
A. Government Statistics A. Survey
B. Internet B. Observation
C. Market Report C. Product Mix
D. Observation D. Product line
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 466
333. Which of these is most likely to be an ob- A. media research
jective of a new business?
B. quantitative research
A. Profit maximisation
C. qualitative research
B. Survival
D. product placing
C. Paying dividends to owners
D. Re-branding 338. Individuals are companies that marketing
efforts are aimed at.
NARAYAN CHANGDER
334. Which of the following best describes the
A. Target market
term off the job training? Training that
takes place: B. Customer profile
A. Whilst completing a task under the di- C. Demographics
rect supervision of a work colleague
D. none of above
B. Away from the place where the job role
is usually performed 339. Which of the following are features found
C. On the first day of a new job in cottage industries?
D. Whilst shadowing another member of A. Small investment, family help, long
staff at work hours of work, lack of continuity
B. Family help, operated from home, pro-
335. Cross sectional research designs will:
duce for export, mechanised
A. Measure multiple variables at one
C. Produce for export, skilled labour, lo-
point in time.
cal resources, large-scale production
B. Measure the same population repeat-
edly throughout time. D. Small investment, family help, produce
for export, operated out of home
C. Undertake an analysis of sections, and
then piece together to form a whole . 340. Which of the following is an example of
D. Measure a single variable across mul- internal data:
tiple groups. A. A field test
336. The service industry makes up approxi- B. A cash register receipt
mately what percentage of all jobs in the C. A competitor’s website
United States?
D. A media report
A. 12%
B. 40% 341. All calls coming into a business should end
C. 66% as pleasantly as possible in order to:
D. 79% A. provide callers with accurate informa-
tion.
E. 90%
B. make the best use of an employee’s
337. Carolyn is planning on releasing a new time.
product in her candy business and makes
C. help an employee get a good review.
a survey to collect data.She asks “how of-
ten do you eat chocolate bars? ”What ex- D. leave a good last impression with
ample of marketing research is this? callers.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 467
342. What is the break even formula? usually need to have which type of effec-
A. Fixed costs Break Even = (Selling tive skills?
PRACTICE BOOK» NOT FOR SALE
Price * Variable Cost per unit) A. computer
B. Selling PriceBreak Even = ( Variable B. technical
Cost per unit-Fixed costs)
C. verbal
C. Selling Price Break Even = ( Fixed
costs + Variable Cost per unit) D. reading
D. Fixed costs Break Even = (Selling 347. Statistics for Media Research including all
Price-Variable Cost per unit) of the following EXCEPT
343. A type of business ownership in which A. audience
one or more of the owners does not have B. frequency
full liability is called a
C. ratings
A. general partnership.
D. broadcast
B. limited partnership.
C. service organization. 348. Cadbury chocolate has alot of competi-
tors in its market. They have a lot of re-
D. sole proprietorship. turning customer.. This is known as
344. Which of these methods is an example of A. Customers
primary market research?
B. Customer Loyalty
A. Focus group talking about the product
C. Negative comments
concept
B. A google search for relevant newspa- D. Returning employees
per artlicle
349. Which of the following is a true state-
C. A government report on the target ment about external data:
market
A. They come from original research
D. Mintel report on the target market
B. They are represented numerically
345. Which of the following represents the C. They are the easiest data to access
sequence of documents needed before a
company can commence business? I. Cer- D. They can cost money to obtain
tificate of IncorporationII. Certificate of
tradingIII. Memorandum and Articles of 350. Give a description of the Private Sector.
AssociationIV. Prospectus A. Owned by the government on behalf of
A. IV, I, II, III the taxpayer.
B. II, I, IV, III B. Owned by private individuals who aim
to make a profit.
C. III, IV, II, I
C. Owned and regulated by the govern-
D. IV, III, I, II ment and aim to raise funds and aware-
ness
346. To be able to explain and defend their
ideas objectively to others, individuals D. Owned by a sole trader
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 468
351. Which of these is not a reason for start- B. 7
ing a business? C. 4
A. To have more time to yourself D. 5
B. To make a living from something you
are interested in doing 357. The first step in selecting a sample is to:
C. To make money A. Determine the sample size
D. To be in control of your own future B. Select probability sample method
NARAYAN CHANGDER
C. Define the sampling frame
352. Which of the following would be included
in a business plan for a start-up business? D. Define the target population
A. A review of the business objectives set 358. Does a gap in the market always meet
last year customer needs?
B. Sales during the last 12 months A. Yes
C. Profits during the last 12 months B. No
D. Profit forecasts for the next 12 months C. Yes, if they are an experienced en-
353. Which is a typical type of survey? trepreneur
A. Face to face D. none of above
B. All of them 359. Stakeholder conflict
C. Postal A. Is when a business disagrees with its
D. Telephone or email stakeholders
B. Is a punch-up at a BBQ
354. Which of the following is an outside
factor that affects the business environ- C. Is when different stakeholder groups
ment? have competing objectives
A. Staff organization D. Is when a stakeholder decides not to
support the business any more
B. Industry competition
C. Conflict negotiation 360. a business plan
D. Information management A. is useful once your business is opera-
tional but not much help during the startup
355. Which of the following tasks would be phase
carried out by the Marketing function of a
B. is not usually needed to secure financ-
business?
ing in your business
A. Allocating financial resources
C. can serve as a tool for managing your
B. Finding out customer opinions business once it is up and running
C. Planning Production D. All of the above
D. Selecting new employees
361. Which type of interview technique of-
356. How many Sectors of Industry are fers the advantages of cost, quality and
there? speed?
A. 3 A. In-office interview
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 469
B. Telephone interview D. Available in usable form that meets a
C. Mall-intercept interview manager’s specific needs.
PRACTICE BOOK» NOT FOR SALE
D. In-home interview 367. Which one of the following is an example
of a non-financial aim for a new start-up
362. The main aim of a feasibility study is to business?
determine which
A. Increase market share
A. Business venture will be profitable
B. Survival
B. Business will accept bribes
C. Financial security
C. Business will be ethical
D. Independence
D. All of the above
363. Number of workers Total output per 368. Select 2 ways to carry out Primary mar-
day1 202 353 454 50Using the table ket research
above, what is the contribution of the third A. Books
worker to total production?
B. Surveys
A. 45 units
C. Purchased research
B. 100 units
D. Questionnaires
C. 10 units
D. 15 units 369. What is a better definition of desk re-
search?
364. Which of the following is a way that busi- A. Stealing someone elses information
nesses often use database software pro-
grams? B. Collecting new information
A. To calculate weekly payroll. C. Using information that already exists
B. To prepare promotional material. D. Finding old research
C. To organize vendor information. 370. Which is the odd one out?
D. To diagram work schedules. A. Newspaper
365. The fee charged by the insurance firms for B. Magazines
services provided to an account is called C. Books
A. assured
D. Questionnaires
B. insurance
371. Select correct responses. Sources of Fi-
C. premium
nance? Laura have decided to secure a
D. policy bank loan, however they have asked for
her house. What is the correct term for
366. Which of the following is an advantage
this?
of secondary data as compared to primary
data? A. Grant
A. Obtainable from reliable suppliers. B. Assets
B. Move up-to-date. C. Security
C. Usually available in less time. D. Distribution
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 470
372. Which one of the following is an example 377. What are the two purposes of business
of market segmentation? research?
A. Income A. Discovery, generalization
B. Interview B. Truth, verification
C. Questionnaire C. Hypothesis generation, generalization
D. Observation D. Discovery, test of hypotheses
NARAYAN CHANGDER
373. are used to identify customers with 378. Manuel wants to start a new business.
similar wants and needs. He has $50, 000 in savings but needs
an additional $25, 000 to ensure he has
A. Geographic Data enough capital to launch and operate the
B. Customer Survey business. What type of marketing function
is this?
C. Behavioral Research
A. Promotion
D. Market Segmentations Methods
B. Product
374. A description of the person or company C. Pricing
that is likely to buy your product or ser-
vice. D. Financing
A. Target market 379. Which of the following are ways to com-
B. Customer profile pete?
C. Focus group A. Stronger Brand Image
B. Lower Prices
D. none of above
C. Wider Product Range
375. What are the benefits of secondary re-
D. Better Demographics
search?
E. Appealing to a smaller market
A. Less time-consuming
B. More effective for collecting quantita- 380. Which of the following are rewards of
tive data starting a business?
C. More specific A. Business Success
D. Cheaper B. Footfall
E. Always accurate C. Profit
D. Convenience
376. David assists a bride-to-be on helping her
E. Independence
pick out new clothing items for her upcom-
ing honeymoon. Which function of market- 381. The approval for a newly established li-
ing is this? brary policy on Internet use, measured on
A. Product a 5-point Likert scale, (where the anchors
are “Strongly Approve” and “Strongly
B. Selling
Disapprove”) would be an example of a
C. Financing scale.
D. Pricing A. Nominal
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 471
B. Ordinal A. refer to the appropriate publisher’s
C. Interval style manual.
PRACTICE BOOK» NOT FOR SALE
B. ask his coworker for advice.
D. Ratio
C. look up the information in a current dic-
382. Who would deal with-Production tionary.
planning-Producing the product or service- D. identify the readers’ preferences.
Quality control-Stock control-Logistics
A. Human Resources 387. Select 2 ways to carry out secondary re-
search
B. Marketing
A. Focus Groups
C. Operations
B. Books
D. Finance C. Governments statistics
383. Which of the following are ways to add D. Observations
value?
388. Which option is not correlated with qual-
A. More convenience itative research?
B. Unique Selling Point A. answers “why? ”
C. Improved Branding B. only uses a small group of people
D. Lower Variable Costs C. answers “how much? ”
E. Lower Prices D. answers “how? ”
384. Which of the following is a true state- 389. Which source of finance does not have to
ment about qualitative research: be paid back?
A. It is often conducted through experi- A. Share issue
ments B. Government grant
B. It is conducted during a short time- C. Bank loan
frame D. Loan from friends and family
C. It uses large samples of the population 390. What type of communication style is usu-
D. It is based on statistics and facts ally appropriate for evaluation or counsel-
ing interviews with employees?
385. Insights from Instagram about a com-
A. Casual
pany’s social media advertisements is an
example of research. B. Formal
A. Product C. Routine
B. Sales D. Technical
C. Media 391. What is an example of primary re-
search?
D. Qualitative
A. Magazine
386. As Kevin edits a professional report, he B. Observation
is not sure whether to italicize or under-
score a book title. To obtain the correct C. Newspaper
information, Kevin should: D. Government statistics
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 472
392. Which of these is not a method of adding 397. In limited liability personal assets are
value protected
A. Branding A. True
B. Convenience B. False
C. Design C. Neither
D. Price D. Both
NARAYAN CHANGDER
398. What production activity evaluates prod-
393. What are the four Ps?
ucts to make sure that the products the
A. product, price, placement, promotion business produces meet certain quality
B. product, playdoh, placement, promo- standards?
tion A. Form utility
C. print, price, placement, promotion B. Follow-up
D. print, play, product, promotion C. Automation
D. Standardization
394. What benefit does limited liability give
an entrepreneur? 399. Which is an example of a textual graphic
A. More sales that is used in a business report?
B. Access to greater market information A. Pie chart
B. Pictograph
C. Reduced number of competitors
C. Map
D. Protection of personal assets
D. Flowchart
395. Consider the following survey item,
which would be answered with a 5-point 400. sampling is a good method to use
Likert scale:Please rate your satisfaction when conducting a pilot study.
with the amount and kind of service you A. Non-probability
received while in the library. What type B. Non-probable
of question is this?
C. Non-random
A. Contingency question
D. none of above
B. Open-ended question
401. Which of the following is an example of
C. Biased question
a business correctly following employment
D. Double-barrelled question legislation?
396. A business plans to launch a new product A. Paying women more than men for work
by the next ten years. This type of plan of equal value
is: B. Selecting an employee for promotion
based upon gender
A. Long term
C. Paying men and women equal pay for
B. Medium term
work of equal value
C. Short term
D. Selecting an employee for training
D. Immediate based upon ethnicity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 473
402. All of the following questions would be 407. What is a business’s net profit if it has
found in a quantitative survey EXCEPT. $762, 750 in income, $291, 400 in oper-
ating expenses, and $238, 930 in cost of
PRACTICE BOOK» NOT FOR SALE
A. rating scale
goods?
B. Likert scale
A. $471, 350
C. why or how questions B. $523, 820
D. multiple choice questions C. $232, 420
403. In connection with the 4 P’s, which state- D. $368, 730
ment best describes Promotion? 408. Which are true about market maps?
A. Advertising and informing the con- A. Helps to find a gap in the market
sumers about the product
B. Compares against 2 variables i.e.
B. Tv Adverts Price and Quality
C. Carrying out a series of user trials to C. Allows you to meet customer needs
gain consumer reviews of the product
D. Allows you to identify competition
D. Branding the product E. Based on accurate data, doesn’t rely
on opinions
404. What are benefits of segmenting a mar-
ket? 409. Which of the following would you expect
A. Meet specific customer needs to produce qualitative data? (select all
that apply)
B. Differentiate products
A. questionnaire
C. Reduces insurance costs
B. Focus group
D. Increases Interest C. interview
E. Focus on a specific group of customers D. survey
405. The primary reason customers give for 410. An advantage of being a sole trader is
not returning to a business is a lack of:
A. you can take time off whenever you
A. courtesy from salespeople. want
B. available parking. B. you can grow your business really eas-
ily
C. advertised merchandise.
C. you can receive large amounts of fi-
D. customer-service personnel. nance from loans
406. How many Factors of Production are D. you receive all the firm’s profit for
there? yourself
A. 3 411. Cadbury has innovation the Dairy Milk to
contain pieces of Banana. To encourage
B. 6
people to buy the product they price it at
C. 2 45p. This is known as
D. 4 A. Price Reduction
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 474
B. Penetrating Price D. nineteenth century; interchangeable
C. Exported Price parts
D. Promotion E. none of the above
417. Which of the following pricing strategies
412. Which one of the following might be a
describes when the price of a product is
threat to the business, arising from glob-
lowered for a short period of time?
alization?
A. Cost-plus pricing
A. Lower Interest Rates
NARAYAN CHANGDER
B. Loss leader
B. Increased Competition
C. Physiological Pricing
C. More Health and safety Legislation
D. Promotional Pricing
D. Lack of Diversification opportunities
418. A financial plan for a period of time, i.e.
413. Which type of economic system is most how much they have to spend
commonly found in the Caribbean region?
A. Market Plan
A. Traditional economy
B. Business Plan
B. Planned economy
C. Budget
C. Free market economy
D. Cash flow
D. Mixed economy
419. The Macy’s department manager looks at
414. Of the variables of interest in a research merchandise reports to see which products
undertaking, the variable(s) is (are) are not selling. What marketing method is
presumed to be cause of the vari- this?
able(s)
A. Sales Research
A. independent, dependent
B. Consumer research
B. dependent, independent
C. Comparison shopping
C. discrete, continuous D. Consumer Publication
D. dependent, interdependent
420. Adding value to a product will mean that:
415. What are the two methods of creating A. Profit can be made
new ideas
B. Quality is assured
A. Original ideas
C. Customers will buy the product
B. Adapting products
D. No returns are made
C. Copying a competitor
421. Which of the following best describes the
D. Intuition
term stakeholder? An individual or organ-
416. Walter Shewhart, in the , provided isation that:
the foundations for in operations man- A. Owns part of a business
agement. B. Provides a business with materials
A. 1920s; statistical sampling C. Is affected by, or has an interest in,
B. United Kingdom; mass production the activities of a business
C. U.S. Army; logistics D. Provides finance for a business
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 475
422. Which of the following stock control 427. Collateral is needed most when
methods would involve frequent deliver- A. importing goods from new suppliers
ies?
PRACTICE BOOK» NOT FOR SALE
B. lending to family
A. Flow production
C. taking out an annuity
B. Just in case D. borrowing money from a commercial
C. Job production bank
D. Just in time 428. What research looks for open-ended re-
sponses?
423. What best describes market research?
A. Qualitative Research
A. Helping to sell products B. Quantitative Research
B. Recording financial information C. Survey
C. Collecting and analysing data D. Questionnaire
D. Advertising 429. Compared to other methods of promotion,
businesses that promote goods and ser-
424. Which of the following is a possible im- vices on social media have been able to:
pact on UK businesses of paying employ-
ees the national minimum wage A. Reduce costs as online promotion is of-
ten less expensive
A. Costs decrease and profit decreases
B. Increase costs as online promotion is
B. Costs increase and profit decreases always more expensive
C. Costs decrease and profit increases C. Reduce costs as online promotion is al-
ways more expensive
D. Costs increase and profit increases
D. Increase costs as online promotion is
425. Which might be one of the opportunities often less expensive
to businesses arising from globalization?
430. Horizontal integration occurs when
A. Protection from international A. A producer takes over a firm in another
takeovers industry
B. Lower level of inflation B. A producer takes over a competitor
C. an improvement in product quality C. A producer expands production by set-
ting up another firm
D. Lower cost due to economies of scale
D. A producer takes control of one of its
426. Which one of the following could be distributors
classed as a variable cost?
431. I plan to save $1, 500 to buy a used car
A. The managing director’s monthly by saving $75 from each paycheck. Which
salary of £2000 part of a SMART goal is this goal missing?
B. The wages paid at £8.50 per hour A. Time bound
C. The buildings insurance premium of B. Realistic
£590 per annum C. Measurable
D. The rent payment of £1200 per month D. Attainable
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 476
432. When businesses need to formalize the 437. The ability of a country to produce a prod-
information provided to employees, cus- uct at a lower cost than another country is
tomers, or other businesses, they often called
use which type of communication? A. Free trade
A. upward B. Comparative Advantage
B. lateral C. Balance of trade
C. written D. Import quota
NARAYAN CHANGDER
D. verbal
438. Which of the following are a part of the
433. Who managers the following taskRe- role of an entrepreneur?
sponsible for identifying the needs and
A. Taking Risks
wants of business customers and develop-
ing products/services to meet those needs B. Organise Business Resources
A. Human Resources C. Employ People
B. Marketing D. Take out a loan
C. Operations E. Improve convenience
D. Finance 439. A common disadvantage of primary re-
search for a startup is that:
434. Which one of the following is an area
of competitor strengths a business should A. It is time-consuming to obtain
analyse? B. It doesn’t answer the questions asked
A. Total number of employees C. It doesn’t allow for qualitative ques-
B. Standard of customer service tions
C. Location of suppliers D. It can’t be done online
D. Number of competing businesses in 440. Which of the following is an example of
the market internal recruitment? Advertising a job va-
cancy:
435. How is primary research different now
than it was in the past? A. In a job centre
A. It is more enjoyable B. On a firm’s intranet
B. It is more affordable C. In a shop window
C. It is more difficult D. In a local newspaper
D. It is more time-consuming 441. Typical differences between goods and
services do not include
436. Businesses that successfully adapt to cur-
rent market situations often realize that: A. cost per unit
A. more financing is necessary. B. ability to inventory items
B. diversification is the key. C. timing of production and consumption
C. cutting costs is important. D. customer interaction
D. change is an opportunity. E. knowledge content
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 477
442. The main method of causal research is: 447. Pick the two correct stages of the product
A. Observation life cycle
PRACTICE BOOK» NOT FOR SALE
B. Experimentation A. Introduction
C. Survey B. Maturity
D. Classification C. Reducing sales
D. Increasing sales
443. Number of workers Total output per day1
202 353 454 50Use the table above to 448. Which of the following is a reason that
answer the following question.Assuming marketers conduct qualitative research:
capital is fixed, by producing 50 units of
A. To create hypotheses for further test-
output the firm experiences
ing
A. increasing returns
B. To test hypotheses
B. constant returns
C. To make accurate predictions
C. diminishing returns
D. To analyze relationships between mar-
D. diseconomies of scale ket factors
444. Veritiv makes changes to their website 449. Longitudinal research designs will:
so that is is more appealing to customers.
What type of marketing function is this? A. Measure multiple variables at one
point in time
A. Pricing
B. Measure one variable across multiple
B. Product groups at one point in time
C. Financing C. Take a longer time to finish
D. none of above D. Measure the same sample of popula-
tion repeatedly throughout time
445. The “Father of Scientific Management” is
A. Henry Ford 450. Walmart wants to predict future sales of
televisions. Which type of research would
B. Frederick W. Taylor
be used?
C. W. Edwards Deming
A. Media
D. Frank Gilbreth
B. Product
E. just a figure of speech, not a reference
C. Sales
to a person
D. Attitude
446. Which of the following stakeholders
would have the objective of prompt pay- 451. Marketing Research includes all of the
ment for goods and services provided? the following EXCEPT
A. Suppliers A. analyzing data
B. Local community B. reporting findings
C. Employees C. making goods/products
D. Customers D. gathering information
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 478
452. Explain how many people are in a sole 457. In term of research sources, published
trader business? data can be classified into five major cate-
A. 4 gories. Which of the following is NOT one
of them?
B. 1
A. Books
C. 2
B. Periodicals
D. 2
C. Documents
NARAYAN CHANGDER
453. Joe is a Controller when it comes to com-
D. Research reports
munication style. If you are communicat-
ing with Joe, you should make sure you: 458. Which of the following are major disad-
A. get to the point. vantages associated with the collection of
primary data?
B. ask about his family.
A. it provides the most recent data
C. present facts and data.
B. it is typically expensive
D. slow down, take your time.
C. it is connected to your research objec-
454. What is the break even point tive
A. Where sales revenue is the same as D. it is time consuming
fixed costs
B. Where sales revenue is the same as 459. Secondary data has two important ad-
variable costs vantages over primary data. It is:
C. Where sales revenue is the same as A. capable ofcompensating for rapid envi-
total costs ronmental changes and technical improve-
ments.
D. Where fixed costs is the same as vari-
able costs B. alwaysavailable and complete.
C. seldomobsolete and usually fits the di-
455. Which of the following is an advantage mensions of your problem.
to the use of survey methods?
D. generallycheaper to gather than pri-
A. Non-standardization mary data and takes less time to find.
B. High response rates
460. A business that carries out market re-
C. Suitability to tabulation and statistical
search to find customers want/need be-
analysis
fore developing a product.
D. All of the above
A. Product Oriented
456. Which one of the following could be B. Market Oriented
classed as a financial aim for a business
C. Flavour Oriented
start-up?
D. Package Oriented
A. To sell a product line that benefits the
local community 461. In a system of barter, trade is successful
B. Growing the number of employees when
C. Increase profits by 15% A. there is a coincidence of wants
D. To satisfy a personal challenge B. buyers and sellers come together
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.7 Business Statistics and Research Methods 479
C. the goods are of equal value A. each individual does the job for which
D. one party promises to pay later he or she is best suited
PRACTICE BOOK» NOT FOR SALE
B. the economy is at a subsistence level
462. Apple will be most likely to consider of production
which options when choosing a supplier
C. a job is divided into smaller tasks
A. Quantity, delivery time and storage D. a firm maximises output
space
B. Quality, delivery time and reliability of 467. Which of the following statements best
supplier describes the term e-commerce?
A. Buying & selling products via hand held
C. Location of supplier, price and delivery
devices only e.g. smartphones
time
B. Communicating and sharing informa-
D. Price, delivery time and storage space
tion electronically
463. A business that writes letters to cus- C. Buying and selling a product using
tomers to confirm their orders or requests electronic systems e.g. the internet
should make sure that the letters contain: D. Gathering, storing and processing in-
A. product ratings and grades. formation electronically
B. all the necessary information. 468. The entrepreneur should profile the po-
C. exchange rates. tential customers for the new business.
This means that the entrepreneur should
D. a map of all business locations. determine (to the degree possible) the typ-
464. In the model of communication we stud- ical customer’s:
ied we learned that the main parts where A. age & gender
a Sender, a Message, and a B. income level
A. Socializer C. education level
B. Controller D. all of these are correct
C. Receiver 469. Which of these is an example of primary
D. Analyzer research
A. Focus Group
465. Doug is thinking of opening another loca-
tion for his sporting goods store in another B. Internet
area. What type of research would be con- C. Company reports
ducted to determine the best location for
D. Government statistics
his new store?
A. Product 470. Sue is an Analyzer when it comes to com-
munication style. If you are communicat-
B. Advertising ing with Sue, you should make sure you:
C. Sales A. pressure for an immediate decision.
D. Market B. present facts and data.
466. Division of labour can best be explained C. show enthusiasm, smile, and chat.
as a situation in which D. slow down, and take your time.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 480
471. An entrepreneur is 474. Graham wants some quick, informal feed-
A. An established business owner back on his business ideas from friends and
family. His best option would be:
B. An employee
C. Someone who takes the risk of start- A. Share a survey and invite comments on
ing and running their own enterprise. Facebook
D. A shareholder B. Hand a written questionnaire to local
shoppers
472. The credit extended to you by suppliers
NARAYAN CHANGDER
who let you buy now and pay later. C. Send a mailing to 500 local residents
A. Trade Credit D. Commission a local market survey
agency
B. Loan Capital
C. Visa 475. Which of the following is true according
D. Retained Profit to consumer law? A business:
473. Which of the following Pricing Strategies A. Can apply false descriptions to any
describes when you take the cost of pro- goods
ducing a good and add on a percentage of B. Must state the “use by” or “best be-
profit to arrive at the selling price? fore” date on prepacked food
A. Cost-plus pricing C. Does not need to offer a refund if a
B. Low pricing good is found to be faulty
C. Promotional Pricing D. Can sell out of date food products in its
D. High pricing stores to the general public
1.8 Business Management
1. Gradual loss of value because of wear and typical task in the Administrative Support
tear. pathway?
A. depreciation A. Greeting and welcoming customers
B. financial records B. Scheduling and confirming appoint-
C. working capital ments
D. fixed assets C. Equipment operation and maintenance
D. Filing and maintaining documents
2. They bargain with supplier, customers and
others for better quality, lower prices, bet- 4. This is a type of business where investors
ter delivery and prices etc. own shares called stock
A. Negotiators A. corporation
B. Resource Allocators B. monopoly
C. Entrepreneurs C. pool
D. Spokeperson D. conglomerate
3. According to the Business Video presen- 5. Operations management strategies and
tations, which of the following is NOT a practices do not include
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 481
A. Ecological sustainability 10. Which function of management involves re-
B. Economic social sustainability viewing the performance of employees?
PRACTICE BOOK» NOT FOR SALE
C. Sustainability A. Organizing
D. Technological sustainability B. Planning
C. Leading
6. The first level of management in a com-
pany is typically: D. Controlling
A. executives 11. Original facts and figures that businesses
B. supervisors generate.
C. middle managers A. data
D. work coaches B. VoIP
C. information system
7. Of the five value dimensions, which has
been called the most important factor in D. knowledge workers
long-term success?
12. In this function, managers must make sure
A. Innovation that the business has sufficient resources
B. Responsiveness to achieve its objectives.
C. Delivery A. Coordinating
D. Quality B. Controlling
C. Planning
8. A customer asks a salesperson about a
specific advertisement in last Sunday’s D. Organizing
newspaper. Which of the following would
help the salesperson to assist the cus- 13. When an organization relocates one or
tomer? more of its processes to another country,
usually to save on costs.
A. Knowledge of the store’s policies.
A. Global Outsourcing
B. Knowledge of the store’s promotional
budget. B. Outsourcing
C. Knowledge of the products being pro- C. Global Firm
moted. D. Off-shoring
D. Knowledge of the customer’s prefer-
ences. 14. Which of the following are examples of in-
tellectual property that are protected by
9. A customer-service mindset means that a trade-secret legislation:
business considers providing excellent cus- A. Research techniques and artistic
tomerservice to be works
A. moderately important. B. Chemical compounds and manufactur-
B. a top priority. ing processes
C. necessary in certain cases. C. Novels and customer lists
D. its only objective. D. Inventions and trade characters
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 482
15. Which management style would work best 20. Which of the following is an example of a
with employees who have their own spe- middle manager?
cialized jobs and are expert in them?
A. Assistant Principals
A. autocratic
B. teacher
B. democratic
C. CFO
C. open
D. Principal
D. powerful
NARAYAN CHANGDER
21. Why should employees act as if customers
16. What are the four components of the busi- are their employers?
ness process?
A. Customers own the business.
A. Production, Marketing, Finance and
Management B. Employees would not have jobs if there
were no customers.
B. Wholesaling Marketing, Finance and
Management C. Customers pay employees’ bonuses.
C. Production, Manufacturing, Finance D. Employees might work for the cus-
and Management tomers in the future.
D. none of above 22. Which of the following describes small
businesses?
17. The idea “survival of the fittest” is ex-
pressed in the A. Are usually national or global
A. principles of Social Darwinism B. Usually have more than 100 employees
B. concept of assimilation C. Usually have less than 100 employees
C. goals of the Progressive movement D. Can be divided into many different de-
partments
D. melting pot theory of American culture
18. Which of the following is not a key man- 23. James is creating a list of monthly job du-
agement skill? ties for the managers in his section.
A. Communication A. Leading
B. Leading B. Organizing
C. Delegation C. Planning
D. Independence D. Controlling
19. Having clear customer relationship man- 24. A management style that uses delegation
agement goals before putting a program requires
into place helps businesses to avoid A. brand new employees
A. having unsatisfied customers. B. retired employees
B. having to lay off employees. C. experienced and responsible employ-
C. purchasing irrelevant technology. ees
D. spending any money. D. inexperienced employees
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 483
25. A manager decides how many and what 30. What are the benefits for achieving work
kind of people a business needs to meet life balance
it’s goals and then recruits, selects, and
PRACTICE BOOK» NOT FOR SALE
A. reduces stress
trains the right people in this role.
A. planning B. help many employees
B. staffing C. increased employees
C. leading D. enhance corporate image
D. organizing
31. One of the most important aspects of
26. Conducting a semi-annual employee evalu- project management involves
ation with all staff
A. training employees.
A. Planning
B. Organizing / Staffing B. identifying mistakes.
C. Leading C. setting goals.
D. Controlling D. buying supplies.
27. Which level of needs (Maslow) could be
32. It is the level of management whose work
satisfied by organising team building activ-
is to supervise a small work group com-
ities?
posed of non-managerial workers.
A. Self-Esteem
A. Middle management
B. Social
C. Safety B. Top Management
D. Self-Actualisation C. Lower level of management
28. Jill’s company just took on a new project, D. Executive management
and she knows that she needs to decide
which staff members will be in charge of 33. Innovations or new ideas tend to come
each aspect of the project. Jill is from
A. organizing A. Small Businesses
B. planning B. Large Corporations
C. staffing
C. Middle Management
D. controlling
D. Senior Management
29. The invention of machines that allowed for
the faster processing of raw materials be- 34. The part of staffing that involves seeking
gan the transformation of work and busi- out and attracting qualified potential job
ness and led to candidates is called?
A. the need for fewer managers A. training
B. a change from classical management
B. on-boarding
to quality management
C. the Industrial Revolution C. interviewing
D. the decline of labor unions D. recruiting
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 484
35. When raw materials enter and finished C. Inviduals
products leave with little or no human in- D. A company
tervention, it is called?
41. The Sherman Anti-trust Act and the Inter-
A. Automation
state Commerce Commission were both at-
B. Robots are taking over tempts to
C. Wall-E A. regulate monopolies
D. Automated production lines B. prevent large corporations from elimi-
NARAYAN CHANGDER
nating competition
36. The government agency that anyone look-
ing to help with starting a business is the C. protect small businesses
A. Business Agency Group D. all answer choices are correct
B. Small Business Start-Up Agency 42. All authority can be traced in a direct line
from the top to the bottom in
C. The Government Business Assistance
Authority A. a line organization
D. Small Business Administration B. a matrix organization
C. a team organization
37. Bottling machines are usually considered
as D. all of the responses
A. Consumer goods 43. A basic truth or law:
B. Services A. Policy
C. Capital goods B. Principle
D. Capital services C. Skill
D. None of the above
38. The ability to influence individuals and
groups to cooperatively achieve common 44. Issues around globalisation center on
goals A. Legal structure, taxation & staffing
A. team building B. Legal structure, employees & staffing
B. rules C. Business structure, taxation & staffing
C. undertanding D. Legal structure, global market & op-
D. leadership portunities
45. Two significant advantages to using CAD
39. Which of the following forms of income
are:
would be considered unearned income:
A. It allows companies to try various
A. A personal salary
product designs and reduces the time it
B. Interest from a savings account takes to design new products
C. Tips from waiting tables B. It allow companies to try various prod-
D. Union strike benefits uct designs
C. It allows companies to keep the origi-
40. A private sector business is owned by? nal product design
A. 2-30 people D. CAD doesn’t really give companies a
B. Government significant advantage
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 485
46. Entrepreneurship is 51. A business improves its technology so
A. willingly working a lot of hours it can better meet customer wants and
needs. This results from a business activ-
PRACTICE BOOK» NOT FOR SALE
B. willingly risking resources to start and ity known as
run a business in pursuit of profit
A. employee training.
C. is getting permission to run your own
business B. organizational structuring.
D. Making dangerous decisions C. amplified improvement.
47. Which of the following is generally used D. business process management.
by companies with fewer than 50 employ-
ees? 52. A type of power often invested in experi-
enced or well-liked employees is
A. off shoring
A. position power
B. downsizing
B. reward power
C. outsourcing and employee leasing
D. leadership development C. expert power
D. identity power
48. Claims against assets.
A. liabilities 53. Which is NOT a strategy to develop new
B. working capital business opportunities domestically?
C. depreciation A. Franchising
D. financial records B. Online shopping
C. Branching into a new field of business
49. occurs when a business cuts back on
operations to focus on its core activities. D. Extending opening hours
This way does not need to employ as many
workers. 54. An example of this sampling method
is:Being in a room and interviewing first
A. Downshifting
20 people you see. What type of sampling
B. Job Share is that?
C. Outsourcing A. Convenience
D. Teleworking
B. Cluster
50. Edgar Schein described three levels of or- C. Random
ganisational culture:
D. Stratified
A. Task culture, role culture, person cul-
ture 55. A partnership combines the expertise and
B. Organisational attributes, professed resources of?
culture, organisational assumptions A. 1-10
C. Power culture, task culture organiza-
B. 2-10
tional attributes
C. 2-20
D. Organisational attributes, person cul-
ture, professed culture D. 2-30
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 486
56. A career in involves helping an orga- A. Abraham H. Maslow
nization manage its people. This includes B. Fredrick W. Taylor
hiring, training, compensation, administer-
ing benefits and handling personal infor- C. Abraham Lincoln
mation. D. Fredrick Douglass
A. human resources
61. Which of the can lead to a culture clash?
B. administrative support A. Equal comfort levels with diversity
NARAYAN CHANGDER
C. operations management B. Different leadership styles
D. business information management C. Same languages
57. The ability to influence individuals and D. Similar degrees of formality
groups to achieve organizational goals is
62. Measures the results of a process or a
A. management change such as sales, profits, and customer
B. effective human relations service levels.
C. an autocratic style A. Predictive indicator
D. leadership B. Post Indicator
58. The Contingency-Approach consists of C. Leading Indicator
A. Behavioural Approach primarily with D. Lagging Indicator
elements of the Classical approach 63. An helps provide practical experience,
B. An approach where employees can establish professional relationships and in-
work at home troduce you to potential future work envi-
C. Switching between Classical and Be- ronments.
havioural Approaches depending on the A. contract
size of a business B. inventory
D. Using elements of Behavioural and C. associate’s degree
Classical approaches depending on cer-
tain situations D. internship
59. Jerry’s Chicken Shack’s secret sauce has 64. Misleading conduct can be shown when
made the business very popular along A. Businesses provide the product as ex-
the east coast. Other restaurants want pected
the recipe so that they can steal some B. Businesses provide a product that is
of Jerry’s business. Jerry’s secret sauce not entirely made up of what it claims
needs to be protected as a
C. Businesses advertise low prices for
A. trademark goods
B. patent D. Businesses provide the ordered quan-
C. copyright tity of a product
D. trade secret 65. A business that is planning to introduce a
60. determined the “one best way” of per- new product will need a
forming a task or series of task. A. capital budget
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 487
B. cash budget C. employees are going to replace with
C. sales budget robots in the business
PRACTICE BOOK» NOT FOR SALE
D. staff are now much more mobile
D. start-up budget
71. Which of the following is an effect of over-
66. quantitative factors of deciding location staffing?
A. labour costs A. exhausted workers
B. government grants B. low morale
C. room for expansion C. inefficiency
D. environmental concerns D. poor customer service
67. Which of the follow is not an advantage of 72. fulfillment manager, import/export ana-
autocratic management style? lyst, and inventory planner are Posi-
tions?
A. Decision making is quick
A. business analytic
B. Communication is direct
B. office management
C. Decision making is done with employ-
ees C. Supply chain management
D. High regard for efficiency D. HR Management
73. First-line managers deal more directly
68. What are conceptual skills?
with (people) than middle or top-level
A. ability to speak, write, and listen effec- managers.
tively A. Employees
B. ability to formulate new ideas and B. Office supplies
think in abstract terms
C. Equipment
C. specific skills managers need to per-
D. Sales revenue
form duties related to their area of man-
agement 74. Potters Pots has a 26% share of the gar-
D. skills that enable a person to work ef- den pots market in a local city. The market
fectively with others is worth $ 15, 000, 000 per year. What
is the firm’s annual sales revenue?
69. a partnership has A. $ 17, 250, 000
A. between 1 and 20 owners B. $1, 500, 000
B. between 2 and 50 owners C. $3, 900, 000
C. between 2 and 20 owners D. $ 11, 100, 000
D. between 2 and 15 owners 75. The process of planning the physical ar-
rangement of a facility is called
70. What are the effects on staffing needs?
A. Job Design
A. existing employees need to be re-
trained with the use of new technology B. Computer Aided Manufacturing
B. existing employees may need to be re- C. Computer Aided Design
placed with automatic D. Facilities Layout
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 488
76. What does it mean to figure out what your 81. Critical skills necessary to perform the re-
platform will be? quired work-related tasks of a position
A. Identify what your specific policies will A. Leading
be B. Hard Skills
B. Identify how you will take payment C. Controlling
C. Identify where your business will live D. Soft Skills
online
NARAYAN CHANGDER
82. Which one of the following is not a reason
D. Identify how you will ship your product a business fails
77. Lean production allows a business to be- A. Lack of Money
come more B. Lack of time
A. Costly C. Poor management skills
B. Profitable D. Poor location
C. Efficient 83. An efficiency ratio
D. Savvy A. Measures how profitable the organisa-
tion is
78. The quality of a measurement, referring to B. Measures how able to organisation is
its ability to actually measure or predict to pay of its short-term debts
what it intends to measure or predict.
C. Measures how well the capital in-
A. Validity vested into the company is being utilised
B. Reliability D. none of above
C. Effectiveness 84. businesses use organizational design to
D. Efficiency structure their
A. people, information, and technology
79. The saying “form follows function” indi-
cates that organizational design must fit B. people, information, and competitors
with organizational C. information, technology, and competi-
A. image tors
D. technology, people, and competitors
B. objectives
C. facilities 85. Leader who encourages workers to share
in decision-making
D. income
A. autocratic
80. Which of the following Business Functions B. democratic
will organize production in a factory?
C. open leader
A. Human Resource Management D. work rules
B. Finance and Accounts
86. Which of the following is NOT an example
C. Marketing of nonverbal communication?
D. Operations Management A. Flashing lights, stop signs, and sirens
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 489
B. Colors, such as in traffic lights 92. Stated, measurable targets of how to
C. Charts, diagrams, and pictures achieve business aims are called?
PRACTICE BOOK» NOT FOR SALE
D. All are examples of nonverbal commu- A. Business Goals
nication
B. Business Objectives
87. Customer complaints can affect a salesper-
son by C. Business Strategies
A. disappointing her/his friends and fam- D. Business Principles
ily.
B. making her/his day better. 93. A manager may have to choose between
spending money in either promoting the
C. helping her/him to earn a raise
existing portfolio of products or in re-
D. causing her/him to lose commission. search and development for creating new
88. There are 4 key operations Management innovative products
strategies. Which of the following is not A. entrepreneur
one?
B. disturbance-handler
A. Waste Minimisation
B. Recycling of Materials C. resource allocator
C. Lean Manufactoring D. leader
D. Environmental sustainability
E. Inventory Management Systems 94. Shawna is in charge of helping her com-
pany achieve its goals through the proper
89. A sign or indication that something ap- hiring and use of employees. Which type
pears to be a problem is of business management and administra-
A. symptom tion career does Shawna have?
B. alternative A. Supply chain management
C. solution
B. Operations management
D. problem-solver
C. Business analytics
90. The type of power that results from the
manager’s knowledge and skills is D. Human resources management
A. position
95. There are 4 key factors to be considered
B. reward in global sourcing. Which of the following
C. expert is not one?
D. identity A. Impact of currency exchange rates
91. A disadvantage of owning your own busi- B. Tariffs and importing restrictions
ness is
A. long work hours C. A range of individuals from various
backgrounds. education and values
B. doing what you love
C. setting your own schedule D. Legal and cultural differences
D. success E. Political stability in developing nations
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 490
96. Money necessary to start and open a busi- 101. Which of the following is NOT a position
ness is called in the Administrative Support pathway?
A. Seed capital A. Administrative assistant
B. financial statement B. Receptionist
C. Start-up capital C. Customer service representative
D. savings account D. Inspector
NARAYAN CHANGDER
97. A research study that occurs in a natural 102. What employee problem(s) must man-
setting of an organization and where an agers be prepared to deal with?
independent variable is manipulated to de-
A. an employee with serious financial dif-
termine its effects on dependent variables.
ficulties,
A. Field Experiment
B. conflicts between employees
B. Laboratory Experiment
C. problems with customers
C. Field Survey
D. all of the responses
D. Hawthorne Effect
103. Executives are likely to spend most of
98. An important purpose of managemnt is to their time:
the business.
A. controlling
A. design advertising for
B. staffing
B. achieve the objectives of
C. organizing
C. prepare the books for
D. planning
D. compile the financial data of
104. Which of the following is not a purpose
99. Whose theory was “Two factor Theory”-
of market research?
motivators and hygiene factors
A. Providing current information on the
A. Herzberg
activity of the market.
B. Taylor
B. Establishing the likes and dislikes of
C. Maslow customers to reduce the risk of product
D. Pink failure.
C. Predicting future market behaviour
100. What occurs in the planning function of
that assists a business.
management?
D. To identify the sellers’ needs and
A. Coordinating all those involved to
wants in order to understand selling pat-
achieve the company of departmental
terns.
goals
B. Comparing what was planned with the 105. The authority to make decisions and to
actual performance direct the performance of subordinates in
C. Deciding what needs to be done and production, sales, or finance-related activ-
how it will be accomplished ities.
D. Delegating duties to other employees A. Functional Authority
in the company B. Line Authority
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 491
C. Centralized Authority 111. A organisational structure has few
D. Ultimate Authority levels of hierarchy and tends to have a
wide span of control. Decision making is
PRACTICE BOOK» NOT FOR SALE
106. Which of the following is a common way decentralised
for a divisional organizational structure to A. Functional
be broken down:
B. Shamrock
A. By manager
C. Tall
B. By territory
D. Flat
C. By function
D. By job type 112. The management style where all deci-
sion making is centralised, little delega-
107. Pieces of information acquired by observ- tion, and communication is downwards is
ing is called called?
A. Memos A. Persuasive management style
B. Informal Communication B. Aurocratic management style
C. Active Listening C. Centralised management style
D. Reports D. Consulative management style
108. Arbitration ? 113. The process of accomplishing the goals of
A. helps disputing parties make a deci- an organization through the effective use
sion of people and other resources:
B. is an independent 3rd party helps facil- A. management
itate conversation B. leading
C. makes suggestions on how to resolve C. staffing
a dispute
D. organizing
D. independent 3rd party which makes a
final ruling on a dispute 114. The correct order of Maslow’s Needs is:
109. Which of the following is an activity per- A. Physiological, Safety, Social, Self-
formed by businesses? Esteem, Self-Actualisation
A. Generating Ideas B. Physiological, Social, Safety, Self-
Esteem, Self-Actualisation
B. Raising Capital
C. Physiological, Safety, Social, Self-
C. Keeping Records
Actualisation, Self-Esteem
D. All of the Above
D. Physiological, Social, Safety, Self-
110. Relationship marketing pundits estimate Actualisation, Self-Esteem
that it costs five to ten times more to make
115. This is a production method normally as-
sales to than to
sociated with a special “one-off” order. It
A. An existing customer, a new customer is the highest end of the market where the
B. A new customer, a supplier emphasis is on quality and originality
C. A supplier, an existing customer A. Cellular production
D. A new customer, an existing customer B. Bathc production
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 492
C. Job production C. Execution
D. Mass production D. Closing
116. An advantage of a VLE is 121. Dara is in charge of quality control at her
A. People may prefer face-to-face con- company. Which type of business manage-
tact rather than virtual learning ment and administration career does she
have?
B. It can be accessed at any time of the
day in any location A. Office management
NARAYAN CHANGDER
C. A recognised qualification can be B. Operations management
gained C. Business analytics
D. none of above D. Human resources management
117. What is Chapter 7 called? (Holiday 122. An organizational structure where jobs
Homework chapter to read ) are assigned to units or departments by
A. Optimising Operations function.
B. Corporate Social Responsibility A. Product Departmentalization
C. An Introduction to Operations Man- B. Functional Departmentalization
agement C. Unit Departmentalization
D. An Introduction to Employees, Man- D. Functional Organization
agement and Operations
123. A network of linked computers that cov-
118. Managers need to form relationships ers a wide geographic area.
with employees and understand human be- A. WAN
havior. This is an example of which char-
acteristic of directing? B. LAN
A. Executive C. VoIP
B. Continuous D. search engine
C. People-focused 124. Which of the following are the most suit-
D. Creative able strategies in response to the key per-
formance indicator-‘Number of customer
119. The process of selecting a location for a complaints’ (choose 2 answers)
business A. Quality management-increased quality
A. Job Design of output
B. Facilities Layout B. Training and development
C. Site Selection C. Investment in technology
D. Operating System D. Redeployment of resources
120. In which stage of project management 125. What is a set of standards of conduct
does the actual work of the project take which guide decisions and actions based on
place? duties derived from core values?
A. Monitoring and controlling A. Ethics
B. Planning B. Culture
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 493
C. Ideas 131. Sammy is observing her employees as
D. Values they put together furniture. Sammy is
PRACTICE BOOK» NOT FOR SALE
A. rewarding
126. A general term that refers to the move-
B. supervising
ment of information from one location to
another electronically is C. communicating
A. local area network D. instructing
B. an optical network 132. Hospital CEO, nursing home manager,
C. a wide area network and medical clinic manager are all classi-
fied as which business management career
D. telecommunications
A. Health service manager
127. A sampling method that involves placing B. Administrative service manger
all employees in the sample population and
C. Human resource manger
drawing the sample at random.
D. Public relation manager
A. Field Experiment
B. Stratified Random Sample 133. A list of steps to be followed for perform-
ing certain work is a
C. Simple Random Sample
A. process
D. Field Survey
B. goal
128. Taking visitors to dinner and attending C. method
ribbon-cutting ceremonies are part of the D. procedure
A. Figure Head Role
134. Fatima spends most of her time planning
B. Leadership Role and leading at work. She is considered as
C. Liaison Role. a manager.
D. none of above A. first line
B. middle level
129. Which of the following is not a typical
business objective? C. top
D. lower level
A. Meet shareholder expectations
B. Profit 135. Which is the characteristic of a traditional
work team
C. Increase market share
A. one or two broad tasks
D. Mass production
B. team leader controls routine tasks
130. A person who is paid to perform manage- C. effectiveness based on team perfor-
ment functions within a particular job mance
A. professional managers D. group decision making
B. entrepreneurs
136. An chart shows how the business is
C. glass ceiling structured and who is in charge of who.
D. principle A. Time
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 494
B. Organizational C. To ensure that maternity leave is ac-
C. Staff cessible to all
D. Management D. To ensure that people from minorities
get access to interviews
137. What protects you in the event that you
harm someone or damage any of their 142. Which of the following is probably the
property? least important factor in becoming an en-
trepreneur?
A. property insurance
NARAYAN CHANGDER
A. having a desire to be your own boss
B. liability insurance
B. living in a major city
C. life insurance
C. having special skills and abilities
D. The IT guy
D. developing a good business plan
138. Managers who are responsible for pro-
ducing goods and services for a company 143. Which of the following are the three ma-
jor areas of customer complaints?
A. Operations Managers
B. Production Managers A. Poor service, inaccurate forms, and
rudeness.
C. Activity Scheduling
B. Improper decisions, oversight, and
D. Supervisiory Managers service.
139. Which business strategy am I? Providing C. Labeling, faulty design, and mispric-
unique products and services in ways that ing.
are widely valued by buyers (i.e. high D. Product, personnel, and the business.
quality, extraordinary service, innovative
designs, etc). 144. The project manager controls what the
A. Focus project will and will not do, known as the
project’s
B. Differentiation
A. budget
C. Analyzer
B. plan
D. Prospector
C. schedule
140. the ratio of outputs to inputs during pro-
D. scope
duction
A. production 145. Which tasks would be performed by
someone in an Administration and Informa-
B. level of production
tion Support career?
C. productivity
A. analyzing information to predict future
D. none of above sales and supervising others
141. What is the purpose of affirmative action B. answering telephone calls and filing
legislation? paperwork
A. To improve the career prospects of tra- C. training employees and administering
ditionally more disadvantaged people employee benefits
B. To ensure that women get all the top D. hiring and firing employees and ap-
jobs proving budgets
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 495
146. Which form of promotion is generally em- management. What directing activity is
phasized for complex, technical products Thomas engaging in?
sold to industrial users?
PRACTICE BOOK» NOT FOR SALE
A. Motivating
A. Personal Selling
B. Communicating
B. Sales Promotion
C. Instructing
C. Publicity
D. Supervising
D. Advertising
152. TQM stands for?
147. This assumes people are generally lazy
A. Total Quality Management
and will avoid work if they can:
B. Total Quality Marketing
A. Theory X
C. Total Quality Monitoring
B. Theory Y
D. Total Quality McDonald’s
C. Theory Z
D. TQM (Total Quality Management) 153. Devising strategy to expand the business
internationally is
148. What is not an example of financial mo-
A. Planning
tivation?
B. Controlling
A. Pay rise
B. Bonus C. Leading
C. Piecerate D. Organizing
D. Praise 154. Stacey works at a fancy gift shop. Many
of the items in the shop are expensive col-
149. A broad guideline for managers to follow lectibles, and Stacey is very knowledge-
when dealing with important areas of de- able about them. Today, a man comes in
cision making is called looking for a gift for hiswife. Stacey of-
A. procedure fers to help, but he just grunts at her and
turns his back. Stacey’s customer is
B. form
A. impatient.
C. policy
B. leave-me-alone.
D. documentation
C. insulting.
150. Which of the following drives could be
D. argumentative.
satisfied with bonuses or performance-
related pay? 155. What are the four types of employee ex-
A. Drive to Bond pectation
B. Drive to Learn A. employment conditions
C. Drive to Acquire B. employee expectation
D. Drive to Defend C. remuneration
151. Thomas is listening to his employees’ D. job security
ideas about how to improve their time E. work-life balance
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 496
156. Who is normally responsible for purchas- 161. What management function is being de-
ing the proper material resources for work- scribed in the following situation:Tatyana,
ers to use in doing their jobs? atop-level manager, identifies jobs to
A. Middle managers be performed, assigns responsibility for
them, establishesdepartments to handle
B. First-line workers the jobs, and determines how many and
C. Supervisory managers which employees mid-level managers will
D. Top-level managers supervise.
NARAYAN CHANGDER
157. Which of the following is not a character- A. Directing
istic of a service B. Controlling
A. Minimal customer contact
C. Planning
B. Difficult to store
D. Organizing
C. Intagngible
D. Labour Intensive 162. production involves transforming
158. The accumulated knowledge and skills of raw materials into goods.
human beings and the total value of each A. Primary
person’s education and acquired skills are
called B. Tertiary
A. Human capital C. Secondary
B. Human potential
D. Quatenary
C. Human knowledge
D. Human labor 163. Which of the following tasks would a
manager complete when organizing?
159. To demonstrate a customer-service mind-
set, employees must believe that cus- A. Hiring employees
tomersdeserve their
B. Arranging an office space
A. unsolicited advice.
C. Training staff
B. limited information.
C. complete attention. D. Writing a marketing plan
D. personal opinions.
164. Which of the following could be used to
160. To avoid pitfalls in planning, managers satisfy Maslow’s Self-Esteem Needs?
should
A. Provide employees with a free break-
A. only look at the one plan and focus on fast at work
that
B. Organise a staff lunch at a restaurant
B. look at the big picture and long term
every Friday
goals
C. look at what other companies are do- C. Introduce an ‘Employee of the Week’
ing Award
D. make sure their mid level managers D. Introduce flexible working hours so
are not calling in sick staff can start their working day later
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 497
165. This method reduces the amount of stock 170. What is one of the purposes of having
held by ensuring products are made only business policies?
when ordered
PRACTICE BOOK» NOT FOR SALE
A. To encourage customers to make fre-
A. Just-in-time quent exchanges.
B. Cradle-to-cradle B. To make sure the business’s actions
are consistent.
C. Total quality management
C. To ensure that the business makes a
D. Benchmarking profit.
166. How would you classify a manager that’s D. To allow employees to make decisions
in charge of a department? regarding customers
A. Top-Level Manager 171. Maintenance and repairs is an operations
activity that includes
B. Operational Manager
A. site selection.
C. Middle Manager
B. production planning.
D. Low-Level Manager
C. custodial work.
167. Managing reservations, banquets and D. financial analysis.
housekeeping are examples of duties for
which business management career? 172. The stated duty to deal with something,
having control over someone, OR the
A. Administrative service manager
opportunity or to act independently and
B. Health admin. make decisions without authorization
C. Hotel manager A. Productivity
D. Public relations manager B. Manager
C. Coordinator
168. To manage time efficiently, supervisors
must be able to D. Responsibility
A. determine the work to be done 173. Gross Domestic Product is calculated by
B. set priorities for the most important
work A. Total market value of production over
a set amount of time minus costs of pro-
C. ensure that the work is completed duction
properly and on time
B. Total market value of production annu-
D. do all of these activities ally minus tax costs
169. Process of recruiting, hiring, training, C. Total market value of production over
evaluating, and compensating employees a set amount of time plus costs of produc-
tion
A. Staffing
D. Market value of a product minus costs
B. Leading of production
C. Controlling
174. Which of the following jobs are not easily
D. Organizing replaced by automation and technology?
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 498
A. Mail sorter 179. CSR stands for
B. Stock clerk A. corporate socialite responsibility
C. structural metal fabricator B. corporate social responsible
D. Travel agent C. co-operative social responsibility
175. Franklin reviews financial data of a com- D. corporate social responsibility
pany to ensure accurate and complete in-
formation. Which job title does he most 180. In Maslows Hierarchy, physiological
NARAYAN CHANGDER
likely have? needs refer to:
A. Financial Manager A. Food and water
B. Accountant B. Affection
C. Credit Analyst C. Recognition and Respect
D. Auditor D. Personal Growth
176. If a manager sees that actual expenses 181. As managers are faced with many of
are exceeding budgeted amounts, he or the challenges presented by a multicultural
she should immediately workplace, there is a greater need for
A. Do nothing and see if things change toward issues.
B. Discard the old budget and develop a A. staffing
new one B. communicate
C. Review expenses to see what can be C. change
done to reduce them
D. sensitivity
D. Increase the prices of products to im-
prove sales 182. Electronic digital computers were devel-
oped in the
177. Which of the following accounting state-
ments answers the question, “How prof- A. 1920s
itable is the firm? ” B. 1940s
A. income statement C. 1960s
B. balance sheet D. 1980s
C. statement of financial positin
183. What should salespeople do when they
D. cash budget
must cope with customers who are being
178. Which of the following is something you disagreeable?
should NOT concern yourself with when A. Speed up the sale to minimize opportu-
making an ethical decision? nity for disagreement.
A. Is it legal? B. Use product knowledge to prove they
B. Is it cost effective? are wrong.
C. Is it beneficial? C. Listen patiently and try to stay calm.
D. Could my family and managers respect D. Ask them to come back when they are
my decision? ready to buy.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 499
184. Carpal tunnel syndrome is a health prob- 189. What procedure is used to evaluate the
lem related to the work and accomplishment of an employee
and provide feedback about how well the
PRACTICE BOOK» NOT FOR SALE
A. elbow
employee is meeting expectations?
B. shoulder
A. what-if analysis
C. lower back B. coaching
D. wrist C. contingency plan
185. A business must have a that parties D. performance review
follow to resolve resolutions 190. A manager who realized that each em-
A. Arbitration conciliation process ployee has different background as well
as different attitudes, skills and needs
B. Dispute resolution procedure
demonstrating the human relations skill of
C. Award agreement procedure A. communication
D. Dispute collective agreement B. self-awareness
186. Entrepreneurs C. employee empowerment
D. understanding others
A. cannot tolerate ambiguity or uncer-
tainty 191. factors that cause average costs of pro-
B. must have a business degree duction to rise when the scale of operation
is increased
C. are unable to problem solve and learn
from failure A. purchasing problems
D. come from all ages, race, and educa- B. alienation of the workforce
tional backgrounds C. coordination problems
D. financial
187. a total commitment by everyone in an or-
ganization to improve the quality of pro- 192. Which of the following is NOT what dy-
cedures and products by reducing waste, namic companies have in common that
errors, and defects makes them successful?
A. classical management A. Hiring Carefully
B. administrative management B. Controlling Cost
C. behavioral management C. Centralization of Authority
D. quality managment D. Accepting Change
193. A type of termination in which an em-
188. A financial plan used to determine when
ployee leaves the business to pursue work
to replace or purchase fixed assets.
elsewhere.
A. capital budget A. Retirement
B. operating budget B. Dismissal
C. cash budget C. Redundancy
D. start-up budget D. Resignation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 500
194. Which of the following is not one of the 199. If a company continuously fails to deliver
five steps of the delegation process? on its brand promise, it will probably:
A. Authority A. decrease liability.
B. Briefing B. improve sales volume.
C. Control C. increase market share.
D. Appraisal D. lose credibility.
NARAYAN CHANGDER
200. reductions in a firm’s unit costs of pro-
195. Revise the policy in the policy develop-
duction that result from an increase in the
ment process is step
scale of operation
A. 2
A. communication economies
B. 3
B. technical economies
C. 4 C. coordination economies
D. 5 D. marketing economies
196. Which of the following is a benefit of us- 201. This role requires you to make changes
ing project management software: in policies or resolve conflicts in the work
A. Improved efficiency place as a manager.
B. Less need for management A. Information-Related Role
B. Decision Making Role
C. Smaller project team size
C. Interpersonal Role
D. Better governance mechanisms
D. Required Roll
197. is a form of innovation directly asso-
ciated with the technical development of 202. College presidents, school superinten-
existing products or processes or the cre- dents, and school principals are all classi-
ation of new ones. fied as which business administrator?
A. Operations management A. Education admin.
B. Human resource manager
B. Research & development (R & D)
C. Administrative admin.
C. Total quality management
D. Public relations manager
D. Kanban
203. Acquire businesses in different stages of
198. Operations management involves produc- production
ing goods, quality control, managing the
supply chain, product development, of A. Chain of Production
goods and purchasing of external prod- B. Vertical Integration
ucts. C. Horizontal Integration
A. selling D. Virtual Integration
B. warehousing
204. Which of the following statements is true
C. storing about conflict?
D. shipping A. All conflict should be avoided
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 501
B. A little conflict is sometimes beneficial 210. According to the SBA, a small business is
C. Win/lose strategies are most often an independent business with fewer than
employees.
PRACTICE BOOK» NOT FOR SALE
used by manager
D. Managers should not compromise or A. 10
they lost authority B. 50
205. To determine the creditworthiness of peo- C. 100
ple or organizations, businesses apply the
D. 500
A. Four C’s of credit 211. What will earn leaders commitment and
B. 80/20 rule loyalty from a group member?
C. “Keep it simple” policy A. Exhibiting trust and respect
D. Minimum approval rate standard B. Shouting at subordinates
206. What management function involves C. Being a poor role model
monitoring customer satisfaction?
D. none of above
A. Planning
B. Leading 212. In which role are managers acting when
they represent their organization and
C. Organizing
maintain effective relationships?
D. Controlling
A. relationship builders
207. One disadvantage of the differentiation
B. communicators
strategy
A. Costs are often increased C. middle managers
B. Brand loyalty is reduced D. decision makers
C. It can lower quality
213. is monitoring progress toward goal
D. None of the above achievement and taking corrective action
when needed
208. Management and Administration are
A. Same A. Planning
B. Different B. Organizing
C. Partly same and partly different C. Leading
D. same and different D. Controlling
209. The chain of command from the highest 214. A sentence describing the purpose of the
authority to the lowest level in the orga- business is called
nization is
A. business plan
A. Unity of direction.
B. Unity of command. B. mission statement
C. Centralization. C. market analysis
D. Scalar chain. D. projection
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 502
215. Which of the following is NOT a respon- 220. Which of the following is the ability of
sibility of a manager or supervisor? team members to give up an idea of their
A. Guide the activities of the business own to consider or use ideas of others?
B. Keep the business moving toward set A. Cooperation
goals
B. Compromise
C. Identify exceptional employees
C. Conglomeration
D. Set goals for the business
NARAYAN CHANGDER
D. Collaboration
216. What are the four main strategies to im-
prove efficiency and effectiveness of oper-
ations? 221. The ability of an operations system to
offer customer value is determined by?
A. Just in time, TQM, Waste minimisation (Identify all)
B. TQM, Materials Management, Waste
A. Productivity, quality, speed, reliability,
minimisation (lean Management), Tech-
flexibility
nology
C. Quality, Technology, Materials Man- B. Productivity, quality, speed, reliability,
agement, Facilities layout trust, flexibility
D. Technology, Materials Management, C. Productivity, quality, speed, reliability
Quality, Lean Management
D. Productivity, quality, speed, reliability,
217. This training is not focused on a particular flexibility, teamwork
aspect of the business. It helps employees
develop thinking and processing skills. 222. Why is it important for managers to pro-
A. Cognitive training vide stability through direction?
B. Behavioral training A. Instability leads to greater chance of
C. On-the-job training high reward.
D. Induction B. Employees who feel secure are more
productive and happier.
218. How are horizontal organizations orga-
nized? C. By providing stability, managers can
A. By managers eliminate risk.
B. By teams D. Companies that have stability struggle
C. By process to guide employees’ work.
D. By coaches
223. Most of the money needed to start a busi-
219. Michelle is attending a monthly meeting ness comes from
with other company managers to hear up-
A. the owner and his/her family and
dates about what each manager is doing.
friends
A. Leading
B. selling stock
B. Planning
C. Controlling C. bank loans
D. Organizing D. credit from other businesses
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 503
224. A performance management strategy in 229. The important principles that guide deci-
which feedback is provided by managers, sions and action in a company are called
customers and other employees. values.
PRACTICE BOOK» NOT FOR SALE
A. Employee Observation A. ethical
B. Management by Objectives B. beliefs
C. Appraisal C. core
D. Self-Evaluation D. leadership
225. Marketing is? 230. Companies that contract with employers
to manage human resource functions and
A. The idea that a business should strive employer liability by contractually assum-
to satisfy consumer wants and needs ing employer rights and responsibilities.
while achieving company goals.
A. Third-Country National (TCN)
B. the shop
B. Multinational Enterprise (MNE)
C. Must also determine how much cus-
C. Global Firm
tomers are willing to pay.
D. Professional Employer Organization
D. none of above (PEO)
226. As employees go about their daily ac- 231. A main goal of customer experience man-
tivities, their actions should be driven by agement is creating
whether the actions will:
A. innovative technology.
A. be witnessed by customers.
B. higher employee salaries.
B. result in additional sales.
C. new products.
C. bring them personal fulfillment.
D. word-of-mouth promotion.
D. result in customer satisfaction.
232. Those who gained their riches at the ex-
227. Which of the following is not a role of the pense of the poor and working class are
FWC? called
A. Create Awards A. philanthropists
B. Handle unfair dismissal cases B. robber barons
C. Create agreements C. entrepreneurs
D. Provide information to businesses re- D. big businessmen
garding pay and conditions
233. Workplace relations laws exist for what
228. How many National Employment Stan- reason?
dards are there? A. To protect the relationship between
businesses and consumers
A. 5
B. To support and protect the relationship
B. 8
between employees and employers
C. 10
C. To improve education and training for
D. 12 employees
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 504
D. To review policy and legislation pro- 239. A boutique owner set a goal to open two
tecting staff additional stores in the next three years.
What type of organizational goal has the
234. Managers within their information- boutique owner set?
related roles to provide knowledge, news,
or advice to employees. A. Control
A. communicate B. Growth
B. change C. Profit
NARAYAN CHANGDER
C. deductions D. Market share
D. sensitivity
240. Workers deliberately work below their
235. A refusal to work organised by a body of potential
employees as a form of protest, typically
in an attempt to gain a concession or con- A. Collective bargaining
cessions from their employer. B. Lock-out
A. Strike C. Go slow/slow-down
B. Lock-out D. Work to rule
C. Go slow/slow down
241. What is the job of a business manager
D. Work-to-rule
A. oversee the activities of workers
236. Which of the following activities of super-
visors relates most directly to quality con- B. ensure that a company or department
trol? is on track to meet its financial goals
A. developing work schedules C. hire, train and evaluate new employ-
B. developing and checking standards ees
C. using effective listening skills D. All of the above
D. setting priorities so that the most im- 242. The difference in value between exports
portant work gets done and imports of a nation
237. What are three functions of manage- A. Export deficit
ment?
B. Balance of trade
A. Control, plan, organize
C. Trade equilibrium
B. Lead, communicate, plan
D. Trade quota
C. Control, plan, oversee
D. none of above 243. What component of customer rela-
tionship management often “makes or
238. Radio, Television, and Billboards are ex-
breaks” a business’s program?
amples of
A. public relations A. Processes
B. sales promotion B. People
C. advertising C. Technology
D. personal selling D. Strategies
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 505
244. The general way a manager treats and 249. Software that provides online ordering
supervises employees is called capabilities for shoppers is known as
PRACTICE BOOK» NOT FOR SALE
A. human relations A. an electronic shopping cart
B. management B. a virtual scanner
C. power C. point-of-sale software
D. safe host order processor (SHOP)
D. leadership style
250. The type of manager who works most di-
245. Which of the following is not a task rectly with employees on a daily basis is
suited to delegation?
A. an executive
A. Tasks from part of a larger project
B. a mid-manager
B. Training and development C. a supervisor
C. Organisation of data D. none of these
D. High risk decisions 251. What is Unit 3, AOS3 called?
246. Which of the following is NOT an effec- A. Employee Relations
tive practice in enforcing work rules? B. Managing Employees
A. Provide written copies of all rules to C. Managing a Business
employees D. Operations Management
B. Consider special circumstances be-
252. Organisational slogans, statements or
fore determining the penalty.
images give clues to how the organisation
C. Punish in public and praise in private operations.
D. All are effective practices A. Role culture
B. Task culture
247. Ownership of a corporation is divided
into parts called C. Organisational attributes
D. Professed culture
A. Shares
B. Corporation parts 253. A project is officially authorized to begin
by the
C. Memberships
A. registration documents.
D. Partnerships
B. Initiation Papers.
248. A form of mass production in which the C. project charter.
flow is broken up by teams of workers D. statement of work.
who are responsible for certain parts of
the line. 254. An advantage of batch production
A. Cellular manufacturing A. high level of worker motivation
B. some flexibility in design of product in
B. Batch production
each batch
C. Customized production
C. low unit costs due to constant working
D. Batch production machine and high labour productivity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 506
D. ability to undertake specialist projects C. chief office
or jobs D. investor
255. When a business evaluates its business 260. Continuous process of comparing actual
processes to make them more efficient and outcomes with planned outcomes and tak-
effective, it can improve its relationships ing appropriate actions when goals are not
with customers. This process is called met
A. employee training. A. Staffing
NARAYAN CHANGDER
B. organizational structuring. B. Leading
C. continuous improvement. C. Organizing
D. business process management. D. Controlling
256. Which of the following is NOT a trait of 261. A cashier at a family dining restaurant
aggressive personalities? placing his finger on a fingerprint scanner
before he can operate the cash register is
A. Helpful an example of
B. Impatient A. identity protection
C. Obnoxious B. a search engine
D. Pushy C. biometric security
257. What are the five value dimensions you D. data mining
need to focus on to get the value mix right 262. Which section of the business plan de-
and satisfy customers? scribes the business?
A. Cost, delivery, quality, information, A. 3
and technology
B. 1
B. Cost, quality, delivery, responsive-
C. 2
ness, and innovation
D. 4
C. Quality, delivery, innovation, flexibility,
and agility 263. The combination of the unique qualities
D. Responsiveness, innovation, flexibility, that make you who you are is known as
agility and quality your
A. interests
258. Human is the way people get along
B. interests
with each other.
C. personality
A. relations
D. ability
B. initiative
C. leadership 264. What type of leadership relies heavily on
the use of policies, procedures and regula-
D. style tions?
259. A person who risks his/her own money A. Authoritarian
to create a new business is called a B. Democratic
A. monopolist C. Laissez-faire
B. entrepreneur D. Dictatorship
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 507
265. What is meant by the glass ceiling? C. Maslow
A. difficulty of maintaining a small busi- D. Fiedler
PRACTICE BOOK» NOT FOR SALE
ness profitably
270. What is it called when a leader has the
B. threats from competitors ability to give or withhold rewards
C. invisible barrier that once kept women A. Reward influence
and minorities from being promoted to
upper-level positions B. Expert influence
C. identity influence
D. difficulty of introducing new products
in the market D. Position influence
266. Which analyst position analyzes informa- 271. This intellectual property protects owner-
tion using mathematical models to help ship to logos, slogans, designs, phrases
business managers make decisions? and things that are distinctive to the de-
sign such as the color, shape, wording for
A. Budget Analyst
a product is a
B. Management Analyst
A. Trade dress
C. Credit Analyst
B. Copyright
D. Operations Research Analyst C. Patent
267. Which of the following is a contemporary D. Trademark
challenge in social issues?
272. Monitoring the opportunity for loss for a
A. health care laws business.
B. leadership development A. Risk assessment
C. tax rates B. Risk retention
D. downsizing C. Risk management
268. Beginning in high school, a person think- D. Risk transfer
ing about becoming a human resource man-
273. Gathering and analyzing of information
ager should take required core curriculum
about a business is
courses, which include-
A. collateral
A. math, physics, art, and band
B. mission statement
B. athletics, science, spanish and English
C. market research
C. math, science, social studies, and En-
glish language arts. D. business plan
D. math, history, geometry, and spanish 274. Person who completes all five manage-
ment functions on a regular basis and has
269. The idea that most people are motivated authority over other jobs and people
by their need for achievement, power, and
affiliation is most closely associated with A. manager
B. supervisor
A. Herzberg C. employee
B. McClelland D. worker
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 508
275. A manager is crucial to a business’: 280. A Liquidity ratio
A. Innovation A. Measures how profitable the organisa-
B. Human Resources tion is
C. Efficiency B. Measures how able the organisation is
to pay its short-term debts
D. All of the above
C. Measures how well the capital in-
276. A cash budget is used to vested into the company is being utilised
NARAYAN CHANGDER
A. Identify the profit which has been
made from the overall year D. none of above
B. Forecast the amount of money ex- 281. attributes necessary for effective leader-
pected to be received or paid out over a ship are?
period of time
A. Diagnosing, adapting & communicat-
C. Calculate the gross and net profit ing
D. none of above B. Adapting, leading & communicating
277. If a person wants to work from home C. Diagnosing, leading & communicating
in the Business, Management and Admin- D. Communicating, expendable & leading
istrative careers, what is required?
A. a cubicle to keep the person on task 282. Which sector of the economy involves ex-
traction of raw materials, farming, fishing,
B. a private office to protect confidential forestry and mining?
information
A. Secondary sector
C. proper technology to keep the person
connected B. Primary sector
D. proper travel arrangements to meet C. Quaternary sector
with customers D. Tertiary sector
278. Overseeing the personnel department of 283. How do businesses aim to satisfy the
a company, including posting job vacancies, needs and wants of individuals and orga-
screening resumes, and setting interview nizations?
appointments are examples of job duties A. Creating a product
for which business management careers?
B. Providing a service
A. Adminstrative admininstration
C. Extracting raw materials
B. Education adminstration
D. All of the options
C. Human resource adminstration
D. Public relation manager 284. Which of the following is an example of
on-the-job training?
279. Which of the following is not a common A. Undertaking an online module at home
legal structure for a business?
B. Attending a lecture by an industry ex-
A. Government pert
B. Sole trader C. Role playing during an interview
C. Partnership D. Being assigned a mentor to help you
D. Company during shifts
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 509
285. Which management career often requires 291. Corporate culture
a master’s degree? A. refers to the transition, ideas, expec-
PRACTICE BOOK» NOT FOR SALE
A. administrative services manager tations and beliefs shared by members of
B. operation managers the organisation.
C. compliance managers B. refers to the values, ideas, expecta-
tions and beliefs shared by the external
D. chief executives community.
286. Which of the following is not a basic func- C. refers to the values, ideas, expecta-
tion of management? tions and beliefs shared by members of
A. Planning the organisation.
B. Leading D. none of above
C. Organizing 292. What is the correct order of organiza-
tional levels?
D. Administering
A. Operative employees, supervisors,
287. The purpose of a policy is to middle managers, top management
A. make everyone follow the rules B. Supervisors, middle managers, opera-
B. to make the work place regimented tive employees, top management
C. to give the boss scope to fire you C. Operative employees, supervisors, top
managers, middle management
D. to promote a positive culture
D. Top management, operative employ-
288. Personal computers and software that ees, supervisors, middle managers
allowed individuals to enter and process
their own data were developed in the 293. Data that are stored on the cloud reside
on
A. 1960s
A. computers at a central location.
B. 1980s
B. weather satellites.
C. 1970s
C. widely dispersed Internet networks.
D. 1990s
D. small light-weight disposable chips.
289. Are Non-Profit social enterprises
294. How many parts are there to a business
A. Charities
plan?
B. PPP A. 1
C. NGOS B. 3
D. Sole Traders C. 2
290. the number of levels of management that D. 4
a business needs usually depends on the:
295. the tendency of a business to continue
A. Location of the facility along its current trajectory due to a lack
B. age of the employees of enthusiasm to change?
C. goals of the company A. Restraining Force
D. Size of the business B. Poor Motivation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 510
C. Straight Line Theory 301. a financial reward system where em-
D. Organisational Inertia ployee pay is tied to their performance?
A. Incentives
296. People in the first level of management
B. Bonuses
in a company are known as
C. Performance Management
A. executives
D. Performance Related Pay
B. supervisors
302. An important aspect of using technology
NARAYAN CHANGDER
C. middle managers
in customer relationship management in-
D. trainees volves:
297. Production of a group of identical prod- A. providing customers with excessive
ucts for example car models with differing product information.
features for each model. B. posting customer information on the
A. Match production business’s web site.
B. Batch production C. allowing employees to have complete
access to customer information.
C. Mass production
D. updating customer information in the
D. Cellular production computer database.
298. James is creating a list of monthly job du- 303. How can managers coordinate employ-
ties for the managers in his section. Which ees’ activities?
business management function is he per-
A. Tell them what to do.
forming?
B. Give them the equipment they need.
A. Organizing
C. Share organizational charts with them.
B. Planning
D. Evaluate their results.
C. Leading
D. Controlling 304. A broad, long-term and often inspira-
tional view of a company’s reason for ex-
299. A written document that outlines the istence
goals for a business and how they plan to A. values
reach those goals.
B. vision
A. Business Plan
C. process
B. Cash Flow Statement D. procedure
C. Mission Statement
305. Which of the following are examples of
D. Honor Code middle-management job titles:
300. What is dispatching A. Floor supervisor, area supervisor, and
section manager
A. Assigning roles
B. President, senior vice president, and
B. Job Design
chief executive officer
C. Scheduling of Each Task C. Collections supervisor, crew chief, and
D. none of above production supervisor
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 511
D. District manager, department head, A. controlling
and regional sales manager
B. leading
PRACTICE BOOK» NOT FOR SALE
306. Business Management C. planning
A. Keeping the company on track and D. organizing
making sure all goals are met
B. Direct control of a business or enter- 311. CAM stands for?
prise; working with people and using re- A. Competitors As Motivation
sources effectively and efficiently to ac-
complish organizational goals B. Computer Aided Manufacturing
C. deciding how the company will get the C. Computer and Management
work done to accomplish the goals D. Computer Aided Marketing
D. An employee in charge of everyone and
everything 312. Payal wants to be a marketing manager.
What qualification would best help her in
307. This man used the assembly line to revo- getting a job in this career?
lutionize the automobile industry
A. creativity and skills for analyzing his-
A. Henry Ford torical information
B. Andrew Carnegie B. integrity and organizational skills
C. John D. Rockefeller C. ability to handle correspondence
D. JP Morgan
D. long-term planning skills for setting
308. When employees are not confident in business goals
their abilities or do not trust their man-
ager, they are likely to be ineffective with 313. Which of the following describes the ac-
tion of assigning authority to someone
A. a democratic leader else to carry out a task?
B. an open leader
A. administer
C. an autocratic leader
B. micromanage
D. all of the responses
C. empower
309. Management can be ranked in a , D. delegate
which groups each management level in or-
der of importance. 314. If some employees do not seem to enjoy
A. change their work, a manager can
B. staffing A. ignore the problem because the atti-
C. sensitivity tudes will change
D. hierarchy B. punish them by giving them tasks they
dislike
310. Bryan is conducting a monthly analysis
C. find opportunities to involve the em-
to see if his department has performed
ployees in decisions
all the tasks and objectives they set for
the month. Which management function is D. tell them to change their attitude or
this? they will be terminated.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 512
315. For bulk increasing, i.e. buying many D. training other employees how to use a
components and building something larger, computer
the business should consider locating near
320. A ‘discuss’ question on the exam, means
I am required to?
A. Raw materials
A. Explain it in detail
B. Market
B. Summarise the topic
C. Suppliers
C. Look at the positives and negatives of
NARAYAN CHANGDER
D. Stockholders the topic
316. Which of the following is an example po- D. Cry
sition in the General Management path-
way? 321. Which of the following is not considered
a level of management in the management
A. Business intelligence analyst pyramid?
B. Director of market intelligence A. senior management
C. Small business owner B. authority management
D. Labor relations specialist C. middle management
317. The Equal Opportunity Act 2010 is a D. supervisory management
A. Victorian Law 322. Which of the following is a true state-
B. A Commonwealth Law ment about the matrix organizational
structure:
C. A local council Law
A. It lacks flexibility.
D. none of above
B. It includes only line authority.
318. Mental models are
C. It gives managers a wide span of con-
A. Deeply ingrained individual assump- trol.
tions and bias D. It is useful for most types of organiza-
B. Motivational theories such as tions.
Maslow’s Hierarchy
323. Samantha is conducting interviews with
C. The mental health of each employee potential employees to find a replacement
D. Psychological mumbo jumbo for a worker who retired.
319. Louisa works in Marketing. She works A. Leading
with several different areas of the com- B. Controlling
pany that employs her. Which task does C. Organizing
Louisa have others perform?
D. Planning
A. conducting meetings at a satellite of-
fice 324. A certain electronics brand portrays the
B. working on new marketing campaigns characteristics of youth, energy, and hope-
at home fulness. This is an example of
C. participating in teleconferences in her A. brand personality
home office B. brand promise.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 513
C. business environment 329. In management, a primary organizing ac-
tivity is?
D. corporate culture.
PRACTICE BOOK» NOT FOR SALE
A. evaluating job performance.
325. Mia decides to change a future dead-
line on her project’s schedule because she B. controlling external conditions.
knows that, based on her team’s perfor- C. assigning responsibility.
mance, they will not meet the deadline.
D. hiring talented workers.
Mia is taking action.
A. preventative 330. When a country’s output exceeds its pop-
ulation growth, it will have
B. corrective
C. defect repair A. Inflation
D. productive B. Economic growth
C. A recession
326. The term span of management is also
known as D. None of these
A. Span of Business 331. What are non-governmental organiza-
B. Span of Control tions (NGOs)?
C. Span of Activity A. They are only concerned with a single
issue or cause
D. Span of Planing
B. NGOs support a cause that is deemed
327. What happens if managers do not coor- to be socially desirable
dinate individual employees’ work and ef- C. They are not organized or run by any
fort? government but operate for profit
A. The company is not able to handle D. NGOs usually have political aims
changes.
B. Employees are more focused on their 332. Which of the following IS NOT an exam-
tasks. ple of a point of sale system?
C. Employees duplicate tasks and are not A. A cash register
efficient. B. a debit/credit card reader
D. The company has a culture of team- C. a barcode scanner
work.
D. they are all examples of a point of sale
328. Promotion means- system
A. any form of communications that is
333. Which of the following is part of Sales
used to persuade people to buy a com-
Promotion-
pany’s product.
A. Incentives
B. to move from one place to another
B. trade shows
C. to promote
C. events
D. when students advance from one level
to the next D. catalogs
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 514
334. A company’s mission statement B. standards
A. is the basis for all directing C. schedules
B. is the basis for all financing D. goals
C. is the basis for all planning
340. A system that integrates data from var-
D. is a statement used to talk to cus-
ious departments to make it available
tomers
to help managers with day-to-day opera-
tions.
NARAYAN CHANGDER
335. A business creates an organizational de-
sign in which no employee has to report to A. management information system
more than one manager at a time. This is
following an organizational principle called B. executive information system
A. unity of command C. LAN
B. the scalar principle D. WAN
C. span of control
341. College presidents, school superinten-
D. line authority
dents, and school principals are all clas-
336. Which of the following is not a manage- sified as which business management ca-
ment strategy to respond to KPI’s. reer?
A. Investment in technology A. Administrative service manager
B. Cost cutting B. Education administrator
C. Materials management C. Human resources manager
D. Initiating lean production D. Public relations manager
337. Customers tend to look at a business as
a whole despite the number of they 342. SWOT stands for?
experience. A. Strength, Weaknesses, Opportunity,
A. complaints Threat
B. feedback surveys B. Strategies, Weaknesses, Objectives,
Threat
C. touch points
D. purchases C. Strength, Weaknesses, Openings,
Threat
338. All of the following are types of informa-
D. Strategies, Weaknesses, Openings,
tion systems EXCEPT
Time Management
A. DSS
B. ISP 343. Almost all people starting small busi-
nesses have graduated from
C. EIS
A. high school
D. MIS
B. college
339. To ensure that the quality of work is ac-
ceptable, businesses develop C. doctoral program
A. organizational charts D. business school
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 515
344. Larissa tells her employees to spend one- 349. Which of the following is not a common
third of their time on sales reports, one- component found in most business plans?
third on answering emails, and one-third
PRACTICE BOOK» NOT FOR SALE
A. A description of the HR team
on generating new leads. This is an ex-
ample of which step of the organizing pro- B. A budget and a financial analysis show-
cess? ing both resources and needs
A. Evaluate results C. A description of the company’s prod-
ucts and services
B. Group tasks into structures
D. An executive summary
C. Delegate authority
D. Allocate resources 350. completes all of the management func-
tions, but spends most of the time complet-
345. what is Promotes ing specialized work in one management
function or is responsible for a specific part
A. when you go to prom
of the company’s operations
B. If available resources are used sensi-
A. executives
bly, benefits can extend well into the
B. middle manager
C. both
C. supervisor
D. none of above
D. shift manager
346. The probability that conditions like ex-
change rates, government regulation, or 351. Which of the following would NOT be ap-
political stability will affect an investment, propriate in selecting the solution to be
usually one in a foreign country implemented to solve an important prob-
lem?
A. Risk
A. take time rather than make a quick de-
B. External risk
cision
C. Economic risk
B. involve others to help with the decision
D. Investment risk
C. select the least expensive solution
347. Who should develop business plans? D. all of these would not be appropriate
A. Current business owners
352. What type of tax are businesses required
B. Employees of a business to pay on the profits they earn?
C. Former business owners A. Excise
D. Anyone wanting to start a business B. Income
348. When aggregate demand decreases, C. Sales
which of the following will mostly likely D. Property
increase:
353. Which of the following is a true state-
A. Expansion ment about brand promise:
B. Inflation A. It is explained solely through advertis-
C. Production ing.
D. Unemployment B. It decreases brand awareness.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 516
C. It is not usually stated in words. C. innovation
D. It is the same thing as brand logo. D. improvement
354. What is an important aspect of a 359. Mission statements
customer-centric business? A. are the guidelines that direct employ-
A. Limiting the employees’ decision mak- ees’ behavior
ing B. describe the reason businesses exists
B. Aligning business activities with cus- and what they want to accomplish
NARAYAN CHANGDER
tomer needs C. are written explanations of how spe-
C. Being satisfied with the status quo cific business ideas will be carried out
D. Reducing the number of touch points D. are the principles of conduct governing
with customers an individual or group
355. An entrepreneur is 360. A system of management based on in-
A. over 30 years old volving all employees in a constant process
of improving quality and productivity by
B. is a person who starts a new business improving how they work is known as
or purchases an existing business
A. Theory X
C. Is a person who Opens and Closes a
business every day B. Theory Y
D. is a college graduate C. Theory Z
D. TQM (Total Quality Management)
356. The process of deciding how best to use
a business’s resources to produce goods or 361. What is a factor that affects a business’s
provide services selection of policies to guide its opera-
A. entrepreneurs tions?
B. role A. Communication skills of employees.
C. principle B. Personal preferences of management.
D. management C. Nature of the business.
D. Space available to display policies.
357. Which of the following is NOT a typi-
cal task in the Business Information path- 362. In today’s global climate, managers must
way? be able to operate in a world of constant
A. Updating database information
B. Using data to resolve operational prob- A. deductions
lems B. staffing
C. Building databases C. change
D. Transporting goods D. sensitivity
358. Products a business keeps on hands is re- 363. Salespeople sometimes have difficulty
ferred to as meeting the needs of customers who:
A. start-up A. ask for the salesperson’s opinion.
B. inventory B. voice their opinions in a loud manner.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 517
C. feel empathy for salespeople. C. informing employees of a payroll
D. know exactly what they want. change.
PRACTICE BOOK» NOT FOR SALE
D. requesting more information about a
364. The practice of Management written by company.
A. Peter F Drucker 369. Which of the following examples best de-
picts the directing function:
B. Terry
A. A manager hires six new staff mem-
C. Louis Allan
bers.
D. Hendry Fayol
B. A CEO determines the company’s
365. Customers who seem to disagree, ques- goals.
tion, or look for error in almost everything C. A president figures out which staff
and everybody are customers. members should report to him.
A. dishonest D. A supervisor tells her team the tasks
B. domineering they need to complete.
C. insulting 370. Rita works for an accounting firm. She
D. argumentative works in the firm’s office, usually between
10 and 20 hours each week, but hours and
366. A manager studies the business’s previ- times vary week to week. Rita’s job can
ous sales statistics as well as the sales be described as which of the following?
forecast before making purchasing deci-
A. Part-time, blue collar
sions. What type of resource is the man-
ager using? B. Part-time, white-collar job
A. Material C. Full-time, blue-collar job
B. Financial D. Full-time, white-collar job
C. Human
371. Which of the following is a business po-
D. Information tential benefit of implementing continuous
quality improvement processes:
367. Fredrick Taylor developed his scientific
management principles through the use of A. Increased revenue
B. Lower productivity
A. Cash payment to workers C. Decreased demand
B. Time and Motion studies D. Higher costs
C. Innovative Machinery
372. The three types of permanent employees.
D. Management Training
A. Full time
368. It’s appropriate to write a letter of in-
B. fixed term contract
quiry when
C. casual time
A. you’re summarizing a business report.
B. thanking a potential employer for an in- D. part time
terview. E. my time
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 518
373. What authorization does Guido’s Pizza 378. A study relating to the fixing of the work-
Shop need to obtain to operate legally ing hours with rest periods to recoup the
within its city’s limits? energy while performing in job is called
A. Real-estate license A. time study
B. Health-department permit B. motion study
C. Transportation certificate C. fatigue study
D. Search warrant D. work study
NARAYAN CHANGDER
379. Professionals in the Administration and
374. A common set of activities that makes up
Support cluster handle business informa-
an important part of a manager’s job
tion and personal records on a daily basis.
A. Management principles Therefore the need for within this path-
B. work coach way is paramount.
C. Management role A. Databases
B. confidentiality
D. Management subordinate
C. inventory
375. A manufacturing company is well-suited D. information
for a divisional organizational structure
broken down by 380. An experienced manager who meets reg-
A. job function ularly with a new manager to provide
feedback and advice
B. customer type.
A. Supervisor
C. product
B. Subordinate
D. process
C. Work Coach
376. The type of financing needed for the main D. Work Advisor
resources that will last for many years is
called 381. This level of management includes depart-
ment heads and district sales managers.
A. start-up financing
A. Supervisory
B. short-term financing
B. Middle
C. long-term financing
C. Senior
D. inventory financing
D. Staffing
377. Which term describes a distinct group of 382. When it comes to brand promise, employ-
customers with similar characteristics and ees should
similar needs or wants?
A. memorize the business’s slogan
A. Consumer
B. go about their tasks as usual
B. Market Segment
C. incorporate it into all of their daily ac-
C. Target Market tivities.
D. Focus Group D. verbalize it to every customer.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 519
383. Which of the following is a benefit of us- 388. Qualitative research
ing the functional organizational structure:
A. focuses on collecting large amounts of
PRACTICE BOOK» NOT FOR SALE
A. It encourages creativity. data.
B. It’s more flexible than other struc- B. is collected through methods of obser-
tures. vations, one-to-one interview, conducting
C. It creates narrow perspectives for focus groups.
managers.
C. is non-numerical in nature.
D. It reduces the duplication of certain ac-
D. is expressed numerically.
tivities.
384. Examples of transferable skills 389. Which concept measures how well a busi-
ness uses its resources in the production
A. Effective communication skills
process?
B. Presentation skills
A. Sustainability
C. time management skills
B. Efficiency
D. All of the above
C. Production planning
385. Employees will be most successful when
they move into a management position if D. Conservation
A. they have worked for a poor supervi- 390. Businesses need to seek opportuni-
sor so they know what not to do ties to expand
B. they begin work as a supervisor before
A. Any
receiving training
C. they have the chance to try supervision B. Old
before making a final decision C. New
D. they have done all of these D. Lots of
386. A degree is common to start an entry-
391. is a strategy to ensure that employ-
level job in the field of Human Resources.
ees are selected, used and developed in
A broad base of business knowledge and
the most effective way
background in the social sciences are pre-
ferred. A. Labour Turnover
A. Bachelor’s degree B. On-the-job training
B. Master’s degree C. Shortlisting
C. Doctorate degree
D. Human Resource Planning
D. Associate’s degree
392. Katherine is determining the objectives
387. Lower premiums and the ability to control
for her company for the year.
the claims process are advantages of
A. Leading
A. reinsurance carriers.
B. traditional liability insurance policies. B. Controlling
C. standard insurance companies. C. Planning
D. captive insurance companies. D. Organizing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 520
393. Highly effective communication can have C. Liaison
an impact on what area of project suc- D. Leader
cess?
A. Staying within budget 398. Being able to foresee a businesses future;
is a quality of which management skill
B. Being on time
A. Vision
C. Meeting original goals
B. Flexibility
D. All of these
C. Adapting to Change
NARAYAN CHANGDER
394. Rita enjoys routine, so her manager gives D. Strategic-Thinking Skills
her the same tasks every week. There-
fore, Rita is satisfied with her job and 399. Which agency enforces laws concerning
wants to perform at a high level. Rita’s air and water pollution?
manager is motivating her based on A. OSHA
A. her need for stability. B. FDA
B. her need to please others. C. CDC
C. monetary reward. D. EPA
D. fear of failure. 400. Last month, Monica used her Old Navy
395. is the obligations a business has credit card to purchase $200 worth of
over and above its legal responsibilities to clothing and accessories. When Monica re-
the wellbeing of employees and customers, ceived the bill, it stated that she had to
shareholders and the community as well as make a minimum payment of $20. This is
the environment. an example of a(n) credit account.
A. Corporate Culture A. installment
B. Leading teams B. revolving
C. Corporate Social Responsibility C. budget
D. Decision Making D. service
401. Which of the following is not a manage-
396. What is the LEAST important factor in be-
ment responsibility?
coming an entrepreneur?
A. Human Resources
A. living in a major U.S. city
B. Technology Support
B. having special skills & abilities
C. Operations
C. desire to be your own boss
D. Delegating
D. developing a good business plan
402. The organization structure that is effi-
397. The Dean of the Faculty of Business Man-
cient but with many layers of management
agement, QA University, is the keynote
is the
speaker at a retirement dinner held by the
university. This is an example of which A. line organization
role? B. matrix organization
A. Figurehead C. line-and-staff organization
B. Spokesperson D. all of the responses
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 521
403. This involves analyzing of information A. The communication skills of employ-
and making decisions about what needs to ees.
be done. This includes long term and short
PRACTICE BOOK» NOT FOR SALE
B. The personal preferences of manage-
term goals.
ment.
A. Planning
C. The nature of the business.
B. Organizing
D. The space available to display policies.
C. Implementing
D. Controlling 409. Which of the following is not one of the
five functions of management?
404. which is NOT a leadership style?
A. Planning
A. Tactical
B. Strategic B. Budgeting
C. Mixed C. Staffing
D. Goofy D. Controlling
405. Factors of production include 410. Which of the following is a common cus-
A. Money only tomer relationship management practice:
B. Labor and capital goods only A. Developing new products
C. Land (natural resources), labor, and B. Training employees
capital goods only
C. Creating a marketing budget
D. Land (natural resources), labor, capi-
tal goods, and entrepreneurship D. Managing the sales staff
406. In automated accounting, an audit 411. When managers are grouping related
A. checks the accuracy of processed in- tasks into departments or teams, they are
formation A. analyzing the external business envi-
B. is generated on a yearly basis ronment.
C. is always stored using electronic me- B. allocating the company’s resources.
dia
C. determining the organizational struc-
D. corrects the data ture.
407. which of the following has a direct impact D. instructing employees about how to
on a manager’s span of control? spend their time.
A. popularity of products
412. The marketplace is the essence of which
B. number of subordinates of the following?
C. channel of distribution
A. The selling process
D. allocation of funds
B. The manufacturing process
408. Which of the following is a factor that af-
C. The exchange process
fects a business’s selection of policies to
guide its operations? D. The marketing process
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 522
413. What are the main approaches of B. write the plan
Porter’s Generic strategies that are rele- C. gather and review information
vant for our exam?
D. ask an expert to review the plan
A. Lower Cost and Cost Leadership
B. Lower Cost and Product Differentia- 419. Dismissing (Firing) an employee for poor
tion attendance rate
C. Focus and Cost Leadership A. Planning
NARAYAN CHANGDER
D. Systems Thinking and Persona Mas- B. Organizing
tery C. Leading
414. How many core TQM concepts are D. Controlling
there? 420. A business that takes natural resources
A. 3 and converts them into a consumer good.
B. 4 A. Extrator
C. 5 B. Manufacturer
D. 6 C. Marketer
D. Wholesaler
415. An estimate of cash flowing in and out of
a business. 421. Which of the following describes the ma-
A. cash budget trix organizational structure:
B. operating budget A. It includes only traditional depart-
ments, such as sales and marketing.
C. working capital
B. It is separated by product lines.
D. financial records
C. It is a combination of two other orga-
416. Small businesses employ of private nizational structures.
sector employees in the United States.
D. It is the oldest organizational struc-
A. less than 10 percent ture being used.
B. about a quarter
422. A statement describing the purpose of
C. more than half your business
D. about 75 percent A. Business plan
417. Anticipating problems and coping with B. mission statement
change is one of the positives of C. insurance card
A. directing D. vision statement
B. staffing 423. According to , all people have five ba-
C. planning sic type of needs.
D. organizing A. Abraham H. Maslow
418. The first step in developing a business B. Fredrick W, Taylor
plan is to C. Abraham Lincoln
A. identify strategic alternatives D. Fredrick Douglass
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 523
424. The most important factor in carrying out 429. A manager evaluates the production out-
brand promise is: put of a department by checking it against
the production goals for that time period.
PRACTICE BOOK» NOT FOR SALE
A. brand personality.
This is an example of the function of
B. business environment. management
C. corporate culture. A. planning
D. employees. B. directing
425. A type of business that moves goods C. organizing
from the manufacturer to the consumer. D. controlling
A. Marketer 430. Why is leadership important in the
B. Extractor change management process?
C. Manufacturer A. To act as a bridge as employees tran-
D. Wholesaler sition to new practices
B. It isn’t, employees just need to do
426. Takes place during the production process what they’re told
when the value of output to consumers is
C. Employees will not know what to do if
greater than the costs of production to the
nobody tells them
firm.
D. To implement a change management
A. Economic sustainability
theory
B. Value added
431. In which stage of project management is
C. Social sustainability
the product delivered?
D. Operations Management A. Initiation
427. The basic accounting equation is B. Planning
A. capital = assets + liabilities C. Monitoring and controlling
B. liabilities = assets + capital D. Closing
C. assets = capital-liabiities 432. Which of these is a skill important for
D. assets = liabilities + capital managers?
A. Communications
428. The following are which type of prob-
lems when starting a business:1. Accounts B. Flirting
were not kept properly-cash flow, in par- C. Jokes
ticular, was a problem 2. Raising start-
D. Stubborness
up capital was too difficult 3. Raising
medium-term to long-term finance was dif- 433. What is a cost associated with customer
ficult complaints?
A. Business Plan A. Markups on inventory
B. Market Research B. Additional advertising
C. The Market C. Higher commissions
D. Finance D. Loss of sales
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 524
434. Anything that interferes with the 439. , the economic system of the United
sender’s creation and deliver of a message States, allows people to do business with
and the receiver’s receipt and interpreta- a minimum of government interference
tion of a message is
A. Sole proprietorship
A. A distraction
B. Incorporation
B. A distortion
C. Capitalism
C. A barrier
NARAYAN CHANGDER
D. Feedback D. Free enterprise
435. Managers are affected by change in a 440. Which of the following describes the func-
business. Which of the following are ways tional organizational structure:
that they may be affected.Select all op-
tions relevant. A. It includes traditional departments,
such as sales and marketing.
A. Responsible for implementing the
change B. It is separated by divisions, such as
product or process.
B. Develop new skills
C. Adjust management style C. It is a combination of two other orga-
nizational structures.
D. Product loyalty
D. It is the newest organizational struc-
436. A computer that stores data and applica- ture being used.
tion software for all workstations in a sin-
gle building or building complex is called 441. Which management function is described
a in the following situation:Marshall deter-
A. bus mines the type of workers he needs, lo-
cates qualified applicants, selects those to
B. server
be hired, andassigns the new hires to a
C. search engine work area
D. browser A. Directing
437. Discrimination in hiring based on race, B. Controlling
ethnicity, religion, gender, or national ori-
gin is prohibited by the C. Staffing
A. Equal Pay Act D. Planning
B. Civil Rights Act
442. The management function that involves
C. Immigration Reform and Control Act identifying and arranging the work and re-
D. Fair Labor Standards Act sources needed to achieve the goals that
have been set is
438. Management is what a Manager does
A. planning
A. Peter F Drucker
B. Terry B. organizing
C. Louis Allan C. implementing
D. Henry Feyol D. controlling
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 525
443. Which of the following is a potential job C. Sole trader
position within banking services: D. Partnership
PRACTICE BOOK» NOT FOR SALE
A. Credit analyst
449. Process of setting goals and deciding how
B. Insurance broker to accomplish them
C. Real estate developer A. Organizing
D. Public relations specialist B. Planning
444. Which of the following is NOT an exam- C. Controlling
ple of an operational plan? D. Leading
A. setting monthly production levels
450. Which of the following is an advantage
B. developing a department budget
of using the divisional organizational struc-
C. watching Netflix ture:
D. planning inventory levels A. It’s unpredictable in nature.
445. Which of the following is defined as get- B. It balances conflicting organizational
ting goods or services from an outside sup- objectives.
plier? C. It can create better customer experi-
A. outsourcing ences.
B. off shoring D. It can encourage competition.
C. employee involvement 451. Which is part of Personal Selling-
D. strategic planning A. Direct Response
446. The desired culture a business wishes to B. Broadcast
establish is called? C. Sales Presentation
A. Real coporate culture D. Press Release
B. Official corporate culture
452. How has social media affected marketing
C. Ideal coporate culture techniques?
D. Observable corporate culture A. selling them
447. The staffing function is determine from B. Spread of information faster
the organizing function because staffing is C. Everyday by people, in places, with
A. optional communication
B. the foundation of organizing D. Goods
C. more important than organizing 453. Moore’s Law forecasts that the amount
D. continuous of data that could be processed by a com-
puter chip would
448. An individual that owns a business, is en-
titled to all profit after tax and is liable for A. double about every 18 months.
losses is? B. triple about every few months.
A. Private individual C. double about every two years.
B. Proprietor D. triple about every three years.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 526
454. Top-level managers are also known as B. market demand
A. supervisors C. skills of the labor
B. specialists D. availability of resources
C. executives 460. One action that an ethical business can
D. coordinators take to help build the long-term trust and
loyalty of its customers is to:
455. Today, working in teams
A. send daily opt-in e-mail messages to
NARAYAN CHANGDER
A. is not common customers.
B. is a disaster B. maintain detailed information about
C. common customers’ transactions.
D. declining C. sell its customer list to third parties
without permission.
456. Espirit de corps means
D. implement a comprehensive customer
A. Union is strength. privacy policy.
B. Service is our motto.
461. Why do businesses need to advertise?
C. Buyer beware.
A. To keep loyal customers
D. Product is our strength.
B. To take customers from competitors
457. In addition to being yours and written by tempting them to try a new product or
down, strong goals must have what three service
qualities? C. Both options
A. Specific, meaningful, and have a com- D. none of above
mon thread
462. Manager
B. Singular, measurable, and have a foun-
dation A. An employee whose overall job is to
make sure that the organization meets its
C. Singular, meets a need, and have a
goals and obligations.
time limit
B. An employee that runs the warehouse
D. Specific, measurable, and have a time
& operational activities.
limit
C. Direct control of the entire business/
458. According to the Video presentations, D. People who are responsible for setting
which of the following careers is part of requirements
the Business Information pathway?
A. Data warehousing specialist 463. A pricing strategy is:
B. Recruiter A. Not worth worrying about until you
generate a lot of customers
C. Development and training specialist
B. Determined by the consumer.
D. Warehouse manager
C. The pricing policies or methods used
459. Operations planning decisions are influ- by a business when deciding what to
enced by charge for its products
A. technology D. none of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 527
464. Which of the following KPI’s would the B. monopoly
strategy of “cost cutting” be appropriate
C. conglomerate
to respond to (select all that apply)
PRACTICE BOOK» NOT FOR SALE
A. Net Profit Figures D. corporation
B. Number of Sales
469. Which of the following is the term used
C. Percentage of Market Share to describe the level to which someone is
D. Rate of Productivity Growth likely to gain employment and be success-
ful in a career?
E. Level of Staff Turnover
A. Work-life balance
465. Which of the following is the main pur-
pose of management B. Flexibility
A. To obtain the needed resources C. Employability
B. To reach a specific level of productivity D. Morale
C. To accomplish the business’s goals
D. To create a pleasant working atmo- 470. Businesses use organizational design to
sphere structure their
A. people, information, and technology.
466. What is the primary function of the Ran-
dom Access Memory (RAM) component of B. technology, people, and competitors.
a computer?
C. people, information, and competitors
A. Serves as a temporary holding area for
files and programs D. information, technology, and competi-
tors.
B. Reads the computer code that provide
visual effects 471. Which of the following is a benefit of cus-
C. Stores data and programs perma- tomer relationship management:
nently
A. The opportunity to create targeted
D. Enables the user to apply point and marketing campaigns
click commands
B. A work force that does not commit er-
467. Which of the following is the term used rors
to describe a barrier preventing minori-
ties and women from rising to positions C. A decrease in customer advocacy
of power or responsibility? D. The ability to double the business’s
A. Glass ceiling profits
B. Steel curtain
472. The money a business collects from sales
C. Hard hurdle is called
D. Career ladder jobs, Careers & Educa-
A. gross balance
tion
B. profit
468. A corporation that owns a group of unre-
lated companies is called a C. revenue
A. pool D. salary
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 528
473. Define level of staff turnover? 478. This person would work in the personnel
A. The rate in which employees leave the department of a business. He/She would
business be resp0onsible for hiring new employees.
B. the rate in which employees don’t turn A. Construction
up to work B. Educational Administrator
C. The amount of spins an employee can C. Human Resources
do in one minute
D. Administrative Services
NARAYAN CHANGDER
D. the rate in which employees leave the
business and replaced 479. Which of the following is NOT one of the
two levels of analysis used to determine
474. Public listed companies can have up to what is required?
A. 20 shareholders A. Persona analysis
B. 50 shareholders B. Organisational analysis
C. 200 shareholders C. Goal analysis
D. no maximum number of shareholders D. Task analysis
475. Planning has three stages
480. Which is NOT an area of management re-
A. Strategic, tactical & operational sponsibility
B. Briefing, tactical & operational A. Sales and marketing
C. Summary, tactical & operational B. Corporate social responsibility
D. Appraisal, strategic & tactical C. Technology support
476. The practice of contracting with outside D. Human resources
specialists to perform selected human re-
source functions. 481. Roughly what percentage of new jobs
are created by businesses with fewer than
A. Off-shoring 500 employees?
B. Contracting A. 80 Percent
C. Consulting B. 60 Percent
D. Outsourcing C. 20 Percent
477. Which of the following is the best defini- D. 40 Percent
tion of a ‘business’?
482. The management function involves
A. Any organization involved in the pro-
identifying & arranging the work and re-
duction of a good or the provision of a ser-
sources needed to achieve the goals that
vice
have been set.
B. A company that strives to earn profit
A. organizing
for its owners
B. controlling
C. Any organization that undertakes the
selling of goods C. planning
D. Any organization that employs workers D. staffing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 529
483. When a manager gives guidance to em- 488. Supply chain network design improves
ployees to perform their tasks, he or she service and reduces cost by aligning pur-
is said to be performing the task of chasing, production, warehousing, inven-
PRACTICE BOOK» NOT FOR SALE
A. planning tory, and
A. the sales force
B. organizing
B. marketing
C. staffing
C. transportation
D. leading
D. promotion
484. refers to a form of business that has
a social purpose. The a ims may include 489. The most flexible organizational struc-
improving human, social, or environmental ture for a business is the
well-being. A. line organization
A. Public corporation B. matrix organization
B. Sole Proprietorship C. line-and-staff organization
C. Social Enterprises D. centralized organization
D. Partnerships E. True
485. Mark feels like his hard work is 490. A manager is most likely to use financial
never recognised. Which level of needs reports to
(Maslow) is not being satisfied? A. decider whether to continue opera-
A. Self-Esteem tions
B. Social B. detect fraudulent practices
C. Self-Actualisation C. decide on the terms of a business loan
D. make day-to-day decisions
D. Physiological
491. Which of the following is not a specific
486. To create a pleasant working atmosphere
strategy to improve quality in production
A. To serve as a link between top-level
A. Quality control
and first-line management
B. Quality focus
B. To establish long-term objectives for
the company C. Quality assurance
C. To make sure projects meet deadlines D. Total quality management
D. To prepare workers’ daily schedules 492. If there is an irreconcilable difference be-
tween the company’s checkbook and the
487. When a project’s scope slowly gets big- bank balance, the accountant should:
ger and bigger, it creates a challenge for
A. make an adjustment to Miscellaneous
project managers known as
Expense
A. project creep.
B. contact the bank
B. resource deficiency.
C. wait until next month’s statement ar-
C. communication gap. rives
D. budget overage. D. close the account
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 530
493. When considering where to locate, these 498. What the benefits of induction
are the factors that may make setting up A. reduce stress and anxiety
or relocating abroad an attractive option
for businesses B. well-prepared
A. Globalization C. build a new employee’s confidence in
the job
B. Push
C. Pull D. greater awareness of major safety
policies and procedures.
NARAYAN CHANGDER
D. Extension
499. An authoritarian managing style is used
494. Small businesses are sometimes referred
when
to as which of the following?
A. you have very experienced employees
A. All in the family businesses
B. tasks need to be done quickly
B. Father and son businesses
C. Family owned and operated C. you ask for input from an employee
D. Mom and pop businesses D. none of above
495. Strategic planning 500. Which two bank services is a new busi-
ness likely to need?
A. is short-term planning
B. determines how work will be done and A. balance
who will do it B. salary
C. short specific statement of purpose C. loan
D. provides broad goals and direction for D. checking account
the business
501. Different methods of motivating staff in-
496. Which of the following accurately de- clude
scribes initiative?
A. Providing fair play for the work that
A. Being willing and able to adapt, learn employees do
and change
B. Offering incentives for achieving tar-
B. The ability or instinct to act or take
gets
charge independently
C. Making decisions without notifying
C. The strength of mind to carry on in the
staff
face of difficulty
D. Expecting staff to complete work in
D. Feeling the need to voluntarily pursue
their own time
knowledge
497. is concerned with contractual, emo- 502. A team discussion technique used to gen-
tional, physical and practical relationships erate as many ideas as possible for solving
between employers and employees? a problem is known as
A. Workplace trust A. Idea storming
B. Workplace relationships B. Nominal groupthink
C. Workplace relations C. Creative thinking
D. Human resources D. Brainstorming
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 531
503. Daniel works at ‘Ebisu Motors’ but has B. Cooperatives
been given notice for his dismissal due C. Public-private partnerships
to his ongoing unsatisfactory work perfor-
PRACTICE BOOK» NOT FOR SALE
mance. Which of the following is not a pos- D. Microfinance
itive affect of EM dismissing Daniel? 508. Performance management strategies in-
A. Change in structure clude?
B. Culling non-productive employees A. Chocolate
C. Reduction in costs B. Job Rotation
D. Loss of talent C. Employee Observation
D. A participative management style
504. What is the appropriate distance for so-
cial space? 509. People buy from those they
A. 4-12 inches A. Follow on social media
B. 4-12 feet B. Have a personal connection with
C. 2-4 inches C. think are beautiful
D. 2-4 feet D. Know, follow, and have great content
505. Which employee in the Business, Man- 510. Which is an example of publicity?
agement, and Administration career clus- A. A news release
ter would most likely work in a cubicle? B. Direct mail
A. Receptionist C. Billboard
B. Mail Clerk D. TV commercial
C. Sales Representative
511. Successful leaders
D. Accountant A. continue to study and learn to improve
506. Name that concept:Every organization their management skills
operates in a range of environments in B. work to solve conflicts and problems
which its role may be interpreted differ- C. understand that they must help em-
ently. These expectations affect planning, ployees satisfy their own needs while ac-
decision-making and strategy implementa- complishing the goals of the company,
tion. Within an organization, values and
backgrounds influence what stakeholders D. all of the responses
focus on and how they work. 512. A manager studies the business’s previ-
A. Strategy ous sales statistics (data) as well as the
sales forecast before making purchasing
B. Culture
decisions. What type of resource is the
C. Innovation manager using? (What is another word
D. Ethics for data? )
A. Material
507. Which of the following help individuals
in low-income economies to establish their B. Financial
own businesses? C. Human
A. Stock exchanges D. Information
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 532
513. The practice of performing peripheral ac- C. Slow/Methodical
tivities internally, within the company (the D. Dishonest
opposite of outsourcing)
518. We will cut employee injuries by 50%
A. In-housing
with our new safety protocol training
B. Reshoring A. Planning
C. Offshoring B. Organizing
D. Subcontracting C. Leading
NARAYAN CHANGDER
514. Manager Aniya helps an employee work D. Controlling
the computer, count the money in a cash 519. Maslow’s Self-Actualisation Needs are
drawer and prepare a bankdeposit is similar to which of the Four Drives?
demonstrating
A. Drive to Acquire
A. natural talent
B. Drive to Bond
B. technical skills C. Drive to Learn
C. creativity D. Drive to Defend
D. aggressive behavior
520. Many people make the mistake of think-
515. Analyzing information and making deci- ing that customer relationship manage-
sions about what needs to be done: ment refers solely to
A. planning A. technology.
B. strategies.
B. organizing
C. processes.
C. leading
D. people.
D. staffing
521. The purpose of planning for the future is
516. Which of the following is a benefit of to ensure which of the following?
brand promise:
A. You obtain the biggest salary possible
A. It increases the company’s market B. You make choices today which will ben-
share. efit you in the long term?
B. It attracts employees to the company. C. You get a job immediately after gradu-
C. It allows the company to pay higher ating high school
salaries. D. You do not have to scarifice anything
D. It allows the company to stand out to have the job you want
from the competition. 522. Marketing Mix:Product (preparation for
517. What kind of customer would make the next week) We will learn about the Prod-
following statement:“I just don’t know uct Life Cycle (PLC)-How many stages are
which of these my girlfriend would like in the PLC?
best. I had better come back at another A. 3
time.”? B. 5
A. Disagreeable C. 7
B. Suspicious D. 12
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 533
523. During-the-sale touch points should be 528. The cost of designing a reliable, durable
designed to product is a(n) cost.
PRACTICE BOOK» NOT FOR SALE
A. get the customer’s attention. A. external failure
B. resolve any problems the customer B. appraisal
has with the product. C. internal failure
C. show the customer what benefits the D. prevention
brand offers.
529. Starting small in your business means
D. reinforce that the customer is making
you may NOT be able to:
the right buying decision.
A. Build a loyal customer base
524. One of the characteristics of a formal
B. Establish your business name
structure is
C. Hire more people right away
A. decentralization
D. Develop a good reputation
B. departmentalization
C. project partnerships 530. Which of the following is an important
function of mid-level management:
D. self-directed teams
A. To prepare workers’ daily schedules
525. What is another name for Hertzberg two
B. To serve as a link between top-level
theory motivation theory
and first-line management
A. Happy & sad theory
C. To make sure projects meet deadlines
B. Motivator & hygiene
D. To establish long-term objectives for
C. Motivator & clean the company
D. none of above
531. Methods of determining wages and con-
526. What do teaching and nursing have in ditions?
common? A. Awards, collective bargaining, unfair
A. They are in the same Career Cluster dismissal claim
B. You can receive certification for both B. Awards, enterprise agreement, indi-
jobs at technical schools vidual contract
C. They are sometimes stereotyped as C. Enterprise agreement, awards, perfor-
women’s jobs mance management
D. they both require doctoral degress D. None of the above
527. Rita is the regional manager for a cloth- 532. Career advancement is a motivational
ing retailer. She attends a ribbon cutting strategy that can apply to which 2 theo-
ceremony every time a new store opens ries?
for business. Which one of Mintzberg’s A. Maslow and Locke & Latham
managerial roles is she fulfilling? B. Maslow and Lawrence & Nohria
A. Figurehead C. Lawrence & Nohria and Locke &
B. Liaison Latham
C. Leader D. Lawrence & Nohria and Lewin
D. Communicator E. None of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 534
533. The quantity of goods that a firm has on 538. A study relating to the fixing of the work-
hand. A complete list of items such as ing hours with rest periods to recoup the
property, goods in stock, or the contents energy while performingin a job is called
of a building is the definition of
A. Management A. Fatigue study.
B. Merger B. Time study.
C. Inventory C. Motion study.
NARAYAN CHANGDER
D. Entrepreneur D. Work-study.
534. Authority in an organization is delegated 539. The idea that most people seek to meet
the lower-level needs before they address
A. from top to bottom higher-level needs is most closely associ-
B. from one department to another ated with
C. started from the bottom now we’re A. Herzberg
here B. McClelland
D. started from the bottom now the C. Maslow
whole team is here
D. Fiedler
535. Which of the following is not a TQM es-
540. Which principle of organizational design
sential component?
states that authority should flow in a clear,
A. Ivolving employees unbroken line from the top of an organiza-
B. Focusing on the customer tion to the bottom?
C. Quality management A. Span of control
D. Management decisions B. Staff authority
C. Responsibility
536. Which of the following are examples of
digital marketing? Select those that ap- D. Scalar principle
ply. 541. Define ‘working capital’
A. Websites A. How easily an organisation can pay its
B. Billboards short term debts
C. Social media B. Payment to shareholders for having
shares in a company
D. Free delivery when you buy online
C. Selling shares on the stock market
537. Management theory that studies the
D. none of above
way work is organized and the procedures
used to complete a job in order to increase 542. Which of the following is one way busi-
worker productivity ness can be categorized?
A. Administrative Management A. By product
B. Behavioral Management B. By demographic
C. Classical Management C. By width
D. Quality Management D. By salary
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 535
543. A democratic leader 548. An innovation so important that it may
change the industry itself
A. makes all of the decisions
PRACTICE BOOK» NOT FOR SALE
A. Research and development
B. lets each employee decide how work
will be done B. Positioning innovation
C. encourages shared decision-making, C. Paradigm innovation
D. Product innovation
D. does not make decisions
549. Question 11 (1 point)What occurs in the
544. When the hybrid vehicle was introduced, planning function of management?
it was an example of a project that
A. Deciding what needs to be done and
A. created new technology. how it will be accomplished
B. enhanced an existing project. B. Coordinating all those involved to
C. created a new product using existing achieve the company of departmental
technology. goals
C. Comparing what was planned with the
D. used entirely new technology.
actual performance
545. Management is the art and science of de- D. Delegating duties to other employees
cision making and leadership in the company
A. Harold Koontz. 550. Which of the following is not a KPI from
B. Donald J. Clough. our study design
C. Louis Allan. A. Staff Turnover
D. Terry. B. Percentage of Market Share
C. Benchmarking
546. Tony works for a large insurance com- D. Net Profit
pany. His job is to support the company
president, schedule his/her appointments, 551. Which of the following is not an aim of
and answer his/her phone calls. Tony quality management?
works in
A. Minimise waste and defect rates
A. human resource management. B. Achieve set quality standards
B. administrative services. C. Obtain consistently high standards of
C. marketing communications. product
D. operations management. D. Find strategies to optimise operations
by cutting corners
547. What are the two main keys in job anal-
552. Price for products that are popular often
ysis?
will
A. job design A. remain constant
B. job description B. be priced higher
C. job specification C. supply less
D. job analysis D. be worth less
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 536
553. What management function is being de- 557. What is human relations?
scribed in the following situation:David A. Is the way people get along with each
Thomas, a top-level manager, identifies other
jobs to be performed, assigns responsibil-
ity for them, establishes departments to B. Is the way people don’t get along to-
handle the jobs, and determines how many gether
and which employees mid-level managers C. The way human relationships work
will supervise. D. The way people argue
NARAYAN CHANGDER
A. Directing
558. At work, Amanda makes sure she re-
B. Controlling solves conflict quickly and listens to all
C. Planning sides. What is she accomplishing?
D. Organizing A. Conflict management as a team mem-
ber
554. Which of the following is a true state- B. Conflict management as a leader
ment regarding project managers:
C. Ethical decision making
A. Anyone with the right skills can be a
project manager. D. Goal setting
B. Project managers are usually top-level 559. What type of business structure consists
executives. entirely of work group and teams which
C. Math and computing are the most im- perform an organization’s work?
portant skills for project managers. A. Team-based structure
D. Project managers are only distantly in- B. organizational structure
volved in the project. C. group structure
555. The manner and approach of providing di- D. none of above
rection, plans and motivation is called?
560. A structure is composed of self-
A. Management Direction contained units or divisions.
B. Management Style A. Simple
C. Decision Making B. Divisional
D. Management Decision C. Matirx
D. Learning
556. Rich works the cash register at a retail
store. The store is unusually busy today, 561. Brynn manages employees who are new
and Rich’sline has grown long. A woman on the job and need quite a bit of supervi-
at the back of the line remarks loudly, sion. Therefore, she can only supervise a
“This is absolutelyridiculous!” Rich’s cus- few employees at once. Brynn’s span of
tomer is control is
A. domineering/superior. A. open
B. impatient. B. wide
C. argumentative. C. narrow
D. leave-me-alone. D. tight
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 537
562. On an organizational chart a direct line of C. risk inhibitors.
authority is indicated by a line. D. execution standards.
PRACTICE BOOK» NOT FOR SALE
A. diagonal
568. The activities of selecting and describ-
B. dotted
ing one or more target markets and de-
C. solid veloping and maintaining a marketing mix
D. straight that will produce mutually satisfying ex-
changes with target markets
563. Piece Rate System is contributed by A. advertising
A. Taylor B. marketing strategy
B. Louis Allan C. human resources
C. Harold Koontz
D. pricing strategy
D. Hendry Fayol
569. When a business is (i.e. buying in
564. The consistency or repeatability of mea- large quantities of raw materials and turn-
surement. ing them into smaller end products such as
A. Efficiency wood to paper and/or pencils, it makes
more sense to locate near the source of the
B. Validity raw materials.
C. Effectiveness A. Cannabalistic marketing
D. Reliability
B. Lean production
565. How many employees are in a small busi- C. Bulk decreasing
ness?
D. Deregulating
A. usually less than 100 employees
570. Informal structure often works well for
B. usually more than 100 employees
C. usually less than 50 employees
A. international businesses
D. none of above
B. large corporations
566. A manager’s team consistently hits sales C. service businesses
targets and exceeds profit goals. The man-
ager knows that s/he is a good director by D. small businesses
examining 571. How are KPIs used to evaluate the effec-
A. time standards. tiveness of a business transformation?
B. quality standards. A. To judge where changes need to be
C. employee turnover. made
D. quantity standards. B. To figure out if employees are happy
with the changes
567. Rules and regulations for keeping a C. To measure whether the change has
project on track are known as achieved the objective
A. governance mechanisms. D. To see if there has been any transfor-
B. project laws. mation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 538
572. Objectives that relate to the role of a B. Its primary use is for completing com-
business in the community are called? plex activities.
A. Social objectives C. It requires a signed contract from
B. Corporate social responsibility stakeholders.
C. Employee objectives D. It involves the coordination of multiple
activities.
D. Shareholder objectives
578. Which of the following is not a motiva-
NARAYAN CHANGDER
573. A human resources manager would most tion strategy?
likely prefer an employee turnover rate of
A. Performance-related pay
A. less than 10%
B. Career advancement
B. Around 25%
C. Investment on training
C. 100%
D. Support and Sanction
D. none of above
E. Business relationships
574. Maria is meeting with two of her employ-
579. A system established to ensure that
ees who have had a disagreement to help
the predetermined quality standards are
them come to an agreeable solution.
achieved is..?
A. Leading
A. Productivity
B. Controlling
B. Quality assurance
C. Planning
C. Product recall
D. Organizing
D. Quality certification
575. What is the expectancy theory?
580. How should effective management plan-
A. The ability to punish. ning be?
B. The ability to influence people. A. Realistic and flexible
C. Assuming there is one way to lead. B. strict and controlling
D. The belief that if you work hard, you C. static and inflexible
will be rewarded.
D. none of above
576. This will keep electronic copies of all your
581. A written statement of goals and objec-
important paperwork
tives for a business with a strategy to
A. accounting system achieve them is called
B. point of sale system A. mission statment
C. document management system B. business plan
D. human resources C. financial plan
577. Which of the following statements is true D. Market analysis
about project management? 582. Which of the following documents is
A. It is a continuous series of events with drafted in the initiation stage of project
an unlimited life span. management:
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 539
A. Lessons-learned document 588. This type of communication is appropriate
B. Risk analysis for communicating information pertaining
to new policies and orders.
PRACTICE BOOK» NOT FOR SALE
C. Work breakdown structure
D. Statement of work A. Verbal
B. Written
583. determines how plans can most ef-
fectively be accomplished; arranging re- C. Oral
sources to complete the work.
D. Both Oral and Written
A. Observing
B. Organizing 589. The process whereby younger employees
C. Planning help members of an older generation un-
derstand differences is called
D. Staffing
A. Mentoring
584. Small businesses are responsible for
what percentage of sales in the U.S.? B. Reverse mentoring
A. 45% C. Reverse training
B. 54%
D. None of these
C. 47%
D. 57% 590. Which production concept promotes inter-
generational equity?
585. Before you decide what you’re going to
sell, you need to answer this simple ques- A. Quality assurance
tion: B. Continuous improvements
A. How can I make some money?
C. Sustainability
B. How can I hire the best people?
D. Production planning
C. What problem can I solve?
D. Where can I open my store? 591. Managing work schedules to achieve
586. Effective budgets should always be maximum productivity.
A. evaluated A. Subordinate
B. optimistic B. Problem
C. inflexible C. Time management
D. secretive
D. Work coach
587. Encourages trade between nations
A. Because resources are valuable to 592. producing output at the highest ratio of
marketers, it doesn’t take them long to output to input
B. If our nation lacks a resource, we can A. effectiveness
usually trade something to get it
B. efficiency
C. pinpoint where a particular resource
can be found in abundance C. labor intensive
D. all of above D. capital intensive
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 540
593. Which career requires less education than C. entrepreneurs
an Auditor? D. executives
A. Accountant
599. Pricing is?
B. Bookkeeper
A. Pricing decisions dictate how much to
C. Credit Analyst charge for goods and service in order to
D. Financial Manager make a profit
B. Pricing decisions are based on costs
NARAYAN CHANGDER
594. This is the process where one company
acquires legal control over another and on what competitors charge for the
same product or service
A. monopolization
C. Must also determine how much cus-
B. merger tomers are willing to pay
C. invest D. All of above
D. absorption
600. Which of the following is NOT one of the
595. Which law required automobile makers four components of the business process?
to modify engines to meet higher emission A. Production
standards?
B. Organization
A. Automobile Emission Act
C. Finance
B. Clean Air Act
D. Marketing
C. Modified Engine Act
D. Air and Water Pollution Act 601. is determining what needs to be done,
how it will be done and who is to do it.
596. It is a portion of profits earned by the A. Planning
shareholder.
B. Organizing
A. Stocks
C. Leading
B. Revenue
D. Controlling
C. Shares
D. Dividends 602. Mitch’s boss placed him in charge of ship-
ping at his company. Whenever anyone
597. How should a person prepare for an in- wants to ship a package, they need his ap-
terview? proval and oversight. Mitch has
A. Research the company A. organizing skills.
B. Get a poor night’s sleep B. authority.
C. Don’t ask questions C. divisional control.
D. none of above D. specialization.
598. Employees at the first level of manage- 603. The management function responsible for
ment in business are arranging resources to complete work is
A. mid-managers A. planning
B. supervisors B. implementing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 541
C. organizing 609. An award is
D. controlling A. A form of incentive for employees
PRACTICE BOOK» NOT FOR SALE
E. staffing
B. Performance related pay
604. Posture and gestures are included in
which type of communication? C. Minimum wages and conditions for
employees
A. body language
B. verbal communication D. Minimum wages and conditions for em-
ployees in an industry
C. online communication
D. none of above
610. Which of the following is NOT one of the
605. refers to the practice of using an- common responsibilities of supervisors?
other business (as a third party) to com-
plete part of the work. A. communicating goals and directions
A. offshoring B. motivating employees to work effec-
B. transporting tively
C. outsourcing C. keeping management informed of em-
D. relocating ployee ideas and concerns
606. A leader must contain which of these D. developing long range plans for the or-
characteristics? ganization
A. Charisma
611. Basic skills include all except
B. Charm
C. Berzerkness A. basic math functions
D. Confidence B. reading and writing
607. This is also known as flow production C. writing computer code
since the business uses a continuous flow
of materials along an assembly line. D. effective speaking and listening
A. Job production
B. Match production 612. Which management function is described
in the following situation:James Crane has
C. Batch production
created a team atmosphere among the
D. Mass production members of his sales department. When
the team exceeded their monthly sales
608. The protects businesses from unfair
goal, James rewarded them with a celebra-
methods of competition.
tory dinner out and a five-percent bonus.
A. Federal Trade Commission (FTC)
B. Federal Competition Commission A. Directing
(FCC) B. Controlling
C. Federal Transportation Commission
(FTC) C. Planning
D. Federal Monopoly Commission (FMC) D. Organizing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 542
613. The effectiveness of a supervisor’s job is 618. Which of the following is a common way
determined by which factor? for customers to express their complaints:
A. the quality of the work of the super- A. Directly to the CEO
vised employees B. Patiently
B. the efficient use of the company’s re- C. Verbally
sources
D. Silently
C. the satisfaction of the supervisor’s em-
NARAYAN CHANGDER
ployees 619. What are the resources used in produc-
D. all of these tion process collectively known as?
A. Capital resources
614. This level of management is usually not
involved in a company’s day-to-day prob- B. Factors of production
lems, but generally sets the direction the C. Raw materials
company will follow. D. Working Capital
A. supervisory management
620. Which of the following career clusters fo-
B. middle management cuses on tending to families and human
C. senior management needs?
D. staffing management A. Finance
615. A written statement that defines a busi- B. Health Science
ness’s core purpose and focus is called? C. Human Services
A. Mission statement D. Education and Training
B. Vision statement 621. What is self understanding?
C. Values statement A. To be able to meet the expectations of
D. Managers statement others
616. Maslow’s Social Needs are similar to B. To not be able to meet expectations
which of the Four Drives? C. To understand yourself
A. Drive to Acquire D. To not understand yourself
B. Drive to Bond 622. This form of communication includes in-
C. Drive to Learn terviews, meetings, lectures and presen-
D. Drive to Defend tations.
A. Visual
617. Which of the following management
styles keeps the operation running B. Written
smoothly rather than accomplishing other C. Verbal
goals? D. Informal visual
A. Power-oriented
623. What will probably happen to a business
B. Routine-oriented if it continuously fails to deliver on its
C. Achievement-oriented brand promise?
D. Micromanagement A. Lose credibility
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 543
B. Improve sales volume 629. Which of these is not a management skill
C. Increase market share A. Budgeting
PRACTICE BOOK» NOT FOR SALE
D. Decrease liability B. Communication
C. Delegation
624. Strategic Planning
D. Decision Making
A. is short-term planning
B. provides broad goals and direction for 630. Which of the following are characteristics
the entire business of a manufacturing business? (select all
that apply)
C. short/specific statement of the busi-
ness A. Create tangible products
B. Can be stored
D. All the above
C. Lots of customer input
625. A set of behaviors associated with a par-
D. Production and consumption generally
ticular job
occur at the same time
A. principle E. Little customer involvement
B. glass ceiling
631. Which staffing task involves selecting
C. role which job applicants to interview?
D. managaement A. Determining need
626. Coordination of activities and resources B. Recruiting
needed to accomplish a plan C. Onboarding
A. Controlling D. Screening
B. Organizing 632. First Line Management (supervisory)
C. Controlling A. Responsible for day to day activities
D. Leading B. CEO, President, Vice President
627. A group that is in charge of making busi- C. Directly under top level
ness decisions for a corporation. D. Carries out orders from top
A. Staff 633. what is the most important aspect of a
B. Board of Directors business manager
C. Management A. leadership
D. Proprietors B. creativity
C. originality
628. under what circumstances would a com-
pany adopt a matrix organizational struc- D. careness
ture? 634. The benefit that a brand promises to its
A. it has offices in several cities target customers must be
B. it frequently uses cross functional A. important to them
teams B. tangible.
C. it has fewer that 50 employees C. of monetary value.
D. it has mostly inexperienced employees D. approved by the government.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 544
635. Principles of good writing means the man- B. evaluate the decision
ager takes the time to be sure the and C. training needs
are appropriate for the audience.
D. identify the problem
A. Meetings
B. Interviews 641. Which of the following is the fastest
C. Hallways growing career cluster?
D. Telephones A. Architecture and Construction
NARAYAN CHANGDER
B. Agriculture, Food and Natural Re-
636. Which of these is NOT a skill of a man- sources
ager:
C. Information Technology
A. Interpersonal Skills
D. Science, Technology, Engineering and
B. Understanding
Mathematics
C. Flexibility
D. Vision 642. Nathan is a project manager in charge of
four other employees. He has divided up
637. Which of the following is a characteristic responsibilities and assigned them to spe-
of a product trade-name franchise: cific team members to work on. This is
A. It is owned by shareholders. known as
B. It is not open to the public. A. delegation
C. The franchisee has unlimited liability. B. innovation
D. The franchisee can choose the name of C. unity of command
the business. D. the scalar principle.
638. In planning the physical arrangement of 643. As a result of Henry Ford’s innovations,
an airplane facility, a manager should con- which of the following became standard in
sider this type of facility layout American factories?
A. Product Layout
A. quality control teams
B. Process Layout
B. a 35-hour workweek
C. Purchase Layout
C. strong labor unions
D. Fixed-position layout
D. an 8-hour work day
639. The broad operating conditions in which
a business operates and no control is? 644. Skill variety, task identity, task sig-
nificance, autonomy, and feedback are
A. Operating environment
five characteristics of:(also essay question
B. Macro environment where you will have to give explanation of
C. Internal environment each)
D. External environment A. Job Design
B. Dispatching
640. The final step in the decision make pro-
cess is to C. Job Description
A. analyze the solutions D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 545
645. Prevents women and minorities from company may receive direct personal ben-
moving up in the world of business efit from his or her actions at the expense
of or to the detriment of the company.
PRACTICE BOOK» NOT FOR SALE
A. entrepreneurs
A. Conflict of Interest
B. role
B. Change Agent Role
C. principle
C. Employment Exchange
D. glass ceiling
D. Internal Integration
646. Meeting with assistant managers to re-
view employee productivity 651. What is job analysis?
A. Planning A. A systematic process of gathering in-
formation relating to a job being per-
B. Organizing formed
C. Leading B. Human resource manager
D. Controlling C. as a business owners
647. The first step in handling customer com- D. none of above
plaints is to: 652. One particular area of increased demand
A. ask the customer to be brief. is-
B. call the manager for assistance. A. Business Information Technology
C. let the customer explain the problem. B. General Management
D. make a record of all the facts. C. Human Resources Management
D. Operations Management
648. It is important for a business to continu-
ally ? 653. Father of Scientific Management
A. Revisit the budget A. F W Taylor
B. Revisit objectives and look at ways to B. Henry Fayol
improve financial and other objectives C. Mary Parker
C. Communicate with stakeholders about D. Terry
finances and spending
654. Which type of business produces pro-
D. Revisit the values statement
cessed goods by changing raw goods into
649. Small businesses are responsible for a more finished form?
of the U.S. gross domestic product each A. Intermediaries
year. B. Service firms
A. less than 10 percent C. Processors
B. about a quarter D. Producers
C. more than half
655. what does Flexible working conditions is
D. about 75 percent helpful?
650. A situation where a person who has a re- A. the lengthening of shifts to 10 hours
sponsibility to act in the best interests of a B. reduced stress
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 546
C. work-from-home arrangements. D. Have direct or vested interest in the ac-
D. ordinary hours to weekend work and tivities of the organisation
public holidays
661. An Accounting acrostic to help understand
656. The duty of a business to contribute to credit and debit accounts.
the well being of society is called A. DC DEALER
A. Business ethics B. DE ADLER
B. Social responsibility
NARAYAN CHANGDER
C. DC DEALR
C. Constituency analysis D. NONE OF THE ABOVE
D. Business responsibility
662. A trait is
657. Persons who are not employed but who
are available for work. A. Common for every person
A. Unemployed B. ability to influence
B. Temporary Workers C. a distinguishing characteristic or qual-
ity that makes each person unique
C. Workforce
D. a social skill
D. Labor Pool
663. Concept in economics that a country
658. A profitability ratio
should specialize in producing and export-
A. Measures how able the organisation is ing only those goods and services which
to pay its short-term debts it can produce more efficiently than other
B. Measures how well the capital in- goods and services.
vested into the company is being utilised A. Competitive advantage
C. Measures how profitable the organisa- B. Comparative advantage
tion is
C. Absolute advantage
D. none of above
D. Opportunity cost
659. The role of HR managers when they su-
pervise or guide an organizational devel- 664. The 3 stages of Lewin’s Change model
opment intervention. are ?
A. Change Agent Role A. Unfreeze, change, freeze
B. Advisory Role B. Unfreeze, change, refreeze
C. Control Role C. Freeze, move, refreeze
D. Counseling Role D. It is not Lewin’s Theory
660. Stakeholders are individuals that ? 665. Every project creates a(n)
A. Own shares of a business or organisa-
A. deliverable
tion
B. new product
B. Are within the internal environment
C. company
C. Have no direct interest in the organisa-
tion activities D. advertising plan
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 547
666. When is it legal for a business to refuse 671. Businesses develop policies to help em-
a refund? ployees deal with customers the same
way in similar situations so that employ-
PRACTICE BOOK» NOT FOR SALE
A. When the item is faulty
ees will:
B. When the item does not match the
sample A. give personal favors.
C. When the customer has changed their B. treat customers differently.
mind C. treat customers fairly.
D. When the customer has been hurt by
D. offer special privileges.
the item
667. If there was a decrease in “number of 672. Which level of management coordinates
workplace accidents” as a KPI, is this a and supervises the activities and duties
good result or a bad result? ofemployees?
A. Good Result A. senior management
B. Bad Result B. authority management
C. Neutral C. middle management
D. none of above D. supervisory management
668. In terms of operations, organizations are 673. Activities, functions and pressures that
commonly classified as occur within a business over which it has
A. private or non-private control is called?
B. large or small A. Macro environment
C. for-profit or not-for-profit B. Internal environment
D. governmental or nongovernmental C. External environment
669. Which business strategy am I? Maintains D. Operating environment
a stable business while innovating on the
periphery by attempting to balance effi- 674. Which of the following is an example of
cient production of current products with a recycling program which does not decon-
creative development of new. struct old products to make new ones?
A. Analyzer A. Tire recycling program
B. Differentiation B. Computer recycling program
C. Focus C. Plastic recycling program
D. Reactor D. Glass recycling program
670. Skills used to help an individual find a job,
675. Why do all businesses need financial re-
perform in the workplace, and gain success
sources?
in a job or career
A. Planning A. To negotiate bank loans
B. Managerial Roles B. To develop cash budgets
C. Soft Skills C. To pay operating expenses
D. Hard Skills D. To manage investment accounts
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 548
676. The ability to make other people act in C. take
certain ways is D. collect
A. Motivation
682. Which of the following is NOT a Level in
B. Power Mallow’s Hierarchy Of Needs?
C. Negative Reinforcement A. Social Needs
D. Positive Reinforcement B. Self-esteem Needs
NARAYAN CHANGDER
677. Organizing C. Psychological Needs
A. Deciding how the company will get the D. Physiological Needs
work done to accomplish the goals. E. Physical needs
B. Keeping everyone happy
683. A process that evalutes a group of items
C. Leading & Controlling everything and ranks them in their order of impor-
D. Communicating with others tance or urgency
A. Review
678. When managers are building group dy-
namics, they are also often B. Prioritize
A. resolving conflict. C. Time management
D. Analysis
B. recruiting new staff.
C. training employees. 684. What type of plan do businesses often
implement when an original plan fails to
D. organizing the company’s structure.
produce the desired results?
679. If you start a new business, you need in- A. Production
formation about
B. Communications
A. competitors C. Contingency
B. government regulations D. Strategic
C. customers
685. Being a manager of the business variety
D. all of the above is tough because
680. What is the highest level of needs on A. You keep track of everyone
Maslow’s Theory B. You have multiple jobs
A. Included in the decisions C. Everyone relies on you
B. Social Time With Others D. Its a job
C. High Salary and Recognition
686. What is important about managing a busi-
D. Food, Sleep and more food ness
681. As an employee of a business at JA Biz- A. You are the leader
Town, you wil receive two paychecks and B. People will you judge how you do
need to them in the bank. C. People will be looking up to you for
A. deposit leadership
B. leave D. Its a job
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 549
687. Cameron supervises the transportation, 692. What kind of segmentation is used by a
storage, and handling of his company’s firm that offers a wide range of products
products. Which type of business man- such as holidays and insurance aimed at
PRACTICE BOOK» NOT FOR SALE
agement and administration career does customers aged 60 and above?
Cameron have? A. Psychographic
A. Supply chain management B. Demographic
B. Human resources management C. Lifestyle
C. Business analytics D. Geographic
D. Office management 693. What is the first level of Maslow’s Hier-
archy of Needs?
688. A federal law that provides pensions to
A. Safety needs
retired workers and disabled workers is
B. Psychological Needs
A. Fair Labor Standards Act
C. Physiological Needs
B. Occupational Safety and Health Act
D. Self-Actualisation
C. Americans with Disability Act
694. How does having a customer-service
D. Social Security Act mindset benefit a business’s employees?
689. Select ALL of the functions of manage- A. It increases the employees’ efficiency
ment levels.
B. It helps the business achieve its profit
A. planning
goals.
B. implementing C. It creates a competitive work environ-
C. organizing ment
D. controlling D. It helps employees advance in their ca-
reers.
E. judgement
695. The lower cost strategy is where a
690. The difference between current assets A. business aims to be the low cost pro-
and current liabilities is ducer in its industry
A. working capital B. business aims to sell at the lowest
B. income price in its industry
C. cash flow C. business aims to offer something
unique to consumers
D. owner’s equity
D. business aims to lower costs
691. The basic accounting equation is 696. A style of leadership that focuses on ac-
A. Income-Expenses = Profit or loss complishing work by relying on contingent
rewards, task instructions, and corrective
B. Liabilities = Assets + Capital actions.
C. Assets = Liabilities + Capital A. Traditional Leadership
D. Income + Profit or loss-Expenses B. Transformational Leadership
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 550
C. Transactional Leadership C. Leading
D. Task-Focused Leadership D. Controlling
697. Reviewing the week’s purchases (inven- 702. In which stage of project management
tory list) for the store does risk analysis take place?
A. Planning A. Initiation
B. Organizing B. Planning
NARAYAN CHANGDER
C. Leading C. Execution
D. Controlling D. Closing
698. Which of the following is not a com- 703. Employees who are in contact with cus-
mon reason for the failure of small busi- tomers can reinforce the company’s ser-
nesses? vice orientation by dressing professionally
and:
A. A lack of sufficient start-up money
A. maintaining a positive attitude.
B. Lack of management experience
B. offering deep discounts to loyal cus-
C. Shortage of skilled workers tomers.
D. failure to manage credit offered to cus- C. referring customer complaints to oth-
tomers ers.
699. What is a business that is owned and op- D. using consensus-building skills.
erated by one person known as?
704. A set of measures built into the produc-
A. Limited liability company tion process to make sure the products or
B. Sole trader services meet certain standards is known
as which of the following?
C. Partnership
A. Performance control program
D. Entrepreneurship
B. Sales standards program
700. Name that concept:Incremental or radical C. Quality control program
improvements to a business idea, or the
generation of new ideas in relation to a D. Standard regulation program
final product, service or process, are the 705. Acquire businesses that engage in similar
result of internal or external influences. activity for example if AT & T purchased
A. Strategy Verizon.
B. Innovation A. Virtual Integration
C. Change B. Horizontal Integration
D. Globalization C. Forward Vertical Integration
D. Chain of Production
701. Enrolling your sales staff in a training
seminar on “Making an Effective Sales 706. The type of leader who is usually the
Pitch.” most efficient is
A. Planning A. autocratic
B. Organizing B. democratic
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 551
C. open A. setting company preformance and
D. situational quality measures
PRACTICE BOOK» NOT FOR SALE
B. keeping company employees on
707. What is the method of corrective action course to accomplish goals
called when an employer raises standards
C. setting company objectioves and tar-
and have employees attend a session to
gets
learn how to improve performance?
D. assigning managers tasks for the
A. Conducting extensive employee train-
sales promotion
ing
B. Expecting employees to rise to the oc- 712. Which business strategy am I? Involves
casion innovation, risk taking, seeking new op-
portunities and growth.
C. Setting lower performance standards
A. Cost Leadership
D. none of above
B. Prospector
708. Which is not a way a business can be so- C. Defender
cially responsible?
D. Differentiation
A. drawing on the skills of employees
713. Categories of factors of production do not
B. avoiding conflicts of interest
include
C. becoming involved in the community
A. Entrepreneurship
D. paying employees correctly
B. Capital
709. Caitlin is doing a walk-through to be sure C. Innovations
that all the employees are on target to D. Labour
complete the company goals. Which func-
tion of management is this? 714. A banking institution is well-suited for a
A. Planning divisional organizational structure broken
down by
B. Leading
A. job function
C. Organizing
B. customer type.
D. Controlling
C. product
710. Delegation is? D. process
A. Managers make all decisions.
715. Planning gives an organization a sense of
B. when the authority and responsibility
A. direction and focus
to carry out specific activities is trans-
ferred from a manager to an employee. B. finances and staff
C. Hierarchical structure of decision- C. results
making. D. where profits will come from
D. Giving free rein or a hands off style
716. How many key knowledge points are cov-
711. which activity would be classified as lead- ered in Chapter 7?
ing A. 2
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 552
B. 3 B. Rules of conduct
C. 4 C. Organizational goals
D. 5 D. Managerial control
717. When creating a presentation, what is 722. The amount of teamwork included in an
this acceptable minimum font size? organizational design is often referred to
as
A. 22 point
A. division of labor
NARAYAN CHANGDER
B. 24 point
B. delegation
C. 26 point
C. staff authority
D. 28 point
D. lateral relations
718. When a customer sees a news story
on television about a certain company or 723. A plant manager, or a department head,
brand, it’s an example of a(n) would be an example of which level of
management?
A. brand promise
A. Middle
B. advertisement
B. Operating
C. touch point.
C. Supervisory
D. slogan.
D. Top
719. A strategy of bringing outside people into
724. Father of Administrative management
the organization and making them feel ob-
ligated to contribute because of their orga-
nizational involvement. A. Mary Parkett
A. Cooperation B. Lillian Gilbert
B. Cooperative Strategy C. Henry Fayol
C. Cooptation D. Elton Mayo
D. Contributory Strategy 725. Which is not a role of The Fair Work Com-
mission?
720. The completion of the transcontinental
railroad in the United States after the Civil A. To represent the views of workers
War helped to fulfill B. Set Awards
A. Reconstruction C. Approve Collective Agreements
B. racial equality D. Determine unfair dismissal claims
C. Manifest Destiny 726. Tyson has decided he wants to be trained
D. conservation of natural resources and certified in cosmetology. Which type
of institution of higher learning could pro-
721. A written set of guidelines issued by an vide him with this?
organization to its workers and manage-
A. Community college
ment to help them conduct their actions
in accordance with its primary values and B. University
ethical standards C. College
A. Corporate vision D. Technical School
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 553
727. Most managers carry out different 732. The process of setting goals and deciding
functions of management. how to accomplish them is
A. organizing
PRACTICE BOOK» NOT FOR SALE
A. one
B. two B. Creating
C. planning
C. three
D. absorbing
D. four
733. Expensive assets that are expected to
728. Which of the following is not a key issue last and be used a long time.
that can be addressed in global sourcing? A. fixed assets
A. Local labour costs B. working capital
B. Environmental Impact C. capital budget
C. Tariffs/tax D. liabilities
D. Efficiency 734. Lean production is based on ?
A. Just in time, Kaizen & Automation
729. This person is responsible for managing
B. Technology, Just In Time, Operations
and organizing the tasks relating to a fu-
neral service, including organizing trans- C. Just in time, Kaizen & Robotics
portation to the cemetery and publishing D. TQM, JIT & Automation
obituaries.
735. Transforms primary resources into manu-
A. Hotel manager factured goods for sale
B. Farm operator and manager A. Primary Sector
C. Construction manager B. Secondary Sector
D. Funeral director C. Tertiary Sector
D. Quaternary Sector
730. The three elements of an operations sys-
tem are 736. Which term describes the total sales of
all the producers in a market?
A. Unfreeze, Movement, Refreeze
A. Market size
B. Technology, Quality, Materials Man- B. Market power
agement
C. Sales Efficiency
C. Inputs, Processes, Output
D. Concentration Ratio
D. Resources, Labour, Product
737. Which of the following is a pull factor im-
731. Which of the following is not a step in pacting globalization on a business’s loca-
resource orchestration? tion?
A. Reduce costs
A. select team members
B. Increase market share
B. develop new products
C. Use extension strategies
C. assign team roles
D. Deregulation of the world’s financial
D. build team cohesion markets
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 554
738. CPD stands for 743. Which of the following is not one of
Mintzberg’s three categories of manage-
A. Containing Professional Development
rial roles?
B. Counting people development
A. Supervisory
C. Continuing professional development
B. Interpersonal
D. none of above C. Decisional
739. The capacity utilization rate is calculated D. Informational
NARAYAN CHANGDER
by
744. A chain of command must have unity of
A. actual input/productive capacity X 100 command, which means that
B. estimated ouput/productive capacity X A. authority should flow from the top of
100 the organization down
C. estimated input/productive capacity X B. employees should only report to one
100 supervisor.
D. actual output/productive capacity X C. employees should focus on tasks re-
100 lated to one skill.
D. the company should be organized in
740. A is an agreement between two par-
functional departments.
ties to carry out a transaction, such as the
sale of goods from a seller to buyer. 745. With this method of appraisal, individ-
A. patent ual employees reflect on their own perfor-
mance.
B. regulation
A. Formative
C. copyright
B. Upward appraisal
D. contract
C. Summative
741. Which level of needs (Maslow) could D. Self-appraisal
be satisfied by extending employee con-
tracts? 746. A program that assists in locating infor-
mation on networks.
A. Self-Esteem
A. search engine
B. Social
B. executive information system
C. Safety
C. management information system
D. Self-Actualisation
D. web-hosting service
742. Product is? 747. Capital brought into the business in ex-
A. non of them change for a percent of ownership in the
business
B. The goods and service combination the
business offers to the market A. Equity financing
C. Main methods are truck, rail, ship, or B. Venture capital
air C. Angel investment
D. none of above D. collateral
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 555
748. James is creating a list of monthly job du- C. Supervision
ties for the managers in his section. This
D. Management
is an example of which management func-
PRACTICE BOOK» NOT FOR SALE
tion? 753. An employee who is assigned to work in
A. Planning foreign country.
B. Organizing A. Local National
C. Leading B. Global National
D. Controlling C. Virtual Expatriate
749. Which of the following is not a disadvan- D. Expatriate
tage of participative management style?
754. Process of influencing others to work to-
A. Lack of contribution by all employees ward the attainment of common goals
B. Conflicts may arise
A. Leading
C. Open communication
B. Planning
D. Time consuming to seek involvement
C. Controlling
750. What should help business people adapt D. Organizing
their communication styles to appeal to
clients from other cultures? 755. To earn repeat business, you must win
A. Being respectful, indifferent, and hon- both the and the of the customer.
est. A. mind, heart
B. Being confident, biased, and manipula- B. heart, pocket
tive.
C. mind, influence
C. Being sensitive, transparent, and de-
manding. D. pocket, influence
D. Being patient, flexible, and empa- 756. To control various business activities in
thetic. an effective manner, managers must first
751. Which of the following is a partici- A. initiate corrective action
pative approach to implementation of
B. identify communication channels
change, communication, empowerment,
group work and support C. set appropriate standards
A. Low-risk strategy D. request employee feedback
B. High-risk strategy
757. requires employer to provide insur-
C. KPI ance for the death, injury, or illness of em-
D. Team work ployees that results from their work.
A. The Affordable Care Act
752. Which department of a business usually
completes recruitment? B. Worker’s Compensation
A. Human Resources C. Equal Pay Act
B. Accounting D. Americans Disabilities Act
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 556
758. Melanie is showing a group of new 763. Why should businesses undertake regu-
employees how to perform work-related lar risk assessments of their business op-
task. What staffing activity is Melaine erations?
performing? A. To minimise hazards and issues that
A. training might create future business loss
B. recuriting B. Because they are told to
C. interviewing C. To give staff something to do
NARAYAN CHANGDER
D. appraising D. To understand how to fix issues that
arise
759. A financial plan for replacing fixed assets
or acquiring new ones is known as a(n) 764. This person would work outside, often
wearing a hard hat. He/She would man-
A. Start up budget age building projects.
B. Capital budget A. Health management
C. Operating budget B. Farm Operations
D. Cash budget C. Construction
760. IT is: D. Public Relations
A. a person in the basement who fixes the 765. Managing the office administrative sup-
computer. port services to help the office run more
B. Intellectual technology smoothly is an example of a job duty for
which business management career?
C. Any computer-based tool that peo-
ple use to work with information and A. Public relations manager
support the information and information- B. Education adminstrator
processing needs of an organization
C. Administrative services manager
D. a scary clown
D. Human resource manager
761. Motivation can best be thought of as 766. The task word “Evaluate” means
A. developing a team spirit. A. Pros and cons
B. communication between employees. B. Provide reasons to support your an-
C. the example managers set for employ- swer
ees. C. Pros and cons and a judgement
D. the reason you do the things you do. D. Explain using examples
762. The perception that the public holds about 767. Advertising falls under which of the fol-
a company. lowing categories in marketing:
A. Workplace Climate A. Marketing communications
B. Workplace Environment B. Marketing research
C. Company Image C. Merchandising
D. Company Spotlight D. Professional selling
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 557
768. When considering employment opportu- B. Strategic management is where man-
nities in business, individuals should con- agers don’t involve employee decision
sider their making
PRACTICE BOOK» NOT FOR SALE
A. wants and needs. C. Strategic management is where you
manage strategically
B. time and money.
D. Strategic management is where you
C. health and safety.
don’t manage strategically
D. talents and skills.
773. This occurs when all major decision mak-
769. One way for employees to demonstrate ing is maintained within a small group of
a service orientation to customers is to re- managers operating close to the head of
inforce verbal communication with: the business.
A. vast personal knowledge. A. Bureacracy
B. positive body language. B. Centralisation
C. good training methods. C. Delegation
D. effective pricing plans D. De-layering
770. Because of a business’s organizational 774. The basic concepts and fundamental prin-
design, its employees are able to work ciples of decent human conduct.
together to come up with a brand-new A. Ethics
product. The business’s employees are en-
gaged in: B. Priorities
A. division of labor. C. Knowledge
B. competition. D. Values
C. authority. 775. Search engines are used to locate infor-
D. innovation. mation on
A. the Internet
771. Mason is the vice president of marketing
at his company. He directly supervises ev- B. extranets
eryone who works in the department. Ma- C. intranets
son has authority.
D. all of these
A. functional
776. Which of the following does a business
B. divisional
plan NOT do?
C. line
A. Establish month-to-moth steps to prof-
D. staff itably operate the business
772. What is Strategic Management? B. Identify necessary legal procedures
for business start-up
A. Strategic management is a leadership
style where managers are less direc- C. Name chief officers of the business
tive and involve employees in decision- D. Convince investors and lenders the
making. business will be profitable
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 558
777. Abilities managers need to understand 782. Today working in teams is
and work well with people is
A. common
A. Human Relations Skills
B. rare
B. Conceptual Skills
C. declining
C. Technical Skills
D. All of the above D. unusual
778. managers receive broad, general 783. What project-management activity in-
NARAYAN CHANGDER
strategies and policies from the top man- volves determining when project tasks
agement, which they then transform into should be performed?
specific goals and plans for first-line man-
A. Scheduling
agers to implement.
A. Top level B. Processing
B. Middle level C. Monitoring
C. Lower level D. Evaluating
D. General
784. three primary factors that affect the or-
779. Where does marketing exist? ganizational structure of a business in-
A. Wherever a product is sold to the cus- clude interpersonal relationships, tasks
tomer and
B. Only in stores A. authority
C. In customer’s mail B. injunction
D. On the Internet C. initiative
780. Which of the following could be used D. attrition
to satisfy Maslow’s Self-Actualisation
Needs? 785. An external organisation that represents
A. Provide employees with a free lunch at and offers advice to employees
work A. Fair Work Commission
B. Provide training so that staff can per-
B. Employer Associations
form new tasks at work
C. Introduce an ‘Employee of the Month’ C. Union
Award D. Human Resource Manager
D. Introduce flexible working hours so
staff can start their working day later 786. Business responsibility can include re-
sponsibility to whom, apart from simply
781. All of the people and organizations that following laws?
might purchase a product is call a
A. The elderly
A. consumer
B. SBA B. The public school system
C. market C. Society
D. trade group D. The business world
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 559
787. What are small businesses sometime re- C. Sticky floor
ferred as? D. Legal barrier
PRACTICE BOOK» NOT FOR SALE
A. Mom and pop businesses
793. Private investors who fund start-up busi-
B. Unsuccessful businesses nesses
C. Short-term businesses A. Equity financing
D. none of above B. Venture capitalists
788. Which of the following is not a business C. Debt financers
resource? D. Angel investors
A. Man-made
794. An operating budget includes projected
B. Capital
A. sales
C. Natural
B. costs
D. Human C. profits
789. A parent company of a franchise is known D. all of these
as:
795. Two way communication
A. Franchisee
A. Encourages discussion and feedback
B. Franchisor
B. A hierarchical approach to manage-
C. Big Daddy ment
D. All of the Above C. Is closed to two people in manage-
790. Which of the following is not a type of ment
business? (best answer) D. Problem solving between indivuduals
A. Sole Tader 796. Which of the following examples best il-
B. Small Business lustrates the creative aspect of directing:
C. Social Enterprise A. A manager instructs employees to de-
velop a new website.
D. Public Listed Company
B. A supervisor tries to determine why
791. Because production occurs continuously his employees aren’t getting along.
throughout the year, Frito Lay company
C. A CEO directs a manager, who directs
can best be described as using
lower level employees.
A. a successful operating system
D. A supervisor spends time getting to
B. a labor intensive operating system know each employee individually.
C. a continuous flow operating system
797. By making changes in policies or resolv-
D. an intermittent flow operating system ing conflicts in the workplace, a manager
is working within his or her
792. When people encounter difficulties in be-
ing promoted to management above a cer- A. information-related role
tain level, they have encountered a B. decision-making role
A. A glass ceiling C. interpersonal role
B. Promotion ceiling D. required role
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 560
798. A set of rules that identifies the values 803. Which of the following documents is
that members of the organization, and es- drafted in the planning stage of project
pecially its leaders, consider to be impor- management:
tant.
A. Project charter
A. Corporate Governance
B. Statement of work
B. Cultural Values
C. Lessons-learned document
C. Human Resource Value
D. Work breakdown structure
NARAYAN CHANGDER
D. Code of Ethics
799. Whose theory was scientific manage- 804. Successful entrepreneurs tend to have all
ment? the following characteristics EXCEPT
A. Taylor A. energetic
B. Maslow B. goal-oriented
C. Adams C. creative
D. Pink D. hesitant
800. Which of the following questions is NOT 805. Which of the following would be appro-
something to be concerned about when hir- priate to include at the very beginning of
ing an employee? a research report:
A. Is this a part-time or full-time posi- A. The research findings
tion?
B. The scientific conclusion
B. How will you handle overtime, holi-
days, sick time, and vacations? C. The research question
C. How often will you pay an employee? D. The paper’s appendix
D. How often will you provide a free
lunch? 806. James is creating a list of monthly job du-
ties for the managers in his section. Which
801. Which of the following is not a BM The- function of management does this fall un-
ory of Motivation? (AOS2) der?
A. Attachment Theory (Harlow) A. Planning
B. Hierarchy of Needs (Maslow) B. Leading
C. Goal Setting Theory (Locke & Latham) C. Organizing
D. Four Drive Theory (Lawrence & D. Controlling
Nohria)
807. Controlling
802. What type of business insurance protects
you from damage to your equipment. A. Keeping the company on track
A. Liability insurance B. Deciding how the company will meet
B. Property insurance goals
C. Health Insurance C. Setting all goals.
D. Professional insurance D. Resolving conflict
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 561
808. Which of the following is a true state- 813. A statement of financial position that re-
ment about projects: ports a company’s assets, liabilities, and
equity as of a specific point in time, such
PRACTICE BOOK» NOT FOR SALE
A. They rely on traditional management
as the end of the company’s fiscal year.
structures.
A. Cash Flow Statement
B. They create goods, not services.
B. Balance Sheet
C. They are short-term undertakings.
C. Income Statement
D. Their processes are more important
than their results. D. Outlay Costs
814. Brenda and Alan are meeting with new
809. Microsoft program used in business to
employees to explain the company’s aims
store and sort data.
and objectives to them. Which function of
A. WORD management is this?
B. EXCEL A. Planning
C. POWERPOINT B. Leading
D. none of above C. Organizing
D. Controlling
810. The lowest level of management is
A. supervisory management 815. Which of the following statements re-
garding a business plan is true?
B. middle management
A. it never needs to be revised
C. senior management
B. A business plan is not necessary.
D. upper management
C. it should be revised yearly
811. Which of the following is no longer a con- D. lenders don’t consider them when
sideration in customers’ buying decisions funding a business
for many products:
816. A company has a goal to launch a new
A. Store location product. After setting this goal, company
B. Price management needs to
C. Quality A. design an organizational chart.
D. Customer service B. determine the work needed to accom-
plish it.
812. Kate works closely with all the com- C. assign tasks to different departments.
pany’s departments to develop computer
software programs that enhance the busi- D. evaluate the effectiveness of this goal.
ness’s ability to communicate and obtain 817. Emphasizing customer service can help a
data. Kate works in the area of business to be:
A. corporate management. A. competitive.
B. marketing communications. B. innovative.
C. business information technology. C. objective.
D. insurance and risk management. D. possessive.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 562
818. What is it called when there is a commit- 823. Supervisors who use management
ment to an organisation conducting their are more directive and controlling.
business in an ethical manner and take re-
A. strategic
sponsibility for social, economic and en-
vironmental consequences and situations- B. tactical
now and in the future. C. ethical
A. Responsibility of Socials
D. formal
B. Social Corporate Responsibility
NARAYAN CHANGDER
824. Which of the following is an example of
C. Corporate Social Responsibility
a non-profit organization?
D. Responsibility
A. Beauty Salon
819. This is an overall summary, or a sales B. Salvation Army
pitch, of all your business offers.
C. ITT Technical Institute
A. Business plan
D. Amazon
B. mission statement
C. executive summary 825. Which type of sampling involves the first
D. marketing plan group surveyed suggesting other people
they know to participate in a similar sur-
820. Checking products against quality stan- vey?
dards at regular intervals is known as A. Snowballing
A. Quality Assurance B. Stratified sampling
B. Quality Control
C. Cluster sampling
C. Total Quality Management
D. Random sampling
D. Common Sense
826. Which career pathway describes the two
821. Which of the following supply chain col- main aspects of the Business, Manage-
laboration techniques helps a company re- ment, and Administration career cluster?
duce transportation costs:
A. Management and Budgeting
A. Reduced supply costs
B. Secretarial and Administration
B. Integrated IT solutions
C. Management and Administration
C. Shipment consolidation
D. Marketing and Business
D. Reduced inventory levels
822. Two managers who possess the same 827. This intellectual property protects owner-
leadership qualities will probably respond ship of all forms of artistic media such as
to a specific situation in literary works, music, films
A. exactly the same way A. Patent
B. different ways B. Trademark
C. according to their positional power C. Trade dress
D. all of the responses D. Copyright
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 563
828. Which of the following types of control 833. Eduardo would like to find a job in the
provides feedback after activity is com- Marketing pathway of the Business, Man-
pleted in order to prevent further devia- agement, and Administration career clus-
PRACTICE BOOK» NOT FOR SALE
tions? ter. He attended his local community col-
A. Preventative control lege and earned his associate’s degree.
Which career choice is available to Eduardo
B. Concurrent control given his highest level of education?
C. Feedback control
A. Advertising Manager
D. Corrective control
B. Sales Representative
829. Which of the following is not an area of
management responsibility? C. Sales Manager
A. Finance D. Marketing Manager
B. Fundraising
C. Operations 834. What is the best advice to keep in mind
as you grow your business?
D. Sales and marketing
A. Hire extra help so you can make more
830. How does promotion benefit customers? money
A. Causes them to postpone buying deci-
B. Grow as quickly as you can
sions
B. Enables them to identify their buying C. Grow at the speed of cash
decisions
D. Use debt to help you grow faster
C. Helps them to select appropriate prod-
ucts 835. The balance achieved in an employment
D. Requires them to spend more on prod- exchange where the rewards offered by
ucts an organization are roughly equivalent to
the contributions that an employee is re-
831. Overseeing/managing an aspect of an quired to make.
operations system is
A. Marketing technique A. Employment Exchange
B. Operations management B. Internal Integration
C. Manufacturing services C. Inducements-Contributions Balance
D. Productivity D. Competitive Advantage
832. Which of the following shows strong com-
munity involvement? (May have more 836. Including the domain name for a com-
than 1 answer.) pany’s website on a managers’ business
A. scholarships for employees to attend cards is an example of
college A. telecommunications
B. attends community events
B. social networking
C. supports local food banks
C. web hosting
D. sponsors student groups such as Girl
Scouts and Boy Scouts D. site promotion
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 564
837. The main reason that human resource C. laws
planning is important. D. ability
A. the number of employees required
843. Mark is unhappy with the way his new
B. identifying staffing needs shirt wrinkles, and he shows it to the
C. when and where these employees are salesperson.Mark’s complaint is an exam-
needed ple of a
D. the qualifications A. true complaint.
NARAYAN CHANGDER
838. What is a common method of recruitment B. false accusation.
to link employee referrals? C. difficult customer.
A. Networking D. hidden complaint.
B. Advertising
844. What is the cooperative action and effort
C. Recruiting of a group of people acting together?
D. none of above A. Teamwork
839. A graphic designed to provide a quick B. Groupwork
view of key financial performance indica- C. Cooperation
tors is called a(n)
D. none of above
A. bar chart
845. research and analyse business environ-
B. balance sheet
ments is what step in a typical policy de-
C. economic infographic velopment process
D. financial dashboard A. 1
840. Which is an activity associated with the B. 2
organizing function of management? C. 3
A. Developing a mission statement D. 4
B. Determining the division of labor
846. There are two categories of outputs.
C. Inspecting the quality of outputs What are they?
D. Providing employees with feedback A. Goods and values
841. Another name for investment bank is B. Goods and services
A. Underwriter C. Services and services
B. Commercial Bank D. Goods and things
C. Factor 847. A disadvantage of the line and staff au-
D. Venture Capitalist thority structure is that it can lead to
842. The three common constraints on a A. line-staff conflict
project are scope, budget, and B. overstaffing
A. time C. staff turnover
B. technology D. understaffing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 565
848. Which of the following is NOT a career in B. Bad Result
the finance industry? C. Neutral
PRACTICE BOOK» NOT FOR SALE
A. Credit Analyst D. none of above
B. Marketing professional
854. Principles of Locke & Latham’s theory
C. Insurance Agent
A. Clear, specific, challenging (not over-
D. Loan Officer
whelming), feedback
849. Specific indicators that are used to mea- B. Specific, measurable, attainable, rele-
sure progress or achievement. vance, time
A. HR Scorecard C. Acquire, bond, learn, defend
B. HR Metrics D. Clarity, challenge, commitment, task
C. HR Dashboard complexity, feedback
D. HR Accounting 855. A method of dispute resolution in which
the FWC makes a legally-binding decision.
850. What does PDS stand for in terms of in-
surance? A. Mediation
A. Product Differentiation System B. Conciliation
B. Policy Disclosure System C. Arbitration
C. Product Disclosure Statement D. Grievance Procedure
D. Policy Differentiation Statement 856. Type of inventory
851. Which of the following best describes A. finished products
Theory X? B. work in progress
A. Workers dislike their work and must C. raw material
be supervised closely
D. stock
B. Workers are all self-motivated
C. Neither A or B 857. Which of the following terms refers to
the flow of authority within an organiza-
D. none of above
tion:
852. Although people skills are the key to be- A. Division of labor
come a successful HR professional,
B. Functional structure
skills are important as well.
C. Chain of command
A. technical
D. Innovation
B. writing
C. math 858. Qualitative factors in deciding location of
a business
D. reading
A. break even analysis
853. If there was a decrease in “rate of pro-
ductivity growth” as a KPI, is this a good B. the pull of market
result or a bad result? C. safety
A. Good Result D. transportation cost
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 566
859. Nick is the CEO of a business. The vice A. Leading
presidents of marketing, product develop- B. Controlling
ment, finance, and operations all report to
him, and they each have their own teams C. Planning
made up of several employees. This is a D. Organizing
structure.
864. Difference between current assets and
A. matrix current liabilities.
B. divisional A. working capital
NARAYAN CHANGDER
C. functional B. depreciation
D. specialized C. liabilities
860. The level of management that decides the D. accounts receivable record
goals of the business, how to meet them 865. Which function of management involves
and how to use the company resources is creating goals, objectives, and ways to
achieve them?
A. Supervisory A. Organizing
B. Middle B. Planning
C. Senior C. Controlling
D. Conceptual D. Leading
861. Involves comparing products or services 866. Which of the following is probably NOT a
against the products or services of com- mid-management job?
petitors
A. customer service manager
A. Benchmarking
B. information technology manager
B. Quality circle C. marketing manager
C. Continuous improvement D. vice-president of human resources
D. Kanban
867. What is leadership?
862. The triple bottom line, or other factors A. Ability to tell people what to do
that operations managers need to consider
B. Ability to sit back and let people do the
fall into three categories:
work
A. Economic, Psychological and Ecologi-
C. Ability to do whatever you want
cal
D. Ability to influence individuals and
B. Economic, Etiological and Social
groups to accomplish important goals
C. Economic, Psychological and Environ-
mental 868. Laws that support organizations to take
action to eliminate discrimination are
D. Economic, Social and Environmental
A. Equal Employment Laws
863. Bryan is conducting a monthly analysis B. Equal Opportune Laws
to see if his section has performed all
the tasks and objectives they set for the C. Equal Organizations Laws
month. D. Equal Opportunity Laws
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 567
869. Which of the following factors should be 874. The person responsible for the execu-
considered by a company when developing tion of a construction project. Construc-
its management strategy? tion managers must be available-often 24
PRACTICE BOOK» NOT FOR SALE
A. the type and characteristics of the hours a day-to deal with delays, bad
business weather, or emergencies at the jobsite.
A. Administrative Services Manager
B. the type of work and the workers in the
company B. Construction Manger
C. the business environment C. Health Service manger
D. all of these factors should be consid- D. Funeral Director
ered
875. When Andrew helps Mrs. Green select a
870. A combination of different advertising product, he summarizes Mrs. Green’s re-
strategiesthat allows you to achieve spe- quest in his own words to clarify his un-
cific goals for your product. derstanding. Andrew is engaging in:
A. Product Mix A. creative thinking.
B. Promotional Mix B. nonverbal communication.
C. 4 P’s Mix C. active listening.
D. Strategy Mix D. idle conversation.
876. Modelling Expected Behavior is part of
871. What businesses need when achieving a
which managerial function?
business objectives
A. Planning
A. make a profit
B. Organizing
B. staff performance
C. Leading
C. expanding the business
D. Controlling
D. increasing market share
877. A secured, private network that compa-
872. Which of the following is NOT an impor- nies need in order to share selected infor-
tant human relations skill needed by lead- mation with selected people outside the or-
ers and managers? ganization is an
A. high level of education A. ISP
B. communication B. intranet
C. team building C. EIS
D. self understanding D. extranet
873. A policy is 878. “I’m lovin’ it” is one of McDonald’s fa-
A. a list of rules mous brand
B. a code of conduct A. slogans.
C. a marketing tool B. logos.
D. a broad set of guidelines to be fol- C. promises.
lowed by all employees D. touch points.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 568
879. An organization with a wide span of con- 884. What is the tern for revenue left over af-
trol usually ter paying business costs?
A. does not give managers enough direct A. profit
reports. B. gross pay
B. uses a divisional organizational struc- C. inventory
ture.
D. loss
C. gives little control to the CEO.
885. Effective leaders have certain qualities
NARAYAN CHANGDER
D. has a lack of middle managers. that are helpful in creating a productive
880. How many steps are there in a typical work environment. These qualities include
policy development process?
A. Integrity
A. 5
B. Team oriented
B. 6
C. Preseverance
C. 7
D. All of the above
D. 8
886. Name that concept:Every business deci-
881. What is a “market share”? sion has moral implications. These conse-
A. the percentage of total sales of prod- quences can be significant for internal and
uct that is sold by a company in the mar- external stakeholders and the natural en-
ketplace vironment.
B. the same thing as a share of stock A. Innovation
C. like a ride share but for businesses B. Strategy
D. how much you can change your prices C. Ethics
when demand changes D. Change
882. John D. Rockefeller and Andrew Carnegie 887. is the principle in which an employee
are similar in that they both are should have only one supervisor to whom
he/she is responsible.
A. former military members
A. Chain of command
B. philanthropists
B. span of control
C. fair businessmen who treated their
workers well C. single supervision
D. made huge fortunes in the automobile D. none of above
industry 888. Limitations of surveys include:
883. Planning the involves longer time frame A. Respondents may not take the re-
and the entire organizations goals is called search seriously, lowering the validity of
the data.
A. tactical
B. The cost may be too much for smaller
B. contingency
companies.
C. strategic C. It is difficult to plan for all the various
D. organized answers that participants might give.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 569
D. The possibility of researcher bias. 894. The response of people behaving differ-
ently when they are receiving attention is
889. When a business takes advantage of the known as
PRACTICE BOOK» NOT FOR SALE
huge wage difference between workers
A. Esprit de corps
doing the same job but in a different area
of the world. B. Hawthorne effect
A. Teleworking C. Theory X
B. Offshoring D. Theory Y
C. Homeworking 895. Helping to resolve a dispute between
two workers in the department is an ex-
D. Downshifting
ample of which business management func-
890. Job specific skills are know as tion?
A. basic skills A. Controlling
B. Organizing
B. skills of the trade
C. Leading
C. math skills
D. Planning
D. communication skills
896. An evaluation of how well the human re-
891. The Practice of Management written by sources department is performing its re-
A. Terry sponsibilities and objectives.
B. Louis Allan A. Human Resource Scorecard
C. Hendry Fayol B. Human Resource Audit
C. Human Resource Accounting
D. Peter F Drucker
D. Human Resource Value
892. What are the disadvantage of online se-
lection? 897. Which of the following is an external
factor that impacts the Human Resource
A. test technical skills but not broader Plan?
skills
A. Change in business strategy
B. relies on the applicant giving honest
answers to the test questions or tasks. B. Change in labor relations
C. Changes in business finance
C. doesn’t assess actual skill
D. Changes in education
D. It may not be secure
898. Which type of degree requires 120 Hours
893. Some ethical considerations companies of coursework, some of which is general
have to consider when conducting market and some of which is based on your ma-
research include: jor?
A. Vulnerable groups A. Doctoral degree
B. Leading questions B. Bachelor’s degree
C. Purpose of use C. Associate degree
D. Voluntary involvement D. Master’s degree
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 570
899. According to Herzberg, which of the fol- B. Organizing.
lowing is likely to increase worker motiva- C. Controlling.
tion?
D. Coordination
A. higher pay
905. The original cost of an asset less its accu-
B. challenging work
mulated depreciation is the
C. closer supervision
A. balance value
D. better benefits
B. book value
NARAYAN CHANGDER
900. What is NOT a skill that a leader must C. depreciated value
have? D. residual value
A. Moitivation
906. innovation exists when new products
B. Focus are created or existing products are im-
C. Laziness proved.
D. Communication A. Process
B. Product
901. The way people consciously or uncon-
sciously change messages is called C. Positioning
A. Feedback D. Adaptive
B. Distortion 907. Study of the movements of both the
C. Noise workers and the machine to eliminate
wasteful movement is
D. Misunderstanding
A. Fatigue study.
902. Network of linked computers that serves B. Time study
users in a single building or building com-
C. Motion study.
plex.
D. Work-study.
A. LAN
B. WAN 908. An examination of demographic and so-
cial forces influencing the long-term com-
C. VoIP
position of the labor force and the future
D. data availability of employees.
903. Which function of management involves A. Environmental Scanning
dividing work into manageable segments B. Environmental Uncertainty
in order to achieve goals? C. External Adaptation
A. organizing D. Field Survey
B. planning
909. What is another term for horizontal orga-
C. leading nization?
D. controlling A. Spreading out the organization
904. The first and foremost function of man- B. Stretching the organization
agement is C. Expanding the organization
A. Planning. D. Flattening the organization
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 571
910. Avery, who manages a silk-screening and 915. This type of culture is where a few indi-
embroidery business, has set a goal of viduals retain the essential power.
increasing sales by 15% in the next six
PRACTICE BOOK» NOT FOR SALE
A. Role culture
months. To reach his goal, he has in-
creased the business’s advertising budget. B. Professed culture
This is an example of the function of
C. Power culture
management.
A. planning D. Person culture
B. directing 916. Which of the following is a career area in
C. organizing marketing:
D. controlling A. Banking services
911. The process where formal authority is B. Administrative services
passed down through the hierarchy is C. General management
called?
D. Merchandising
A. Accountability
B. Delegation 917. The selection and training of individuals
C. Responsibility for specific job functions and delegating
them the assosciated responsibilities
D. Planning
A. Staffing
912. Analyzing the solutions involves
B. Employment
A. brainstorming ideas
C. Managing
B. listing advantages and disadvantages
C. determining symptoms D. Operations
D. identifying the problem 918. Leaders have ambition and persistence in
reaching goals. They are self-starters who
913. What should employees do to maintain a
plan what they want and do it, this is
customer-service mindset?
called
A. Listen to the words of soothing songs.
A. judgement
B. Maximize conversations with cowork-
ers. B. intiative
C. Devote their full attention to cus- C. power
tomers.
D. reward
D. Decide how to spend their break time.
919. Which of the following is NOT a barrier
914. Customers have the right to expect em-
to effective decision making?
ployees to be
A. Panic
A. self-serving.
B. goal-oriented. B. Complacency
C. open-minded. C. Intuition
D. well-informed. D. Indecisiveness
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 572
920. What is Company A’s market share if its 925. is the concept that ll businesses have
sales revenue amount to $100 million in an obligation to operate in a way that will
an industry with annual sales of $500 mil- have a positive impact on society.
lion?
A. Ethical objectives
A. 5%
B. Corporate social responsibility
B. 20%
C. Business tactics
C. 50%
D. Vision statement
NARAYAN CHANGDER
D. 80$
921. What are the methods does job analysis 926. A system used to record, classify, sum-
uses for? marize and report the financial position of
A. critical incident technique a business is known as which of the fol-
lowing?
B. observation method
A. Mangement
C. working conditions
D. interview method B. Distribution
E. questionnaires C. Accounting
922. A disadvantage to line authority is that D. Human resources
the managers have who help with
927. Industrial markets can change due to
their responsibilities.
which of the following?
A. few employees
A. Competitor’s prices
B. few specialists
B. The economy
C. many employees
D. many specialists C. The company’s social responsibility
D. Consumer behavior
923. The money a business owes and the pay-
ments it makes for credit purchases are
928. When a business publicly pledges to pro-
recorded in the
vide all of its customers with quick, cour-
A. cash record teous service, what is it doing?
B. depreciation record A. Making a brand promise.
C. accounts payable record
B. Developing a campaign platform.
D. accounts receivable record
C. Stating industry policies.
924. Which statement is INCORRECT about
D. Establishing product position.
firewalls?
A. Firewalls use special software to 929. Labour redeployment is
screen people who enter a network.
A. Offering voluntary redundancy
B. Firewalls use special software to
screen people who exit a network. B. Finding a new supplier
C. Firewalls are totally hacker-proof. C. Moving employees to different
jobs/location in the business
D. Firewalls protect information from out-
siders who try to break into networks. D. Implementing involuntary redundancy
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 573
930. Helping individuals obtain financing for a 935. The interrelationship between manage-
home or borrow funds for their child to ment styles and skills provide opportunity
attend college are examples of duties for to assess ?
PRACTICE BOOK» NOT FOR SALE
which business management career?
A. Whether the management is effective
A. Education administrator B. Whether employees are satisfied
B. Health service manager C. Whether individuals are working well
C. Loan officer and counselor D. Whether profit is being made
D. Public relations manager
936. A(n) is an invention or creation that
931. A complaint is any expression of is brand new.
A. dissatisfaction. A. Development
B. anger. B. Innovation
C. sadness. C. Imporvement
D. gratitude. D. Advancement
937. Dun & Bradstreet is an example of a busi-
932. Steve manages employees who are
ness that supports other businesses by
highly skilled and need little supervision.
providing
Therefore, he can supervise quite a few
employees at once. Steve’s span of con- A. web page design
trol is B. electronic shopping carts
A. open C. specialized research reports
B. wide D. online credit card processing
C. narrow
938. You can recognize a true brand promise if
D. tight it
933. A forecast or sales revenue a company A. is authentic and credible.
expects to receive for a specified period. B. is tied to features and product specifi-
A. sales budget cations
B. cash budget C. relates to just the business’s market-
ing activities
C. capital budget
D. demonstrates the similarities between
D. operating budget the brand and its competitors
934. Which of the following is not one of the 939. The three common constraints on a
6 types of businesses? project are scope, budget, and
A. Partnership A. time
B. Sole trader B. technology
C. Public companies C. ability
D. Government D. laws
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 574
940. Of the five value dimensions, which fo- C. organizing
cuses on being able to do things “fast” D. planning
consistently?
A. Innovation 945. First step in planning is
B. Responsiveness A. setting standards
C. Delivery B. setting goals
D. Cost C. writing a mission statement
NARAYAN CHANGDER
D. organizing staff
941. A cash flow plan that assigns an expense
to every dollar of your income, wherein 946. The facts and figures that businesses gen-
the total income minus the total expenses erate are called
equals zero
A. Data
A. Zero-Based Budget
B. Information
B. cash flow system
C. Figures
C. line item budget
D. Information points
D. sinking fund
947. What is a private sector business that
942. What is the advantage of internal recruit- distributes profit to benefit the commu-
ment? nity rather than individual shareholders
A. Employees are already known to the called?
employer, so choice may be easier. A. Corporate social responsibility
B. Applicants may be set in their ways B. Social enterprise
and not open to new ideas.
C. Social entrepreneur
C. There may be no-one suitable from
within the business. D. Government enterprise
D. none of above 948. Select the sentence below that has been
correctly written
943. What employers expect from employ-
ees? A. The stock was to expensive for me to
buy
A. be punctual
B. I think she said she worked their
B. be committed to their job
C. Jim’s patients was wearing thin by the
C. sign an employment contract end of the day
D. provide excellent customer service D. I left the correspondence on the man-
E. follow reasonable requests ager’s desk
944. Dividing a large sales territory into 2 949. Competency based training is?
smaller territories and assigning managers A. Where units of competency can be indi-
and salespersons to the territory is part of vidualised by the organisation to meet the
which management function? actual needs of the workplace
A. controlling B. Learning basic skills necessary for any
B. leading workplace
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 575
C. Being made aware of opportunities for 954. A manager must provide directions and
further training vision to inspire employees. This is called
PRACTICE BOOK» NOT FOR SALE
D. Learning required legal skills such as
OH & S and safety procedures A. planning
B. organizing
950. Which of the following is a true state-
ment regarding touch points: C. leading
D. controlling
A. A business must prioritize which touch
points to focus on. 955. Eva works at a hotel registration desk.
B. There are about 12 touch points for When a customer was checking in tonight,
any given brand. Evareminded him that checkout time would
be 11:00 a.m. “No, it’s not!” he ex-
C. Pre-sale touch points are more impor- claimed. “It’s alwaysat 11:30!” Eva’s
tant than post-sale touch points. customer is
D. Every brand has the same touch A. suspicious.
points.
B. impatient.
951. Which of the following is NOT considered C. argumentative.
good behavior where business ethics are D. leave-me-alone.
concerned?
A. Bait-and-switch advertising 956. Involved in intellectual, knowledge-
based activities that generate and share
B. Fairness information, e.g. R & D
C. Truthfulness A. Primary Sector
D. Taking into account the well-being of B. Secondary Sector
everyone involved C. Tertiary Sector
952. Money invested in a business by in- D. Quaternary Sector
vestors who form partnerships or groups
957. coordinating business activities is an im-
to pool investments.
portant aspect of the organizing function
A. equity financing of management because it
B. venture capital A. Establishes clear relationships among
the companies resources
C. angel investor
B. defines the company’s mission state-
D. collateral ment
953. Which is not a strategy related to quality C. enables the business to prepare pre-
management? cise forecasts
A. TQM D. ensures that the employees under-
stand all the business activities
B. Quality Control
958. Maslow’s Hierarchy of Needs is a theory
C. Quality Assurance
that can help explain how and why people
D. Quality Checks are
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 576
A. wealthy 964. Which business strategy am I? Selling
B. motivated your products and services at a lower cost
usually achieved by technological innova-
C. talented tions that improve efficiency or low cost
D. intelligent labor.
959. Data storage systems over widely dis- A. Focus
persed Internet networks are called B. Cost of Leadership
A. The Web
NARAYAN CHANGDER
C. Analyzer
B. The Net
D. Reactor
C. A cloud
D. A WAN 965. When managers increase employees’
salaries when they meet the goals estab-
960. The desire for status, power and material lished for them, what type of power are
goods is known as which drive? the managers using?
A. Drive to Acquire A. position
B. Drive to Bond
B. reward
C. Drive to Learn
C. expert
D. Drive to Defend
D. identity
961. Which is NOTa management skill?
A. IT skills 966. People have
B. Interpersonal skills A. Economic wants
C. Delegating B. Non economic wants
D. Planning C. Both economic wants and non eco-
nomic wants
962. People will productively if put in the right
environment is a belief held by D. No wants
A. Theory X
967. The process of planning a business’s pro-
B. Theory Y duction needs is known as
C. Theory Z A. Dispatching
D. All of the above
B. Scheduling
963. Which of the following are examples of C. Job Design
top-level management job titles:
D. Production Planning
A. Floor supervisor, area supervisor, and
section manager 968. The leadership trait that involves careful
B. President, senior vice president, and decision making is
chief executive officer A. understanding
C. Collections supervisor, crew chief, and
B. judgment
production supervisor
C. communication
D. District manager, department head,
and regional sales manager D. initiative
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 577
969. If an employee’s primary responsibilities 974. Which of the following skills can an em-
involve planning, coordinating, and con- ployee use to uncover the hidden reason
trolling the resources necessary to provide for acustomer’s complaint:
PRACTICE BOOK» NOT FOR SALE
the business’s products, s/he works in the A. Accounting
area of
B. Questioning
A. business information technology.
C. Selling
B. securities and investments.
D. Marketing
C. marketing research.
D. operations management. 975. Areas of focus for market research in-
clude:
970. Which does not belong A. Product-based research
A. Planning B. Promotion-based research
B. Controlling C. Price-based research
C. Financing D. Place-based research
D. Leading 976. Which of the following is a benefit of the
division of labor:
971. Which of the following is not an example
of labour? A. More direct oversight
A. Manual workers B. Teamwork opportunities
B. skilled workers C. Increased efficiency
C. Entrepreneurship D. Professional development
D. Intellectual ideas 977. Leaders who can see all sides of a prob-
lem and not make biased judgments or
972. What are the conditions of employment statements are said to possess
A. the number of hours an employee is ex- A. initiative
pected to work
B. courage
B. work life balance
C. judgment
C. annual leave entitlements and other D. objectivity
entitlements
D. public holidays 978. An emergency number to call for aid
should be posted
E. redundancy pay
A. at the first aid station
973. Management is the art and science of de- B. on the company’s website
cision making leadership
C. next to, near, or on the phone
A. Harold Koontz
D. near the nurse’s station
B. Donalad J Clough
979. A well-planned organizational design
C. Louis Allan
helps a business to better compete be-
D. Terry cause
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 578
A. competitors don’t have organizational 984. This refers to an organisation that has
structures. many rules and procedures and set way of
doing things.
B. it cuts down on communication.
A. De-layering
C. the business is more productive.
B. Centralisation
D. the business has more money.
C. Delegation
980. These are the main methods of primary D. Bureaucracy
NARAYAN CHANGDER
market research:
985. What is a benefit to using teams to make
A. Surveys decisions?
B. Media articles A. One person DOMINATING!!!!
C. Observations B. Going with the first idea
D. Focus groups C. Social pressures to conform to ideas
D. Easier to understand or accept the de-
981. Licensing is important for many occupa- cisions.
tions including the following:
986. Which of the following is NOT a function
A. Administration
of management?
B. Banking
A. Organize
C. Dog walking B. Finance
D. Teaching C. Control
982. The direct benefit that a business re- D. Plan
ceives when its salespeople can answer 987. Our economy has shifted from a service
customers’ inquiries is that: economy to a(n) economy.
A. well-informed salespeople develop A. experience
confidence in themselves.
B. entertainment
B. customers like knowledgeable sales- C. manufacturing
people.
D. agricultural
C. customers get the information they
want. 988. The employment process is carried out by
which department?
D. knowledgeable salespeople are more
likely to make sales. A. Marketing
B. Distribution
983. What the four type of Selection options
C. Management
A. Interviews.
D. Human Resources
B. Application forms
989. The first task in the HR management ac-
C. Online selection. tivity of staffing is
D. Medical examinations. A. determine job descriptions
E. Tests. B. screening and selecting applicants
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 579
C. determining need Which of the following is NOT a part of
D. recruiting the HR (workforce) plan:
PRACTICE BOOK» NOT FOR SALE
A. Appraisal
990. When you see Ford vehicles in the latest
B. Paid time-off
James Bond movie or Tom Hanks putting
on a pair on Nikes on-screen, that is an C. Recruitment
example of D. Redundancy (lay-off)
A. Free samples 995. Directing is pervasive, which means that
B. Product Placement it
C. Social Media Contest A. never stops.
D. Point-of-Purchase Promotion B. happens at every level of the organiza-
tion.
991. What is internal recruitment? C. involves interpersonal communica-
A. Recruiting using interviews only tion.
B. Recruiting from outwith the organisa- D. flows from the top down.
tion 996. Expensive assets of a business that are
C. Recruiting using online applications expected to last and be used for a long
only time are known as
D. Recruiting from within the organisa- A. Fixed assets
tion B. Depreciated assets
992. Most management principles are devel- C. Obsolete assets
oped first through observation and then D. Stable assets
drawing conclusions or about research
findings. 997. Which of the following is NOT a rea-
son businesses need to maintain financial
A. hierarchy records?
B. deductions A. To determine the kinds and values of
C. change assests
D. sensitivity B. To track the financial progtess of the
business
993. Which of the following terms describes C. To prepare financial forms and reports
the ability to achieve a desired result with- required by the government
out wasted energy or effort?
D. To provide financial information to
A. Effectiveness competitors
B. Capability 998. To be considered a manager, you must
C. Sustainability A. regularly complete all 5 management
D. Efficiency functions
B. have authority over other jobs
994. There are four parts to the HR plan,
which follow an individual’s career path as C. have authority over other people
the employee progresses in the business. D. all of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 580
999. Reviewing 10 employee applications for C. Service
cashier vacancy D. none of above
A. Planning
1005. “Business information management” is
B. Organizing a term sometimes used to refer to as?
C. Leading A. Business Analytics
D. Controlling
B. office management
NARAYAN CHANGDER
1000. Pioneer of Human Relation is C. Human resources Management
A. Mary Parkett D. Supply chain Management
B. Lillian Gilberth
1006. Which task would best be performed by
C. Henry Fayol a worker in Accounting?
D. Elton Mayo A. developing creative ideas to sell a
product
1001. Corporate culture is?
B. monitoring employees’ salary informa-
A. An internal factor tion
B. An external factor C. recruiting new workers to fill jobs
C. A factor that a business has no control
D. answering phone calls and e-mails
over
D. A factor that influences the longevity 1007. An advantage of Performance related
of business life pay (motivation theory) is?
A. Direct financial reward to employees
1002. Customers are more likely to be loyal to
brands that they feel B. Sanctions can act as motivator
A. have the best touch points C. Continuity of knowledge
B. create the most memorable slogans D. Increase employee contribution
C. have the best logos 1008. financing is the money needed to
D. share their values and beliefs. pay for the current operating activities of
a business.
1003. Why should managers know how to do
A. Long-Term
the work of the workers they supervise?
B. Owner
A. To coordinate employees’ efforts
C. Short-Term
B. To establish a chain of command
D. Start-up
C. To create a team spirit among employ-
ees 1009. In this type of business, the owner is
D. To have realistic expectations for responsible for all debts.
workers A. Corporation
1004. A physical item that can be touched. B. Sole-Proprietorship
A. Product C. Partnership
B. Good D. Cooperative
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 581
1010. Successful managers are C. Business Information Management
A. good communicators D. Human Resources Management
PRACTICE BOOK» NOT FOR SALE
B. relationship builders
1016. Which of the following does not de-
C. decision makers scribe a typical small business?
D. all of the above A. it is dominant in its field
1011. What does it mean to incorporate a busi- B. the owner is usually the manager
ness?
C. it serves a small market
A. The business has a legal name
D. it operates in one or a few locations
B. The business has an ABN
C. The business becomes a separate le- 1017. Which of the following statements
gal entity as a company about leadership is true?
D. The business is registered for GST A. Leadership is directly related to the
success of the organization.
1012. Money provided by large investors to fi-
nance new products/businesses is known B. Studies have identified certain charac-
as teristics that effective leaders possess
A. venture capital C. Good leadership requires excellent hu-
man relation skills.
B. Inventory
C. Small Business Administration (SBA) D. All of the responses
D. entrepreneurship 1018. Which of the following are examples of
first-line management job titles:
1013. Which function of management involves
motivating, directing and coordinating em- A. President, senior vice president, and
ployees chief executive officer
A. leading B. Collections supervisor, crew chief, and
B. staffing production supervisor
C. organizing C. Company vice president, department
head, and regional sales manager
D. controlling
D. Senior vice president, chief financial
1014. Which act regulates Social Security? officer, and regional vice president
A. Fair Labor Standards Act
1019. Which of the following laws guaranteed
B. Federal Unemployment Tax Act men and women were given equal pay for
C. Federal Insurance Contributions Act equal work?
D. State Unemployment Tax Act A. The Equal Pay Act of 1963
1015. Which is NOT a career in the Business B. The Civil Right Act of 1964
management cluster? C. The Occupational Safety and Health
A. General Management Act of 1970
B. Principal D. The Labor Standards Act of 1938
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 582
1020. The Fair Work Act 2009 established C. employees
three independent government bodies to D. sales revenue
oversee and operate the Australian sys-
tem of workplace relations. Which of the 1025. Which business strategy am I? Selects
following is NOT one of the 3 independent a defined segment of an industry and tar-
government bodies? gets its strategy to serve them to the ex-
A. Fair Work Advisory clusion of others, AKA niche strategy.
B. Fair Work Comission A. Focus
NARAYAN CHANGDER
C. Fair Work Ombudsman B. Differentiation
C. Analyzer
D. Fair Work Division of the Federal Court
and Federal Curcuit Court of Australia D. Prospector
1021. Textronics, Inc. manufactures and sells 1026. The easiest way to learn your com-
its computer chips in six countries. It pany’s brand promise is to
employs over 8, 000 people worldwide. A. ask your manager or supervisor.
Which organizational structure makes the
B. look on the website
most sense for Textronics, Inc.?
C. talk to your coworkers
A. Divisional
D. make an educated guess
B. Functional
C. Matrix 1027. Goals specify future needs, plans spec-
ify
D. Specialized
A. today’s means
1022. Helping a new employee learn ways to B. tomorrows means
manage time effectively is an example of
which business management function? C. tomorrow goal
A. Controlling D. next week’s goals
B. Leading 1028. Which of the following is an element of
C. Organizing any project:
D. Planning A. Technology
B. Outcome
1023. EMS stands for?
C. Natural resources
A. Environmental Marketing Strategy
D. Board of directors
B. Environmental Marketing System
1029. A manager who provides leadership
C. Environmental Management Strategy
within the company or interacts with oth-
D. Environmental Management System ers outside the organization is said to be
working within his or her
1024. Which of the following do many busi-
nesses believe to be their most important A. information-related role
resource? B. decision-making role
A. office supplies C. interpersonal role
B. equipment D. required role
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 583
1030. Abilities that help managers understand 1035. Which of the following types of termi-
how different parts of a business relate to nation are voluntary?
one another or to the business as a whole
PRACTICE BOOK» NOT FOR SALE
A. Retirement and Resignation
is
B. Dismissal and Retirement
A. Technical Skills
B. Conceptual Skills C. Resignation and Dismissal
C. Human Relationship Skills D. Dismissal and Retrenchment
D. Principles 1036. The management theory that is directed
1031. A popular approach to strategy develop- at organizational improvement through un-
ment which involves analyzing strengths, derstanding employee motivation and be-
weaknesses, opportunities, and threats. havior is:
A. Hawthorne Effect A. quality management
B. SWOT method B. behavioral management
C. Unobtrusive Measures C. administrative management
D. Transactional Leadership D. classical management
1032. This leadership style is one that can 1037. The UN Global Compact has how many
be beneficial with experienced employees principles?
who can complete work on their own.
A. 5
A. authoritarian
B. 8
B. democratic
C. delegating C. 10
D. none of the above. D. 15
1033. Managers usually find greater em- 1038. Managers have access to specialists for
ployee respect and support for work rules advice and assistance in
when A. line organization
A. the rules are applied only to serious
B. line-and-staff organization
problems,
B. each individual is treated differently, C. a project or matrix organization
C. employees help to develop the rules D. none of the responses
D. the work rules are part of a union con- 1039. Leaders have ambition and persistence
tract. in reaching goals. They are self-starters
who plan what they want to do and then
1034. Explains a company’s reason for exis-
do it. This leadership trait is called
tence.
A. Mission Statement A. initiative
B. Vision Statement B. courage
C. Purpose Statement C. judgment
D. Value Statement D. objectivity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 584
1040. Studies the way work is organized and 1045. Which of the following is an example of
the procedures used to complete a job in intellectual capital:
order to increase worker productivity
A. RSS feeds
A. classical managment
B. Wikis
B. administrative management
C. Video conferencing
C. behavioral management
D. Search
D. quality managment
NARAYAN CHANGDER
1046. A sign or indication of something that
1041. Brianna works for a marketing agency, appears to be the problem
and she is skilled at graphic design. She
A. Solution
spends all of her time creating graphics,
rather than working on any other aspects B. Feedback
of the marketing campaign. Brianna is C. Cause
A. allocating resources. D. Symptom
B. coordinating activities.
1047. is power to carry out a task and
C. an authoritative figure. make decisions.
D. a specialized worker. A. Delegation
1042. Henry Fayol laid down B. Micromanagement
A. 12 principles. C. Efficiency
B. 13 principles. D. Authority
C. 14 principles. 1048. Which of the following is an example of
D. 15 principles. a project that enhanced an existing prod-
uct:
1043. Which of the following segments of the
A. The construction of the Empire State
manufacturing industry is the only one to
Building
expect job growth?
B. A medication that cures a life-
A. Coordination and inspection
threatening illness
B. Production and assembly
C. A software update for your computer
C. Installation, maintenance and repair
D. The sequel to your favorite movie
D. All manufacturing jobs are expected to
decline 1049. A(n) exists when only one company
provides a product or service without com-
1044. The obligation to do an assigned task petition from other companies.
A. authority A. Oligopoly
B. responsibility B. Monopoly
C. accountability C. Price discrimination
D. productivity D. None of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 585
1050. What type of requirements for business 1055. Laissez-Faire management style is also
careers varies greatly depending on the called
specific job?
PRACTICE BOOK» NOT FOR SALE
A. Structured approach
A. Educational B. Authoritative approach
B. Personal C. Hands off style
C. Social D. Individual approach
D. Financial
1056. Preston wants to be an accountant.
1051. is the movement of employees in When he decides on a college education,
and out of a business over a given period which would be the best choice for this ca-
of time reer?
A. Unemployment A. community college with an earned as-
sociate’s degree
B. Downshifting
B. state college with an earned bache-
C. Labour Turnover lor’s degree
D. Redundancy C. graduate school with an earned mas-
ter’s degree
1052. A carefully developed overall approach
to leading an organization: D. graduate school with an earned doc-
torate degree
A. management strategy
1057. Professionals in Business Informa-
B. management science
tion Management gather and mar-
C. Industrial Revolution ket trends, create and manage large
D. business competition databases, and analyze data in order to
help managers make organizational deci-
1053. Local government by-laws ensure that sions.
everyone is trading fairly. Which of the A. surveys
following are examples of local govern-
B. financial information
ment by-laws?
C. personal information
A. Trade practices Act
D. data
B. Food trading regulations
C. Road safety Act 1058. An asset pledged that will be claimed by
the lender if the loan is not repaid
D. OHS Act
A. home mortgage
1054. One thing all successful entrepreneurs B. collateral
have in common, regardless of industry, is
C. insurance
A. athleticism
D. venture capital
B. passion
1059. One advantage an entrepreneur gains
C. closed-mindedness
by forming a corporation to raise capital
D. negativity is
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 586
A. The number of owners remains the D. Avoid names that are hard to spell or
same pronounce
B. The entrepreneur’s personal assests 1064. Which of the following is not a disad-
have greater protection vantage to being a public company?
C. The entrepreneur still retains all prof- A. High establishment costs
its earned
B. Complex structure
D. The corporation has no need for using
C. More accountability
NARAYAN CHANGDER
debt capital
D. Unlimited liability
1060. This manager helps to create and com-
municate a positive image for the com- 1065. Which is one way to NOT develop lead-
pany. ership characteristics?
A. Human resources A. Participating in organizations and ac-
tivities.
B. Health services manager
B. Practicing leadership at work
C. Hotel manager
C. Observing leaders
D. Public relations manager
D. Flirting with coworkers
1061. What is NOT an example of a service
1066. Which of the following strategy could be
firm?
used to improve the KPI number of work-
A. Manufacturer place accidents
B. Education A. Initiating lean production
C. Landscaping B. Staff training
D. Accounting C. Cost cutting
D. Redeployment of resources
1062. Cate forgot her lunch and is feeling hun-
gry. Which level of needs (Maslow) is not 1067. Caitlin is doing a walk-through to be
being satisfied? sure that all the employees are on target
A. Self-Esteem to complete the company goals.
B. Social A. Leading
C. Safety B. Controllng
D. Physiological C. Planning
D. Organizing
1063. Which of the following IS NOT some-
thing you should do when naming a busi- 1068. Which of the following are advantages
ness? of investing in training? (Select all that
apply)
A. Keep it short, simple, and easy to re-
member. A. Improved motivation of employees
B. Search the internet to make sure the B. Improved ability of trained employees
name isn’t already trademarked or being C. Can be expensive
used. D. Productivity may be decreased when
C. Use a joke or pop culture reference they are away training
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 587
1069. Traditional method of stock control 1074. The ability of the society to develop in
which means holding a reserve of raw ma- such a way that it meets the social well-
terials and finished products in case of a being needs of the current and future gen-
PRACTICE BOOK» NOT FOR SALE
sudden increase in demand erations.
A. Just in time A. Social sustainability
B. Lean production B. Economic sustainability
C. TQM C. Ecological sustainability
D. Just in case D. Social entrepreneurship
1070. Using the Internet for telephone ser- 1075. Which type of customer relationship
vices. management software would be most ap-
A. VoIP propriate for a company that is looking
for a more efficient way to track leads,
B. WAN
prospects, and customers?
C. LAN
A. Personalization technology
D. data
B. Campaign management software
1071. How does brand promise affect employ- C. Sales force automation technology
ees?
D. Matching engine technology
A. It creates their job descriptions
B. It gives them a common goal. 1076. Which of the following is NOT an advan-
tage of ON the job training?
C. It increases their bonuses.
A. Employees are working while learning
D. It creates additional pressure on their
jobs. B. Training is tailored to the needs
C. Practice is able to be under supervi-
1072. Which of the following are not tech-
sion
nological developments to improve opera-
tions (from the study design) D. Less opportunity to be interrupted by
A. Computer Aided Design workplace issues
B. Computer Aided Manufacturing 1077. A procedure that evaluates the work
C. Website Development & accomplishment of an employee & pro-
vides feedback on performance.
D. Computer-integrated manufacturing
A. Contingency plan
E. Automated Production Lines
B. Performance review
1073. Physical resources are
C. Problem
A. employees of an organization
D. Management role
B. funds needed to operate the organiza-
tion 1078. Which management style/s would you
C. tangible items needed to run an orga- use to encourage two way communica-
nization tion? (select all that apply)
D. researched facts and figures that pro- A. Autocratic
vide information about an organization B. Consultative
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 588
C. Participative C. provide the customer.
D. Persuasive D. use as a trademark.
1079. What should you do to eliminate any 1084. Which of the following is an advantage
misunderstandings that you or your cus- of the matrix organizational structure:
tomer might have concerning the cus- A. It makes good use of organizational re-
tomer’s complaint? sources.
A. Thank the customer. B. It is inexpensive to implement.
NARAYAN CHANGDER
B. Take immediate action. C. It speeds up decision-making.
C. Explain company policy. D. It reduces the duplication of certain ac-
D. Restate the complaint. tivities.
1080. A computer system that processes data 1085. When a business is successful in carry-
into meaningful information is a(n) ing out its brand promise, it provides its
A. information system customers with?
B. search engine A. Above-average product quality.
C. WAN B. Consistent experiences.
D. LAN C. A variety of messages.
D. A single touch point.
1081. Which of the following is not a reason
why people may choose to set up their 1086. A logo is a brand’s
own business?
A. promise.
A. There is lack of employment opportuni-
B. identifying mark.
ties
C. personality.
B. There are higher risks than working
for someone else D. catchphrase.
C. To enjoy autonomy in decision-making 1087. The leadership style where the manager
D. To extend personal interests and hob- asks for input from employees but makes
bies the final decision
A. authoritarian
1082. A private business that maintains the
website of individuals and organizations B. delegating
on its web servers for a fee. C. democratic
A. web-hosting service D. superior
B. WAN
1088. Jacqui is bored, she thinks Business
C. management information system Management is too easy. Which level of
D. knowledge workers needs (Maslow) is not being satisfied?
1083. A business’s brand promise is what the A. Self-Esteem
business intends to: B. Social
A. name its product. C. Safety
B. sell to the target market. D. Self-Actualisation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 589
1089. Which of the following tend to be least C. following up with individuals
important to the success of lower level D. collaborating
management
PRACTICE BOOK» NOT FOR SALE
A. Decisions skills 1094. The assumes that the best approach
to leadership depends on the situation.
B. Human skills
A. Trait Theory
C. Conceptual skills
B. Contingency Approach
D. Technical skills
C. Path Theory
1090. Answering questions such as “do I want D. Leadership Goals
to help people? ” and “do I want to work
with my hands? ” can help you develop 1095. Which of the following is not a motiva-
which of the following? tional theory a business could use to im-
A. Employability skills prove staff motivation
B. Lifelong learning A. Goal Setting
C. Academic skills B. 4 Drive
D. Occupational goals C. Maslow
D. Career advancement
1091. Encik Roslan, the President of Company
XYZ, recognizes excellent and performing 1096. Leading
employees at an annual company dinner by
A. Keeping entire business on track
awarding each of them with a plaque and
a cheque for RM1, 000. Encik Roslan is en- B. Organizing plans
gaging in the management function of C. Giving orders and creating a vision
A. Planning D. Setting goals
B. Organizing
1097. Which statement is FALSE about CIOs?
C. Leading
A. CIOs protect information from being
D. Controlling improperly used?
1092. A company that wants its data to be B. CIOs do not need management skills.
organized in a way that makes the data C. CIOs must know what types of equip-
easy to find, update, and manage would ment to purchase to meet an organiza-
use a(n) tion’s needs.
A. Information system D. CIOs protect information from getting
B. Firewall to people who should not have it.
C. DDS 1098. A measure that precedes, anticipates, or
D. database predicts future performance.
1093. Which of the following is used in posi- A. Lagging indicator
tive internal business relationships? B. Predictive indicator
A. mentoring C. Leading Indicator
B. networking D. Performance indicator
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 590
1099. Situation when the management team C. Herzberg
and workers have representatives who ne- D. Adams
gotiate on the terms and conditions of em-
ployment. 1105. Lean Management is?
A. Lock-out A. A systemic process for eliminating
B. Slowdown waste in the manufacturing system
C. Strike B. A systemic process for clearing waste
in a range of systems
NARAYAN CHANGDER
D. Collective Bargaining
C. A range of processes for eliminating
1100. Which one is not a business objective (as waste in manufacturing
listed in the current study design)
D. Eliminating waste in the manufactur-
A. To make a profit ing system
B. To fulfil a social need
1106. When a hurricane interrupted a busi-
C. To fulfil an environmental need
ness’s new product development, the
D. To increase market share project team had a plan for getting things
back on track. This is an example of how
1101. Operating systems are made up of the
project management
following except
A. helps businesses evaluate feasibility.
A. People
B. Sales B. allows employees to adapt to risk.
C. Facilities C. requires a product champion.
D. Materials D. needs strong quality controls.
1102. The process that managers use to de- 1107. is a term that is used to refer to the
velop goals and objectives, as well as people who are in charge of running a busi-
strategies to achieve them, is called ness.
A. analysis A. Management
B. planning B. Principals
C. organizing C. Officers
D. strategic thinking D. Stakeholders
1103. Espirit de corps means 1108. Why is leadership an important aspect
A. Union is Strength of directing?
B. Service is our motto A. Leadership and directing include the
same activities and traits.
C. Buyer beware
B. Employees need less supervision
D. Product is our Strength
when managers demonstrate leadership.
1104. Whose theory was Hierarchy of C. Employees follow direction when they
needs? respect managers as leaders.
A. Taylor D. Leadership improves managers’ ability
B. Maslow to provide clear instructions.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 591
1109. Money needed to pay for the current op- 1114. Assume that the current currency ex-
erating activities of a business change rate for US Dollars and Euros is 1
US Dollar = .736 Euros. Brad is making
PRACTICE BOOK» NOT FOR SALE
A. start-up financing
a purchase in Germany that cost 25 Eu-
B. venture capital ros. How much will this cose him in US
C. short-term financing Dollars?
D. long-term financing A. $18.40
B. $25.74
1110. An effective mentor is a person who
C. $33.97
A. has mastered the skills and experience
D. $42.50
an employee needs
B. is a good friend of the employee 1115. Which of the following should not be an
objective of a company’s collection proce-
C. is external to the employee’s company
dure?
D. has been given salary raises in the A. Converting credit customers to cash
past customers
1111. Providing the conditions that stimulate B. Collecting the amount due
followers to act in a committed, concerned C. Maintaining the goodwill of customers
and involved way in doing their work.
D. Resolving collection problems as
A. Effectiveness quickly as possible
B. Emotional Intelligence (EI)
1116. the use of flexible computer-aided pro-
C. Efficiency duction systems to produce items to
D. Empowerment meet individual customer’s requirements
at mass-production cost levels
1112. refers to the general feeling in A. mass customisation
a business shaped by the psychological
B. flow production
states and attitudes of the people who
work there. C. batch production
A. Workplace Situation D. job production
B. Workplace Climate 1117. The degree to which workers are free
C. Work Environment from the direct influence of a supervisor
and can exercise discretion in scheduling
D. Company Image their work and in deciding how it will be
done.
1113. Describes the work an individual or
group of individuals is supposed to per- A. Discretionary Control
form B. Autonomy
A. Job Design C. Span of Control
B. Schedule D. Centralized Authority
C. Job Description
1118. Barriers that can inhibit successful plan-
D. Operations Managers ning are
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 592
A. company priorities and resources and counsel and when the authority for de-
B. company ownership ciding what to do is shared.
C. company mentality A. Control Role
B. Service Role
D. community support
C. Advisory (or Counseling) Role
1119. Every subordinate should receive orders
D. Change Agent Role
from and be accountable to only one supe-
rior is 1124. In the business world, HR stands for:
NARAYAN CHANGDER
A. Unity of direction. A. Home Run
B. Unity of command. B. Hero Rule
C. Centralization. C. Hunk Report
D. Scalar chain. D. Human Resources
1120. The management function of guiding em- 1125. Choose the statement that gives the
ployee actions toward achievement of a best advice about completing a job appli-
company’s goals is cation
A. controlling A. Use colorful ink, because it will make
your application stand out
B. organizing
B. Never answer questions about previ-
C. leading
ous law violations
D. planning
C. List previous employment beginning
1121. Rapid industrialization during the late with your most recent job
1800’s contributed to D. Inflate your previous salary level, as
A. decline in the membership in labor they may give you more money
unions 1126. Why do top-level managers usually re-
B. a reduction in government regulation ceive high salaries?
of railroads A. Their decisions affect the entire com-
C. an increase in immigration to the pany.
United States B. They are required to attend a great
D. a rise in the number of family farms many meetings.
C. They have more experience than oth-
1122. What is NOT an example of a proces-
ers in the company.
sor?
D. Their responsibilities involve hands-on
A. Wholesaler
supervision.
B. Oil refinery
1127. According to the presentation, oppor-
C. Textile Mill
tunities for which of the following areas
D. Cotton Mill are expected to increase in the next few
years?
1123. Exists when the relationship between
the human resource department and the A. Business information technology
line managers is one of providing advice B. Operations management
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 593
C. Human resources management 1133. Initiates change, such as innovations or
D. Administrative support new strategies, in the organization
PRACTICE BOOK» NOT FOR SALE
A. the entrepreneur,
1128. Which of the following is not a charac-
B. the disturbance handler,
teristic of persuasive management style?
C. the resource allocator,
A. Centralised system of control and au-
thority D. the negotiator
B. Communication is decentralised 1134. Who is most closely associated with
C. Money is a main motivator for work he theory of management that focuses on
performance identifying the most effective practices for
organizing and managing a business?
D. Communication is centralised
A. Deming
1129. Top Level Management B. Fayol
A. Warehouse supervisor C. Mayo
B. Setting goals for the future. D. Taylor
C. Employee 1135. Which is NOT an example of team learn-
D. Students ing?
A. Team meetings where employees take
1130. A report of a company’s income, ex- on roles in a project
penses, and profits over a certain period
of time. B. Teacher presenting to other teachers
how to use Google Docs
A. Balance Sheet
C. A soccer team discussing game strat-
B. Cash Flow Statement egy
C. Outlay Costs D. Employees each having to undertake
D. Income Statement an online OH & S course
1131. What should you do to determine 1136. When a leadership position is part of an
whether a customer’s complaint is justi- organization’s structure, the person hold-
fied? ing that position has influence.
A. formal
A. Restate the complaint
B. informal
B. Investigate the problem
C. expert
C. Take immediate action
D. identity
D. Ask a supervisor
1137. The amount a retailer pays to a supplier
1132. Henry Fayol laid down for goods it then resells is called the
A. 10 A. gross profit
B. 12 B. net profit
C. 13 C. current assets
D. 14 D. cost of goods sold
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 594
1138. The MSB Company provides its cus- 1143. A manger whose main job is to direct
tomers with critical or time-sensitive prod- the work of employees:
uct information by sending them alerts A. supervisor
or messages through their cellular phones.
What form of technology is MSB using as B. executive
an element of customer relationship man- C. worker
agement?
D. employee
A. Dial up
NARAYAN CHANGDER
B. Traditional 1144. An advantage of using a venture capital-
ist is
C. Global positioning
A. Shareholders benefit from limited lia-
D. Wireless
bility
1139. What level of management would a B. Saves on having to purchase expensive
Chief Financial Officer be in? equipment outright
A. Middle C. Organisations who have a poor credit
B. Top rating might be able to get finance
C. Lower D. none of above
D. Shallow
1145. functional specialists, data scientists,
1140. Knowledge workers are people who and business process manager are Po-
sitions?
A. program computers
B. answer questions for technology A. Business Analytics
users B. Office management
C. create websites C. general management
D. work with information D. HR management
1141. The fundamental guidelines for the deci- 1146. Parker is worried about losing his job.
sions and actions of managers Which level of needs (Maslow) is not be-
A. MIS ing satisfied?
B. Management Role A. Self-Esteem
C. Management Schedule B. Social
D. Management Principles C. Safety
1142. When a marketing manager goes on va- D. Self-Actualisation
cation, the marketing staff does not know
what tasks to do and does not feel like it 1147. To determine whether or not a company
can work ahead on anything. This exam- is a good loan risk, lenders often review
ple illustrates that its
A. directors must build group dynamics. A. tax returns
B. directing is a continuous process. B. financial ratios
C. directing is the starting point of action. C. capital budget
D. directing motivates employees. D. cash flow
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 595
1148. Which of the following statements is 1153. One of the hallmarks of a global econ-
TRUE about the relationship between data omy is , which occurs when nations
and information? combine to form a common market as a
PRACTICE BOOK» NOT FOR SALE
A. Data are used to create information. free trade area
B. The terms data and information are in- A. economic integration
terchangeable. B. economic dislocation
C. Information is broken down into data C. boundary readjustment
so that they can be processed.
D. fiscal redefinition
D. There is no relationship between data
and information. 1154. Department manager, small business
manager, and regional manager are po-
1149. The free enterprise system, which oper- sitions.
ates in a democracy, is called
A. general management
A. Capitalism
B. supply chain management
B. Communism
C. business analytics
C. Socialism
D. operations management
D. Free market
1155. Most businesses today are looking for
1150. In order to keep track of all the financial employees wh have at least basic
information that is useful to management, skills.
you will need a (n):
A. computer
A. accounting system
B. legal
B. document management system
C. management
C. HR person
D. accounting
D. IT person
1156. In this function, managers must bring to-
1151. A manager who helps an employee
gether the various resources to achieve ob-
count the money in a cash drawer and pre-
jectives. In manay businesses, many dif-
pare a bank deposit is demonstrating
ferent activities are going on so the man-
A. natural talent ager should
B. technical skills A. Plan
C. creativity B. Coordinate
D. aggressive behavior C. Organize
1152. What is something that a leader would D. Command
say?
1157. In China, the Shanghai Disney Resort is
A. “you better get it right next time!” owned 47% by the Walt Disney Company
B. “Don’t mind. We will get it next time.” with the Chinese government owning the
C. “Where is all that work you did? What remaining 53% majority stake
do you have to show for? ” A. PPP
D. “Is this all you can do? ” B. PLC
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 596
C. Private Limited Companies 1163. Which of the following is a cultural fac-
tor affecting job opportunities?
D. Companies Corporations
A. Population growth
1158. Management is
B. Changing labor laws
A. an art. C. Increased diversity
B. a science. D. Artificial intelligence
C. an art and a science.
NARAYAN CHANGDER
1164. Just one person would likely be respon-
D. an art not science sible for all of the management functions
in a
1159. Brand promise helps to increase brand
awareness and brand A. new small business
A. loyalty B. partnership
C. large corporation
B. personality.
D. multinational company
C. character
D. value. 1165. The main strategies associated with Ma-
terials Management include
1160. Section three of a business plan de- A. JIT, MPS, MRP, Analysing
scribes which of the following?
B. JIT, TQM, Quality Control, Quality As-
A. Financial plan surance
B. Organization and marketing plan C. JIT, MRP, MSP, Analysing
C. Business description and analysis D. Forecasting, MRP, JIT, MPS
D. Promotional activities
1166. Which of the following statements
1161. A is when employees refuse to work about the role of managers is true?
any more than their contracted hours. A. Managers are responsible for the suc-
cess or failure of the company.
A. Strike
B. Managers make up the greatest per-
B. Lock-out
centage of employees in a business.
C. Overtime ban
C. Managers are responsible for complet-
D. Work-to-rule ing the day-to-day work of a business.
D. Managers spend most of their time
1162. The social values that are shared among
planning for the future.
the members of an organization and tend
to regulate their individual behaviors and 1167. Process of controlling and making deci-
induce collective conformity. sions about an organization
A. Shared Norms A. Leading
B. Cultural Values B. Managerial Roles
C. Code of Ethics C. Controlling
D. Cultural Artifacts D. Management
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 597
1168. This type of termination involves an em- C. Code of Ethics
ployee making the decision to leave the D. Cultural Values
paid workforce.
PRACTICE BOOK» NOT FOR SALE
A. Resignation 1173. To make a profit, a business’s revenue
has to be its costs.
B. Retirement
A. less than
C. Dismissal
B. more than
D. Redundancy
C. the same as
1169. Maslow’s hierarchy of needs states that D. equal to
1174. How many hours does full time usually
A. If something is not satisfied then they
work per week?
can still move onto the next level
A. 25 hours
B. You must start at the top of the pyra-
mid and work your way down B. 30 hours
C. Each level must be satisfied before C. 38 hours
someone can progress to the next level D. 10 hours
D. If you do not feel satisfied with your
1175. The general term that is applied to
self esteem there is no way of progress-
a computer that becomes inadequate be-
ing
cause a more efficient model comes on the
1170. Legally binding minimum requirements market is
for wages and conditions that apply to spe- A. depreciation
cific industries are called? B. obsolescence
A. Contracts C. replacement value
B. Wage orders D. asset book value
C. Awards
1176. Stu started a new job and feels like
D. Agreements he doesn’t fit in. Which level of needs
(Maslow) is not being satisfied?
1171. A person who is skilled at perform-
ing calculations, has math skills for ad- A. Self-Esteem
vanced analysis, and has organizational B. Social
skills would be best suited to work as
C. Safety
A. a credit analyst.
D. Self-Actualisation
B. a sales manager.
1177. A is usually a group of volunteers
C. an advertising manager.
who meet to discuss ways of improving
D. an administrative assistant. quality.
1172. The systems by which an organization A. Total quality management
is administered, directed and controlled. B. Quality assurance
A. Corporate Governance C. Quality circle
B. Core Competency D. Benchmarking
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 598
1178. Net worth, owner’s equity & stockhold- C. Identify tasks
ers’ equity are all terms meaning
D. Evaluate progress
A. capital
B. liabilities 1184. Which of the following statements
about directing is true:
C. assets
A. Directing is considered the “heart” of
D. inventory management.
1179. Procedure is
NARAYAN CHANGDER
B. Some employees do not need direc-
A. a set of rules tion.
B. a series of actions to enable the policy C. Staffing is more important than direct-
to be put in practice ing.
C. the same as the policy D. Only top-level managers participate in
D. none of above directing.
1180. What are business people who fail to 1185. Every business begins with a(n)
adapt their communication styles to appeal A. idea
to their international clients likely to do?
B. customer
A. Offend the clients
C. invention
B. Earn the clients’ trust
D. profit
C. Impress the clients
D. Persuade the clients to buy 1186. Salespeople who are well informed
about the brands, sizes, and styles of
1181. produces goods and services for the goods that the business offers can easily
market, but operates with the primary ob- answer which of the following customer
jective of fulfilling a social need. questions?
A. Sole Trader
A. What merchandise is carried by the
B. Social Enterprise business?
C. Government Business Enterprise B. What is the business’s return policy?
D. Partnership C. What type of credit does the business
1182. The most popular Management think of offer?
modern time is D. What hours is the business open?
A. Mary Parkett
1187. Documents identifying the tasks to be
B. Lillian Gilberth done, employees assigned to the work,
C. Peter Drucker and the time frame for completion of each
D. Elton Mayo task
A. Performance Reviews
1183. What is the first step in the managerial
planning process? B. Work Schedules
A. Establish goals C. Feedback Sheets
B. Create a schedule D. Work units
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 599
1188. An important reason for having busi- C. Organic and inorganic
ness policies is that policies: D. Chronological and reverse chronologi-
cal
PRACTICE BOOK» NOT FOR SALE
A. are the responsibility of management.
B. help employees to make consistent de- 1193. Which of the following is a function of
cisions. project management software:
C. provide employees with satisfaction. A. Financial calculations
D. even out the workload for employees. B. Scheduling
C. Storing client information
1189. This person manages day-to-day activ-
ities on a farm, ranch, nursery or green- D. Creating visuals
house. Their responsibilities vary widely 1194. A plan showing projected sales, costs,
but focus on the business aspects of run- expenses, and profits for the ongoing op-
ning the agricultural establishment. erations of a business.
A. Funeral Director A. operating budget
B. education administrator B. cash budget
C. Farm operator and manager C. sales budget
D. human resources D. capital budget
1190. which of these is a leader? 1195. Rhys is a manager who wants to bet-
ter motivate and communicate with his
A. Twitter Famous person that only does employees. Which management function
things to gain attention should he focus on to achieve this goal?
B. A soccer captain that only bosses his A. Directing
teammates aroun
B. Planning
C. A basketball player that works hard on
C. Organizing
their own and also tries to improve their
teammates D. Controlling
D. A political critique that always has to 1196. How much time should you allocate to
put someone down each mark in the exam? (hint:75 marks
and you have 2 hours)
1191. When a new business first begins to or-
A. 1 minute 36 seconds
ganize activities into units, it should
B. 1 minute 05 seconds
A. create many small units
C. 2 minute 25 seconds
B. group activities into a few natural divi-
D. 3 minute 36 seconds
sions
C. put all activities into one large unit 1197. Goals should be stated in broad, non-
specific language to make them easier to
D. prepare unit work schedules reach.
1192. What are the two most common man- A. True
agement structures? B. False
A. Vertical and horizontal C. All of the above
B. Alphabetical and numerical D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 600
1198. Evaluating results to determine if the 1203. Which of these people is responsible for
company’s objectives have been accom- creating the Classical-Scientific Approach
plished as planned: A. Wolfgang Daniels
A. controlling B. Henry Ford
B. planning C. Elton Paige
C. organizing D. Max Weber
D. leading
NARAYAN CHANGDER
1204. Businesses that generate more than
$75, 000 in income annually MUST regis-
1199. What term refers to people that are re-
ter for this.
sponsible for running a business?
A. ACN
A. Stockholders
B. PAYG
B. Officers
C. GST
C. Management
D. BAS
D. none of above
1205. In the modern business world, a grow-
1200. When a manager measures how the ing number of interactions between busi-
business performs financially, he or she is nesses and customers are taking place
said to be performing the task of
A. over the phone.
A. controlling B. online.
B. organizing C. in stores.
C. leading D. through the mail.
D. planning
1206. are units of ownership interest in a
1201. Name the function of management that corporation or financial asset that provide
involves monitoring how the business is for an equal distribution in any profits.
performing. A. Dividends
A. Leading B. Shares
B. Controlling C. Revenue
C. Planning D. Taxes
D. Organizing 1207. People who work with information.
A. knowledge workers
1202. What is the term production managers
use for assigning job to a factory or de- B. web-hosting service
partment C. WAN
A. Loading D. LAN
B. Scheduling
1208. When is it not legal for a business to
C. Dispatching refuse a refund? (Select all that apply)
D. none of above A. When the item is faulty
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 601
B. When the item does not match the 1213. A method of lean production based on
sample continuous improvement
PRACTICE BOOK» NOT FOR SALE
C. When the customer has changed their A. Kaizen
mind
B. JIC
D. When the customer has been hurt by
the item C. Kanban
D. Kaizen
1209. In the past, customer relationship man-
agement was used mainly as a way to 1214. A difficult situation requiring a solution
A. increase customer loyalty. is
B. assist business decision making. A. a problem
C. track customer information. B. a symptom
D. help employees perform more effi- C. a standard
ciently.
D. an alternative
1210. If an employee regularly receives in-
structions from more than one manager, 1215. Which career professional would be con-
there is a problem sidered part of the Human Resources path-
way of the Business, Management, and
A. span of control Administration career cluster?
B. unity of command
A. Labor Relations Specialist
C. policies and procedures
B. Data Entry Keyer
D. the employee
C. Compliance Manager
1211. At a hair salon, one employee washes D. Management Analyst
customers’ hair, another employee cuts it,
and another dries and styles it. This al- 1216. By accurately explaining the company’s
lows the employees to make the most ef- policies to customers, salespeople often
ficient use of their time and illustrates an are able to avoid misunderstandings with
organizational principle known as customers and improve the company’s:
A. span of control A. goals.
B. division of labor B. routine.
C. authority
C. image.
D. innovation
D. rules.
1212. Which answer is incorrect? A feature of
an autocratic management style is 1217. Which of the following is an example of
negative reinforcement:
A. Decisions are explained to employees
A. A raise
B. Little trust is placed in employees
B. A bonus
C. It is centralised decision making
C. Reduced tedious paperwork
D. Communication is one way (down-
wards) D. Additional vacation time
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 602
1218. Which of the following is an example of 1223. What type of power is granted to man-
motivation as a means of directing: agers by employees because the employ-
A. A manager pays attention to what time ees determine the managers are worthy
employees clock in. of it?
B. Employees engage in team-building ex- A. expert and identity
ercises. B. expert and power
C. Andy’s boss asks him to stay an hour C. power and position
NARAYAN CHANGDER
late to finish his project. D. identity and position
D. Emmie praises her employees for qual-
1224. The federal agency that helps small busi-
ity work.
ness owners obtain financing and other
1219. How does governmental use of revenue support is known as
from sales and corporate taxes benefit A. OSHA
businesses? B. Chamber of Commerce
A. Tax monies pay off government debt. C. Small Business Administration
B. Tax monies provide foreign aid. D. Proprietorship
C. Tax monies fund public services.
1225. When choosing a location for a business,
D. Tax monies fund military projects. the most important factor managers con-
sider is
1220. Samantha is conducting interviews with
potential employees to find a replacement A. Wage Rate
for a worker who retired. Which manage- B. Climate
ment function is this?
C. Community attitudes
A. controlling
D. Availability of natural resources
B. planning
1226. Fred the football coach must meet
C. leading with the media and answer questions
D. organizing about team performance after every game.
Which one of Mintzberg’s managerial roles
1221. Whats it called when a leader can influ- is Fred fulfilling?
ence your wage?
A. Speaker
A. Bad influence
B. Spokesperson
B. Salary Influence
C. Disseminator
C. Position Influence
D. Monitor
D. Monetary Influence
1227. When a management team takes into ac-
1222. involving a high quantity of capital count the opinions of the team members
equipment compared with about input before making a decision, it is called?
A. effectiveness A. Persuasive management style
B. efficiency B. Centralised decision-making
C. labor intensive C. Aurocrartic management style
D. capital intensive D. Consultative management style
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 603
1228. The main difference between customer 1233. Strategies are
relationship management and customer ex- A. Strategies are the tasks taken to
perience management is that CRM focuses
PRACTICE BOOK» NOT FOR SALE
achieve an objective.
on
B. Strategies are the tasks taken to
A. the business itself. achieve the plan.
B. customers. C. Strategies are the tasks taken to
C. product development. achieve happy relationships.
D. investors. D. none of above
1229. The processes and activities needed to 1234. Creating a list of responsibilities for the
produce goods and services assistant manager for closing down the
A. Continuous Flow restaurant at night
B. Physical Arrangement A. Planning
C. Activity Scheduling B. Organizing
D. Operating System C. Leading
D. Controlling
1230. The shape of the management pyramid
helps illustrate 1235. Employees in the administration support
A. the number of and relationship among pathway perform a variety of tasks
the levels of management for businesses and organizations.
B. the time allotted to various manage- A. math
ment function B. desk
C. the reporting structure within an orga- C. difficult
nization D. clerical
D. all of the above
1236. Edward has worked at ‘RCH Records’
1231. When a handbag company embroiders a for 2 years. He is wanting to quit his job
customer’s name or monogram on a cloth and move to another company, How much
tote bag, it is processing a(n) time/notice would he be required to give
A. open requisition to his current workplace?
B. blanket requisition A. 1 week
C. special order B. 3 weeks
D. reorder C. No notice
D. 2 weeks
1232. Which of these elements of business are
interdependent with each other 1237. The number of different skills a worker
A. Human Resources / Operations needs to perform a job is referred to as
B. Operations / Marketing A. Job Skills
C. Operation / Finance B. Qualifications
D. Operations / Finance / Marketing / C. Skill Variety
Human Resources D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 604
1238. Assigning aisles and stocking protocols 1242. Name that concept:refers to the signifi-
to stockers in the grocery department cant long-term planning decisions that or-
ganizations make in order to meet the
A. Planning
needs and wants of their stakeholders.
B. Organizing
A. Globalization
C. Leading
B. Strategy
D. Controlling
C. Ethics
NARAYAN CHANGDER
1239. Which best describes the Business, Man- D. Change
agement, and Administration career clus-
ter? 1243. The two key components that need to be
recognised while initially forecasting are:
A. These are careers that are focused on
running businesses. A. Buyer lead-time time & price increases
B. These are careers that combine medi- B. Production time & demand changes
cal services, coding, and sales. C. Employee motivation & supplier lead-
C. These are careers that report informa- in time
tion to the public. D. Supplier lead-time time & price
D. These are careers that provide care changes
for those who are unable to care for them-
1244. Which of the following is NOT an advan-
selves.
tage of automation?
1240. Which management function is de- A. Increased productivity speed
scribed in the following situation:Wendell
B. Greater precision
has created a team atmosphere among the
members of his sales department. When C. High initial set up costs
the team exceeded their monthly sales
D. More efficient use of time
goal, James rewarded them with a celebra-
tory dinner out and a five-percentbonus. 1245. Where do entrepreneurs go for profes-
A. Directing sional advise
B. Controlling A. Mentors
C. Planning B. SBA
D. Organizing C. SCORE
D. All of the above
1241. In which of the following strategic plan-
ning steps would a team approach be de- 1246. h quarter sales will increase by 10%
veloped? due to our new sales campaign
A. engaging employees A. Planning
B. communicating B. Organizing
C. implementing plan in phases C. Leading
D. overcoming resistance D. Controlling
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 605
1247. directed at organizational improvement A. Supply chain management
through understanding employee motiva-
B. Human resources management
tion and behavior
PRACTICE BOOK» NOT FOR SALE
C. Operations management
A. classical management
B. administrative management D. Business analytics
C. behavioral management 1253. Which of the following is the traditional
D. quality managment management structure?
1248. Having the ambition and motivation to A. Horizontal
get work done without being asked is B. Pyramid
known as
C. Expansive
A. leadership
D. Vertical
B. dependability
C. organized 1254. A manager worked to streamline the
D. initiative production process and was able to save
the company several thousands of dollars.
1249. The way people get along with each This is an example of how organizing
other is called A. reduces waste and improves efficiency
A. management style
B. unites company goals with the mis-
B. human relations sion.
C. leadership C. increases employee conflict and
D. controlling turnover.
1250. Pollution can, in part, be controlled D. can be improved through communica-
through tion.
A. Recycling 1255. There are 3 key stakeholders in Aus-
B. EPA regulations tralian workplace relations. Which of the
following is NOT one?
C. Following the sustainability principles
D. All of these A. Employees and trade unions
B. Government
1251. Ways to increase productivity
C. Employers
A. motivate the workers
B. hire a manager D. Suppliers
C. use more advanced technology 1256. A plan that describes expected income
D. train the workers and expenses over a period of time.
1252. Many business management and admin- A. Cash Flow Statement
istration (BMA) careers involve dealing B. Business Plan
with employees, customers, or vendors,
C. Budget
but which type of BMA career is all about
people? D. Balance Sheet
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 606
1257. Which management function involves 1262. Someone who gives professional advice
analyzing information, setting goals, and or offers professional services is called
making decisions about what needs to be a(n)
done? A. auditor
A. controlling
B. certified public accountant
B. organizing
C. investment banker
C. planning
D. consultant
NARAYAN CHANGDER
D. implementing
1263. The five P’s of Entrepreneurship are
1258. Unlimited liability is defined as?
A. Purpose, Passion, Presence, People
A. When the owner has no liability be-
Profit
cause the business is owned by another
individual/company B. People, Profit, Passion, Planning, Pur-
pose
B. When the owner has somewhat liabil-
ity C. People, Profit, Purpose, Passion, Per-
sistence
C. When two individuals agree on their
company’s liability being shared between D. Profit, Passion, Purpose, Possessions,
them Persistence
D. When the owner has full liability to the 1264. How does solving difficult-customer sit-
extent of their personal assets uations benefit your company?
1259. Money provided by large investors to A. It will generate repeat business.
finance new products and new businesses
B. The difficult customers won’t bother
A. start-up financing you again.
B. venture capital C. You will get a promotion.
C. short-term financing D. All the employees will get promotions.
D. long-term financing
1265. Which of the following is not an advan-
1260. Which of the following would not be a tage of global outsourcing?
operating environment stakeholder?
A. Skills that cannot be found in the home
A. Employees nation can be tapped
B. Customers B. Jobs and economic opportunity can be
C. Trade Union provided to low economic areas
D. Creditors/banks C. Opportunity to take advantage of
global efficiencies
1261. A group of employees meets everyday
at lunch to chat about what’s going on in D. Opportunity for individuals of the home
the office. This is an example of land to be promoted above particular jobs
A. outside communication 1266. The task word “Apply” means
B. informal communication A. Provide an explanation using exam-
C. vertical communication ples
D. external communication B. Briefly explain the concept
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 607
C. Provide a definition 1271. The desire for friendships, relationships
D. Explain how the concept can be used and personal connection is known as which
drive?
PRACTICE BOOK» NOT FOR SALE
in a specific business
A. Drive to Acquire
1267. An industrial action in which employees
do no more than the minimum required B. Drive to Bond
by the rules of their contract, and pre- C. Drive to Learn
cisely follow all safety or other regula-
D. Drive to Defend
tions, which may cause a slowdown or
decrease in productivity, as they are no
1272. A systematic way to explore the conse-
longer working during breaks or during un-
quences of specific choices using computer
paid extended hours
software
A. Go slow/slow downs
A. Solution Resolution
B. Work-to-rule
B. What-If Analysis
C. Lock-out
C. Symptom
D. Strike
D. Management Information System
1268. Making decisions based on factual infor-
mation and logical reasoning is called 1273. Interviewing applicants and training
new employees are part of a manager’s
A. Brainstorming daily activities.
B. Intuition A. staffing
C. Rational B. hierarchy
D. Risking
C. communicate
1269. Which of the following are characteris- D. sensitivity
tics of a service business? (select all that
apply) 1274. Which stage of production does opera-
tions management apply to?
A. Create tangible products
B. Can be stored A. Primary
C. Lots of customer input B. Secondary
D. Production and consumption generally C. Tertiary
occur at the same time D. All of them
E. Little customer involvement
1275. Which of the following types of informa-
1270. The ‘Classical-Scientific Management tion does a company need customer input
Approach’ focuses on: to obtain:
A. Involvement A. Dates of store visits
B. Efficiency B. Suggestions for new products
C. Motivation C. Types of products purchased
D. Staff Connection D. Amount of money spent
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 608
1276. A disadvantage of flow production B. Reducing opening hours
A. high unit production costs C. Increased investment in technology
B. high levels of stocks at each produc- D. Cost cutting
tion stage
1282. Products that come in from another
C. expensive to set up flow-line machin-
country.
ery
A. Import
D. wide range of tolls needed
NARAYAN CHANGDER
B. Export
1277. Jon is always telling Petra what to do,
C. Trade
but Petra doesn’t know whether or not
Jon is her superior. Petra’s company needs D. Domestic
A. to implement the scalar principle. 1283. Which visual tool reveals customer per-
B. to adopt division of labor. ceptions of a product or a brand in relation
to others in the market?
C. to use a divisional structure.
A. Ansoff Matrix
D. to evaluate the results of organizing.
B. Product Life Cycle
1278. Brent is working with a new employee
to assist the employee in ways to manage C. BCG Matrix
her time better. D. Product Position Map
A. Leading 1284. Someone who is subject to the authority
B. Planning and control of another person
C. Organizing A. Supervisor
D. Controlling B. Subordinate
1279. The Era of Scientific Management is C. Manager
A. 1880-1930 D. Employee
B. 1880-1931 1285. Who would be best suited to analyze
C. 1880-1932 budgets, create reports, explain informa-
tion to others, and handle internal com-
D. 18880-1933
pany procedures and finances?
1280. Which of the following is a characteris- A. Receptionist
tic of qualitative research?
B. Marketing Agent
A. The researcher is not a part of the pro-
C. Manager
cess
D. Business Analyst
B. Key questions focus on ‘How many? ’
C. It is objective 1286. To be effective, goals must be
D. Key questions focus on ‘Why? ’ A. general
1281. Which is NOT a management strategy B. achievable
to respond to KPIs? C. independent from each other
A. Staff training D. all of the responses
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 609
1287. transfers and applies existing forms 1292. is an incorporated business with a
of thinking and problem-solving to new minimum of two, and a maximum of 50
scenarios. private Shareholders.
PRACTICE BOOK» NOT FOR SALE
A. Adaptive creativity A. Public company
B. Innovative creativity B. Private limited company
C. Process innovation C. Partnership
D. Positioning innovation D. Social Enterprise
1288. Customer relationship management can 1293. The process of collecting HR metrics and
help a business to identify its presenting them to managers in a useful
format. Sometimes referred to as an HR
A. best-selling products. scorecard.
B. most talented employees. A. HR Metrics
C. financial strengths and weaknesses. B. HR Scorecard
D. most valuable customers. C. HR Dashboard
1289. How many stages are their in Locke and D. HR Competencies
Latham’s goal setting cycle?
1294. Which style is often most appropriate
A. 2 when decisions need to be made quickly?
B. 3 A. Autocratic
C. 4 B. Consultative
D. 5 C. Participative
D. Laissez-faire
1290. Termination of an employee where
there is no longer sufficient work for them 1295. Which of the following is a function of
to perform is called? knowledge mapping software
A. Redundancy A. Querying data to retrieve information
B. Retrenchment B. Locating the person with the most
C. Being fired knowledge on a particular subject
D. Termination C. Preventing former employees from ac-
cessing company knowledge
1291. A human resource accounting measure D. Seeing who is responsible for a task
that represents the costs of recruiting, se-
lecting, and training the present employ- 1296. Middle Level Management
ees.
A. Carries out decisions from top level
A. Outlay Cost management.
B. Human Resource Accounting B. Also known as the CEO or President
C. HR Metrics C. Responsible for day to day activities.
D. Core Competency D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 610
1297. What can cause changes in industrial 1302. When a business communicates
markets? customer-centric values and ideals to its
employees on a consistent basis, it is de-
A. Consumer behavior
veloping its
B. Colorful behavior A. corporate culture.
C. Cooperative behavior B. organizational structure.
D. none of above C. technology.
NARAYAN CHANGDER
D. trademarks.
1298. Which financial ratio shows whether a
firm can meet its current debts comfort- 1303. is an extension of subcontracting,
ably? however, it involves using a business out-
A. return on sales side the home country.
A. outsourcing
B. inventory turnover
B. relocating
C. current ratio
C. locating
D. return on investment
D. offshoring
1299. Change in a business can have an impact 1304. This management function includes set-
on stakeholders ting standards for work, evaluating per-
A. No formances and solving problems that pre-
vent certain task from being completed.
B. Some
A. planning
C. Many
B. organizing
D. All C. leading
1300. Type of influence one has because oth- D. controlling
ers think he/she has their best interests
1305. This process deals with the ongoing
in mind.
process of setting performance standards,
A. identity influence measuring them, and comparing them for
future goals.
B. reward influence
A. Controlling
C. expert influence
B. Organizing
D. position influence
C. Directing
1301. Which of the following KPI’s would the D. Planning
strategy of “change in management style”
1306. An analysis that examines the political,
be appropriate to respond to (select all
economic, social, and technological factors
that apply)
in an organization’s environment.
A. Level of staff turnover
A. Competitor Analysis
B. Rate of staff absenteeism B. Regression Analysis
C. Percentage of Market Share C. SWOT Analysis
D. Rate of Productivity Growth D. PEST Analysis
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 611
1307. Examples of top level managers include B. Organizational communication studies
all the following except C. Accounting
PRACTICE BOOK» NOT FOR SALE
A. CEO (Chief Executive officer) D. Personal administration
B. CFO (Chief Financial Officer)
1313. Which of these programs is a screen-
C. President oriented interactive program which en-
D. All of them are top level managers ables a user to lay out data on screen?
1308. In which Career Cluster are librarians A. Kspread
classified? B. Prezi Pro
A. Business Management & Administra- C. Lotus Notes
tion D. Microsoft PowePoint
B. Information Technology
1314. Controlling, leading, organizing, and
C. Education and Training planning are the four of management
D. Hospitality and Tourism A. characteristics
1309. The driving force of business, provided B. cornerstones
by risk-taking individuals which combines C. functions
the other factors of production is called
D. objectives
A. Land
1315. Planning
B. Labor
A. Planning special events for staff
C. Capital
B. Giving orders to others
D. Enterprise
C. Carry out decisions of top level
1310. Analyzing information and making deci-
D. Setting company goals.
sions about what needs to be done is the
management function known as 1316. Businesses should review performance
A. planning and change in a number of levelsSelect the
following that are relevant
B. organizing
A. Whole business
C. leading
B. Departments
D. controlling
C. Teams
1311. A basic truth or law D. Individual employees
A. professional managers
1317. The careful, objective study of manage-
B. management ment decisions and procedures in order to
C. glass ceiling improve the operation of businesses and
D. principle organizations
A. Management Science
1312. Which of the following is NOT a sug-
gested major for human resources man- B. Study of Management
agers? C. Management Behavior
A. Labor relations D. Management Strategy
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 612
1318. Most departments plan and pro- 1323. Which management function is de-
vide regular safety training, place posters scribed in the following situation:Christy
and materials in the workplace to remind Chen determines the type of workers she
workers to follow safety procedures, and needs, locates qualified applicants, selects
monitor work to identify and correct pos- those to be hired, and assigns the new
sible safety problems. hires to a work area
A. Manufacturing A. Directing
B. Planning B. Controlling
NARAYAN CHANGDER
C. Health C. Staffing
D. Human Resources D. Planning
1319. Using past data and trends to predict fu- 1324. Where does Marketing Occur?
ture demand A. Everyday by people, in places, with
A. Just in Time communication
B. Forecasting B. Marketing occurs wherever customers
are located
C. Automated Production Line
C. both of them
D. Microsoft Excel Skills
D. none of above
1320. The goods that a business has in stock
to sell are called 1325. What technological advancement has
made project management software acces-
A. extra
sible no matter where employees are lo-
B. products cated?
C. services A. Cloud computing
D. inventory B. Augmented reality
1321. What are supervisors and managers not C. Automation
usually responsible for in a company? D. Radio frequency identification
A. performing actual jobs in departments
1326. A widely used financial tool is
B. upholding the mission statement of the
A. policy
company
B. standard
C. providing guidance to employees
C. budget
D. none of above
D. goal
1322. New information not yet included in a
management information system can be 1327. Market research is
gathered by A. is the process of developing new prod-
A. conducting research ucts for the market by creating prototypes
and experimenting.
B. asking what-if questions
B. the process of collecting, analyzing
C. reviewing company records and reporting data related to a particular
D. asking employees market.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 613
C. used to provide current or latest infor- 1333. Which of the following would be the
mation regarding activity in the market. most likely cause of customer complaints?
PRACTICE BOOK» NOT FOR SALE
D. all of the above. A. Institutional ads
1328. Which career professional is not part of B. Product quality
the Business, Management, and Adminis- C. Extended hours
tration career cluster?
D. Price reductions
A. Human Resources Director
1334. In comparison to large businesses, small
B. Assistant to the Chief Executive Officer
businesses
C. Business Accountant
A. can usually charge lower prices
D. Mathematics Instructor
B. can provide more personalized cus-
1329. Business Management can be done tomer service
A. by anyone C. focus on products that meet the needs
B. anyone who qualifies of a large group
C. your mom D. have less frequent contact with their
customers
D. you
1335. Which age group is projected to increase
1330. Satisfaction or Service Quality Gaps oc- in the workforce by the greatest percent
cur when the customer’s of service and between 2010 and 2050?
are not aligned.
A. 16-24
A. perceptions, expectation
B. 25-40
B. ideals, actions
C. 41-54
C. perception, desires
D. 55 and over
D. expectations, desires
1331. Which category of roles does Sara the 1336. To plan successfully, managers need to
store manager use when she makes up the A. communicate unilaterally
weekly schedule for her employees? B. communicate effectively and solicit in-
A. Liaison volvement from others
B. Decisional C. communicate with other managers
C. Interpersonal D. write the plan down
D. Informational
1337. An information system that integrates
1332. innovation refers to the use or per- data from various departments to make
ception of a new product where it sits it available to help managers with day-to-
in the market and how it is perceived. day business operations is called a(n)
A. Product A. DSS system
B. Process B. ISP system
C. Positioning C. EIS system
D. Adaptive creativity D. MIS system
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 614
1338. CAM is closely recognized by the use of C. Corporation
A. Engineering designs D. Vendor
B. Computer simulation
1344. Mediation
C. Robots
A. helps disputing parties make a deci-
D. Production Planning sion
1339. Each of the following is a main section B. independent 3rd party helps facilitate
NARAYAN CHANGDER
of a business plan except conversation
A. Customer Analysis C. makes suggestions on how to resolve
B. Employee Responsibilities a dispute
C. Marketing Plan D. independent 3rd party offer advice to
D. Description of the Business disputing parties
1340. Which of the following is considered a 1345. A limitation of random sampling method
pre-sale touch point: is:
A. Advertising A. Data is likely to be skewed depending
upon who is interviewed.Note
B. Interaction with a salesperson
C. Shipping/Delivery B. More time-consuming than other meth-
ods.
D. Installation
C. There is no guarantee the sample will
1341. Which business strategy am I? Con- be representative.
cerned with stability and possible retrench-
D. none of above
ment. Seeks to retain current customers
without having to innovate or grow.
1346. Income minus costs
A. Reactor
A. profit
B. Differentiation
B. credit
C. Defender
C. motivation
D. Prospector
D. operations
1342. Actions and behaviors managers are ex-
pected to perform in an organization 1347. when managers are grouping related
A. Management tasks into departments or teams, they are
B. Planning
A. instructing employees about how to
C. Leading
spend their time
D. Managerial Roles
B. allocating the company’s resources
1343. A person or business that sells some- C. determining the organizational struc-
thing. ture
A. Limited liability company D. analyzing the external business envi-
B. Manufacturer ronment
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 615
1348. Which is one of Senges principles? 1353. People who start and run their own
A. Team learning business
PRACTICE BOOK» NOT FOR SALE
A. management
B. Team development
B. entrepreneurs
C. Team work
C. principle
D. Team building
D. professional managers
1349. Why should businesses pay for non-
compulsory insurances? 1354. The selling price is the amount of money
that a buyer pays and the seller for a
A. To write off the expense good or service.
B. To protect financial and non-financial A. earns
assets from potential loss or damage
B. loses
C. To ensure that they are protected
against negligence C. finds
D. To stop anyone making a claim against D. receives
them 1355. A multinational company would like to
establish a factory in a new country. It
1350. What are the 3 different types of lead-
does not have the resources to research
ers according to Lewin, Lippit and White?
the entire population of the country. What
A. Autocratic, Democratic and Laissez- is the most appropriate form of sampling
faire it should carry out?
B. Autocratic, Leadership and Motivation A. Cluster
C. Democratic, Laissez-faire and Achieve- B. Convenience
ment
C. Snowballing
D. none of above
D. Quota
1351. Plans that are concerned with shorter 1356. Which of the following types of man-
time frames and lower level units are agers tends to focus on the organization
called as a whole and are concerned mainly with
A. practical long-term planning?
B. tactical A. Lower level managers
C. contingency B. Middle level managers
D. strategic C. Top level managers
D. First line managers
1352. Setting the company objectives for the
coming year is an example of which busi- 1357. Which of the following is an example of
ness management function? a brick and mortar store?
A. Controlling A. Foot Locker
B. Leading B. Amazon
C. Organizing C. Zappos
D. Planning D. Nike.com
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 616
1358. may happen when a business no 1363. Commercial trade between nations
longer has any work for an employee, through free market principles without
caused by factors such as a recession or regulation
relocation of the business. A. Export
A. Dismissal
B. Fair trade
B. Termination
C. Import
C. Retirement
D. Free trade
NARAYAN CHANGDER
D. Redundancy
1364. Which of the following is an example of
1359. The number of shares of stock to be is- a post-sale touch point:
sued by a corporation is determined by
A. The product itself
A. Common stockholders
B. Customer loyalty program
B. Preferred stockholders
C. Advertising
C. Company executives
D. Publicity
D. The board of directors
1365. Managers allow employees a great deal
1360. Brand promise connects to customers on
of control over their own work and do not
a(n) level.
supervise them closely if the managers be-
A. intellectual lieve that employees
B. social A. enjoy their work
C. logical B. dislike their work
D. emotional C. are having personal problems
1361. What type of utility exists when a food D. understand their work
processor converts peanuts to peanut but-
ter? 1366. How does organizing provide a sense of
security for employees?
A. Possession
A. They know exactly what is expected of
B. Time them
C. Place B. They do not have to duplicate work.
D. Form C. They know how their work supports
1362. Which of the following is a true state- company goals.
ment regarding a project champion: D. They do not have to report to anyone.
A. S/He is closely involved in the work of
1367. What must managers be able to do if
the project.
they want employees to understand the
B. S/He is the same person as the project business’s goals and be productive?
manager.
A. Listen carefully
C. S/He can mobilize the necessary re-
B. Communicate clearly
sources to get the project done.
D. S/He is usually a low-ranking em- C. Ask questions
ployee in the business. D. Obtain feedback
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 617
1368. Which secondary market research 1373. What management function involves
method is not considered a good source identifying qualified candidates to perform
for general-interest topics? the business’s work?
PRACTICE BOOK» NOT FOR SALE
A. Media articles A. persuading
B. Academic journals B. leading
C. Government publications C. staffing
D. Market analyses D. controlling
1369. A small-business manager who consid- 1374. Information system that combines and
ers how a one-person reduction in office summarizes ongoing transactions within
staff could impact the rest of his/her com- the company to provide top-level execu-
pany is demonstrating tives with information needed to make de-
A. technical skills. cisions affecting the goals and directions
of an organization.
B. interpersonal skills
A. executive information system
C. conceptual skills
B. web-hosting service
D. job-knowledge skills
C. VoIP
1370. a top-level manager who spends almost D. management information system
all of his or her time on management func-
tions and decisions that affect the entire 1375. Which business strategy am I? Re-
company sponds to the environment in an ad hoc
A. Management fashion, takes whatever actions that ap-
pear to be the most expedient at the time.
B. manager
A. Focus
C. supervisor
B. Prospector
D. executive
C. Reactor
1371. The role of finance is to D. Analyzer
A. Provide information for decision mak-
ing 1376. Which of the following college degrees
is an excellent foundation for a career in
B. Forecast what might happen in the fu- business:
ture
A. Fine arts
C. To motivate staff
B. Biology
D. To find out the stage of each product
within its life cycle C. Literature
D. Finance
1372. Which of the following is NOT a factor
that determines quality 1377. To make organizations more effec-
A. Durability tive, the mission and strategy must be
aligned with four organizational charac-
B. Consistency teristics:structure, systems, culture, and
C. Realiability ?
D. Managers A. Procedures
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 618
B. Production 1383. Organizing can help companies handle
C. Processes issues with so employees know to
whom to report and who is responsible for
D. Planning what.
1378. What are the 4 stages inn Lawrence and A. authority
Nohria’s Four Drive theory? (ABCD) B. reputation
A. Acquire, Bond, Comprehend, Defend C. efficiency
NARAYAN CHANGDER
B. Acquire, Bond, Communicate, Defend D. tracking
C. Ask, Behave, Communicate, Do
1384. The management function that deter-
D. Acquire, Behave, Comprehend, Deter- mines to what extent the business is ac-
mine complishing the goals is set out to reach in
1379. Public sector company is owned by the planning stage is
A. Government A. organizing
B. Group of 20 people B. planning
C. Indivuduals C. controlling
D. A company D. staffing
1380. When BlueLight, Inc. merged with a 1385. The Behavioural Approach follows
competitor, the managers strive to in- which type of Leadership
struct their employees on the best ways A. Autocratic
to transition. This is an example of how
B. Libertarianist
directing
C. Beurocratic
A. motivates employees.
D. Democratic
B. coordinates work and effort.
C. builds group dynamics. 1386. Lucy, who works for the Green Corpo-
ration, is responsible for handling special
D. initiates changes smoothly.
events and responding to requests for in-
1381. What kind of customer would ask “If I formation about the company. Lucy works
buy this product, how can I be sure it will in
do what you say it will”? A. professional selling.
A. Suspicious B. merchandising.
B. Eager C. marketing research.
C. Slow/Methodical D. marketing communications.
D. Domineering/Superior
1387. Luther Gullik classifies the function of
1382. MBO stands for? management as
A. Management by Goals A. POSDCORB.
B. Motivation of Objectives B. POSTCARD.
C. Management by Objectives C. POSDCORB..
D. Management by Outcomes D. POSDORBC
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 619
1388. Father of Principles of Management 1393. An organization which has strategic cor-
porate units in multiple countries that in-
A. Mary Parkett
teract both with the headquarters and
PRACTICE BOOK» NOT FOR SALE
B. Lillian Gilberth with each other.
C. Henry Fayol A. Global Firm
D. Elton Mayo B. Global Organization
1389. Planning, organizing, leading, and con- C. Global Unit
trolling are the four of management. D. Global Corporation
A. Characteristics 1394. Record showing what a customer owes
B. Functions and pays.
C. Objectives A. accounts receivable record
D. none of above B. accounts payable record
C. operating record
1390. As it relates to location, some busi-
nesses will set up more than one branch D. budget record
or location in the same area, even if the
1395. Which of the following is not an exam-
newer locations are eating up some of the
ple of sustainable business practices?
profits from the existing location, this is
known as A. Cradle to grave manuacturing
A. Bulk increasing B. Cradle to cradle manufacturing
B. Cannabalistic marketing C. Green tehnologies
C. Bulk decreasing D. Recycling, reusing and reducing
D. Outsourcing 1396. The federal government responded to
strikes like the Pullman strike by
1391. The function being performed when a
manager is determining how plans can be A. negotiations through collective bar-
accomplished most effectively is gaining
A. planning B. using military force against the work-
ers/strikers
B. organizing
C. staying out of it
C. leading
D. supporting the workers
D. controlling
1397. The introduction of the National Living
1392. Having representatives from different Wage of £7.20 for 25 year olds and over
backgrounds, cultures, or demographics in April 2016 is an example of which ex-
come together in a group ternal factor?
A. Managerial Roles A. Political
B. Management B. Economic
C. Diversity C. Social
D. Organizing D. Competition
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 620
1398. Which of the following is NOT a compo- 1403. POLC stands for
nent of the production process? A. Planning, Organising, Learning, Con-
A. Creating products or services trasting
B. Growing products or services B. Planning, Organising, Learning, Con-
C. Manufacturing products or services trolling
D. Selling products or services C. Planning, Organising, Leading, Con-
trolling
1399. A business’s organizational structure
NARAYAN CHANGDER
D. Practicality, Organising, Learning,
can sometimes have a negative effect Contrasting
on customer relationship management be-
cause 1404. This measures an employee’s perfor-
A. the marketing department has the mance according to set standards. It is
most power. usually conducted at the end of a project,
contract or specific goal.
B. CEOs don’t like dealing with cus-
tomers. A. Self-appraisal
C. customers will only deal with one de- B. Summative
partment. C. Formative
D. different departments have different D. 360-degree
methods.
1405. Most of the operational planning in a
1400. Which is the ability to handle different business is the responsibility of supervi-
people and their different attitudes? sors
A. Adaptability A. True
B. Dependability B. False
C. Responsibility C. Wrong answer-don’t pick
D. Tolerance D. none of above
1401. There are normally fewer first-line man- 1406. A certain company values creativity and
agers than middle or top-level managers. encourages this trait among its employees,
A. Employees affecting how its brand promise is carried
out. This factor is called
B. Office supplies
A. advertising.
C. Equipment
B. corporate culture
D. Sales revenue
C. branding.
1402. Government regulations are generally D. brand awareness
designed to
A. create jobs for government workers 1407. Which of the following is not an advan-
tage to being in a partnership?
B. protect the public from harmful or un-
just actions A. Minimal government regulation
C. increase the number of political cam- B. Shared workload
paigns C. Unlimited liability
D. make people thinks before they vote D. Shared risk
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 621
1408. None of the other managerial functions C. Products can be expected to be safe
can be carried out effectively without for use
staffing because D. Products should last at least six
PRACTICE BOOK» NOT FOR SALE
A. all of an organizations’s communica- months
tions are created during staffing
1413. There are key strategies to seeking
B. staffing lays the foundation for orga- domestic and global opportunities
nizing
A. 3
C. staffing supplies the human resources B. 4
needed for management
C. 5
D. businesses are legally required to set
up staffing first D. 6
1414. Which of the following are business ex-
1409. three primary factors that affect the
penses?
organizational structure of a business in-
clude interpersonal relationships, tasks, A. personal care
and B. advertising
A. attrition C. revenue
B. injunction D. supplies
C. authority 1415. (Separation Costs + Replacement Costs
D. initiative + Training Costs + Lost Performance) /
Number of Replacements
1410. Who originated the idea of paying em-
A. Turnover Rate
ployees using a piece rate?
B. Training Investment Factor
A. Douglas McGregor
C. Human Capital ROI
B. Frederick Taylor
D. Turnover Costs per Employee
C. Henri Fayol
1416. Which is NOT part of Senge’s theory?
D. W. Edwards Deming
A. Developing a business-wide attitude of
1411. Summaries of financial information and continuous learning
activities.
B. It involves managers telling employ-
A. financial records ees what to do
B. working capital C. It allows businesses to adapt to
C. accounts receivable record change quickly
D. liabilities records D. It assumes change is continuous and
evolving
1412. Which of the following are automatic
1417. The exploitation of workers during the
consumer rights? (Hint, there may be
Gilded Age led to
more than one correct answer-select all
that apply) A. the rise of capitalism
A. Products should be free from defects B. the rise of labor unions
B. Consumers can return goods for C. government control over economics
change of mind D. the 3/5’s Compromise
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 622
1418. These are the clearly defined targets 1423. efficient resource use is an advantage of
of a business in order to achieve its the organizational structure.
aims. They are often based on the SMART
A. Line-and-staff
acronym-specific, measurable, agreed, re-
alistic and time specific. B. matrix
A. Mission C. span-of-control
B. Goals D. bureaucratic
NARAYAN CHANGDER
C. Aims
1424. A computer-based system that stores,
D. Objectives
organizes, and provides information about
1419. According to the Business Video presen- a business
tations, which of the following is an impor- A. Management Information System
tant time period in the history of manage-
ment? B. What-If Analysis
A. Independent war C. Symptom Analysis
B. Industrial Revolution D. Computer Solutions
C. World War I
1425. The ability to consider alternatives by
D. World War II analyzing “what if” scenarios is a key ca-
1420. the use of computer programs to con- pability of a(n)
trol machine tools and related machinery A. DSS
in manufacturing of products.
B. ISP
A. CAD
C. EIS
B. CAM
C. advanced technology D. MIS
D. automation 1426. What kind of businesses are motivated
to earn a profit?
1421. Antonio tells his staff to sort through
files to locate notes from a meeting. Anto- A. Public
nio is
B. Nonprofit
A. supervising
C. Private
B. instructing
D. Government
C. motivating
D. disciplining 1427. An important aspect of the organizing
function of management involves which ac-
1422. The way a manager treats and involves
tivity?
employees is called
A. conducting performance reviews
A. entrepreneurship
B. influence B. motivating team members
C. management style C. establishing levels of authority
D. leadership D. promoting employees
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 623
1428. Effective management planning should 1433. Which of the following is defined as ad-
be which of the following? vising or training a new company?
PRACTICE BOOK» NOT FOR SALE
A. Realistic and flexible A. networking
B. Difficult and unmanageable B. collaborating
C. mentoring
C. Complex and stringent
D. job analysis
D. Easy and whimsical
1434. A well-planned organizational design
1429. Which of the following methods of mar- helps a business to better compete be-
ket research are more useful for quantita- cause
tive research, rather than qualitative re-
A. the business is more productive.
search?
B. it cuts down on communication.
A. Interviews
C. the business has more money.
B. Media articles
D. competitors don’t have organizational
C. Focus groups structures.
D. Government publications 1435. Which of the following organizations
can be beneficial for students who are in-
1430. Which of the following is NOT an aspect terested in becoming a human resources
of social responsibility? manager?
A. Green marketing A. Health Occupations Students of Amer-
B. The ozone layer ica
B. Technology Student Association
C. Air and water pollution
C. National FFA
D. Conservation and recycling
D. Business Professionals of America
1431. refers to a signal which will inform
1436. An example of an important ratio is
workers of a problem in the production
process. It allos problems to be identifed A. Current ratio
and resolved as quickly as possible. B. Debt ratio
A. Kanban C. Start up ratio
B. Andon D. Profit ratio
C. Kaizen 1437. Josh works at ‘Matsuri Tyres and
Wheels’ for more than 5 years. He
D. JIT
is wanting to quit his job and move
to another Tyre company, How much
1432. Which of the following tests can be used
time/notice would he be required to give
within the selection process?
to his current workplace?
A. Intelligence test
A. 1 week
B. Medical test B. 2 weeks
C. Attainment test C. 3 weeks
D. Communication test D. 4 weeks
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 624
1438. This person might work on a ranch or in A. Human Resource Manager
a nursery or a greenhouse. B. Human Resource Specialist
A. Loan Officer & Counselor C. Human Resource Administrator
B. Public Relations D. Human Resource Generalist
C. Farm Operator
1444. How many functions of management do
D. Human Resources most managers carry out?
1439. helps employees develop interper- A. Two
NARAYAN CHANGDER
sonal skills B. Three
A. Cognitive training C. Four
B. Off-the-job training D. One
C. Behavioural training
1445. Customer relationship management in-
D. On-the-job training creases sales and profits by increasing
1440. Which of the following can change the A. prices.
context of a word? B. product quality.
A. Eye-contact C. customer loyalty.
B. Volume D. competition.
C. Posture
1446. The ability to motivate individuals and
D. Emphasis groups to accomplish important goals is
1441. Katherine is determining the objectives called
for her company for the year. What func- A. leadership
tion of management is this? B. management
A. Planning C. influence
B. Leading D. initiative
C. Organizing
1447. The number of subordinates assigned to
D. Controlling a supervisor.
1442. The sector that provides intellectual, A. Staff Authority
knowledge-based activities to generate B. Centralized Authority
and share information, eg R & D, consul-
tancy services and scientific research. C. Span of Control
A. Primary D. Division of Labor
B. Secondary 1448. A performance management strategy in
C. Quaternary which an employee reflects on their own
performance.
D. Quinternary
A. Self-Evaluation
1443. A human resource manager who is re- B. Management by Objectives
quired to understand all of the major per-
sonnel functions and how they interact C. Appraisal
with other business functions. D. Employee Observation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 625
1449. Businesses with customer-service mind- C. Promotion
sets are usually able to D. Public Relations
PRACTICE BOOK» NOT FOR SALE
A. achieve their goals.
1454. Movement of cash into and out of a busi-
B. hire more employees. ness is known as
C. reduce their expenses. A. profit sharing
D. satisfy their vendors. B. cost of goods sold
1450. There are 4 effective performance man- C. operating expenses
agement strategies. Which of the follow- D. cash flow
ing is NOT one of them?
A. Appraisals 1455. One way to show respect for foreign
clients’ cultural and social differences is to:
B. MBO
A. use slang and idioms frequently.
C. Employee observation
B. pronounce their names correctly.
D. Self-evaluation
C. always speak in your native language.
E. Employee satisfaction
D. embrace cultural stereotypes.
1451. Unique skills or resources that give an
1456. Brenda and Alan are meeting with new
organization a competitive edge.
employees to explain the company’s aims
A. Core Competency and objectives to them.
B. Competitive Advantage A. Leading
C. Competitor Analysis B. Planning
D. Centralized Authority C. Organizing
1452. Which of the following is NOT one of the D. Controlling
factors that determines the effectiveness
1457. Information in an unorganized form (al-
of a supervisor?
phabets, numbers, or symbols) that have a
A. the quality of work of the supervised relationship with current conditions, ideas,
employees or knowledge
B. the efficient use of the company’s re- A. Data
sources B. Numbers
C. an increase in the company’s total C. Quota
profits
D. Statistics
D. the satisfaction of the supervisor’s em-
ployees 1458. The primary reason businesses keep fi-
nancial records is to
1453. This is any form of communication a
business or organization uses to inform, A. comply with federal laws
persuade, or remind consumers about its B. keep track of debts owed
products or services. C. determine if they have made a profit or
A. Advertising loss
B. Personal Selling D. make monthly payments on time
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 626
1459. Kemper Corporation continuously up- 1464. A firm that has a centralized organiza-
dates the firewalls on its web site to pro- tion concentrates authority with
tect its customers’ personal information
A. individual contributors
from theft. Kemper’s action helps build
trust with its customers in relation to: B. line managers
A. calculation errors. C. middle managers
B. physical safety.
D. top Managers
C. product tampering.
NARAYAN CHANGDER
D. online security. 1465. Management theory that identifies the
most effective practices for organizing and
1460. Which of the following is NOT an exam- managing a business:
ple of a quality business?
A. administrative management
A. greeting customers
B. good working conditions for employ- B. behavioral management
ees C. organizing
C. not returning customer phone calls
D. classical management
D. a clean store
1461. Which of the following are driving 1466. The is how many employees are di-
forces? (According to the study design, se- rectly under the authority of a particular
lect all that apply) manager.
A. Managers A. Span of control
B. Time B. Delegation
C. Legislation C. De-layering
D. Technology
D. Hierarchy
E. Pursuit of Profit
1462. What is the 1st step in the Human Re- 1467. Which is not a drive in Lawrence and
source Audit Process? Nohria’s motivation theory?
A. Develop the audit questionnaire and A. Acquire
collect the data
B. Lead
B. Provide feedback and evaluation
C. Bond
C. Develop an action plan
D. Define the responsibilities of the hu- D. Comprehend/Learn
man resource department
1468. Branding includes all the things related
1463. The main difference between arbitration to the of your business.
and mediation is that
A. Look, sound, and feel
A. mediation applies to criminal cases.
B. Pictures, colors, and fonts
B. mediation involves a third party.
C. arbitration involves a judgment. C. Tone, words, and ideas
D. arbitration is a non-binding process. D. Look, tone, and feel
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 627
1469. An approach to quality enhancement C. Leadership style is how a manager in-
that permeates (spreads throughout) the sults his workers
whole organization. It can include quality
PRACTICE BOOK» NOT FOR SALE
D. Leadership style is what the manager
circles and benchmarking, as well kaizen, is wearing
kanban and andon.
A. Total quality management 1474. is a direct response to a specific, un-
predictable event.
B. Lean production
A. Contingency planning
C. Mass production
B. Waste management
D. none of above
C. Crisis management
1470. A is an economic good; an article D. Safety management
of commerce especially when delivered for
shipment. 1475. Bryant Technical College is offering an
online degree in landscape design. This
A. Commodity
product is considered a(n)
B. Contract
A. virtual service
C. Database
B. outsourced service
D. Merger
C. low-quality product
1471. Which part of an income statement D. merger
shows all the costs incurred in operating
the business? 1476. Which career is best suited for people
who have a high school diploma?
A. total liabilities
A. administration and information sup-
B. expenses port
C. profit or loss B. human resources
D. revenue C. business financial management and
accounting
1472. How does solving difficult-customer sit-
uations benefit you personally? D. business analysis
A. You will encounter difficult customers 1477. The chain of command from the highest
less frequently. authority to the lowest level in the orga-
B. Your customers will be happier. nization is
C. You gain valuable communication A. Centralization
skills. B. Unity of command
D. Your boss will automatically give you a C. Unity of direction
raise.
D. Scalar chain
1473. What is leadership style? 1478. The technique to generate ideas by a
A. Leadership style is the way a manager group of co workers coming together and
treats and directs employees writing a list of their ideas, add comments,
B. Leadership style is the way a manager and then the leader takes the best ideas.
treats employees A. Wish List
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 628
B. Brain Writing B. Loading
C. Brain Storming C. Skill Variety
D. MY Brain Hurts!!!!!!! D. Production Planning
1479. The concept that there are three im-
1484. What is an important question that a
portant stakeholders for every company-
manager must consider when hiring a new
the stockholders, the customers, and the
employee?
employees-and for a business to succeed
NARAYAN CHANGDER
in the long run it must satisfy the expecta- A. what are the company’s product qual-
tions of all three stakeholders. ity standards
A. HR Scorecard B. what is the company’s vision
B. HR Metrics C. how should the workload be dis-
C. Balanced Scorecard tributed
D. HR Dashboard D. how will the company compensate this
worker
1480. Henry Fayol is laid down
A. 12 Principles 1485. producing a one-off item specially de-
signed for the customer
B. 14 Techniques
A. mass customisation
C. 14 Principles
D. 15 Principles B. flow production
C. batch production
1481. Which of the following is NOT an activ-
ity associated with the controlling function D. job production
of management?
1486. Which type of sales promotion is a
A. Setting standards
punch card? Punch cards are a common ex-
B. Evaluating performance ample of customer relationship incentives.
C. Setting standards A. Free sample
D. Allowing for missed deadlines B. Voucher and Coupon
1482. Decentralised decision-making is ? C. Customer Loyalty Program
A. Managers make all decisions. D. Refund
B. Decision making being made after con-
sultation. 1487. Keri works as a public relations con-
sultant for a large corporation. She re-
C. Hierarchical structure of decision-
views issues and makes recommendations
making.
to managers. Keri has authority.
D. Giving free rein or a hands off style
A. functional
1483. What has revolutionized the way busi- B. divisional
nesses in many industries produce their
products? C. line
A. Computers D. staff
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 629
1488. What is the advantage for work test- 1493. The process of making sure work meets
ing? acceptable standards.
PRACTICE BOOK» NOT FOR SALE
A. provides the applicant with an oppor- A. work schedules
tunity to ask question about job place.
B. Subordinate
B. used for a wide variety of different
types of tasks and response C. Quality control
C. assessment of the actual skill needed D. Performance review
to carry out to the job.
1494. What are the five reasons to communi-
D. uses to assess skills such as to work in
cate effectively? ? ?
a team, leadership and decision making.
A. To inform, tell, persuade, convince,
1489. Why is location important to small busi- and absorb ideas.
nesses?
B. To inform, motivate, perform, con-
A. Most need good foot traffic to survive
vince, and absorb ideas.
B. many will stay away if it’s not easy to
find C. To inform, motivate, persuade, con-
vince, and absorb ideas.
C. customers don’t want to travel far
D. To interact, motivate, persuade, con-
D. all of the above
vince, and absorb ideas.
1490. “Administrative services” is a term
sometimes used to refer to as? 1495. List the five employer expectations:
A. business analytics A. Terms of notice
B. office management B. Business loyalty
C. human resources management C. Employment contracts (awards)
D. supply chain management D. Individual common law contracts
1491. The foundation beliefs that impact how
1496. Juanita wants to be the sole owner of
people think about and respond to organi-
a web design business. The simplest form
zational events, but which are mostly sub-
she could choose would be a
conscious.
A. Shared Assumptions A. Proprietorship
B. Shared Norms B. Joint Venture
C. Code of Ethics C. Partnership
D. Organizational Culture D. Corporation
1492. Refers to an organization’s efforts to
1497. Enterprise is a Factor of Production.
minimize the negative effects of potential
Identify the other Factors of Production.
crisis.
A. Land, Labour and Country
A. Operations management
B. Waste management B. Primary, Secondary and Tertiary
C. Crisis management C. Private, Public and Third
D. Contingency planning D. Land, Labour and Capital
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.8 Business Management 630
1498. A designed change that increases the C. Re-do
usefulness of a product, services, or pro- D. Recovery
cess
A. innovation 1504. refers to the behaviour and attitude of
the manager when making decisions, di-
B. invention recting and motivating staff and when im-
C. improvement plementing plans to achieve business ob-
D. entrepreneur jectives.
NARAYAN CHANGDER
A. Management Direction
1499. The amount owed to a business by its
customers is considered B. Management Style
A. accounts payable C. Decision Making
B. an asset D. Management Decision
C. capital 1505. How many levels of planning and man-
D. a liability agement are there?
A. 1
1500. When an employee has an obligation to
do an assigned task, the employee has B. 2
been given C. 3
A. responsibility D. 4
B. a goal
1506. An irate business customer yells at you
C. authority because of a billing error. What should
D. a procedure you do to demonstrate a customer-service
mindset in the following situation?
1501. The law that requires employees to pay
A. Make sure the mistake is corrected.
covered employees overtime pay at 1.5
times the regular rate of pay is the B. Blame the billing department.
A. Civil Rights Act C. Get as upset as the customer.
B. Workers’ Compensation Law D. Call the customer’s supervisor to com-
plain.
C. Fair Labor Standards Act
D. Occupational Safety and Health Act 1507. Projects are different from business op-
erations because business operations
1502. Which of following is not a management
function as given by H Fayol. A. are special ventures.
A. Planning B. are permanent.
B. Organizing C. use nontraditional management struc-
tures.
C. Controlling
D. have a definite beginning and end.
D. Staffing
1508. A degree is common to start an
1503. Reduce, reuse, recyle and ? entry-level job in Human Resources Man-
A. Re-evaluate agement.
B. Replenish A. Master’s
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 631
B. Doctorate A. gather information
C. Bachelor’s
B. identify possible symptoms
PRACTICE BOOK» NOT FOR SALE
D. Two-year
C. evaluate alternative solutions
1509. The first step in the problem-solving
procedure is to D. identify the problem
1.9 Human Resource Management
1. A comprehensive legal framework for em- 5. What does a job specification include?
ployee rights which covers all aspects of A. Personal characteristics
employing staff.
B. Physical characteristics
A. Modern Award Standards
C. Psychological characteristics
B. Fair Work Ombudsman
D. All of the above
C. Racial Discrimination Act 1975
D. Fair Work Act 2009 6. The business side of the process begins
with the strategic as one of the guiding
2. Which of these would not normally be frameworks.
found in a job description?
A. Policy
A. Job Title
B. HR
B. Roles and duties
C. Plan
C. Skills and abilities required
D. All of the above
D. Employment conditions
7. Which is usually NOT included in a job de-
3. the major responsibilities of the HR Team scription?
where HR managers come up with plans
and strategies for hiring the right kind of A. Salary
people. B. Job duties
A. Maintaining work atmosphere C. Qualifications
B. Recruitment and Selection D. Conditions
C. developing public relations
8. an employee’s voluntary decision to leave
D. managing disputes the company
4. An employee takes a shortcut to complete A. termination
a task at work. The result of this action B. demotion
ispoorer customer service. This is an ex-
C. resignation
ample of
D. transfer
A. Workplace efficiency
B. Service exceeding company expecta- 9. Which of the following business trends af-
tions fects HR management?
C. deficiency of knowledge A. No restructuring
D. deficiency of execution B. Lack of new technology
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 632
C. Costs of business going down B. personal
D. Globalization C. minor
10. are rewards other than cash, such as D. soft
paid time off, insurance, or a retirement
plan, given to employees. 15. Which term refers to training and evaluat-
ing employees?
A. salaries
B. Benefits A. hiring and firing
NARAYAN CHANGDER
C. commissions B. employee orientation
D. policies C. human resources management
11. Which one of the following are the func- D. job description
tions of personnel management?
16. What is external recruitment?
A. Planning, Organising, Staffing, Direct-
ing and Controlling A. Recruiting from outside the company
B. Planning, Organising, Coordinating, B. Recruiting from Asia
Budgeting and Controlling
C. Recruiting from current employees
C. Procurement, Development, Compen-
sation, Integration and Maintenance D. Recruiting from universiy
D. Perception, Development, Learning, 17. Which of the following is NOT one of the
Organisation and Behaviour Conflict Resolution Techniques?
12. Which of the following conflict resolution A. Comparing
techniques will generate the MOST lasting
solution? B. Smoothing
A. Forcing C. Forcing
B. Smoothing D. Withdrawal
C. Compromise
18. Core Function of all organization
D. Problem Solving
A. Human Resource
13. each and every activity of the HRM
B. Human Resource Management
will be a strategy to achieve the organisa-
tional Goal. C. Human Resource Development
A. HRIS D. none of above
B. HRM
19. Making a company smaller by eliminating
C. SHRM
staff positions
D. HRD
A. Outsourcing
14. Personality traits and personal abilities B. Off Shoring
such as personal habits and friendliness
are considered skills C. Downsizing
A. flexible D. Strategic Planning
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 633
20. Which of the following is a function of per- 25. What refers to the administrative special-
sonnel management? ization that focuses on hiring and develop-
ing employees to become more valuable to
PRACTICE BOOK» NOT FOR SALE
A. Selection of right type and number of
people inside an organization the company?
B. To give a good impression to the man A. Personnel management
who is leaving the organization B. Professional development
C. Maintaining good relations with peo- C. Human development
ple
D. All answers are correct
D. All answers are correct
26. The meaning of the acronym HRM is
21. Which of the following is not an input into
Develop Human Resource Plan? A. Human Resourceful Management
A. Enterprise Environmental Factors B. Human Relation Management
B. Role and Responsibility assignments C. Humanistic Resource Management
C. Organizational Process Audits D. Human Resource Management
D. Activity Resource Requirements 27. Designation, Location and Job related du-
ties are mentioned in the:
22. The act passed in 1947 to rebalance the
power between labor and management A. Job Description
and toensure a healthy labor-management B. Job Specification
environment is the
C. Job Evaluation
A. Wagner Act
D. Recruitment Letter
B. National Labor Fair Standards Act
C. Landrum-Griffin Act 28. It’s limit the effectiveness of the training.
D. Taft-Hartley Act A. Situation Constraints
B. Work Environment
23. In HR which of the following is considered
a voluntary separation? C. Person Analysis
A. transfer D. Training Need Assessment
B. lay off 29. Kim is an independent contractor who
C. retirement cleans a school. Which of the following
statements is true regarding Kim’s employ-
D. resignation
ment?
24. A formal interview with an employee who A. She is entitled to four weeks annual
is leaving the small business to determine leave.
his or her attitudes about the business and
suggestions for improvement. B. Her employment is subject to award
conditions
A. Layoff
C. She is responsible for paying her own
B. Employee Turnover income tax.
C. Exit Interview D. She is entitled to maternity leave pro-
D. Discharge vided by the school.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 634
30. The term ‘human resource management’ B. Selection
describes the: C. Depends on the profile
A. concept of competing through techni- D. Depends on the company structure
cal resources in organisations
36. PF act is applicable to an establishment en-
B. economic value of employees’ knowl-
gaged in any industry specified in
edge, skills and capabilities
A. Schedule II
C. policies and practices involved in man-
B. Hazardous Industries List
NARAYAN CHANGDER
aging managers of an organisation
D. effective utilisation of an organisa- C. Schedule IX
tion’s people and their talent D. Schedule I
31. A list of a jobs human requirements that 37. A plan that shows how the various jobs in
is the requisite education skills personality a company relate to one another is a:
and so on, another product of job analysis A. benefit
A. job specifications B. delegate
B. job description C. organizational structure
C. job analysis D. job analysis
D. job enrichment 38. Which is NOT a hygiene factor?
32. A psychomotor test is BEST used for a/an A. Working conditions
B. relationship to supervisor
A. accountant C. Salary
B. cleaner D. profit-share scheme
C. receptionist
39. Which is not one of the major challenges
D. manager currently facing HR managers?
33. A pension plan is an example of a(n)? A. Motivating employees without pay
raises and promotions
A. Fringe benefit
B. Changing federal, state and local legal
B. Bonus check requirements
C. Commission C. Replacing “baby boomers” as they exit
D. Profit-sharing plan the workplace
34. The basic managerial skill(s) is(are) D. Adjusting benefit programs due to in-
creasing costs
A. To supervise
40. The following is concerned with develop-
B. To stimulate
ing a pool of candidates in line with the
C. To motivate human resources plan.
D. All of the above A. Development
35. Which is a more time consuming phe- B. Training
nomenon C. Recruitment
A. Recruitment D. All the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 635
41. Which of the following statements is a po- 46. Employees are
tential a negative of flex time plans? A. never to be trusted
PRACTICE BOOK» NOT FOR SALE
A. It causes traffic congestion B. all looking out for the best interests of
B. It can make communication among em- the company
ployees more difficult C. the easiest resource to replace within
C. The employees resent being required an organisation
to come to work early or stay late D. the most valuable resource and the
D. Workers tend to be less productive hardest to replace
42. Majority of the disputes in industries are 47. What does Just-In-Time production help
related to the problem of with?
A. Wages A. Creating waste
B. Taking away jobs
B. Salaries
C. Increasing efficiency
C. Benefits
D. Making products heavier
D. All the above
48. According to the AMO model, which char-
43. What is switching staff between different acteristic decribes motivation-enhancing?
tasks to prevent monotony called?
A. Recruiting
A. job rotation
B. Competitve pay
B. job enlargement
C. Work teams
C. job enrichment
D. Selecting
D. none of above
49. A business is most likely to have to invest
44. To increase the profit of all divisions by in more training when
15% per year, would be an ‘MBO’ objec- A. it receives significant finance from a
tive of which level of the hierarchy? venture capitalist
A. Aim B. a major competitor leaves the market
B. Corporate objective C. it is implementing a new, organisation-
C. Divisional objective wide IT system
D. Departmental objective D. it becomes the market leader
E. Individual target 50. Which of the following is not an objective
of Human Resource Management:
45. the minimum qualifications required by a
A. Selection and recruitment
particular job such as education and expe-
rience B. Dealing with workplace relations to en-
sure that employees are satisfied
A. job analysis
C. Implementation of policies and proce-
B. job title
dures to ensure that the business is com-
C. job description pliant with legislation
D. job specification D. Firing staff
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 636
51. The management theory that states that B. Interview Method
all people can direct their own efforts is: C. Questionnaire-Interview Method
A. Theory Y D. Observation and Interview Method
B. Herzberg’s theory
57. is the on the training.
C. Maslow’s hierarchy
A. Coaching
D. Theory X
B. Workshop
NARAYAN CHANGDER
52. Which of the following is NOT a way to
C. Audio visual
motivate employees?
D. Case studies
A. pay them well
B. treat them fairly 58. In a re-engineering programme, when a
process changes so does the of the con-
C. recognize them for good work
cerned employee.
D. make all decisions for them
A. Designation
53. The changing role of HR manager doesn’t B. Job profile
include
C. Qualification
A. Employee Advocate
D. Job experience
B. Welfare Leader
C. Change Agent 59. HR department viewed as the specialists
in the areas that encompasses Human Re-
D. Change Champion source or people management.
54. determination of adequate and equitable A. Executive Role
remuneration of personnel for their contri- B. Audit Role
bution to organization’s objectives
C. Facilitator Role
A. Compensation to Personnel
D. Consultancy Role
B. Procurement of Personnel
C. Development of Personnel 60. An evaluation of the performance level of
employees against established standards
D. Record Keeping
A. job analysis
55. Life insurance, sick leave, and holiday pay
B. performance appraisal
are examples of
C. job specification
A. benefits
D. job description
B. employee contributions
C. pension plans 61. Which of the following aspects of human
resources would a business not be able to
D. profit sharing
outsource?
56. Each employee is given a set of ques- A. Training and development
tions.In answering this, he describes his
job, its operations, his duties andrespon- B. Payroll administration procedures
sibilities. C. Supervision of staff
A. Questionnaire Method D. Recruitment
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 637
62. What’s the 7th process of the Human Re- 68. A newly-hired employees often complete
source Management (HRM) process. an orientation program. Which of the fol-
lowing is is not part of an orientation pro-
PRACTICE BOOK» NOT FOR SALE
A. Career development
gram
B. Compensation and benefits
A. Inform employees about company poli-
C. performance management
cies
D. Orientation
B. Employee manuals
63. Expand RTUC
C. Training
A. Regional Trade Union Congress
D. Free vacation trips
B. Red Trade Union Congress
C. Real Trade Union Congress 69. A stock or supply of something that has
D. Resource Trade Union Congress value or purpose. What is this a definition
of?
64. Which function of the management process
requires a manager to establish goals and A. Management
standards and to develop rules and proce-
B. Sustainablity
dures?
A. planning C. Resource
B. organizing D. Distribution
C. staffing
70. The core purpose of HRM is
D. leading
A. Select the right person for the task
65. a questionnaire used to collect quantifiable
data concerning the duties and responsibil- B. satisfaction of employees
ities of various jobs C. safety of employees
A. workflow analysis
D. Make the efficient purpose of existing
B. Position Analysis Questionaire HR
C. Job analysis
71. Which is NOT part of a job description?
D. business process reeingineering
A. job title
66. Recruitment means
A. Total number of inquiries made B. tasks & responsibilities
B. Total number of selections made C. dress code
C. Total number of persons short listed D. qualification needed
D. Total number of applications received
72. Personnel is a common name for
67. Strategic Management handles
A. human resources
A. management issues
B. job applicants
B. external issues
C. administrational issues C. newly hired workers
D. internal issues D. temporary employees
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 638
73. The MOST common causes of conflict on D. Evaluate, Compenation, Planning, and
a project are schedules, project priorities, Training
and:
78. Which among the following are tasks of
A. Personality HR? (select 2)
B. Resources A. Accounting
C. Cost B. selling of products
D. Management C. Selection
NARAYAN CHANGDER
74. Demand for human resources and manage- D. Training
ment is created by
79. Lisa needs several waiters urgently to
A. Expansion of industry serve at an important function. To fill this
B. Shortage of labor temporary position, she should BEST use
C. Abundance of capital
D. none of above A. part time workers
B. expatriates
75. As a HR Manager what is the first step in
recruiting employees? C. word of mouth
A. Review Applications and Resume D. executive search agencies
B. Conduct Follow-up interview 80. A common disadvantage of off the job
C. Identify Job Requirements training is
D. none of above A. only teaches theory
B. boring courses
76. The employee appraisal process will not re-
sult in C. employees stay at work
A. reduction in employee stress related D. greater cost
to not knowing where they stand with the 81. As the business grows and expands, who
company will ultimately determine the success or
B. increased personal satisfaction for the failure of any small business.
employee A. retailers
C. new job searches by the employee B. vendors
D. opportunities for employees to identify C. employees
career goals and develop skills
D. consultants
77. Which one is the function of Human Re-
sources Management (HRM)? 82. The purchase of one business or company
by another company or other business en-
A. Job Analysis, Recruitment, De- tity is called as
Recruitment, Compensation
A. Merger
B. Placement, Job evaluation, Planning,
and Orientation B. Acquisition
C. Staffing, Training & Development, C. Licensing
Compensation and Administration D. Franchising
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 639
83. To is to let other people share work- 89. Occurs when the job ceases or when the
loads and responsibilities. employer can no longer afford to employ
the worker.
PRACTICE BOOK» NOT FOR SALE
A. delegate
B. share A. Termination
C. command B. Dismissal
D. task C. Suspension
D. Redundancy
84. What is the main focus of modern human
resource management? 90. Why would a business use internal recruit-
A. Compliance with regulations ment to find staff for the business?
B. Employee welfare A. It involves less risk
C. Administrative tasks B. Managers are lazy and can’t be both-
ered externally recruiting
D. Strategic alignment with organiza-
tional goals C. You can pay the staff a wage lower
than other members of the team
85. WIth a cafeteria plan, employees can D. none of above
choose
A. the hours that they want to work 91. “Medical facilities and unemployment in-
surance “payable is stated in
B. from among benefits of equal value
A. Employee State Insurance Act, 1948
C. the type of payment plan they want
B. Unorganized Sector Workers Social Se-
D. random days off from work curity Act, 2005
86. is the current minister of Human Re- C. Unorganized Sector Workers Social Se-
source development of India curity Act, 2005
A. Smriti Irani D. None of the above
B. Rajnath Singh 92. What is IJV?
C. Nirmala Sitharaman A. International Joint Venture
D. Ramesh Pokhriyal B. International Joint Venture
87. Which is not on the job training? C. International Jointers Venture
A. Job rotation D. International Juncture Venture
B. Internship 93. Which statement below BEST matches a
C. Coaching Theory X manager’s beliefs?
D. Classroom lectures A. People want to be rewarded for their
work
88. Induction and training of staff is a major
step in the cycle B. People have higher needs that will not
emerge until the lower level needs have
A. recruitment been satisfied
B. termination C. People will contribute to work if left
C. maintenance alone
D. employment D. People cannot be trusted
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 640
94. All of the following are typical concerns of 99. Fill in the missing words:Human Resource
matrixed team members EXCEPT? management is the process of an or-
A. Wondering who will handle their eval- ganisation’s human resources for the pur-
uations pose of achieving the organisation’s goals.
B. Servicing multiple bosses A. hiring, firing and keeping satisfied
C. Developing commitment B. acquiring and terminating
D. Computing fringe benefits when work- C. acquiring, developing and maintaining
NARAYAN CHANGDER
ing multiple projects D. hiring and firing
95. The complex network of interrelated activ- 100. People who provide specialty services to
ities in a MNE can be described in the fol- businesses on an hourly basis or by the
lowing structure: job:
A. Hierarchy A. interns
B. Heterarchy B. mentors
C. Autonomy C. freelancers
D. Entities D. coaches
96. What according to you is a more economi-
101. The Contingency Theory states that a
cal process (less expensive)?
leader’s effectiveness is contingent upon
A. Recruitment all but one of the following factors:
B. Selection A. Whether a leader is task-oriented
C. Depends on the Job Profile B. Whether a leader is goal-oriented
D. Could be either Recruitment or Selec- C. Whether a leader is relationship-
tion oriented
97. redesigning business processes to reduce D. How stressful the environment is
waste and increase performance
102. Support function that designs and imple-
A. workflow analysis ments company policies for managing em-
B. job enrichment ployees:
C. Position Analysis Questionaire A. Work Design
D. business process reeingineering B. HR manager
98. It deals with working conditions and C. HR department
amenities such ascanteens, rest and lunch D. Organizational culture
rooms, housing, transport, medical assis-
tance, education, health and safety, recre- 103. Treating people differently because of
ation facilities, etc. their disability is called
A. Welfare aspect A. superstition
B. Personnel aspect B. discrimination
C. Industrial relations aspect C. responsibility
D. none of above D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 641
104. Who laid the foundation of Human Re- A. Simulations
source Management practices? B. Classroom Instruction
PRACTICE BOOK» NOT FOR SALE
A. David C. McClelland C. Audiovisual Training
B. Roethlisberger and Dickinson D. On-the-Job Training
C. Peter Drucker and Douglas McGregor 110. Written tests, performance-simulation
D. Elton Mayo tests, realistic job preview and interviews
are the
105. The role of ethics in human resources
management involves: A. Selection errors
B. Selection process
A. treating all employees fairly.
C. Selection devices
B. organizing employees into groups.
D. Selection decision
C. planning the hiring process.
D. using resources wisely. 111. a measure of specific abilities and a test
of the applicant’s inclination to succeed
106. All of the following are normally included A. mental ability test
on a job description EXCEPT
B. IQ test
A. responsibility for human and physical
C. aptitude test
resources
D. personality test
B. tasks to be performed on a daily basis
C. job title 112. The process which is continuous and stops
only when the organisation ceases to exist
D. hourly pay rate
A. Training
107. A managers wishes to know if the can- B. Job evaluation
didates ‘can-do’ the job. To determine
C. Hiring
this, the manager should consider the can-
didates’ D. All of the above
A. interest 113. Employment rewards for service in addi-
B. attitude tion to salary are known as:
A. benefits
C. motivation
B. delegate
D. knowledge
C. wages
108. The Maternity Benefit Act was intro- D. staffing
duced in the year
A. 1961 114. This cover union-management relations,
jointconsultation, collective bargaining,
B. 1923 grievance and disciplinary procedures, set-
C. 1976 tlement of disputes, etc.
D. 1948 A. Industrial relations aspect
B. Welfare aspect
109. One of the training methods that least ex-
pensive and least time-consuming ways to C. Personnel aspect
accomplish that goal. D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 642
115. If labour supply exceeds labour demand, 120. What does a resource histogram show
HR needs can BEST be met by that a responsibility assignment matrix
A. succession planning does not?
B. redeploying surplus employees to A. Time
other areas of the organisation B. Activity
C. recruiting from the outside C. Interrelationships
D. replace those who leave with new em- D. The person in charge of each activity
NARAYAN CHANGDER
ployees
121. a workflow chart that shows the flow of
116. Which of the following is a benefit of em- inputs to and outputs from a particular job
ployee training? A. workflow analysis
A. Improves morale B. process chart
B. Helps people identify with organisa- C. job enlargement
tional goals D. job enrichment
C. Provides a good climate for learning,
growth and co-ordination 122. Which term refers to the process of veri-
fying certain information provided by a job
D. None of the above applicant
117. the vital aspect of HRM because the per- A. background check
formance of an individual in an organiza- B. compensation
tion is largely driven by the work atmo-
C. human resource management
sphere or work culture that prevails at the
workplace. D. performance appraisal
A. Performance Appraisals 123. A less experienced worker shadowing a
B. Maintaining Work Atmosphere more experienced one is an example of
C. Managing Disputes A. skills-based training
D. Develop Public Relations B. off the job training
C. on the job training
118. Which of the following is NOT a construc-
tive team role? D. external training
A. Information seeker 124. HRD process variable include
B. Recognition seeker A. Role clarity
C. Information giver B. Work planning
D. Gate Keeper C. Better communication
D. All of the above
119. Which type of organization is BEST
for managing complex projects involving 125. is the tool through which organiza-
cross-disciplinary efforts? tional development can be implemented
A. Projectized A. T & D
B. Functional B. HRM
C. Line C. Outsourcing
D. Matrix D. HR research
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 643
126. Which of the following people are not B. functional strategy
considered a part of an organisations hu- C. mission statement
man resources:
PRACTICE BOOK» NOT FOR SALE
D. strategy based metrics
A. Junior Sales Staff
B. Trainee 132. A compensation arrangement in which
employees are paid a portion of the com-
C. Plumber pany’s profits:
D. Senior Management A. profit sharing
127. Students who will work for little or no B. wages
pay in order to gain experience in a partic- C. benefits
ular field are called:
D. none of the above
A. interns
133. “Man of all the resources available to
B. temporary employees
man, can grow and develop” quoted by
C. freelancers
D. contractors A. Peter Morrison
128. These are all potential benefits of train- B. Peter.F. Drucker
ing except which one? C. Adam smith
A. increased staff overheads (costs) D. Karl Marx
B. lower staff turnover
134. Which of the following is an example of
C. improved motivation a fringe benefit?
D. helps introduction of new systems A. a salary
129. A list of the basic tasks that make up a B. commission
job. C. a company car
A. Job Description D. none of above
B. Transfer
135. which of the following fall under the cat-
C. Promotion egory of “scope in HRM”
D. Discharge A. Recruitment and Selection
130. is more frequently used ingathering facts B. share investment in other projects
about jobs. C. illegal trade unions
A. Interview method D. gambling at work place
B. Questionnaire method 136. is a method to increase employee pro-
C. Questionnaire-Interview Method ductivity by making changes to the way
D. Observation and Interview Method tasks get done.
A. Organizational restructuring
131. strategy by which managers in specific
areas decide how best to achieve corpo- B. Benchmarking
rate goals through productivity C. Onboarding
A. corporate strategy D. Redesigning work
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 644
137. To demonstrate that the dismissal was 142. Which of the following is the outcome of
fair, the employer must be able to demon- job satisfaction?
strate that one of the following
A. High employee turnover
A. Inability to perform work even after
B. High productivity
sufficient training has been provided
C. Absenteeism
B. Continuous positive attitude at work,
which has a good impact on the employee D. All the above
or his work
NARAYAN CHANGDER
143. Companies often provide a form called
C. Willful damage to employer property
a(n) on which they ask potential em-
D. All answers are wrong ployees to list their work experience, edu-
cation, skills, and references
138. Directing is one of the important func-
tions of HRM which comes under Func- A. application
tion. B. job description
A. Managerial Function C. resume
B. Operative Function D. summary
C. Technical Function
144. A layoff is an example of a(n) sepa-
D. Behavioral Function
ration
139. The leadership of trade unions is not A. active
rooted in the class.
B. passive
A. working
C. involuntary
B. weaker
D. voluntary
C. middle
D. High 145. Part time and temporary workers who
are often used when full-time workers are
140. The assignment of an employee to an- on leave or during busy seasons.
other job in the small business that in-
volves the same level of responsibility and A. Human resource employees
authority as the employee’s current job. B. Contingent workers
A. Job Description C. Apprentice
B. Promotion D. Retirees
C. Transfer
146. Appraisals, 1 to 1’s and other achieve-
D. Discharge ment recognition programs. The oppor-
141. Dipu is paid by the hour. What does his tunity to achieve and secure job promo-
take home pay depend on? tions.fulfills which need:
A. How much time he has worked A. Esteem
B. How much output he has made B. Self actualisation
C. How many items he has sold C. Social
D. none of above D. Safety
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 645
147. HRM Believes that Performance Ap- C. Competition
praisal is a D. Internal
PRACTICE BOOK» NOT FOR SALE
A. process
153. What is the main factor that influenced
B. system
the transition from traditional to modern
C. activity human resource management?
D. methods A. Social changes
148. is a factual statement of tasks & du- B. Technological advancements
ties involved in a job. C. Globalization
A. Job description
D. Environmental sustainability
B. Job specification
154. A meeting in which a recruiter asks a job
C. Job Analysis
applicant questions to see if the applicant
D. Job evaluation is right for a particular job is called a(n)
149. The process of enhancing the skills, the A. appointment
capabilities and the knowledge of the em- B. conference
ployees.
C. interview
A. Organizational Analysis
D. screening
B. Training needs Assessments
C. Training 155. The purpose of performance appraisal is,
D. Readiness except
A. Development
150. What type of Leadership style is most ap-
propriate at the beginning of a project: B. Retirement
A. Supporting Leader C. Motivation
B. Coaching Leader D. Compensation adjustment
C. Directing Leader 156. Which are tasks of HR?
D. Facilitating Leader A. Accounting
151. Which of the following is not stipulated B. Recruitment
in the Employment Law of Malaysia?
C. Selection
A. Rest days
D. Training
B. Permissible work hours
E. Controlling
C. Employment of foreign workers
D. Employee’s right to a polygamous mar- 157. Outsourcing is a part of function of
riage HRM
A. Analytical
152. Which of the following is a popular selec-
tion method? B. Strategical
A. Personality Test C. Operational
B. Orientation D. Managerial
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 646
158. the list of duties, responsibilities and re- 163. Which of the following issues tends to be
porting relationships well disguised?
A. job analyisis A. Territorial
B. job title B. Social
C. job desciription C. Political
D. job specification D. Economical
NARAYAN CHANGDER
159. Finding ways to reduce is a crucial re- 164. Human Resource refers to the in an
sponsibility of management. organisation
A. Stress A. raw materials
B. Dissatisfaction B. personnel
C. Uncertainty C. fixed assets
D. None of the above D. none of above
160. What theory proposes that employees’
165. In an addition to regular compensation,
efforts will lead to effective performance
are monetary incentives that an em-
and the employees will be rewarded for
ployee earns as a result of good perfor-
accomplishments?
mance.
A. Conditional reinforcement
A. Motivational techniques
B. Malsow’s Hierarchy
B. Financial reward
C. McGregor’s
C. Non financial reward
D. Expectancy
D. All the above
161. This is the right to make decisions about
assignments and how they will be accom- 166. Which of the following is not a tool and
plished. technique of the Plan Human Resource?
A. Organizing A. Organizational theory
B. Leading B. Networking
C. Authority C. Organization charts
D. Planning D. Rewards and recognition
162. What is recruitment? 167. Lean production is best defined as:
A. The process by which a business hires A. a system of frequent improvement
staff B. a production method that aims to re-
B. The process by which a business trains duce all forms of waste
staff C. a production method dependent on au-
C. The process by which a business in- tomation
ducts staff
D. a production method in which zero in-
D. none of above ventories are heldby the firm
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 647
168. The most basic or lowest-level need in 173. Which of the following is NOT a stage in
Maslow’s hierarchy of human motives in- the evolution of human resource manage-
cludes the need for: ment?
PRACTICE BOOK» NOT FOR SALE
A. self-esteem. A. Pre-Industrial Revolution Stage
B. love and friendship. B. Modern Stage
C. religious fulfillment. C. Traditional Stage
D. food and water. D. Transformational Stage
169. This is the most difficult challenge faced 174. Orientation and training of staff is a ma-
by modern HR professionals in the digital jor step in the cycle
world. A. recruitment
A. Possible replacement by Artificial intel- B. maintenance
ligence and loosing their jobs
C. termination
B. Too much low salary
D. employment
C. life challenges
D. None of the answers are correct 175. Rewards to employees include:-(select 3)
A. wages
170. an applicant faces several interviewers
who take turns in asking questions B. salaries or bonus
A. structured interview C. fringe benefits
B. experience-based interview D. fine or penalty on employees
C. panel interview 176. How many steps are necessary for the
D. unstructured interview hiring process of a potential employee?
A. 10
171. HR department is an information
provider to raise awareness and inform B. 8
department and functional areas on change C. 6
in policy. D. 5
A. Service Role
177. Unemployment insurance is generally
B. Executive Role provided to employees who are unable to
C. Audit Role work as a result of
D. Facilitator Role A. Fate
172. is the personnel activity by means B. Carelessness at work
of which the enterprise determines the ex- C. Pregnant condition
tent to which the employee is performing D. Annual leave
the job effectively
A. Job evaluation 178. The quantitative gauge of a human re-
source management activity such as em-
B. Work evaluation ployee turnover, hours of training per em-
C. Performance evaluation ployee, or qualified applicants per position
D. None of the above A. strategy based metrics
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 648
B. HR Strategy Map 184. Tools such as Twitter, Facebook, and
C. competitive advantage LinkedIn that can be used to recruit new
employees are known as
D. human resource metrics
A. data analytics
179. a training that gives employees the op- B. social media
portunity to experience other tasks that
require the same skills C. mobile applications
D. cloud computing
NARAYAN CHANGDER
A. mentoring
B. job rotation 185. Who formed Bombay Millhands Associa-
C. coaching tion and in which year?
D. total quality management A. Sorabjee shapurjee Bengali in 1980
180. Which is NOT a motivator? B. N.M Lokhandey in 1890
A. work content C. Social Service League in 1910
B. career opportunity D. None of the above
C. salary 186. Job analysis is a process of gathering in-
D. development formation about the
A. job
181. Safety Policy is a part of function of
HRM B. job holder
A. managerial C. management
B. operational D. organization
C. strategical
187. What is human resource management?
D. developmental
A. The communication of goals and the
182. Which is NOT an aspect of human re- provision of resources to employees
sources management? B. The daily supervision, allocation of du-
A. finding employees ties and evaluation of employees
B. selecting employees C. The use of domestic and global con-
C. evaluating employees tractors
D. firing employees D. The organisational hierarchy of a busi-
ness
183. is when HR Managers develop good
relationships, are trustworthy and deal 188. To let other people share workloads and
with everyone equitably. responsibilities:
A. Personal credibility A. benefits
B. Technical mastery B. delegate
C. HR mastery C. freelance
D. Business mastery D. recruit
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 649
189. The first step in the planning process is 194. an employee’s movement to another po-
analyzing and it involves the following ex- sition but within the same rank or respon-
cept: sibility
PRACTICE BOOK» NOT FOR SALE
A. Environmental factors A. promotion
B. Organization direction B. demotion
C. External workforce C. transfer
D. Logistical D. separation
195. is the process of choosing the most
190. Payments for labor or services that are
suitable candidate for the vacant position
made on an hourly, daily, or per unit ba-
in the organisation.
sis:
A. Recruitment
A. salary
B. Training
B. profit sharing
C. Selection
C. wages
D. Performance Appraisal
D. none of the above
196. The following is (are) the key com-
191. An accountant decides to use the services ponents of a business process Re-
of a cleaning company one day per week. engineering programme?
What is this an example of?
A. Product development
A. Global contracting B. Service delivery
B. Outsourcing C. Customer satisfaction
C. Development D. All of the above
D. Downsizing
197. How is a business most likely to encour-
192. The following are grounds for dismissal age applications for a post?
of an employee except: A. Job adverts
A. Misconduct B. Staff appraisal
B. Forcible resignation due to poor per- C. Internal recruitment
formance D. none of above
C. Accepting a voluntary retrenchment
198. The analytical Function of HRM doesn’t
D. Authorized causes under the law Includes
193. A training program that moves employ- A. HR Audit
ees to different tasks or departments to B. HR research
help them gain experience is called C. Performance Appraisal
A. circuit training D. none of the above
B. job rotation
199. The following is (are) the option(s) while
C. demonstration planning for surplus
D. orientation A. Reassign the jobs
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 650
B. Redesign the jobs 204. Who laid the foundation of HRM prac-
C. Reduce work hours tice?
D. All of the above A. Peter Drucker
B. Elton Mayo
200. Which statement does not belong to The-
ory Y C. Henry fayol
A. human beings will try to reach objec- D. Frederick Winslow Taylor
NARAYAN CHANGDER
tives using their creativity
205. is a type of job training in which one
B. the intellectual potential of human be- employee teams up with another more ex-
ings is only partly used perienced employee to learn a job.
C. human beings will only achieve corpo- A. Mentoring
rate objectives if threatened with punish-
ment B. on-the-job-training
D. the prospect of achieving a higher po- C. coaching
sition in a company will make employees D. staffing
work harder
206. Using overtime as a solution to a labour
201. In a arrangement two part-time em- shortage is BEST used when the shortage
ployees fill one full-time job.
A. job enlargement A. is expected to last a short period of
B. multitasking time
C. job sharing B. will last more than 12 months
D. split shift C. is less than 40 people
202. Means that no employee reports to more D. impacts only one department
than one supervisor at a time or for a par-
207. There are employee training meth-
ticular task.
ods.
A. Organization Chart
A. 4
B. Unity of Command
B. 5
C. Employee Empowerment
C. 6
D. Accountability
D. 7
203. BONUS:A Sampling method where the
batch of product is rated on a continuous 208. The following person has created the prin-
scale that shows how well the batch con- ciple of 8 hours work, 8 hours rest and 8
formed to ideal quality is called: hours sleep.
A. Tolerance Sampling A. Elton Mayo
B. Variable Sampling B. Flippo
C. Attribute Sampling C. Robert Owen
D. Special Cause Sampling D. Elliot Jacque’s
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 651
209. The rate at which people enter and leave 214. A job advertisement says “Only Chinese
employment in a business during a year. females should apply” for the job of a
Housekeeper. This criteria shows that the
PRACTICE BOOK» NOT FOR SALE
A. Layoff
advertisement is
B. Employee Turnover
A. equal employment opportunity
C. Discharge
B. discriminatory selection standards
D. Exit Interview
C. affirmative action
210. What are the soft skills? D. requiring a job related criteria
A. computer skills
215. Who suggested that Human Resource
B. knowledge of use of Microsoft Office Strategy isn’t as effective as it was sup-
C. marketing skills posed to be?
D. communication skills, teamwork skills, A. Tony Groundy
confidence, time management skills, and B. Peter Ducker
problem-solving skills
C. Anonymous
211. Below is the management demand of in- D. John Zimmerman
ternationalization EXCEPT:
216. Which of the following correctly defines
A. Ethinicity
the Human Resource Department?
B. Host-Country demand
A. Functional department
C. National-cultures and language
B. Service department
D. Geographical dispersion
C. Line department
212. A written statement of the human quali- D. Authority department
fication, education and experience needed
to perform a job is referred to as 217. Comments about a job applicant’s charac-
ter and qualifications for a job are called
A. Job design
a
B. Job enrichment
A. recognition
C. Job description
B. reference
D. Job specification
C. referral
213. The Americans with Disabilities Act D. resume
(ADA) prohibits discrimination against peo-
plewith disabilities in regard to all the fol- 218. A(n) is an evaluation of how well an
lowing services at ahotelexcept employee is doing a job
A. wide enough door entries A. exit interview
B. Line of credit B. orientation
C. employee privacy laws C. job description
D. national labor laws D. performance appraisal
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 652
219. BONUS:What percentage of the total dis- 224. the goal-oriented and integrated process
tribution is 3 sigma from the mean equal of planning, recruiting, developing, manag-
to? ing, and compensating employees
A. 68.25% A. job specifications
B. 95.46% B. job enlargement
C. 99.73% C. job analysis
D. 99.99966% D. talent management
NARAYAN CHANGDER
220. A type of job training in which one em- 225. Together pay and benefits are called
ployee teams up with another more expe- A. compensation
rienced employee to learn a job: B. profit sharing
A. delegating C. salary
B. interning D. wages
C. recruting
226. is the simple act of comparison &
D. mentoring learning for organisational improvement
221. Allocating challenging and stimulating re- A. Benchmarking
sponsibilities to employees. Employee de- B. Feedback
velopment plans to help employees reach
C. Ranking
their potential in the workplace. Relates
to which level of the hierarchy of needs. D. Job evaluation
A. Self actualisation 227. All of the following are forms of power
B. Physiological derived from the project manager’s posi-
tion except:
C. Social
A. Formal
D. Esteem
B. Reward
222. Which of the following is NOT a task of C. Penalty
the Human Resource Planning?
D. Expert
A. Recruitment
228. Management succession planning is
B. Retention sometimes called as:
C. Payment of wages or salaries A. Management hierarchy
D. Dismissal B. Executive succession
223. Which of the following is the first phase C. Fibonacci sequence
of HR activities for cross border M & A? D. None of the above.
A. Due diligence phase
229. What should be the strategy of HRM?
B. Pre-M & A phase
A. Making the long-term and short-term
C. Integration planning phase planning.
D. Implementation and assessment B. Planning the optimum level of man-
phase power.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 653
C. Introducing training programes to per- 235. A project manager had a complex prob-
sonnel lem to solve and facilitated a team deci-
sion about what needed to be done. A
PRACTICE BOOK» NOT FOR SALE
D. All of the above
few months later, the problem resurfaced.
230. Anything that can be used to satisfy hu- What did the project manager most likely
man needs is a: not do?
A. Perform proper risk analysis
A. Thing
B. Confirm the decision solved the prob-
B. Resource
lem
C. value C. Have the project sponsor validate the
D. Utility decision
D. Use an Ishikawa diagram
231. a type of behavioral method in employee
training 236. Which term refers to teaching several em-
A. team-building ployees in a class?
A. on-the-job-training
B. on-the-job training
B. Group-training
C. role-playing
C. human resource management
D. lecture and discussion
D. recruitment
232. Which are forms of recruitment?
237. Which task in the staffing process en-
A. internal sures that employees are knowledgeable
B. national and productive?
A. Training and developing
C. bridging
B. Developing compensation plans
D. external
C. Determining need
233. Which is not a current trend impacting on D. Recruiting
the HR environment?
238. hired for the business activities deemed
A. Globalisation
necessary in the employer’s usual business
B. Unions
A. casual
C. Diversity and inclusion in the work- B. regular
place
C. probationary
D. Changes in nature of work
D. project
234. All of the following are examples of hu- 239. A possible and desirable future state of
man resource specialties EXCEPT an organization is called
A. job analyst A. Vision
B. financial advisor B. Mission
C. compensation manager C. Strategy formulation
D. labor relations specialist D. Strategy implementation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 654
240. Which life insurance is very cheap for Em- 245. Breaking rules might lead to an employee
ployees? being fired or
A. Employee’s state insurance A. downsized
B. Group life insurance B. terminated
C. Individual life insurance. C. laid off
D. old age life insurance. D. praised
NARAYAN CHANGDER
246. The role of HR director is
241. The To-Complete Performance Index
(TCPI) is used to determine? A. solving the disputes
A. When the project would be complete B. Extension of plan
B. The feasibility of the project C. Administration
C. The risks in the project D. Training and development
D. The cost performance required to 247. What is part of the planning stage of HR
meet certain objectives management?
A. Working out profits
242. Quality-driven leadership leads to
B. Creating a wage analysis
A. unhappy employees
C. Conducting interviews
B. break down of the team
D. Figuring out how many staff I need for
C. employee layoffs the business and what each staff member
D. a competitive edge needs to do
243. What is the main purpose of human re- 248. The process by which managers design
source management? the components of a HRM system to be
consistent with each other, with other el-
A. to ensure people employed in an orga- ements of organizational architecture, and
nization are being used to the fullest po- with the organization’s strategy and goals
tential for achieving company goals and
objectives A. Strategic HR Management
B. Digital Dashboard
B. to pay wages
C. strategy based metrics
C. to build the nation
D. strategic management
D. to enable employees to work in a free
environment and protect their rights 249. The process of identifying the needs of
new employees, determining the jobs to
244. metrics that specifically focus on measur- be filled and the types of people needed
ing the activities that contribute to achiev- to fill them, and attracting suitable candi-
ing a company’s strategic aims dates for the jobs, is referred to as?
A. strategy based metrics A. Employment contract
B. strategic management B. Recruitment
C. corporate strategy C. Person specification
D. functional strategy D. Job description
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 655
250. Which of the following is the main objec- 255. The result of the translation of termina-
tive of HR planning in the organization? tion of employment due to something that
results in the termination of the rights and
PRACTICE BOOK» NOT FOR SALE
A. To attract and retain talented staff
obligations between the worker/laborer
B. To deliver the best possible services and the entrepreneur/employer, is re-
C. To fulfill the many roles within the de- ferred to as?
partments
A. Employment Contract
D. To have an accurate number of employ-
ees required, matching skill requirement B. Dismissal
to accomplish organizational goals C. Training
251. Which one of the following includes D. Selection
five basic functions-planning, organizing,
staffing, leading, and controlling? 256. The function of human resource manage-
A. a job analysis ment has been increased in the last 50
years. Most of these changes include:
B. strategic management
C. the management process A. introduction of legislation to protect
workers and their rights
D. adaptability screening
B. changes in economic and social envi-
252. The project is just starting out. The ronment
project manager has just been hired.
Which of the following types of project C. the growth in the size of organization
management power will best help the D. to make sure the workers is eating
project manager gain the cooperation of healthy
others?
A. Formal 257. The sponsor’s role on a project is BEST
described as:
B. Referent
C. Penalty A. Helping to plan activities
D. Expert B. Helping to prevent unnecessary
changes to project objectives
253. Which of the following is the highest
point of Maslow’s hierarchy of needs: C. Identifying unnecessary project con-
straints
A. Physiological satisfaction
D. Helping to put the project manage-
B. Attainment of survival
ment plan together
C. Need for association
D. Esteem 258. A new member of staff being mentored
by an existing member of staff is an ex-
254. Career development falls into which AMO ample of
category?
A. systems training
A. Skill-enhancing
B. Motivation-enhancing B. induction training
C. Opportunity-enhancing C. staff retention
D. None of the above D. apprenticeships
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 656
259. an organizational strategy for how an or- 264. Employee’s general belief that their or-
ganization will compete in its business(es) ganisation values their contribution and
A. strategic plan cares about their well-being is called
B. vision statement A. Behaviour
C. competitive strategy B. Workplace misbehaviour
D. competitive advantage C. Organizational behaviour
260. Expansion, downsizing and staff D. Perceived organizational support
NARAYAN CHANGDER
turnover are factors affecting employ-
ment 265. Manpower planning consists of-
A. Operational A. determining the jobs to be done / iden-
B. Internal tifying the skills / estimating the exists
likely / filling up the requirements
C. External
B. identifying the skills
D. Financial
C. Estimating the turnover of employees
261. Which is the process of helping new em- likely to happen in near future
ployees adjust to a company?
D. none of above
A. training
B. recruitment 266. The function of human resource is
C. human resource management A. irrespective
D. orientation B. pervasive
262. If you hear a project manager saying to C. not essential
a customer “We all agree that this project
is important. Let’s not fight over a few D. none of above
thousand dollars, “ what conflict resolu-
267. the systematic shifting of employees
tion technique is the project manager try-
from one job to another
ing to use?
A. Smoothing A. job analysis
B. Problem Solving B. job description
C. Forcing C. job description
D. Compromising D. job rotation
263. This is the management process that con-
268. presents the manager with desktop
sists of all the activities involved in ac-
graphs and charts, and so a computerized
quiring, developing, and compensating the
picture of where the company stands on all
people who do the work of the small busi-
the metrics from the hr scorecard process
ness.
A. digital dashboard
A. Organizational Management
B. Industrial Management B. corporate strategy
C. Human Resources Management C. Mission statement
D. Authority Management D. competitive advantage
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 657
269. Ineffective planning of workforce would C. talent management
be highlighted by D. job enlargement
PRACTICE BOOK» NOT FOR SALE
A. recruitment and selection problems
274. Interview Question:What changes have
B. The need to out source some of the you made in working with others to be
production moreeffective at work? This question will
C. A need to offer retraining to current help the interviewer to learn more about
employees. thecandidate’s
D. An opportunity to increase the use of A. professional characteristics
mechanization. B. team skills
270. Involves a series of steps in which C. goals for the future with the company
candidates are interviewed, tested, and D. dedication to completing a project
screened to select the most suitable per-
son for the vacant position, called? 275. Which is considered a voluntary separa-
tion?
A. Training
A. transfer
B. Selection
B. lay off
C. Labor turnover
C. retirement
D. Employment Contract
D. resignation
271. Which is an evaluation of how well an
employee is doing a job? 276. is a compensation arrangement in
which employees are paid a portion of the
A. job description company’s profits.
B. performance appraisal A. supervisors
C. reference B. salaries
D. orientation C. wages
272. The theory of justice explains that there D. Profit sharing
is a balance between their contribution
277. Which of the following is a characteristic
to work and the benefits they get from
of human resources management?
it with comparable contributions and
(comparison others) A. Evaluating supervisors
A. The advantage over others B. Scheduling the work
B. Incentives received C. Working with people
C. Wages received D. Developing leaders
D. Accepted facilities 278. Which term means actively looking for
qualified employees?
273. the procedure for determining the duties
and skill requirements of a job and the kind A. background check
of person who should be hired for it B. recruitment
A. job analysis C. human resources management
B. job rotation D. meeting staffing needs
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 658
279. A wage is an amount of money paid to A. explain the atmosphere in which the
an employee on a(n) basis job applicant would work
A. hourly B. talk about the significance of working
B. weekly at a new business
C. monthly C. avoid ruling out a job applicant until
the interview is over
D. yearly
D. refuse to allow the candidate to ask
NARAYAN CHANGDER
280. The process of helping new employees ad- questions
just to a company is called
285. The process of verifying certain informa-
A. coaching tion provided by a job applicant is called a
B. on-the-job training check
C. continuing education A. background
D. orientation B. credibility
C. personnel
281. Which tactic allows you to choose what
hours to work as long as they complete D. reference
their tasks?
286. With Internet technology, we have the
A. Job sharing capability to connect in real-time with peo-
B. Flextime plans plefromall over the world using a
C. Home based work A. corporate meeting
D. Compressed work week B. professional conference
C. skills seminar
282. An amount paid for a job position stated
on an annual basis is called a: D. webinar
A. bonus 287. Following are the operative functions of
B. commission HRM:
C. wage A. Recruitment & Selection
D. salary B. Learning & Development
C. Organising
283. Your project requires an electrician at
month eight. This is an example of which D. Talent Retention
of the following? E. Supervising
A. Resource requirements
288. The success HRM of any organisation de-
B. Contractor requirements pends on the ability to
C. Resource constraints A. search for new technology
D. Organizational interfaces B. managing diversity to produce innova-
tive and creative ideas.
284. A small business owner should do all of
the following when interviewing job candi- C. focus on work flow
dates EXCEPT: D. cross bother business
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 659
289. What is the main objective of job evalua- 294. To look for people to hire and attract
tion? them to a business:
PRACTICE BOOK» NOT FOR SALE
A. It is not compulsory A. delegate
B. To define satisfactory wage and salary B. mentor
differentials
C. freelance
C. Job is rated before the employee is ap-
D. recruit
pointed to occupy
D. None of the above 295. As per Maternity Benefit Act 1961, a
women worker can get maternity leave up
290. What should the company do when one to
of the employee’s performance fall?
A. twenty-six weeks
A. Firing them
B. twelve weeks
B. Discipline the employees
C. four months
C. Employees counseling
D. sixteen weeks
D. Embarrassing employees among other
employees 296. Which of the following is the equity
modes of foreign operation?
291. personnel manager collects and maintains
information concerned with the staff of the A. Franchising
organization B. Subsidiaries
A. Personnel Planning and Evaluation C. Management Contracts
B. Record Keeping D. Licensing
C. Maintaining Good Industrial Relation
297. During the initial startup of the new busi-
D. Development of Personnel
ness venture, who will be responsible for
292. Recruitment is a negative process the human resources management function
whereas selection is a positive one of the new business?
A. The above statement is correct A. the entrepreneur
B. It should be the other way round B. the accountant
C. It could be both C. the personnel department
D. It depends on the profile for which a D. the venture capitalists
company hires
298. Personnel activities associated with hu-
293. Which aptly describes the core functions man resource management most likely in-
of HR in the correct sequence clude all of the following EXCEPT
A. Hire, Attain, Train A. orienting and training new employees
B. Train, Hire, Retain B. appraising employee performance
C. Hire, Attain, Retain C. building employee commitment
D. Hire, Train, Retain D. developing customer relationships
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 660
299. The general level of confidence or enthu- C. Selection and recruitment
siasm felt by a person or group of people D. Termination
is called
A. euphoria 304. Below is the role of HR in M & A EXCEPT:
B. satisfaction A. Maintaining the productivity by placing
of right people at right place
C. morale
B. Alignment of compensation, benefits
D. self actualization and welfare schemes
NARAYAN CHANGDER
300. A key benefit of a firm investing in train- C. Company sale forecat
ing is that D. Organizational hierarchy structure
A. production capacity is lowered
305. concerned with the obtaining of the
B. employees need more supervision
proper kind and number of personnel nec-
C. employee skills are enhanced essary to accomplish organizational goals
D. cash flow improves A. Procurement of Personnel
301. Project performance appraisals are differ- B. Development of Personnel
ent from team performance assessments C. Compensation to Personnel
in that project performance appraisals fo-
D. Maintaining Good Industrial Relation
cus on:
A. How an individual team member is per- 306. is the number of employees who
forming on the project leave an organization and are replaced
over time
B. An evaluation of the project teams ef-
fectiveness A. head count
C. A team-building effort B. substitution
D. Reducing the staff turnover C. rotation
D. turnover
302. Which term describes the process of ana-
lyzing and identifying the needs and avail- 307. Supervisors might use this to prevent
ability of HR required by an organization boredom, keep morale high and teach a va-
to meet its objectives? riety of work experiences
A. Recruitment and Selection A. job rotation
B. Human Resource management B. performance appraisal
C. HR Planning C. orientation
D. Strategic human resource manage- D. separation
ment
308. Which of the following is the output of
303. Which of the following is NOT one of the Human Resource Plan?
main objectives of HR management?
A. Enterprise Environmental Factors
A. Ensuring productivity
B. Role and Responsibility assignments
B. Implementation of policies and proce-
dures to ensure that the business is com- C. Organizational Process Audits
pliant with legislation D. Activity Resource Requirements
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 661
309. Which of the following fields requires a C. Human resource Machine
skilled HR professional? D. none of above
PRACTICE BOOK» NOT FOR SALE
A. People handling
315. The process of analyzing jobs from which
B. Clarifying
job descriptions are developed are called
C. Both (a) and (b}
D. None of the above A. Job analysis
310. Human factor can be defined as B. Job evaluation
A. The entire concept of human behavior C. Job enrichment
B. Interrelated Physiological, Psychologi- D. Job enlargement
cal and Socio-ethical aspects of a human
being. 316. In this, the process that comes first will
be executed first and next process starts
C. Micro and macro issues of socioeco- only after the previous gets fully exe-
nomic factor cuted.
D. None of the above
A. First-come, first-serve
311. Which of the following is NOT one of the B. Shortest-job-first scheduling
Four Leadership Styles?
C. Round-robin scheduling
A. Director
D. Priority scheduling
B. Mentor
C. Facilitator 317. Placing the right man for the right job is
an example of
D. Supporter
A. Jo Description
312. The provides the essential informa- B. Job Specification
tion on which each job is evaluated.
C. Job Analysis
A. Job ranking
D. Job Portfolio
B. Job enrichment
C. Job description 318. Which of the following is the correct ab-
breviation of HRM?
D. Job enlargement
A. Human Resource Management
313. can be defined as a written record of
the duties, responsibilities and conditions B. Human Resourcefulness Management
of job. C. Human Relation Management
A. Job description D. Humanistic Relation Management
B. Job specification
319. All of the following are resources an en-
C. Job profile trepreneur can use for recruiting except:
D. None of the above A. employment agencies
314. HRM stands for B. in-store advertising
A. Human resource Maintenance C. classified/online ads
B. Human resource Management D. all of the above can be used
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 662
320. HR department will check other depart- 325. The following is (are) included in salary
ments and the organization as a whole to survey.
ensure all HR policies are being carried out A. Average salary
in accordance with the company HR policy.
B. Inflation indicators
A. Executive Role
C. Salary budget averages
B. Service Role
D. All of the above
C. Audit Role
NARAYAN CHANGDER
D. Facilitator Role 326. Efficient and effective utilization of a
number of individuals and can be used op-
321. Qualification, Experience, Training and timally to achieve organizational or com-
Certification will fall under the umbrella of pany goals are referred to as
A. Job Description A. Human Resource Management
B. Job Specification B. Job description
C. Job Evaluation C. Person specification
D. Job Monitoring D. Employment contract
322. Which of the following is not a part of Na- 327. BONUS:Which of the following is not true
tional Employment Standards (NES) under about TQM:
the Fair Work Act 2009?
A. States that everyone in the company is
A. Flexible working arrangements responsible for quality
B. Hours of work B. Applies to improvements in both pro-
C. Promotion cesses and in the results
D. Maternity leave C. Stresses constant process improve-
ment
323. are payments for labor or services
that are made on an hourly, daily, or per- D. Shifts the focus away from the product
unit basis. and looks at the underlying process
A. salaries 328. During project planning in a matrix or-
B. benefits ganization, the project manager deter-
mines that additional human resources are
C. Wages
needed. From whom would he request
D. stocks these resources?
324. A job analysis results in two written A. Project manager
statements. Theses statements are: B. Functional manager
A. human resource inventories and affir- C. Team
mative action statement
D. Project sponsor
B. labor supply assessment and labor de-
mand assessment 329. Which of the following best describes Hu-
C. job description and job specification man Resource?
D. job title review and performance ap- A. Personnel
praisal B. Knowledge
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 663
C. People 335. Glass ceiling refers to
D. skills A. Moderate difficulties in training of
PRACTICE BOOK» NOT FOR SALE
women workforce
330. What is the definition of a wage?
B. Artificial barriers based on attitudinal
A. a fixed amount of pay for each week, and organizational bias preventing career
month, or year growth of women
B. extra compensation C. Personality weaknesses hindering ca-
C. A profit sharing plan reer growth of women
D. an amount of money paid on an hourly D. Transperency at higher levels in organ-
basis. isation
331. A process of self-evaluation and evalua- 336. The most important role of the project
tions by a manager, peers, direct reports, sponsor is to:
and possibly customers. A. Manage and resolve conflicts between
the team and upper management
A. written essay
B. Provide and protect the project’s finan-
B. 360-degree Feedback
cial resources
C. multi person
C. Provide and project the project’s hu-
D. MBO man resources
332. Which of the following terms refers to D. Balance the project’s constraints re-
training and evaluating of employees? garding time, scope, and cost
A. hiring and firing 337. What is the FINAL step in the appraisal
B. employee orientation process?
A. Discussing the appraisal with the em-
C. human resources management
ployee
D. job description
B. Examining the work performance of
333. Which of the following is a challenge the employee
faced by human resource managers in the C. Appraising the work performance of
modern era? the employee
A. Lack of diversity D. Communicating the performance crite-
B. Resistance to change ria to the employee
C. Limited technology 338. The historical rule of the HRM is
D. Inefficient recruitment process A. One HR person for 100 employees
B. One HR person for 50 employees
334. Which is the process of finding, selecting,
training, and evaluating employees? C. One HR person for 25 employees
A. orientation management D. One HR person for 10 employees
B. supervising workers 339. What is MNE?
C. performance appraisal A. Multinational Entrepreneur
D. human resources management B. Multinational Executive
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 664
C. Multinational Enterprise 345. The chain of command shows:
D. Multinational Expatriate A. who has been working at the company
the longest
340. The process of forecasting an organiza-
tions future demand for, and supply of, the B. the physical layout of a store or busi-
right type of people in the right number is ness
called C. who reports to whom in the company
A. Recruitment D. the salaries of all company employees
NARAYAN CHANGDER
B. Human Resource Planning 346. How has HRM become one of the highly
C. Human Capital Management focused jobs?
D. Human Resource Management A. It focuses on obtaining as well as main-
taining a satisfied workforce.
341. HRP is
B. It results in maximum output with the
A. Human Resource Performance increased customer satisfaction.
B. Human Recruitment Planning C. It promotes group satisfaction with in-
C. Human Resource Planning dividual development.
D. Human Resource Protection D. Optimum utilization of manpower by
motivation and improving efficiency.
342. This is an opportunity to learn about the
causes of employee turnover. 347. The activity that presents a prime oppor-
A. Exit Interview tunity to expand the knowledge base of
all employees is
B. Discharge Interview
A. promotion
C. Layoff Interview
B. workplace training
D. Employment Interview
C. retention
343. The termination technique where there is D. union participation
no longer a position for an employee is
called 348. The final process of a job analysis is the
A. redundancy-voluntary preparation of two statements, namely,
B. redundancy-involuntary A. job observation and job description
C. retrenchment B. job specification and job observation
D. resignation C. job description and job specification
D. None of the above
344. Lean manufacturing is when
A. We design and make things smaller 349. Which of the following is NOT one of the
four steps in selecting the right candidate
B. We design and make things to be bet- for the job?
ter at assembly
A. compensation
C. We design and make things to reduce
waste B. interview
D. We design and make things that look C. application
thin D. testing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 665
350. The combination of peer, superior, subor- C. compensation manager
dinate and self-review appraisal is known D. job analyst
as
PRACTICE BOOK» NOT FOR SALE
A. 360◦ appraisal 355. An introductory training program to fa-
miliarize new employees with the systems
B. Human resource accounting system used in the business and the layout of the
C. All round review business location, referred to as?
D. Feed forward A. Induction Training
351. Which of the following are not environ- B. Selection
mental influences? C. Labor turnover
A. Technology D. Employment Contract
B. Globalization
356. Which statement(s) refer to Theory X?
C. Labor force trends
A. Every employee loves to work
D. Employee concerns
B. Humans need directions
352. The advantages of the 360-degree eval- C. Employees need to be controlled
uation are
D. Human beings can learn to see respon-
A. The system is more comprehensive sibility
and responses are gathered from multiple
perspectives. 357. Below are the other names for HRM spe-
B. Quality of information is better cialist, except
C. It may lessen bias/ prejudice since A. human capital manager
feedback comes from more people, not B. welfare officer
one individual. C. personal officer
D. Feedback from peers and others may
D. human resource manager
increase employee self-development.
358. Developing characteristics of people are
353. brain drain means
needed to run business in
A. the emigration of highly trained or
A. Short term
qualified people from a particular country
to other countries B. Medium term
B. draining resources of the company C. Long term
C. stealing of important information D. All of the above
D. none of above 359. Systematically identifying tasks, duties,
354. Wilmer works in the HR department and and responsibilities expected to be per-
is in charge of developing the plans for formed in a job as well as the competen-
how people are paid and how the em- cies employees must possess to be success-
ployee benefits program is run. Wilmer is ful?
most likely holding the position of A. Workforce planning
A. training specialist B. Job description
B. recruiter C. JOb specifications
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 666
D. Job analysis 365. The staffing function is different from the
E. KSA’s organizing function because staffing is:
A. more important than organizing.
360. The provision of allowances to employ-
B. continuous.
ees by the company is an award given in
relation to C. the foundation of organizing.
A. Membership in the company D. optional.
NARAYAN CHANGDER
B. Loyalty to the company 366. This qualitative approach avails of the
C. Always on-time attendance opinion of department managers on their
future staffing needs.
D. Performance of one department within
A. Statistical approach
the company
B. Judgmental approach
361. The status give to an employee based on
C. Both statistical and judgmental ap-
rank or length of service is called
proaches
A. longevity D. None of the above
B. seniority
367. Which of the following is NOT one of the
C. priority Five Types of Power?
D. superiority A. Legitimate
362. What conflict resolution technique is a B. Punishment
project manager using when he says, “I C. Deferent
cannot deal with this issue now!” D. Referent
A. Problem solving
368. The amount employees are paid in money
B. Forcing and benefits is termed as?
C. Withdrawal A. wages
D. Compromising B. benefits
363. What is induction training? C. salary
D. Compensation
A. off the job training for part timers
B. training for new directors 369. What are those aspects on which the HR
professionals apply the risk management
C. training for new employees
techniques?
D. on the job training for managers A. HR CompetenciesBoth (a) and (b)
364. a detailed study of the flow of work from B. HR Strategies
job to job in a work process C. Both (a) and (b)
A. talent management D. None of the above
B. job analysis
370. Which term refers to learning a new job
C. process chart by doing it?
D. workflow analysis A. orientation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 667
B. job shadowing 376. A process that is used for identifying and
C. reference developing internal people with the poten-
tial to fill key business leadership posi-
PRACTICE BOOK» NOT FOR SALE
D. on-the-job-training tions in the company is called
371. (or independent contractors) are peo- A. Succession planning
ple who provide specialty services to B. Investing in human resources
a number of different businesses on an
C. Highly talented personnel creation
hourly basis or by the job.
D. None of the above
A. Freelancers
B. students 377. Human resources are a company’s most
important resources because:
C. supervisors
A. they are the least expensive re-
D. managers sources.
372. Bonus Act was passed in the year B. they control all other company re-
sources.
A. 1968
C. they are controlled by other company
B. 1966 resources.
C. 1969 D. they are the most expensive re-
D. 1965 sources.
373. Type of pay system where the wage is 378. Which is an internal method of recruit-
based on the number of items and em- ment?
ployee produces in day. A. Job centre
A. Produce pay B. Notice board
B. Piecework C. Newspaper
C. Salary D. Testing
D. Bonus plan 379. On-boarding is associated with
374. Which of the following refers to how A. Career Planning
much a job pays and the benefits offered? B. Induction
A. minimum wage C. Relocation assistance
B. compensation D. formal training
C. promotion 380. Organisations of the 21st century require
D. wage
A. effective production of new products
375. The following type of recruitment process
or services
is said to be a costly affair.
B. a skillful and flexible workforce
A. Internal recruitment
C. effective selections tools and models
B. External recruitment
to secure staff
C. Cost remains same for both types D. a rational and ‘scientific management’
D. none of above approach to managing people
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 668
381. What are the disadvantages for workers 386. Type of pay plan where an employee re-
at work? ceives a percentage of their sales.
A. They will earn less than full-time work- A. salary
ers B. piece rate
B. They may be paid a higher rate than C. bonus
full-time workers
D. commission
C. Job security and other working condi-
NARAYAN CHANGDER
tions are higher than full-time workers 387. Who was Abraham Maslow?
D. Employees may be required to work A. Teacher
very flexible day periods during slower pe- B. Philosopher
riods
C. Human Resource Manager
382. Which of the following is not a recruit- D. Physiologist
ment methods used by HRM to recruit
qualified employees 388. Human Resource Management involves
the functions:
A. Internal recruitment
A. planning, controlling
B. External recruitment
B. planning, organising, staffing, leading
C. Non of the above and controlling
D. none of above C. marketing, staffing and leading
D. staffing, organising and promoting
383. Every action of hrm is directed towards
the accomplishment of 389. McClelland’s Three need Theory states
A. Targets that employees are motivated by all but
one of the following:
B. HRM goals
A. Acceptance
C. organizational goal
B. Achievement
D. none of the above
C. Affiliation
384. The scope of HRM doesn’t include D. Power
A. Separation 390. . In today’s competitive market condition
B. Outsourcing HR department needs to act as to the
management
C. Promotion
A. Controller
D. Market entry
B. friend
385. Individual who make up the workforce of C. Customer
an organization.
D. Business partner
A. Human Resource
391. Offering an employee the opportunity to
B. Human Resource Management
participate in a group health insurance plan
C. Human Resource Development is an example of a:
D. none of above A. wage
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 669
B. salary 397. Basis of Job evaluation is
C. bonus A. Job design
PRACTICE BOOK» NOT FOR SALE
D. benefit B. Job ranking
392. A temporary or permanent reduction in C. Job analysis
the number of employees because of a D. Any of the above
change in business conditions.
398. If you are using the recruitment approach
A. Layoff
to deal with a labour shortage you must
B. Employee Turnover first be certain that
C. Discharge A. recruitment is done as speedily as pos-
D. Exit Interview sible
393. Which of the following is NOT considered B. your benefits package will meet the
as a compensation? needs of your growing workforce
A. Salary C. the shortage is a long term issue
rather than just a temporary problem
B. Company car
D. overtime will not continue to be used
C. Wage
D. Benefits 399. An approach to management that gives
employees the authority to solve many
394. this type of employee is hired for busi- customer problems.
ness activities which are deemed inciden-
A. Unity of Command
tal to the business
B. Organization Chart
A. term
C. Employee Empowerment
B. project
C. casual D. Accountability
D. probationary 400. To improve employee productivity, which
of the following activities is involved in
395. What are human resources? outsourcing analyses?
A. food A. Revising the organizational structure
B. money
B. Using external vendors instead of em-
C. employees ployees
D. management C. Changing workloads and combining
jobs
396. a process that involves managers from all
parts of the organization in the formula- D. Attracting and retaining employees
tion and the implementation of strategies
and strategic goals 401. This is the management function of ar-
ranging people, activities, and resources
A. Strategic HR Management to accomplish the goals of the small busi-
B. strategy based metrics ness.
C. strategic management A. Organizing
D. corporate strategy B. Investigating
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 670
C. Inspecting 407. Differentiation between line and staff
D. Planning functions is necessary because it helps in
A. providing specialized services
402. What are the guides to decision-
making? B. maintaining adequate checks and bal-
ances
A. Procedures
C. maintaining accountability
B. Rules
D. All the above
C. Policies
NARAYAN CHANGDER
D. Goals 408. Manpower planning takes into account
staffing needs in terms of
403. Syakil, a manager, delegates the author- A. Quantity and nothing else
ity for a project to Lee, her subordinate.
Consuela is most likely involved in which B. Quantity and quality
function of the management process? C. closeness of the work place and home
A. staffing
B. organizing D. none of above
C. motivating 409. John is paid piece rates. What does this
D. leading mean?
A. He is paid according to how much time
404. What can happen if the employees of is worked
the new business are unhappy and unmo-
tivated? B. He is paid according to how much out-
put is made
A. The business could make more money.
C. He is paid according to how many
B. The business could lose money and items are sold
fail.
D. none of above
C. The business could make customers
happy. 410. An effective performance appraisal sys-
D. The business could borrow more tem should do all of the following EXCEPT
money.
A. identify and correct employees’ weak-
405. Induction is viewed as ness
A. Feel at home B. reinforce employees’ strengths
B. Belongingness C. emphasise employees’ personality
C. Socializing process characteristics
D. All the above D. plan work and set expectations
406. Which of the given options below the 411. Which of the following is an evaluation
forecasting technique used? of how well an employee is doing?
A. Estimation A. recruitment
B. Rules of thumb B. compensation
C. Staffing projections C. group training
D. All of the above D. performance appraisal
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 671
412. As part of Tuckman’s Ladder of Team- B. manager
work Development, which of the following C. labor relations specialist
best describes the ‘Norming’ level of per-
PRACTICE BOOK» NOT FOR SALE
formance? D. job analyst
A. The team understands the project and 417. Which of the following leadership traits
their roles is MOST important for a project man-
B. The team begins to do the work ager?
C. The team begins to work as a team A. Communication
D. The team is working at an efficient B. Team building
level that exceeds what individuals could C. Technical expertise
accomplish D. Project control
413. a plan of action the company can pursue 418. One of the function of the HRM process
to achieve its strategic aims is
A. HR audit A. Selecting, training and evaluating the
B. strategic management work force.
C. strategy B. Ensuring that competent employees
are identified and selected.
D. strategy based metrics
C. HRM helps establish an organization’s
414. All of the following are resources an en- sustainable competitive advantage.
trepreneur can use for recruiting EXCEPT
D. none of above
A. in-store advertising
419. Sports Events company recently saw de-
B. classified advertisements
mand for their services drop significantly.
C. employment agencies To manage the labour situation in the com-
D. all of the above can be used as recruit- pany, Sports Events should do all of the
ing resources following EXCEPT
A. offer early retirement options
415. A list of a job’s duties, responsibili-
ties, reporting relationships, working con- B. transfer employees to another branch
ditions, and supervisory responsibilities- or outlet
one product of a job analysis. C. hire temporary employees
A. job specifications D. lay off/retrench employees
B. job enrichment 420. An independent federal agency that ad-
C. job desription ministers the basic law governing rela-
D. job analysis tions between labor unions and the em-
ployers, whoseoperations influence inter-
416. Yuna works at a position in his organi- state commerce, is the
zation where he maintains contacts within A. Affirmative Action Law
the local community and travels to search
for qualified job applicants. Yuna’s posi- B. Equal Pay Act
tion is best described as C. Collective Bargaining Process
A. recruiter D. National Labor Relations Board
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 672
421. Workforce planning involves all the fol- B. get a list of referees
lowingexcept C. achieve person-organisation fit
A. organizing the training of staff
D. confirm the age and race of the appli-
B. orecasting future personnel require- cant
ments
C. examining production plans in a fac- 426. Which of the following would be the most
tory effective training method to use for an em-
ployee who needs to learn about the latest
NARAYAN CHANGDER
D. preparing and maintainingpersonnel technology trends for today’s modern of-
records fice?
422. A(n) gives an employee a higher- A. on-the-job training
level job with more authority, responsibil- B. coaching
ity, and pay
C. mentoring
A. evaluation
D. conference or seminar
B. raise
C. promotion 427. Which stage of human resource manage-
D. transfer ment is characterized by the use of person-
nel specialists?
423. An agreement between the worker and A. Modern Stage
the entrepreneur orally and or in writing,
either for a certain time or for an indefinite B. Transformational Stage
period of time which contains the terms of C. Traditional Stage
work, rights, and obligations referred to
D. Pre-Industrial Revolution Stage
as?
A. Employment Contract 428. A collection of tasks and responsibilities
B. Labor turnover that an employee is responsible to conduct
is a:
C. Training
A. job
D. Selection
B. job description
424. an advantage over competitors gained by
C. job analysis
offering greater customer value, either by
having lower prices or providing more ben- D. duties and task list
efits that justify higher prices
429. When was The art and science of man-
A. strategic management
power management has developed and it
B. competitive advantage was began to be recognized in the Philip-
C. Human Resource Metrics pines are the science of administering peo-
ple at work.
D. corporate strategy
A. 1950
425. An important purpose of a selection inter-
B. early 1950’s
view is to
A. fill up the information in an application C. 1960
form D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 673
430. the process of attracting applicants qual- 435. A detailed outline of the duties, qualifica-
ified to occupy vacant positions tions, and conditions required to do a spe-
cific job is called a
PRACTICE BOOK» NOT FOR SALE
A. recruitment
B. selection A. background check
C. placement B. job application
D. retirement C. job description
D. resume
431. The department responsible for anticipat-
ing future staffing needs of an organisa- 436. Human Resources are:
tion is
A. Human Resources are the jobs in a
A. HR Planning business.
B. HR Strategy B. Human Resources are the people, in-
C. HR Marketing cluding their skills, knowledge and abili-
D. HR Recruitment ties, who comprise an organisation.
C. Human Resources are the skills,
432. Under Act covers all workers em- knowledge and abilities of an organisa-
ployed in factories, mines, plantations, tion.
transport undertakings, and construction
works. D. Human Resources are the groups of
people in the organisation.
A. ESI Act
B. Industrial disputes Act 437. Sharon gives Adrian high performance
evaluation ratings because she thinks that
C. Indian Factories Act
he is handsome. Which error has Sharon
D. The Workmen’s Compensation Act, of committed?
1923
A. Strictness
433. The basic functions of the management B. Contrast
process include all of the following EXCEPT
C. Horn
A. planning
D. Personal bias
B. organizing
C. outsourcing 438. Human Resource Planning include
D. leading A. Scenario planning
B. Action planning
434. What does the term ‘human resource
management’ describes? C. Demand and Supply forecasts
A. concept of competing through techni- D. All the above
cal resources in organisations
439. These are the most important resource of
B. economic value of employees’ knowl- any small business.
edge, skills and capabilities
A. suppliers
C. policies and practices involved in man-
aging managers of an organisation B. employees
D. effective utilisation of an organisa- C. vendors
tion’s people and their talent D. consultants
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 674
440. types of recruiting sources are 445. movement to a higher level or position
A. Internet sources A. demotion
B. Internal sources B. promotion
C. Employee referrals C. transfer
D. External sources D. termination
446. Which security is essential for the Labour
441. When a company is looking for employ-
force?
NARAYAN CHANGDER
ees, this is called:
A. Social
A. Training
B. Individual
B. Recruiting
C. Employment
C. Interviewing
D. old age
D. Compensation
447. Job Specification is a statement of
442. The process of collecting and analyzing in- A. Minimum qualification required for a
formation to determinethetrainingrequire- job
mentsthat would enable atarget groupof B. Technical job requirement
employees to meet orexceed the perfor-
mancerequirements of their roles within C. Machines to be used
the organization is called a D. None of these
A. job organization 448. You must treat your employees with re-
B. job description spect and dignity-Quoted by
C. needs assessment A. Dhirubai Ambani
D. job evaluation B. Bill Gates
C. Warron Buffet
443. Which of the following is one of the chal- D. Narayana Moorthy
lenges in finding high-level workers:
449. Which is an example of an ethical
A. Too many workers in skilled trades
dilemma that human-resources managers
B. Decreasing benefit demands and ben- may encounter?
efits costs
A. Recruiting job candidates online
C. A decreased sense of employee loyalty B. Promoting a qualified employee
D. A shortage of trained workers in key C. Hiring a friend and family member
areas
D. Developing a pay scale for employees
444. Determining the number of employees 450. Which of the following components are
you need and defining a process for hiring reformed to support the strategies of hu-
them is called man resource function?
A. hiring A. Control systems
B. staffing B. Appointment
C. tasking C. Rewards
D. supervising D. Job allotment
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 675
451. Person-job fit could BEST be defined as: 456. There are HRM process.
A. employee satisfaction with the work, A. 8
PRACTICE BOOK» NOT FOR SALE
wages and benefits offered
B. 9
B. a good match between an employee’s
C. 10
KSAOs and the job requirements
D. 11
C. an employee’s understanding of the
job description and what is expected of 457. The movement to a higher level or posi-
him tion is referred to as?
D. a steady increase of labour turnover in A. Demotion
a particular time period
B. Transfer
452. Which one does NOT belong on a person C. Promotion
specification?
D. Termination
A. Pay
B. Skills 458. redesigning jobs in a way that increases
the opportunities for the worker to ex-
C. Qualifications perience feelings of responsibility achieve-
D. Experience ment growth and recognition
A. job enrichment
453. Safety in the workplace is required by
B. job analysis
A. National Labor Relations Act C. job enlargement
B. OSHA laws D. job specifications
C. Employee Privacy Laws 459. daily listings made by workers of every
D. National Labor Laws activity in which they engage along with
the time each activity takes
454. Which one is not a part of recruitment
A. diary-log
process?
B. job analysis
A. Attracting candidates
C. job description
B. Selecting candidates
D. talent management
C. Determining requirements
D. Planning recruitment campaign 460. a strategic planning tool that shows the
big picture of how each departments per-
455. is a process that aims at rejecting un- formance contributes to achieving the com-
suitable candidates. panys overall strategic goals
A. job Training A. Human Resource Strategy Map
B. Job Evaluation B. corporate strategy
C. Selection C. Hr Metrics
D. Recruitment D. competitive advantage
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 676
461. Which of the following is an illegal ques- 466. HRM can be most comprehensively define
tion that should NOT be asked of a job ap- as a series of activities focused on
plicant?
A. working towards strong communica-
A. Why are you the best candidate for this tion with staff
position? B. obtaining, training and maintaining an
B. What is your greatest strength? effective workforce
C. Are you married? C. strong leadership
NARAYAN CHANGDER
D. Do you have questions for us? D. strategic planning
462. If hygiene factors are missing 467. The following are reasons why employ-
ees resign except:
A. employees become motivated
A. Misconduct
B. employees become dissatisfied
B. Migrating abroad
C. employees start to complain
C. Poor health
D. employees will do their best to achieve
the goals D. Accepting a job elsewhere
468. You are the project manager of the PUY
463. Employees work with an experienced
Project. This project requires a chemical
worker who provides information, support
engineer for seven months of the project,
and encouragement. This employee train-
but there are no available chemical engi-
ing method refer to
neers within your department. This is an
A. Workbooks/manuals example of which of the following?
B. On-the-job A. Organizational interfaces
C. Experiential exercises B. Resource requirements
D. Mentoring and coaching C. Contractor requirements
D. Resource constraints
464. Framework for the expansion of human
capital within an organization. 469. Maslow’s hierarchy of needs ranks needs
A. Human Resource A. in order of expense
B. Human Resource Management B. in order of importance
C. Human Resource Development C. in order of things we love
D. none of above D. in order of profit potential
465. employees whose services are needed 470. It ensures that the right people will be in
for a specific period only the right job at the right time.
A. permanent A. Human resource process
B. project B. Human resource planning
C. casual C. Organizational planning
D. term D. None of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 677
471. Employees can derive satisfaction from 476. What is the need for Human Resource
their work through the following non- Planning?
financial factors
PRACTICE BOOK» NOT FOR SALE
A. For undergoing an effective employee
A. working conditions development program
B. Disciplined manager B. To represent a base for recruitment
C. Friendly Coworkers
C. To represent a base for selection pol-
D. Strict policy icy
472. You are the project manager for the JHG D. All of the above
Project. This project requires coordination
with the directors of manufacturing, hu- 477. Which managers work directly with the
man resources, and the IT department, and employees who perform the day-to-day
the CIO. This is an example of what type tasks of a business?
of input to organizational planning? A. middle managers
A. Organizational interfaces
B. top management
B. Technical interfaces
C. supervisors
C. Interpersonal interfaces
D. all of the above
D. Human resource coordination
473. The final step in the HR planning process 478. “Human resource management” involves
is: the elements of
A. Analyzing A. planning, organizing, and controlling
B. Forecasting B. leading, directing and coordinating
C. Implementing C. procurement, development, integra-
D. Planning tion and maintenance
474. Which of the following is an example of D. All of the above
a benefit to job sharing?
479. To is to look for people to hire and
A. Absenteeism and tardiness is in- attract them to the business.
creased
A. turnover
B. Workers are less engaged and less
productive B. terminate
C. Provides employment opportunities C. spy
for many people who can’t work full time
D. recruit
D. none of above
480. . Which one is not the specific goal of
475. Tools a company uses to manage employ-
human resource management
ees are
A. Attracting applicants
A. HR tools
B. HR practices B. Separating employees
C. HR challenges C. Retaining employees
D. HR department D. Motivating Employees
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 678
481. involves using statistical techniques, 486. Multiple unions create
algorithms, and problem-solving to iden- A. Absence
tify relationships among data for the pur-
pose of solving particular problems. B. Interest
A. Data analytics C. Rivalry.
B. Social media D. labour leaders
C. Cloud computing 487. It is the process of evaluating the organi-
NARAYAN CHANGDER
zation, individual employees and employ-
D. Gaming
ees tasks to determine what kinds of train-
482. Which of the following benefits has not ing, if any are necessary
been provided under the Employee’s State A. Training
Insurance Act, of 1948? B. Training Needs Assessment
A. Sickness Benefit C. Work Environment
B. Unemployment Allowance D. Readiness for Training answer
C. Children’s Allowance
488. Which is NOT considered compensation?
D. Disablement Benefit
A. Salary
483. Managers subscribing to assumptions B. Company car
attempt to structure, control and closely C. Wage
supervise their employees.
D. Benefits
A. Theory ‘X’
B. Theory ‘Y’ 489. A drawing that shows the structure of
an organization, major job classifications,
C. Both Theory ‘X’ and Theory ‘Y’ and the reporting relationships among the
D. Neither Theory ‘X’ nor Theory ‘Y organization’s personnel.
A. Unity of Command
484. Human resource management started its
origin in the century B. Organization Chart
C. Employee Empowerment
A. 18th century
D. Accountability
B. 19th century
C. 20th century 490. When HR management executives partic-
ipate in a company’s long-range planning
D. recent origin efforts, they are taking part in
485. Employers are required to provide full- A. strategic management.
time employees with B. marketing.
A. pensions C. budgeting
B. holiday leave D. financial analysis.
C. sick leave
491. What are the steps in Human Resource
D. health insurance Planing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 679
A. Developing strategies for addressing 497. What does the acronym AMO stand for?
supply and demand Issues or (Bridging A. ability, mobility, operation
the gap)
PRACTICE BOOK» NOT FOR SALE
B. aptitude, mobility, operation
B. Job fairs and transfers
C. aptitude, motivation, opportunity
C. Gate hiring
D. ability, motivation, opportunity
D. Facilitating the a systematic forecast-
ing of HR requirements and capabilities 498. responsibility commensurates with
A. accountability
492. Which of the following describe the mood
of staff? B. supremacy
A. staff training C. command
B. staff motivation D. ascendancy
C. staff appraisal 499. Directing, being one of the preeminent
D. none of above functions of Human Resource Management
that falls under
493. The following function is not an aspect of
A. Operative functions
procurement as an HR function
B. Technical functions
A. Recruitment
C. Managerial functions
B. Compensation
D. Behavioral functions
C. placement
D. none of above 500. Techniques used by the human resource
planners are:
494. Function of Human resource management
A. Statistical method
is by nature
B. Judgmental method
A. helping
C. Both statistical and judgmental meth-
B. assisting ods
C. consulting D. None of the above.
D. advisory
501. an organization’s broadest plan, devel-
495. The obligation to accept responsibility for oped as a guide for major policy setting
the outcomes of assigned tasks. and decision making
A. Accountability A. strategy
B. Employee Empowerment B. competitive strategy
C. Unity of Command C. vision statement
D. Organization Chart D. strategic plan
496. How is a worker on commission paid? 502. What can affect staff motivation?
A. According to how much time is worked A. Work environment
B. According to the level of output B. Managers
C. According to how many items are sold C. Both managers and work environment
D. none of above D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 680
503. Job security is B. recruitment
A. employees feeling they will only have a C. human resource management
position for as long as management wants D. orientation.
them
B. the feeling that management are look- 508. What is the highest need in the theory of
ing to terminate employment human motivation?
A. Esteem
C. employees feeling they will continue
B. Physiologic
NARAYAN CHANGDER
to work somewhere until they decide it’s
time to move on C. Safety
D. an ongoing decrease in productivity D. Self Actualization
over time
509. The release of an employee from the com-
504. The development and implementation of pany due to inappropriate work behavior.
systems in an organization for attract-
A. Job Description
ing, developing and retaining a high-
performing workforce is the definition for B. Transfer
A. Culture Building C. Promotion
B. Human Resource Management D. Discharge
C. Human Resource Manager 510. Management has requested that you cre-
D. Recruitment Process ate a chart depicting all of the project re-
source needs and the associated activities.
505. The following concept is developed on Management is looking for which type of
unitarism, individualism, high commitment chart?
and strategic alignment. A. A roles chart
A. Personnel Management B. A roles matrix
B. Human Resource Management C. A roles and responsibilities matrix
C. Industrial Relations D. A Gantt chart
D. Personnel Administration
511. When a human resources department
506. A specific work activity an employee uses interactive computer simulations to
performs-such as answering the telephone help employees learn how to do their jobs,
or making photocopies of reports-is called it is using technology for purposes.
a A. training
A. job B. hiring
B. task C. compliance
C. human resource D. evaluation
D. function 512. Unit labor cost is computed by dividing:
507. Which of these the processes is used for A. the total cost of workers by their aver-
helping new employees adjust to a com- age levels of output.
pany? B. the total level of output by the total
A. training cost of workers.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 681
C. the average level of output by the av- 517. KSAT means knowledge, skills, aptitude
erage cost of workers. and
PRACTICE BOOK» NOT FOR SALE
D. the average cost of workers by their A. touch
average levels of output. B. talents
513. This is concerned with manpower plan- C. truimph
ning, recruitment, selection, placement, D. none of above
transfer, promotion, training and develop-
ment, layoffand retrenchment, remunera- 518. How many factors were identified by Pet-
tion, incentives, productivity, etc. tigrew & Whipp to manage the successful
change?
A. Personnel aspect
A. Four
B. Welfare aspect
B. Five
C. Industrial relations aspect
C. Three
D. none of above
D. Six
514. the assignment of additional tasks of a 519. Jaden is showing a group of new employ-
similar level of difficulty to employees ees how to perform work-related tasks.
A. job rotation What staffing activity is Jaden perform-
ing?
B. talent management
A. Recruiting
C. job enrichment
B. Interviewing
D. job enlargement
C. Appraising
515. Rahman has reviewed the applications of D. Training
five candidates for the chef position in his
company. What is Rahman’s next step in 520. According to a literature analysis by
the selection process? Schuler, the main reasons for engaging in
an IJV are:
A. Invite candidates for an interview
A. To gain knowledge and to transfer that
B. Request the candidates to take physi- knowledge
cal or medical exam
B. Host government insistence
C. Give the candidates selection tests C. Increased economies of scale
D. Check the candidates’ background and D. All 3 answer is correct?
references
521. Sohail works for “Energy Engineering
516. Sick-leave pay, vacation pay, pension Works.” Apart from the regular com-
plans and health plans are examples of: pensation, the company provides him
A. fringe benefits with things such as tuition reimbursement,
recreational opportunities etc. What is the
B. off-schedule salary name given to these things of value?
C. bonus sharing A. Incentives
D. non-monetary salaries B. Benefits
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 682
C. Rewards 527. Which term refers to the teaching of sev-
D. Compensation eral employees in a classroom setting?
A. on-the-job training
522. Minimum persons must be employed
in as the establishment for the applicabil- B. job rotation
ity of the PF act. C. group training
A. 15 D. orientation
B. 20
NARAYAN CHANGDER
528. Jobs are compensated on the basis of
C. 35
A. Job analysis
D. 50
B. Job worth
523. New approach to managing people in any C. Job specification
organization.
D. Job description
A. Human Resource
B. Human Resource Management 529. A key HR role in the firm will be multidis-
ciplinary consulting around
C. Human Resource Development
A. Individual
D. none of above
B. Team
524. What are the advantages for the busi-
C. Business unit
ness?
D. All of the above
A. Practicing Independence
B. Opening a Job 530. Performance appraisal means evaluating
an employees performance relative to
C. All Advantages Are Our Absolute
D. All answers are correct A. Establishing goods
B. Fellow employees
525. . Under the workmen’s compensation
act, 1923 employer shall not be liable to C. Job description requirements
pay compensation in respect of any injury D. Performance standards
which does not result in the total or partial
disablement of the workman for a period 531. HRD Does not include
exceeding days. A. Career Planning
A. 7 B. Succession Planning
B. 3 C. Managerial Planning
C. 5 D. MBO
D. 2
532. The following factor would be relatively
526. Appraising employee performances help low if supply of labour is higher than de-
you with deciding: mand.
A. Health plans A. production
B. Scheduling B. labour cost
C. Promotions C. wage
D. Team compensation D. all of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 683
533. Which of the following is not a step to 538. What kind of chart is being used to illus-
establish pay rates? trate scheduling?
PRACTICE BOOK» NOT FOR SALE
A. Conduct a job evaluation A. Gantt Chart
B. Compare pay grades to similar busi- B. Line Chart
nesses in different parts of the country
C. Doughnut Chart
C. research through market analysis
D. none of above
D. perform a job analysis and job evalua-
tion 539. You are the project manager in an organi-
zation with a weak matrix. Who will have
534. SHRM stands for
the authority on your project?
A. Soft Human Resource Management
A. The project manager
B. Sophisticate Human Resource Man-
B. Functional management
agement
C. Superior Human Resource Manage- C. The team leader
ment D. The customer
D. Strategic Human Resource Manage-
540. A human resource inventory is designed
ment
to revel whether:
535. The Human Resource Plan: A. the firm has enough land and capital
A. Should be created by the Human Re- B. worker morale is high or low
sources department
C. all workers are paid a fair wage
B. IS a part of the resource management
plan D. firms labor force is technically up-to-
date and well trained
C. Is a tool of Develop Project Team
D. Is an output of the Develop Human Re- 541. Which of the following is a reason that
source Plan Process the role of HR management is changing?
536. a statement of the organization’s A. Business costs are going down
purpose-what it wants to accomplish in B. The workforce is younger than ever.
the larger environment
C. Employees place a greater emphasis
A. HR scorecard on work over personal lives.
B. functional strategy D. There is greater diversity in the work-
C. mission statement force.
D. corporate strategy 542. The quality of Human resource manage-
537. Under point method, factor(s) generally ment is based on the of an organisa-
considered are tion
A. Skill, effort, Accountability A. performance
B. Skill, job enrichment, accountability B. productivity
C. Wage, job enrichment, accountability C. success
D. Wage effort, accountability D. teamwork
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 684
543. Selection into the Army as an officer re- 548. Which of the Options would best describe
quires various tests to ascertain each can- External Recruitment. 1.Placement Agen-
didate’s suitability to be an officer, which cies, 2. Employee Referrals, 3. Job Fairs.
selection test-best determines the talents, 4. Promotions.
personality and attributes of the candidate
A. 2 & 3
for the role of officer in the Army?
B. 1 & 3
A. Specific ability tests
B. Aptitude tests C. 1, 2 & 3
NARAYAN CHANGDER
C. Cognitive tests D. All of the Above
D. Psychological tests 549. A business’s human resources depart-
544. The advancement of an employee within ment is responsible for coordinating the
the small business to a position with more for employees.
authority and responsibility. A. purchase orders
A. Job Description B. information systems
B. Transfer C. sales promotions
C. Promotion D. performance evaluations
D. Discharge
550. A salary amount which enables the indi-
545. job analysis is also known as vidual to have food shelter, clothing etc.
A. job design fulfills which need:
B. job performance A. Self actualisation
C. work design B. Physiological
D. work analysis C. Social
546. Who are the individuals responsible for D. Safety
supervising and directing a group of em-
ployees to perform tasks (that are directly 551. Below is the non-equity modes of foreign
related to the creation and delivery of a operation EXCEPT:
company’s products or services) A. Joint Ventures
A. Boss
B. Subcontracting
B. Line Manager
C. Licensing
C. Assembly Line
D. Management contracts
D. HR Manager
552. . When was the government of India for-
547. Which measures are prescribed under
mulated an All India Scheme for Workers
labour laws?
education?
A. Voluntary
A. 1957
B. State Government
B. 1918
C. Statutory
C. 1931
D. Trade unions. Which measures are
prescribed under labour laws? D. 1975
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.9 Human Resource Management 685
553. This law was passed to promote the em- 558. Actively looking for qualified candidates
ployment of people over the age of 40 to fill a job is called
based on their ability rather than their
PRACTICE BOOK» NOT FOR SALE
A. development
age.
B. employment
A. Fair Labor Standards Act of 1938
B. Age Discrimination in Employment Act C. procurement
of 1967 D. recruitment
C. Americans with Disabilities Act of
1990 559. Evolution of HRMThe personal manage-
ment gained considerable importance after
D. Civil Rights Act of 1964
554. Which of the following is considered as A. The second world war
strategic activity?
B. invention of machines
A. Productivity
C. invention of trains
B. Recruitment
D. none of above
C. Planning
D. All of the above 560. Which means the same as human re-
sources
555. By definition off the job training takes
place A. Personnel
A. Online B. Knowledge
B. before work begins C. People
C. away from the place of work D. skills
D. before an employee is recruited
561. Compensation is basically an award in
556. Need-Hierarchy Theory was propounded the form of
by A. Job Promotion
A. Peter F. Drucker
B. Financial and Non-financial
B. Abraham Maslow
C. Financial
C. Mc-Fraland
D. Nonfinancial
D. Elton Mayo
562. Ensuring Employees have the necessary
557. is the process of acquiring, train-
knowledge, skills, abilities and other tal-
ing, appraising, and compensating employ-
ents to achieve work objectives falls under
ees, and attending to their labor relations,
which of the following categories?
health and safety, and fairness concerns.
A. Labor relations A. Work design and Workforce planning
B. Human resource management B. Managing Employee Competencies
C. Behavioral management C. Managing Employee Attitudes and Be-
haviors
D. Organizational health and safety man-
agement D. Compensation and incentives
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 686
563. A strategy that determines the means for 565. Which of the following is NOT a task of
utilizing resources in the various functional a Human Resource Manager:
areas to reach the organization’s goals
A. Health, safety and employee welfare
A. Corporate Strategy
B. Recruitment and selection
B. Mission Statement
C. Strategic Management C. Performance appraisal
D. Functional Strategy D. Budgeting and cash flow
NARAYAN CHANGDER
564. Joe worked the following hours this 566. In job-evaluation the Key Jobs are desig-
month:Week 1-25 hours; Week 2-40 nated as ones
hours; Week 3-15 hours; Week 4-10
hours. If Joe is paid $12.15 per hour, how A. Which are more in number in the or-
much did he earn this month? ganisation.
A. $972.00 B. Which are most important for the sur-
B. $1, 080.00 vival of the organisation
C. $1, 093.00 C. Which are most secure
D. $1, 093.50 D. All of the above
1.10 Banking and Financial Institutions
1. Moving money from one account to an- D. none of above
other is called a
4. The mechanism a nation uses to provide
A. Swap and manage money for itself is called a(n)
B. Transfer
C. Glide A. banking system
D. Movement B. monetary system
C. financial system
2. What is the biggest factor that affects
someone’s credit? D. inventory system
A. Number of accounts 5. A person who gets in legal trouble for us-
B. Amount of debt ing checks unlawfully is committing:
C. Payment history A. Robbery
D. Age of accounts B. Check Fraud
C. Loss of creditworthiness
3. What is an OVERDRAFT FEE?
D. Bank Fraud
A. A fee you pay to see Mr. French’s three
legged horse 6. A small plastic card issued by a bank, busi-
B. A charge when more money is spent ness, etc., allowing the holder to purchase
than what it is in the account. goods or services on credit.
C. moving a balance from one account to A. savings account
another B. credit card
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 687
C. credit union 12. How does the taxpexempt status of munic-
ipal bonds benefit consumers throughout
D. safe-deposit box
the US free enterprise system?
PRACTICE BOOK» NOT FOR SALE
7. A is a short-term credit investment cre- A. It make people more likely to buy cor-
ated by a non-financial firm and guaran- porate bonds
teed by a bank to make payment. B. It makes people more likely to buy mu-
A. certificate of deposit nicipal bonds
B. Commercial paper C. It increases the costs of projects like
roads and bridges
C. bankers’ acceptance
D. It raises the amount of taxes that the
D. none of above federal government collects
8. When you put money into your checking 13. From the following, what is the essen-
account, you will fill out a tial for any organisation to be called as a
Bank?
A. check stub
A. accepting for the purpose of lending or
B. check register investing of deposits
C. signature card B. accepting deposits, which are re-
payable on demand or otherwise
D. deposit slip
C. Permitted by RBI
9. What is a check that appears on your bank D. included in the Second Schedule of Re-
statement called? serve Bank of India Act, 1934
A. outstanding check 14. Why does the United States Government
B. cleared check issues savings bonds?
C. bounced check A. to improve its bond rating
B. to earn interest
D. good check
C. to pay for government projects
10. Income = + Savings D. to raise taxes
A. Needs 15. A bank statement shows
B. Wants A. all transactions from the statement pe-
C. Expenses riod
B. the transactions that have cleared in
D. Discretionary
the statement period
11. The movement of money electronically C. what your correct balance is
from one financial institution to another. D. all of the checks you have written for
A. fast cash the year
B. electronic financial transitioning 16. Which is the right of owner of hire pur-
chase? i. To forfeit the depositii. To re-
C. automated teller machine
possess the goodsiii. To claim damages for
D. electronic funds transfer any loss sufferediv. All of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 688
A. i A. bond
B. ii B. safe-deposit box
C. iii C. stock
D. iv D. savings account
17. Was established in 1913 and is the cen-
22. Are documents that function as cash but
tral bank of the United States. (multi-
can be replaced if lost or stolen
answers)
NARAYAN CHANGDER
A. Certified checks
A. The Federal Reserve Bank
B. The First Bank B. Cashier’s checks
C. The Feds C. Money orders
D. The USA Bank D. Traveler’s checks
18. Beyonce wanted to buy a hot tub and bor- 23. What is the prearranged agreement called
rows $7, 400 from a bank with an interest that an individual can have with a bank to-
rate of 10.5% SIMPLE interest. If she is transfer funds from your savings account
able to pay it back in 1/4 of a year how to your checking account if the checkingac-
much does she have to pay back total? count does not have enough funds to
pay an amount that is debited against
A. $7, 594.25
yourchecking account
B. $7710.80
A. balance draft
C. $194.25
B. bad check insurance
D. $26, 825.00
C. interest protection
19. Money you take out of your bank account
D. overdraft protection
A. withdrawal
B. deposit slip 24. Services offered by Retail Banking include
C. service charge
A. Savings & Transactional accounts
D. deposit
B. mortgages & personal loans
20. A point is a value equal to of a mort-
gage loan. C. Debit cards & Credit cards
A. 2 percent D. All of the above
B. 10 percent E. None of the above
C. 1 percent 25. Lowest amount of money you must keep
D. 5 percent in your account
21. A box-usually located inside a bank-which A. minimum balance
is used to store valuables, is rented from B. checking account
the institution and can be accessed with
C. interest
keys, pin numbers or some other security
pass. D. savings account
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 689
26. A machine that allows individuals to com- 31. A merchant bank can help an organization
plete certain transactions from machine specifically in promotion functions
without human assistance
PRACTICE BOOK» NOT FOR SALE
A. Sponsoring the issue
A. Savings tool B. Marketing
B. Automated teller machine C. All of the above
C. commercial bank D. none of above
D. online banking 32. What are the two types of accounts avail-
able at banks and credit unions?
27. If you make a mistake writing a check you
should A. Checking and Savings
A. write VOID across the check and B. Checking and Loans
record it in your transaction register C. Savings and Loans
B. throw the check away in the trash and D. Debit and Credit
write a new one
33. What is the total amount of money in a
C. call the bank and have them cancel the bank account at any given time?
check
A. FDIC
D. erase the errors and write it again
B. Overdraft Fee
28. is not the duty of an auditor of a bank C. Account Number
auditor D. Balance
A. To certify Statutory reports
34. Banks move money between
B. To maintain books of accounts of
A. other banks
banks
B. banks and individual customers
C. To help the investigator
C. governments
D. To maintain confidentiality
D. all of the answers
29. markets transfer funds from people
35. Which of the following largely eliminated
who have an excess of available funds to
the wide variation of legal regulation from
people who have a shortage.
the country’s payments system?
A. Commodity
A. Federal Reserve Act of 1913
B. Fund-available B. Uniform Commercial Code of 1958
C. Financial C. National Banking Act of 1864
D. Derivative exchange D. Expedited Funds Availability Act of
1987
30. When do you have to sign a deposit slip?
36. Depository institutions that offer many
A. When you receive cash back
banking services and are owned by their
B. When you deposit any amount of cash customers
C. When you deposit more than $100 A. commercial bank
D. When you deposit more than $10, 000 B. credit union
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 690
C. mobile banking 42. Which of the following statements about
D. online banking check cashing companies is TRUE?
37. Which one of the below is not a service A. They have limited operating hours dur-
provided by postal Bank of India ing the day.
A. Kisan vikas Patra B. They sometimes offer free services.
B. Issue of national saving certificate C. They charge high fees.
C. Money transfer
NARAYAN CHANGDER
D. They delay when you can access your
D. mutual Funds cash.
38. The Bank Secrecy Act of 1970 re-
quires U.S. financial institutions to assist 43. Checking account, debit cards, automatic
U.S.government agencies to: withdrawal, and online payments are ex-
A. set interest rates amples of
B. detect and prevent money laundering A. Savings Services
C. audit customer accounts B. Payment Services
D. audit financial institutions
C. Loan Options
39. What is a check that does not appear on
the bank statement called? D. Investment Advice
A. good check
44. What is a CREDIT UNION?
B. outstanding check
C. cleared check A. A nonprofit financial institution that is
owned by its members and organized for
D. bad check their benefit.
40. Small Savings Scheme like national sav- B. a type of short-term borrowing where
ings certificates, Public Provident Fund, a lender will extend high-interest credit
Monthly Income Schemes are popular based on a borrower’s income and credit
among the salaried people. Which finan- profile
cial institutions manage these schemes?
A. Public sector banks C. moving a balance from one credit card
account to another
B. Commercial banks
C. Post offices D. none of above
D. Co-operative banks
45. All of these are required to open a bank
E. None of these account except
41. is the process of paying checks and A. Valid Photo ID for proof of age / iden-
other payments among different banks. tity
A. Investing
B. Social Security Card
B. Clearing
C. Depositing C. Money to open the account
D. Loaning D. A job
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 691
46. Which non-deposit institution makes loans 51. Which two government agencies insure
based on the value of some tangible object, money in accounts at banks and credit
such as jewelry or electronics? unions? Select both agencies.
PRACTICE BOOK» NOT FOR SALE
A. Mortgage Companies A. WPA
B. Check Cashing Outlets B. FDIC
C. Pawnshops C. NCAAP
D. Investment Companies D. NCUA
47. is a type of savings account that can offer
52. A Bank Statement contains the following:
a higher interest rate compared to tradi-
tional savings but lower rate than a CD. A. How many loans a bank has given in a
However, these accounts often require a year
higher minimum balance to be maintained. B. How many days a year the bank is open
A. Money Market Account C. When the bank transferred money
B. Mutual Fund D. A list of transactions of someone’s
C. Certificate of Deposit bank account
D. Traditional Savings Account
53. The 9-digit number printed on a check that
48. Commercial Banks identifies the bank that holds the checking
account and is responsible for payment is
A. These banks also offer credit services,
called the
cash management and trade finance.
A. transit number
B. Their clients include large corpora-
tions, other financial institutions. B. account number
C. These manage the banking and finan- C. check number
cial needs of high net worth individuals.
D. NSF number
D. none of above
54. People who puts money in the banks
49. Which of the following are meant to store
money which is NOT intended for daily ex- A. depositors
penses? B. withdrawers
A. Loan accounts C. customers
B. Checking accounts D. tellers
C. Savings accounts
55. Which non-deposit institution chooses
D. Credit accounts investment opportunities for long-term
50. How much money are you supposed to growth of their money and make mutual
keep in your emergency funds? funds available.
A. 4-6 months living expenses A. Life Insurance Companies
B. 6-8 months living expenses B. Pawn Shops
C. 1 year living expenses C. Consumer Finance Companies
D. none of above D. Investment Companies
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 692
56. Account that lets you save money 61. Examples of these types of banks are
Wells Fargo, Chase, and Regions
A. minimum balance
A. commercial banks
B. checking account
B. credit unions
C. interest
C. charters
D. savings account
D. none of above
57. Last year, First National Bank of Spring- 62. A blank endorsement on a check:
NARAYAN CHANGDER
field paid $5.1 million in interest to depos-
A. Has no effect on the check
itors; it collected $7.8 million in interest
from loans. Calculate the spread. B. Cancels the check
A. $12.9 million C. Creates a check that can be cashed by
anyone
B. $2.7 million
D. Restricts the use of the check
C. $5.1 million
63. In which of the following case bank auditor
D. $3.8 million is considered as disqualified?
58. Which savings account will earn you the A. A body corporate other than LLP
least money? B. Limited Liability Partnership
A. One that compounds interest daily. C. An individual who is a qualified CA
B. One that earns simple interest D. Partnership Firm
monthly. 64. Allows customers to pay for purchases di-
C. One that earns simple interest daily. rectly from their checking account.
D. One that compounds interest monthly. A. Credit card
B. Debit card
59. The deposits for a fixed term can be de-
C. Savings account
posited in account
D. Deposit
A. Saving account
65. Direct deposit typically refers to your
B. Current account
sending your electronically to your
C. Recurring deposit account bank account.
D. Term or fixed deposit account A. employer, bills
B. parents, allowance
60. Writing a check is more secure than cash
in all the circumstances EXCEPT C. employer, paycheck
D. state government, taxes
A. it is safer to mail cash for a bill since
someone could steal the check and cash it 66. Where do Banks get the money they use
B. some bills cannot be paid with cash to loan out to others?
A. The Government
C. someone can steal your cash and you
would be out that amount B. The Federal Reserve
D. you have proof of payment with a C. Other Banks
check D. The Savings of Depositers
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 693
67. a request made to a financial institution to 71. Which of the following concept is used for
cancel a check or payment that has not yet islamic banking?
been processed
PRACTICE BOOK» NOT FOR SALE
A. Al Mudharabah (profit-sharing)
A. Stop Payment
B. Al Murabahah (cost plus)
B. Start Payment
C. Al Hiwalah (remittance)
C. Stop Processing
D. All of above
D. Standby Payment
72. Banks have customers sign a signature
68. A mutual fund
card when opening a checking account to-
A. pools the savings of many individuals help protect against:
and invests it in a variety of financial as-
A. counterfeiting
sets
B. collects premiums from the people B. phishing
who buy insurance and lends out a portion C. forgery
to investors D. overdraft
C. uses risky strategies that often makes
huge profits for wealthy investors 73. Liam wants cash from his bank, but it is
closed, He will use the ATM.
D. invests employee retirement money in
stocks, bonds and other financial assets A. credit card
69. stages of a loan cycle.i. credit analysis- B. debit card
loan administration-marketing-loan re- C. savings account
coveryii. marketing-credit analysis-loan
D. none of above
administration-loan recoveryiii. credit
analysis-marketing-loan administration- 74. Which non-deposit institution is used by
loan recoveryiv. credit analysis-loan people who do not have bank accounts to
administration-loan recovery-marketing cash paycheck? They also do electronic tax
A. i filing, money orders, utility bill payments.
B. ii A. Mortgage Companies
C. iii B. Check Cashing Outlets
D. iv C. Pawnshops
70. Which of the following transactions may D. Investment Companies
be missing when you go online to review
your checking account balance? 75. A For Profit Depository Institution. May
be privately owned or publicly traded.
A. ATM cash withdrawal from yesterday Anyone can open account, no membership
B. Automatic payment for your car loan required. Generally lower savings rates
paid two days ago and higher fees
C. Debit card transaction from purchas- A. Bank
ing snacks at a local convenience store to-
B. Credit Union
day
D. Check that you mailed to your cousin C. Payday Lender
for his birthday today D. Check Cashing Company
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 694
76. The tools and strategies the Federal Re- 81. Stock prices are
serve uses to stabilize the economy is A. relatively stable trending upward at a
called? steady pace.
A. Fiscal Policy B. relatively stable trending downward at
B. Monetary Policy a moderate rate.
C. Tight Money C. extremely volatile (suddenly changed
in a short period of time)
D. Easy Money
NARAYAN CHANGDER
D. unstable trending downward at a mod-
77. Individuals who you financially support in erate rate.
your household are:
82. What is a disadvantage of using a debit
A. dependents card?
B. heirs A. you could forget to put the transaction
C. tax shelters in your register and have an inaccurate
balance
D. exemptions
B. if someone steals your card they could
78. What is the number of electoral votes for steal all of your money
each state based on?
C. you could go into debt by purchasing
A. Population more than you can afford
B. Congressional Representation D. there are no disadvantages
C. Number of registered voters in the 83. A prospectus tells you
state
A. if you have a liquid investment
D. How long that state has been part of
B. how well your investment is perform-
the United States.
ing
79. If a company is already in liquidity crunch C. whether or not you need a financial in-
and flotation costs of the issue would be termediary
high. What kind of instrument will be ap-
D. if you need a hedge fund
points for the money market.
A. Treasury Bill 84. As a property of money, means that
money must maintain its value over time
B. Commercial Paper in order to be widely accepted.
C. COD A. stable
D. Commercial Bills B. portable
80. What does a Checking Account Number C. durable
identify? D. recognized
A. A particular check
85. Financial markets promote greater eco-
B. The primary identifier for ownership of nomic efficiency by channeling funds from
an account to
C. What bank the account is with A. investors; savers
D. What date the check was written B. borrowers; savers
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 695
C. savers; borrowers 91. Business that keeps your money safe until
D. savers; lenders you need it.
PRACTICE BOOK» NOT FOR SALE
A. bank
86. Goldman Sachs is which type of financial
institution? B. bank account
A. Commercial bank C. balance
B. Investment bank D. application
C. Brokerage firm
92. Reggie decides to set up an Automatic Bill
D. Insurance company Pay Service in order to:
87. Banks provide which of the following A. To be able to use an ATM
A. debit cards B. To have his money transferred at a pre-
B. loans determined date to pay a recurring bill
C. check writing services C. To automatically pay the bank for loans
D. all of the above D. To have the bank take money from his
paycheck and put it directly into a savings
88. Tyler needs a place for his paycheck to be account
direct deposited, he knows he will not earn
much interest and does not really like be- 93. type of account is opened by business
ing a member of anything. What would be man
Tyler’s best choice?
A. Current account
A. Credit Union
B. Savings Bank account
B. Bank
C. Title Pawn C. Recurring deposit account
D. Payday Loan D. Term or fixed deposit account
89. The type of account where any number 94. If there is an issue with your bank state-
of transactions can be made inappropriate ment or account balance, who should you
day with bank is contact to resolve the issue?
A. Savings Bank account A. The local police station
B. Recurring deposit account B. Your bank
C. Current account C. The CFPB
D. Fixed deposit account D. All of the above
90. Used to withdraw money from an ATM.
95. Which of the following services would
Does not have all the functions of a debit
LEAST likely be offered online by a bank?
card.
A. Debit Card A. Safety deposit boxes
B. Credit Card B. Funds transfers between accounts
C. ATM Card C. Bill payment services
D. Prepaid card D. Loan applications
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 696
96. a request for a financial institution to A. The temporary giving of money or prop-
refuse to honor a check you wrote or a erty to another person
check that has been lost or stolen, as long
B. To assist small and medium sized en-
as the check has not cleared your account
terprises (SMEs) which have viable busi-
and already been paid
nesses
A. stop-payment order
C. The legal status of a borrower
B. cashier check
D. Non-cancellable contractual agree-
NARAYAN CHANGDER
C. certified check ment made between a lessor and a lessee
D. none of above
101. Which type of loans have less prone to
97. is a product offered by banks and credit the risk of becoming NPA
unions that offers an interest rate pre- A. Retail loans
mium in exchange for the customer agree-
ing to leave a lump-sum deposit untouched B. Whole sale loans
for a predetermined period of time. C. Gold loans
A. Checking Account D. Mortage loans
B. Savings Account
102. Suppose you own 100 shares of stock in
C. Mutual Funds
a company, and each share is worth $120.
D. Certificate of Deposit A 2-for-1 split would leave you with
98. You bought a stock on January 1. At the A. 100 shares worth $120 each
end of the year, why might you analyze B. 100 shares worth $240 each
published data from the S & P 500?
C. 200 shares worth $60 each
A. To see whether the stock has just split.
D. 50 shares worth $240 each
B. To find out how the stock performed
that year 103. Which bank is called as “ Mother bank of
C. To decide whether to switch to the India “
Dow next year. A. Canada bank
D. To determine whether bonds are earn-
B. Corporation bank
ing more than stocks.
C. State bank of India
99. High interest rates might purchasing
a house or car but at the same time high D. Reserve Bank of India
interest rates might saving.
104. accepts deposits from people and
A. discourage; encourage businesses and uses them to finance their
B. discourage; discourage business.
C. encourage; encourage A. Members
D. encourage; discourage B. Non-Deposit Institutions
C. Pawn Shops
100. What is New Principal Guarantee Scheme
(NPGS)? D. Deposit Institutions
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 697
105. You can use your ATM card with no fees 110. are interactive bank kiosks that pro-
at any teller machine displaying the same vide customers all services except cash-
logo transactions without actual bank tellers.
PRACTICE BOOK» NOT FOR SALE
A. network A. Virtual tellers
B. bank
B. Electronic tellers
C. free
C. ATMs
D. ATM
D. Virtual agents
106. Which of the following is the WISEST
strategy for a new investor in the stock 111. Issue management is an important func-
market? tion of and
A. Buy growth stocks recommended by a
A. Public manager and merchant banker
relative.
B. Buy preferred stocks with a three- B. Bank manager and lead manager
month call option. C. Merchant banker and lead manager
C. Buy blue chip income stocks through a
D. none of the above
brokerage firm.
D. Buy the hottest common stocks and 112. Banks provide all of the following EX-
sell them as soon as the price rises. CEPT
107. What is a CHECKING ACCOUNT? A. debit cards
A. A type of bank account that allows B. loans
check writing, withdrawals and deposits
of your money. C. check writing services
B. a bank account that earns interest D. government subsidies
C. a bank account where you invest your
money for long term growth 113. The Network of banks consists of over
bank branches
D. none of above
A. 860
108. How often do you receive a bank state-
ment about your accounts? B. 8600
A. once a year C. 86000
B. once a month, it might be electronic D. 86
C. never, use your internet bank
D. once in every 6 months 114. Fill in the blank:The Federal Reserve reg-
ulates banks to ensure the soundness of
109. In the given below options which bank is the banking system and safety of
private bank?
A. Loans
A. SBI
B. Stocks
B. Canara Bank
C. Punjab national Bank C. Deposits
D. Union Bank D. Interest
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 698
115. Bank account used by depositors to accu- 121. Put money in.
mulate money for future use.
A. withdraw
A. Savings account
B. cheque
B. Checking account
C. Mutual funds account C. deposit
D. Certificate of Deposit D. bank account
116. Which financial institution protects indi-
NARAYAN CHANGDER
122. A/an account is meant for transac-
viduals by insuring bank deposits? tions. You use it for paying bills and day
A. FDIC to day expenses
B. FSA A. Checking Account
C. FIS B. Savings Account
D. LPM
C. Money Market Account
117. Which type of bank account is best for
D. Certificate of Deposit
everyday transactions?
A. Certificate of Deposit 123. Money or other property that is turned
B. Money Market Account over to a bank to manage for a customer
is said to be held in
C. Savings Account
D. Checking Account A. reserve
118. Money you put into your bank account. B. escrow
A. withdrawal C. mortgage
B. deposit slip D. trust
C. service charge
124. Type of savings plan that requires a high
D. deposit
minimum balance and pays variable inter-
119. An asset is declared as doubtful asset if it est rate.
remains in sub-standard category for more
A. Regular Savings Account
than months
A. 10 B. Checking Account
B. 15 C. Money Market
C. 12 D. Debit Card
D. 6
125. a sum paid or charged for the use of
120. A check written by the bank on its own money or for borrowing money
funds. SECURE!
A. Interest
A. Cashiers Check
B. Credit cards
B. Promissory Note
C. Canceled Check C. Funds
D. None of the above D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 699
126. A merchant accepts debit cards to pay for C. providing public goods
purchases with D. selling resources
PRACTICE BOOK» NOT FOR SALE
A. point-of-sale transactions
132. The Federal Reserve Bank is managed by
B. direct deposits a
C. automatic bill payment A. Board of Bankers
D. ATM transactions B. Board of Managers
127. Which type of check endorsement be- C. Board of Governors
gins with “For deposit only to account No. D. Board with a chairman
123456 “?
133. An example for nationalized bank is
A. blank
A. State bank of India
B. special/full B. Rural bank
C. transfer C. Option A and B
D. restrictive D. None of the above
128. When did RBI nationalise? 134. Direct deposit, automated transfer, auto-
A. 1949 mated loan payments, and automated bill
pay are all examples of
B. 1947
A. Automated services you can request
C. 1948
from your financial institution
D. 1952
B. bad financial practices as you could be-
129. “Form A” of Third Schedule of Banking come a victim of fraud
Regulation Act, 1949 deals with prepa- C. something that may become available
ration of of financial statements of in the future
Banks. D. services that you can be charged for at
A. Balance Sheet your financial institution
B. Profit & Loss Account 135. The financial intermediaries that the aver-
C. Revenue Account age person interacts with most frequently
are
D. Appointment of auditor
A. exchanges.
130. Savings accounts typically offer more in-
B. over-the-counter markets.
terest than what type of account?
C. finance companies.
A. Retirement account
D. banks.
B. Money market account
136. If there is a mistake with one of your
C. Checking account
bank accounts, who should you contact to
D. Certificate of deposit resolve the issue?
131. How do banks make money? A. The CFPB
A. loaning out money and charging inter- B. No one, you can’t resolve the issue
est C. The local police station
B. paying interest to depositors D. Your financial institution
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 700
137. Which one of the following is a title typ- 142. A check that is issued and guaranteed by
ically held by a bank officer? a bank
A. bookkeeper A. Certified checks
B. controller B. Cashier’s checks
C. marketing coordinator
C. Money orders
D. job analyst
D. Traveler’s checks
NARAYAN CHANGDER
138. Payment made for the use of borrowed
money is called 143. Typical e-banking services allow cus-
tomers to do all of the following EXCPET
A. Financial Institution
B. Creditors A. obtain cash
C. Interest B. transfer funds from savings to check-
ing
D. Secured
C. print new checks
139. What agency regulates banks and finan-
cial institutions and insures each deposi- D. pay bills online
tor’s accounts up to $250, 000?
144. A check that is drawn by a bank on its
A. State Farm own funds and signed by an authorized of-
B. Internal Revenue Service ficer of the bank is a:
C. Individual Banks A. Cashiers Check
D. Federal Deposit Insurance Corpora- B. Collateralized Check
tion
C. Certified Check
140. Emilio borrows $1200 from a bank with
8% simple interest per year. How much D. Certificate of Deposit
will he have to pay back total in 2 years?
145. What is one advantage of a money mar-
A. $150 ket mutual fund as compared with a sav-
B. $192 ings account?
C. $1350 A. it has more risk
D. $1392 B. it has lower interest
141. In a trust account, the is the per- C. it has higher interest
son who establishes the account and
D. it is insured by the FDIC
paysfunds into the account and the is
the person who receives the funds uponthe
146. What service is available through home
passing of the person or when they have
banking on the internet?
met the required age.
A. checking account balances
A. benefactor; trustee
B. trustee; beneficiary B. withdrawing cash
C. beneficiary; trustee C. lending money to a friend
D. trustee; benefactor D. selling gold
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 701
147. a service provided by a bank that pro- B. debit card
tects against non-sufficient funds. If you C. interest card
spend more than what is in your checking
PRACTICE BOOK» NOT FOR SALE
account, this covers the purchase. Beware, D. savings card
though, banks can charge steep fees for
152. When I purchase a corporate , I am
this service!
lending the corporation funds for a specific
A. Over the top protection time. When I purchase a corporation’s ,
B. Overdraft Protection I become an owner in the corporation.
C. Overage Charges A. bond; stock
D. Payday Loan B. stock; bond
C. stock; debt security
148. A prepaid card for phone service and
other similar transactions. D. bond; debt security
A. stored-value card 153. What agency performs central banking
B. credit card functions in the United States?
C. debit card A. Federal Reserve
D. none of above B. Securities and Exchange Commission
C. US Treasury Department
149. is a company engaged in the business
of dealing with monetary (money) trans- D. First National Bank
actions; such as, loans, investments, and
currency exchange. 154. What happens to the costumer’s money
if the bank goes bankrupt?
A. Financial Institution
A. He loses it all
B. Commercial Bank
B. It is insured by law so he gets back the
C. Financial Banks whole amount
D. Commercial Institution C. It is insured by law up to 100 000 HUF
150. One benefit of our free enterprise syst- / costumer / bank
tem is that it D. none of above
A. allows the government to decide what
155. Which is the following is commercial Bank
goods and services will be produced
A. Affin Bank
B. provides people with opportunities to
invest their savings for their most produc- B. Bank Rakyat
tive use C. HSBC bank Malaysia Berhad
C. restricts individual wealth D. Muamalat Bank
D. benefits businesses and not individu-
156. A check register is a tool for
als
A. earning interest on your balance
151. A plastic card that is electronically con-
nected to the cardholder’s depository insti- B. paying regular bills
tution account C. keeping track of your account balance
A. credit card D. accessing your account
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 702
157. Fill in the blanks. Many banks do not B. 10
charge fees for transactions if you keep a
C. 12
minimum balance. They offer a
D. 21
A. unlimited transactions
B. transaction limit 163. When have banks existed since?
C. fee waiver A. 14th century
D. NSF charge B. 12th century
NARAYAN CHANGDER
158. The banks which perform function of ac- C. 16th century
cepting and lending loans are known as
D. 10th century
banks
A. Commercial Banks 164. A stock is
B. Development Banks A. A type of debt investment that acts like
C. Regional Rural Banks a loan.
D. Cooperative Banks B. A type of investment that invests in a
mix of different types of investments.
159. Financial institution that does not accept
deposits. C. A share of ownership in a company.
A. Nondepository institution D. A type of savings account that pays in-
terest based on current interest rates in
B. Depository institution
the money market.
C. Finance company
D. Securities firm 165. Which of the following statement is
false?
160. is a type of software to prepare in-
A. LFAR generally prepared in question-
come tax forms.
naire form
A. Quicken
B. LFAR is a substitute for statutory audit
B. Excel report
C. Turbo tax C. LFAR stands for Long Form Audit Re-
D. Database port
161. What are two services available on most D. Statutory auditor should carefully read
online and mobile banking platforms? Se- the LFAR
lect both services.
166. What fees do you have to consider when
A. Stock trading you open a bank account?
B. Direct deposit A. interest, commission, maintenance
C. Online bill pay fee
D. Financial advising B. opening fee, monthly fee, fee for with-
drawing money
162. How many federal reserve districts are
there? C. opening fee, monthly fee, dividend
A. 5 D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 703
167. It is safer to keep your money here than B. credit union
at home under your mattress.
C. insurance agency
PRACTICE BOOK» NOT FOR SALE
A. Balance
D. bank
B. Want
C. Inflation 173. Which is a difference between Banks and
Credit Unions?
D. Bank
A. Banks have Checking accounts and
168. Mary has endorsed a check by writing Credit Unions have Savings Accounts
“For deposit only” above his signature.
B. Banks are for profit. Credit Unions are
This is a
Non-profit.
A. restrictive endorsement
C. Banks can give loans and Credit
B. blank endorsement Unions cannot
C. full endorsement D. Credit Unions allow everyone to join
D. special endorsement and Banks are selective
169. The acts as the federal government’s 174. When must you sign a deposit slip?
bank
A. when you receive cash back
A. Federal Reserve Bank
B. when you deposit any amount of cash
B. Bank of America
C. when you deposit more than $100
C. First Bank of the United States
D. when you deposit more than $10, 000
D. National Bank of the United States
170. Form you fill out with personal and em- 175. Click on two characteristics of money.
ployment information. A. limited supply
A. bank B. store of value
B. bank account C. portability
C. balance D. universal
D. application
176. Unchanging rate of interest
171. Signing the back of a check, along with
A. Variable Interest Rate
the words “For Deposit Only” is which
type of endorsement? B. Savings
A. Blank C. Fixed interest rate
B. Restrictive D. Interest
C. Special
177. One job of the Federal Reserve is
D. Good
A. withholding social security.
172. A nonprofit financial institution that is
B. holding of reserves.
privately owned and provides banking ser-
vices for its members is called a C. loaning individuals money.
A. trust department D. collecting outstanding loans.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 704
178. An individual who hold legal control of as- 183. Consumers can borrow money from
sets in a trust account is known as which banks to
of the following?
A. get a credit card
A. Controller
B. raise capital
B. Dependent
C. purchase a home or pay for college
C. Claimer
D. save money
D. Beneficiary
NARAYAN CHANGDER
184. Why do banks charge you fees?
179. normally has a maturity between 6
months to 3 years and more.i. term loanii. A. For different services
personal loaniii. housing loan B. They want money
A. i C. Because they are mean
B. ii D. So I can leave their bank
C. iii
185. Financial institutions are monitored
D. none of above
through which of the following?
180. For-profit depository businesses that of- A. Federal Reserve System
fer financial services to both consumers
and other businesses B. National Banking Union Administration
A. checking account C. Federal Deposit Insurance Corpora-
tion
B. debit card
D. National Financial Institution Agency
C. commercial bank
D. mobile banking 186. In the United States, the money supply
(M1) is comprised of:
181. is the minimum dollar amount that a cus-
tomer must have in an account to receive A. coins, paper currency, and checkable
some service benefits, such as keeping the deposits
account open or receiving interest OR to B. . currency, checkable deposits, and Se-
avoid paying account maintenance fees ries E bonds
A. Maximum Balance C. coins, paper currency, checkable de-
B. Minimum Liquid Assets posits, and credit balances with brokers
C. Minimum Balance D. paper currency, coins, gold certifi-
cates, and time deposits
D. None of the above
182. Money that has no intrinsic value and 187. What is the additional insurance that
does not represent another valuable com- many finance companies require owners to
modity in a vault somewhere. payfor when they finance an auto loan?
A. representative money A. gap
B. commodity money B. home
C. monopoly money C. life
D. fiat money D. payment
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 705
188. Financial institutions that get funds from C. All of above
the public and use them to finance their D. none of above
business
PRACTICE BOOK» NOT FOR SALE
A. depositor 193. How would you reconcile your bank ac-
count to avoid spending more than you
B. depository intermediary have?
C. wholesale bank A. Contact your financial institution to
D. nondepository intermediary read your transactions for the past month.
B. Compare your own records of your
189. The correct order in the principles
spending with your financial institution’s
of good lendingi. Purpose-Amount-
records.
Duration-Repayments-Securityii. Amount-
Purpose-Repayments-Duration-Securityiii. C. Review your bank statement once at
Duration-Amount-Purpose-Repayments- the end of the month.
Securityiv. Security-Purpose-Duration- D. None of the above.
Amount-Repayments
194. Two types includes mutual savings and
A. i
loan associations and stock savings and
B. ii loans association.
C. iii A. credit unions
D. iv B. savings and loans associations
190. When the bank pays a transaction for you C. commercial banks
because you don’t have enough money in D. insurance companies
your account it’s called an
195. Poorly performing financial markets can
A. withdrawal be the cause of
B. overdraft A. wealth.
C. bank B. poverty.
D. income C. financial stability.
191. Financial institutions that obtain funds D. financial expansion.
from the public and use them to finance
196. What type of investment offers the most
the loans and investments that provide the
liquidity?
majority of their income.
A. stocks
A. Loan companies
B. mutual funds
B. depository institutions
C. CD’s
C. non depository institutions
D. checking account
D. brokerage houses
197. A profit is
192. A merchant banking is a financial institu-
tions conducting money market activities A. money earned
and a lending B. money spent
A. underwriting and financial advice C. money borrowed
B. Investment service D. money lent
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 706
198. Online bank accounts are available 203. Financial institutions that do not take or
A. During office hours hold deposits
B. Until midnight A. depositor
C. Monday to Friday B. depository intermediary
D. 24 hours a day C. wholesale bank
199. Type of savings plan where money is left D. nondepository intermediary
NARAYAN CHANGDER
on deposit for a stated period of time.
204. Which of the following pays the highest
A. Certificate of Deposit (CD)
interest rate?
B. Money Market
A. CD
C. Savings Account
B. savings account
D. Checking Account
C. checking account
200. In Murabahah financing, when an orderer
is asked to pay a certain amount of money D. money market account
in advanced to the seller in order to show
seriousness towards the transaction that 205. PIN stands for
can later be refunded upon certain condi- A. payment information number
tions, the contract used is called:
B. personal information number
A. Arboun
C. personal identification number
B. Hamish Jiddiyyah
C. Down payment D. payment identification number
D. All options are correct 206. Also called a check card, allows you
to make purchases by swiping your card
201. Which type of bank account typically of-
through a point of sale (POS) terminal that
fers the least (if any) interest?
is usually located at the merchant’s check-
A. Savings account out counter.
B. Checking account A. debit card
C. Money market account
B. credit card
D. Certificate of deposit
C. social security card
202. How do banks make profits? D. ATM card
A. By charging people interest to borrow
money. 207. Checking accounts and debit cards are ex-
B. By charging people interest to keep amples of a financial institution’s
their money there. A. lending services
C. By charging a fee every time a cus- B. saving services
tomer writes a check or uses a debit card.
C. payment services
D. None of the above-banks are nonprofit
institutions D. investment services
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 707
208. Protects you from overdrawing your ac- 213. Which of the following is NOT a function
count. Money is automatically taken from of a bank?
your savings account if you write a check
PRACTICE BOOK» NOT FOR SALE
A. manufacture
or make an ATM withdrawal for too much
money. B. exchanging
A. Withdraw Protection C. lending
B. Overdraft Protection D. safeguarding
C. Blanket protection 214. The cashier of a bank should not have ac-
D. Maximum Protection cess to of a bank
209. is the act of opening accounts at two A. Currency counting machine
or more institutions and using the “float- B. Cash Vault
time” of available funds to crate fraudu- C. Ledger Accounts
lent balances.
D. Attendance register
A. Counterfeiting
B. Reconciliation 215. Financial institutions that provide tradi-
tional checking and savings accounts for in-
C. Check kiting
dividuals and business. They also provide
D. Forgery loans. Both Banks & Credit Unions are ex-
amples.
210. The U.S. corporation insuring deposits in
the U.S. against bank failure. A. Depository Institution
A. Federal Deposit Insurance Corpora- B. The Stock Market
tion C. Payday Lenders
B. National Credit Union Association D. Check Cashing Company
C. Savings and loan associations
216. What is paying for something with
D. none of above money that you borrow and must pay
211. Which bank is called lender of last re- back, usually with interest?
sort? A. Income
A. Commercial bank B. Credit
B. Agricultural bank C. Interest
C. Central bank D. Lend
D. none of above
217. Payment transactions that can be com-
212. Which non-deposit institution provide pleted with no physical connection be-
loans for buying a home or other real es- tween the payment device and the phys-
tate? ical point of sale terminal or store clerk
A. Mortgage Companies A. contactless payment
B. Check Cashing Outlets B. credit union
C. Pawnshops C. debit card
D. Investment Companies D. depository institutions
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 708
218. You have a tax-deferred retirement ac- B. Keep all my confidential information to
count. At what age can you start with- myself
drawing money? C. Install anti-virus software from my
A. 59 1/2 computer
B. 65 D. Write down my confidential informa-
tion on my twitter bio
C. 62
D. At any age 224. This is money that has value because the
NARAYAN CHANGDER
substance it is made of has value like gold
219. A loan where an asset stands good for and silver.
the loan and is not based off of the bor-
A. characteristics of money
rower’s creditworthiness is a:
B. fiat money
A. Car Loan
C. representative money
B. Collateralized Loan
D. commodity money
C. Cash Loan
D. Mortgage Loan 225. Writing only your name on the back of
a check is called which type of endorse-
220. A summary of all deposits, charges, and ment?
withdrawals sent to you monthly. A. Blank Endorsement
A. endorse B. Special Endorsement
B. overdrawn C. Restrictive Endorsement
C. debit card D. Plain Endorsement
D. statement
226. The word ‘Bank’ is derived from
221. What is function banker to the bank? A. Banque
A. Management of banking system B. Banco
B. Lender of last resort C. Both 1 and 2
C. Financial institution D. Only 1
D. Management of government accounts 227. Investing is best for
222. Bank that receives its charter from the A. short-term financial goals, like build-
star in which it operates ing an emergency fund.
A. Account B. earning a little interest while keeping
your money safe.
B. State-chartered bank
C. long-term financial goals, like paying
C. Service
for retirement.
D. none of above
D. guaranteed fast growth on your
223. How can I protect myself from identity money.
theft? 228. Daycare can be very expensive! My
A. Give my confidential info to my friends friend pays $972 every month for her 3
and family year old daughter. This is considered a
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 709
A. Fixed Expense 233. Lead of merchant banker should advice
the issuer to enter into intermediary
B. Variable Expense
for the purpose of issue management.
PRACTICE BOOK» NOT FOR SALE
C. Discretionary Expense
A. Agreement
D. Income
B. Arrangement
229. Which of the following statements about C. Memorandam of association
investing is TRUE? D. none of above
A. On average, putting money in a sav-
ings account earns a higher return than 234. Your PIN should be
investing money in the stockmarket. A. a unique number known only to you
B. Investing is riskier than putting money B. written down somewhere so you don’t
in a savings accounts. forget
C. Investing is best for short-term finan- C. an easy to remember number like your
cial goals. birthday
D. Investing is a guaranteed way to make D. the same as the last 4 digits of your
money. phone number
230. To have a at the end of the month, 235. Janet inherited a valuable necklace and
I have to make sure I don’t spend more needs a safe place to keep it when she
than I earn and have some money to save isn’t wearing it,
at the end of the month. A. checking account
A. Income B. savings account
B. Expense C. safe deposit box
C. Balanced Budget D. none of above
D. Savings 236. When I use my debit card at the store,
the money is automatically taken out of
231. Which of the following are examples of my account.
types of savings vehicles?
A. Savings
A. Certificate of Deposit (CD)
B. Checking
B. Money Market Account
C. Inflation
C. Savings Account
D. Withdraw
D. All of the above
237. Service offered by most banks and credit
232. Examples of these types of banks are unions that requires a Personal Identifica-
Wells Fargo, Chase, and Bank of America. tion Number (PIN) to check account bal-
ances, make cash withdrawals and de-
A. commercial banks
posits, and move money from one account
B. credit unions to another.
C. charters A. electronic funds tranfer
D. savings and loans B. electronic financial transitioning
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 710
C. automated teller machine 243. Why does the bank go through account
verification?
D. remote check deposit
A. To make you wait
238. The law that allows for electronic images
B. They don’t like you
of checks to be transmitted for processing
in place of paper checks is C. They need to make sure you are who
you say you are
A. Check 21
D. They want to see if you can be patient
NARAYAN CHANGDER
B. Rule of 72
C. Truth in Lending 244. A user-owned, not-for-profit, coopera-
tive financial institution is called a
D. Going Green Act
A. credit union
239. Taking more money out of your account B. mutual savings bank
than is available is called?
C. savings and loan association
A. Overdraw
D. commercial bank
B. Deposit
C. Withdraw 245. Deposits which are payable after the ex-
piry of a fixed period are called-
D. Balance
A. time deposits.
240. The standard amount of insurance per B.
customer account provided by the FDIC is:
C. NONE
A. $100, 000
D. none of above
B. $1, 000, 000
246. A common financial service used by many
C. $250, 000
consumers. They can help to manage
D. $500, 000 money and make paying bills more conve-
nient.
241. The Federal Deposit Insurance Corpora-
tion (FDIC) insures depositors against los- A. Reconciling
ing their money in the case of a B. Check
A. lost debit card C. Checking Account
B. stolen paycheck D. PIN
C. bank failure
247. What is the meaning of collateral?
D. death in the family A. The legal status of the borrower
242. What are basic banking services? B. The financial worth or accumulated
wealth of the borrower
A. checking accounts
C. Assets which the borrower uses to
B. savings accounts
pledge as security against the loan
C. loan services
D. Associated with the quality in the bor-
D. microcredit rower
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 711
248. What should you do before you approach C. the use of gold as a medium of ex-
an ATM? change
PRACTICE BOOK» NOT FOR SALE
A. Make sure it is hidden so no one will D. the idea that gold can buy everything
see you withdraw money.
253. The item most likely to be stored in a
B. Ask someone nearby for help using the safe-deposit box are
ATM.
A. cash
C. Share a picture of your debit card with
B. bonds and stock certificates
your friends.
C. checkbooks
D. Check for any suspicious people lurk-
ing nearby. D. deposit slips for a savings account
249. All of the following are good check- 254. You will need a PIN to use a(n)
writing habits EXCEPT A. checking account
A. write checks in ink B. debit card
B. void checks on which you make errors C. NOW account
C. always fill in the amount D. personal check
D. postdate all checks 255. Insurance service provided by various
banks is commonly known as
250. Which of the following is TRUE about
checking accounts? A. Investment Banking
A. It is illegal not to have a checking ac- B. Portfolio management
count C. merchant banking
B. Banks can change the fee policies as D. Bancassurance
long as they put the changes in writing and E. Micro Finance
notify you
C. Banks cannot change fee policies, 256. Apps that many depository institutions
once you sign up you are locked in for life have developed that allow online banking
access from devices such as smartphones,
D. Checking accounts are a great way to tablets and other mobile devices
earn interest.
A. App store
251. A prearranged amount of credit that is B. online banking
available for a business to use as needed
C. mobile banking
is a
D. savings banking
A. Line of credit
B. Treasury note 257. An automated service called , pay-
ments such as your paycheck or a tax re-
C. Letter of credit
fund can be electronically transferred into
D. Bond the account you chose.
252. What is the gold standard? A. direct deposit
A. one unit of currency is equal to a set B. automatic transfer
amount of gold C. cancelled check
B. the level by which gold is judged D. automatic deposit
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 712
258. Why do some people invest in hedge D. none of above
funds?
263. If a person makes a deposit of $10, 000
A. Because they want a fund that doesn’t
or more into a bank account, the bank must
diversify
notify the
B. Because they want to invest a small
A. U.S. Treasury Department
amount of money
C. Because they want a fund with less B. U.S. Mint
risk C. Federal Reserve
NARAYAN CHANGDER
D. Because they might may a huge profit D. FBI
259. A bank that provides financial services to 264. Almost percent of U.S. banks are
businesses is a: FDIC members.
A. Commercial Bank A. 50
B. Credit Union B. 75
C. Business Bank C. 90
D. Industrial Bank
D. 99
260. What are profits that are earned from the
sale of an asset like a stock called? 265. An example of a withdraw is:
A. income profits A. In Person
B. capital profits B. At an ATM
C. small gains C. Writing a Check
D. capital gains D. All the Above
261. Which is NOT an example of a Financial 266. What is one type of deduction that em-
Institution for consumers? ployers are required to take from an em-
A. Banks ployee’spaycheck?
B. Credit Unions A. social security
C. The Federal Reserve B. estate tax
D. Insurance Companies C. sales tax
262. What is a Certificate of Deposit (CD)? D. discretionary tax
A. An interest-earning deposit that re- 267. Why is it important to keep an accu-
quires the funds to remain deposited for rate/balanced transaction register?
a fixed term. Withdrawal of the funds be-
A. So you know exactly how much money
fore the term expires results in a financial
you have
penalty.
B. Its not really important if you use on-
B. An interest-earning account that you
line banking
can use to transfer money to checking ac-
counts C. So you can have proof of payment on
C. An account where you can have your your bills
paychecks directly deposited D. So you can have more money
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 713
268. Which type of bond might have been used C. Qiyas
to fund the construction of your school? D. Ijma’
PRACTICE BOOK» NOT FOR SALE
A. Treasury bond
274. Insurance is the way a person or business
B. municipal bond
is protected from:
C. junk bond
A. losing value
D. corporate bond
B. losing investments
269. What is a family most likely to do if they C. losing money
want to purchase a home?
D. losing interest
A. use a credit card
B. get a mortgage 275. When writing a check, it is a good idea to
use
C. open a checking account
A. pencil
D. purchase a certificate of deposit
B. erasable pen
270. If you write a check on a bank to purchase C. blue or black ink pen
a used Honda Civic, you are using money
as: D. red pen
A. A medium of exchange 276. Which of the following bank(s) do(es)
B. a store of value provide loan services to their shareholders
only?
C. a unit of account
A. Commercial bank
D. an economic investment
B. Foreign banks
271. Some checking accounts may require an
C. Private bank
individual do which of the following?
A. Provide proof of income D. Co-operative banks
B. Make an opening deposit E. Industrial Development Bank
C. Pay a fine 277. Debt security that pays interest over a
D. Apply for a personal loan term of ten to thirty years.
A. Treasury note
272. Typically a not-for-profit institution
B. Treasury bill
A. Credit Unions
C. Government bond
B. Commercial banks
D. Security
C. Capital investments
D. CD’s & DDA’s 278. What kinds of money are included in
M1?
273. The actions, words, behavior, or tacit ap-
A. Money market funds
proval of the Prophet Muhammad SAW is
considered to be the B. currency
A. Quran C. savings deposits
B. Sunnah D. small-time deposits
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 714
279. If float averaged $774 million per day in C. Doubtful Assets
2000, and the average in 1995 was 50 D. Loss Assets
percent higher, what did float average per
day in 1995? 285. are/is savings that are put to work
A. 116.1 Million to earn more money.
B. 116100 A. Interest
C. 1.161 Billion B. EFT
NARAYAN CHANGDER
D. 11.61 Million C. Investments
D. Mortgages
280. What service allows you to make pur-
chases with insufficient funds but charges 286. Many famous people don’t spend their
you a hefty fee for each purchase? money wisely and end up in
A. Investment servicing A. Interest
B. Checking extension B. Withdraw
C. Overdraft protection C. Inflation
D. Debt forgiveness D. Bankruptcy
281. Purchases made with your debit card are 287. Experts recommend that you accumulate
usually deducted from your account enough to cover 3 to 6 of expenses in
A. immediately your emergency fund
B. within 24 hours A. Days
C. at midnight B. Weeks
D. within 5 business days C. Months
D. Years
282. When money is saved and used at a later
date. 288. Looking at your checkbook register &
A. Medium of exchange banks statement to make sure the bank’s
records match your own. If they don’t this
B. Divisible
process also involves finding out exactly
C. Store of value why.
D. Payment A. Balancing Your Checkbook / Reconcil-
ing Your Bank Statement
283. A Debit is , while a Credit is
B. Bank Fraud
A. +, -
B. -, + C. Being Extra
C. credit, debit D. Online Banking
D. debit, credit 289. The most common type of bank accounts
284. Those advances which can be recovered A. CD’s and DDA’s
on time are classified as B. Mutual Funds
A. Standard Assets C. Money market accounts
B. Sub-standard Assets D. Savings & Checking accounts
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 715
290. The delivery of financial services electron- C. neither M1 nor M2
ically is called:
D. both M1 and M2
PRACTICE BOOK» NOT FOR SALE
A. E-Business
B. E-Finance 296. The process of transferring money from
one individual or organization to another
C. E-Commerce is
D. none of above
A. monetary policy
291. Money function as: B. medium of exchange
A. A store of value C. financial exchange
B. a unit of account
D. financial services
C. a medium of exchange
D. all of these 297. The type of account where we put them
money for fixed time?
292. All of the following are improper check- A. Fixed deposit account
writing procedures EXCEPT
B. Recurring deposit account
A. overdraw your account whenever pos-
sible C. savings Account
B. avoid making checks payable to D. Current account
“cash”
C. write your checks in pencil 298. What is “interest”?
D. postdate all of your checks A. Direct deposit
B. Specialized savings
293. feels
A. repayments C. Rate earned, compounding method,
fee charged.
B. profits
D. none of above
C. fees
D. exchange 299. Examples of non-banking financial inter-
mediaries
294. You invested your allowance of $270
which gets .15% compounded annually for A. Pusat Zakat
3 years in a savings account. How much B. Tabung Haji
will you have in 3 years?
C. Insurance companies
A. $410.64
D. Investment banks
B. $270.01
C. $282.33 300. Which is not a factor you would consider
when looking for a Bank or Credit union?
D. $271.22
A. Location
295. Money market deposit accounts are in-
cluded in: B. Looks
A. M 1 only C. Free Checking
B. M 2 only D. Services
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 716
301. Banks create money by taking in de- 306. A check that a bank draws on its own
posits, giving out , and charging funds is called a
A. interest, payments A. traveler’s check
B. loans, interest B. cashier’s check
C. payments, loans C. money order
D. debt, loans D. certified check
NARAYAN CHANGDER
302. Safe easy way to pay bills without hav- 307. Why do we pay taxes in our country?
ing to carry cash A. To make our Government rich.
A. minimum balance B. To provide for Public Goods and Ser-
B. checking account vices.
C. interest C. To provide for Goods and Services.
D. savings account D. none of above
308. the concept that money available at the
303. Which of the followings are not consid-
present time is worth more than the iden-
ered as regulatory bodies and policy mak-
tical sum in the future. This core princi-
ers?
ple of finance holds that provided money
A. Bank Negara Malaysia can earn interest, any amount of money is
B. Ministry of Finance worth more the sooner it is received
C. Commercial banks A. Time Value of Money
D. Government agencies B. Time Variance of Money
C. Safety Deposit Box
304. When you evaluate an investment, you
must balance D. The Lottery
A. The interest you will ear with the 309. Which one of the following is not a typi-
prospectus you will gain cal duty of a bank teller?
B. the liquidity involved with the risk you A. balance the cash drawer daily
take B. prepare currency and coin for retail
C. the risks involved with the rewards customers
you expect to gain C. sell savings bonds
D. the diversification you are making with D. manage large sums of money placed
the type of financial intermediary in trust with the bank according to
clients’wishes
305. Which type of bank account typically of-
fers no interest? 310. The Federal Reserve
A. Savings Account A. Regulates the amount of money.
B. Money Market Account B. Supervises Banks.
C. Certificate of Deposit (CD) C. Provides Financial Services.
D. Checking Account D. All of the above.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 717
311. The Fed influences the money supply and 316. When the Fed makes more money avail-
interest rates in the economy to keep this able, interest rates tend to
low and stable-
PRACTICE BOOK» NOT FOR SALE
A. return to normal
A. Supply B. level off
B. Price C. go down
C. Interest D. go up
D. Inflation 317. How are the Dow Jones Industrial and
the S & P 500 similar?
312. A service you can buy where the bank
keeps your valuables safe is A. Both report the daily change in price of
all stocks
A. safe deposit box
B. Both rose in value during the 2007-009
B. vault bear market
C. box of safety C. Both measure how well hunderds of
stocks are doing
D. safety chamber
D. Both track the performance of the
313. What is the reserve deposit ration (rdr)? stock market
A. the proportion of money RBI lends to 318. An account that allows quick access to
commercial banks funds for transactions
B. the proportion of total deposits com- A. online banking
mercial banks keep as reserves
B. savings tool
C. the total proportion of money that com- C. savings account
mercial banks lend to the customers
D. checking account
D. none of above
319. Which type of account should gener-
314. The provisions for presentation of finan- ally be used for ordinary purchases and
cial Statements of banks are given un- monthly expenses?
der Section of Banking Regulation Act,
A. Checking account
1949.
B. Traditional savings account
A. 31
C. Money market account
B. 29
D. Certificate of deposit
C. 50
320. Allows customers to complete certain
D. 18 transactions from a secured internet site
by using a username and password from
315. Currency in circulation is part of:
any place in the world with internet access
A. M 1 only. A. savings tool
B. M 2 not including M1 B. checking account
C. neither M1 nor M2 C. online banking
D. both M1 and M2 D. savings account
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 718
321. This type of money order is typically B. a commodities broker
issues by travel agencies, supermarkets, C. a stockbroker
pharmacies and convenience stores.
D. a day trader
A. express money order
327. If you are estimating your total expenses
B. bank money order
for school next semester, you are using
C. postal money order money primarily as:
D. telegraphic money order A. a medium of exchange
NARAYAN CHANGDER
322. Category 1 of merchant banker can act B. a store of value
as: C. a unit of account
A. All issue management functions D. an economic investment
B. Underwriter 328. Six examples of Non-Deposit Institutions
C. Consultant are Life Insurance Companies, Investment
Companies, Consumer Finance Companies,
D. none of above
Check Cashing Outlets and
323. An account at a depository institution A. Mortgage Companies
that is designed to hold money not spent
B. Restaurants
on current consumption
C. Pawnshops
A. ATM
D. Commercial Banks
B. interest
C. savings account 329. An endorsement that allows the owner
of a check to transfer the right to cash the
D. interest rate check to someone else.
324. Which of the following is not a factor in A. Special
modern banking? B. Restricted
A. mergers C. Blank
B. competition D. Comprehensive
C. communication
330. A purchased certificate used to pay a
D. technology specified amount to a particular payee.
325. Under , the banking institutions are A. Certified checks
required to observe a minimum liquidity ra- B. Cashier’s checks
tio. C. Money orders
A. s 37(1) of the BAFIA 1989 D. Traveler’s checks
B. s 38(1) of the BAFIA 1989
331. When you put money into a checking ac-
C. s 39(1) of the BAFIA 1989 count, you fill out a
D. s 40(1( of the BAFIA 1989 A. signature card
326. If you wanted to purchase shares of a B. reconciliation form
company, whom would you contact? C. deposit slip
A. the New York Stock Exchange D. bank statement
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 719
332. Financial institutions that accept deposits 337. A is a share of ownership in a com-
and make loans are called pany.
PRACTICE BOOK» NOT FOR SALE
A. Exchanges A. bond
B. Banks B. stock
C. Over the counter Markets C. mutual fund
D. none of above D. money market account
333. Scheduled Banks are (multiple choice 338. do not take or hold deposits. They
allowed) earn money selling specific services or poli-
cies.
A. All public sector banks
A. Members
B. All banks
B. Non-Deposit Institutions
C. All cooperative banks
C. Pawn Shops
D. List provided by RBI in Second Sched-
ule under Reserve Bank of India Act, 1934 D. Deposit Institutions
339. When it comes to saving money, what is
334. A can provide legal proof of payment
a good rule of thumb?
A. cancelled check
A. Keep most of your savings in your
B. transaction register checking account
C. bank statement B. Put aside money for savings each
D. internet printout month
C. Choose the savings account with the
335. What is one difference between the New lowest interest rate
York Stock Exchanve and the Nasdaq stock
D. Put anything you can’t afford on your
market?
credit card
A. Nasdaq focuses on new-technology
and technology stockd 340. Bonus Question:What district does the
Atlanta Federal Reserve Bank belong to?
B. Nasdaqs trading floor is in Chicago
A. 5
C. the NYSE serves the over-the counter
market B. 6
D. the NYSE is new and smaller C. 8
D. 9
336. provide services similar to a bank.
The main difference is that a only pro- 341. A sum of money borrowed for a certain
vides these services to its members amount of time is called a
A. title loan A. loan
B. pawn loan B. down payment
C. Credit Union C. interest
D. none of above D. borrow
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 720
342. Which of the below statement is true D. record all of the checks they have writ-
with regard to Auditor of Banks? ten
A. He should acquire knowledge of
client’s business 347. Which type of account allows your de-
posited money to be withdrawn at any
B. He should not have access to books of time by writing a check?
accounts of banks
A. Savings Account
C. He should do routine checking of all
transactions B. Certificate of Deposit
NARAYAN CHANGDER
D. He cannot be a Limited Liability Part- C. Certified Cash Account
nership firm
D. Checking Account
343. is safe storage of funds for future
use. 348. What might happen if the government did
A. Savings Services not insure bank deposits?
B. Payment Services A. Banks would be robbed far more often.
C. Loan Options B. People would lose their savings if their
D. Investment Advice banks went out of business.
C. Banks would have to buy safe with ex-
344. which bank Formulates the monetary pol-
tremely thick metal walls.
icy?
A. Reserve Bank of India D. Banks could no longer make loans to
their customers.
B. Bank of Baroda
C. Canara Bank 349. Buying and selling of government securi-
D. State Bank of India ties by the central bank from/to banks is
called?
345. Delivery of financial services at afford-
A. open market operations
able costs to the disadvantaged Low in-
come segments of the society known as B. margin
C. banking
A. a. Credit creation
D. none of above
B. b. Financial exclusion
C. c. Financial Inclusion 350. Retail Banks
D. D .Consumer credit A. Tailor their services to business
clients.
346. Why do banks send customers a state-
ment of their accounts every month? B. They provide a range of services such
A. reconcile the statement with their as checking, savings and current ac-
check registers counts, loan and mortgage.
B. list all of the debits they have made C. These manage the banking and finan-
with their debit cards cial needs of high net worth individuals.
C. verify their name and address on their D. These banks also offer credit services,
account cash management and trade finance.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 721
351. Which of the following actions would 356. When using your debit card for a pur-
help you lower the risks of investing? chase it is safest to run it as
PRACTICE BOOK» NOT FOR SALE
A. invest more money A. Credit and signing it
B. invest less money B. Debit and entering your PIN
C. invest directly in businesses and avoid C. Its never safe
financial intermediaries
D. Charge and signing it
D. diversify your investments
357. Financial institution that is involved in the
352. There are the derivatives market except..
trading of securities in the financial mar-
A. Commodity Futures ket.
B. KLSE CI Futures A. Securities firm
C. Unit Trust B. Finance company
D. KLIBOR Futures
C. Credit Union
353. When you have taken out more money D. Commercial bank
than you have in your bank account.
A. endorse 358. IFSC Code stands for
B. overdrawn A. Indian Foreign Service code
C. debit card B. Indian Full Service carrier
D. statement C. Instant Free space credit
354. A card sold in specified dollar amounts D. Indian Financial system code
that can be used to purchase products or E. None of these
services
A. Prepaid cards 359. A enables you to withdraw cash from
your account at ATMs or to pay directly for
B. Debit cards goods or services at many businesses.
C. Credit cards
A. credit card
D. Check cards
B. debit card
355. How do banks earn their money? C. NOW card
A. high initial bank account opening fees D. check register
B. allocating customers’ money for daily
expenses and company’s money for quar- 360. Which deposit institution provides sav-
terly bills ings accounts, make loans to individuals
and businesses and offer other services?
C. lending money at higher interest rates
than what they are paying out for savings A. Credit Unions
accounts
B. Mutual Savings Banks
D. circulating printed money into the
C. Savings and Loan Association
economy and keeping a percentage for
daily operations D. Commercial Bank
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 722
361. Which of the following cannot be covered need to carry cash or physical checks to
by insurance? make purchases. BUY NOW, PAY NOW.
A. Fire damage A. Prepaid Card
B. Car accident B. Debit Card
C. Power outage C. Credit Card
D. Lost items D. ATM Card
NARAYAN CHANGDER
362. Fill in the blanks.Hani can withdraw, de- 367. Functions of banks
posit, transfer or pay bills, etc. as many A. Discounting of bills
times as he needs. His bank gives him
B. Hiring safe deposit lockers
A. NSF charge
C. Conducting foreign exchange transac-
B. overdraft protection tions
C. unlimited transactions D. All of the above
D. fee waiver
368. Suppose over the next 10 years the
363. Type of check endorsement that is “for prices of the things you buy double. If your
deposit only” income ALSO doubles, how much will you
be able to buy in 10 years?
A. Blank Endorsement
A. Less
B. Restrictive Endorsement
B. The same
C. Special Endorsement
C. More
D. none of above
D. none of above
364. If you make an error on a check, what
should you do? 369. The Services of banks are called
A. Void the check and write a new one A. Saving account
B. Make corrections and initial the B. Banking
change C. Current account
C. Use whiteout to fix the error D. All of the above
D. Throw the check away and write a new
370. A is type of financial investment is-
one
sued by a corporation, government, or
365. What is a financial statement owned by other organization.
its members called? A. loan
A. bank B. security
B. depository C. banknote
C. money place D. financial exchange
D. credit union 371. a strategy for using money to reach im-
366. is a payment card that deducts money di- portant goals and to advance your finan-
rectly from a consumer’s checking account cial security
to pay for a purchase. cards eliminate the A. savings plan
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 723
B. interest plan A. Personal credit
C. budget B. Financial knowledge
PRACTICE BOOK» NOT FOR SALE
D. none of above C. Financial experience
372. What do we call the amount left over D. Business credit
from your paycheck after taxes and deduc-
tions? 377. This is a bank check you can order in case
A. balance someone doesn’t accept personal checks.
B. gross balance A. Certified Check
C. transaction B. Cashier’s Check
D. net pay C. Coat Check
373. Will needs a better way travel to and D. Cross Check
from work. What type of loan does he
need? 378. Governments can raise money to finance
public spending through the sale of
A. Home equity
A. James
B. Business
C. Auto B. Bonds
D. Mortgage C. Shares
D. Stocks
374. You are opening a savings account that
earns compound interest. Which com-
379. Patrick has bought one too many video
pounding frequency will earn you the
games and has not paid his speeding ticket,
MOST money?
which has to be paid TODAY. He needs
A. Compounding 1 time per year money fast and he can pay it back when he
B. Compounding quarterly gets paid Friday. Which one will he most
likely choose?
C. Compounding monthly
A. Title Pawn
D. Compouding daily
B. Credit Union
375. Everything else held constant, an in-
crease in interest rates on student loans C. Payday Loan
A. increases the cost of a college educa- D. Bank
tion.
380. If you write a check for $100 but you
B. reduces the cost of a college educa-
only have $50 in your account
tion.
C. has no effect on educational costs. A. no one will care until the check comes
to the bank
D. increases costs for students with no
loans. B. you have just overdrafted your account
C. you need to make a deposit before the
376. What can affect whether banks or other
check comes to the bank
financial institutions are interested in of-
fering an individual a loan? D. all of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 724
381. Businesses that provide financial services B. remain unchanged.
A. online banking C. either rise, fall, or remain the same.
B. Depository Institutions D. rise.
C. interest rate
387. Which of the following is NOT a common
D. checking account feature of a financial institution?
382. The Malaysian financial system is struc- A. Access to investment products
NARAYAN CHANGDER
tured into two major categories, Financial B. Paper checks
Institutions and
C. Access to ATMS
A. Financial Supply & Demand
D. Direct deposit
B. Financial Market
C. Financial Management 388. At your request, banks can automatically
perform all of the following services EX-
D. Financial Challenges CEPT
383. I have to pay this when I do not follow A. debit card advances
the rules of the bank B. direct deposits
A. withdrawal
C. loan payments
B. fee
D. transfer between accounts
C. overdraft
389. Which of the following financial institu-
D. deposit
tions typically have the highest fees?
384. Money that financial institutions lend to A. Check cashing and payday loan compa-
others nies
A. creates more jobs B. Credit unions
B. reduces spending by consumers C. Brick-and-mortar banks
C. causes interest rates to decline D. Internet banks
D. lower taxes
390. Money is widely accepted as a method of
385. When there is a fundraiser at school, it is payment.
much easier to pay with a instead of A. store of value
handing a student cash or my credit card
information. B. unit of account
A. Overdraw C. medium of exchange
B. Withdraw D. commodity
C. Check 391. A mutual fund is
D. Savings A. A type of debt investment that acts like
386. Everything else held constant, a decline in a loan.
interest rates will cause spending on hous- B. A share of ownership in a company.
ing to C. A type of investment that invests in a
A. fall. mix of different types of investments.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 725
D. A type of savings account that pays in- 397. Merchant banking activities was origi-
terest based on current interest rates in nated with the merchant banking division
the money market. set by
PRACTICE BOOK» NOT FOR SALE
392. receipt showing that an investor has A. yes bank
made an interest-bearing loan to a finan- B. Grinds bays bank
cial institution
C. none of the above
A. Certificates of deposit
D. none of above
B. Loan
C. Funds 398. The Federal Reserve Bank has dis-
tricts.
D. none of above
A. None
393. What is an ATM used for?
B. 9
A. Withdraw money
C. 12
B. Apply for a loan
C. Make electronic payments D. 15
D. Reconciling your account 399. An important financial institution that as-
sists in the initial sale of securities in the
394. Which deposit institution is user-owned,
primary market is the
not-for-profit, cooperative financial insti-
tution often formed by people in the same A. Investment Bank
company, labor union or profession? B. Commercial Bank
A. Credit Unions
C. Stock Exchange
B. Mutual Savings Banks
D. none of above
C. Savings and Loan Association
D. Commercial Bank 400. Fee for writing a check for more money
than you have in your account.
395. Which type of financial institution plays
A. Monthly Service Fee
the largest role in the economy?
B. Maintenance Fee
A. credit unions
B. savings banks C. APY
C. savings and loan associations D. Overdraft/NSF Fee
D. commercial banks 401. According to the segment, which of the
396. Banks offer different kinds of accounts following financial institutions commonly
because: disperse loans for home repairs, construc-
tion and refinancing?
A. Different customers have different
needs A. Commercial banks
B. They have to by law B. Brokerage firms
C. It seems like the fun thing to do C. Savings and loan associations
D. They are greedy D. Insurance companies
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 726
402. When the same funds are counted in two 407. To use an online bank account you will
depository banks, the funds are called need access to
A. float A. An ATM
B. bounced B. The high street branch
C. postdated C. A mobile phone
D. The Internet
D. returned
408. Rate of interest which changes regularly
NARAYAN CHANGDER
403. Person who owns a share or shares of
A. Fixed Interest Rate
stock in a corporation; same as stockhold-
ers B. Savings
A. Bank C. Interest
D. Variable Interest Rate
B. Stock
C. Shareholder 409. Fee charged to borrow money
A. Inflation
D. none of above
B. Interest
404. The largest source of fees for banks when C. Discount rate
it comes to checking accounts is
D. Reserve requirement
A. Maintenance Fees
410. The new issues market is also known as
B. Paper Statement Fees
C. Overdraft Fees A. Stock Exchange
D. None of the answers are right B. Primary Market
C. Money Market
405. Which of the following is not characteris-
tic of personal loan? D. Secondary Market
A. Personal loans are usually between 411. Bank Negara Malaysia holdings interna-
RM1, 000 to RM100, 000 tional reserves in the form of
B. Any individual above 18 years old can A. ringgit and sen
apply for the loan B. gold, foreign exchange assets and in-
C. The loan is normally paid based on vestments
monthly installments C. safe custody
D. Normally, has a maturity between 6 D. printing of currency notes and the
months to 3 years and more minting of coins
412. Which government agency or department
406. matching your checkbook balance with
is in charge of determining how much
the bank’s balance is called:
money is in circulation?
A. paying bills A. The Treasury
B. calling a loan B. The Federal Reserve
C. reconciliation C. The Department of Commerce
D. overdrafting D. The Bureau of Economic Analysis
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 727
413. Any organization that provides services 418. What helps you have higher approval
related to money is a rates for loans and credit cards?
PRACTICE BOOK» NOT FOR SALE
A. corporation A. Good credit
B. business B. Poor credit
C. store C. No credit
D. financial institution D. none of above
414. An independent agency created by the 419. Form you fill out to put money in your
federal government to protect bank cus- account.
tomers by insuring their deposits. A. withdrawal
A. FBI B. deposit slip
B. Financial Depository Insurance Com- C. service charge
pany D. deposit
C. Federal Deposit Insurance Corpora-
420. What is a Cash Loan based on?
tion
A. What banks a person gives business to
D. Financial Department of Insurance
Corporation B. The creditworthiness of someone
C. Collateral given for the loan
415. All of the following describe the opera-
tions of a bank EXCEPT D. How often someone deposits money
into their bank account
A. pay a small amount of interest on
money deposited 421. Money the bank pays you to keep your
B. borrow money from the government money in their bank.
C. make various types of loans A. minimum balance
B. checking account
D. offer direct deposits
C. interest
416. Banks create money by taking in de-
D. savings account
posits, making , and charging
A. interest, payments 422. Which type of check endorsement begins
with “Pay to the order of Marcia Bernas
B. loans, interest
C. payments, loans A. blank
D. debt, loans B. restrictive
417. Reducing risk through the purchase of as- C. special/full
sets whose returns do not always move D. none of above
together is
423. A credit union differs from other financial
A. Intermediation
institutions in that it is
B. Discounting
A. organized as a not-for-profit organiza-
C. Diversification tion
D. none of above B. taxed at a different rate
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 728
C. owned by foreign investors 429. The French word Banque means
D. chartered by the federal government A. Money Exchange Table
B. House Exchange Table
424. A business or financial institution that
stores and manages money for individuals C. Jewellery Exchange Table
and other businesses: D. None of the above
A. ATM
430. Who developed microcredit?
B. Bank
NARAYAN CHANGDER
A. Muhammad Ali
C. Credit Union
B. Medici family
D. Check Cashing Center
C. Muhammad Yunus
425. What are you typically required to fill out D. group of women from Bangladesh
first before you can rent an apartment?
431. Typically, borrowers have superior infor-
A. credit application mation relative to lenders about the poten-
B. homeowner application tial returns and risks associated with an
C. sales application investment project. The difference in in-
formation is called
D. rental application
A. Moral Selection
426. A(n) has nonprofit status and is B. Risk Sharing
owned by its members.
C. asymmetric information
A. investment company
D. none of above
B. savings bank
432. Which bank is not under IBA?
C. credit union
A. Maybank Islamic Berhad
D. securities firm
B. CIMB
427. What is the fee called when there is not C. Public Islamic
enough money in your checking account to
cover the check? D. Bank Muamalat
A. bad check 433. Which account is commonly opened by
students senior citizens and pensioners?
B. fee
A. Current account
C. overdraft
B. Fixed deposit account
D. good check
C. Recurring deposit account
428. An exchange of goods or services for
D. Savings account
other goods or services without using
money. 434. The amount of money in your account
A. bargain shopping A. DEPOSIT
B. barter B. BENJAMINS
C. thrift shopping C. BALANCE
D. begging D. DOLLARS
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 729
435. type of account is by salaried person, 440. Offer loans with high finance charges to
students desperate borrowers.
PRACTICE BOOK» NOT FOR SALE
A. Current account A. Pawnshops
B. Savings Bank account B. Banks
C. Term or fixed deposit account C. Savings and loan Companies
D. Recurring deposit account D. Credit Unions
441. U.S. government agency which insures
436. IPO stands for your bank account up to $250, 000
A. Inexpensive Public Offices A. IRS Protection
B. Initial Public Offering B. DHS Protection
C. Initial Public Expenses C. FDIC Protection
D. Inedible Putrid Offal D. SS Protection
437. Which deposit institution is owned by 442. A signature on the back of a check that en-
and operated for the benefit of its deposi- titles the payee to either receive payment
tors? or transfer it to someone else
A. Credit Unions A. endorsement
B. signature
B. Mutual Savings Banks
C. verification
C. Savings and Loan Association
D. autograph
D. Commercial Bank
443. A blank endorsement on a check
438. Which of the following should you do
A. has no effect on the check
when writing a check?
B. cancels the check
A. Use a pen
C. creates a check that can be cashed by
B. Use a pencil anyone
C. Write legibly D. restricts the use of the check
D. Just sign a check and hand it over
444. Mobicash Easy is a mobile wallet which
E. Write VOID across the check if you offers facilities such as fund transfer, bill
mess up payment, balance enquiry, mini statement,
mobile top-ups and DTH recharge. This fa-
439. The most common position at banks is cility has been introduced by which of the
called following banks?
A. loan officer A. State Bank of india
B. teller B. HDFC Bank
C. customer service representative C. Corporation Bank
(CSR) D. Union Bank of India
D. financial planner E. ICICI Bank
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 730
445. A(n) is an example of a nondeposi- C. deposits
tory financial institution. D. banks can’t carry liabilities
A. credit union
450. The difference between interest paid and
B. mutual savings bank
interest received
C. insurance company
A. asset
D. commercial bank
B. equity
446. A non profit financial cooperative owned
NARAYAN CHANGDER
C. profit
by and operated for the benefit of its mem-
bers; services offered only to its members. D. spread
A. Commercial Banks 451. Which of the following is a non-deposit
B. Credit Union financial institution?
C. Savings and Loans Associations A. mutual savings bank
D. Federal Deposit Insurance Corpora- B. credit union
tion
C. life insurance company
447. Which of the following is generally true D. savings and loan association
about financial intermediaries?
A. Intermediaries are government agen- 452. Why do some people invest in bonds with
cies a low intrest rate?
B. Intermediaries channel money from in- A. the investor may want a low-risk in-
vestors to savers vestment
C. Intermediaries increase the level of B. the investory may want to make a high
risk for investors yield
D. Intermediaries provide information to C. the investor may want an investment
savers and investors with a low credit rating
448. What should you do before you withdraw D. the investor may want a bond that ma-
money from the ATM? tures in 20 years
A. Ask someone nearby for help using the 453. A Check Cashing Center provides service
ATM. to someone who DOES NOT have a:
B. Find a hidden ATM so no one will see A. Savings Account
you withdraw money.
B. ATM Card
C. Inspect the ATM to make sure it wasn’t
tampered with. C. Bank Account
D. Share your pin number with trusted D. Checking Account
friends so you don’t forget it.
454. What means Wakalah?
449. Which of the following is considered a li- A. A contract of agency between the prin-
ability for a bank? ciple and the agent.
A. loans B. A contract of benevolent loan between
B. investments the lender and the borrower.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 731
C. A contract of remittance or transfer 459. Single people earning less than $50, 000
fund/debt between depositor and credi- per year, will most likely use the
tor.
PRACTICE BOOK» NOT FOR SALE
A. 1040A Form
D. A contract of leasing between the B. 1040EZ Form
owner of goods or asset.
C. W-2 Form
455. Credit unions are able to offer better in- D. 1040 Form
terest rates because
460. Which type of account is easiest to ac-
A. Credit unions are not supervised and cess?
canmake their own rules.
A. CD
B. They are privately owned and run by a
B. Checking Account
board of directors.
C. Savings Account
C. They have an agreement with the U.S.
Treasury Department. D. Money market account
D. They are member owned and want to 461. What’s left of revenue after costs are de-
offer better services to their members. ducted
456. Markets in which funds are transferred A. asset
from those who have excess funds avail- B. equity
able to those who have a shortage of avail- C. profit
able funds are called
D. spread
A. commodity markets.
462. In what type of market is money lent for
B. fund-available markets. periods longer than a year?
C. derivative exchange markets. A. money market
D. financial markets. B. secondary market
457. Financial advisors typically recommend C. primary market
an individual has enough savings to cover D. capital market
at least months worth of bills.
463. Which of the following types of Financial
A. One to two Institutions has this unit mainly focused?
B. Three to six A. Commercial Banks
C. Six to eight B. Savings & Loans Associations
D. 12 to 18 C. Credit Unions
458. A person employed to deal with cus- D. Brokerage Firms
tomers’ transactions at a bank such as tak- 464. Money is something I can trust to keep
ing deposits or cashing checks. its value over time.
A. Penn A. unit of value
B. Teller B. store of value
C. Count C. medium of exchange
D. Cashier D. unit of account
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 732
465. Which of the following is not a fee-based 470. Fill in the blank.Lucy’s employer doesn’t
financial service? giver her a pay cheque. Instead, her pay
A. Corporate counseling goes into her bank account. She uses
because it is convenient.
B. Lease financing
A. direct deposit
C. Issue management
B. account balance
D. Profit management
C. NSF charge
NARAYAN CHANGDER
466. Which part of the check is the least im-
D. minimum balance
portant?
A. memo line 471. Savings account, checking and payment
accounts, loans and other credit plans and
B. signature line
other services such as safe-deposit boxes
C. routing numbers and investment advice are all examples of:
D. check number A. Savings and Loan Companies
467. A wire transfer is B. Government Agencies
A. a financial transcation that electroni- C. Banking Services
cally moves funds from one bank to an- D. Credit Unions
other
B. moving money from one account to an- 472. Lets you borrow money from the bank
other but you have to pay back the loan in 20
to 30 days without being charged interest
C. paying your bills online using your com-
puter A. Credit cards
D. the electronic connections used to ac- B. loans
cess your account C. Banks
468. Which of the following best describes a D. none of above
LOAN?
473. If your checkbook is stolen
A. Money borrowed that can be paid back
if one feels like it. A. your name could be forged and used to
purchase items without your consent
B. Money borrowed
B. all the checks are automatically voided
C. Money borrowed with the expectation
of paying it back in a timely manner. C. it doesn’t matter since the thief
doesn’t know how you sign your name
D. Money gifted to someone with no ex-
pectation of payback. D. the thief can access all of your ac-
counts
469. The primary liabilities of a commercial
bank are 474. A common name for U.S. currency is
A. Bonds A. orange backs
B. Mortgages B. yellow backs
C. Deposits C. blue backs
D. none of above D. green backs
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 733
475. Interest helps allocate savings to its most 480. What is one difference between Banks
productive use by and Credit Unions?
PRACTICE BOOK» NOT FOR SALE
A. limiting risk A. Banks have Checking accounts and
B. directing households to save or invest Credit Unions have Savings Accounts
C. transferring money from borrowers to B. Banks are for profit. Credit Unions are
savers Non-profit.
D. providing money for business improve- C. Banks can give loans and Credit
ments Unions cannot
D. Credit Unions allow everyone to join
476. Money on deposit, minus , can be
and Banks are selective
loaned by banks to customers.
A. primary reserves 481. The time and money spent in carrying out
financial transactions are called:
B. the reserve requirement
A. Liquidity Services
C. cash on hand
D. excess reserves B. Transaction costs
C. Economies of scale
477. One result of competition among banks is
that D. none of above
A. the trend toward mergers in the bank- 482. To put money into an account.
ing industry has slowed
A. Deposit
B. more banks banks exist now than a
B. Withdraw
decade ago
C. Savings for a chicken
C. more services are available to con-
sumers D. Interest for a cow
D. all of the answers. 483. A computer based system that moves
478. Anything that’s accepted in exchange for money from one account to another. Di-
goods & services. rect deposit, having a bill draft from your
checking account, and moving money from
A. Currency savings to checking are all examples.
B. Money A. Electronic Funds Transfer
C. Liquidity B. Gringotts Bank
D. Deferred Payment C. Bank of Mom and Dad
479. A line of credit is: D. NSF Services
A. must be backed by collateral
484. What kinds of financial assets are sold on
B. is not readily available to the bank cus- secondary markets
tomer
A. Stocks
C. a pool of available money that you can
B. small certificates of deposit
borrow
D. a Master Card or Visa offered by a C. savings bonds
bank D. capital markets
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 734
485. Usin the Rule of 72, how long would it A. Underwriting
take for money to double at an 8 percent B. Loan Syndication
interest rate?
C. Issue Management
A. 9 years
D. none of above
B. 72 years
C. 8 years 491. To bring the bank statement and your
own record of transaction into agreement
D. 18 years
NARAYAN CHANGDER
A. Reconcile
486. When depositing money into an account,
B. Balance
it is important to:
C. Review
A. include your account number
D. Check for errors
B. swipe your credit card
C. thank the teller 492. It is a computerised database system de-
veloped and maintained by BNM to col-
D. sign your deposit ticket
lect, process, store, and generate informa-
487. A license authorizing a bank to operate tion.What is this?
usually called national banks. A. Credit Tip Off System
A. Certificate B. Central Credit Reference Information
B. FDIC System
C. Savings and Loans association C. Dishonoured Cheque Information Sys-
tem
D. Charter
D. Block Discounting
488. What agencies insure banks and credit
unions? 493. Plastic card that allows the holder to
make credit purchases up to an authorized
A. IRS and DHS
amount.
B. DHS and FDIC
A. Debit card
C. FDIC and NCUA
B. Credit card
D. NCUA and FICA
C. Line of credit
489. Using the rule of 72, how long would it D. Government bond
take for your money to double at a 4 per-
cent interest rate? 494. This institution requires you to be a mem-
ber
A. 18 years
A. Banks
B. 4 years
C. 9 years B. Credit Unions
D. 36 years C. Savings and Loans
D. Payday Loan Company
490. service is offered by the merchant
banker to get term loan for project, help 495. The National Credit Union Administration
client make appraisal, designing capital (NCUA) regulates which depository insti-
structure etc tution?
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 735
A. Credit Unions A. ATM Card
B. Mutual Savings Banks B. Savings Account
PRACTICE BOOK» NOT FOR SALE
C. Savings and Loan Association C. Debit Card
D. Commercial Banks D. Cash Card
496. Prearranged amount of credit that is E. Credit Card
available for a business to use as needed.
501. The amount of money in an account can
A. Government bond be defined as:
B. Line of credit A. Your Dough
C. Medium of exchange B. Money Level
D. Checking account
C. Account Amount
497. An 8th grader makes and sells earrings D. Account Balance
as a way to earn extra money. The money
she gets is considered 502. Which of the following is a job of the Fed-
eral Reserve?
A. Needs
B. Wants A. Insure the safety of deposits.
C. Income B. Regulate inflation so it doesn’t get out
of control.
D. Expenses
C. Acts as the Governments Bank.
498. Which of the following is a written or-
D. All of the above.
der from you to your bank instructing your
bank to pay money from your account to 503. If your bank statement and personal
another party? transaction register do no match, you
A. A check should do all of the following EXCEPT
B. A deposit slip A. erase your balance and put in the bank
statement amount since that is correct
C. A certificate of deposit
D. A debit card B. check to be sure that you didn’t miss
anything
499. Approximately how often does a finan- C. double check your math
cial institution send a bank statement to
an account holder? D. take your records to the bank for assis-
tance
A. yearly
B. weekly 504. Brooke is smart, financially stable, and is
looking for a loan that offers a low inter-
C. quarterly
est rate and not much risk. Where should
D. monthly she apply for a loan at?
500. Amelia receives a card from her finan- A. Title Pawn
cial institution that allows to her use B. Payday Lender
an ATM for depositing and withdrawing
money, checking her account information, C. Bank
and more. Amelia has a what? D. Credit Union
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 736
505. How can you avoid spending more than 510. What are smart cards?
what is in your bank account? A. Debit or credit cards with a microchip.
A. Check your bank statement once a B. Debit cards you can not steal.
month.
C. Credit cards.
B. Ask your financial institution to notify
you when you are close to $0 in your ac- D. none of above
count.
511. Sets out the regulatory framework for
NARAYAN CHANGDER
C. Keep your own records to compare Malaysia’s Islamic financial sector
with your financial institution’s records. A. Islamic Financial Service Act 2013
D. None of the above B. Islamic Financial Service Act 2012
506. Which financial institution is insured by C. Islamic Financial Service Act 2011
NCUA? D. Islamic Financial Service Act 2010
A. commercial banks
512. Form of business organization recognized
B. credit unions by law as a separate legal entity with all
rights and responsibilities of an individual,
C. savings and loans
including the right to buy and sell legal
D. none of above property, Enter into legal contracts, sue
and be sued
507. Which is not an example of a stored-
value card? A. Shareholder
B. Corporation
A. gift card
C. stock
B. credit card
D. none of above
C. phone card
D. Subway smart card 513. a certificate, usually issued by a govern-
ment or banking institution, that allows
508. for profit the stated payee to receive cash on de-
mand. Functions in a similar way to a
A. fee cashier’s check but available for purchase
B. for profit at more locations (post office, gas station,
etc). Be careful, they are at high risk for
C. not for profit
fraud!
D. profit A. Cash on Demand
509. Approximately how often does a finan- B. Money Order
cial institution send a bank statement C. IOU
through the mail?
D. Promissory Note
A. yearly
514. In defining money as M1, economists ex-
B. weekly
clude time deposits because:
C. quarterly
A. the intrinsic value of time deposits is
D. monthly nil
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 737
B. the purchasing power of time deposits C. Forged
is much less stable than that of checkable D. Outstanding
deposits and currency
PRACTICE BOOK» NOT FOR SALE
C. they are not directly or immediately a 520. When you borrow money from a bank,
medium of exchange where does that money come from?
D. . they are not recognized by the Fed- A. The accounts of the bank’s customers.
eral government as legal tender B. The bank’s own business checking ac-
count
515. A(n) check is a check that is dated
later than the date on which it is actually C. A credit card company
written. D. The federal government
A. bounced 521. are financial instruments whose
B. postdated value is derived from other underlying as-
C. returned sets.
D. bank A. Derivatives
B. Mutual Funds
516. Banks are
C. Insurance
A. Financial institutions
D. none of above
B. Agriculture institutions
522. Which is the best description of a ‘money
C. Commercial institutions
market’
D. Social institutions
A. Made up of all those people and organ-
517. Involves guiding people on the best ways isations who want money and all the peo-
to manage, invest or use their money ple and organisations who are willing and
able to supply money.
A. financial counseling
B. Any place where buyers and sellers
B. depository institution
come together.
C. FDIC
C. The money used to pay for goods and
D. loan services
518. A bank can sell only those NPA’s which re- D. A bank at which people can open an ac-
mained NPA for more than year/years count at.
A. 5 523. The price paid for using someone else’s
B. 4 money
C. 3 A. interest rate
D. 2 B. debit card
C. credit card
519. What type of check has been written
but not yet returned to the bank for pay- D. interest
ment? 524. is money added to a checking or sav-
A. Cleared ings account.
B. Stale A. Withdraw
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 738
B. Check C. to provide money for local government
C. Put in money to finance public schools
D. Deposit D. to provide money for individuals who
are willing to take high risks
525. Under section 38(1) of the BAFIA 1989,
the banking institutions are required to 530. Anything of value that is accepted in re-
maintain a turn for goods or services is
A. Reserves ratio A. products
NARAYAN CHANGDER
B. Intermediate liquidity ratio B. credit
C. Minimum liquidity ratio C. money
D. Maximum liquidity ratio
D. cash
526. The ease with which investment can be
converted into cash is 531. Marisol has written a $500 check to
Stephen, but she has only $300 in her ac-
A. low risk count and it is returned unpaid to Stephen.
B. low return Marisol has written a
C. easement A. floating check
D. liquidity B. promissory note
527. A company owned by families or a small C. postdated check
number of investors and do not issue stock D. bounced check
to the public.
A. public company 532. Checkable deposits are classified as
B. industry money because
C. private company A. They can be readily used in purchasing
goods and paying debts
D. portfolio
B. banks hold currency equal to the value
528. A savings bank is a financial institu- of their checkable deposits
tion owned by the depositors, to whom
C. they are ultimately the obligations of
the profits go.
the Treasury
A. federal
D. they earn interest income for the de-
B. depositors positor
C. mutual
533. A document where you record all checks
D. commercial
and deposits and debit transactions for a
529. What is the function of a municipal checking account is called a
bond? A. check register
A. to provide money for a firm to expand
B. bank statement
its business
C. bank form
B. to provide money for the federal gov-
ernment to pay its debts D. deposit slip
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 739
534. Auditor of SBI is appointed by 540. Which of the following situations would
A. Shareholders we sign the deposit slip?
PRACTICE BOOK» NOT FOR SALE
B. Central Govt. A. Deposit Checks
C. CAG B. Deposit Cash
D. BOD C. When you deposit amounts over $100
535. Which of the following is an example of D. When you are taking cash out of the
a Private Financial Institution? deposit
A. Walmart
B. Best Buy 541. Fill in the blanks with a correct word.
Miriam has her own bank account. She is
C. Wells Fargo the
D. The Federal Reserve
A. account balance
536. Companies that give out small loans in re-
B. joint account
turn for a portion of an upcoming paycheck.
They generally charge much higher interest C. bank statement
on loans than other institutions.
D. account holder
A. title loan
B. pay day lender 542. All financial institutions are regulated by
what agencies?
C. credit union
D. mortgage broker A. Federal and State Agencies
537. The largest stock exchange in the world B. Country Agencies
is C. Government Agencies
A. LSE
D. Banking Agencies
B. Korea Exchange
C. Shanghai Stock Exchange 543. What is the largest source of funds for
banks?
D. NYSE
A. escrow account
538. How do banks help businesses?
A. making loans B. donations
B. issuing credit cards C. interest
C. sharing profits D. deposits
D. issuing insurance
544. is a written order to a bank to pay a
539. What does the bank send you at the end stated amount to the specified recipient.
of the month?
A. Cash
A. Bill
B. Payment Order
B. Bank Statement
C. Extra Money C. Check
D. Junk Mail D. Credit Card
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 740
545. What do you call the process of bringing 550. Money used in exchange for goods and
your checkbook register into agreement services needed by individuals, businesses,
with the bank statement? and governments.
A. Withdrawal A. Store of value
B. Deposit B. Unit of value
C. Reconciliation C. Bond
D. Medium of exchange
D. Endorsement
NARAYAN CHANGDER
551. The percentage rate used to calculate in-
546. Which would somebody use to withdraw terest
money from a checking account?
A. percentage
A. stored-value card
B. rate of return
B. debit card C. interest rate
C. credit card D. interest accrual
D. gift card
552. formulates the monetary policy
which should be followed by all banks
547. When an employee’s paycheck is auto-
matically added to their bank account A. Canara Bank
A. Direct Deposit B. Vijayawada Bank
B. Automatic Payment C. Reserve Bank of India
D. Corporation Bank
C. Debit Card
D. FDIC 553. Which type of account generally has the
highest APY and requires the depositor to
548. Which of the following financial services “lock away” money for a time?
is best suited for saving money over a pe- A. Checking account
riod of years?
B. Traditional savings account
A. Certificate of Deposit C. Money market account
B. Demand Deposit D. Certificate of deposit
C. Checking Account
554. Who insures bank deposits?
D. Mortgage Loan A. U.S. Treasury Department
549. Member deposits into credit unions are B. FDIC
insured by which of the following organi- C. Federal Reserve
zations?
D. NCUA
A. National Credit Union Agency (NCUA)
555. Your 2 year investment of $5, 300 earns
B. Federal Deposit Insurance Corpora- 2.9% and is compounded annually . What
tion (FDIC) will your total return be?
C. Federal Reserve (FED) A. $5, 304.46
D. US Treasury Department (USTD) B. $5, 611.86
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 741
C. $5, 613.28 560. The process of determining standards and
procedures for dealing with judgmentalde-
D. $8, 819.73
cisions affecting other people is called:
PRACTICE BOOK» NOT FOR SALE
556. Name one advantage of bonds for their A. mission
issuers
B. standards
A. Bondholders can’t share in the profits
C. ethics
of a company
D. courtesy
B. Issuers must make fixed income pay-
ments even when it doen’t make a profit 561. What is the name of Central Bank in In-
C. Issuers can’t change interest pay- dia?
ments even when rates have dropped A. SBI
D. Bonds have the potential to be down- B. RBI
graded
C. PNB
557. Interest is D. none of above
A. A reward for saving and a reward for
borrowing 562. BNM commenced to issue its own cur-
rency on , 1967
B. A cost of saving and a reward for bor-
rowing A. June 12
C. A cost of borrowing and a cost of sav- B. August 12
ing C. September 12
D. A reward for saving and a cost of bor- D. Oktober 12
rowing
563. Computer and electronic technology in
558. What does the FDIC? place of checks and other paper transac-
A. Federal Deposit In Corporations tions
B. Financial Depositing In Communities A. Electronic fund transfer
C. Financing Depositing Insuring Corpo- B. cards
ration C. Bank
D. Federal Deposit Insurance Corpora- D. none of above
tion
564. Whenever you authorize someone to au-
559. An automatic loan made to an account if tomatically take money out of your ac-
the balance will not cover the checks writ- count to satisfy a financial obligation, you
ten, debit card purchases are using a
A. Overdraft protection A. cashier’s check
B. Collateralized loan B. bank draft
C. Title loan C. money order
D. Payday loan D. certified check
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 742
565. What is the name of a legal document 570. A key factor in producing high economic
that functions like cash? growth is
A. Check A. eliminating foreign trade.
B. ATM B. well-functioning financial markets.
C. Deposit slip C. high-interest rates.
D. PIN D. stock market volatility.
NARAYAN CHANGDER
571. They make loans based on the value of
566. The type of account which can be com-
jewelry or some other valuable item.
monly opened by businessmen?
A. consumer finance companies
A. Current account
B. pawn shops
B. Savings account
C. check-cashing outlets
C. Recurring deposit account
D. investment companies
D. Fixed deposit account
572. The Federal Reserve maintains the of
567. Which of the following insures checking our currency.
accounts at a bank or a credit union? (you
A. value
must choose more than one) HINT:there
are two correct answers B. design
A. NCUA C. trading
B. FDIC D. color
C. FTIC 573. A card issued by a bank that allows
the holder to check account balances,
D. NAACP
withdraw and deposit cash, and transfer
568. Which one of the following is not a money from one account to another using
bank? an ATM.
A. Bank of America A. ATM card
B. ID card
B. EECU
C. credit card
C. Frost Bank
D. debit card
D. Bank of the United States
574. Financial institution that offers savings
569. Which non-deposit institution specialize and loan services. Also called “thriftys”
in making loans for long-lasting or durable
goods and for financial emergencies? Ex- A. Nondepository institution
amples:FORD Financing, TOYOTA Financ- B. Depository institution
ing C. Savings and loan institution
A. Life Insurance Companies D. Credit union
B. Pawn Shops
575. Money the banks make you pay for
C. Consumer Finance Companies breaking the rules
D. Investment Companies A. withdrawal
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 743
B. deposit slip 581. The Indian postal department is planning
C. service charge to start a bank to be tentatively called the
PRACTICE BOOK» NOT FOR SALE
D. deposit
A. Postal bank of India
576. What type of endorsement is the most B. Central bank of India
secure?
C. State bank of Mysore
A. Blank Endorsement
D. Canada bank
B. Restrictive Endorsement
C. Endorsement in Full 582. An increase in interest rates might
saving because more can be earned in in-
D. Full Endorsement
terest income.
577. Contains the checks and the check regis- A. encourage
ter:
B. discourage
A. Check
C. disallow
B. Checkbook
D. invalidate
C. Check Register
D. none of above 583. an issue that arises when an account
holder seeks to make a purchase or clear a
578. Frank has ten dollars. If he does not check that their account cannot cover with
spend any of the money, it will keep its the funds available. may also be referred
worth of ten dollars. How is that using to as “non-sufficient funds, “ or “NSF”
money?
A. Insufficient Funds
A. A medium of exchange
B. Promissory note
B. A unit of measure
C. Not Your Best Life
C. A store of value
D. Electronic Funds Transfer
D. none of above
584. The memo line on a check is
579. The most likely computer management
tool for financial forms is: A. Where you sign your name
A. PowerPoint B. Optional
B. database C. Where you should write the amount
C. word processing D. Where you should write the check num-
D. spreadsheet ber
580. Your money is insured for up to how much 585. An organization that provides services re-
when kept in a bank or credit union? lated to money.
A. $250, 000 A. commercial bank
B. $200, 000 B. charter
C. $150, 000 C. financial institution
D. $100, 000 D. insurance company
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 744
586. Todd goes to a bank in order to get a Car 591. The most common & safest financial insti-
Loan so he can buy a car. What is he going tution
to give the bank as collateral? A. savings & loan
A. Savings account
B. commercial bank
B. Car title
C. federal depoisitory
C. Real estate
D. CD’s & DDA’s
D. His wedding ring
NARAYAN CHANGDER
592. The first ever Islamic financial institu-
587. The stock market is a physical place. tion established in the 1960s outside the
A. Yes, it’s located in most major cities MENA region is:
around the world. A. Mit Ghamr Savings Bank
B. No, trading is all done online. B. Dubai Islamic Bank
C. Yes and No, there are physical places C. Bank Islam Malaysia
where stocks are sold, but they are also
sold virtually. D. Tabung Hajj Malaysia
D. none of above 593. Which statement is true of a bank?
588. When you are making payments on a car A. for-profit institution owned by share-
and/or house you have a holders
A. Withdraw B. generally offers lower fees and inter-
est on loans than credit unions
B. Bankruptcy
C. known for providing more personal-
C. Debt ized service
D. Overdraw D. accepts only members who meet cer-
tain qualifications
589. What is a SAVINGS ACCOUNT?
A. a bank account that you cannot deposit 594. Which of the following ways you can de-
your money from for a specific amount of posit into your account.
time A. Direct Deposit
B. a bank account that you can write
B. Online Deposit
checks from
C. Deposit Slip
C. a bank account that earns interest
D. Mail the check into the bank
D. none of above
E. Writing a check
590. Deposits are insured by the Federal De-
posit Insurance Corporation up to per 595. The contract in Islamic banking that is re-
depositor. lated to the agricultural goods is:
A. $100, 000 A. Istisna’
B. $150, 000 B. Musharakah
C. $200, 000 C. Salam
D. $250, 000 D. Ijarah
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 745
596. What is the advantage of leasing? 601. What does Inflation do to the value of
money?
A. Provides 100% financing
PRACTICE BOOK» NOT FOR SALE
A. Makes it go up.
B. No ownership
B. Makes it go down.
C. Lease rental payments are long-term
expenses C. Makes it stay the same.
D. Cost of maintaining the asset may be D. none of above
borne by the lessee
602. Well-functioning financial markets pro-
597. Which one of the the below options is not mote
a characteristic of Bank? A. inflation.
A. Lending loans B. deflation.
B. Withdrawal and payment C. unemployment.
C. Accepting deposits D. economic growth
D. Mutual funds 603. Which are not the benefits of factoring?
598. Which of the following is NOT one of the A. Financing the supplier
Fed’s overall goals? B. Maintenance of the receivables ac-
A. To stabilize prices count
B. To encourage economic growth C. Provide 100% financing
C. To maintain interest rates D. Protection against default in payment
by account receivable
D. To encourage full employment
604. What is goal of FSA?
599. How do banks make a profit on loans?
A. Maintain financial stability
A. over-charging customers
B. Control of system for the electronic
B. greedy profit capitalists transfer of funds
C. by charging higher interest on loan C. Mainly provides for the licensing and
paybacks than they pay interest on sav- regulation of Islamic banking business in
ings Malaysia.
D. banks usually lose money on loans D. To increase money
600. Once money is “loaded”, it can be used 605. All of these are basic reasons to put your
to make transactions just like a debit card, money in a bank, except
but unlike a debit it is NOT connected to A. To help get a job
a bank account. Often comes with heavy
fees for basic services! Beware! B. To earn interest
A. Debit Card C. To keep it safe
B. Credit Card D. To make financial transactions easier
C. Store Gift Card 606. A transaction is
D. Prepaid Card A. any business done at the bank
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 746
B. when you take money out of an ac- A. Check Cashing Centers
count B. Payday Loan Centers
C. when you transfer money from one C. Rent-to-own Centers
person to another
D. Pawnshops
D. when you put money into an acount
612. Financial institution that provides ser-
607. Which of the following is not a way that vices for businesses.
banks keep your money safe? A. Investment bank
NARAYAN CHANGDER
A. identification B. Credit union
B. enforcement C. Securities firm
C. armor trucks D. Savings and loan institution
D. recordkeeping 613. Promotes the development of effective
608. The was created by the federal gov- and efficient development financial situa-
ernment to supervise and regulate mem- tions
ber banks so they serve the public effi- A. BAFIA 1989
ciently. B. Development Financial Institutions Act
A. Federal Reserve System (FED) 2002
B. FBI C. Islamic Financial Service Act 2011
C. FIDC D. Central Bank of Malaysia Act 2009
D. Credit Union 614. How can you be MOST certain that a
stock you own will allow you to vote at
609. This is a sequence consisting of NINE num- stockholder meetings and also earn divi-
bers used by banks to identify specific fi- dends?
nancial institutions within the US:
A. It must be both a common stock and
A. ABA Number (Check routing number) an income stock
B. Check number B. It must be both a common stock and a
C. Check account number growth stock.
D. Memo C. It must be both a preferred stock and
an income stock
610. a number allocated to an individual and D. It must be both a preferred stock and
used to validate electronic transactions. a growth stock.
You will have one for your debit card!
A. PEN 615. A bank is
A. a business that keep money for cus-
B. PIN
tomers and makes loans.
C. PUN
B. a company that uses your money for
D. PBS bartering.
611. A financial institution that charges large C. an organization that holds money and
fees to cash payroll and government other valuable assets.
checks to people who do not have a bank D. a business that borrows money from
account. you.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 747
616. The major difference in banks and credit 621. If float averaged $800 million per day
unions is last year, and the average this year is 5
percent less, what does float average per
PRACTICE BOOK» NOT FOR SALE
A. credit unions are member owned
day this year?
B. banks charge higher fees
A. 7.6 Million
C. credit unions pay higher interest rates
B. 760 Million
on loans
C. 240 Million
D. credit unions offer lower rate loans.
D. 76 Million
617. If you notice charges on your account that
you didn’t make, what should you do? 622. The date when the money becomes avail-
able is
A. Call your bank’s customer service im-
mediately and report the charges immedi- A. Actual date
ately. B. Maturity date
B. Don’t do anything til your bank state- C. Current date
ment comes D. None of the above
C. Call the FBI
623. was created to supervise and reg-
D. Wait until you can go to the bank in per- ulate member banks and to help banks
son and talk to someone. serve the public efficiently.
618. If a person wants to keep a personal A. Savings & Loan
record of their checking account, they need B. Federal Reserve System
to have a what:
C. Commercial Banking
A. Check Register
D. Army Reserves
B. Check Stub
624. Choose the best answer for information
C. Bank Statement
about savings accounts
D. Economic Record
A. Savings accounts limit the number
619. The Fed banks to ensure the sound- of withdrawals that can be made each
ness of the banking system. month.
A. regulates B. Savings accounts may require you to
maintain a minimum balance to avoid pay-
B. closes ing a fee.
C. opens C. Savings accounts are best used to
D. runs store money for longer-term goals.
D. All of the above
620. What is the most important skill to suc-
cessfully serve customers? 625. RBI Commenced its operations in
A. speaking A. 1934
B. calculating B. 1935
C. negotiating C. 1949
D. listening D. 1947
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 748
626. Which type of check endorsement would 631. This institution only provides savings and
consist of an individual’s signature only. mortgage loans
A. blank A. Banks
B. restrictive B. Payday Loan Company
C. special/full
C. Savings and Loans
D. none of above
D. Credit Unions
NARAYAN CHANGDER
627. Philip has made some real poor financial
choices that is now coming back to haunt 632. An institution owned by their depositors.
him, but at least he has his car and thank-
A. Mutual Savings Banks
fully it’s paid off. He needs some fast cash.
What will he most likely do? B. Mutual Savings and Loan Banks
A. Apply for a loan at his local bank. C. Credit Unions
B. Pawn his title to his car D. Community Banks
C. Apply for a small loan at his local
Credit Union 633. Which of the following is NOT one of the
D. Visit a payday lender types of banks?
A. central banks
628. is a money transfer scheduled on a pre-
determined date to pay a recurring bill. B. commercial banks
A. Automatic Bill Pay C. retail banks
B. Automatic Teller Machine D. credit unions
C. Automatic Overdraft
D. None of the above 634. What is a financial institution owned by
shareholders called?
629. Bank account that allows the account A. bank
owner to make deposits, write checks, and
withdraw money. B. credit union
A. Savings account C. money place
B. Treasury account D. depository
C. Mutual fund account
635. Things to consider when choosing a finan-
D. Checking account
cial institution include:
630. In the U.S. economy the money supply is A. location of bank
controlled by the:
B. online banking offered
A. U.S. Treasury
B. . Federal Reserve System C. services that are included
C. Senate Committee on Banking and Fi- D. offer the type of checking account you
nance need
D. . Congress E. free give aways for signing up
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 749
636. What advantages do financial intermedi- C. Used by people for everyday transac-
aries off an investor? tions
PRACTICE BOOK» NOT FOR SALE
A. They offer liquidity, low interst rates D. An account where customers can go
and risk-free investmnet overdrawn on the amount they hold in it
B. They off securities, interest-free loans 641. Who is the regulator of Indian Capital
and diversificiation Market?
C. They share risks, provide information A. RBI
and provide liquidity
B. SEBI
D. They share securities, provide liquidity
C. IRDA
and assume risk
D. NABARD
637. What is it called when another person
gives you money that you will need to pay 642. A check that has been cashed and pro-
back? cessed by the bank for payment is consid-
ered
A. Interest
A. cleared
B. Savings Plan
B. outstanding
C. Borrow
C. forged
D. Lend
D. stale
638. Insurance protects your bank de-
posits up to $250, 000 643. “If the bank is unable to collect a bill on
due date, immediate steps should be taken
A. SEC to recover the amount from the drawer”,
B. IRS this feature comes under of bank audit
C. FDIC A. Internal Control System of cash
D. WWF B. Audit report
C. Internal Control System of Bills
639. The amount an original deposit will be
worth in the future based on its earning as- D. Preparation of financial statements
pecific interest rate over a specific period
644. Which of the following would be the
of time is referred to as:
LEAST secure way to send payment to
A. future value another person or business through the
B. present value mail?
C. current value A. A personal check
D. time value B. A cashier’s check
C. A money order
640. A deposit account is best described as
D. Cash
A. A current account, savings account or
another type of bank account which allows 645. What are the benefits of using a debit
money to be deposited and withdrawn by card?
the account holder. A. It is like using your own cash and it’s
B. A safe place to store you savings convenient.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 750
B. There is no overdraft fee. 651. a check written for an amount greater
C. There is no interest fee. than the balance of the account
D. You can check and track down your A. overdraft
transactions. B. overspend
646. Amirah is going to college and will not C. fraud
be able to visit her home bank very often. D. none of above
She needs a way to access her money and
NARAYAN CHANGDER
track what she spends. 652. What type of bond would a city issue to
A. personal loan repair a bridge?
B. debit card A. municipal
C. online banking B. corporate
D. none of above C. junk
647. What is a deposit that does NOT appear D. treasury
on the bank statement called?
653. What is a Check Cashing Fee?
A. outstanding deposit
A. A monthly bill for writing checks
B. bad deposit
C. good deposit B. Money charged for using an ATM
D. cleared deposit C. An amount charged to individuals in or-
der to cash a check
648. Which of the following is NOT a way D. Money withdrawn for writing a check
banks decide on how creditworthy a cus-
tomer is? 654. What fee would you be charged by a bank
A. a job or credit union if you write a check and do
not have enough funds to cover it?
B. ongoing income source
C. sufficient collateral for loans A. Insufficient funds fee
D. good credit rating B. Stop payment fee
C. Check fee
649. Anything of value
D. Point-of-Sales fee
A. asset
B. equity 655. A Not for Profit depository institution
C. profit that is owned by members. Only members
can open accounts, you must meet certain
D. spread membership requirements to join. Gener-
650. Axis Bank is ally higher savings rates and lower fees
A. Private Bank A. Bank
B. Public sector bank B. Credit Union
C. Cooperative Bank C. Payday Lender
D. Development Bank D. Check Cashing Company
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 751
656. Non profit service cooperative that ac- 661. Which of the following is NOT true of a
cepts deposits, makes loans, and provides cashier’s check?
other financial services
PRACTICE BOOK» NOT FOR SALE
A. It is written to a specific payee.
A. Credit union B. It is drawn against the bank, not the
B. Corporation individual’s account.
C. Stock C. It is paid for when the recipient cashes
it.
D. none of above
D. It is often accepted when a personal
657. State bank of india started merchant check would not be.
banking in followed by icici in
662. Which is the following NOT the islamic
A. 1980, 1981 banking products?
B. 1978, 1980 A. Al ijarah
C. 1973, 1974 B. Al murabahah
D. none of above C. Bai’Bithaman Ajil
D. Ar-Rahnu
658. This month, costs for SafeCo Bank were
$750, 000; the bank collected $970, 000 663. OTCEI not Popular with investors be-
in revenue. Find the bank’s profit for the cause
month. A. Lack of floating stock
A. Not enough information to calculate B. No arbitrage opportunity
B. $970, 000 C. No opportunity for jobbing
C. $1, 720, 000 D. Network issues
D. $220, 000 E. All the above
659. All money in financial institutions in- 664. Gives the bank the power to license
sured by FDIC is insured for up to which and regulate money changing business in
amount? Malaysia
A. 100, 000 A. Central Bank of Malaysia Act 2009
B. 10, 000 B. Financial Service Act 2013
C. Money Service Business Act 2011
C. 250, 000
D. Development Financial Institutions Act
D. 25, 000
2002
660. Fee for writing a check for “bouncing a 665. Which is NOT a way to deposit money
check” (writing it for more money than is into your bank account
in your account)
A. At your bank branch / through bank
A. Nonsufficient Funds Fee ATM
B. Withdraw Fee B. Direct Deposit From Employer
C. Service Fee C. Mobile App Deposit
D. ATM Fee D. Telepathy
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 752
666. An investment bank helps issue secu- 671. What is the amount of money required to
rities be stay in an account?
A. A Corporation A. Maximum Balance
B. Government B. Minimum Balance
C. Foreign governments C. Minimum Deposit
D. none of above D. Maximum Deposit
672. What is it called to make the bank state-
NARAYAN CHANGDER
667. The national savings certificate are is-
ment and the check register agree?
sued by
A. contract
A. State of of India
B. review
B. Reserve Bank of India
C. reconcile
C. Postal bank of india
D. check
D. None of the above
673. Which of the following is a nondepository
668. Every time Angela receives her paycheck, intermediary?
it comes with a list of information attached A. commercial bank
about where her money came from and
other things such as tax deductions. The B. insurance company
part of the check containing this informa- C. savings and loan association
tion is a: D. credit union
A. Check Stub
674. Who created the first Central Bank in the
B. Check Number US?
C. Check Register A. President Washington
D. Certified Check B. Thomas Jefferson
C. Andrew Jackson
669. Written order for the bank to pay a spe-
cific amount to the person or organization D. Alexander Hamilton
to which the check is written.
675. What is the goals of FSA?
A. Deposit
A. Maintain financial stability
B. Finance company B. Provide adequate consumer protec-
C. Investment bank tion
D. Check C. Enhance growth in financial sector
D. All of above
670. What do you fill out when you want to
put money in the bank? 676. You can request the bank to automatically
transfer money from to checking to
A. check
cover a check that has insufficient funds
B. deposit slip (but it will cost you)
C. ticket A. savings
D. form B. overdraft
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 753
C. loan 682. Savings account, checking accounts, and
D. credit certificates of deposit are examples of
PRACTICE BOOK» NOT FOR SALE
A. Savings Services
677. Why do you think ratings are helpful to
B. Payment Services
investors?
C. Loan Options
A. They lower potential risk
D. Investment Advice
B. They raise potential risk
C. They improve the yield for investors 683. On whose suggestion RBI was set up?
D. They help investors judge potential A. Government of India
risk B. Hilton Young Commission
C. East India Company
678. Which of the following is NOT a source of
income for a bank? D. Charles John Canning
A. the interest earned by depositors 684. The main purpose of a consumer finance
B. loan income company is to
C. investments A. provide home mortgages
D. fees for services B. offer interest-earning checking ac-
counts
679. There are Regional Federal Reserve C. make loans for durable goods
Banks, and one Federal Reserve Board of
D. offer different types of savings plans
Governors.
A. 50 685. when your employer automatically de-
posits your paycheck into your bank ac-
B. 4
count
C. 12 A. DEPOSIT
D. 52 B. PAYROLL CHECK
680. How do financial institutions make most C. ATM
of their money? D. DIRECT DEPOSIT
A. Fees
686. When you enter your PIN at an ATM you
B. Interest should always
C. Mutual Funds A. shield your screen
D. Loan Payments B. say it out loud
C. write it down on the deposit slip
681. Number the bank gives you to keep track
of your money D. count your money at the machine to
make sure it is accurate
A. bank
B. banking account 687. A check from a personal checking account
that has been stamped by the bank to
C. balance guarantee that there are sufficient funds
D. application in the account to cover it
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 754
A. Certified checks C. paper goods
B. Cashier’s checks D. checking accounts, savings accounts,
C. Money orders loans and investments
D. Traveler’s checks 693. When filling out her checkbook, Sarah
writes down numbers for each individual
688. The United States is divided into Fed- check to be able to identify that particu-
eral Reserve districts, with a central Fed- lar check if she needs to. The numbers she
eral Reserve bank in each district. writes down make up the:
NARAYAN CHANGDER
A. 4 A. ATM Card Number
B. 12 B. ABA Number
C. 24 C. Checking Account Number
D. 50 D. Check Number
689. companies that make loans based on an 694. What is a central bank normally con-
individual’s Collateral; an item of value nected to and what does it do?
one owns like a car.Lenders can sell the A. none
collateral to cover the value of an out-
standing loan if the borrower cannot re- B. It is normally part of or connected to
pay. Charge high interest. the government of a country and manages
the country’s financial system
A. title / pawn lenders
C. It runs the government
B. pay day lender
D. It is usually connected to money and
C. credit union sends it all over the world
D. mortgage broker
695. Up-selling or cross-selling involves bank
690. Current deposit is also known as contact centers reaching out to customer-
swith all of the following strategies ex-
A. Savings deposit cept:
B. Demand deposit A. product configurations
C. Time deposit. B. product-centric approach
D. Recurring deposit C. product bundles
691. Card that you use to pay for items and D. prices designed specifically to meet
the money comes out of your checking ac- the needs of customers
count.
696. Which one of the following is not an ex-
A. endorse ample of an agency that is focused on
B. overdrawn makingbanking safe and mutually benefi-
cial across international borders?
C. debit card
A. Bank for International Settlement
D. statement
B. Asia Pacific Economic Cooperation
692. Banks sell services such as C. President’s Working Group on Finan-
A. personal credit cial Markets
B. housewares D. International Monetary Fund
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 755
697. Which of the following is a tax that is C. FDIC
taken on the money you earn from the job D. FDDC
you preform?
PRACTICE BOOK» NOT FOR SALE
A. Sales tax 703. Has a built in microprocessor instead of a
magnetic security strip
B. Social Security Tax
C. Income Tax A. saving accounts
D. Estate Tax B. Smart cards
C. Funds
698. Anything of value that can be readily ex-
changed D. none of above
A. asset 704. Which of the below statements is false?
B. liquid asset
A. Loan should be granted only after ver-
C. equity ifying the creditworthiness of borrower
D. liability B. All Securities should be kept in safe
custody
699. Identify all depository institutions bel-
low: C. Surprise checks should be made
A. A commercial bank D. All employees of the banks can have ac-
B. An investment company cess to books of accounts of the banks
C. A credit union 705. Bank Negara Malaysia was established
D. An insurance company on
A. 26 January 1959
700. Banks make loans because they make
most of their income from the they B. 25 January 1959
charge borrowers. C. 24 January 1959
A. services
D. 23 January 1959
B. fees
706. To sign the back of the check
C. interest
D. classes A. endorse
B. overdrawn
701. Which of the following questions is NOT
available with online banking? C. debit card
A. Transfer cash between accounts D. statement
B. Cash withdrawal 707. Computer terminal that allows the with-
C. Order bank statements drawal of cash and perform other banking
D. Set up direct debits transcactions.
A. FDIC
702. What federal organization insures
banks? B. ATM
A. FDCI C. ATF
B. FDOC D. IRS
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 756
708. Credit Unioncharacteristics: 713. What will the bank request from you?
A. are for people, not for profit, fawer A. An ID
fees, better rates
B. A cellphone bill
B. arefor profit, more fees, worse rates
C. A gas bill
C. are not for profit, more fees, worse
D. A selfie to have on file
rates
D. none of above 714. Which savings account will earn you the
NARAYAN CHANGDER
most money?
709. What is the full form of DICGC?
A. One that compounds interest monthly.
A. Derivative Investment and Commer-
B. One that compounds interest daily.
cial Governance Committee
C. One that earns simple interest daily.
B. Depository Investment and Commod-
ity Governance Committee D. One that earns simple interest
monthly.
C. Deposit Insurance and Credit Grantee
Corporation 715. Money helps us measure economic trans-
D. None actions as a common measure of value.
A. medium of exchange
710. The paper money used in the United
States is: B. store of value
A. National Bank Notes C. unit of account
B. Treasury Notes D. measure of value
C. United States Notes 716. Which of the following statements about
D. Federal Reserve Notes banks is NOT true?
A. Banks are essential to maintaining the
711. A check-cashing outlet is commonly used
economy.
by
B. All banks are organized as corpora-
A. people who have life insurance
tions.
B. people who do not have a bank account
C. BAnks distribute the medium of ex-
C. investors who desire a high rate of re- change.
turn
D. Banks may be chartered by either fed-
D. consumers who want to buy homes eral or state governments.
712. When writing a check, include all of the 717. Liquidity is
following except
A. the ability to access cash quickly
A. the current date
B. the ability to pay online
B. the name of the payee
C. the ability to have your money in the
C. your signature on the front bank insured
D. an endorsement on the back D. the ability to access your bank records
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 757
718. Bank account used to store money for 723. People buy to provide financial stabil-
longer term goals. Fees vary but are of- ity for their dependents.
ten waived if you maintain a minimum
PRACTICE BOOK» NOT FOR SALE
A. Homes
balance or make a minimum monthly de-
posit. You may only make 6 withdrawals B. Car Loans
per month! Interest can be earned daily, C. Life Insurance
weekly, monthly, or annually D. Deposits
A. Checking Account
724. The act of giving money, property or
B. Savings Account other material goods to a another party in
C. Piggy Bank exchange for future repayment of the prin-
D. Credit Union cipal amount along with interest or other
finance charges.
719. If you lose your ATM card you should A. interest
A. report the loss to the issuing bank B. credit card
B. cancel the last purchase made with the C. loan
card
D. bank
C. notify the FDIC within 24 hours
D. move your accounts to another finan- 725. Putting money into an account is known
cial institution as
A. Sinking
720. Cancellation of crossing of a cheque is
called B. Placing
A. Mutilated cheque C. Withdrawing
B. Torned cheque D. Depositing
C. Material alterations 726. You receive 4 checks for birthday gifts
D. None of these and you want to deposit them in your ac-
count you should
721. As a function of money, means that A. only sign them on the back when you
money is a common measure of the worth get to the bank or use a restrictive en-
or price of a good or service. dorsement
A. banknote B. sign them on the back immediently
B. store of value C. put them in an envelope and deposit
C. monetary system them without signing to prevent fraud
D. unit of value D. mail them to the bank with a deposit
slip
722. What do we call the extra money paid
back on a loan? 727. This is a check guaranteed by a bank:
A. deposits A. Certified Check
B. interest B. Cashiers Check
C. public goods C. ATM Check
D. taxes D. Certificate of Deposit
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 758
728. Money received is called 733. All of the following can happen if you
A. income bounce a check (write an overdraft) EX-
CEPT
B. insurance
A. the unpaid check will be returned to
C. savings the payee’s bank
D. none of above B. you will be charged substantial fee by
your bank
729. A share of common stock is a claim on a
C. the payee, if a business, will charge
NARAYAN CHANGDER
corporation’s
you a fee for a bounced check
A. debt.
D. you will be arrested for check fraud
B. liabilities.
734. Which of the following typically has the
C. expenses.
lowest fees or costs to use?
D. earnings and assets. A. Debit Card
730. Financial institution that makes money by B. Credit Card
issuing loans. C. Cash Advance
A. Finance company D. Payday Loan
B. Investment bank 735. Use the RULE OF 72 to calculate how long
C. Nondepository institution it will take for your money to double if it’s
D. Securities firm earning 6% in interest.
A. 12 years
731. Caiden earned $475 from mowing lawns
B. 16 years
last summer. He deposited this money in
an account that pays an interest rate of C. 36 years
3.8% compounded annually . What will D. 72 years
be his balance after 15 year?
736. Savings and Investment accounts offered
A. $827.52 by Islamic banks such as the case of BISB
B. $831.10 and KFH utilize the contracts below, ex-
cept:
C. $839.45
A. Mudharabah Muqayyadah
D. $846.80
B. Ijarah
732. Which of the following will most benefit C. Mudharabah Mutlaqah
you financially?
D. Wakalah
A. A savings account that compound inter-
est daily 737. Which account is commonly opened by
people to save their money for future
B. A savings account that compound in-
needs?
terest monthly
A. Savings bank account
C. A savings account that compound in-
terest yearly B. Current account
D. A savings account that does not com- C. Recurring deposit account
pound interest D. Term or fixed deposit account
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 759
738. Which of the following would you need C. Using your debit card to pay for gro-
to do to make sure that $750, 000 worth ceries at the supermarket
of your deposits were insured and backed
PRACTICE BOOK» NOT FOR SALE
D. Depositing a check at a local bank
by the federal government?
branch
A. Apply for both FDIC and NCUSIF insur-
ance 743. is the ability to transfer money to oth-
B. Keep your deposits in a bank’s safety ers.
deposit box
A. Savings Services
C. Place $250, 000 in accounts in three
different financial institutions B. Payment Services
D. Maintain a reconciled bank statement C. Loan Options
739. Amount of money in your account at a D. Investment Advice
given time.
A. bank 744. High-interest rates might cause a corpo-
ration to building a new plant that
B. bank account would provide more jobs.
C. balance
A. complete
D. application
B. consider
740. There should be effective screening done
C. postpone
at the time of of credit cards
A. Cancellation D. contemplate
B. Issue
745. Formula used to compute the amount of a
C. Payment depository institutions required reserves
D. Renewal A. Fee
741. Which service(s) was(were) core activi- B. State-chartered bank
ties of financial institutions like ICICI, IDBI
and IIBI? (multi choice) C. Reserve requirement
A. Term loan D. none of above
B. Assistance for project finance
746. was established as a premiere
C. Working capital loan
economic-based Islamic financial institu-
D. Short duration non-project asset- tion inspired with a realization to help
backed financing provide investment services and opportu-
nities while managing pilgrimage activities
742. Which of the following transactions will
for the Malaysian Muslim community.
REDUCE your checking account balance im-
mediately A. EPF
A. Writing your monthly rent check which B. SOCSO
you will mail tomorrow
C. KWSP
B. Using your credit card to pay for your
school books D. Tabung Haji
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 760
747. Financial markets promote economic effi- 752. How many Board of Governor members
ciency by are there?
A. channeling funds from investors to A. 3
savers. B. 5
B. creating inflation. C. 7
C. channeling funds from savers to in- D. 12
vestors.
NARAYAN CHANGDER
D. reducing investment. 753. You should keep track of your spending
because if you spend more money than you
748. What should you do before you use an have in your bank account it is considered
ATM? a and usually will cause a fee.
A. Ask someone nearby for help using the A. Balance
ATM.
B. Withdraw
B. Share your pin number with trusted
C. Bankruptcy
friends so you don’t forget it.
D. Overdraw
C. Inspect the ATM and its surroundings
to make sure it is safe to use. 754. Riba which is related to the exchange of
D. Memorize your debit card number be- certain type of goods/commodities that in-
cause you’ll need to type it in at the ATM. volve different counter value and or de-
ferred delivery is:
749. What is it called when you spend more
A. Riba Al Fadl
money than is in your account, often re-
sulting in a fee? B. Riba Al Nasi’ah
A. Credit C. Riba Al Jahiliyyah
B. Debit D. Riba Al Duyun
C. Transfer 755. What is the purpose of money market?
D. Overdraft A. Serve as link between surplus and
750. Making payments on time is an important deficit units.
part of managing which of the following? B. Raise money for projects by issuing
A. Checking account stock
B. Savings account C. Able to rapidly adjust liquidity position.
C. Trust account D. Bring together investors holding capi-
tal
D. Loan account
756. Outstanding transactions are
751. A market for dealing in monetary assets
of short term nature, less than year. A. ones that were received by the bank af-
ter the closing date of your statement
A. One
B. ones that were done perfectly and do
B. Two not require your attention
C. Five C. ones that match your own record of
D. none of above transactions
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 761
D. ones that are on the bank statement 762. Extended Bank Negara Malaysia’s pow-
but not on your own record ers for the supervision and regulation of
financial institutions
PRACTICE BOOK» NOT FOR SALE
757. When the national bank was estab-
lished? A. IFSA 2013
A. 23 January 1959 B. DFI 2002
B. 25 January 1956 C. BAFIA 1989
D. MSBA 2011
C. 26 January 1959
D. 21 January 1957 763. The widest range of financial services is
offered by
758. Which deposit institution specialize in
A. a mutual savings bank
savings accounts and making loans for
home mortgages? B. an investment company
A. Credit Unions C. a check-cashing outlet
B. Mutual Savings Banks D. a commercial bank
C. Savings and Loan Association 764. Which of the following financial institu-
D. Commercial Bank tions provides loans for prospective home
buyers?
759. The person to whom a check is written is
A. Mortgage companies
the
B. Brokerage firms
A. drawer
C. Insurance companies
B. payee
D. Savings and loan associations
C. endorser
D. drawee 765. What do commercial banks provide ser-
vice to?
760. Which of the following is the most signifi-
A. None
cant difference between commercial banks
and credit unions? B. A commercial bank provides banking
services
A. How they pay interest on deposits
C. A commercial bank provides to busi-
B. How they charge interest on loans
nesses
C. How they are regulated by the govern-
D. A commercial bank provides banking
ment
services to businesses, institutions and
D. What types of deposits they accept some individuals.
761. The phrase used for putting money into a 766. What is money borrowed that must be
savings account is: repaid, usually with interest?
A. Verifying the account A. Loan
B. Balancing the account B. Check
C. Making a deposit C. Checking account
D. Making a withdrawal D. Debit card
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 762
767. A cash obligation C. Investment bank
A. asset D. Line of credit
B. liquid asset
773. money subtracted from an account
C. equity
A. withdrawal
D. liability
B. deposit
768. Interest earned on interest is called
C. transfer
NARAYAN CHANGDER
A. compound interest
D. balance
B. double interest
C. interest on fire 774. The standard insurance amount provided
D. complicated interest by the FDIC is per depositor, per in-
sured bank, for each account ownership
769. What is the full form of LIBOR? category.
A. Local Indian Bank Offered Rate A. $100, 000
B. London-India Bureau Of Regulations B. $250, 000
C. Liberal International Bank Official Ra- C. $500, 000
tio
D. $1, 000, 000
D. London Inter Bank Offered Rate
770. Four types of Depository Institutions are 775. What is the name of our nation’s central
Commercial Bank, Mutual Savings Bank, bank?
Credit Unions and A. The Federal Reserve
A. Pawn Shops B. The United States National Bank
B. Federal Reserve C. The National Bank of the United States
C. Savings and Loan Association D. Bank of America
D. Life Insurance Agencies
776. In a point-of transaction, a merchant
771. What relationship does risk have to re- accepts a debit card to pay for purchases.
turn?
A. Service
A. with lower risk, the potential for a re-
turn disappears B. Stop
B. the higher the risk, the lower the po- C. Sale
tential for return D. Reserve
C. the lower the risk, the greater the po-
tential for return 777. covers the entire range of services
provided by a merchant banker.
D. the higher the risk, the greater the po-
tential for return A. Cooperate counselling
772. Money placed into an account. B. Project counselling
A. Deposit C. Credit syndication
B. Finance company D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 763
778. Why is it important to reconcile your 783. The main purpose of the Federal Reserve
bank statements? System is to
PRACTICE BOOK» NOT FOR SALE
A. To avoid spending more than what is in A. collect tax revenue for state and local
your account. governements
B. To detect any errors in your account. B. supervise and regulate member banks
C. To determine if you were charged any C. protect depositors’ money in case of
fees. bank failure
D. All of the above D. inform consumers of wise investments
choices
779. refers to the use of a smartphone or
other cellular device to perform online 784. These institutions do not receive deposits
banking tasks while away from your home but provide other financial services for a
computer, such as monitoring account bal- fee.
ances, transferring funds between ac-
A. non depository institutions
counts, bill payment and locating an ATM
B. depository institutions
A. Mobile Banking
C. credit unions
B. Brick and Mortar Banking
C. Traditional Banking D. clearing houses
D. Wire Fraud 785. The bond markets are important because
they are
780. What institution clears checks for mem-
ber banks? A. easily the most widely followed finan-
cial markets in the United States.
A. Federal Reserve
B. the markets where foreign exchange
B. White House rates are determined.
C. US Banks C. the markets where interest rates are
D. Credit Unions determined.
781. Which financial institution offer loans D. the markets where all borrowers get
such as mortgages and auto loans? their funds.
A. commercial banks 786. You can deduct money from your bank ac-
B. credit unions count to make a purchase by use of a
C. savings and loans A. Debit card
D. all of them B. Credit card
C. Charge card
782. When you don’t have enough money in
your checking account to pay for a check, D. Prepaid card
the check will:
787. A that pools money from many in-
A. Drop vestors and invests in well diversified
B. Bounce portfolio of sound investment.
C. Rip A. mutual fund
D. Fail B. Venture capital
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.10 Banking and Financial Institutions 764
C. Commercial Banks 793. Which of the following statements about
D. Insurance companies savings accounts is FALSE?
A. Savings accounts pay interest on the
788. The market value of all share or equity money you deposit.
issued by a company is called it’s B. Savings accounts allow an unlimited
A. Money for Investment amount of withdrawals each month.
B. Return on Capital C. Savings accounts may require you to
maintain a minimum balance to avoid pay-
NARAYAN CHANGDER
C. Total Equity
ing a fee.
D. Market Capitalisation D. Savings accounts are best used to
store money for longer-term goals.
789. Which is NOT a factor to consider when
shopping for a bank? 794. The term bank derived from Italian word
A. Minimum balances requirements A. Bank
B. Interest Rates and Fees B. Banco
C. Celebrity Endorsement C. Banque
D. ATM availability D. Banko
795. Which of the following statements about
790. An overdraft is
M1 Assests is true?
A. a check that has not been cashed yet
A. M1 assets cannot be converted easily
B. a check that has an error on it and has into cash
been voided B. M1 assets are stored in savings ac-
C. a check that is written over the amount counts.
available in the account C. M1 assets can be converted into cash
D. a check that is written for more than easily.
the amount owed D. M1 assets do not have liquidity.
791. The fed manages the amount of in the 796. The Federal Reserve uses to regulate
economy to try to keep inflation low and the nation’s money supply?
stable. A. monetary policy
A. money B. fiscal policy
B. people C. proposed legislation
C. companies D. regulations
D. credit cards 797. interest earned only on the principal,
which is the amount of money originally
792. The laws applicable to banks is deposited
A. Sale of goods Act, 1930 A. simple interest
B. Consumer Protection Act, 2019 B. compound interest
C. Indian Contract Act, 1872 C. accumulation
D. Companies Act 2013 D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 765
798. What is online banking? B. Banking through online services.
A. Banking services that requires your C. Banking through Google Chrome.
PRACTICE BOOK» NOT FOR SALE
signature. D. none of above
1.11 Marketing Management
1. Which of the following is an example 5. What type of segmentation occurs when
of helpful, printed information that busi- McDonald’s creates a new value meal
nesses often give new employees during product that is for children ages 6-9 offer-
orientation: ing a double cheeseburger, small fries and
A. Promotional brochure a small soda?
B. Annual report A. Demographics
C. Application form B. Psychographics
D. Company handbook C. Geographics
D. Product Benefit
2. Rank the receiving process components in
order below:a. Goods are marked and 6. Which of the following types of economic
priced to be sent out into the store b. systems would offer the most benefits to
Boxes are recorded on a receiving record business owners and to their employees:
c. Merchandise is checked d. Truck arrives
at store e. Any damages are reported f. A. Market
Order is placed B. Socialist
A. F, D, A, B, C, E C. Communist
B. F, D, B, C, E, A D. Traditional
C. A, B, C, D, E, F
7. In a orientation, the role of marketing
D. B, C, D, E, F, A research is to determine customer needs
and how well the company is satisfying
3. Trey hangs posters advertising the school
them.
play in local businesses. What marketing
function did he implement? A. Marketing
A. promotion B. Production
B. selling C. Production
C. distribution D. Selling
D. financing
8. is often used as a regulator of the de-
4. This enables customers to try a product mand of a product & considered to be an
risk-free. effective competitive weapon.
A. Contest A. Promotion
B. Sampling B. Branding
C. Premium C. Pricing
D. Frequent buyer program D. Distribution
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 766
9. Mona purchased a packet of chips from the services and identify, evaluate and choose
local grocery shop. The information pro- among alternative brands and suppliers.”
vided on the bottle was not clear. She fell A. Business buying
sick on consuming it. She filed a case in
the district forum and got the relief. Iden- B. Organizational buying
tify the important aspect neglected by the C. Formal buying
marketer in the above case. D. None of the above
A. Packaging
14. Three purposes of qualitative data
NARAYAN CHANGDER
B. Labelling
A. to identify trends and patterns in peo-
C. Branding ple’s statements
D. Pricing B. to support qualitative data
10. “Availability and Affordability” of the C. to quantify the data in charts and
product are considered to be the key to the graphs
success of a firm. It is main object of which D. to gather in-depth information from
marketing philosophy? consumers
A. Production concept
15. Aarti works as an Interviewer and is not
B. Product concept overqualified for her job. What level of
C. Selling concept education does Aarti most likely have?
D. Marketing concept A. some high school
B. a master’s degree
11. refers to all of the different ways that
the company will communicate about the C. a bachelor’s degree
product or service. a. Promotion b. Price D. a high school diploma
c. Product d. Place
16. A marketing-information management
A. A system can help business to
B. B A. motivate employees
C. C B. discover employee potential
D. D C. practice good business ethics
12. Which of the following is an example of a D. discover new markets
marketing strategy that a business might
17. An example of personal selling is
develop in order to achieve an objective it
has outlined in its marketing plan: A. Trade shows
A. Obtaining $1 million in sales B. Billboards
B. Lowering prices by 5% C. Contests
C. Increasing profits by 10% D. Magazines
D. Reducing operating costs 18. Which of the following is not the objective
of advertisement?
13. What is it called? “ The decision making
process by which formal org. establish A. Creation of Demand
the need for the purchased products and B. Quality of Product
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 767
C. Increase goodwill of business A. Selling
D. Increase sells B. Marketing
PRACTICE BOOK» NOT FOR SALE
19. Which of the following is an important re- C. Branding
quirement for all public relations special- D. Promotion
ists?
24. At the end of her one-week stay at a lux-
A. Getting an internship ury hotel, Elena completed a form rating
B. Obtaining a bachelor’s degree the hotel’s service, food, and accommoda-
tions. What is this an example of?
C. Knowing basic mathematics
A. information utility
D. Understanding the global market
B. promotion
20. Terms-of-sale selling policies cover such
C. product planning
conditions of the sale as
D. marketing research
A. credit, delivery, and discounts
B. installation and maintenance 25. Devon is very good with people. She
works for a pharmaceutical company and
C. discounts, guarantees, and returns often visits doctors to see if they will sell
D. entertaining the customer and her product to their patients. In which
prospecting career pathway is Devon most likely in-
volved?
21. As prices for a product increase,
A. Marketing Communications
A. Supply Increases & Demand De-
creases B. Professional Sales and Marketing
C. Distribution and Logistics
B. Supply Increases & Demand In-
creases D. E-Marketing
C. Supply Decreases & Demand In- 26. Establishing a time frame in which to
creases achieve a goal, assigning employees to the
D. Supply Decreases & Demand De- project, and determining a method for ap-
creases proaching the work.
A. exit interview
22. Marketing is the activity, set of &
processes for creating, communicating, de- B. preventive discipline
livering & exchanging offerings that have C. remedial action
value for customers, clients, partners & so-
D. organizing
ciety
A. Institutions 27. In this stage of the product life cycle, ad-
vertising is focused on attracting the mass
B. Top Management
markets and marketers focus on building
C. Business heavy distribution outlets to meet con-
D. Market research sumer demand.
A. Growth
23. It is a process whereby people exchange
goods and services for money or for some- B. Introduction
thing of value to them. C. Product Development
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 768
D. Maturity 32. Needs are
E. Decline A. requirements for something neces-
sary in a person’s life
28. In planning marketing activities and in
making marketing decisions, marketers B. people’s needs that are moulded by
use a variety of data gathered by a(n) culture and individual personality.
A. Marketing information management C. are created when the buying power
system backs a person’s want.
NARAYAN CHANGDER
B. double-entry bookkeeping system D. need-satisfying offerings of a firm to
the market for attention, acquisition, use,
C. file of employee records or consumption
D. inventory control system
33. Businesses plan for and interact differ-
29. Monika purchased a packet of chips from ently with their larger clients than with
the local grocery shop. The information their smaller ones. They assign more
provided on the bottle was not clear. She client service personnel and extend more
fell sick on consuming it. She filed a case relationship management efforts because
in the district forum and got the relief.i) these customers tend to be
Identify the important aspect neglected by A. more profitable.
the marketer in the above case.
B. cheaper.
A. Labeling
C. less profitable.
B. Branding
D. higher quality.
C. Packaging
D. Communicating 34. Which marketing career field involves
catching customers’ attention, informing
30. In this stage of the product life cycle, sales them of products, and persuading them
are low and competition is low. Cus- buy?
tomers who seek innovative products are A. Marketing research
attracted to the company.
B. Advertising
A. Growth
C. Public relations
B. Introduction
D. Product managmeent
C. Product Development
D. Maturity 35. What type of duties do customer-service
professionals often perform?
E. Decline
A. Preparing ads
31. Andy is asking questions via email to a B. Paying invoices
young group of people to collect informa-
tion about a new product. What method is C. Handling complaints
Andy using? D. Receiving shipments
A. Target marketing 36. The price at which both buyers and sellers
B. Media research agree is known as
C. Survey A. Scarcity
D. Focus group B. Opportunity Cost
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 769
C. Market Clearing Price or Equilibrium C. Promotions
D. Derived Demand D. none of above
PRACTICE BOOK» NOT FOR SALE
37. Professionals in the Pathway formu- 42. Which one is not a benefit of MIS?
late policies and direct the operations of A. It provides market intelligence to the
businesses and corporations, nonprofit in- firm
stitutions and other organizations. a.
Marketing Communications b. Merchandis- B. It helps the controlling of marketing
ing c. Marketing Management d. Profes- activities
sional Sales C. The information, if free from any error,
A. A will not have more value than otherwise
B. B D. It facilitates the development of action
programmes for achieving set goals
C. C
D. D 43. Deepak is a book seller. One day he was
selling books. He approached a person
38. “Body Shop Company” is an example of? who was sitting on a pavement. He of-
A. Production concept fered him the book and found that he was
not having enough money to pay. So he
B. Marketing concept
willingly gave him the book without taking
C. Societal concept money. Is it a true exchange mechanism?
D. Environmental concept A. YES
39. Loyalty segmentation forms part of: B. NO
A. Demographic segmentation C. FIFTY FIFTY
B. Behavioural segmentation D. LITTLE BIT
C. Psychographic segmentation 44. Which characteristic of useful marketing
D. Geographic segmentation information is represented by the state-
ment:“The benefits of using the informa-
40. Select the explanation for merchandising- tion should be greater than the expenses
related discounts, Discounts given on end of gathering the data used to generate this
of the season products as an incentive to information?
clear out inventory and make room for the
A. timeliness
new inventory
B. accessibility
A. Cash discounts
C. cost-effectiveness
B. Quantity discounts
D. relevancy
C. Trade discounts
D. Seasonal discounts 45. which of these does the business lose
money
41. Works hand-in-hand with advertising to
bring additional purchase incentives to the A. introduction
customers. B. growth
A. Marketing C. decline
B. Advertising D. maturity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 770
46. It refer to the “extra’s such as free deliv- B. 13 items
ery, warranty, installation and the like. C. 14 items
A. Core Benefit
D. 15 items
B. Expected Product
52. USP is defined as
C. Augmented Product
D. Potential Product A. Unique Selling Price
B. Unique Sales Preposition
47. Which stage has the highest sales
NARAYAN CHANGDER
C. Unique Selling Preposition
A. Growth
D. Unique Strategic Preposition
B. Introduction
C. Maturity 53. As a small business owner, your productiv-
D. Decline ity goal would be for productivity to:
A. Increase
48. Which of the following is not included in
the elements of physical distribution? B. Decrease
A. Inventory C. Stay the Same
B. Costing D. none of above
C. Transportation 54. The act of trading a desired product or ser-
D. Warehousing vice to receive something of value in return
is known as which key concept in market-
49. Identify the factor based on the given ex- ing?
planation.As these increase, so will the
price and vice versa A. Product
A. Cost & Expenses B. Exchange
B. Supply & Demand C. Production
C. Consumer Perception D. Customer
D. Competition 55. ‘Buy three get one free’ is an example of
E. Government
A. Quantity gift
50. Young adults are most likely to be inter- B. Discount
ested in which of the following?
C. Rebate
A. music technologies
D. Product combinations
B. diapers
C. health care options 56. Which economic utility increased when
fast-food restaurants began accepting
D. travel
credit cards?
51. If the Point-of-Sale system shows ending A. form utility
inventory as 890 items and the physical
B. place utility
inventory shows 876. What is the shrink-
age at that point in time? C. possession utility
A. 12 items D. information utility
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 771
57. The name, symbol, slogan message or de- 62. Which career is best described by someone
sign used to identify a products reputation who organizes and tracks merchandise dur-
and image is the definition of ing storage and display?
PRACTICE BOOK» NOT FOR SALE
A. Brand A. Wholesale Buyer
B. Demand B. Marking Clerk
C. Supply C. Purchasing Agent
D. Product Life Cycle D. Stock Clerk
58. One advantage of information generated 63. is the central point in the marketing
by a marketing-information management point of view.
system is that the information
A. Customer’s satisfaction
A. does not need to be stored
B. Customer’s welfare
B. is presented in an organized fashion
C. Quality of the product
C. provides a narrow perspective of the
market D. Quantity of Product
D. will probably be used only once 64. are useful in providing detailed infor-
mation about the product, its contents,
59. What type of display is used when a store
method of use etc.
shows bathing suits, flip flops, and sun-
glasses together? A. Brands
A. One-Item Display B. Packages
B. Line-of-Goods Display C. Labels
C. Related Merchandise Display D. Design
D. Assortment Display 65. A type of management style in which top
60. Firms that provide the resources needed management shares decision making with
by the company to produce goods or offer self-managing teams of workers who set
services are their own goals and make their own deci-
sions.
A. the company
A. horizontal organization
B. the suppliers
B. supervisory-level management
C. the competitors
C. vertical organization
D. none of above
D. middle management
61. is the science of using psychology and
demographics to better understand con- 66. A brand or part of a brand that is given
sumers. legal protection is called-R
A. Psychographics A. Brand Name
B. Psychologists B. Trade Mark
C. Psychopathics C. Brand Mark
D. All the above D. Logo
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 772
67. is a plan for determining which products a C. Reading the text aloud
business will manufacture or stock. D. Correcting punctuation errors
A. 4 p’s
72. Which type of display is used to promote
B. product mix strategy the sale of one product by displaying that
C. promotional mix product by itself?
D. marketing A. One-Item Display
B. Line-of-Goods Display
NARAYAN CHANGDER
68. Which of the following is NOT a career
in the Marketing Communications path- C. Related Merchandise Display
way? D. Assortment Display
A. Database administrators
73. What is the term that is used to describe
B. Sales representatives the amount of sales that Coca-Cola has in
C. Public relations managers the soft drink market that is a direct goal
of pricing?
D. Advertising executives
A. Market share
69. The use of promotional techniques such as
B. Return on investment
advertising, personal selling and sales pro-
motion are considered essential under C. Competition
concept of marketing management D. Cost-Benefit Analysis
A. selling
74. For an NFL team, what is their core ser-
B. Production vice?
C. marketing A. a way for people to spend time with
D. none of above their family
B. the TV coverage of the games
70. Decisions surrounding the transportation
and storage of goods from producer to con- C. the experience
sumer. D. the ball game
A. Distribution
75. Serene, a college student, tends to buy the
B. Marketing Information Systems/Market same brands of toothpaste, shampoo, and
Research deodorant, which is often the strongest
C. Product/Service Management source of group influence upon the individ-
ual for many product purchases?
D. Selling
A. psychographic group
71. After Lana finishes writing the promo- B. social class
tional copy for a direct-mail letter, she
plans to proofread and edit her work on C. subculture
her computer. What technique should Lana D. family
use to determine if the text is clear and
logical? 76. Best buy has become the nation’s largest
speciality retailer by focusing on the cus-
A. Correcting grammatical mistakes tomers need and wants. This philosophy
B. Reading the text backwards is at the heart of an orientation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 773
A. sales C. Information
B. marketing D. Form
PRACTICE BOOK» NOT FOR SALE
C. retail 82. Company ABC is interested in better un-
D. production derstanding how different groups of cus-
tomers feel about its product. In order to
E. exchange
do this, Company ABC will need to
77. When looking at possible career choices A. position its product in the market.
you should consider all of the following,
B. segment the market.
except
C. mass market.
A. skills and interests
D. target market.
B. desired lifestyle
C. the highest paying careers 83. refers to classifying the product into
different groups with same characteris-
D. personality traits tics.
78. What types of skills are extremely impor- A. grading
tant for an applicant to use effectively dur- B. branding
ing an employment interview?
C. packaging
A. Occupational
D. labeling
B. Communication
84. Identify the level of product which fo-
C. Management
cuses on additional features, benefits or
D. Educational other related services that differentiate
the product from its competitors?
79. which of the following refers to marketing
channel? A. Augmented product
A. Integrated marketing communication B. Potential product
B. Distribution C. Core product
C. retailing D. Generic product
D. packaging 85. With which element is exchange mecha-
nism related?
80. Which of the following is an example of
A. Publicity
exploratory research?
B. Marketing
A. case study
C. Advertising
B. test marketing
D. Branding
C. survey
D. pilot study 86. Select the explanation for merchandising-
related discounts, Discounts given by man-
81. Which one of the following utilities is not ufacturers or retailers given to a company
directly related to marketing? in the same trade
A. Place A. Cash discounts
B. Possession B. Quantity discounts
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 774
C. Trade discounts A. Sales Orientation
D. Seasonal discounts B. Societal Marketing Orientation
87. Name the task of creating, promoting C. Marketing Orientation
and delivering goods and services to con- D. Production Orientation
sumers?
A. Marketing 92. It is how well clients and customers relate
to a specific brand.
B. Advertising
NARAYAN CHANGDER
C. Branding A. Brand resonance
D. Selling B. BAV Model
C. Brand Z Model
88. At this point in the Marketing Funnel, they
have already evaluated you and have de- D. Brand Equity
cided to do business with you in some
small way. 93. What is the function of marketing that
studies customer demand and product fea-
A. Interest
tures in order to place a value of money on
B. Evaluation a product?
C. Trial A. Finance
D. Adoption
B. Price
89. Which concept holds that achieving orga- C. Product/Service Management
nizational goals depends on knowing the
needs and wants of target markets and D. Selling
delivering the desired satisfactions better
than competitors do? 94. Which are pathways in the Marketing,
Sales, and Service career cluster? Select
A. product all that apply.
B. production A. Marketing Information Management
C. selling and Research
D. marketing B. Marketing Communications and Pro-
motion
90. Technology advancements have provided
marketers the ability to send cost- C. Professional Sales and Marketing
effective, opt-in promotional messages D. Buying and Merchandising
to a customer’s address.
A. P.O. Box 95. Which of the following is a question that
arises during the marketing exchange?
B. street
C. email A. What is it that customers want?
D. secondary B. Should the product be made in house
or outsourced?
91. Of the four competing philosophies, the
C. When should we sell our stock?
Furniture Industry is an example of what
kind of orientation: D. Should we acquire our competitor?
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 775
96. Shop for Rs. 2, 500 and get a coupan A. a customer group
worth Rs. 250 free. This is an example B. a target market
of
PRACTICE BOOK» NOT FOR SALE
C. a consumer market
A. Lucky draw
D. a possession utility
B. product combination
C. Assigned and assured gift 101. One method of increasing prices is us-
ing , where the company maintains its
D. Usable benefits price but removes or prices separately one
97. IT IS A WRITTEN DOCUMENT THAT SUM- or more elements that were part of the for-
MARIZES WHAT THE MARKETER HAS mer offer.
LEARNED ABOUT THE MARKETPLACE AND A. escalator clauses
INDICATES HOW THE FIRM PLANS TO B. unbundling
REACH ITS MARKETING OBJECTIVES.
C. unitary pricing
A. BUSINESS PLAN
D. demand pricing
B. STRATEGIC PLAN
C. MARKETING PLAN 102. How do producers benefit from the ex-
changes that result from marketing?
D. MARKET PLAN
A. By gaining repeat business
98. What type of segmentation occurs when B. By controlling their costs
Publix runs a “Going Green” promotion
to promote Earth Day and environmentally C. By obtaining unlimited resources
safe products? D. By increasing charitable contributions
A. Demographics 103. Determining the group of customers that
B. Psychographics will be the main target for a company’s
C. Geographics goods/services is done through
D. Product Benefit A. market strategy
B. market segementation
99. What should the salesperson do when she
or he is helping a customer and another C. a policy statement
customer enters the selling area? D. consumer behavior research
A. Apologize to the first customer for 104. Within 2 years of it’s inception, Bhav-
helping the second customer ishya Limited has created a very positive
B. Leave the first customer to help the reputation about itself and its products in
second customer the eyes of general public by participating
C. Acknowledge the second customer as extensively in various social welfare pro-
soon as possible grams. Identify the component of promo-
tion mixing described in the given lines.
D. Ignore the second customer until fin-
ished with the first customer A. Advertising
B. Sales promotion
100. Jared asked his mom to buy him Coco
Puffs after watching a TV commercial. To C. Public relation
what group does he belong? D. Personal selling
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 776
105. Retailers offer their customers install- which make products appealing and acces-
ment or layaway plans in order to increase sible to customers?
the utility of their products. A. Professional Sales
A. Information B. Marketing Management
B. Form C. Merchandising
C. Possession D. Marketing Communications
D. Place
NARAYAN CHANGDER
111. Encouraging team members to contribute
106. In , marketers divide buyers into to and take responsibility for the manage-
groups on the basis of their knowledge of, ment process.
attitute toward, use of or response to a A. middle management
product.
B. empowerment
A. All of the below C. controlling
B. Binary segmentation D. organizing
C. General subjection
112. An organization directs its marketing ef-
D. Behavioral segmentation forts at two or more segments by de-
veloping a marketing mix for each seg-
107. Who is called as the father of modern
ment. Identify the target marketing strat-
marketing?
egy adopted here?
A. MC Dalton
A. Multi-segment approach
B. Philip Kotler B. Concentration approach
C. MC Grew C. Total market approach
D. Edwin Mathew D. Differentiated market approach
108. What are you as a marketing team cre- 113. Wireless networks are now more com-
ate. mon due to
A. Brand Identity A. information overload
B. Brand Image B. increased distribution of the work-
C. Brand Recall force
D. Brand Recognition C. government regulations requiring
them
109. The process of setting standards and D. increased competition
evaluating performance.
A. empowerment 114. Digital has become a part of everything
we do as consumers. Companies that do
B. controlling not keep up with technology changes may
C. organizing find their products outdated. One of com-
pany that takes full advantage of digital
D. preventive discipline
technology in creating magical customer
110. Which pathway includes the duty of de- experiences is
signing and assembling product displays A. Disney
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 777
B. Nike B. Getting, keeping and growing cus-
C. Unilever tomers
PRACTICE BOOK» NOT FOR SALE
D. Mc. Donald’s C. creating, developing and communicat-
ing superior values
115. Which of the following is NOT a career
D. None of these
and technical student organization men-
tioned in the presentation? 120. which is not a digital marketing strat-
A. MSO egy?
B. DECA A. identify
C. BPA B. build
D. FBLA C. develop
116. Which of the following is NOT a career in D. engagement
the Marketing Research pathway?
121. Which of the following terms is used
A. Interviewers
to describe the factors and forces out-
B. Management side marketing that affect marketing man-
C. Research supervisors agement’s ability to build and maintain
successful relationships with target cus-
D. Support specialists tomers?
117. Lucille has created a six-page synopsis to A. the marketing environment
include as a section in the beginning of her
B. the cultural environment
224-page report. What should Lucille call
this section when she creates the report’s C. strategic planning
table of contents? D. the marketing mix
A. Executive summary
122. Which of the following is an example of a
B. Bibliography
customer inquiry about a product that an
C. Footnotes employee might need product knowledge
D. Results and recommendations in order to handle:
A. Is it designed to last?
118. Which of the stages in the Marketing Fun-
nel is not included? B. Is financing available?
A. Awareness C. Is delivery included?
B. Interest D. Is there a return policy?
C. Proclamation
123. Which of the following must appear on
D. Evaluation your resume:
119. Cadbury’s Dairy milk targeting youth af- A. Marital status
ter covering Children as their target mar-
B. Education
ket, refers to which step of process of mar-
keting C. Date of birth
A. Identifying the target market D. List of references
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 778
124. This refers to the customer’s assessment B. purchasing orders
of the benefits gained from the product or C. buying plans
service compared to the cost and compet-
ing offers on the market D. price quotations
A. perceived value 129. In this stage of the product life cycle,
B. expected value investment expenses are extremely high
and there are no sales yet
C. mutual benefit
A. Growth
NARAYAN CHANGDER
D. customer choice
B. Introduction
125. The product concept focus on the
C. Product Development
A. Quantity of a product produced
D. Maturity
B. Quality and performance of a product
E. Decline
produced
C. Maximising sales 130. In this stage of the product life cycle,
sales of the product fall and companies cut
D. Company which produced the product
prices as well as advertising and promo-
126. Hu Jintao, the dictator of China, makes tions of the product.
the decisions which affect the jobs and A. Growth
living conditions of people living in China.
B. Introduction
The economic system in China is closer to
which economic system? C. Product Development
A. Command D. Maturity
B. Market E. Decline
C. Tradionalist 131. Considering a continuum from mass mar-
D. Mixed keting to one-to-one marketing, market-
ing segmentation is
127. Procter & Gamble manufactures a variety
A. very close to mass marketing.
of brands under one category. An example
is shampoo with brands such as Pantene, B. very close to one-to-one marketing.
Herbal Essences, and Head and Shoulders. C. in the middle.
For shampoo, Procter & Gamble would ap-
propriately use D. on a different continuum.
A. marketing services management. 132. Which of the following is the right time
B. brand management. for a business to make promotional deci-
sions in relation to product, price, and dis-
C. category management. tribution decisions:
D. integrated management. A. After product, price, and distribution
E. regional management. B. Before product, price, and distribution
128. In searching out suppliers, industrial pur- C. Along with product, price, and distribu-
chasers should obtain from potential tion
vendors. D. Without considering product, price,
A. resource files and distribution
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 779
133. A company wants to know why sales of 138. An organization is gathering, recording,
a certain product are not growing. Its pur- and analyzing data about its target mar-
pose in conducting marketing research is ket. This activity is known as
PRACTICE BOOK» NOT FOR SALE
to A. marketing research
A. monitor B. test marketing
B. test hypotheses C. performing a case study
C. explain D. conducting experiments
D. predict
139. The marketing concept which aims to in-
134. What is the enviroment of Marketing crease profit from economies of scale
Management?
A. Marketing concept
A. school
B. Product concept
B. anywhere that plays the role of market
C. Societal marketing concept
C. traditional market
D. Production concept
D. modern market
140. Select the factor based on the explana-
135. What type of business policy is designed tion:Companies will modify or change their
to attract customers by making the pur- products to meet the needs of customers
chasing experience more convenient for based upon research and customers com-
them? ments. It is important that they keep up
A. Flexible with demand.
B. Employee A. Product Line (Depth, Extension & Con-
traction)
C. Product
B. Branding
D. Service
C. Packaging
136. There is a rule of thumb that says it costs
D. Product Modification
times more to acquire a new customer
compared to maintaining a loyal one. E. Repositioning
A. 3 141. When can core businesses change?
B. 6 A. when customers demand it
C. 9 B. when a firm updates their software
D. 12 C. when a firm’s competencies change
137. Manufacturer uses wholesalers and re- D. when a firm outsources
tailers to distribute goods to the cus-
tomers. Which level channel of distribu- 142. The channel of distribution for a product,
tion is the manufacturer using- or path that a product takes to get from
producer to consumer, should be ,
A. Zero and in order for a company to move
B. One their products effectively .
C. Two A. Cost effective
D. Multi B. Controlled for quality
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 780
C. Unpredictable B. pencil
D. Fast C. Laptop or computer
143. Which of the following help a business D. Soft drink
keep stock based on sales and allow them
to spend money based on a planned bud- 148. In an economic system, the decision to
get? hire more employees in order to make
more products is answering which eco-
A. Dollar Control
nomic choice?
NARAYAN CHANGDER
B. Unit Control
A. What to produce?
C. Stock Turnover
B. For whom to produce?
D. Stock lists
C. How to produce?
144. An advantage of using satellite tracking
D. When to produce?
technology in distribution is that it enables
businesses to 149. Paul’s plant food is losing its popularity
A. Analyze the contents of packages among his customer base. Which market-
B. know where shipments are at all times ing function would come up with the im-
proved product?
C. determine the delivery drivers’ qualifi-
cations A. Channel management
D. obtain information about competitors B. Product or service Management
145. Concentrated marketing is based around C. Selling
A. Focusing marketing efforts on a num- D. Promotion
ber of segments
150. Ben has the responsibility of improving
B. Focusing marketing effort on one seg- the product in the company he works for.
ment. He researches the market opportunities
C. Focusing marketing efforts on the and works to develop a better product for
mass market. his company to sell. This function of mar-
D. Focusing marketing effort on a partic- keting is called:
ular country. A. Channel Management
146. Is anything that can be offered to a mar- B. Marketing-Information Management
ket to satisfy a want or need. C. Product/Service Managment
A. Goods D. Promotion
B. Services
151. Businesses often obtain marketing infor-
C. Information
mation to
D. Product
A. monitor trends
147. Personal selling would be a cost-
B. implement procedures
effective form of promotion for which of
the following products: C. delegate authority
A. Newspaper D. investigate terms
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 781
152. Which of these is NOT one of the five pri- 157. What does applying the customer-
mary data collection methods discussed in orientation element of the marketing con-
the chapter? cept enable the business to do?
PRACTICE BOOK» NOT FOR SALE
A. Observation A. Offer products that consumers want to
B. Focus groups buy
C. Surveys B. Persuade customers to buy its product
D. Behavioral data C. Provide more products than con-
sumers need
E. Prototyping
D. Coordinate its marketing activities
153. The most common form of business own-
ership in the United States is 158. Identify the type of market research data
A. Partnership based on the characteristics below:Data
regarding competitors, their products, and
B. Sole Proprietorship their territory, etc that can be used to im-
C. Corporation prove a company’s market position
D. Limited Liability Corporation (LLC) A. Company data
154. Labor-union negotiations are part of B. Competitor data
which HR management activity? C. Government data
A. Staffing D. Market research data
B. Compensation and benefits
159. percentage of total sales generated by
C. Training and development competing companies is:
D. Employee relations A. channel management
155. Be cool limited has decided to market B. selling
its products through the conventional
C. market share
network of manufacturer-wholesaler-
retailers-consumer. Identify the function D. product/service management
of marketing being described in the above
160. Branding is manifesting building a great
lines.
brand as the most fun and creatively re-
A. Physical distribution warding parts of growing a business.
B. Transportation A. science
C. Warehousing B. process
D. Standardisation and grading C. art
156. From now until 2024, Virginia will expe- D. preference
rience a growth in the Marketing Ca-
reer Cluster. a. 5% b. 11% c. 9% d. 161. If a company purchases survey results,
7% this is called:
A. A A. Primary research
B. B B. observational research
C. C C. secondary research
D. D D. ethnographic research
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 782
162. Which of the following is a function 167. Which of the following is a series of or-
that is an important part of the human ganized activities working towards a par-
resources management activities of busi- ticular goal?
ness:
A. Nonprofit
A. Promoting
B. Public relations
B. Pricing
C. Campaign
C. Selling
D. Promotions
NARAYAN CHANGDER
D. Staffing
168. What makes distribution an important
163. The role of brands varies to its functional function in marketing?
level where building comprehensive brand
A. It helps inform customers
experience is visible.
B. It helps customers make a decision
A. Product Diversification
about a purchase
B. Product Innovation
C. It gets the product to the consumer at
C. Product Planning the right time and place.
D. Product Performance D. It helps the company make good mar-
keting decisions
164. What is another way to describe finan-
cial information that is true, complete, and 169. Which is the technique of sales promo-
faithfully represented? tion?
A. Timely A. Mela
B. Understandable B. Distribution sample
C. Comparable C. Lottery
D. Reliable D. All of these
165. What does continuously monitoring in- 170. means that each customer serves as
ternal marketing information enable busi- his or her own segment.
nesses to do?
A. Geographic marketing
A. Investigate competitors
B. One-to-one marketing
B. Identify problems
C. Mass marketing
C. Evaluate market share
D. Psychological marketing
D. Analyze economic changes
171. The administration of assets refers to de-
166. Product, Place, Promotion, Price cisions about
A. Utilties A. spending
B. Market Share B. accounting
C. Marketing Mix C. investments
D. Functions D. financing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 783
172. Consumers have unique needs and de- 177. Under the Total Costumer Cost, a type of
sires. Economists call this Customer Perceived Value that relates to
the mental effort and exertion that the cus-
PRACTICE BOOK» NOT FOR SALE
A. inperfect competence
tomer undertakes to buy and use the prod-
B. imperfect competition uct.
C. diverse demand A. Mental Cost
D. diverse marketing B. Time Cost
173. What has consequences in the interaction C. Energy Cost
between the service provider and the cus- D. Psychological Cost
tomer?
178. Select the technique and example used
A. The inseparability of production and
in pricing products.Technique:Pricing multi-
consumption
ple products together rather than by them-
B. The perishability of the item selves to send a message of value and in-
crease sales volume. Example:3 cookies
C. The age of the customer
for $1
D. The elasticity of demand
A. Odd-Even Pricing
174. What is a bachelor’s degree? B. Prestige Pricing
A. a four year undergraduate degree C. Multiple Unit Pricing
B. a two-year undergraduate degree D. Bundle Pricing
C. a diploma of completion
179. Which career pathway requires that
D. a graduate degree employees have stamina, stress-
management skills, confidence, persua-
175. A striking line or phrase that would make siveness, and specialized knowledge
your brand remarkable to the customer. about a product or service?
A. Labelling A. Professional Sales and Marketing
B. Slogan B. Marketing Information Management
C. Logo and Research
D. none of above C. Marketing Communications and Pro-
motion
176. As prices for a product decrease, D. Buying and Merchandising
A. Supply Increases & Demand De-
creases 180. A marketing plan forces the marketing
team to put its goals in writing, making
B. Supply Increases & Demand In- those goals
creases
A. less specific
C. Supply Decreases & Demand In-
B. easier to remember
creases
C. better than those of competitors
D. Supply Decreases & Demand De-
creases D. less risky
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 784
181. To know about religious affairs is called- C. Marketing Mix
A. Advertisement D. Product/Service Mix
B. Publicity 186. AMONG THE 3 TYPES OF DIVERSIFICA-
C. Promotion TION STRATEGIES, IS A MUCH RISKIER
D. Marketing STRATEGY THAN THE 2 OTHER TYPES.
A. CONCENTRIC DIVERSIFICATION
182. The Potteryware company decided to
B. CONGLOMERATE DIVERSIFICATION
NARAYAN CHANGDER
sell its coffee mugs in the local coffee
houses. What type of marketing decision C. HORIZONTAL DIVERSIFICATION
was this? D. none of above
A. price
187. For the security precaution listed below,
B. promotion select the option(s) that would help de-
C. place ter shoplifting, robbery, or employee theft.
Use S, R, and ET to indicate your choice-
D. product
Limit amount of cash on site
183. Highway 1 Restaurant allows customers A. S (Shoplifting)
the opportunity to enter drawings in order
B. R (Robbery)
to win a birthday cake. Customers regis-
ter by providing their contact information C. ET (Employee Theft)
on a card. What does entering the draw- D. none of above
ings represent?
188. The main function of is to provide in-
A. Tactic
formation required by law.
B. Strategy
A. Labelling
C. Goal
B. packaging
D. Trend
C. Branding
184. In today’s world, marketing should be D. all the above
done by employee in organization
189. This is a deeply held commitment to re-
A. marketing
buy or patronized a preferred product or
B. marketing, sales and customer sup- service.
port
A. Awareness
C. sales and technology
B. Trial
D. management and marketing C. Loyalty
E. all D. Interest
185. What is the term that describes the deci- 190. The policy at Will’s Hardware store is
sions a company makes regarding all of the that if you find a lower price at a competi-
different types of products the company tor’s store, they will match the price. This
will sell? is known as a goal in pricing where the
A. Market segmentation firm will meet the
B. Marketing A. Market share
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 785
B. Return on investment 195. Market is the process of classifying
customers by needs and wants.
C. Competition
PRACTICE BOOK» NOT FOR SALE
A. Share
D. Cost-Benefit Analysis
B. Target
191. Which of the follwong is non-personal C. Segmentation
and non-paid form of promotion mix?
D. Profiling
A. Advertisement
196. Using the push strategy is most appropri-
B. Sales Promotion ate when
C. Publicity A. the product being sold is an impulse
D. Personal Selling item
B. there is high brand loyalty for the prod-
192. Marketing plans help marketers under- uct
stand past decisions and outcomes better
so that they can avoid C. the product is a high involvement pur-
chase
A. repeating past mistakes
D. consumers choose the brand before
B. writing new marketing plans they go to the store
C. explaining problems to management 197. Decision regarding credit sale belongs to
D. losing market share which type of Marketing mix?
A. Price
193. Haiti’s economy is based mainly on agri-
cultural products such as coffee. This is B. Product
considered which type of economic sys- C. Physical Distribution
tem? D. Promotion
A. Command
198. Yayasan Al-Bukahari is an organization
B. Market that donates part of its earning to local
C. Traditional charity organizations. Yayasan Al-Bukhari
has which type of marketing management
D. Mixed philosophy.
194. When Lois, a small business owner, de- A. production
cides to become a sponsor in his local com- B. sales
munity’s annual Cancer Walk in order to C. promotion
create publicity for his company, he is mak-
ing decisions in relation to the market- D. societal
ing function.
199. Which of the following is the primary
A. Promotion computer-system tool used to input data:
B. Marketing Information Systems/Market A. Software
Research B. Printer
C. Product/Service Management C. Keyboard
D. Selling D. Hardware
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 786
200. Satisfying customer needs and wants What type of data would be helpful in this
while meeting organizational objectives endeavor?
A. Sales A. geographic
B. Production B. product benefits
C. Market C. demographic
D. Societal D. psychographic
NARAYAN CHANGDER
201. What is the fullname of the reporter in
206. The marketing function of is used
Creating Brand Equity?
when Mayfield Milk decides how many
A. Josh Cabural trucks to use to transport its products in a
B. Josua Cabural timely manner to reduce product spoilage.
C. Joshua Cabural A. Selling
D. Joshuah Cabural B. Distribution
202. Refer to a value premium that a a com- C. Financing
pany generates from a product with a D. Pricing
recognizable name when compared to a
generic equivalent. 207. According to the production concept, con-
A. Brand Value sumers will favor products that are
and
B. Brand Equity
A. satisfying; quality focused
C. Brand Positioning
D. Brand Performance B. available; affordable
C. in high demand; hard to find
203. Where in a marketing plan would a busi-
ness discuss how it plans to communicate D. segmented; convenient
with its customers?
208. The company’s mission, objectives, broad
A. marketing objecgtives strategies, and policies are set by man-
B. situation analysis agement.
C. executive summery A. Mid-level
D. marketing strategies and procedures B. Top
204. A farmer with a produce stand in the yard C. Marketing
is an example of a distribution channel.
D. None of these
A. Producer to retailer to consumer
B. Producer to agent to consumer 209. The function of marketing informs about
needs and wants of consumers
C. producer to consumer
A. Market Planning
D. producer to wholesaler to consumer
B. Customer support services
205. The Music Stand direct-mail company
C. Promotion
wants to send catalogs to music teach-
ers, dancers, and other music consumers. D. Gathering and Analysing information
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 787
210. This involves the process and methods 215. Select all that applies; characteristics of
used to gather information, analyze it, and Business marketers are
report findings related to marketing of
PRACTICE BOOK» NOT FOR SALE
A. Elastic demand
goods and services
B. Fewer, larger buyers
A. Survey Creation
C. professional purchasing
B. Marketing Research
D. Multiple buying influence
C. Advertising Selection
E. close supplier-customer relationship
D. Marketing Discovery
211. Designing an effective marketing strat- 216. who is the father of modern marketing?
egy is important A. Peter Drucker
A. but not possible to achieve B. Philip Kotler
B. to the success of the business C. Lester Wunderman
C. as a promotion function D. Abraham Masloco
D. as a one-time process
217. is a type of segmentation in which the
212. The dimension of product mix which mea- company strategically focuses on target-
sures how closely the different product ing a smaller market with particular needs
lines are related is referred to as: that the company can serve well.
A. Width of product mix A. Mass marketing
B. Length of product mix B. Demographic marketing
C. Depth of product mix C. Niche marketing
D. Consistency of product mix D. One-to-one marketing
213. is a very economical mode of commu- 218. A company takes to convert products
nication if large number of people are to from concepts to market-ready solutions.
be reached. The approach is called as
A. Public Relations A. Core concept
B. Advertising B. Customer relationship
C. Personal Selling C. Value Chain
D. Sales promotion D. Customer loyalty
214. Ebay is an example of what type of busi- 219. The inseparability of production and con-
ness represented in our society? sumption also impacts the interaction be-
A. Service tween the and the
B. Global/International A. service provider; customer
C. Retail B. service provider; manufacturer
D. Online C. variability; customer
E. Franchise D. variability; manufacturer
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 788
220. IT IS A PROCESS OF MEASURING 225. There is only one boss. The customer.
THE PERFORMANCE OF A COMPANY’S And he/she can fire everybody in the com-
PRODUCTS, SERVICES, OR PROCESSES pany from the chairman on down, simply
AGAINST THOSE OF ANOTHER BUSINESS by spending his money somewhere else.
CONSIDERED TO BE THE BEST IN THE IN- A. Sales
DUSTRY.
B. Production
A. VALUE CHAIN
C. Market
B. BENCHMARKING
NARAYAN CHANGDER
D. Societal
C. SWOT ANALYSIS
D. STRATEGIC PLANNING 226. Main objective of Marketing is-
221. A company’s marketers guess that if they A. To increase sales
invest in sales force training, sales will in- B. Profit earning
crease by 15%. This guess is called a(n)
C. To increase production
A. simulation D. To satisfy the customer need
B. hypothesis 227. Chick-Fila is an example of what type of
C. independent variable business represented in our society?
D. pilot study A. Service
B. Global/International
222. What is the definition of a company’s
core business similar to? C. Retail
A. goal statement D. Online
B. code of conduct E. Franchise
C. the industry
228. In this type of Organizational Chart there
D. mission statement is a chain of command. Where, a higher po-
sition, such as Top Management, is valued
223. One way to obtain reliable and up-
more.
to-date information about employment
trends in a certain career or field is by A. Modern Customer-oriented Organiza-
tional Chart
A. speaking with a salesperson
B. Traditional Organizational Chart
B. reading older periodicals
C. asking retired workers C. Team-based Organizational Chart
D. visiting government websites D. Divisional Organizational Chart
224. What does it takes to become good sales 229. A cardboard box consisting of 10 packets
person? except of 1 kg sugar is an example of:
A. never give up A. Primary packaging
B. keep practicing B. Secondary packaging
C. Remember the failure C. Transportation packaging
D. get ready to get hit D. None of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 789
230. To use various software programs, a com- A. the competitors
puter must have a(n) B. the Intermediaries
PRACTICE BOOK» NOT FOR SALE
A. search engine mechanism C. the publics
B. internet connection D. none of above
C. operating system 235. The Publics does NOT include:
D. task toolbar A. Financial
231. Which two are disadvantages of focus B. Government
groups? C. Local
A. Able to gather opinions, attitudes and D. the company
beliefs regarding products
236. J.D. Power and Associates ranked Jaguar
B. The focus group is not managed prop- highest in customer satisfaction with
erly dealer service among luxury automotives.
C. The group is too small for reliable re- A. Production
sults B. Sales
D. Provides meaningful qualitative data C. Market
232. Amy-Jo works for herself selling weight- D. Societal
loss products door to door. This is
237. Which marketing function helps business-
A. not typical, because most door-to-door people forecast how much will be sold in a
salespeople work for companies. given period?
B. not typical, because products are A. Market panning
rarely sold door to door. B. Risk Management
C. typical, because most door-to-door C. Promotion
salespeople are self-employed.
D. Channel Management
D. typical, because most weight-loss
products are sold door to door. 238. Which of the following is an advantage
of personal selling over advertising in the
233. Computerized databases make it possible promotional mix:
for marketing researchers to A. Immediate feedback through a pur-
A. obtain desired information immedi- chase
ately B. Less costly per contact
B. limit their use of biographical C. Less flexible
databases D. No face-to-face contact
C. gain unrestricted access to statistical
239. In this stage of the product life cycle, mar-
data
keters develop extensions of products and
D. reduce the use of off-line data collec- prices are set to beat or match the comple-
tion methods tion. Sales are at the highest and branding
is highly important.
234. Firms that help the company to promote,
sell, and distribute the products to the fi- A. Growth
nal customers or buyers. B. Introduction
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 790
C. Product Development 245. Which of the following is an important
D. Maturity benefit of marketing plans?
E. Decline A. They develop exciting products
B. They help recruit quality employees
240. The differences in the education and skills
C. They ensure a yearly profit
of the workforce are reasons why market
economies usually experience D. They can help obtain funding
NARAYAN CHANGDER
A. unequal income distribution. 246. Rodney just earned his master’s degree
B. low unemployment levels in Marketing. Based on his education,
which job would he be best suited for?
C. unpredictable taxation rates
A. Supply Chain Manager
D. minimal profit margins.
B. Survey Researcher
241. Which stage has the highest advertise-
C. Logistic Analyst
ment
D. Marketing Specialist
A. Growth
B. Maturity 247. The term Brand Loyalty can be defined as:
C. decline A. The tendency to buy a particular brand
of a product.
D. Introduction
B. Estimating future sales of one or more
242. Which of the following is a force that products or services.
does NOT affect the Microenvironment? C. The amount of goods available to a po-
A. The company tential market.
B. The Suppliers and Intermediaries D. Consumer willingness and ability to
buy products
C. Customers
D. The economic environment 248. What is the goal of Marketing Manage-
ment?
243. A supersegment is a set of segments
A. To sell
sharing some similarity.
B. To buy
A. Explosive
C. To see the ratio of buy and sell
B. Alluring
D. To have an understanding of how Mar-
C. Exploitable
kets work
D. none of above
249. In which testing the company with the
244. Which of the following starts from fa- new product specifies the number of stores
cotry? and geographic locations it wants to test?
A. Product concept A. Controlled Test Marketing
B. Selling concept B. Test Markets
C. Production concept C. Simulated Test Marketing
D. All of these D. Sales-Wave Research
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 791
250. Which of the following is an example of a C. tedious
right that workers should expect to have
D. thorough
in the workplace:
PRACTICE BOOK» NOT FOR SALE
A. Freedom from discrimination 255. Buy ‘LED Television and a DVD Player’
B. Flexible work schedule for Rs. 30, 000. This is an example of:
C. Unlimited personal time A. Quantity gift
D. Access to company information B. Discount
251. The principle of implies that communi- C. Rebate
cators can use their good image to reduce
some negative feelings toward a brand D. Product combination
but in the process might lose some esteem
with the audience. 256. Modern concept of marketing starts
A. conformity with:
B. congruity A. Purchase
C. confidence B. Storage
D. credibility C. Consumer research
252. IT CONSISTS OF PEOPLE, EQUIPMENT, D. Promotion
AND PROCEDURES TO GATHER, SORT,
ANALYZE, EVALUATE, AND DISTRIBUTE 257. When a company sets a price for a prod-
NEEDED, TIMELY, AND ACCURATE INFOR- uct, which of the following are consid-
MATION TO MARKETING DECISION MAK- ered?
ERS.
A. Consumer perception and supply & de-
A. MARKETING SYSTEM
mand
B. MARKETING INFORMATION
B. Cost of raw materials, supply & de-
C. MARKETING INFORMATION SYSTEM mand, competitor’s price, consumer per-
D. MARKETING INTELLIGENCE SYSTEM ception
253. deciding how goods get into customers C. Supply & Demand and Competitor’s
hands is: Price
A. channel management D. Cost of raw materials and consumer
B. selling perception
C. market share
258. Which of the following is NOT usually
D. product/service management defined as an element of the marketing
mix?
254. A marketing-research project that gath-
ers sufficient information to help the busi- A. Product
ness in its decision making would be de-
B. People
scribed as
A. predictive C. Place
B. efficient D. Profit
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 792
259. Mansi, a shoe manufacturer for school C. cookies
students, decided to maximise profits by D. hyperlinks
producing and distributing shoes on a
large-scale and thus reducing the aver- 264. Which is not the mode of labelling?
age cost of production.Identify the market- A. Descriptive
ing management philosophy adopted by
Mansi. B. Formative
A. Production C. Utilitative
NARAYAN CHANGDER
B. Product D. Periodic Index
C. Marketing 265. Performance that one party can offer to
D. Selling another that is essentially intangible is
known as
260. A business’s brand promise is intended to A. Strategy
accomplish which goal?
B. Distribution
A. Name its product
C. Services
B. Sell to the target market
D. Satisfaction
C. Provide the customer
D. Use as a trademark 266. Which of the following is an example of
excess demand:
261. Symbol is used in which cases? A. Price = $500, demand = 500, supply
A. Labelling = 500
B. Publicity B. Price = $400, demand = 600, supply
C. Packaging = 400
D. None of these C. . Price = $600, demand = 400, supply
= 600
262. External marketing data comes from D. Price = $700, demand = 300, supply
sources outside the business such as = 700
A. trade journals
267. IT REFERS TO THE QUALIFIED AVAILABLE
B. inventory records MARKET THAT THE COMPANY DECIDES TO
C. customer complaints PURSUE.
D. sales forecasts A. POTENTIAL MARKET
263. Ken is developing a web page for a B. AVAILABLE MARKET
new bed-and-breakfast inn. He wants to C. TARGET MARKET
add information on the web page that de- D. PENETRATED MARKET
scribes local tourist attractions and restau-
rants. To allow website visitors the ability 268. One company licenses another to pro-
to visit these other websites from the bed- duce its product, or two companies jointly
and breakfast inn’s website, Ken should market their complementary products is
create known as
A. a site map A. Strategic alliances
B. portals B. Promotional alliances
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 793
C. Logistics alliances C. Government data
D. Product alliances D. Market research data
PRACTICE BOOK» NOT FOR SALE
269. It is helpful to think of goods and services 274. Contains information about the product
as on its container, packaging, or the product
itself.
A. existing along a continuum
A. Labelling
B. similar
B. Logo
C. different
C. Slogan
D. comprised of both logistics and tangi-
ble items D. none of above
275. How can we sell more aggressively?
270. Which of the following could not be mar-
keted? A. Sales
A. On-line trading, Business processing B. Production
outsourcing etc. C. Market
B. Sports events, Music concert etc. D. Societal
C. Visit Udaipur-“The City of Lakes” 276. Mansi took her niece Ridhima for shop-
D. None of these ping to ‘Mega Stores’ to buy her a bag for
her birthday. She was delighted when on
271. Which of the following is an umbrella payment of the bag she got a pencil box
term referring to any type of Internet along with the bag free of cost. Idenfity
transaction: the technique of sales promotion used by
A. URL the company.
B. E-commerce A. Product combination
C. Business B. Quantity Gift
D. Website C. Refund
D. Gift
272. The fact that snow-blowers tend to sell
better in the North than in the South illus- 277. What does the selling function involve
trates the importance of considering in that makes it so important?
marketing planning. A. Setting high prices
A. climate B. Displaying products
B. urban living C. Contacting customers
C. culture D. Obtaining feeback from vendors
D. age 278. Which type of promotion would a com-
pany choose in order to raise the image
273. Identify the type of market research data
of the company and/or its products?
based on the characteristics below:Data
collected by a company regarding sales of A. Advertising
a particular product or time period, etc B. Publicity
A. Company data C. Personal Selling
B. Competitor data D. Sales Promotion
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 794
279. marketing means- 285. What is the communication by the mar-
A. Transfer of ownership keter to its target customers regarding its
products or services?
B. Selection of marketing technique
A. Product
C. Selling agent & sales promotion
B. Price
D. All of these
C. Place
280. The buying process starts when the buyer
D. Promotion
NARAYAN CHANGDER
recognizes a
A. Product 286. Which tool of promotion mix is an imper-
sonal paid form of communication?
B. an advertisement for the product
A. Sales promotion
C. a salesperson from a previous visit
D. problem or need B. Advertisement
C. Publicity
281. What might a business do if it is running
out of a popular product? D. Personal selling
A. Order substitutes 287. Any group that has an interest or impact
B. Reduce the price in the organization’s ability to achieve the
objectives are
C. Hold a sale
A. the suppliers
D. Place a reorder
B. the intermediaries
282. Which type of economic system occurs
C. the competitors
when both the government and individuals
own factors of production? D. the publics
A. Command 288. Which of the subsequent terms best de-
B. Market scribes the environment that includes the
C. Traditional forces getting ready to the corporate that
has an effect on its ability to serve its
D. Mixed customers-the company, suppliers, pro-
283. What does a group’s leader do? moting channel companies, client markets,
competitors, and publics?
A. Takes the meeting minutes
A. macro environment
B. Puts the group on a certain course
B. global environment
C. Makes sure the group members agree
C. micro environment
D. Follows up with everyone
D. networked environment
284. A is comprised of several product
lines that can vary in breadth and depth. 289. what stage is the longest
A. product mix A. growth
B. marketing mix B. maturity
C. company C. introduction
D. service D. decline
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 795
290. A copywriter is part of which of the fol- 295. Businesses that buy products for use in
lowing Marketing Pathways? a. Market- their operation
ing Communications b. Merchandising c.
PRACTICE BOOK» NOT FOR SALE
A. consumer market
Marketing Research d. Professional Sales
B. buyers market
A. A
C. customer market
B. B D. industrial market
C. C
296. “Business goods are often purchased by
D. D trained purchasing agents, who must fol-
low their organizations purchasing poli-
291. Third factor of Marketing Mix is- cies, constraints and requirements.” What
A. Size of product is that known as?
B. Place & distribution of product A. Professional purchasing
C. Production of goods B. Buying influence
D. Consumer C. Either option A or B
D. Formal purchasing
292. Type of products which cannot be sold
without technical knowledge- 297. Different parts of a business consider as
one single entity is known as?
A. Durable
A. Environmental marketing
B. Industrial
B. Holistic marketing
C. Convenience C. Societal marketing
D. none of above D. Industrial marketing
293. The products concept holds that con- 298. In order to promote the habit of health
sumers will buy products that offer and hygiene among weaker sections of the
the most quality performance and fea- society, Home Products has launched low
tures.These are refer as cost packs of hand wash. Identify the type
A. Production of marketing philosophy being adopted by
the company.
B. Product concepts
A. Product Concept
C. Selling Concept
B. Production Concept
D. Marketing concepts C. Marketing Concept
294. Marketers have long realized the bene- D. Societal Marketing Concept
fits of morphing purchase-transaction
299. Differences in and preferences re-
exchanges into long-term relationship
quire that different products be provided
marketing.
to satisfy the different segments’ needs.
A. short-term A. companies
B. high quality B. targets
C. customer C. perceptions
D. product D. consumers
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 796
300. What are the three types of research? 305. Select the factor based on the explana-
A. Causal, Exploratory, and Observa- tion:Companies will change the position of
tional their product in the market in order to bet-
ter compete.
B. Descriptive, Exploratory and Causal
A. Product Line (Depth, Extension & Con-
C. Open ended questions, Closed ended traction)
questions, and Focus Groups
B. Branding
D. Primary, Secondary, and Sampling
NARAYAN CHANGDER
C. Packaging
301. Which of the following firms is most
likely to seek radical innovation? D. Product Modification
A. a traditional publishing company E. Repositioning
B. a small scale FMCG company
306. obtaining, developing, or improving a
C. a firm that procures and markets
product is:
wheat
D. a high-tech firm in telecommunications A. channel management
B. selling
302. The marketing objectives section of a
marketing plan includes information about C. market share
D. product/service management
A. the company’s finances
B. the desired target market(s) 307. The owners of the Totally Outrageous
Shoe Store decided to rent store space
C. potential issues the marketing team
next to a music store where teenagers fre-
must overcome
quently shop. What did the owners’ deci-
D. marketing strategies and programs sion add to their product?
303. Needs of are being focused in Mar- A. promotion
keting. B. place utility
A. Customer
C. time utility
B. producer
D. improved distribution
C. Retailer
D. wholesaler 308. Planning, organising, directing and con-
trol of the activities which facilitate ex-
304. Beta company makes items you typically change of goods and services between pro-
see in a sports store. If they sell golf balls, ducers and consumers or users of products
which of the following would be expansion and services refers to
in the breadth direction?
A. management
A. first aid
B. golf clubs B. financial management
C. soccer balls C. marketing management
D. fishing gear D. none of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 797
309. Which of the following exemplifies clear 314. Training employees on safety procedures
and correct definition what Brand is? is an example of which of the following
ways to manage risk?
PRACTICE BOOK» NOT FOR SALE
A. Its a strategy
B. the most valuable intangible assets A. Avoid
C. The customer-based-centered strat- B. Shift
egy
C. Retain
D. All of the choices are correct
D. Reduce
E. Choices are correct except choice B
310. The business orientation should not be 315. What type of segmentation occurs when
short-sighted too serve only consumers Bath & Body Works sells a new lotion that
needs. It should also consider large issues will leave skin feeling smooth and younger
of long-term social welfareThe marketing looking?
management philosophy highlighted above A. Demographics
is:
B. Psychographics
A. The marketing concept
B. The societal marketing concept C. Geographics
C. The selling concept D. Product Benefit
D. none of above
316. Marketing is a process which aims at
311. XYZ Company noticed that the sales
A. Production
of iPads in blue have increased in sales.
What can the business determine about B. profit making
the iPads?
C. selling products
A. Product popularity
D. satisfaction of customer needs
B. Research methods
C. Economic resources 317. Name the process of creating a unique
D. Competitor activity name and image for a product in the minds
of consumers?
312. What are tThe two life cycles learned in
unit 8 A. Product positioning
A. Business cycle B. Repositioning
B. The product life cycke C. Branding
C. Technology life cycle D. Labelling
D. Owner life cycle
318. Customer service representatives fall un-
313. A marketing plan is designed to attract der which pathway?
target customers through a set of
A. Marketing Management
A. workshops
B. strategies B. Merchandising
C. rules C. Marketing Research
D. mergers and acquisitions D. Marketing Communications
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 798
319. Scope of is limited but scope of is 324. It consists of the actors and forces out-
wider. side marketing that affect marketing man-
agement’s ability to build and maintain
A. marketing, selling
successful relationships with target cus-
B. selling, marketing tomers.
C. Marketing, Publicity A. Marketing Environment
D. Selling, Manufacturing B. Macroenvironment
C. Microenvironment
NARAYAN CHANGDER
320. Advertisment helps in size of busi-
ness. D. none of above
A. Narrow 325. Charlie wants to be self-employed.
Which career in the Marketing, Sales, and
B. Limited
Service career cluster has the highest rate
C. Wide/Large of self-employment?
D. Medium A. Street Vendor
B. Merchandise Displayer
321. REMIEL JACOB MONITOR THE CHANGES
IN POPULATION TO BE UPDATED IN THE C. Demonstrator
CHANGES HAPPENING IN WHAT ENVI- D. Real Estate Agent
RONMENTAL FORCE?
326. Pricing is often used in a firm’s strat-
A. DEMOGRAPHIC ENVIRONMENT egy.
B. ECONOMIC ENVIRONMENT A. Profits
C. TECHNOLOGICAL ENVIRONMENT B. Advertising
D. POLITICAL LEGAL ENVIRONMENT C. Value & image
D. Product & management
322. What is the relationship between data
and information? 327. TAMAGOCHI TOY ONLY LAST FOR LESS
A. data and information are the same THAN A YEAR IN THE MARKET. THIS IS
thing AN EXAMPLE OF
A. TREND
B. data are used to create information
B. FASHION
C. information is used to create data
C. MEGATREND
D. data and information are not related
D. FAD
323. Personally communicating with the cus-
328. What am I? The purchasing dept. re-
tomer in order to help them purchase a
orders items like office supplies and bulk
product.
chemicals on a routine basis and chooses
A. Promotion from suppliers on an approved list.
B. Marketing Information Systems/Market A. Modify rebuy
Research B. straight rebuy
C. Selling C. New task
D. Pricing D. All the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 799
329. What are the four stages in the product 334. What are the streams in which con-
life cycle? sumers, the press, or other outsiders vol-
untarily communicate something about the
PRACTICE BOOK» NOT FOR SALE
A. Introduction, Growth, Climax, Decline
brand.
B. Start, Growth, Decline, Retire
A. Paid media
C. Introduction, Growth, Maturity, De-
cline B. Earned media
D. Conceptualisation, Introduction, Matu- C. Nonpaid media
rity, Decline
D. Owned media
330. Which of the following is a consideration
in the price element of marketing: 335. The process of planning, pricing, promot-
ing, selling and distributing ideas, goods,
A. Will the business use publicity? or services to create exchanges satisfying
B. Where will the products be stored? customers is
C. Should the business offer discounts? A. advertising
D. When will research be conducted? B. marketing
331. The pyramid of corporate social responsi- C. utility
bilities contains all of the following compo- D. market share
nents EXCEPT:
A. economic responsibilities 336. Products which are usually purchased due
B. cultural responsibilities to adversity and high promotional back up
rather than desire are called as:
C. ethical responsibilities
A. Sought goods
D. legal responsibilities
B. Unique goods
332. As output of each worker increases,
C. Unsought goods
A. Productivity increases and profits in-
crease D. Preferred goods
B. Productivity decreases and profits in- 337. Tangible items are
crease
A. Utilities
C. Productivity increases and profits de-
crease B. Value
D. Productivity decreases and profits de- C. Goods
crease D. Services
333. In a , competitors strategic positions
338. in what stage is here little to no competi-
in major geographic or national markets
tion
are affected by their global positions.
A. Global firm A. Growth
B. Global Industry B. Introudction
C. Dealership C. Decline
D. competitive structure D. Maturity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 800
339. When the demand of a product is inelas- 344. Employees who arrive at work on time
tic, the firm is in a position to fix and direct their own work-related activi-
prices. ties during the course of the day usually
possess positive skills.
A. Higher
A. personal-orientation
B. Lower
B. self-conceptual
C. Similar
C. inner-qualitative
D. Competitive prices
NARAYAN CHANGDER
D. self-managerment
340. The term market may be understood in 345. A is a structured approach to assess-
which of the following contexts? ing the source s and outcomes of brand eq-
A. Geographical area covered uity and the way marketing activities cre-
ate brand value.
B. Type of buyers
A. Value chain
C. Quantity of goods transacted
B. Brand value chain
D. All of the above
C. Program chain
341. The results of descriptive research are of- D. none of above
ten
346. Select the factor based on the explana-
A. qualitative tion:Marketers spend a lot of money and
B. vague research on creating a brand image that
customers will recognize and remain loyal
C. unreliable to.
D. quantitative A. Product Line (Depth, Extension & Con-
traction)
342. The Underwriters Laboratory seal on an
B. Branding
electrical product indicates
C. Packaging
A. quality and safety backed by a testing
organization D. Product Modification
B. a guarantee by the manufacturer E. Repositioning
C. the product can be returned 347. The changing age structure population.
D. standard grades established by the A. Political Environment
federal government B. Demographic Environment
C. Economic Environment
343. People in this category are looking for
the lowest prices because they want the D. Natural Environment
best value for their money.
348. Car dealers emphasize personal contact
A. Seller’s Market with their customers in order to better de-
termine and respond to customer needs
B. Buyer’s Market
and wants. This is an example of which
C. Government marketing function?
D. Market A. product/service management
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 801
B. marketing information management C. Advertising
C. selling D. Sales Promotion
PRACTICE BOOK» NOT FOR SALE
D. distribution
354. Responsible for building and growing a
349. Management is important in an organiza- company or organization’s brand.
tion because it actually
A. Brand Management
A. Determines what customers will be
targeted B. Promotion
B. Maintains financial statements for a C. Advertising
business D. none of above
C. Produces products and runs machin-
ery 355. is called marketer
D. Establishes rules and policies as well A. Satisfaction Seeker
as puts operating plans into action
B. Satisfaction Provider
350. are the attributes of a product or ser-
C. Seller
vice.
A. Function D. Service Provider
B. Marketing Mix 356. The results of exploratory research are
C. Share often
D. Utility A. specific
351. Example of Non-metalic goods is- B. qualitative
A. Food C. quantitative
B. Machinery D. unusable
C. music
357. characteristics such as shopping patterns
D. none of these
and decision-making processes are:
352. Company XYZ has predicted it will sell 3, A. demographics
000 new microwaves during the “Back to
School” sale. Which marketing function is B. psychographics
this business using? C. geographics
A. Market planning
D. behavioral
B. Risk management
C. Promotion 358. is want for specific product backed by
ability to pay.
D. Channel Management
A. Want
353. It is an impersonal and paid tool of pro-
motional mix: B. Need
A. Publicity C. Customer
B. Personal selling D. Demand
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 802
359. The purpose of this marketing function is 364. Customer is the of the market
to set an financial charge for a product that
A. Servant
will maximize profit
B. King
A. Channel Management
B. Product Service Management C. Sympathiser
C. Marketing Planning D. Seller
D. Marketing Information Management 365. Obtaining the money needed to start and
NARAYAN CHANGDER
(MIM) operate a business is a marketing function
E. Pricing known as
360. What is the relationship between re- A. Market research
search purpose and research design? B. Pricing
A. purpose dictates design C. Distrubuting
B. there is no relationship between the
D. Financing
two
C. design is more important than purpose 366. Eureka Forbes uses its own sales force
D. design in unnecessary to reach its prospective customers. Which
type of distribution channel is used by Eu-
361. In a company’s micro environment all of reka Forbes?
the following would be considered EXCEPT
A. Zero-level
A. political forces.
B. One-Level
B. marketing channel firms
C. two-level
C. Publics.
D. three-Level
D. customer markets
362. Gender, age and income are all qualities 367. A financial advisor receives a bonus for
of what segmentation base? selling a certain mutual fund. Her reason
for taking this action, which some consider
A. geographic
unethical, might be that the action
B. psychological
A. Is acceptable in foreign cultures
C. education
B. Is committed by unethical employees
D. demographic
C. benefits the community
363. Mel is about to decide which job to take-
using only the facts. As she compares D. is accepted within the industry
and contrasts information about each job
368. Which stage has the highest investment
opportunity, Mel is showing that she is
cost
aware of which decision-making influence:
A. Input A. Decline
B. Framing B. Growth
C. Logic C. Maturity
D. Style D. Introduction
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 803
369. Which of the following is a true state- B. Customers’ credit limits
ment about inexpensive, convenience, self-
C. Customers’ product preferences
service products;
PRACTICE BOOK» NOT FOR SALE
D. Actual market share
A. Examples of these products are com-
puters and automobiles
374. This refers to the perceived benefits and
B. Their promotional mix should empha- results a customer expects from the prod-
size personal selling. uct or service
C. Sales promotion could promote these A. customer satisfaction
products successfully.
B. customer expectations
D. none of above
C. customer value
370. Which type of internal report would indi- D. customer services
cate to a business that sales for a specific
product have dramatically dropped over 375. This type of Customer Perceived Value
the past three months? refers to any service offered with a prod-
A. Market demographics analysis uct that makes the experience of using the
product enhanced.
B. Accounts payable summery
C. Annual income statement A. Product Benefit
D. Quarterly inventory satus B. Services Benefit
C. Personnel Benefit
371. Responsible for creating ads and making
sure that the ad campaign is finished in the D. Image Benefit This type of Customer
right time frame and budget. Perceived Value refers to any service of-
fered with a product that makes the expe-
A. Marketing Management
rience of using the product enhanced.
B. Promotions
C. Advertising 376. Which steps of the five-step market-
ing process are about understanding cus-
D. none of above tomers, creating customer value, and
building strong customer relationships?
372. Wal-Mart or Target are examples of
what type of business represented in our A. the first two only
society? B. the first three only
A. Service
C. the first four only
B. Global/International
D. the last four only
C. Retail
D. Online 377. Percentage of total sales generated by
competing companies
E. Franchise
A. Market Segementation
373. Which type of marketing data can a busi-
B. Market Share
ness obtain by reviewing its inventory re-
ports and customers’ invoices? C. Target Market
A. Product quality D. Value
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 804
378. who is the father of marketing manage- 383. Brands may be used for creating aware-
ment? ness, this exemplifies what product perfor-
A. charles babbage mance?
B. keller A. rational
B. functional
C. philip kohler
C. critical
D. philip kotler
D. tangible
NARAYAN CHANGDER
379. Marketing is the process of
384. Which of the following is a true state-
A. creating, distributing, promoting, and
ment about marketing-research designs?
pricing products to facilitate satisfying ex-
change relationships with customers A. Designs should not be combined.
B. delivering a standard of living to soci- B. Only descriptive and causal research
ety should be combined.
C. creating, distributing, promoting, and C. Only exploratory and descriptive re-
pricing goods, services and ideas to facil- search should be combined.
itate the achievement of the firm’s objec- D. It is acceptable to use a combination
tives of all three designs.
D. focusing on customers’ needs 385. Which type of organization best suits
a company who has downsized therefore
380. People in this category are looking for
eliminating some management poistions
the highest prices because their motive is
while trying to increase efficiency?
to make the most profit.
A. Effective Management Techniques
A. Seller’s Market
B. Human Resources
B. Buyer’s Market
C. Vertical Organization
C. Government
D. Horizontal Organization
D. Market
386. This helps in identifying the target buy-
381. ‘Sale upto 50%’ is an example of which ers’ needs and wants, as well as their rat-
sales promotion technique? ing of competing products in terms of those
A. Discounts needs and wants.
B. Rebate A. Customer Perceived Value
C. Quantity gift B. Customer Value Analysis
D. None of the above C. Customer Relationship Management
D. Database Marketing
382. is an act of designing a company’s
offering and image to occupy a distinctive 387. What do customers need/want, and how
place in the minds of the target market. can we benefit society?
A. Crafting A. Sales
B. Grafting B. Production
C. Positioning C. Market
D. none of above D. Societal
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 805
388. Who makes the decisions in a Traditional 393. STEP includes
economic system? A. Strengths, Technology, Effectiveness,
PRACTICE BOOK» NOT FOR SALE
A. Government and Price.
B. Consumers B. Strengths, Technical Ability, Energy,
C. Based upon customs, beliefs, religion Power.
and habits C. Socio-Cultural, Technological, Eco-
D. none of above nomic, and Political.
D. Style, Trying, Effort, and Presentation.
389. Which is the main feature of publicity?
A. To increase sales 394. What contains tactical guidelines for the
B. Non Profit Oriented marketing programs and financial alloca-
tions over the planning period?
C. Cost Minimize
A. Selling plan
D. Impersonal Selling effort
B. Marketing plan
390. Which of the following statements best C. Promotional plan
defines the term promotional mix:
D. Product plan
A. The way in which businesses combine
promotional methods 395. Customers often use price to evaluate the
B. The “magic formula” used in develop- of a product or a firm’s
ing promotional plans A. Profits
C. The rotation technique used for pro- B. Advertising
moting employees
C. Value & image
D. The confusion of too many promotional
D. Product & management
techniques
391. Some customers are known for their ex- 396. Rama calls her friend Rita and requests
pertise and involvement in a category and her to sell one of her paintings to Rama’s
are willing to share information and give mother. In this transaction who is the mar-
advice, making them likely to generate keter?
word of mouth. These people are knows A. Rama
as market B. Rita
A. tenders. C. Both
B. mavens. D. none of above
C. sharers.
397. “I do not know which of these my girl-
D. sellers.
friend would like best. I had better come
392. Which of the following is an example of back at another time.” Which kind of cus-
specialty advertising: tomer would make these statements?
A. Skywriting A. Disagreeable
B. A postcard announcing a special sale B. Suspicious
C. Billboards C. Slow or methodical
D. Key rings bearing a company’s name D. Dishonest
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 806
398. Select the factor based on the expla- B. Product or service management
nation:Packaging is important so that it
C. Selling
grabs the customer’s attention and has cor-
rect information on it. D. Promotion
A. Product Line (Depth, Extension & Con-
403. Marketers identify segments best when
traction)
iterating between two approaches. What
B. Branding are the two approaches?
NARAYAN CHANGDER
C. Packaging A. customer, market
D. Product Modification
B. managerial, customer
E. Repositioning
C. managerial, company
399. Which economic utility increased when D. market, company
Bid Ed’s 24-Hour Diner recently began ac-
cepting VISA and Mastercard? 404. Which of the following guidelines should
A. information utility you follow when completing a job applica-
tion form:
B. time utility
C. form utility A. Print the requested information in
black ink
D. possession utility
B. complete the parts labeled for em-
400. Two ways to motivate employees ployer use only.”
A. Human Resources C. Identify the minimum salary level that
B. Rewards and encourage creativity is acceptable
C. Recruiting D. Leave information blank when it does
not apply to you
D. Vertical Organization
401. is an international organization that 405. Why is MM needed?
prepares high school and college students A. because the lecture said so
for careers in finance, hospitality, manage-
ment, and marketing. a. DECA b. FFA c. B. because I want it
Student Government d. Spanish Club C. because it’s important when you’re try-
A. A ing to maintain a market
B. B D. because it isn’t important when you’re
trying to maintain a market
C. C
D. D 406. Which is one reason why an employee
might write a business letter?
402. After the popularity of a product dropped,
the business needed a new product to pro- A. To apply for personal credit
mote that would help to improve its image. B. To accept a social invitation
Which marketing function would come up
with the new product? C. To communicate with friends
A. Channel management D. To sell goods and services
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 807
407. The process through which two or more C. psychological
parties come together to obtain the de- D. physical
sired product or service from someone,
PRACTICE BOOK» NOT FOR SALE
412. One way for salespeople to answer a cus-
A. selling
tomer’s question about the difference be-
B. advertisement tween two items is to explain
C. exchange A. construction and materials
D. marketing B. appearance and style
408. channels consist of company sales- C. unique or novel features
people contacting buyers in the target mar- D. use and durability
ket.
413. Economics is the study of how a nation
A. Advocate uses its resources. The resources, or fac-
B. Social tors of production, in an economy include:
C. Expert A. Money, Factories, Tools, Labor
D. Direct B. Machines and Workers
C. Land, Labor, Capital and Entrepreneur-
409. The employees of a home-improvement ship
warehouse are expert craftspeople who
enjoy giving customers advice about do-it- D. Businesses and consumers
yourself projects. The employees’ advice 414. Name the term which is a part of a
increases the utility of their goods. BRAND which can be spoken
A. Form A. Brand Name
B. Information B. Branding
C. Possession C. trade Mark
D. Place D. Brand Mark
410. Which of the following is NOT one of the 415. Jim’s business is not selling goods as
four philosophies of marketing? well as it did when the business first
opened. Competitors have dropped their
A. Production orientation
prices which has increased demand. What
B. Societal marketing orientation marketing activitity should Jim consider re-
C. Sales orientation visiting to increase his sales?
D. Promotion orientation A. Distribution/Place
B. Pricing
411. It’s not unusual to see a segmentation
study comprised of some usage variable C. Product
(e.g., heavy vs. light users) or some at- D. Promotion
titudinal variable (e.g., positively inclined
416. Magazines and pastries are examples of:
toward our brand vs. loyal to a competi-
tor). What type of variable is it usually A. Convenience products
cross-tabbed with? B. Shopping products
A. demographic C. Speciality products
B. geographic D. Durable products
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 808
417. What type of market likely exists when a B. Marketing concept
local automobile dealer has many cars for C. Selling concept
sale at low prices but demand is low?
D. Societal marketing concept
A. Elastic
B. Buyer’s 423. This P is not a part of the 7Ps of market-
ing mix?
C. Seller’s
A. Promotion
D. Inelastic
B. People
NARAYAN CHANGDER
418. One difference between business ethics C. Process
and the law is that business ethics
D. Purpose
A. are easy to determine
424. Those who make decisions that affect
B. enforced by government
the whole company (CEO, president, COO,
C. must be published CFO, vice president).
D. are often unwritten A. empowerment
419. Measuring brand equity includes includes B. middle management
brand audits, brand tracking, and C. top management
A. Brand Line D. supervisory-level management
B. Brand Mix 425. Brigette works for Rising Bakery Com-
C. brand Extension pany. She manages the bakery’s inven-
D. Brand Valuation tory at 25 supermarkets by refilling stock
and maintaining the stores’ Rising Bakery
420. is the set of all actual and potential displays. What is Brigette?
buyers of a product or services. A. food broker
A. Market B. retailer
B. Exchange and relationship C. jack robber
C. Customer value and satisfaction D. manufacturer’s agent
D. Demands
426. A market is people or organizations that
421. Which is not a stage in the technology life have
cycle A. the ability, willingness, and power to
A. maturity buy
B. Decline B. a medium of exchange and products
they desire
C. Research and development
C. needs and wants and ability and will-
D. Growth ingness to buy
422. is the idea that consumer will not D. unmet needs or wants and products or
buy enough of the company’s products un- services that satisfy those unmet needs or
less the company undertakes large-scale wants
of selling and promotion effort. E. communication, financial and capital
A. Production concept resources
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 809
427. To promote its summer menu, Danielle’s C. good customer data.
Diner plans to e-mail a $5.00-off coupon D. good management.
to its regular customers next Tuesday. The
PRACTICE BOOK» NOT FOR SALE
coupon will be valid from June 1 through 432. Which of the following is NOT an exam-
June 15. What does use of the coupon rep- ple of the public that is part of a company’s
resent? marketing environment?
A. Tactic A. financial
B. Strategy B. media
C. Goal C. citizen action
D. Trend D. marketing department
428. The development of goods and services 433. There are concepts/philosophies of
that best satisfy consumer needs and Marketing
wants is a major goal of
A. 2
A. Financing
B. 4
B. Purchasing
C. 5
C. Product/service management
D. 8
D. marketing information managment
434. A firm has marketing objective for long-
429. discipline that follows a rule infraction periods is to become market leader, The
A. Corrective Discipline price of product to be fix at
B. Rewards and encourage creativity A. Lower
C. preventive discipline B. Higher
D. Effective Management Techniques C. Follow the price of competitors
D. None of these
430. The primary purpose of placing headings
and subheadings in a long business report 435. In marketing process, marketers begins
is to by , and identifying the market needs
A. attract attention to the writer’s hidden and wants.
agenda. A. understanding the environmental fac-
B. organize content in a cohesive, man- tors
ageable way. B. develop market-oriented marketing
C. provide supporting evidence for key strategies
points. C. develop marketing mix
D. solicit an opinion or response from the D. develop relationship with customers
audience.
436. What is an example of an employee rein-
431. An important element of an iterative seg- forcing a service orientation through com-
mentation is munication?
A. a good company. A. Telling customers they are misin-
B. quality products. formed
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 810
B. Offering to find information for cus- 441. Different customers with different needs
tomers require different strategies. This is a de-
C. Agreeing that customers are always scription of
right A. global management.
D. Selecting certain customers to help B. differential marketing management.
C. marketing services management.
437. Informing, reminding or persuading cus-
tomers about a product, the company or a D. target market management.
NARAYAN CHANGDER
social cause that is important to the com- E. variable needs marketing manage-
pany. ment.
A. Promotion
442. The packaging of bread you purchase
B. Marketing Information Systems/Market from a local bakery is an example of:
Research
A. primary packaging
C. Product/Service Management B. Secondary packaging
D. Pricing C. Transportation Packaging
438. One computer tool that a businessperson D. none of above
can use to organize online information for
a research report is 443. Packaging is important not only for pro-
tection of the product but also serves as
A. index cards
A. Quality product
B. mind-mapping programs
B. Complex graphics
C. statistical applications
C. Promotional tool
D. online survey services
D. Promotion budget
439. The process of achieving company goals 444. Jennifer and Linda are going to open a
by effective use of resources through plan- hair/nail salon. They want to inform cus-
ning, organizing, and controlling. tomers of their new business and persuade
A. management them to frequent their facility. Which func-
B. vertical organization tion of marketing will they use?
C. middle management A. Channel Management
B. Marketing-Information Management
D. empowerment
C. Product/Service Management
440. Many hoteliers no longer claim that they
D. Promotion
merely offer lodging. Instead, they now
stake claims as premier travel providers. 445. Account managers, account planners, and
This is done to avoid the mistake of defin- media buyers are all positions in what field
ing their core business of marketing?
A. too confusingly A. Sales
B. too abstractly B. Promotions
C. too strategically C. Advertising
D. too technically D. Brand Management
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 811
446. Which of the following is NOT one of the 451. Human needs shaped by such factors
Four Ps of Marketing? a. Price b. Product as culture, personality, education, society
c. Protection d. Promotion and religion are called
PRACTICE BOOK» NOT FOR SALE
A. A A. Products
B. B B. Needs
C. C C. Wants
D. D D. Essentials
447. Which is not the element of Marketing 452. defines which other brand competes
mix? with and which should thus be the focus of
A. Consumer competitive analysis.
B. Product A. Competitive frame of reference
C. Price B. Brand reference
D. Place C. Seller reference
D. Either a or b
448. During what year/years did the World
Wide Web begin?
453. Name the part of brand which can’t be
A. 1989-1999 spoken but can be recognized.
B. 1930-1950 A. brand mark
C. 1910-1929 B. logo
D. 2000-2010 C. trade mark
449. Which element of marketing mix includes D. brand name
after sales service offered to the cus-
tomers. 454. MIS is a process
A. Product A. Continuous
B. Price B. Management
C. Place C. Ongoing
D. Promotion D. Both 1 & 2
450. Using the cash accounting method, deter- 455. A company’s marketers want to begin
mine the amount of sales that a business marketing research, but they are unfamil-
would record for one day if it makes $2, iar with the nature of the problem. The
300 in cash sales, has COD sales of $450, most appropriate research design for them
and places a $300 special order. would be
A. $2, 300 A. exploratory research
B. $2, 600 B. descriptive research
C. $2, 750 C. causal research
D. $3, 050 D. discovery research
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 812
456. Which type of display would be used to C. experiment
promote the sale of a variety of items such D. hypothesis
as the Buy-one-Get-One free table of prod-
ucts at Publix Supermarkets each week? 461. How does a marketing plan affect the
A. One-Item Display way the marketing team plans its strate-
gies?
B. Line-of-Goods Display
A. The team has more difficulty planning
C. Related Merchandise Display strategies
NARAYAN CHANGDER
D. Assortment Display B. The team can plan strategies more
quickly
457. Which of the following examples is based
on a psychological factor? C. The team can plan strategies with
more precision
A. Sam purchases school clothes for his
son. D. The team can plan strategies up to 10
years in advance
B. Louise purchases furniture for her new
house. 462. The contrast between mass marketing
C. Macie purchases equipment for play- and one-to-one marketing illustrates that
ing soccer. segments become more as they in-
crease in size.
D. Jalen purchases a new automobile
that is good in snow. A. heterogeneous
B. favorable
458. The marketing concept evolved as a re-
C. homogeneous
sult of self regulation of social responsibil-
ities by a business organizations. D. unfavorable
A. Marketing concept 463. Which of the following is not part of indi-
B. Product Concept rect distribution channel
C. Societal marketing concept A. Zero level channel
D. none of these B. One level channel
C. Two level channel
459. ferrari, rolex, swarovski, coach are
types of products that involved in D. Multi level channel
A. Product concept 464. Oldest & rarest goods is-
B. production concept A. Consumable goods
C. selling concept B. Capital goods
D. societal marketing concept C. Non-Conventional goods
D. Short durable goods
460. Marketers may want to use research to
study the economy, a factor that is subject 465. A graphic, mark emblem, symbol or styl-
to change. In this context, the economy ized name used to identify a company, or-
can be described as a(n) ganization, product or brand.
A. variable A. Labelling
B. case study B. Logo
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 813
C. Slogan 470. Letters of inquiry should be as as pos-
sible.
D. none of above
PRACTICE BOOK» NOT FOR SALE
A. specific
466. Four competing philosophies strongly in-
B. vague
fluence the role of marketing activities
within an organization. Which of the fol- C. verbose
lowing is not a marketing management phi- D. demanding
losophy?
A. Societal marketing orientation 471. Scratch a card and win a refrigerator.
Identify the technique of sales promotion.
B. Sales orientation
A. Usable benefit
C. Profitability orientation
B. Product combinations
D. Marketing orientation
C. Instant Draws and assigned gift
467. What is it called? ”The accumulation of D. Lucky Draw
all those individuals and groups who par-
ticipate in the purchasing decision-making 472. THE ART OF ANTICIPATING WHAT BUY-
process, who share some common goals ERS ARE LIKELY TO DO UNDER A GIVEN
and the risks arising from the decision.” SET OF CONDITIONS.
A. All the below A. COMPANY DEMAND
B. Decision center B. EXPERT OPINION
C. Buying center C. PROBABILITY SCALE
D. Buying decision D. FORECASTING
473. Where in the Microsoft Word word-
468. Candace works for a small marketing
processing program should you look to de-
firm that focuses on ads that pop up on so-
termine what page of a document you’re
cial media web pages. Candace most likely
on and how many words are in the docu-
works in
ment?
A. Marketing Research.
A. Status bar
B. Professional Sales. B. Ribbon
C. E-Marketing. C. Quick access toolbar
D. Distribution and Logistics. D. Title bar
469. What term refers to people who are 474. Which of the following is an important
trendy and fashionable in order to impress question for marketers to ask before cre-
others and are often impulse buyers? ating a research design?
A. stretchers A. Who is our target market?
B. aficionados B. What new products do we like?
C. innovators C. What do we want the results to be?
D. strivers D. What is our budget?
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 814
475. What is often the result of positive cus- B. vertical organization
tomer/client relations? C. horizontal organization
A. Additional stress D. supervisory-level management
B. More competition
481. Which market segment represents cus-
C. Repeat business tomers who prefer a variety of reasonably
D. Increased training priced recreational activities?
A. Geographic
476. Coca-Cola is an example of what type of
NARAYAN CHANGDER
business represented in our society? B. Psychographic
A. Service C. Behavioral
B. Global/International D. Occupational
C. Retail 482. A(n) is a gathering of 6 to 10 peo-
D. Online ple carefully selected by researchers based
on certain demographic, psychographic, or
E. Franchise other considerations and brought together
477. Services are more than goods. to discuss various topics of interest at
length.
A. produced and consumed simultane-
ously A. target group
B. perishable B. pilot group
C. inventoried C. focus group
D. inelastic D. customer base
E. ethnographic group
478. Which example will give you quality
data? 483. Select the three main factors to consider
when selecting a form of business owner-
A. A person asks you for clarification
ship?
B. A person misinterpret data
A. How much liability protection do I
C. A person completes a few survey ques- need? How will taxes and the form of busi-
tions ness ownership affect me
D. A person lies about your answers B. Do I need start up capital?
479. Actually marketing means- C. How will taxes and the form of busi-
ness ownership affect me?
A. Exchange
D. How much time will operating a busi-
B. To satisfy the consumer
ness require?
C. Sells
484. William decides to purchase a baseball
D. none of these bat for $50. The opportunity cost of the
480. The type of management that implements decision to purchase the bat is which of the
the decisions of top management, plans following?
how the departments under them can A. $50 cash
work to reach top management’s goals. B. The time spent making the decision on
A. middle management which bat to purchase
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 815
C. Another item William could have pur- B. Trading-Down
chased for $50 C. Product differentiation
PRACTICE BOOK» NOT FOR SALE
D. The time William spent saving for the D. Product simplification
bat.
490. Which is the pattern of segmentation
485. Which task is unique to the Management
wherein the firms view each customer as
and Entrepreneurship career pathway?
a separate segment?
A. advertising products
A. Undifferentiated marketing
B. distributing products
B. Concentrated marketing
C. receiving complaints
C. Customized marketing
D. training workers
D. Differentiated marketing
486. Businesses may prevent burglaries by
checking every room in the building at 491. Which of the following is not one of the
night to make sure that the criteria needed for exchange to take place
A. telephones are tranferred A. A desire and ability to satisfy them
B. public areas are clean B. Communication between parties
C. electrical equipment is turned off C. Free to accept but not reject the
other’s offer
D. windows and doors are locked
D. Something to change
487. “process and activities which meets cus-
tomers’ requirements or needs either by 492. A professional in the pathway collect
satisfying them or by providing value to and analyze many different types of infor-
them in exchange for value to the compa- mation to design new products, to predict
nies.” are definition from future sales and to position their own com-
pany’s strategies against those of its com-
A. management
petitors. a. Professional Sales b. Market-
B. marketing ing and Communications c. Merchandising
C. environment d. Marketing Research
D. communication A. A
B. B
488. Changing old glass bottles into beautiful
new sculptures is an example of util- C. C
ity. D. D
A. Information
493. A social and managerial process by which
B. Form individuals and groups obtain what they
C. Possession need and want through creating and ex-
changing products and value with others.
D. Place
A. Marketing
489. Name the strategy which adds a higher
priced prestigious product to the existing B. Management
line of lower priced products? C. Marketing Management
A. Trading-Up D. All of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 816
494. In which stage of New product devel- B. Deciding Product Strategies
opment Management needs to prepare C. Deciding Pricing Strategies
sales, cost, and profit projections to deter-
mine whether they satisfy company objec- D. All of Above
tives?
499. Which of the following is correct with ref-
A. Idea screening erence to main focus of marketing philoso-
B. Concept development and testing phies?
A. Production concept-Customer needs
NARAYAN CHANGDER
C. Business Analysis
D. Product development B. Product concept-Quantity of products
C. Selling concept-Existing products
495. Which of the following marketing man-
agement orientations focuses primarily on D. Marketing concept-Quality of products
improving efficiencies along the supply 500. Max always uses Tide laundry soap be-
chain? cause he has seen his mother using it ever
A. production concept since. Which factor influences Max’s buy-
ing behavior?
B. product concept
A. Cultural Factors
C. selling concept
B. Social Factors
D. marketing concept
C. Personal Factors
E. societal marketing concept
D. Psychological Factors
496. Marketers study the psychological signif-
icance of pricing because the price 501. ‘Colgate’ is a
A. Leads to value and quality perceptions A. Generic name of a product
to a customer B. Brand name of a product
B. Helps suppliers know how much to C. Brand mark of a product
charge a business for purchasing their
D. none of above
product
C. Gives managers an opportunity to 502. Which of the following refers to sellers
learn things about customers being preoccupied with their own products
and losing sight of underlying consumer
D. Offers customers the ability to pur-
needs?
chase a product
A. satisfaction
497. What is the center of all marketing activ-
B. marketing management
ities?
C. value proposition
A. Math
D. marketing myopia
B. Technological know-how
C. Purchasing 503. Which is the overall reason that mar-
keting strategies are designed and imple-
D. Communication mented?
498. A market survey is required for A. Improving management techniques
A. Deciding Marketing Strategies B. Achieving planned goals
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 817
C. Changing the image of the business D. They must put situation analysis be-
D. Increasing business profits immedi- fore desired target market
PRACTICE BOOK» NOT FOR SALE
ately
509. Salespersons can demonstrate their en-
504. When a company has a chance of losing thusiasm for the products they sell through
money, this is an example of which of the A. tone of voice
following:
B. physical contact
A. Competition
C. customer endorsements
B. Risk
C. Monopoly D. indifferent expressions
D. Productivity 510. POD stands for in the brand positioning.
505. THIS TOOL IS PROPOSED BY MICHAEL A. Point of Direction
PORTER AND IT IS USE FOR IDENTIFY- B. Point of Difference
ING WAYS TO CREATE MORE CUSTOMER
VALUE C. Point of Dimenition
A. VALUE DELIVERY D. None of above
B. VALUE CREATION
511. Which type of promotion is used by
C. VALUE CHAIN companies to stimulate sales by offering
D. VALUE PROPOSITION coupons, giveaways and rebates?
A. Advertising
506. Which of the following is concerned with
the quality performance of product? B. Publicity
A. Product concept C. Sales Promotion
B. Selling concept D. Personal Selling
C. Marketing concept
512. is the task of hiring, training, and
D. Societal marketing concept motivating able employees who want to
507. Selling price helps customers to allocate serve customers.
their money because price determines A. Internal Marketing
A. what customers need to purchase B. Integrated Marketing
B. the value of products to all purchasers C. Performance Marketing
C. what customers can afford to pur- D. Relationship Marketing
chase
D. the quality of all goods and services 513. Setting goals for a project and determin-
ing how to reach them.
508. Which of the following is a true state-
ment about marketing-plan formats? A. organizing
A. They vary from business to business B. controlling
B. They must be double-spaced C. planning
C. They must include charts and graphs D. remedial action
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 818
514. Serving as a volunteer in a specific indus- 519. Finding the money to invest in the busi-
try or for a business-related organization ness and helping customers to find ways
is one way that individuals might obtain to purchase the product.
A. work experience A. Distribution
B. monetary compensation B. Finance
C. technical training C. Product/Service Management
D. guidance counseling D. Selling
NARAYAN CHANGDER
520. Which is a set of tangible and intangible
515. Which of the following is NOT a pathway
attributes designed to satisfy consumer
in the Marketing Career Cluster?
needs?
A. Marketing Research
A. Price
B. Professional Sales
B. Product
C. Merchandising C. Promotion
D. Customer Service D. Place
516. What is the current trend in job growth 521. Identify the factor based on the given
for careers in marketing? explanation.As supply increases, prices
A. They will have a short period of growth should decrease, if demand increases,
and then decline over several years. prices should increase and vice versa
B. They are expected to slow down in the A. Cost & Expenses
next ten years. B. Supply & Demand
C. They have higher than normal growth C. Consumer Perception
for the next several years. D. Competition
D. none of above E. Government
517. This is sometimes called the Data or 522. Which of the following questions best
Knowledge discovery. helps a marketer determine the profitabil-
A. Data marketing ity of a market segment?
B. Data mining A. How many customers are in the seg-
ment?
C. Data warehouse
B. Is a database available to identify po-
D. Customer database tential customers?
518. Which stage of negotiation do many peo- C. Does the segment fit corporate goals?
ple consider the most important part of the
process: D. How frequently do the customers pur-
chase?
A. Preparation
B. Concession 523. Company ABC segments customers by
gender, age, education, and income. Com-
C. Assessment
pany ABC’s segmentation is based on
D. Mediation factors.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 819
A. demographic 528. Samples, coupons, and premiums are ex-
amples of
B. geographic
PRACTICE BOOK» NOT FOR SALE
A. personal selling
C. psychological
B. sales promotions
D. behavioral
C. events and experiences
524. Any paid form of non-personal presenta- D. public relations
tion of ideas, images, goods, or services is
known as Example:radio, TV, newspa- 529. In the Pathway, most careers require
per, web site, or magazine. an advanced degree. a. Marketing Com-
munications b. Merchandising c. Market-
A. sales promotion.
ing Research d. Professional Sales
B. personal selling. A. A
C. publicity B. B
D. advertising C. C
525. As segments increase in size, it becomes D. D
to satisfy them with the same product. 530. . Roy is taking a class on how to use
A. more difficult the new software he just purchased for his
business. The class is offered by the store
B. easier
where he purchased the software. What
C. cheaper aspect of customer service does this situa-
D. more fun tion illustrate?
A. Customer training
526. Which of the following is a psychological
B. Credit/Financing
factor?
C. Order processing
A. attitude
D. Installation
B. education
531. What is a package?
C. age
A. physical wrapper
D. country
B. an informational tag or printed mes-
527. According to the marketing concept, sage
which option shows company commit- C. a psychological aspect of brand names
ment?
D. Part of the UPC code
A. Leaving marketing to the marketing de-
partment 532. An opportunity for an employee and
a manager to obtain valuable feedback
B. Teaching marketing to college market-
when and employee leaves the company.
ing students
A. Corrective Discipline
C. Setting aside funds to research what
customers want B. preventive discipline
D. Pricing a product to maximize prof- C. exit interview
itibilty per unit D. Effective Management Techniques
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 820
533. Which best describes the future growth 538. Why are Universal Product Codes (UPCs)
potential of the Marketing, Sales, and Ser- often preprinted on products before the
vice career cluster? manufacturer ships the products to the
A. Growth is expected to decline. business?
B. Growth is expected to grow less A. to reduce the possibility of theft
quickly than average. B. To increase the product turnover rate
C. Growth is expected to be about aver- C. to simplify the price-marking function
NARAYAN CHANGDER
age.
D. To improve the transportation system
D. Growth is expected to grow much
more quickly than average. 539. During the summer, wildfires swept
through Montana and consumed many
534. A hierarchal up-and-down structure in homes and businesses. Business owners
which tasks and responsibilities of each rebuilt their businesses because they be-
are clearly defined. lieved that the risk involved with wildfires
A. horizontal organization was “just part of doing business in Mon-
tana.” Which type of risk did the business
B. vertical organization owners encounter?
C. resources A. Natural
D. organizing B. Economic
535. Channel Management is also knows as: C. Human
A. Distribution D. Incompetence
B. Private Enterprise 540. Good health limited has decided to launch
C. Profiting a new range of water bottles with in built
D. Tunneling water purifier. Instead of marketing the
product by generic name, the company has
536. Which of the following is the elements of decided to call it’Purifiere’. Identify the
marketing? type of marketing function being described
in the given lines.
A. Needs and Wants
A. Packaging and labelling
B. Creating a Market Offering
B. Branding
C. Customer Value
C. Pricing
D. All of the above
D. Promotion
537. What is a benefit to the salesperson of
building a clientele? 541. Which of external theft listed below
involves stealing money or merchandise
A. Obtaining referrals from loyal cus-
from a store using violence or threats?
tomers
A. Shrinkage
B. Reducing selling costs
C. Supporting the company image B. Employee Theft
D. Securing customer acceptance of C. Shoplifting
higher prices D. Robbery
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 821
542. Molson Breweries has established differ- 547. Some customers are , caring about
ent companies to manage four distinct re- new developments in their category and
gions in Canada. Each region has its own seeking out new products.
PRACTICE BOOK» NOT FOR SALE
marketing and sales staff. This system is A. opinion leaders
called
B. early adopters
A. category management.
C. market mavens
B. local management
D. innovators
C. marketing services.
548. Validity of a search result is:
D. product management.
A. The degree to which the results are ac-
E. regional management. curate.
543. Diana prepares bills and invoices for her B. The degree to which the results dis-
company. Her career is in the area of prove your theory.
A. corporate finance C. The degree to which the results are re-
producible.
B. marketing communications
D. The degree to which the results are in-
C. securities and investments
accurate.
D. professional selling
549. This marketing philosophy focuses on per-
544. What stage is where a business focuses suading and convincing customers to buy
on fighting off competition and sales level the Products.
off A. Production
A. Decline B. Product
B. Maturity C. Selling
C. Growth D. Marketing
D. Introduction 550. Which type of promotion would a com-
pany choose in order to reach a mass au-
545. Marketing benefits our society in all of
dience to inform customers about a new
the following ways EXCEPT.
product?
A. Makes our lives better/easier.
A. Advertising
B. Encourages trade between nations.
B. Publicity
C. Facilitates tax reductions. C. Personal Selling
D. Promotes using the earth’s resources D. Sales Promotion
more wisely.
551. A characteristic of simple memorandums
546. A brand or part of a brand that is given written by business employees is that they
legal protection is called usually are intended to be read by a(n)
A. Brand A. Planning committee
B. Brand Name B. Board of directors
C. Brand Mark C. Internal audience
D. Trade Mark D. Group of suppliers
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 822
552. Sports events and press conferences are 557. THE FIRST STEP IN THE BUSINESS UNIT
part of:(a) sales promotion (b) advertising STRATEGIC PLANNING PROCESS IS
(c) public relations (d) personal selling A. FEEDBACK AND CONTROL
A. Sales Promotion B. GOAL FORMULATION
B. Publicity C. BUSINESS MISSION
C. advertising D. IMPLEMENTATION
D. Public relations 558. Marketer is a person who takes part
NARAYAN CHANGDER
in the process of exchange.
553. In a regional marketing management sys-
tem, play(s) a key role. A. ACTIVE
A. consensus decision making B. PASSIVE
C. BOTH
B. geographics
D. NONE
C. demographics
D. psychographics 559. Which of the following is NOT a reason
for importance of marketing information?
E. operational functions
A. It identifies market opportunities
554. Which of the following is not related with B. It solves marketing problems
marketing mix? C. Monitors performance
A. Product D. It persuades, reminds or informs cus-
B. Price tomers about a product
C. Place 560. Services are said to be more than
goods.
D. Consumer
A. durable
555. The following are the factors which com- B. tangible
prise the microenvironment EXCEPT:
C. inseparable
A. publics
D. variable
B. culture
561. Which is the most important component
C. suppliers of an effective business letter?
D. marketing intermediaries A. Opening
556. Which marketing function provides infor- B. Message
mation to consumers will assist them in C. Address
making a decision to purchase a good or
D. Heading
service?
A. Pricing 562. ‘Ambi Pur’, ‘Duracell’, ‘Pantene’ etc. are
different brands of products manufactured
B. Promotion by:
C. Production A. Hindustan Unilever Ltd
D. Distribution B. Tata
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 823
C. Procter and Gamble 568. A market segment is a:
D. Godrej Consumer Products Ltd. A. complete customer population at a
PRACTICE BOOK» NOT FOR SALE
563. Which two statements are a purpose of marketplace.
market research B. group of industrial customers with
A. to promote goods and services variable wants and needs
B. to understand the needs of the cus- C. customer group who share similar in-
tomers clinations toward a brand.
C. to identify competitors D. homogenous customer group broken
D. to identify market trends down into groups that are heterogeneous.
564. Which of the following restaurant assets 569. Karam limited is offering a travel pack-
would be considered intangible: age for 15 destinations worldwide with
A. The waiter’s uniforms a free insurance on the bookings for the
B. An expensive oven month of December, 2019. Identify the
feature of marketing being described in the
C. The building
above lines.
D. A secret recipe
A. Needs and wants
565. Which of the following jobs does NOT
B. Creating a market offering
require at least a bachelor’s degree? a.
Customer Service Representative b. Pub- C. Customer value
lic Relations Specialist c. Brand Manager
d. Marketing Research Analyst D. Exchange mechanism
A. A 570. When Apple decides to improve features
B. B of the iPhone by developing a newer, more
C. C up-to date version, they have conducted
the marketing function known as
D. D
A. Product management
566. Which of the following is most related to
the marketing concept? B. Service management
A. Make a profit C. Product/Service management
B. Satisfy customers D. None of the above
C. Gain market share
D. Increase sales 571. What is one of the benefits of sending a
job interview follow-up letter?
567. Which of the following pairs of busi-
nesses are examples of indirect competi- A. Reminds the interviewer of the appli-
tors: catant
A. Wendy’s and Kentucky Fried Chicken B. Lets the applicant submit test scores
B. Pizza Hut and Wendy’s C. Allows the applicant t inclue a resume
C. JC Penney and Pizza Hut D. Provides the interviewer with refer-
D. Kentucky Fried Chicken and Pizza Hut ences
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 824
572. The famous VW commercial with its 577. Filipe is a chef at a restaurant. He al-
famed the tag line “Drivers Wanted” is an ways starts with his resources, such as
example of raw vegetables and meats, and then turns
A. direct marketing. them into a fully-cooked meal. When Filipe
turns his ingredients into a complete meal,
B. transformational appeal. he’s taking part in
C. interactive marketing. A. mass production
D. informational appeal. B. dispatching
NARAYAN CHANGDER
573. One advantage of labor specialization by C. the conversion process
job task is that workers’ D. resource transformation
A. pride in the finished product increases
578. Which of the following products consume
B. morale improves maximum time and effort to purchase-
C. dependency increases A. Convenience
D. tranfers in the industry are easier B. Shopping
574. Which of the following is NOT a possi- C. Specialty
ble duty for a professional working in the D. All the above
Marketing Research pathway?
579. A business wants to send a mailing to all
A. Analyze information to design new
customers who have ordered at least $2,
products
500 in merchandise in the past year. To ob-
B. Predict future sales tain the appropriate list of customers, the
C. Illustrate catalogs in order to inform business should set the query by
customers A. credit rating and location
D. Position a company’s strategies B. last name and account number
against those of its competitors
C. product code and zip code
575. “The purchaser purchases the goods D. sales dollars and dates
which are chief and accessable at
everywhere”-Which idea gives about mar- 580. Which of the following is not a part of
keting? Technological Environment?
A. Production oriented A. Government Legislations
B. Society Oriented B. Improvement in Harvesting Tech-
niques
C. Consumer Oriented
C. Change in technology
D. Sells Oriented
D. Change in Consumption Pattern
576. This is not an element of marketing mix:
581. describe how consumer make pur-
A. Product chase decision and how they use and dis-
B. Price pose of the purchased goods or services.
C. Advertising A. psychographics
D. Place B. consumer behavior
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 825
C. marketing wants, and interests. What marketing
D. consumerism function is this known as:
PRACTICE BOOK» NOT FOR SALE
A. Channel Marketing
582. . Identify the type of appeal used in the
following persuasive message:“This new B. Marketing-Information Management
book is written by Dr. Juliet Browne, who C. Product/Service Management
holds a doctorate from the Harvard School D. Promotion
of Medicine and is the Chair of the World
Health Organization.” 587. Which of the following is part of Socio-
A. Emotions Cultural Environment?
B. Reason A. Land Ownership
C. Credibility B. Social Class
D. Shock value C. Gender Ratio
D. Change in Marketing Strategies
583. action taken prior to an infraction to en-
courage employees to follow standards 588. You are directed to study the demo-
and rules graphic, economic, natural, technological,
political, and cultural factors that are
A. Effective Management Techniques
larger societal forces affecting your com-
B. preventive discipline pany. What are you studying?
C. Corrective Discipline A. the macroenvironment
D. Rewards and encourage creativity B. the marketing mix
584. The assumes that people are resis- C. the microenvironment
tant to buying product that are not abso- D. the global environment
lutely necessary
589. SHOPPEE AND LAZADA SECURE PART-
A. marketing orientation
NERSHIP WITH DIFFERENT COURIER COM-
B. sales orientation PANIES LIKE J & T AND NINJA VAN. THIS
C. customer orientation IS AN EXAMPLE OF WHAT FORM OF MAR-
KETING ALLIANCES?
D. production orientation
A. PROMOTIONAL ALLIANCES
585. Which of the following in an example of B. LOGISTICS ALLIANCES
internal secondary data?
C. PRODUCT/SERVICE ALLIANCES
A. previous financial statements
D. PRICING COLLABORATIONS
B. government statistics
C. a market research resort for an 590. Who owns a good if the good is used in
agency performing a service for a customer?
D. a press release by a competitor A. The business performing the service
B. The customer who buys the service
586. The manager of a local restaurant asks all
wait staff to hand out customer satisfac- C. The producer of the good
tion questionnaires to their customers to D. The supplier of the good to the busi-
gather data about customer loyalty, needs, ness
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 826
591. This refers to strategies intended to es- 596. A primary advantage to businesses that
tablish and sustain desirable customer re- use groupware computer applications is
lationships. that they can
A. relationship marketing A. boost liability
B. customer satisfaction B. increase efficiency
C. customer relationship management C. decrease output
D. customer service management D. reduce competition
NARAYAN CHANGDER
592. Marketing communications can contribute 597. Internal capabilities of the company
to brand equity by establishing the brand A. Sales
in memory and a brand image.
B. Production
A. creating
C. Market
B. building
D. Societal
C. communicating
D. introducing 598. A business determines that it can in-
crease its market share 12 percent by pro-
593. Entrepreneurs may need to approximate moting its goods and services to Hispanic
Prizm and VALS data, because they are females who are 18-34 years old. How is
A. not available to the public. the business segmenting the market?
B. difficult to understand. A. By geographics
C. expensive. B. By psychographics
D. not interesting to consumers. C. By demographics
D. By behavior
594. Raising the price of the hot new Christ-
mas toys because of predicted increase de- 599. Sales Promotion converts future con-
mand is an example of which marketing sumer into consumer.
function? A. Permanent
A. marketing information management B. Temporary
B. pricing C. Conservative
C. promotion D. Free
D. distribution
600. The consists of the actors and forces
595. Inelastic demand, Multiple sales calls, de- outside marketing that have an effect
rived and fluctuating demand, geographi- on marketing management’s ability to de-
cally concentrated buyers and direct pur- velop and maintain palmy relationships
chasing are the feature of with its target customer.
A. Business maketers A. marketing system
B. formal marketer B. marketing network
C. professional market C. marketing environment
D. none of the above D. None of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 827
601. Marketing Information Management a $200 bonus. What technique is Eric us-
(MIM) helps with: ing to motivate staff members to continue
the good work?
PRACTICE BOOK» NOT FOR SALE
A. planning and organizing
B. promotion A. Financial incentive
C. coordinating and controlling B. Verbal encouragement
D. making decisions C. Acknowledge plaque
E. only A, C, D D. Public recognition
602. Which of the following is an example of 607. Which two pathways most involve being
an integrated software application: able to handle rejection?
A. URL A. Buying and Merchandising, and Distri-
bution and Logistics
B. Java
B. Professional Sales and Marketing, and
C. SMS
Buying and Merchandising
D. Point-of-Sale
C. Distribution and Logistics, and Market-
603. Which among the following is not an ele- ing Communications and Promotions
ment of marketing mix- D. Professional Sales and Marketing, and
A. Product Marketing Communications and Promo-
tions
B. Price
C. Place 608. Who among the following has pro-
D. Advertising pounded the classification of 4P’s of mar-
keting?
604. stands for- A. James Culliton
A. Protection, Preference, Price, Place B. N.H.Borden
B. Product, Port, Place, Price C. Robert Lauterborn
C. Product, Price, Place, Promotion D. E.J.McCarthy
D. Product, price, Place, Package
609. Many people want a Mercedes, only a
605. ‘’ the purpose of marketing is to gener- few are able to buy. This is an example
ate customer value at profit”Which mar- of .
keting management philosophy is high-
A. Need
lighted in this statement?
B. Want
A. The Marketingconcept
C. Demand
B. The production concept
D. Status
C. The selling concept
D. none of above 610. All things used in producing goods or ser-
vices; a source of aid or support that may
606. Eric sends staff members an email stat- be drawn upon when needed.
ing that their department’s performance
during the third quarter exceeded the com- A. organizing
pany’s goals, so each of them will receive B. exit interview
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 828
C. resources 615. Which one of the following is a “Generic”
name of product?
D. controlling
A. MRF Tyre
611. Which concept of marketing emphasis B. Close-up Toothpaste
on availability and affordability of the
C. Wristwatch
product-
D. Canon Camera
A. selling
616. The promotion of products or brands
NARAYAN CHANGDER
B. production
through one or more forms of electronic
C. product media correctly defines which of the fol-
D. marketing lowing?
A. Infomercials
612. It is when a customer develops a com- B. Internet marketing
mitment to a brand and becomes a repeat
buyer-sometimes for life. C. Digital marketing
D. Telecommunication Marketing
A. Brand Value
B. Brand Marketing 617. Large companies normally manage quite
different businesses, each requiring its
C. Brand Loyalty own strategy known as
D. Brand Performance A. SBU
B. GE Matrix
613. You were just hired at PetSmart to be a
cashier. Your job includes running the cash C. BCG Matrix
register and assisting customers with their D. Ansoff’s Matrix
needs. This job is an example of the
marketing function. 618. Services are simultaneously produced
and consumed. This is different from
A. Financing goods because goods can be
B. Selling A. produced and consumed simultane-
C. Pricing ously
B. perishable
D. Distributing
C. inventoried
614. Given the formula for stock turnover as D. inelastic
Net Sales / Average inventory. Use alge-
bra to solve the following problem:What 619. How can the salesperson try to reduce
was the average inventory if the stock the number of customer complaints about
turnover rate is 5 and the net sales were the products customers buy?
$76, 850? A. By using high-pressure selling tech-
A. 15370 niques
B. 14370 B. By identifying the customer’s real
needs
C. 13370
C. By approaching customers as soon as
D. 16370 possible
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 829
D. By advising the customer from per- B. Must be paid for
sonal experience
C. Receives close attention from all cus-
PRACTICE BOOK» NOT FOR SALE
620. Primary research is: tomers in the target market.
A. collected for the first time by the re- D. Presents the same message to all
searcher members if the target market
B. obtained from an Internet search 625. is an organized set of procedures and
C. obtained from a govenment source routine.
D. collected by visiting a library A. Marketing information
621. The external environment B. Marketing Management
A. cannot be influence and control by mar- C. Marketing information system (MIS)
keting managers D. None
B. does not change overtime
626. Which of the following items might be in-
C. can be controlled in much the same
cluded in a marketing plan’s appendix?
manner as the internal marketing mix
D. must be continually monitored by mar- A. A list of marketing objectives
keting managers B. A product photograph
622. When companies change their product de- C. The organization’s mission statement
sign, formulation, or brand image, so as D. A SWOT analysis chart
to alter the product’s competitive position,
the same is referred to as: 627. is a key ingredient in the philosophy
A. Positioning by Corporate identity of marketing; it occurs when people give
up something in order to receive some-
B. Positioning by product category
thing that they would rather have.
C. Positioning by competitor
A. Leveraging
D. Repositioning
B. Transformation
623. Under what circumstances would it be ap- C. Exchange
propriate for a person to send a letter of
application to a business? D. Synergy
A. When acting on a referral job lead 628. Alma is preparing a presentation about
B. When completing an application form her department’s budget to make to the
C. When submitting educational tran- company president. She wants to use a
scripts visual representation of the budget that
shows parts in relation to the whole. Alma
D. When responding to a request for in- should consider using a
formation
A. bar graph
624. Which of the following characteristics is
B. table
shared by advertising and publicity:
C. line graph
A. Is impersonal since there is no interac-
tion with the customer D. pie chart
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 830
629. It refers to amount of money, which a 634. MONITORING CULTURAL VALUES AND
customer has to pay to buy a product. SUBCULTURES ARE INCLUDED IN WHAT
A. Product ENVIRONMENTAL FACTOR?
B. Package A. TECHNOLOGICAL ENVIRONMENT
C. Label B. SOCIO-CULTURAL ENVIRONMENT
D. Price C. ECONOMIC ENVIRONMENT
D. NATURAL ENVIRONMENT
NARAYAN CHANGDER
630. Which of the following is NOT a purpose
of sales promotions? 635. The consists of the actors and forces
A. To entice people in. outside marketingthat affect marketing
management’s ability to develop and main-
B. To boost sales figures.
tain successfulrelationships with its target
C. To attract first-time buyers customers.
D. To clear new stock. A. marketing organization
631. Which workplaces are typical for some- B. marketing system
one working in Marketing, Sales, and Ser- C. marketing network
vice? Select all that apply.
D. marketing environment
A. factories
B. offices 636. Many companies give a return of part of
the purchase price as an incentive for cus-
C. customer’s homes tomers to purchase their product is called
D. home offices a:
A. premium
632. Many businesses are using the technol-
ogy developed by the space program to B. rebates
create C. samples
A. Advanced new products
D. sweepstakes
B. marketing strategies
637. Field of consumer oriented theory is
C. updated brand names
applicable-
D. advertising techniques
A. Factory
633. Which of the subsequent BEST describes B. Society
the environment that contains the larger
social group forces that have an ef- C. market
fect on the company-level environment- D. none of these
demographic, economic, natural, techno-
logical, political, and cultural forces? 638. What can we make or do best?
A. global environment A. Sales
B. macro environment B. Production
C. micro environment C. Marketing
D. None of these D. Societal
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 831
639. Theft, human error, technological errors, B. The World Wide Web contains images
and damages are all a cause of and text.
PRACTICE BOOK» NOT FOR SALE
A. Surplus C. The World Wide Web only contains
B. Shortage text.
C. Shrinkage D. The Internet came after the World
Wide Web.
D. Stock Turnover
640. Holistic marketing does not include: 645. Which career is best described by some-
one who buys materials, products, and ser-
A. Relationship marketing vices for an organization?
B. Integrated marketing
A. Wholesale Buyer
C. Internal marketing
B. Marking Clerk
D. Digital marketing
C. Purchasing Agent
E. Social responsibility marketing
D. Stock Clerk
641. Promotion refers to
A. Use of various gadgets to move for- 646. Who is the father of marketing?
ward A. Stephen John
B. Use of communication to inform the po- B. Philip Kenes
tential customers about the product
C. Philip Kotler
C. Customers use various tools to know
about the product D. Philips Kohler
D. Any reward given to producers E. Philip Kotler
642. The final step in the marketing process is 647. Product Differentiation:Product Features,
Service Differentiation:
A. creating customer loyalty A. Product form
B. capturing value from customers B. Style
C. creating customer lifetime value C. Customization
D. understanding the marketplace
D. Installation
643. What is advertisement try to do?
648. Which of the following careers in the Mar-
A. to buy a product keting Career Cluster requires a Master’s
B. to sell a product. degree? a. Chief Executive Officer b. Real
Estate Sales Agent c. Copywriter d. Ship-
C. to make a product
ping and Receiving Clerk
D. to survey a product
A. A
644. What is the difference between the Inter-
B. B
net and the World Wide Web?
C. C
A. The World Wide Web is the same as
the Internet. D. D
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 832
649. “Marketing management as the art and 653. Marketing is the process
science of choosing target markets and A. of selling
getting, keeping and growing customers
through creating, delivering and communi- B. of production
cating superior customer values of man- C. of buying and selling
agement.” Define by
D. where goods are bought and sold in
A. Harold Koontz such a way that maximizes the satisfac-
B. Kreitner tion of consumer needs
NARAYAN CHANGDER
C. Philip Kotler 654. Select the explanation for merchandising-
D. Robert L. Trewelly related discounts, Reduction in price as a
result of buying in larger quantities
650. Select the technique and example used in
A. Cash discounts
pricing products.Technique:Setting higher
than average prices to send a message to B. Quantity discounts
customers that the product has a status C. Trade discounts
and is prestigious. Example:Sneakers of
a particular brand that cost $180 D. Seasonal discounts
A. Odd-Even Pricing 655. The business manager tried to write a
B. Prestige Pricing promotional letter that was simple, clear,
and interesting so that customers who re-
C. Multiple Unit Pricing ceived it would
D. Bundle Pricing A. need to read it many times
651. Which of the following often makes it B. easily understand it
necessary for workers to continue their ed- C. find it entertaining
ucation and obtain training to pursue dif-
ferent careers: D. ask what it really meant
A. Advances in technology 656. This function is about one word COM-
B. Increases in responsibility MUNICATION . This function is how a cus-
tomer discovers a product.
C. Changes in geography
A. Promotion
D. Limits to confidentiality
B. Product Service Management
652. The following statement appeared in an
C. Marketing Planning
online journal article written by Dr. Lydia
Garrett:“Dr. Sanderson has limited exper- D. Selling
tise in the area of biophysics, and I do not E. Channel Management
believe that he has conducted enough re-
search to support his theory.” This is an 657. Added value of a product in economic
example of: terms
A. an opinion A. Utilities
B. supporting evidence B. Functions
C. hearsay C. Goods
D. a fact D. Value
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 833
658. Employees can demonstrate their 663. Which one of the following factors is not
customer-service mindset by using good relevant to price fixation?
PRACTICE BOOK» NOT FOR SALE
A. business activities A. Obtaining market leadership
B. promotional plans B. Age of an organisation
C. telephone techniques C. Value for money
D. marketing strategies D. Product differentiation
664. Obtaining, developing, and improving a
659. Who is the Father of Modern Market-
product
ing?
A. Selling
A. Abraham Maslow
B. Product/Service Management
B. Lester Wunderman
C. Marketing
C. Peter Drucker
D. Distribution
D. Philip Kotler
665. Marketers often conduct causal research
660. Identify the factor based on the given through experiments and
explanation.As competition increases, the
A. informal discussions
price will decrease and vice versa
B. questionnaires
A. Cost & Expenses
C. simulations
B. Supply & Demand
D. literature reviews
C. Consumer Perception
D. Competition 666. Microenvironment factors from the public
perspectives includes all below except
E. Government
A. Financial publics
661. Booking hotel rooms for vacationers is an B. environmental group
example of which marketing?
C. Market publics
A. Feature
D. Banks
B. Service E. Law and regulations
C. Benefit
667. refers to the process through which
D. Sports two or more parties come together to ob-
tain the desired product or service from
662. Buying insurance for a business in case of someone, offering the same by giving
theft or fire is which of the following ways something in return. It is referred to as
to manage risk? the essence of marketing.
A. Avoid A. Exchange
B. Shift B. Research
C. Retain C. Selling
D. Reduce D. Advertising
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 834
668. Publicity refers to- 673. When is a pull strategy appropriate?
A. Non paid form of impersonal communi- A. when consumers are able to perceive
cation differences between brands
B. Paid form of impersonal communica- B. when brand choice is made in the store
tion C. when the product is an impulse item
C. Non paid form of personal communica- D. when there is low brand loyalty
tion
674. What are the brand element choice crite-
NARAYAN CHANGDER
D. Paid form of personal communication ria? Select all that applies.
669. This is a concept that holds that con- A. Memorable
sumers will not buy enough of the orga- B. meaningful
nization’s products unless it undertakes a
large-scale selling and promotion effort. C. likable
D. Transferable and Adaptable
A. Product concept
E. Protectable
B. Marketing concept
C. Production concept 675. What four activities are involved in dis-
tribution?
D. Selling concept
A. Physical distribution
670. means that all customers are treated B. Purchasing
the same.
C. Inventory storage
A. One-to-one marketing
D. Inventory control
B. Gender marketing
E. Demographics
C. Group marketing
676. Marketing Management is the of
D. Mass marketing choosing target markets and getting, keep-
671. Who makes the decisions in a Command ing and growing customers through creat-
economic system? ing, delivering and communicating superior
customer value.
A. Government
A. Science
B. Consumers
B. Art
C. Based upon customs, beliefs, religion C. Science and Art
and habits
D. None of the Above
D. none of above
677. A(n) segment is always a tempting
672. In an economic system, which of the fol- one for marketers to target because mar-
lowing is the decision to purchase raw ma- keters assume that those customers can
terials and make it into an item to sell? afford to purchase their goods or services.
A. What to produce? A. international
B. For whom to produce? B. upscale
C. How to produce? C. small
D. When to produce? D. large
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 835
678. A business with poor ethics is likely to A. Financing
A. avoid fines B. Risk bearing
PRACTICE BOOK» NOT FOR SALE
B. reduce it financial risks C. Packaging
C. beat the competition D. Standardization
D. lose customers 684. Which one of the following is the key
679. As an audience member, which of the to build lasting relationship with con-
following should you do to encourage a sumers?
speaker during an oral presentation? A. price of the product
A. Smile B. need recognition
B. Refrain from asking questions C. customer satisfaction
C. Keep a straight face to communicate D. quality of the product
that you are serious
685. A technique for maximizing the value
D. Quietly discuss the speech with the gained by both you and the costumer from
person sitting next to you each transaction.
680. In a company’s macro environment all of A. Value Proposition
the following would be considered to be a B. Value Delivery System
part EXCEPT
C. Up-Sell
A. demographic forces.
D. Cross-Sell
B. technological forces.
C. natural forces. 686. If the producer sells goods through its
shops then it is called-
D. marketing channel forces
A. Direct sales
681. s of Marketing mix does not have B. one way channel of distribution
A. Price C. Goods sold through its own shop
B. Product D. none of these
C. Process
687. The process of planning, improving,
D. Progress and/or adding to a firm’s product line.
682. Name the element of product mix which A. Promotion
acts as a silent salesmen as it induces cus- B. Marketing Information Systems/Market
tomers to buy the product. Research
A. packaging C. Product/Service Management
B. branding D. Selling
C. labeling
688. The function of marketing where the indi-
D. none of the above vidual completes the exchange transaction,
683. From among the following, identify the provides services for customers and deter-
factor which does not form part of facili- mines client needs and wants is:
tating function of marketing? A. Channel Management
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 836
B. Marketing-Information Management B. 1, 3, 4, 2, 5
C. Product/Service Management C. 1, 2, 3, 4, 5
D. Selling D. 1, 3, 2, 5, 4
689. The channel facilitates the direct link be- 694. What is a key to effective note-taking?
tween the manufacturer and the customer:
A. Creative thinking
A. Zero level channel
B. Capturing details
NARAYAN CHANGDER
B. One level channel
C. Active listening
C. Two level channel
D. Using an outline
D. Multi level channel
695. characteristics such as age, gender, eth-
690. Which of the following is a brand name? nic background, income are:
A. All of these A. demographics
B. Asian Paints B. psychographics
C. Nike C. geographics
D. Woodland
D. behavior analysis
691. SAN MIGUEL CORPORATION ESTABLISH
696. According to the pyramid of corporate so-
B-MEG TO SUPPLY FEEDS TO THEIR
cial responsibility, the foundation of such
FARMS. THIS IS AN EXAMPLE OF WHAT
social responsibility of a firm comes from
STRATEGY?
A. economic responsibilities.
A. INTERNAL EXPANSION
B. legal responsibilities.
B. MERGER
C. BACKWARD INTEGRATION C. ethical responsibilities.
D. FORWARD INTEGRATION D. philanthropic responsibilities.
692. In which stage of New product develop- 697. What company launched its instant mes-
ment it is decided whether the product senger chat service with the greeting,
idea compatible with company objectives, “You’ve got mail”?
strategies, and resources? A. Microsoft
A. Idea screening B. Apple
B. Concept development and testing C. AOL
C. Idea generation D. Bing
D. Product development
698. A company charging fairly low prices for
693. Make the correct sequence of marketing high-quality goods is practising pric-
functions from the following:(1) Gathering ing.
& Analysing market information (2) Prod- A. competitive
uct designing & development (3) Market-
ing planning (4) Packaging & Lebelling (5) B. value
Standardisation & Grading C. perceived-value
A. 1, 3, 2, 4, 5 D. quality
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 837
699. When Angela checked out of her hotel, well. Which employer would be best for
she completed a research form rating the Lola to work for?
hotel’s service, food, and accommodations.
PRACTICE BOOK» NOT FOR SALE
A. the government
This is an example of what marketing core
function? B. herself
A. product planning C. a private company
B. marketing information management D. an organization
C. information utility 704. T-shirts sold at music concerts that are
D. marketing mix imprinted with a rock group’s name are ex-
amples of products that have utility.
700. . The salesperson can check his/her un-
A. service
derstanding of what the customer has said
by asking questions. B. form
A. interpretive C. price
B. personal D. intangible
C. open-ended 705. The Good Ol’ Barbecue Sauce Company
D. numerous began marketing a new sauce that includes
spices often found in Asian cuisine. How is
701. In which testing thirty to 40 qualified the company segmenting its market?
shoppers are asked about brand familiar-
A. product benefits
ity and preferences in a specific product
category and attend a brief screening of B. demographics
both well-known and new TV or print
C. psychographics
ads?
D. geographics
A. Controlled Test Marketing
B. Test Markets 706. A television commercial stresses the ben-
efits of buying a new protein bar.
C. Simulated Test Marketing
A. Marketing Information Management
D. Sales-Wave Research
B. Product Service Management
702. What does a miniature golf business pro-
C. Pricing
vide to its customers?
D. Promotion
A. a promotion
B. an exchange 707. Which survey question isn’t collecting
qualitative data?
C. a good
A. Do you like chocolate or vanilla?
D. a service
B. Why should the voting age change to
703. Lola is a very creative and driven person. 16 years old?
She is able to meet goals that she sets for
C. What kind of toppings do you like on
herself and works very hard. Lola also
your pizza?
likes making her own schedule and does
not take direction or constructive criticism D. How should you discipline a child?
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 838
708. Geoffrey B. Small B. Marketing Degree
A. Production C. A Communications Degree
B. Sales D. All of the above
C. Market
713. Basically marketing management make
D. Societal
popular by-
709. Choose the concept for the following A. E. Jerron Mcarthy
NARAYAN CHANGDER
definition:The internal environment is con-
formed by departments or areas such as B. Philip Kotlear
finance, human resources, accounting, pur- C. Neil Borden
chasing, and the top management, which
share the responsibility for understand- D. Theodore Leveit
ing customer needs and creating customer
value. 714. In addition to his name, address, and
phone number, what information should
A. The Company
Dwight include in his corporate email sig-
B. The Suppliers nature?
C. The Customers A. His position, company, and references
D. The Competitors B. His work history, company, and email
710. Brad wants to find a job in the field of address
advertising. An easy way for Brad to find C. His position, work history, and email
out the names of all the advertising busi- address
nesses in his area would be to
D. His position, company, and email ad-
A. visit local businesses dress
B. read the yellow pages
C. ask his friends 715. A Web crawler is:
D. watch for advertising A. An insect that eats the wires on your
computer
711. New Zealand promotes private own-
B. An internet bot that browses the web
ership of businesses where competition
to find and file information
among business owners drives prices.
They are considered to be closer to which C. Researcher who creates surveys on-
type of economic system? line
A. Command D. A virus on your computer
B. Market
716. What does the owner of a miniature gold
C. Tradionalist
business provide her customers with?
D. Mixed
A. a service
712. Which bachelor’s degrees are desired for B. a promotion
someone looking for a career in market-
ing? C. a good
A. Business Degree D. an exchange
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 839
717. ‘’ the basic role of a firm is to identify 722. Why is it important for businesses to fol-
a need and fill it”The marketing manage- low local health ordinances?
ment philosophy highlighted in the given A. To prevent accidents in the workpl
PRACTICE BOOK» NOT FOR SALE
statement is:
B. To reduce the risk of widespread ill-
A. The production concept ness
B. The product concept C. To protect the natural environment
C. The marketing concept D. To lower the need for medical care fa-
D. none of above cilities
718. Looks at the needs for certain products, 723. The management function of business is
and then coordinate all the stages of its usually responsible for
development. A. setting policy
A. Product Development B. serving customers
B. E Marketing C. preparing ads
C. Promotion D. stocking shelves
D. none of above 724. four stages in life of a product
719. This function is important for understand- A. Product Life Cycle
ing the available opportunities and threats B. Technology Adoption Life Cycle
as well as strengths and weaknesses of
C. Dawg house life cycle
the organisation and help in deciding what
opportunities can best be pursued by it. D. ramen life cycle
A. Marketing Planning 725. It act as a silent salesman as it promotes
B. Product Designing and Development the product and increases its sale.
C. Customer Support Services A. Labelling
D. Gathering and Analysing Market Infor- B. Branding
mation C. Trade Mark
720. Honest goal setting usually helps you to D. Packaging
your priorities 726. Which of the following is the basic pur-
A. confuse pose of a company’s promotional mix:
B. clarify A. To provide all product informatoin
C. conceal B. To influence consumers to purchase
D. complicate C. To list the company’s products
D. To reduce competitor’s sales
721. Which tool of promotion mix involves
direct face to face conversation with 727. Which one is not an element of marketing
prospective customer? mix?
A. Sales promotion A. Product
B. Personal selling B. Protection of consumer
C. Advertisement C. Promotion
D. Publicity D. Place
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 840
728. is characterized by low involvement, 733. Consists of individuals and households
a short time frame, an internal-only infor- that buy goods and services for personal
mation search, and low costs. consumption.
A. Limited decision making A. International Markets
B. Routine response behavior B. Government Markets
C. Emotional buying C. Business Markets
D. Consumer Markets
D. Intensive decision making
NARAYAN CHANGDER
734. Payroll, hotel reservations, and sales or-
729. What type of display is used when Wal- ders are handled by a(n) type of infor-
Mart displays all of its digital clocks that mation system.
are made by a variety of manufacturers?
A. executive support system
A. One-Item Display
B. knowledge work system
B. Line-of-Goods Display
C. decision support system
C. Related Merchandise Display D. transaction processing system
D. Assortment Display
735. consists of schools, hospitals, nursing
730. Marketing is a process which aims at homes, prisons and other institutions that
must provide goods and services to people
A. Production in their care.
B. Profit-making. A. Open market
C. The satisfaction of customer needs B. Consumer market
D. Selling products C. Institutional market
D. Government market
731. Needs of are being focused in Mar-
keting.answer choices 736. THIS LEVEL OF ORGANIZATION IS RE-
A. Customer SPONSIBLE FOR DESIGNING THE STRATE-
GIC PLAN TO GUIDE THE WHOLE ORGANI-
B. Marketer ZATION
C. Consumer A. PRODUCT LEVEL
D. Seller B. DIVISION LEVEL
C. BUSINESS UNIT
732. A home-improvement company has de-
termined that many of its potential cus- D. CORPORATE LEVEL
tomers will only purchase carpeting from
737. A 30-40 customers are selected and are
businesses offering a discount. What has
invited to the store where they can buy
the company determined?
anything.
A. Customer buying behavior A. Product testing
B. Customer shopping types B. Controlled testing
C. Customer browsing methods C. Simulation testing
D. Customer selling ability D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 841
738. Which of the following is an example of 743. Which element of marketing mix is re-
corporate responsibility: sponsible for making the goods available
from the manufacturer to consumers?
PRACTICE BOOK» NOT FOR SALE
A. A company hires minority employees.
B. A company expands its facilities A. Product mix
C. A company uses recycled materials in B. Price mix
its products. C. Place Mix
D. A company pays its taxes on time. D. Promotion Mix
739. What characteristic of useful marketing 744. Which of the following means selecting
information requires the information to be and safely using technological resources to
closely related to the situation in order to accomplish work responsibilities in a pro-
be the most use? ductive manner? a. Job-specific technolo-
gies b. Internet use and security c. Infor-
A. timeliness
mation technology d. Telecommunications
B. accessibility
A. A
C. cost-effectiveness
B. B
D. relevancy
C. C
740. Providing marketing information is an im- D. D
portant channel activity. Businesses rely
on marketing information to determine 745. What are the 2 Marketing Functions NOT
experienced by the customer? They are
A. How intermediaries are performing
done behind the scenes.
B. Their target markets’ needs and wants
A. Marketing Planning
C. How much to charge for their products
B. Product Service Management
D. What to name their products
C. Marketing Information Management
741. What type of corporation may be owned (MIM)
by just a few people and does not offer its D. Pricing
shares for sale to the general public?
746. This is an organized collection of compre-
A. Private
hensive information about customer.
B. General
A. Customer database
C. Public
B. Database marketing
D. Limited
C. Data warehouse
742. What is the term that is used to deter- D. Data mining
mine the profitability of a product that is
another goal of pricing? 747. What is the best way for Michelle to or-
ganize the information that she has col-
A. Market share lected for a research report that she is
B. Return on investment writing?
C. Competition A. Edit her draft
D. Cost-Benefit Analysis B. Create the appendices
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 842
C. Correct grammatical errors 752. is not a marketing concept
D. Develop an outline A. Production concept
B. Selling Concept
748. Fill in the following blanks to explain
how marketing has helped consumers bya. C. supplier concept
Lowering of goods through competi- D. Societal concept
tionb customers about goods and ser-
753. Marketing manager outlines the market-
vicesc. Offering a of products and ser-
ing activities that will be undertaken to ex-
NARAYAN CHANGDER
vices
ecute the marketing strategy is known as
A. Prices b)Informing c)Wide Variety A. Marketing plan
B. Informing b)Offering c)select quality B. Marketing strategy
C. Complaints b)Reaching c)specific C. Marketing tactics
niche D. Marketing projections
D. none of above
754. What can be marketed?
749. Major household appliances and heavy A. Physical Products
consumer durables are referred to as: B. Services
A. Soft goods C. Tourist Place
B. Brown goods D. Election Candidates
C. White goods E. All of the above
D. Convenience goods 755. One behavioral segment of great impor-
tance to the marketer is the of the fo-
750. Brad’s job description states that he is re- cal brand because it is relatively easy to
sponsible for developing and implementing communicate to this group.
the marketing programs for Bick’s Pickles, A. past user
the brand he has been hired to manage.
Brad’s job title is B. future user
C. current user
A. category manager.
D. non-user
B. vice-president of marketing.
756. . a combination of four strategies used
C. marketing director.
to market a product is called:
D. brand manager. A. PEST analysis
E. sales manager. B. marketing mix
751. Which of the following sales promotion C. executive summary
technique used to induce the buyers to buy D. SWOT analysis
the product?
757. To feel hunger is a
A. Rebate A. Want
B. Sampling B. Need
C. Lucky draw C. Desire
D. Discounts D. Satisfaction
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 843
758. Which is not the pricing strategy listed 763. This type of label provides information
below? about product use, care, other features
PRACTICE BOOK» NOT FOR SALE
A. Cost Oriented A. descriptive
B. Market Oriented B. brand
C. Margin Pricing C. grade
D. Number Pricing D. none of above
759. Any group that has an actual or potential 764. Which one is not an example of an open
interest in or impact on an organization’s question?
ability to achieve its objectives. A. Why do you think that?
A. Publics B. Describe your experience?
B. Suppliers C. Please explain your answer?
C. Competitors D. Please select your size.
D. Customers 765. Select the 3 ways a business can reduce
inventory shrinkage.
760. A salesperson is most likely to find out
how effectively a product actually func- A. Check inventory more often
tions in normal, everyday use from a(n) B. Prevent theft
A. advertiser C. Taking physical inventory
B. competitor D. Don’t check figures
C. designer 766. Based in the customer’s perception alone.
D. customer A. Brand Identity
761. What is one advantage of observational B. Brand Image
research? C. Brand Recall
A. Observational research is expensive D. Brand Recognition
to conduct.
767. Which of the following is a true state-
B. Observational research is time con- ment about the consensus-building pro-
suming. cess:
C. The researcher can read body lan- A. It should involve only one or two ideas.
guage.
B. It should always be conducted for-
D. There might be uncontrollable vari- mally.
ables.
C. It varies from group to group.
762. Which type of duties do customer service D. It works best with only two people.
professionals often perform?
768. The central element of what is purchased
A. Preparing ads
is called the “core, “ and anything bought
B. Paying invoices on top of that is called what?
C. Handling complaints A. promotions
D. Receiving shipments B. goods
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 844
C. value addeds C. Compensation
D. extras D. Communication
769. Deciding how much to charge for goods 774. Department that handles recruitment, hir-
and services ing and firing, training and other employee
matters. They maintain policies, plans,
A. Pricing
and procedures for the effective manage-
B. Unit Cost ment of employees
NARAYAN CHANGDER
C. Selling A. supervisory-level management
D. Value B. Human Resources
770. An informational tag, wrapper or printed C. middle management
message that is attached to a product or D. Vertical Organization
package
775. This measure helps you find out where
A. Packaging your customers are going. What are the
B. label reasons for loss of customers.
C. FDA A. Periodic Surveys
D. UPC B. Mystery Shoppers
C. Customer Loss Rate
771. Which of the following does not give ex-
clusive ownership of certain types of prop- D. Monitor Competitive Performance
erty to individuals:
776. Which is one way that many businesses
A. Patent use the marketing information contained in
B. Trademark sales reports?
C. License A. To monitor expense accounts
D. Copyright B. To qualify potiental new customers
C. To improve the effectiveness of sales-
772. Select the technique and example used people
in pricing products.Technique:Pricing prod-
ucts in a given category at a particular D. To develop negotiating techniques
price. Pricing Example:Pricing all pants at 777. Which one is not an example of sec-
$25, $45, and $65. ondary research?
A. Promotional Pricing A. Scholarly journals
B. Everyday Low Price (EDLP) B. Word of Mouth
C. Pricing Lining C. Wikipedia
D. Bundle Pricing D. Focus groups
773. What might cease if producers decide 778. Marketing information management con-
that their incomes are inadequate to con- nects , , and the to a firm
tinue making goods and services? through information.
A. Consumption A. Consumers
B. Competition B. Customers
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 845
C. Public 783. Annie has decided to mark up the cost of
the newest bathing suit line she just or-
D. Targeted demographic
dered for her boutique by 50%. This is an
PRACTICE BOOK» NOT FOR SALE
779. Who makes the decisions in a Market eco- example of the marketing function.
nomic system? A. Pricing
A. Government B. Market research
B. Consumers C. Financing
D. Marketing
C. Based upon customs, beliefs, religion
and habits 784. The focus of the concept is on cus-
D. none of above tomer needs and the customer satisfaction
becomes the means to achieving the firm’s
780. “Profits could be maximized by attract- objectives of maximizing profits.
ing and persuading customers to buy the A. Marketing
products.” Identify the concept of market-
B. production
ing management highlighted by this state-
ment. C. Branding
A. PRODUCTION D. none of above
B. PRODUCT 785. Which form of external theft listed be-
low involves stealing merchandise from a
C. MARKETING
store?
D. SELIING
A. Shrinkage
781. Natalie searched for 45-minutes to locate B. Employee Theft
an important file folder, which she found C. Shoplifting
under a pile of papers in an unmarked box
D. Robbery
that was stored under her desk. What ac-
tion did Natalie fail to take that would 786. Mass marketing occurs when:
have increased her efficiency and saved
A. a group of services are bundled to-
the company money?
gether.
A. Using supplies wisely
B. all customers are treated in the same
B. Staying on task manner
C. Staying organized C. a product is marketed as a large entity.
D. Observing safety standards D. customers are segregated based on
their earning potential.
782. What is a tool that can help you deter-
787. Which of the following is a geographic
mine possible career choices for yourself?
factor?
A. an interest survey A. price
B. both a and b B. income
C. none of the above C. market size
D. a career personality profile D. media
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 846
788. What is a good question to ask yourself contact with the customer to inform them
when thinking about your future career? about potential products?
A. What are my strengths and weak- A. Advertising
nesses?
B. Publicity
B. What issues or causes do I care most
C. Personal Selling
about?
D. Sales Promotion
C. all of the above
NARAYAN CHANGDER
D. Which activities do I enjoy? 793. A producer decides to use agents to get
his products in the market. The producer
789. Six Flags Amusement Park wants to start is using
offering more games in the game area
A. Direct distribution
that will attract more teenagers. While
at the park, you are asked to complete a B. Channel A Distribution
questionnaire about games you would like C. Intermediaries
them to offer. This is an example of the
marketing function? D. No distribution
A. Selling 794. . Business A spends less on advertis-
B. Financing ing than Business B. Both businesses sell
the same products, but Business B charges
C. Target marketing higher prices than Business A. Which of the
D. Market research following factors has affected the prices of
the business:
790. Which of the following is not a challenge
A. Place
or problem of Indian Rural Markets
A. Many Languages and Diversity in cul- B. Supply
ture C. Product
B. Underdeveloped People and Underde- D. Promotion
veloped Markets
795. One of the purposes of establishing a re-
C. Rural Sales Management
lationship with a customer in the beginning
D. Increasing sale of Branded Products of the selling process is to
791. The best way for Melissa to determine if A. put the customer on guard
her company will pay the tuition for the B. make a single sale
class that she is taking at the community
C. gain the customer’s confidence
college is by
D. prevent customer’s objections
A. reviewing the production shedule
B. asking her college counselor 796. KING OF THE MARKET
C. reading the employee handbook A. SELLER
D. submitting a formal proposal B. SERVANT
C. BUYER
792. What type of promotion would a com-
pany use in order to provide one-on-one D. UNCLE
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 847
797. A type of testing which the company C. data gathering
selected certain stores in different geo- D. marketing research
graphic areas and ask them to keep its
PRACTICE BOOK» NOT FOR SALE
new product into their stores in return for 802. What mistake can companies make when
a fee. they define their core business?
A. Product Testing A. being myopic
B. Controlled Testing B. seeing the big picture
C. Simulation Testing C. being too strategic
D. none of above D. being too technical
798. What is “Consumer Behaviour? ” 803. Looks at what is going on in the market
A. The way consumers behave in a shop. with the goal of forecasting sales of prod-
ucts or services
B. Making a repeat purchase.
A. Market Research
C. The thoughts consumers have and the
B. Brand Management
actions they take when purchasing prod-
ucts. C. Public Relations
D. Customers being loyal to a business. D. none of above
799. What is it known as? A firm attempts 804. In charge of creating and maintaining a
to serve all customer groups with all the good public image for their business or or-
products they might need. ganization that they work for or repre-
sent.
A. Full coverage
A. E Marketing
B. All round coverage
B. Public Relations
C. Full market coverage
C. Brand Management
D. none of above
D. none of above
800. Ideas that are developed in one coun-
try may be considered for another so that 805. Market research must be:relevant, accu-
economies of scale can be realized. This is rate, current, and what?
a demonstration of A. Bias
A. differential marketing management. B. Expensive
B. global management. C. Correct
C. customer-centric marketing manage- D. Impartial
ment.
806. Which of the following orientation em-
D. regional marketing management.
phasizes on product’s benefits to the cus-
E. target market management. tomer rather than product attributes?
801. Which of the following is a good source A. Product
of internal data? B. Production
A. commercial Internet databases C. Sales
B. professional marketing research firms D. Market
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 848
807. Which of the following is not Correct? 812. is described as the set of marketing
A. From buyers need to buyer wants tools that a firm uses to pursue its market-
ing objectives in a target market.
B. From local to global markets
A. Product Mix
C. From price to non-price competition
B. Price Mix
D. From buyers need to producers wants
C. Promotion Mix
808. A well-chosen celebrity can draw atten- D. Marketing Mix
NARAYAN CHANGDER
tion to a product or brand. The choice of
the celebrity is critical. The most impor- 813. Finance, analysis and development, pur-
tant factor is the celebrity’s chasing, and manufacturing are all activi-
ties that are a part of that element of the
A. trustworthiness
micro environment?
B. likability
A. the suppliers.
C. credibility.
B. the company’s internal environment
D. expertise
C. the marketing channel firms
809. What is one question that a company D. the publics
needs to answer about a product that is
in the introductory stage of its life cycle? 814. Identify the type of market research data
based on the characteristics below:Data
A. Should we regionalize the product? that is collected by an outside agency to
B. Does the product need to be modern- help understand more about the consumer
ized? perception of products, etc
C. Should we take the product off the A. Company data
market? B. Competitor data
D. How can we make the public aware of C. Government data
our product?
D. Market research data
810. For each type of inventory control sys-
tem, select examples that a company may 815. A detailed version of the new product
use:I.e. Perpetual Inventory Control idea started in meaningful consumer form
is known as
A. Manual
A. Idea Generation
B. Computer based
B. Product Concept
C. Visual control
C. Concept testing
D. Tickler
D. Strategy Development
E. Annual Inventory Control
816. Which of the following is NOT a demo-
811. first stage of the product life cycle graphic variable?
A. start A. gender
B. introduction B. age
C. beginning C. culture
D. growth D. education
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 849
817. This is a promise about the experience 821. Some fast food restaurant offers tasty
customers can expect from the company’s and convenient food at affordable prices,
market offering and their relationship with but doing so they contribute to a national
PRACTICE BOOK» NOT FOR SALE
the supplier. obesity epidemic and environmental prob-
A. Value Delivery System lems. These fast food restaurant overlook
the philosophy.
B. Value Proposition
A. marketing concept
C. Loyalty
B. production concept
D. Customer Relationship Management
C. societal marketing concept
818. Sarah is speaking to a customer who is D. selling concept
decisive, forceful, and in a hurry. Sarah
should 822. Phase III in the evolution of rural market-
A. give the customer time to talk about ing belongs to the time period
himself/herself. A. 1960-1980s
B. get to the point of her communication B. 1990s-2010s
quickly.
C. Before 1960s
C. discuss detailed statistics and infor-
mation. D. 1980s-1990s
D. take time to develop a relationship 823. Which of the following is not part of the
with the customer. marketing concept?
819. When using exploratory interviews to A. Customer needs
identify occupational interests, you should B. Integrated marketing
try to interview someone who
C. Profits through customer satisfaction
A. has an executive position in the com-
D. Profits through sales volume
pany
B. used to have the kind of job you want 824. Which of the tools of public relations
C. holds the kind of job you want describes the financial activities of the
company-
D. hires people for the kind of job you
want A. Press Kit
B. Annual Reports
820. In which Marketing pathway do employ-
ees transfer goods and services to other C. Press Release
businesses and individuals? a. Profes- D. News Letter
sional Sales b. Marketing and Communi-
cations c. Merchandising d. Marketing Re- 825. Which of the following is the example of
search a tube of shaving cream?
A. A A. Primary Packaging
B. B B. Secondary Packaging
C. C C. Transportation Packaging<br />
D. D D. None of these
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 850
826. Ration shop is a- C. Multi-channel distribution
A. Wholesale Trade D. Integrated distribution
B. Public Distribution 832. The process of planning, pricing, promot-
C. Direct sale ing, and selling goods or services that sat-
D. none of these isfy customers needs is called
A. Selling
827. Which is not part of the Advertising
B. Promoting
group-
NARAYAN CHANGDER
C. Marketing
A. print
D. Marketing Concept
B. digital
C. outdoors 833. Kwacky Kwackers needs a new package
design for its crackers. Which marketing
D. broadcast
professional field would be responsible for
828. Bad variability involves creating the new package?
A. weather patterns A. Marketing research
B. errors in the system B. Product management
C. technology C. Advertising
D. manufacturing tolerances D. Channel management
829. When you go out for dinner in a restau- 834. Which of the following is NOT a type of
rant, who will be considered as the mar- factor in a company’s macroenvironment?
keter? A. demographic
A. You B. economic
B. The restaurant owner C. technology
C. Both D. competitor
D. none of above 835. An ad informing consumers of a com-
pany’s efforts to stop pollution is an ex-
830. Planning, promoting, distributing prod-
ample of promotion.
ucts
A. promotional
A. Marketing Concept
B. institutional
B. Marketing Mix
C. direct-mail
C. Market Share
D. retail
D. Marketing
836. Which of the following is most closely re-
831. Disney sells its videos through five main
lated with the organic growth of an orga-
channels:movie rental stores like Block-
nization?
buster, Disney company retail stores, and
a few other retailers. Disney is a good ex- A. entering new marketplaces
ample of what type of distribution? B. increasing the operational profitability
A. Selective distribution C. increasing productivity of employees
B. Intensive distribution D. developing new products from within
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 851
837. Firms that share similar or the same ac- 842. A is an elaborated version of the idea
tivity as our main activity in the company expressed in consumer terms.
are
PRACTICE BOOK» NOT FOR SALE
A. test brand
A. the intermediaries
B. “alpha” product
B. the suppliers
C. “beta” version
C. the competitors
D. product concept
D. none of above
843. Which of the following is a true state-
838. Magazines and pastries are examples of ment about marketing plans?
products.
A. They require a lot of time and effort to
A. Convenience write
B. Shopping
B. They are important only for new busi-
C. Specialty nesses
D. All the above C. They are internal documents written
for management
839. Income, ethnic background, gender, and
age are all examples of segmentation D. They work best for big companies
bases.
844. Which function is concerned with making
A. geodemographic decisions about investments and credit?
B. organizational A. marketing information management
C. demographic B. pricing
D. socioeconomic
C. financing
840. What can a business do to determine D. distribution
if there are problems with its customer-
service levels in relation to its product- 845. Green Products means
distribution strategies?
A. Eco Friendly
A. Conduct a break-even analysis
B. Recyclable
B. Evaluate its channel members’ perfor-
C. Reusable
mance
C. Analyze the product’s quality stan- D. Reduce Pollution
dards E. non renewable
D. Examine the organizational chart
846. The market consists of people who
841. The level of packing used to present a gift purchase goods and services for personal
to your friend on his birthday- use.
A. Primary A. Industrial
B. Secondary B. Consumer
C. Transportation C. Customer
D. None D. Business
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 852
847. In order to decide which tasks are most 852. The three areas of consideration that
important and the order in which the tasks should be balanced in the societal market-
are to be completed, planners can use the ing concept are consumer wants, society’s
interests, and
A. GDP Factor
A. human welfare
B. ABC Principle
B. want satisfaction
C. RH Factor
C. company profits
D. XYZ Principle
NARAYAN CHANGDER
D. short-run wants
848. Charles Schwab enables its customers to
do transactions in its branches, over the 853. A popular tool for segmenting that uses
phone, or on the Internet. This is an ex- psychographic data, and that is based on
ample of a company using channels. the belief that one’s attitudes and value
system determine one’s orientation to cer-
A. interactive tain products and/or brands is called
B. hybrid A. Experian.
C. dual B. VALS.
D. targeted C. Mals.
849. What activity are Nikki and Josh per- D. Prizm.
forming when they read over a scenario
854. Collection of is a basis to make deci-
and then act out the parts in a training
sions.
class?
A. Product
A. Experimenting
B. Information
B. Brainstorming
C. Service
C. Meditation
D. Decision
D. Role-playing
855. The job of a marketer, is to add to the
850. Is all the activities of designing and pro- of the product so that the customers pre-
ducing the container for a product. fer it in relation to the competing products
A. Packaging and decide to purchase it.
B. Product Line A. Features
C. Product-Mix B. Quality
D. none of above C. Quantity
D. Value
851. Creating brand awareness is a duty in
which pathway? 856. Value-added services’ means
A. Professional Sales A. Better value at a premium
B. Marketing Management B. Costlier services
C. Merchandising C. Additional services
D. Marketing Research D. Better value at a discount
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 853
857. Identify the purpose for a business to 862. Subdividing of market into homogeneous
use inventory control systems.For exam- subsections of customers is referred to as:
ple, by controlling how much products are
PRACTICE BOOK» NOT FOR SALE
A. Target marketing
in inventory will help businesses identify
theft in their company. B. Market segmentation
A. Manage the amount of products C. Product positioning
B. Theft D. Differentiated marketing
C. Errors 863. Task environment in marketing is other-
D. none of above wise referred to as:
A. Micro environment
858. If demand hardly changes with small
changes in price the demand is B. Macro environment
C. Competitive environment
A. elastic
D. Socio-cultural environmnet
B. neutral
C. inelastic 864. Which stage is where profits are at all
time high
D. unitary
A. Growth
859. A description of the ultimate goals of a
B. Decline
company.
C. Maturity
A. Recruiting
D. Introduction
B. Mission Statement
C. Human Resources 865. content planning & content production
termasuk strategy digital marketing yang
D. Rewards and encourage creativity
mana?
860. Ajay calls his friend Akash and requests A. identify
him to sell one of his paintings to Rama’s
B. Develop
mother. In this transaction who is the mar-
keter? C. Engagement
A. Ajay D. Accelerate
B. Akash 866. Newlyweds are most likely to spend
C. None money on which of the following?
D. Both A. charitable giving
B. furniture
861. Following is the importance of studying
Rural Marketing Environment C. music
A. Helpful in recognizing new market op- D. health care
portunities 867. Transporting and storing goods is part
B. Helpful in taking marketing decisions of which of the following marketing func-
C. All of the above tions?
D. Helpful in understanding rural market A. inventory channel
conditions B. physical distribution channel
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 854
C. direct marketing channel 873. Rob decides that he really can’t know if
D. warehousing channel Patrick will help him unless he asks, so he
decides to do so. Which step of the seven-
868. A request for information is also called step problem-solving method does this sit-
a/an: uation illustrate?
A. Investigate competitors
A. Evaluate the solution
B. Identify problems
B. Select and implement a solution
C. Evaluate market share
NARAYAN CHANGDER
D. Analyze economic changes C. Define the problem
869. What is not included in the marketing mix D. Determine possible solutions
strategy is?
A. Product 874. The is something that the consumer
B. Price needs or wants. a. Price b. Product c.
Package d. Item
C. Place
D. Promotion A. A
E. Plan B. B
870. Buy 2 soaps get 1 soap free. Identify the C. C
technique of sales promotion.
D. D
A. Quantity gift
B. Product combination
875. Deciding the amount to charge customers
C. Discount for products/services based on demand,
D. Rebate completion, and the costs of raw materi-
als.
871. An analysis of outside influences on an
organization is called: A. Distribution
A. PEST analysis B. Marketing Information Systems/Market
B. marketing mix Research
C. executive summary
C. Product/Service Management
D. SWOT analysis
D. Pricing
872. Jason works for Sky Airlines. When re-
serving airline tickets for customers by
876. Which of the following is NOT likely to
telephone, Jason needs to obtain the cus-
be a demographic characteristic of a popu-
tomer’s desired arrival and departure loca-
lation?
tions, travel dates, and
A. passport and credit card information A. income level
B. identification number and email B. age
adress
C. contact and payment information C. lifestyle
D. telephone number and travel code D. education
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 855
877. Nikki loves order and efficiency. She 882. This includes all the experiences the cus-
works to make sure that the supply chain tomer will have on the way to obtaining
is running properly and loves to organize and using the offering.
PRACTICE BOOK» NOT FOR SALE
and track her company’s products. Which A. Value Delivery System
career path is Nikki most likely in?
B. Value Proposition
A. Buying and Merchandising
C. Loyalty
B. Distribution and Logistics
D. Customer Relationship Management
C. E-Marketing
883. Components of a laptop are examples of
D. Management
A. Durable products
878. Before introducing a product to the mar- B. Materials and parts
ketplace, a business might monitor its com-
petitors’ strategies. C. Installations
D. Maintenance and repairs
A. training
B. scheduling 884. A means of encouraging appropriate
workplace behavior in order to improve
C. auditing employee performance.
D. pricing A. remedial action
879. Producing a positive public image. Cam- B. preventive discipline
paign to create a favorable public image C. Corrective Discipline
for a person, organization or company is
D. Effective Management Techniques
the definition for
A. Mass Marketing 885. Companies pursue as their ma-
jor price objective if they are plagued
B. Public Relations with overcapacity, intense competition, or
C. Promotions changing consumer wants.
D. Product Line A. maximum profit share
B. market skimming
880. Direct marketing is also known as:
C. survival
A. Zero channel
D. maximum market share
B. One channel
886. Choose the concept to the following defi-
C. Two channel
nition:It consists of the actors and forces
D. Three channel<br /> outside marketing that affect marketing
management’s ability to build and main-
881. Rechargeable batteries are an example tain successful relationships with target
of what type of innovation? customers.
A. Product A. Microenvironment
B. Paradigm B. Macroenvironment
C. Convertible C. Marketing Environment
D. Categorical D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 856
887. Which of the following statements is true by the company to produce its merchandise
of spreadsheets: and service.
A. “Row” and “column” are interchange- A. Competitor networks
able terms. B. Marketing intermediaries
B. A cell is where a column and row inter-
C. Suppliers
sect
D. Service representatives
C. A column is horizontal, while a row is
NARAYAN CHANGDER
vertical 892. Products that move back to the manufac-
D. A row is where a column and cell inter- turer for recycling or refurbishing are mov-
sect ing through channels.
A. multi-flow
888. Which tasks are typical for someone
working in Buying and Merchandising? Se- B. reverse-flow
lect all that apply. C. industrial
A. analyzing a product’s supply chain D. disposal
B. setting up products on shelves, dis-
plays, and storage areas 893. product information gathered from Inter-
net use is:
C. hiring, training, and supervising work-
ers A. implementation
D. analyzing customers’ needs and prob- B. market segmentation
lems, and identifying solutions C. demographics
889. Why does a company measure productiv- D. market research
ity?
894. Manny has a new idea for a new cleanser
A. Understand the capacity of a company that would decrease the time in cleaning
at a given time tiled floors. He thinks this product would
B. To see who is a good worker be better than any cleanser currently on
the market. Which of the four Ps should
C. Reduce costs
these investors consider first?
D. Increase sales
A. Product
890. Give clear directions; Be consistent; Treat B. Price
employees fairly; Be firm when necessary;
C. Promotion
Set a good example; Delegate responsibil-
ity; Foster teamwork; Be ethical. D. place
A. Effective Management Techniques 895. Why is it important for businesses to
B. Horizontal Organization monitor customer purchases?
C. Rewards and encourage creativity A. To satisfy consumers’ needs and
wants
D. Human Resources
B. To block consumers’ economic votes
891. are an important link within the com-
pany’s overall “value delivery system” C. To promote slow-selling merchandise
since they supply the resources required D. To classify their products
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 857
896. This includes the packaging, style, fea- C. Marketing Mix
ture, quality, and the brand name of the
D. Economics
product.
PRACTICE BOOK» NOT FOR SALE
A. Core Benefit 901. Kegiatan “simplified & applied terri-
B. Actual Product tory management concept” dan “exhibi-
tion standardization” termasuk kedalam
C. Augmented Product marketing mix strategy yang mana?
D. Potential Product A. Product
897. Identify the type of market research data B. Price
based on the characteristics below:Data
C. Place
that can help company’s understand con-
sumer wealth, demographic data (US Cen- D. Promotion
sus), etc to drive business decisions.
E. Plan
A. Company data
B. Competitor data 902. ‘Maldives is safe to visit in Covid Pan-
demic’ What is marketed here?
C. Government data
A. Service
D. Market research data
B. Idea
898. Which of the following is an example of
descriptive research? C. Place
A. clinical trial D. Event
B. survey 903. Which of the following elements is specif-
C. interview ically related to a societal orientation?
D. focus group A. Earning a profit
899. In an economy, individuals, businesses B. Total quality management
and the government have a variety of C. Concern for ethical behaviour.
choices on which to spend their money.
Once the choice is made, the alternative D. Defining clear objectives.
choices given up are considered:
904. Dove was originally a facial bar soap.
A. Opportunity costs Unilever has developed products in the
B. Trade offs body wash, hair care, moisturizer, and
antiperspirant segments with the Dove
C. Decision
brand name. Unilever has engaged in
D. Possibilities with this brand.
900. What is the term used to describe the co- A. functional launching
ordination of all marketing strategies in a B. product stretching
company known as product, price, place
and promotion? C. commercialization
A. Market segmentation D. business analysis
B. Marketing E. innovation diffusion
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 858
905. What is the measure of the output of 910. Goods are:
a worker, machine, or an entire national A. tangible items
economy in relation to the creation of
goods and services to produce wealth? B. selling
A. Economy C. channel management
B. Efficiency D. market share
C. GDP 911. Under which marketing philosophy, the
NARAYAN CHANGDER
D. Productivity firm shifted from quantity of production to
quality of products?
906. Putting out “Wet Floor” signs is one way A. Production concept
to handle risk and is known as which of the
following? B. Product concept
A. Avoid C. Selling concept
B. Shift D. Marketing concept
C. Retain 912. IT IS THE HEART OF THE INTERNAL
D. Reduce RECORDS SYSTEM.
A. SALES INFORMATION SYSTEMS
907. Pricing helps determine
B. THE ORDER-TO-PAYMENT CYCLE
A. Profits
C. DATABASES
B. Advertising
D. DATA MINING
C. Value & image
D. Product & management 913. The managerial perspective is important
with respect to assessing whether serving
908. . Which step in the new-product devel- a specific is consistent with overall cor-
opment process involves seeking feedback porate goals.
from consumers in order to know what A. market segment
response they would give to a proposed
product? B. product
A. Idea generation C. provider
B. Product screning D. competitor
C. Concept testing 914. Define the term Advertising:
D. Feasibility analysis A. following and studying a professional
in order to learn a trade
909. What is Marketing Management?
B. The name, symbol, slogan message or
A. Managing the market design used to identify a products reputa-
B. Act that describes how a market is tion and image.
managed C. A company offers several complemen-
C. How to sell tary products in one package
D. Activity that shows the aspects of Mar- D. the act of calling public attention to a
keting product or service
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 859
915. Which of the following is not included in 920. Which choice includes all the types of em-
price mix ployers that exist in the Marketing, Sales,
and Service career cluster?
PRACTICE BOOK» NOT FOR SALE
A. Credit policy
B. trade discount and cash discount A. private companies, the government,
self-employers, and organizations
C. demand for a product
B. private companies
D. period of credit
C. private companies and self-employers
916. In order to enhance the easy marketabil-
ity of the products, Dev, a producer gets D. the government, self-employers, and
the home furnishing products manufac- organizations
tured in conformation to the predeter- 921. A very small section of the whole mar-
mined specifications . Identify the type of ket which has not yet been identified and
marketing function being described in the served by competitors is referred to as:
given case.
A. Segment marketing
A. Physical distribution
B. Local marketing
B. Standardisation and grading
C. Niche marketing
C. Transportation
D. Warehousing D. Individual marketing
917. which one of the following is not a 4 P’s 922. Which category not fall under marketing
of marketing? mix?
A. Public A. People
B. Promotion B. Process
C. Price C. Physical evidence
D. Place D. Placement
918. Steven needs to determine the most cost 923. Identify the factor based on the given
effective way to have his products dis- explanation.As consumer perception in-
tributed from the producer to his cus- creases, so will the price and vice versa
tomers. This function of marketing is
A. Cost & Expenses
known as:
B. Supply & Demand
A. Channel Management
B. Marketing-Information Management C. Consumer Perception
C. Pricing D. Competition
D. Product/Service Management E. Government
919. Develop marketing mix (4 Ps) strategy is 924. Dennis has a great idea for a new type
the in marketing process. of tennis ball that, if produced, would be
better than any ball currently on the mar-
A. first step
ket. He pitches his idea to a few in-
B. second step vestors. Which of the four Ps should these
C. third step investors consider first?
D. fourth step A. Product
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 860
B. Price D. product, cost based pricing
C. Promotion E. 1 and 2
D. Place
930. In an economic system, the decision to
925. Which of the following Four Ps of Mar- sell products to middle class teenagers
keting directly impacts revenue? a. Pro- whose hobbies include sports answers
motion b. Price c. Product d. Place which economic choice?
A. A A. What to produce?
NARAYAN CHANGDER
B. B B. For whom to produce?
C. C C. How to produce?
D. D D. When to produce?
926. Joseph received an email message from 931. Media publics do NOT include:
his supervisor and wants to send it to his
A. radio and television
coworker, Jackie. What email function key
would Joseph use to send the message to B. newspapers and magazines
Jackie? C. social media
A. Reply D. government
B. Forward
932. Those who are interested in buying the
C. Edit
shares of a company which are naturally
D. New interested in the financial statements to
know how safe the investment already
927. Select the explanation for merchandising-
made is and how safe the proposed invest-
related discounts, Percentage or dollar re-
ment will be.
duction in the retail price
A. capitalists
A. Cash discounts
B. creditors
B. Quantity discounts
C. investors
C. Trade discounts
D. Seasonal discounts D. workers
928. Which wants for specific products backed 933. Which can be produced and marketed as
by an ability to pay? a product?
A. Need A. Ideas
B. Wants B. Information
C. Demand C. Experiences
D. Ability D. Persons
929. what are the seven p’s of marketing 934. Select the technique and example used in
A. product, price, place, promotion pricing products.Technique:Setting prices
that end in either odd numbers to send
B. physical evidence, people, process a message of value or ending in posi-
C. personal selling tive numbers to send the message of high
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 861
quality. Example:$19.99-Value$20-High C. s/he needs a point clarified
Quality D. s/he does not agree with the speaker
PRACTICE BOOK» NOT FOR SALE
A. Odd-Even Pricing
940. Sia went to a shop and expressed her de-
B. Prestige Pricing sire to buy a copper water bottle only of
C. Multiple Unit Pricing prestige company. Identify the component
related to branding being described here.
D. Bundle Pricing
A. Trade mark
935. Conducting a survey to gather informa-
B. Generic name
tion is:
C. Brand name
A. Secondary research
D. Brand mark
B. Observational research
C. Ethnographic research 941. ‘Lifebuoy soap’ and ‘Close up toothpaste’
are manufactured by
D. Primary research
A. Nestle
936. With self-service, the of the service B. Proctor and Gamble
encounter is reduced by the standardiza-
tion of the equipment. C. Hindustan Unilever Ltd.
A. purchaser D. Amul
B. provider 942. Coca Cola test marketed New Coke by
conducting taste test in focus groups.
C. desirability
What marketing function did they imple-
D. variability ment?
937. The buying process starts when the buyer A. distribution
recognizes a B. marketing information management
A. Product C. selling
B. an advertisement for the product D. promotion
C. a sales person from a previous visit 943. During the last three months of the year,
D. Problem or need a grocery store stocks its shelves with
plenty of canned pumpkin in order to in-
938. Which of the following is not considered crease the pumpkin’s utility.
a technological innovation:
A. Time
A. The wheel
B. Form
B. The weather
C. Information
C. The internet
D. Price
D. The cell phone
944. New-to-the-world products are
939. It is appropriate for a participant to ask A. low-cost products designed to obtain
questions during a staff meeting when an edge in highly competitive markets
A. the agenda is being distributed B. new product enhancements that sup-
B. another participant is speaking plement established products
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 862
C. new versions of an existing product A. easy
that has been less successful
B. moderately difficult
D. new products that create an entirely
C. challenging
new market
D. impossible
945. THE BUSINESS UNIT THAT IS OPERATING
IN HIGH MARKET GROWTH RATE BUT IN 950. What types of skills are important to
A LOW COMPETITIVE ENVIRONMENT BE- have in a career in marketing?
NARAYAN CHANGDER
LONG IN WHAT BCG MATRIX?
A. analytical careers
A. QUESTION MARK
B. creativity
B. CASH COW
C. problem solving skills
C. DOG
D. all of the above
D. STAR
951. Select the factor based on the explana-
946. At which time did marketing emerge? tion:Companies want more than one prod-
A. During the middle ages uct to reach customers. For example, the
B. During World War I Nintendo Wii has not just the console, but
accessories, games, etc.
C. During the Industrial Revolution
A. Product Line (Depth, Extension & Con-
D. During the twentieth century traction)
947. The reliability of a search result is: B. Branding
A. The degree to which the results are ac- C. Packaging
curate
D. Product Modification
B. The degree to which the results dis-
E. Repositioning
prove your theory
C. The degree to which the results are 952. Identify the purpose for a business to
consistent use inventory control systems.For exam-
D. The degree to which the results are in- ple, companies will be able to identify er-
accurate rors in the point-of-sale system.
A. Manage the amount of products
948. Which of the following utilities involves
making products? B. Theft
A. information utility C. Errors
B. place utility D. none of above
C. form utility 953. A warranty that covers the entire prod-
D. possession utility uct is known as a(n) warranty.
949. Some customers are currently using a A. full
competitor’s brand or don’t purchase a cer- B. limited
tain type of product. It is for mar-
C. express
keters to identify, obtain information on,
and woo these people. D. implied
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 863
954. What is the expansion of PLC? C. After sale service
A. Production life cycle D. Cross selling
PRACTICE BOOK» NOT FOR SALE
B. Product life cycle E. None of these
C. Product line cycle 960. process refers to original products,
D. Production level concepts product improvements, product modifica-
tions, and new brands developed from the
955. Who created the hierarchy of needs? firm’s own research and development ca-
A. Maslow pabilities.
B. Watson A. New Product Development
C. Skinner B. Acquisition
D. Freud C. Market Share Development
D. Market Segmentation
956. Works mainly online determining the best
means to reach consumers on the Internet. 961. decisions dictate how much to charge
A. Product Management for goods and services in order to MAKE A
PROFIT.
B. Market Research Analysist
A. Pricing
C. Promotions
B. Promotion
D. none of above
C. Selling
957. What types of applications help com-
D. Market Planning
puter users manage their appointments
and work activities through email soft- 962. Natural resources are provided by nature,
ware programs? and capital resources are provided by
A. Task, calendar, and contact functions A. machinery
B. Calendar, addrss book, and view mech- B. people
anisms
C. technology
C. Contact, workbook, and view settings
D. automation
D. Address book, task, workbook fea-
tures 963. consists of all the org. that acquire
goods and services used in the production
958. Doctor’s services consist mainly of el- of other products or services that are sold,
ements. rented or supplied to others.
A. product A. Monopoly market
B. search B. consumer market
C. experience C. Business market
D. credence D. none of the above
959. Relationship marketing means 964. Price of a product can be referred to as
A. Selling to relatives A. Production Cost
B. Selling by relatives B. Brand Value
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 864
C. Value of utility for customer 970. Marketers often use the term to
cover various groupings of customers.
D. Promotion Cost
A. People
965. Which is not the function of packaging? B. Buying Power
A. Transportation of goods C. Demographic segment
B. to attract the consumer D. Market
C. To increase the price of goods
NARAYAN CHANGDER
971. Which intermediary obtains goods to sell
D. Identificationof product to industrial users?
A. Wholesaler
966. Good marketing is no accident, but a re-
sult of careful planning and B. Agent
A. strategies C. Retailer
B. research D. none of above
C. selling 972. Which type of organization best suits a
nationwide department store with each
D. execution store having 12-15 departments?
967. Which of the following is an example of A. Effective Management Techniques
causal research? B. Horizontal Organization
A. case study C. Recruiting
B. survey D. Vertical Organization
C. test marketing 973. LCD TV purchased is an example of
D. pilot study A. Convenience products
968. Individuals and households who buy B. Shopping products
goods or services for personal consump- C. Speciality products
tion are D. Durable products
A. the customers
974. Some resources are available to man-
B. the suppliers agers who need to recruit new employ-
C. the intermediaries ees. (Current employees; Media advertis-
ing; State employment services)
D. none of above
A. Vertical Organization
969. This marketing concept focuses on per- B. middle management
suading and convincing customers to buy C. supervisory-level management
the Products-
D. Recruiting
A. production
975. Which marketing career field involves de-
B. product
termining why customers do what they
C. selling do?
D. marketing A. Advertising
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 865
B. Distribution or warehousing 980. A nail salon is an example of what type
of business represented in our society?
C. Sales
PRACTICE BOOK» NOT FOR SALE
A. Service
D. Market research
B. Global/International
976. What type of promotion would a com- C. Retail
pany use to stimulate interest in a com- D. Online
pany or its product by physically display-
ing products that draws potential cus- E. Franchise
tomers? 981. In which pathway do professionals
A. Advertising plan, coordinate and implement marketing
strategies advertising promotion and pub-
B. Publicity lic relations activities? a. Marketing Com-
C. Visual Merchandising munications b. Merchandising c. Market-
ing Management d. Professional Sales
D. Personal Selling
A. A
977. refers to natural resources that are B. B
needed as inputs by marketers or that are C. C
affected by marketing activities.
D. D
A. Economic environment
982. Secondary research is:
B. Technological environment
A. Collected for the first tome by the re-
C. Natural environment searcher
D. Cultural environment B. Obtained from research previously
conducted
978. Which intermediary brings buyers and C. Obtained from interviewing someone
sellers together but does not take owner-
D. Collected by administering a survey.
ship of the actual product?
A. Wholesaler 983. A relational database that is designed for
query and analysis.
B. Agent
A. Customer database
C. Retailer B. Database marketing
D. none of above C. Data warehouse
D. Data mining
979. Which career professional are usually re-
quired to have at least a bachelor’s de- 984. It is the process of carefully managing
gree? detailed information about individual cus-
A. Logistics Analysts tomers and all customer touch points to
maximize-customer loyalty.
B. Retail Salespersons
A. Measuring Satisfaction
C. Market Research Analysts B. Customer Relationship Management
D. Survey Researchers C. Customer Value Analysis
E. Public Relations Specialists D. Database Marketing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 866
985. What was the name of the first search C. Venture Capital
engine? D. Brainstorming
A. Archie
990. Select the technique and example used in
B. Veronica pricing products.Technique:Pricing several
C. Jude complementary products together for one
price. Example:Pricing a video game con-
D. Google sole, accessories and 2 games all together
for $160.
NARAYAN CHANGDER
986. Collecting and analyzing information in
order to make decisions about a prod- A. Odd-Even Pricing
uct/service. B. Prestige Pricing
A. Distribution C. Multiple Unit Pricing
B. Marketing Information Systems/Market D. Bundle Pricing
Research
991. Which marketing philosophy gives more
C. Product/Service Management importance to consumer welfare instead of
D. Selling consumer satisfaction?
A. selling
987. What form of promotion is generally
emphasized for complex, technical prod- B. product
ucts sold to industrial users:manufacturing C. societal
equipment, hospital equipment, or trans- D. marketing
portation options.?
992. Who is known as the father of modern
A. Sales promotion marketing management?
B. Advertising A. Henry Fayol
C. Personal selling B. Abraham Maslow
D. Publicity C. Peter Drucker
988. Empty nesters tend to start dreaming D. Philip Kotler
of spending their greater discretionary in- 993. Organizations in a mobilize their re-
come on sources toward selling, advertising and
A. music and movies. other promotional efforts.
B. furniture and remodeling. A. Sales orientation
C. higher education. B. Marketing orientation
C. Product orientation
D. travel and hobbies.
D. Production orientation
989. Inviting broad communities of people,
customers, employees, independent scien- 994. identify the needs of each division includ-
tists and researchers and even the public ing which digital marketing strategy?
at large into the new product innovation A. identify
process is known as B. Develop
A. Crowd Funding C. Engagement
B. Crowdsourcing D. Accelerate
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 867
995. Which of the following is used for La- C. Product Mix Strategy
belling?
D. Marketing Strategy
PRACTICE BOOK» NOT FOR SALE
A. Sign
1001. When McDonald’s decided to begin of-
B. Symbol or design
fering healthier menu options by selling
C. Name salads, fruit, and oatmeal in order to in-
D. All of these crease sales by attracting healthy con-
scious customers, they were making deci-
996. It refers to that part of a brand which can sions that are a part of which marketing
be spoken. Identify. function?
A. Product Mix A. Promotion
B. Brand name B. Product/Service Management
C. Brand mark C. Finance
D. Trade mark D. Marketing Information Management
997. The decline in the average cost with accu-
1002. Which holds that consumers prefer prod-
mulated production is called the
ucts that are widely available and inexpen-
A. variable cost sive?
B. demand curve A. Product concept
C. learning curve B. Selling concept
D. supply curve C. Production concept
998. Market refers to D. Marketing concept
A. an area or infrastructure
1003. Which of the following can be mar-
B. where buyers and sellers meet keted?
C. close contact between buyers and sell- A. Kerala Tourism persuading people to
ers visit Kerala for health tourism.
D. All of the above B. Red Cross society persuading to do-
nate blood.
999. The total number of products within all
product lines of a company is referred to C. Political parties persuading to vote for
as: a particular candidate.
A. Width of product mix D. All of the above
B. Length of product mix
1004. . By counting the number of gifts
C. Depth of product mix wrapped at the gift-wrapping booth in a
D. Consistency of product mix local mall, you are determining
A. Input
1000. is a plan for determining which prod-
ucts a business will manufacture or stock. B. Output
A. 4 P’s C. Ratio
B. Promotional Mix Strategy D. Technology
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 868
1005. Sunita calls her friend Suman and re- C. data gathering
quests her to sell one of her paintings to D. marketing research
Rama’s mother. In this transaction who is
the marketer 1010. What is the visual tool in presentation
software that smoothly moves one slide
A. Sunita
into the next slide?
B. Suman
A. Transition
C. Both B. Animation
NARAYAN CHANGDER
D. None C. Quick Access Toolbar
1006. When conducting research, a student D. Title Bar
should:
1011. Which of the following should be in-
A. only use one search engine cluded in a marketing plan’s executive
B. use multiple search engines summary?
C. never use a search engine A. A description of the target market(s)
D. use only the search engine that they B. The names and numbers of marketing
are most familiar with team members
C. The organization’s mission statement
1007. What does the 80:20 rule say?
D. A SWOT analysis chart
A. Eighty percent of sales will come from
20% of customers. 1012. Which intermediary obtains goods in or-
der to sell them directly to consumers?
B. For every 80 people who look at a prod-
uct, 20 will buy it. A. Wholesaler
C. For every 80 customers, 20 will be re- B. Agent
peat customers. C. Retailer
D. Eight percent of customers are only in- D. none of above
terested in 20% of available merchandise.
1013. What type of segmentation occurs when
1008. What does a business need in order to a business researches particular regions of
understand why a product that has been a the US to market its products to in order
strong seller for a long time is now losing to reach the most people?
popularity? A. Demographics
A. Marketing information B. Psychographics
B. Sales records C. Geographics
C. Secondary data D. Product Benefit
D. Purchasing documents 1014. Packaging, Lebelling and Branding are
the important elements of which of the fol-
1009. Which function of a marketing-
lowing marketing mix?
information management system involves
collecting facts and figures from internal A. Place
and external sources of an ongoing basis? B. Price
A. data processing C. Product
B. information reporting D. Promotion
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 869
1015. What focuses on integrating various de- C. C
partments within a company to accomplish D. D
its strategic goals?
PRACTICE BOOK» NOT FOR SALE
A. Mission 1020. Deciding on how goods get into cus-
tomers’ hands
B. Vision
C. Quality policy A. Distribution
D. Strategic planning B. Possession
C. Place
1016. refers to the ways in which the com-
pany will market and distribute the prod- D. Time
uct or service. a. Promotion b. Price c.
Product d. Place 1021. is a simple way to engage in inter-
national marketing
A. A
A. Licencing only
B. B
B. Direct Investment, Joint Ventures, Li-
C. C
censing, Direct Exporting, Indirect Ex-
D. D porter
1017. Age, gender, marital status, ethnic back- C. Indirect Exporter
ground & occupation are statistics often re- D. Joint Venture
ferred to as?
A. Target Market 1022. involves purchase from various
sources & assembled at one place
B. Demographics
A. selling
C. Psychographics
D. Groups B. buying
C. assembling
1018. The Thirst Quenchers beverage company
is surveying prospective customers to de- D. promoting
termine demand for its newest soft drink.
1023. Which display, sell, or deliver the phys-
Thirst Quenchers is collecting data.
ical product or service(s)
A. primary
A. Communication channels
B. secondary
B. Service channels
C. irrelevant
C. Marketing channels
D. economic
D. Distribution channels
1019. Which of the following is NOT a decision
associated with the price of a product? a. 1024. The belief that high sales result in high
The price to set b. Whether or not to of- profits.
fer rebates c. Whether or not to offer dis-
A. Sales
counts d. How the company will reach the
right consumer B. Production
A. A C. Market
B. B D. Societal
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.11 Marketing Management 870
1025. By increasing awareness of the need for 1030. Which of the following is an example of
environmental controls, what has market- “experience marketing”?
ing done? A. Starbucks
A. Made buying more convenient B. Cirque du Soleil
B. Regulated the standard of living C. clothing
C. Improved the quality of life D. financial services
D. Added usefulness to products
NARAYAN CHANGDER
1031. A box containing 20 small boxes of
1026. characteristics such as attitudes, opin- chocolates is an example of
ions, interests and values are: A. Primary packaging
A. demographics B. Secondary packaging
B. psychographics C. Transportation Packaging
C. geographics D. none of above
D. behavior analysis 1032. Providing customers with goods and
services they want
1027. Marketers segment the market on the
basis of personality of consumers.Identify A. Selling
the bases of market segmentation? B. Pricing
A. Demographic segmentation C. Placing
B. Behavioural segmentation D. Distribution
C. Psychographic segmentation 1033. The ideal goal for the marketer is to find
D. Geographic segmentation a(n) group of customers whose needs
it can easily and profitably meet.
1028. It combines the design and implementa-
A. quality
tion of marketing activities and programs
to build, measure, and managed brand to B. overserved
maximize their value. C. untapped
A. Strategic Brand Planning D. competing
B. Strategic Brand Management
1034. Identify the factor based on the given
C. Brand Management explanation.As government gets more in-
D. Brand Planning volved and poses requirements, prices can
increase. However, the government can
1029. Regarding the phrase “time is money, “ also set a price ceiling such as in the natu-
what type of effect does time seemingly ral gas market
have on money? A. Cost & Expenses
A. positive effect B. Supply & Demand
B. no effect C. Consumer Perception
C. little effect D. Competition
D. negative effect E. Government
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.12 Legal Aspects of Business 871
1035. Type of management in which managers cle
supervise the employees who carry out
A. Introduction, maturity, growth, de-
the tasks assigned by top & middle man-
PRACTICE BOOK» NOT FOR SALE
cline
agement.
A. controlling B. Introduction, growth, decline, matu-
rity
B. middle management
C. Introduction, growth, maturity, de-
C. top management
cline
D. supervisory-level management
D. Introduction, decline, maturity,
1036. What is the order of the product life cy- growth
1.12 Legal Aspects of Business
1. TWO characteristics of a simple contract; 5. what is a contract?
A. legal A. a legally binding agreement between
B. good faith( parties to a contract will two or more persons or entities enforce-
deal with each other honestly) able by law.
C. right of the other party B. a agreement between two or more per-
sons or entities
D. fair dealing
C. seeking legal and professional advice
2. In deprived area, what would attract a
D. private parties creating mutual obliga-
business?
tions.
A. Availability of labour
B. Advice and Support 6. Which of the following location factors
would be the most important to a small
C. Goverment Grants mining business hoping to excavate gold
D. Cost of stock from a new site?
3. A voidable contract A. Materials
A. has one or more of the contracts miss- B. The market
ing. C. Customer
B. must be set aside D. Competitors
C. the one whose conclusion was faulty
7. What is a major advantage of a business
D. All of the above
that is a partnership rather than a sole pro-
4. The does not relate to the purpose of prietorship?
the contract and it causes problems when A. The responsibility of the business is
contract is concluded. shared equally
A. supervening impossibility B. The partners are not responsible for
B. legal impossibility business debts
C. initial impossibility of performance C. The business is easy to set up
D. All of the above D. The business is easy to sell
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.12 Legal Aspects of Business 872
8. What is/are the characteristic(s) of a com- 13. Partnership may be dissolved in following
pany? manner, EXCEPT:
A. Separate legal entity A. by operation of law
B. Limited liability B. by court order
C. Maximum 20 members C. by breach
D. Dissolved by winding up D. by death or bankruptcy
14. Law firms, medical practices, and auto
NARAYAN CHANGDER
9. Keeping large, smoke producing factories
away from residential neighbourhoods are body repair shops are examples of what
type of ownership?
A. Sole proprietorship
A. licensing requirements
B. Franchise
B. signs
C. Partnership
C. building safety
D. Corporation
D. zoning
15. Suggest TWO factors that would attract
10. Animus contratendi is the clients to a business
A. ability of parties to perform in a con- A. Fair/just
tract.
B. Reliable
B. serious intention to create legally en-
C. Marketing Plan
forceable obligations.
D. entrepreneurship
C. obligations to be met in a legally en-
forceable agreement. 16. Partners who are only responsible up to
D. All of the above the extent of their investment
A. limited partnership
11. refers to the laws of countries other
B. trading partnership
than South Africa.
C. non-trading partnership
A. International law
D. special partnership
B. Foreign law
17. Select all effects of incorporation.
C. Private law
A. company able to sue and being sued
D. All of the above
B. company becomes a body corporate
12. v Function of the space.v Number of peo- C. company able to acquire, own, hold,
ple that will be in the space.v Location and develop and dispose any property
size of building features like rooms, walls,
floors, stairways, and plumbing and light D. company enjoys perpetual succession
fixtures.3. Government will look at three 18. In Mncube v Transnet, it was held that a
factors to required contract can be concluded via
A. building permit A. email
B. certificate B. sms
C. contraction C. click wrap online
D. safety D. letter
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.12 Legal Aspects of Business 873
19. Once you complete your building or ren- 24. It is owned by one entrepreneur and some-
ovations, your premises may have to be times, the owner may employ a worker for
inspected by the local government before assistance. This refers to
PRACTICE BOOK» NOT FOR SALE
you can be issued a of occupancy, mak- A. Sole proprietorships
ing it legal for you to begin doing business.
B. Partnership
A. location
C. Public company
B. certificate D. Private company
C. checking
25. Outline TWO ways in which governments
D. inspecting can regulate business activity.
A. rules/Legislations for health and
20. The final South African constitution came
Safety at work
into being in
B. Ensure fair wages for the employee
A. 1990
C. rules that we all must follow or face
B. 1994 penalties
C. 1996 D. monetary policy
D. 2000 26. Most expensive to start
21. The process of dispute resolution that A. Sole Proprietorship
leads to a settlement agreement is B. Partnership
A. conciliation C. Corporation
B. mediation D. none of above
C. arbitration 27. What is the maximum number of partners
is partnership?
D. all of the above
A. 25
22. The owners of a corporation are called B. 30
A. Directors C. 20
B. Shareholders D. 35
C. Partners 28. A is one which cannot be enforced be-
D. Founders cause of some technical defects.
A. Void Contract
23. The Food Standards Agency B. Illegal Contract
A. is a body which checks if there is meat C. Unenforceable Contract
in food
D. Voidable Contract
B. is a body which checks food packaging
only 29. What is an example of a contract?
A. Employment contract
C. is a body which gives star ratings for
the taste of food B. Sales contract
D. is a body which sets the standards re- C. Rental contract
quired in the production of food. D. All of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.12 Legal Aspects of Business 874
30. An agreement between two parties that 36. Lifting corporate veil is
creates an obligation is a(n)
A. a principle that will protect members
A. Contract and officers from being liable to debts and
B. Tort obligations of the company.
C. Offer B. an action where the separation of the
company from its members is no longer
D. Purpose
available
NARAYAN CHANGDER
31. A business run by 2-20 people and has un- C. contents in Constitution that inconsis-
limited liability is known as a: tent with Companies Act 2016
A. Company D. none of above
B. Sole trader
37. A partnership in which all partners assume
C. Partnership full personal liability for debts of the firm
D. none of above
A. limited partnership
32. The aspect of male primogeniture and the B. trading partnership
unfair treatment of women emanates from
C. non-trading partnership
A. customary law D. general partnership
B. constitutional law 38. An omission in a contracts affects
C. common law A. consensus
D. municipal law B. certainty
33. Which of the following is not one of the C. contractual capacity
ways to terminate an offer?
D. All of the above
A. revocation
B. rejection 39. Which essential of valid offer is missing in
the example-A says to B “I will sell you a
C. counteroffer car”?
D. All are ways to terminate an offer A. Offer may be express
34. Punitive damages are also called as B. The terms of an offer must be clear
A. extraordinary damages C. The offer must be communicated to of-
B. extreme damages feree
C. exceptional damages D. An offer must be made with an inten-
tion to create legal obligations
D. exemplary damages
35. Shortest lifespan 40. A baby
A. Sole Proprietorship A. has no contractual capacity
B. Partnership B. full contractual capacity
C. Corporation C. limited contractual capacity
D. none of above D. partial contractual capacity
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.12 Legal Aspects of Business 875
41. The Government Gazette is 47. identify the TWO types of contracts
A. part of the legislative process. A. Simple
PRACTICE BOOK» NOT FOR SALE
B. a secondary source of law. B. complex
C. primary source of law. C. specialty
D. none of of the above. D. order
42. A promise to give Rs.5000 per month 48. A limited company is owned by
pocket money to son B. If A doesnot give
A. 1 person
the pocket money
B. Shareholders
A. B can sue his father
B. B has no remedy against A C. 2 or more people
C. B can accept a lower pocket money D. A family
also 49. The requirement to a valid contract that
D. B has to give Rs 5000 to his father deals with a person’s mental state is
43. Refers to the number of people who pass a A. legality
retail location during a given period time. B. possibility and performance
A. Traffic C. contractual capacity
B. Passage D. None of the above
C. Movement
50. Which of the following is a disadvantage
D. Patronage of corporations:
44. Ownership represented by stock A. High taxes
A. Sole Proprietorship B. Unlimited life
B. Partnership C. Unlimited liability
C. Corporation D. financial power
D. none of above 51. State THREE functions of the general man-
45. In Malaysia, how many types of Business age
Entities? A. Planning
A. 2 B. Controlling
B. 3 C. Decision-making
C. 4 D. selling
D. 5
52. Which of the following determines the ju-
46. An entrepreneur is who risdiction of a court?
A. enforces government regulations A. Residence
B. takes the risk to earn profit B. Financial means
C. sets the interest rates at banks C. Constitution
D. manages financial investments D. All of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.12 Legal Aspects of Business 876
53. When the partners mutually agreed to dis- B. mediation
solve the partnership, it will be dissolved C. arbitration
by
D. None of the above
A. operation of law
B. revocation 59. mark which statement is true?
C. agreement A. all agreements are contracts
D. supervening illegality B. all contracts are agreements
NARAYAN CHANGDER
54. v The environmentv Societyv The econ- C. all agreements are legal
omy5 is a broad discipline, but from a D. all agreements are not illegal
business standpoint, includes in this three
elements: 60. The period of limitation for exercising right
to recover a debt is
A. renovating
B. sustainability A. 5 years
C. developing B. 3 years
D. building C. 9 years
D. 12 years
55. What do have to consider when choosing
a location for your retail business? 61. The principle of corporate veil separates
A. zoning rules
B. being convenient for where your cus- A. the company with creditors
tomers are B. the company from people behind it
C. parking lot availability C. the creditors with shareholders
D. all the answers above D. none of above
56. Quantum meruit literally translates to
62. Businesses in Malaysia are required to ap-
A. as much is earned ply for business premise and signboard
B. as much is rewarded licenses from the respective State Author-
ities.
C. as much is agreed
A. signage
D. as much is real
B. certificate
57. The rights that one person can enforce
against the whole world are C. licenses
A. property rights D. halal
B. real rights 63. Which of the following is not 1 of the 6
C. personal rights elements of a contract?
D. None of the above A. capacity
B. consideration
58. Parties to a labour dispute are advised to
undergo C. valid
A. conciliation D. genuine agreement
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.12 Legal Aspects of Business 877
64. One of the advantages of a sole trader C. Executed contract
business is that
D. Executory contract
PRACTICE BOOK» NOT FOR SALE
A. owners have limited liability
B. decisions and responsibilities can be 70. The High Court hears cases
shared A. both civil and criminal
C. shares can be sold to raise capital B. only criminal
D. the owner has complete control over C. only civil
decision making
D. None of the above
65. A case between two private citizens is a
71. A company is a
A. judicial case A. sole proprietorship
B. civil case B. corporation
C. criminal case C. partnership
D. None of the above D. business option
66. How can an acceptance to an offer be
made? 72. .... is how governments regulate the use
of land and property.
A. Written words
A. building
B. Spoken words
B. choosing
C. Conduct
D. All of these C. positioning
D. zoning
67. What is the first element of a contract?
A. Consideration 73. Choose the statement which is TRUE from
B. Acceptance the below:
C. Capacity A. a partnership may be formed orally or
in writing
D. Offer
B. there is no legal relationship between
68. A contract that contains a promise by both partners in a firm
parties is
C. a company can be established orally or
A. expressed in writing
B. implied D. a company may be dissolved informally
C. bilateral
74. This element refers to someones mental
D. unilateral
ability to enter into an contract.
69. is a contract to do or not to do some- A. consideration
thing if some event, collateral to such con-
tract does or does not happen B. legality
A. Contingent contract C. capacity
B. Future contract D. genuine agreement
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.12 Legal Aspects of Business 878
75. What is a company? 80. what is capital intensive production?
A. A business own by individual A. business processes or industries that
B. A legal entity separate from its mem- require large amounts of investment to
ber produce a good or service
C. 2 or more persons doing business with B. when products are mainly produced by
a view of profit human workers .
D. none of above C. Machines and special tools are used to
NARAYAN CHANGDER
create products.
76. .... is also frequently used to designate D. human creativity
the types of buildings that can be erected
in a particular area. 81. The ‘location decision’ for a business
means:
A. building
A. deciding where the departments of a
B. licensing
business are located
C. safety
B. deciding where a business is going to
D. zoning operate from
77. What would the following be consid- C. an owner deciding on the positions for
ered:Black Friday Deal Sony 60” Flat products in the shop
screen TV $499 (10 at each store) D. deciding where a business is going to
A. offer market its products.
B. invitation to negotiate 82. Developing countries are attractive loca-
C. neither tions to place business because
D. none of above A. They industrialize faster than devel-
oped countries
78. Which of the following business is most B. Labor and resources are affordable
likely to locate close the market?
C. There is a high population
A. A manufacturer of high performance
sports cars D. All of the above
B. A small chocolate producer 83. An agreement not enforceable by law is
C. An internet book store A. Valid Agreement
D. A clothes retailer with a national chain B. Void Agreement
stores
C. Voidable Agreement
79. Which of the following is likely to be the D. Illegal Agreement
main factor influencing the location of a
small barber shop? 84. This act covers purchase4s made over the
internet, phone and by mail order.
A. Labour
A. The Consumer Protection (Distance
B. Customers Selling) Regulations 2009
C. Raw materials B. The Consumer Protection (Distance
D. Competitors Selling) Regulations 2000
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.12 Legal Aspects of Business 879
C. The Consumer Protection (Distance 90. The case of Executive Council of the West-
Selling) Regulations 2016 ern Cape Legislature and Others v Presi-
dent of the Republic of South Africa em-
PRACTICE BOOK» NOT FOR SALE
D. The Consumer Protection (Distance
Selling) Regulations 2003 phasized the importance of
A. the protection of human dignity in
85. The principle that states a company is democratic societies.
a person separate from its members is
known as B. separation of powers.
A. bona fidei C. respecting legislation in a democratic
society.
B. separate legal entity
D. All of the above
C. utmost good faith
D. caveat emptor 91. Breach of contract includes
86. What is the current (April 2016) National A. Real and virtual breach
minimum wage for 18-20 year olds? B. Actual and real breach
A. £5.75 C. Actual and anticipatory breach
B. £5.55 D. Anticipatory and Participatory breach
C. £5.35
92. Which of the following is not an essential
D. £5.95
element of a valid contract?
87. select THREE examples of (i) Market struc- A. Offer and acceptance
tures
B. Free consent and consideration
A. perfect competition
C. Lawful object
B. oligomony
D. Performance
C. monopoly
D. oligopoly 93. The Jafta v Ezemvelo KZN Wildlife case
confirms that a contract can be concluded
88. Which of the following court will never be via
a court of first instance?
A. an sms or email
A. High Court
B. the internet
B. Constitutional Court
C. letter
C. Supreme Court of Appeal
D. None of the above
D. Magistrates Court
89. state TWO Reasons why a feasibility 94. What type of business consists of two or
study is important more people?
A. To ascertain the viability /success rate A. Sole proprietorship
B. To identify Possible sources of finance B. Company
C. to use cash flow C. Partnership
D. to start a business D. Franchise
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.12 Legal Aspects of Business 880
95. Define partnership. 100. What is/are the effect(s) of company in-
A. The relation which subsists between corporation?
persons carrying on business in common A. Ability to own property
with a view of profit B. Ability to sue and be sued
B. The relation which subsists between C. Ability to incur its own liability
persons carrying on business
D. Not perpetual succession
C. The relation which subsists between
two persons carrying on business 101. The disadvantages of this business or-
NARAYAN CHANGDER
D. The relation which subsists between ganization include unlimited liability, diffi-
persons carrying on business in with a culty raising financial capital, difficulty at-
view of profit tracting qualified employees, and having a
limited life
96. Workers have the right to (how many) A. Sole Propriotorship
hours rest between working days
B. Partnership
A. 12
C. Corporation
B. 9
D. none of above
C. 10
D. 11 102. A contract that contravenes an Act of Par-
liament is
97. Joe is starting a small home-based con- A. a statutory illegality
sulting business. He possesses computer
knowledge but lacks marketing skills. The B. a common law illegality
form of business ownership that Joe might C. a contractual illegality
consider establishing is a(n) D. fraudulent
A. corporation
103. Offer and acceptance
B. sole proprietorship
A. there must be an offer made by one
C. monopoly party which is accepted by the other
D. general partnership. B. Signed, sealed
98. What is the essential component of a con- C. to create legal relations
sideration? D. none of above
A. Move at the desire of the promisor
104. Business location decisions are very im-
B. Must be real portant for all of the following reasons ex-
C. Must be lawful cept that:
D. All of these A. the location might affect the sales of a
product
99. What is the biggest risk of starting a new
business? B. the location might affect the legal form
of ownership.
A. Losing Money
C. the location might affect the costs of
B. Being Successful production
C. Making Money D. the location might affect the available
D. Failing supply of labour
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.12 Legal Aspects of Business 881
105. Municipal laws are referred to as 110. Not TRUE about Sole Proprietor?
A. common law A. Limited liability
PRACTICE BOOK» NOT FOR SALE
B. legislation B. Owner-operator business
C. customary law C. Owner receives profits and bear
D. None of the above losses
D. Unlimited liability
106. COSHH stands for
111. state THREE factors that determine the
A. Control of Substances Hazardous to
location of a business
Health
A. availability of raw materials and sup-
B. Control of Substances Hazardous to
plies
Heart
B. infrastructure
C. Control of Synthetics Hazardous to
Heart C. power and water
D. Control of Synthetics Hazardous to D. functional areas
Health E. concept
107. Who among the following is not disqual- 112. What type of business structure is owned
ified by law to enter into a contract? (1) by many people?
A Major Person (2) A Lunatic (3) Insol-
A. Company
vent person (4) Diplomatic Staff of foreign
state B. Sole proprietorship
A. 2 & 3 C. Partnership
B. 3 & 4 D. Firm
C. 1 & 4 113. Nike, Fashion Valet, and Google are ex-
D. 1 & 2 amples of
A. Partnership
108. A written or oral agreement between 2
parties that is enforceable by law. B. Sole proprietorship
A. Memo C. Company
B. Invoice D. Self business
C. Contract 114. The Subday Trading Act 1994 regulates
D. Requisition the activities for trading on Sundays. Busi-
nesses must
109. are municipal regulations that set A. Only trade for a maximum of 6 hours
standards for occupancy, construction, between 9am and 10pm
health, safety and the welfare of the pub-
lic. B. Only trade for a maximum of 6 hours
between 10am and 6pm
A. building codes
C. Only trade for a maximum of 6 hours
B. safety between 9am and 9pm
C. health D. Only trade for a maximum of 6 hours
D. zoning between 9am and 11pm
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 882
115. The should be clear and easy to read A. full contractual capacity
and not confusing
B. no contractual capacity
A. name of company
C. limited contractual capacity
B. name of brand
D. All of the above
C. signs words and graphic
D. writing 118. Unlimited Liability is when
116. The modes by which a contract can be dis- A. Those who own the business won’t
NARAYAN CHANGDER
charged includes lose money if it fails.
A. Discharge by Performance B. Those who work in the business will
have to contribute if it fails.
B. Discharge by Mutual Agreement
C. Those who own the business could
C. Discharge by Operation of Law
lose everything if it fails
D. All of these
D. The bank will save people if the busi-
117. A child under the age of seven has ness fails.
1.13 Income-tax Planning
1. As a young person, saving for your retire- 4. The is the cash you give to the dealer
ment is an example of a goal. to lower the principal amount of the car.
A. short-term A. warranty expense
B. medium-term B. interest amount
C. value-added C. down payment
D. long-term D. trade-in
2. Federal tax return mistakes can be 5. One of the first things you should do as
avoided by part of the financial planning process is to
A. begin searching for a better-paying
A. using the proper tax forms, tax tables,
job.
and correct filing status.
B. create a balance sheet and cash flow
B. signing the completed return.
statement.
C. filing online or mailing your return be-
C. develop financial goals.
fore the deadline.
D. purchase life insurance.
D. all of the above.
6. Document that list your valuables, when
3. Where is savings in your budget purchased and their present value
A. income A. expense record
B. savings B. personal values
C. expenses C. net worth
D. cash surplus D. personal property inventory
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 883
7. When is using a credit card to cover an 11. expenses are costs that vary in
emergency expense a good idea and won’t amounts and type, depending on the
cost you any interest? choices you make
PRACTICE BOOK» NOT FOR SALE
A. When you have a high enough credit A. fixed
limit to cover the emergency expense B. conditional
B. When you can pay off the balance in C. changing
full before the end of the month D. variable
C. When you have a low interest rate
12. income is the result of earnings from
D. When you can make the minimum pay- dividends, interest, and rent.
ments each month A. Investment
8. This is a tax-sheltered retirement plan in B. Earned
which people can annually invest earnings C. Tax-exempt
up to a certain amount; the funds are
D. Adjusted
taxed when they are withdrawn after age
59 1/2. 13. This tax is based upon the value of land
A. Social Security and buildings.
A. income tax
B. annuity
B. sales tax
C. pension
C. gift tax
D. individual retirement account
D. real estate property tax
9. Define long-term budget. 14. What is the first step in financial plan-
A. A budget from one year to five years in ning?
the future. A. Estimating income
B. Making future predictions about the B. Estimating expenses
budget based on current situations and C. Estimating income and expenses
trends.
D. Knowing your net worth
C. A budget that is based on several pos-
sible levels of sales activity, also known 15. A detailed plan of income and expenses ex-
as a variable budget. pected over a certain period of time, often
a month.
D. A formal one-year operating plan to
achieve the financial goals of an organiza- A. Budget
tion. B. Financial Plan
C. Taxonomy
10. Planning to finance higher education helps
people prepare for their financial future be- D. Investment
cause it teaches them about 16. Olivia has a bit of money saved and is
A. loans and interest. considering using it as a down payment
toward one of the following choices. If
B. savings accounts.
Olivia wants to only have good debt,
C. filing taxes which of the following should she avoid?
D. short-term goals. A. Car loan
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 884
B. Stock investment 22. At what age are you required to begin tak-
C. Home mortgage ing distributions from your Roth IRA?
D. College education A. 65
B. 59 1/2
17. Which of the following would be a per-
sonal asset? C. 70 1/2
A. your personal computer D. Never
B. your car payment
NARAYAN CHANGDER
23. This month Anthony’s take-home pay was
C. your home mortgage $1, 500. He also earned $20 interest on a
D. your college loan savings account. He spent $250 for rent,
$100 for groceries, and $300 for other ex-
18. Amounts spent for food, clothing, trans- penses. Anthony’s total cash inflows this
portation, and other living costs are called month totaled
cash what?
A. $850.
A. inflows
B. $870.
B. outflows
C. $1, 500.
C. fixed
D. $1, 520.
D. none of above
19. Which of the following is an example of 24. On taxes, this is an amount that reduces
unnecessary debt? taxable income.
A. Using a car loan to buy a used car A. fixed
B. Using a mortgage to purchase a home B. exemptions
C. Paying for entertainment with a credit C. liabilities
card D. none of above
D. Paying for education with student
loans 25. A payee is
20. A decrease in the value of an asset A. the person who says they will pay a
debt for someone else
A. Depreciation
B. the person who promises to pay the
B. Liabilities debt, loan or note
C. Appreciation
C. the co-signer
D. Scarcity
D. the person who write the loan
21. Lara received $900 in one paycheck. If she
follows the 50-30-20 method, how much 26. The employee knows exactly which day
money will she put toward her wants? 1. his/her paycheck will be deposited into
$900 2. $450 3. $270 4. $180 their depository institution account.
A. $900 A. Paycheck with attached paycheck stub
B. $450 B. Direct Deposit
C. $270 C. Payroll Card
D. $180 D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 885
27. A financial is a report that summarizes 32. Which of the following is a fixed ex-
your current financial condition and helps pense?
set a direction for your future financial ac- A. food
PRACTICE BOOK» NOT FOR SALE
tivities.
B. utilities
A. plan
C. clothing
B. budget
D. rent
C. statement
33. For developing country especially, govern-
D. record ment usually perform a very to get
28. Financial needs and financial wants both tourism started
A. are needed to survive A. Passive
B. cost money B. Active
C. Intermediate
C. are the same
D. none of above
D. none of the above
34. Which of the following is an asset
29. Which results are more likely for some-
one without personal finance skills? Select A. credit card account
three options. B. checking account
A. larger long-term credit or loan costs C. car loan
B. less preparation for emergencies D. all of these
C. fewer utility expenses 35. These expenses are costs that occur on a
D. simple long-term investment strate- regular basis.
gies A. variable
E. increased long-term challenges B. fixed
30. After Form P is completed, Form CP30 is is- C. estate
sued. Once a partner receives Form CP30, D. none of above
they will declare the partnership income
36. Your birth certificate and Social Security
and loss that is stated on their Form CP30
card would likely be contained in which cat-
onto their
egory of your financial records filing sys-
A. CP500 tem?
B. Form B A. money management records
C. Form P B. housing records
D. Form BE C. personal records
31. Stafford loans, Perkins loans, and Plus D. tax records
loans are all from the government. 37. What is a cash surplus
A. alternative loans A. credit card balance
B. federal loans B. when income exceeds expenses
C. scholarships C. when expenses exceeds income
D. grants D. when you are insolvent
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 886
38. A legally enforceable agreement between 44. Tax Planning is opted in the reference of
two or more people is called a(n) the following-
A. agreement A. Only Income Tax
B. promissory note B. Only Direct Tax
C. contract C. Direct & Indirect Tax both
D. consideration D. Central Taxes
39. Which of the following is NOT an objective
NARAYAN CHANGDER
45. What is NOT a reason you can take an
of tax planning? early withdrawal from your IRA without
A. To minimize income penalty?
B. To reduce tax payable A. Down payment on your first home
C. To minimize tax litigation B. To pay for higher education
D. To maximize relief C. To pay taxes owed to the IRS
40. A want is: D. To pay for unreimbursed medical ex-
penses
A. something essential for Living
B. an expense 46. This is a series of regular payments made
to a retired worker under an organized
C. Something important to an individual
plan.
D. something someone would like to
A. pension
havebut does not need to live.
B. outflows
41. A subsidized loan is when pays the in-
C. allowances
terest while you are in school, while an
unsubsidized loan is when pays the in- D. none of above
terest while you are in school.
47. The total amount of an employee’s earn-
A. the government; parents ings before deductions are taken out.
B. the borrower; parents A. Net pay
C. the borrower; the government B. Cash flow
D. the government; the borrower C. Net worth
42. IRA’s are D. Gross pay
A. Individual Retirement Accounts.
48. What are the four elements of a contract
B. Integrated Retirement Accounts. that makes it legally binding
C. Inflation Resistant Accounts. A. agreement, consideration, contractual
D. . Individual Retirement Authorities. capacity, legality
B. agreement, consolidation, legality, sol-
43. When you make a loan payment, your
vency
A. liabilities decrease.
C. adoration, consideration, equality,
B. net income increases. taxes
C. cash outflows decrease. D. agreement, value, signature, notariza-
D. net worth is unaffected. tion
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 887
49. What is considered to be “retirement” 54. Stevie earned $600 this week. She used
age, when it is acceptable to begin taking $100 toward paying off her credit card
IRA distributions without penalty? and $20 went into savings, for a total of
PRACTICE BOOK» NOT FOR SALE
A. 50 $120, which is 20% of her income. What
money managing system is she likely us-
B. 59 1/2 ing?
C. 65
A. Pay yourself first
D. 70 1/2
B. The 50-30-20 Method
50. Mr. Johnson received $1, 750 on his pay-
check for two weeks. He got $275 taken C. The Categories Method
out of his check for taxes and $125 for his D. Investing in stocks
health insurance. The amount he had left
is defined as his- 55. Alyssa has her first job at the local bakery.
A. Gross income After working for one week, she received
B. Net income her first paycheck. The total amount of
money she is able to put in the bank is
C. Income tax $75.62. What type of income does this
D. Property tax amount describe?
51. Which one of the following is NOT a A. Gross Income
mandatory withholding from your gross
B. Net Income
pay?
A. Medicare/Medicaid C. Both Gross and Net Income
B. Union Dues D. None of the above
C. Social Security
56. Which of the following is NOT a need?
D. Federal Tax
A. Food
52. The difference between your personal as-
sets and your personal liabilities is your B. Clothes
A. cash inflow C. Netflix
B. net worth D. Shelther
C. cash outflow
D. net income 57. You never know what’s going to happen in
life, no matter how hard you plan. Luckily,
53. Take-home pay is there are insurance companies available to
A. the amount of a paycheck before taxes try to take some of the pain out of the dis-
and other payroll deductions. asters that befall all of us at some time or
other
B. the money you have available to spend
as a result of working plus any other in- A. Risk Management
come, such as a gift or stock dividend.
B. Financial Planning
C. the amount you will receive when you
cash your paycheck. C. Retirement Planning
D. cash inflows minus cash outflows. D. Budget
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 888
58. If you worked 40 hours per week at $10 C. long-term cost.
per hour, what is your gross income for D. opportunity cost
the week?
A. $227 64. Which of the following obligations are re-
quired to be settled prior to the distribu-
B. $4000 tion of estate? I. Burial/ Funeral expens-
C. $40 esII. Settlement of debtsIII. Execution of
WasiyyahIV. Distribution of Estate under
D. $400
NARAYAN CHANGDER
Faraid
59. Deductions are also known as ? A. I and II
A. withdrawals B. I, II, and III
B. Withholdings C. II and III
C. Subtractions D. All the above
D. None of the above
65. A value is:
60. The total amount of money earned before A. Something essential for living
withholdings B. an expense
A. net pay C. a belief about ideas and principles that
B. gross pay are important to you.
C. payroll deductions D. something you would like to have but
D. none of these do not need to live
61. A unit rate used to compare prices. 66. Choose the “Unexpected Expense”
A. Groceries each week
A. unit price
B. Storm damage repairs
B. percent decrease
C. School clothes
C. sales tax
D. Netflix subscription bill
D. income
67. What percentage of your income should
62. Net income is:
you use towards savings?
A. the total amount of money you earn
A. 80%
B. the amount of money you receive af-
B. 50%
ter deductions are subtracted from your
gross income C. 30%
C. the amount of money that is taken D. 20%
away in the form of taxes
68. A goal to save money for a new saxo-
D. the hourly rate of pay phone is
63. When studying finance or economics, the A. measurable
cost of a decision is also known as a(n) B. attainable
A. personal cost. C. time-based
B. long-term cost. D. specific
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 889
69. What does IRS stand for? 75. A is a plan in which an individual bal-
A. Income ready standards ances available resources and expenses.
PRACTICE BOOK» NOT FOR SALE
A. budget
B. Income research service
B. income
C. Internet resource service
C. risk
D. Internal revenue service
D. none of above
70. How long do you keep pay stubs?
76. To encourage development of a national
A. 3 months identity and promote a culture of national
B. Until 2 years past employment pride through tourism. This statement re-
fer to
C. Until you verified your bank statement
A. Regional Tourism policy
D. Until you verified your W-2
B. National Tourism policy
71. A tax on gasoline is known as a(n) C. International tourism policy
A. estate tax. D. tourism policy
B. excise tax. 77. What is Net income?
C. gift tax. A. Income before taxes
D. income tax. B. Income after taxes
72. An example of a variable (flexible) ex- C. Income that is not taxed
pense is D. State taxes
A. Car Insurance 78. Items of value, such as bank accounts, jew-
B. Rent elry, and automobiles.
C. Entertainment A. personal assets
D. Student loan payment B. net income
C. pension
73. This type of income is the result of earn-
ings from dividends, interest, and rent. D. none of above
A. surplus 79. What can help you be prepared for unex-
pected costs, such as car repairs?
B. pension
A. Short-term financial goal
C. investment
B. An emergency fund
D. none of above
C. Long-term financial goal
74. By understanding tax laws, you can make D. Retirement savings
sure you don’t pay more than you have to
80. Which of these is the best example of an
A. Investment
asset?
B. Tax Planning
A. the electricity in a home
C. Budget B. the antique diamond necklace some-
D. Financial Plan one is wearing
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 890
C. the coffee someone drank this morn- C. To determine your credit card debt
ing D. To determine your net worth
D. an old, used airline ticket
87. This is money you can get to pay for col-
81. Which of the following is an example of a lege, which has to be paid back.
defined contribution benefit plan? A. Scholarhip
A. 401k B. Grant
B. IRA
NARAYAN CHANGDER
C. Student Loan
C. Pension D. College Savings
D. none of above
88. Which of the following is an example of a
82. Which of the following is known as pur- defined benefit retirement plan?
chasing an item on a whim? A. 401k
A. Impulse B. IRA
B. Fixed C. Pension
C. Flexible D. none of above
D. Online purchase
89. A good first step in financial planning
83. Choose the “Fixed Expense”. would be to
A. Mortgage payment A. hire a professional financial planner
B. Groceries B. create a balance sheet and cash flow
statement
C. Electric bill
C. pay off all of your debts
D. Clothing
D. develop long-term financial goals
84. What kind of expenses are costs that occur
on a regular basis? 90. Sometimes people run low on money dur-
ing retirement. Which of the following
A. surplus should you do first?
B. variance A. Sell your house and move into an apart-
C. fixed ment.
D. none of above B. Rethink your retirement goals and
lifestyle.
85. Which of the following is a need?
C. Find a job to increase your income.
A. Shelter
D. Invest in stocks because they have a
B. Designer Clothes higher rate of return.
C. TV
91. Assets minus liabilities
D. Cell Phone
A. net worthy
86. What is the purpose of a balance sheet? B. network
A. To determine your budget C. net worth
B. To determine your income D. personal property
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 891
92. Tax Planning is medium of reducing tax- C. mortgage payment
A. Legal way D. insurance premium
PRACTICE BOOK» NOT FOR SALE
B. Moral Way
98. When one person makes an offer and an-
C. Wise way other person changes it, the second person
D. All of the above is
93. This is the form you must fill out before A. committing fraud
going to college in order to get aid from B. providing considerations
the government to pay for college
C. entering into an agreement
A. FAFSA
D. making a counteroffer
B. FASAF
C. FASFA 99. Tax planning is adopted by-
D. AFSAF A. Income tax payers
94. What is study preparation in tourism plan- B. Investors
ning process? C. Industrialists
A. Decision by government to prepare D. All the above
tourism plan
B. Projection of employees 100. A federal student loan is provided by
C. Adoption of plan A. Private companies
D. Determination of preliminary objec- B. The state you live in
tives
C. US Federal government
95. A spending and saving plan
D. Investors
A. budget
B. financial plan 101. A period of time during which repayment
of the principal and interest of your loan is
C. financial saving plan temporarily delayed.
D. IRA A. Deferment
96. Take-home pay is the amount you have left B. Forbearance
in your paycheck
C. Consolidate
A. after you pay your bills for the week
D. none of above
B. after taxes and deductions
C. before taxes and deductions 102. The total amount of money an individual
has earned before taxes are taken out.
D. before you pay your bills for the week
A. Net Income
97. Which of the following is a variable ex-
pense? B. Checking Account
A. rent C. Gross Income
B. groceries D. Overdraft
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 892
103. The amount on which taxes are calculated 109. Net worth is the difference between:
after adjustments, deductions, and exemp-
A. Assets and interest
tions.
A. taxable income B. liabilities and growth
B. surplus C. assets and liabilities
C. net income D. growth and investments
D. none of above
NARAYAN CHANGDER
110. What a person finds important and valu-
104. At the beginning of the year, Coach able, often in a moral sense.
Brewer told us to
A. Want
A. Care & Try
B. Never miss a day of class B. Needs
C. Make sure you do your homework ev- C. Values
ery day
D. none of above
D. none of above
105. A time-based savings goal describes 111. Most IRAs are invested in
A. what the money needs to be saved for A. stocks.
B. why the money needs to be saved B. bonds.
C. when the money will be saved C. gold and silver.
D. how much money needs to be saved
D. mutual funds.
106. What is a tax bracket?
112. those things that you own
A. The rate at which income is taxed
B. The rate of sales tax in a state A. Budget
C. The form used to file taxes B. Gold
D. The way taxes are calculated C. Asset
107. In a balanced budget, D. Investment
A. gross income = disposable income
113. Joanne’s dad makes $54, 000 every
B. expenses-savings = gross income
year. This is the amount of money he
C. expenses = savings makes before taxes, insurance and other
D. expenses + savings = earnings + deductions are taken out of his paychecks.
borrowing The amount of money he makes before
these items are taken out is called his-
108. Which one is a fixed expense
A. Gross income
A. Snacks
B. Net income
B. Rent
C. Entertainment C. Income tax
D. Gifts D. Property tax
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 893
114. How do long-term goals differ from B. Wants
short-term goals? C. Risks
PRACTICE BOOK» NOT FOR SALE
A. Long-term goals require more money D. Assets
than short-term goals.
B. Long-term goals require more prepa- 120. An individual or firm that advises clients
ration than short-term goals. on investment matters on a professional
basis.
C. Long-term goals are less attainable
than short-term goals. A. Investment Advisor
D. Long-term goals take longer to plan B. Insurance Agent
than short-term goals. C. Financial Advisor
115. Which of the following is known as D. Banker
expenses that are not absolutely neces-
121. Making plans which are permissible un-
sary?
der various provisions of the law is con-
A. Gross sidered as
B. Net A. Purposive tax planning method
C. Discretionary B. Permissive tax planning method
D. Credentials C. Short-term tax planning method
116. When should you fill out a W-4? D. none of above
A. When you quit a job 122. Which of the following describe to put in
B. When you have 401K benefits long-term storage?
C. When you start a new job A. discretionary
D. Whenever you feel like it B. variable expense
C. archive
117. Something of value exchanged for some-
thing else of value is called D. safe deposit box
A. contration 123. The IRS has the legal right to audit your
B. negotiable tax returns and supporting records for
C. warranty years from the date of filing
D. consideration A. 2
B. 4
118. The cost of owning a car includes
C. 3
A. insurance
D. 10
B. repairs
C. gas 124. This planning involves the accumulation
and management of property during one’s
D. all of these lifetime and the distribution of one’s prop-
119. are items such as utilities, rent, and erty at death.
food-items that one can’t do without. A. tax
A. Needs B. pension
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 894
C. estate 130. Which type of tax planning methods that
is executed at the end of the year to re-
D. none of above
duce taxable income legally?
125. What is your teacher name? A. Long-term tax planning
A. Percilla Ross B. Permissive tax planning
B. Priscilla Ross C. Purposive tax planning
D. Short-term tax planning
C. Priciella Ross
NARAYAN CHANGDER
D. none of above 131. Setting financial goals is the step in
creating and using a budget.
126. STATE which of the 6 steps to financial A. first
goal planning is represented in this sce-
B. second
nario:“George is using the SMART Goals
acronym to plan out the future.” C. third
A. Determining Your Financial Situation D. final
B. Developing Your Goals 132. A measurable savings goal spells out
C. Identifying Your Options A. how much money needs to be saved
D. Evaluate Alternatives B. what the money needs to be saved for
C. why the money needs to be saved
E. Create and Use an Action Plan
D. when the money will be saved
127. Which of these is an expense
133. The risk that you have been tricked or
A. part time job salary deceived when making an investment is
B. savings called
C. cost of daily lunch A. market price risk.
B. financial risk.
D. birthday check
C. fraud risk.
128. What is an example of liabilities? D. inflation risk.
A. Credit card debt
134. The amount you place in an investment is
B. Paycheck called:
C. Savings account A. interest
D. Paid off house B. principal
C. rate
129. Gross income is:
D. time
A. the total amount of money you earn
135. If you find that your budget is falling
B. the amount of money you receive after short each months, what smart actions
decuctions are subtracted could you take?
C. the total amount of money you spend A. Pick up extra shifts at work
D. sales taxes on items you buy B. Pay less on your cell phone bill
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 895
C. Put everything on a credit card and 141. Objective of tax planning-
only pay the minimum amount due A. Avoidance of tax
PRACTICE BOOK» NOT FOR SALE
D. Use emergency savings B. Minimise of Tax liability
136. Money or debts you owe to others are C. Payment of tax on time
called D. Differment of tax
A. liabilities
142. This part of Social Security provides
B. debts death benefits to dependents of workers
C. assets who die.
D. money A. survivors insurance
B. retirement insurance
137. A balance what is a record of assets and
liabilities at a point in time. C. disability insurance
A. sheet D. unemployment insurance
B. liabilities 143. How can buying a house be considered
C. exemption “good debt”?
D. none of above A. It increases your net worth as it builds
equity
138. The potential risk that you will lose your B. It gives you a place to live for a long
money due to a company going bankrupt time
is called risk.
C. It is worth more than any other invest-
A. market ment
B. fraud D. It decreases in value over time
C. corporate
144. If you have a retirement account,
D. financial
A. you can access the funds at any time,
139. An example of a fixed expense is even though you pay a penalty to do so.
A. Groceries B. you cannot access the funds until you
officially retire.
B. Heat for your apartment
C. it is a good strategy to borrow fre-
C. Car payment quently from it.
D. Entertainment D. your opportunity cost for borrowing
from it is very low.
140. A allows students to work on or off
campus to earn money to help pay college 145. How many people are needed to have a
costs. contract
A. scholarship A. 1
B. grant B. minimum of 3
C. federal work study C. 2 or more
D. federal loan D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 896
146. In American society, which of these is an B. $2500
example of a want? C. $5000
A. food D. $6000
B. shoes
152. Which of the following is known as the
C. video games total amount of money you expect to earn
D. utility bills before taxes and deductions?
A. Net worth
NARAYAN CHANGDER
147. The amount of pay before all deductions
refers to B. Discretionary income
A. net pay C. Gross income
B. adjusted gross income D. Balance sheet
C. gross pay
153. A professional who analyzes a client’s
D. exemption pay overall financial situation and develops a
comprehensive plan that meets the client’s
148. Which document is used as proof of iden-
goals and objectives. Special certifications
tity?
are required in order to use the title of “fi-
A. Cancelled check nancial planner.”
B. Tax return A. Insurance Agent
C. Insurance policy B. Financial Planner
D. Passport C. Budget Analysis
149. What is gross income? D. Wealth Mangement
A. Income after taxes 154. Spending for goods and services beyond
B. Income before taxes the essentials like food, shelter, and cloth-
ing
C. Income that is tax free
A. discretionary spending
D. Income tax for the state
B. disposable income
150. Neither discourage nor encourage
C. unanticipated expense
tourism and adopts measures for the gen-
eral development process such as on air D. anticipated expense
traffic agreement and investment incen-
155. The following included in the scope of Tax
tives.
Planning-
A. Active
A. Investment Planning
B. Intermediate
B. Financial Management Planning
C. Passive
C. Individual Tax Planning
D. none of above
D. All the Above
151. What is the maximum amount you are al-
lowed to contribute to your IRA each year 156. What are Social Security taxes used for?
if you are 45 years old? A. Building schools
A. $1000 B. Unemployment compensation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 897
C. Income for retired and disabled peo- 162. -Nation’s retirement program, helps pro-
ple vide retirement income for elderly and
pays disability benefits
PRACTICE BOOK» NOT FOR SALE
D. Transfer payment
A. State Tax
157. A percent of the cost of an item, which is B. Social Security
charged by governments to raise money.
C. 401K
A. sales tax D. Federal Withholding
B. percent change
163. What is your school mascot
C. interest A. Bee
D. assetts B. Warsp
158. Three Rules of Financial Planning C. Hornet
D. none of above
A. Spend within your means
164. A(n) is the amount of money you plan
B. keep an eye on your money
to use for a certain budget category.
C. Put some money away for later A. Savings
D. All of the above B. Clothing
159. dividing up your assets into different C. Fixed expenses
categories-stocks, bonds, cash, real es- D. Allowance
tate, and so on-based on your financial
165. When purchasing a vehicle, the most im-
goals and tolerance of risk.
portant things to compare are
A. Budget A. colors & cost
B. Investment B. safety & color
C. Asset Allocation C. color
D. Gold D. safety & costs
166. Amounts spent for food, clothing, and
160. Medium of tax Planning-
other living costs.
A. Rebates A. cash outflows
B. Incentives B. pension
C. Deductions C. annuity
D. All the above D. none of above
161. What are 2 things consumers spend most 167. What is “devalorisation of capital”
of their money on? A. The process of getting investor
A. Food and Clothes B. The process by which the state subsi-
dies part of the cost of production
B. Housing and Transportation
C. The process of getting profit and loss
C. Insurance and Housing of the project
D. Transportation and Food D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 898
168. This type of development normally focus B. What are the alternatives?
on state or province, or perhaps an island
C. How will it affect my status in society?
group.
A. National planning
D. What is the likely return?
B. Regional planning
E. Is the risk worth the return?
C. International planing
D. Facility site planning 174. What are the main purposes of a budget?
NARAYAN CHANGDER
Select three options.
169. What is the amount of money you earn,
before taxes are taken out? A. to record past income and spending
A. Net Income B. to take out a student loan from the
bank
B. Gross Income
C. to plan future income and spending
C. Property Income
D. none of above D. to apply for a mortgage
E. to balance available resources and ex-
170. The total amount of money earned during penses
the pay period before deductions.
A. Take Home pay 175. A government tax imposed on individu-
B. Net Pay als or entities (taxpayers) that varies with
the income or profits (taxable income) of
C. Gross Pay the taxpayer.
D. FICA A. percent change
171. How many SDG’s are set by the UN? B. sales tax
A. 14 SDG C. income tax
B. 20 SDG D. liabilities
C. 17 SDG
176. What is the first step of the decision mak-
D. 12 SDG
ing process?
172. A person who creates and signs the A. Evaluating the decision
promissory note and agrees to pay it on
a certain date is called the B. Identify the decision
A. co-signer C. Identify resources
B. maker D. Identify options
C. payee
177. Which of the following would probably
D. negotiator be a short-term financial goal?
173. To assess the risk and return involved in A. going on a three-week cruise
a purchase decision, which practical ques-
B. buying a new luxury automobile
tions should a potential buyer ask? Select
three options. C. going to college
A. What can go wrong? D. purchasing a new CD
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 899
178. The amount of money left after all deduc- C. asset
tions have been taken from the gross pay D. collectible
earned in a pay period.
PRACTICE BOOK» NOT FOR SALE
A. Gross Pay 184. Which of the following should not be paid
for with an emergency savings fund?
B. Commission
A. Replacing a broken down transmission
C. Pay Rate
in your car
D. Net Pay
B. Getting a regular oil change to keep
179. A company sponsored plan where you de- your car running
termine how to invest your money is called C. Repairing your car after a fender ben-
a(n) der
A. annuity. D. A down payment for a new car after
B. IRA. your previous car was totaled
C. pension plan. 185. STATE which of the 6 steps to financial
D. 401(k) plan. goal planning is represented in this sce-
nario:“Mary schedules a meeting with a
180. Amounts owed to others is called what? financial adviser at E*Trade to discuss her
A. liabilities portfolio.”
B. assets A. Determining Your Financial Situation
C. investment B. Developing Your Goals
D. none of above C. Identifying Your Options
181. What is the greatest source of expendi- D. Evaluate Alternatives
ture for the federal government? E. Create and Use a Plan of Action
A. Defence
186. Three friends are all taking out loans.
B. Health Essie is taking out student loans for col-
C. Education lege, Jalin is taking out a car loan for a
new car, and Nicole is getting a mortgage
D. Social welfare
to buy a house. Which of the friends are
182. In tax avoidance- opening up good debt?
A. Not obey legal provision A. Essie and Jalin
B. Avail benefit of loopholes B. Jalin and Nicole
C. Misinterpretation of provisions C. Essie and Nicole
D. All the above D. Essie and Jalin
183. An item of value pledged as a guarantee 187. Cami Bartosz calculated that she owed
for payment of a loan which can be repos- taxes of $254 and had $278 withheld
sessed by the lender if the loan is not paid from her pay during the year. This would
back. result in
A. Collateral A. a refund of $278
B. Net worth B. a refund o $24
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 900
C. additional taxes owed of $254 193. Calculate the missing amount for
D. additional taxes owed of $24 C.Assets
A. $33, 000
188. A computer program that organizes data
in columns and rows and can perform cal- B. $62, 200
culations using the data is C. $73, 400
A. a database D. $20, 800
B. a schedule
NARAYAN CHANGDER
194. In the 50-30-20 budgeting method, sav-
C. a spreadsheet ing for emergency expenses would fall un-
D. a calculator der which category?
A. 50
189. The idea that you should put money into a
savings account as soon as you receive any B. 30
income and before you pay any expenses C. 20
or spend any money.
D. None; it’s part of pay yourself first
A. Personal financial planning
B. Saving for a rainy day 195. If you leave a company before the re-
quired minimum of years to retain your
C. Pay yourself first
pension, what happens to the money?
D. Plan ahead
A. You receive 1/2 of it when you leave
190. This insurance provides cash payments the company
for a limited time to individuals who are B. You receive 1/3 of it when you leave
out of work for a reason other than illness. the company
A. disability income insurance C. You receive all of the money and can
B. survivors insurance roll it into your new retirement plan
C. unemployment insurance D. You don’t receive any of the money
D. retirement insurance 196. The loss of an asset’s value over time is
191. Subject matter of Tax Planning is- called
A. Heads of Income A. depreciation
B. Deductions B. equalization
C. Investment options C. amoritization
D. All the above D. normalization
192. Most people plan to work 197. The two elements in budgeting and plan-
ning
A. more years than they actually do
A. income and net worth
B. until they are 60 years of age.
B. net worth and liabilities
C. only until they qualify for their com-
pany retirement. C. income and expenses
D. until they are fired or forced to retire. D. expenses and assets
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 901
198. A list of all of a person’s assets and lia- 203. A plan for future spending and saving,
bilities at a specific point in time. weighing estimated income against esti-
mated Expenses.
PRACTICE BOOK» NOT FOR SALE
A. Cash Flow
A. Gross Income
B. Balance Sheet
B. Debt
C. Asset
C. Expense
D. none of above
D. Budget
199. If you have an IRA, you are required to
204. STATE which of the 6 steps to financial
start drawing income from it at age
goal planning is represented in this sce-
A. 50. nario:“Craig decides it’s time to expand
B. 55. his newspaper by adding on new staff
members.”
C. 591/2.
A. Determining Your Financial Situation
D. 621/2.
B. Developing Your Goals
200. deciding where to put your precious earn- C. Identifying Your Options
ings. Money can go to living expenses, D. Evaluate Alternatives
savings, investments, and toward discre-
tionary purchases (like that new pair of E. Create and Use a Plan of Action
shoes!). 205. Before planning a budget, track income
A. Cash Mangement and expenses for
B. Budget A. 1 month
C. Investment B. 1-2 months
D. Financial Plan C. four to six months
D. one year
201. Which type of setting would have the
highest rent? 206. Your financial wants are the things you
need to maintain a certain
A. Rural Area
A. Short-term goal
B. Suburb
B. income bracket
C. Urban/Downtown Area
C. Standard of living
D. none of above
D. Long-term goal
202. In personal finance, one makes decisions 207. Which of the following is the greatest
based on needs vs. wants. What is con- source of revenue for the federal govern-
sidered a need? ment?
A. something one would like to have A. Company tax
B. something ones does not budget for B. Customs duty
C. something one can afford C. Income tax
D. something one cannot live without D. Goods and services tax
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 902
208. A budget only works if 214. A person’s taxes can be reduced by
A. You are willing to follow it A. exemptions
B. if someone else creates it B. a tax credit
C. your parents give you money C. donations to charitable organizations
D. none of above D. all are true
209. This is the amount of money you plan to 215. Which of the following defines frugal?
use for a certain budget category.
NARAYAN CHANGDER
A. An unplanned, spontaneous purchase
A. surplus
B. Not being wasteful
B. overflow
C. Awareness of one’s environment
C. allowance
D. none of above D. The ability to hold back one’s actions
210. This is an example of a “Financial Goal” 216. What does a person’s will list?
A. Graduating from college A. Financial goals
B. Becoming a teacher B. Types of insurance they have
C. Learning to play an instrument C. Retirement plans
D. Purchasing a new home D. Financial plan upon death
211. What is it called when you earn interest 217. The last step in the financial decision mak-
on both the money you deposit, plus any ing process is to
interest you earned previously?
A. Evaluate the decision, process, and
A. Financial goal outcome
B. Compound interest B. Consider all possible options
C. A savings account C. Never start the process
D. An emergency fund D. Identify the decision to be made
212. Which of the following is an expense that 218. A set of goals for spending, saving and
stays the same every month? investing
A. Rent
A. budget
B. Groceries
B. financial process
C. Electric
C. financial plan
D. Credit card
D. financial budget
213. A source of equity financiancing for small
business with exceptional growth poten- 219. This occurs when a family spends less
tial than they have budgeted for a month,
A. Angel A. outlflows
B. Venture Capital B. surplus
C. Financial Planner C. variance
D. none of above D. none of above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 903
220. If you have a budget, you should C. MC Hammer
A. learn how to plan for financial emer- D. none of above
PRACTICE BOOK» NOT FOR SALE
gencies.
225. What is not considered an advantage to
B. never buy anything on credit. owning a home?
C. be able to buy anything you want. A. Building equity
D. all of the above. B. Appreciation
221. Ali wants to buy a new laptop. He writes C. Maintenance costs
down a goal of saving $1, 200. What de- D. None of the above
tail is this goal missing?
226. The following are types of personal relief
A. It is not time-based
for resident individuals in tax calculation.I.
B. It is not realistic Purchase of booksII. Takaful/insurance
C. It is not attainable payment for medical benefitsIII. Medi-
cal expenses for parentsIV. Amount de-
D. It is not measurable posited in unit trust
222. This is our nation’s retirement program A. II and III
it helps provide retirement income for B. II, III, and IV
elderly and pays disability benefits
C. I, II, and III
A. State Tax
D. All the above
B. Social Security
C. 401K 227. A comprehensive strategy designed to
help individuals achieve specific financial
D. Federal Withholding goals and prepare for unexpected life chal-
lenges or events.
223. Underdevelopment can best be described
as A. Financial Plan
A. Lacking development because of B. Budget
colonisation C. Wealth Management
B. Being poor with widespread starvation D. Investment
C. Being under resourced as a result of
228. If actual spending is greater than planned
poor economic factors
spending, it is referred to as a
D. Not having enough money and technol-
A. surfeit.
ogy to use resources properly
B. liability.
224. This singer and songwriter in the early C. surplus..
1990s, reigned as America’s most popu-
lar rap artist. He had great success with D. deficit.
a megahit album, “Please Hammer, Don’t 229. Why is putting even a small amount
Hurt ‘Em, “ and a hit single, “U Can’t into savings from every paycheck a smart
Touch This.” money habit?
A. New Edition A. Because it allows you to pay all of your
B. Bobby Brown bills
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 904
B. Because even small amounts add up 235. The initial amount of money borrowed or
with interest saved.
C. So you will be prepared for every emer- A. principal
gency expense B. interest
D. Because it is a quick way to improve C. tax
your credit score
D. rate
230. “Put your money to work for you” 236. Which is a personal record
NARAYAN CHANGDER
A. Investment A. personal property inventory
B. Budget B. income and expense records
C. Financial Planner C. net worth statements, tax records, car
D. Gold titles, insurance polices
D. All of these
231. The risk is shared among all the takaful
participants is the best to define 237. What are the school colors
A. Risk sharing A. blue and gold
B. Risk management B. navy blue and white
C. Risk transfer C. carolina blue and white
D. Risk retention D. none of above
232. making sure that your financial affairs 238. Causes of tax evasion-
are in order when you die. A. Higher Tax rates
A. Estate Planning B. Complexities of provisions
B. Financial Advisor C. Corruption
C. Budget D. All the above
D. Wealth Management 239. Which of the following best describes a
budget?
233. Following are types of risk management
I. Risk avoidance II. Risk retention III. Risk A. A financial tool for consumers with lit-
sharing IV. Risk transfer tle money
A. I and II only B. A plan for saving and spending money
B. I, II and III C. A set of restrictions on how to spend
money
C. I, II and IV
D. A statement of your assets and liabili-
D. All the above ties
234. The standards used to determine what is 240. When renting a home, what term refers
important to a person. to the owner of the home?
A. Do unto others A. Boss
B. goals B. Coach
C. assets C. Tenant
D. values D. Landlord
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 905
241. Which of the following would be consid- 246. Which of the following is an example of
ered a variable expense good debt? 1. Student loan 2. Cash ad-
vance 3. Payday loan 4. Business loan
PRACTICE BOOK» NOT FOR SALE
A. utility bill
A. 1, 2, 3
B. rent
B. 3, 4
C. grocery bill
C. 2, 3
D. car loan
D. 1, 4
242. What is “Earned Income”? 247. Mateo wants to buy a new guitar and
A. A birthday gift amp that will cost about $2, 500. He
works part time at a cafe and brings
B. Winning the lottery home around $500 per week. He tells his
C. Unemployment compensation friends he plans to buy the guitar in about
two months. What detail of this goal is
D. Salary
missing?
243. When planning for retirement, you need A. It is not specific
to determine B. It is not measurable
A. how much money you need to live in a C. It is not realistic
nursing home or retirement center.
D. It is not time-based
B. how much money you want your chil-
dren to inherit. 248. Aims to promote safe, regular and eco-
nomical air transport, faster air commerce
C. how much money you will need and and study problems connected with the in-
how many years you will need it. dustry
D. where you plan to live after you quit A. IATA
working.
B. ICAO
244. Why do you need to keep a record of do- C. PTTA
nations to charity for? D. UNWTO
A. Legal proof 249. Which of the following is known as some-
B. Loan applications thing you own.
C. Tax purposes A. Liabilities
D. Medical reasons B. Assets
C. Net worth
245. Which federal loans are available for par-
D. Gross income
ents to take out for their children’s educa-
tion? 250. All of the following are ways to help min-
A. Perkins Loans imize depreciation except
A. it doesn’t matter what you do you
B. Direct PLUS Loans
cannot slow depreciation
C. Subsidized Direct Loans
B. buy cars that have manufacturer’s war-
D. Unsubsidized Direct Loans ranties that are still valid
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 906
C. keep the car maintenance up to date 255. When assets are greater than liabilities,
you are said to be
D. buy slightly used cars about 1-3 years
old A. rich
B. solvent
251. Elizabeth Eliting was a student at New
York University in when she decided C. insolvent
to start a company that would help other D. credit worthy
companies translate and publish materials
256. How do taxes affect your financial
NARAYAN CHANGDER
in various languages.
plans?
A. 1992
A. They create higher interest rates
B. 1994
B. They affect how much money you actu-
C. 1996 ally have to spend
D. none of above C. They make your saving account in-
crease
252. What does refinance mean?
D. They affect the GDP
A. A home loan in which the interest rate
changes depending on current rates in ef- 257. Which of the following is the key to be-
fort coming financially secure for the average
person?
B. To finance a home again with a new
loan & a new interest rate A. Making a large salary
B. inheriting money
C. An estimate of the value of the prop-
erty C. working multiple jobs
D. A loan which uses the equity in your D. starting to save or invest at an early
house to secure your loan age
253. Which of the following contracts must be 258. What is the main reason you should start
signed to be legally binding saving for retirement as early as possi-
ble?
A. contract involving sale of farmhouse
A. To ensure that you save enough money
B. an agreement to purchase a $50 MP3 to travel the world
Player
B. To give your money time to grow with
C. a promise that you will feed your neigh- compound interest
bor’s cat over the weekend C. So that you can enjoy your money while
D. all of these you’re young and able to spend it
D. So you have enough time to decide
254. What is a down payment? where you would like to retire
A. A sum of money that you pay at closing
259. Also known as take home pay, this is
B. Percentage earned of sale price the amount left after all payroll deductions
C. A loan which uses the equity in your have been taken from the gross income
house to secure you loan A. gross pay
D. none of above B. withholdings
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 907
C. net pay 265. . Wages, salary, commission, fees, tips,
D. real pay and bonuses are
PRACTICE BOOK» NOT FOR SALE
A. interest income.
260. Planning on saving enough money to go
on a nice vacation is an example of: B. tax-exempt income.
A. Need C. earned income.
B. investment D. tax-deferred income.
C. Financial Goal 266. The you start saving, the you will
D. Wealth have to save each month to reach your re-
tirement goals.
261. How does an increase in your income af-
A. earlier, more
fect your tax liability?
B. less, more
A. Your tax liability will decrease
B. Your tax liability will increase C. earlier, less
C. Your tax liability will be annulled D. later, less
D. Your tax liability will remain the same 267. What is another name for warranty
262. Maintaining and growing one’s finances. A. guarantee
Also refers to a professional service that B. implied
is the combination of financial/investment
advice, accounting/tax services, and le- C. express
gal/estate planning. D. limited
A. Financial Plan
268. What does it mean when a student loan
B. Budget is “forgiven”?
C. Wealth Management A. You get a letter of apology from the
D. Insurance Agent government
B. You don’t have to keep going to classes
263. Following are instruments used in Islamic
to get your degree
estate planning, EXCEPT
C. You don’t get as much money as your
A. Will
were previosuly promised
B. Sedeqah
D. You don’t have to pay back the remain-
C. Matrimonial asset der of your loan debt
D. Hibah
269. Aims to establish coordination of national
264. prepare ourselves for that time when we economies for the benefit of countries in
no longer can (or want) to work. the Asia-Pacific region
A. Risk Mangement A. OPEC
B. Estate Planning B. APEC
C. Retirement Planning C. CPEC
D. Wealth Management D. CTEC
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 908
270. What is a written promise to pay a cer- 275. Your net worth is
tain sum of money to another person or to A. the total value of your personal assets.
the holder of the note on a specified date
B. the difference between your personal
A. contract assets and your liabilities.
B. credit agreement C. the total amount of all of your invest-
C. promissory note ments.
D. title loan D. what you have left over in your pay-
NARAYAN CHANGDER
check each week after deductions are
271. The following are the conditions for za- taken out.
kat on saving, EXCEPT
276. What is the purpose of cash budget?
A. Hawl is one year
A. Determine whether the firm is facing
B. Based on the beginning balance shortage or surplus of asset.
C. Nisab 85 gram gold B. Determine whether the firm is facing
D. Zakat rate 2.5% shortage or surplus of cash.
C. To check whether the firm earn profit
272. Why is buying a car considered “bad
or get loss
debt”?
D. none of above
A. It increases your net worth as it build
equity 277. Which of the following can BEST help you
B. It gives you transportation to and from develop budget categories and provide a
your job basis for your budget?
C. It is worth more than any other invest- A. paycheck stub
ment B. balance sheet
D. It decreases in value over time C. cash flow statement
273. A personal balance sheet would report all D. cost benefit analysis
of the following EXCEPT 278. Your income is the money you have
A. net income left to spend or save after taxes and other
B. amount in your checking account deductions
C. value of your car A. gross income
B. net income or disposable income
D. home mortgage
C. loan payments
274. A person who is authorized by an insur-
D. social security
ance company to represent that company
in its dealings with applicants for insur- 279. It is an attached agency of DOT which
ance. is primarily responsible for implementing
A. Insurance Agent an integrated domestic and international
promotions and marketing program for the
B. Wealth Mangement
Philippines as a tourism destination as
C. Financial Advisor well as for tourism investments
D. Financial Planner A. Tourism Promotions Board
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 909
B. Tourism and Travel 285. Which one of the following events could
C. Tourism Industry make your retirement benefit LESS than
expected?
PRACTICE BOOK» NOT FOR SALE
D. Tourism Policy
A. Inflation occurs at a lower rate than
280. Paying down debts such as credit card you calculated.
balances is considered
B. Your rate of return is lower than you
A. part of your monthly needs.
had calculated.
B. part of your wants.
C. You earn a larger retirement benefit
C. part of your savings strategy
than you had calculated.
D. part of your investment plan.
D. You inherit money you had not antici-
281. Which of the following is known as con- pated.
ducting business with financial institutions
over the internet? 286. What is unwritten guarantee that exists
A. online banking by the nature of the product
B. gross income A. express warranty
C. net income B. implied warranty
D. financial planning
C. double guarantee
282. Paying yourself first, sticking to a bud-
D. extended warranty
get, pacing yourself, living within your
means, and knowing where your cash goes
287. All the following are examples of tax de-
are all
ductions EXCEPT
A. ways to afford everything you want
A. contributions to charitable organiza-
B. ways to balance expenses and savings
tions.
C. guaranteed to prepare you for every
expense B. certain medical expenses.
D. ensure that you are able to retire com- C. rent expense.
fortably
D. interest paid on a home mortgage or
283. These records are updated quickly and home equity loan.
easily
A. electronic record keeping 288. Why should you keep track of how much
money you spend on items like food, gas,
B. promissory notes and going out each week?
C. loan papers
A. So you can know where your cash goes
D. paper filing
B. So you can know when to use credit or
284. Which of these are income debit
A. Savings C. So you can be sure to save enough
B. Allowance money each month
C. cost of shirt D. So you can meet your savings mile-
D. car payment stones
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 910
289. The creation of incentives to encourage 294. What is an example of assets?
foreign investment refer to A. Paid off house
A. sponsoring research B. house mortgage
B. Marketing incentives C. credit card debt
C. Financial incentives D. student loans
D. none of above 295. Calculate the missing amount for BLiabil-
NARAYAN CHANGDER
ities
290. The increase in value of your investments
over a period of time is called: A. $7, 000
A. assets B. $1, 800
C. $3, 000
B. liabilities
D. $5, 200
C. financial planning
D. growth 296. Zoya’s friends invited her to go on a trip
abroad during summer vacation. She’s ex-
291. The total amount of money earned before cited to go and writes down a goal of
payroll withholdings saving enough money over the next five
months. What detail is this goal missing?
A. net pay
A. It is not measurable
B. gross pay
B. It is not attainable
C. payroll deductions C. It is not realistic
D. none of these D. It is not time-based
292. A(n) is a charge imposed by govern- 297. This month Anthony’s take-home pay
ment to fund public services. was $1, 500. He also earned $20 inter-
A. sales tax est on a savings account. He spent $250
for rent, $100 for groceries, and $300 for
B. tax other expenses. Anthony’s net cash flow
C. excise tax this month totaled
D. income tax A. $850.
B. $870.
293. How do short-term goals differ from C. $1, 500.
long-term goals?
D. $1, 520.
A. Short-term goals involve more plan-
ning than long-term goals. 298. A down payment, property tax, and
maintenance costs are all considerations
B. Short-term goals are more affordable
you need to make when
than long-term goals.
A. renting a home
C. Short-term goals cost more than long-
term goals in the long run. B. retiring
D. Short-term goals are more immediate C. buying a home
than long-term goals. D. investing in stocks
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 911
299. How the establishment of new company 304. Why do people invest when risk is in-
help to solve the issue of interest restric- volved?
tions?
PRACTICE BOOK» NOT FOR SALE
A. Because they do not understand that
A. No borrowing fully equity investing is risky.
B. Distribute as dividends B. Because the talk about risk is really
overstated; investing is a safe bet.
C. Shares lower than net worth
C. Because the potential to make money
D. Both share are acquire is greater than the risk of losing it.
300. Establish a relationship of trust with the D. Because they are greedy and believe
client 2.Gather client data and establish fi- they can beat the odds to become a mil-
nancial goals3.Analyze the datathese are lionaire.
the first 3 steps of 305. Someone who, individually or as a mem-
A. Code of Ethics ber of a company, operates an establish-
ment for the deposit or loan of money.
B. Financial Plan
A. Financial Planner
C. Income Investment
B. Banker
D. none of above
C. Loan Officer
301. If you are concerned about your invest- D. Insurance Agent
ment losing money instead of appreciating,
306. Which is a flexible expense
then you are worried about risk.
A. Rent
A. market
B. Mortgage
B. inflation
C. Car payment
C. fraud
D. Gasoline
D. financial
307. If you are looking to use good debt build
302. Which of these is not a term for someone equity, which of the following would you
living in a rented space? purchase?
A. Renter A. A boat
B. Tenant B. A car
C. A house
C. Homeowner
D. An RV
D. none of above
308. What is included in an individual’s per-
303. The competence or legal ability of a per- sonal assets? Select three options.
son to enter a contract is
A. number of dependents
A. consideration B. money
B. legality C. career
C. contractual capacity D. property
D. agreement E. investment
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 912
309. expenses are costs that do not C. taxable income
change from month to month. D. net income
A. variable
315. Which of the following is a characteristic
B. fixed of a Roth IRA?
C. conditional A. Money invested into a Roth is “after-
D. regular tax” dollars
B. Money is deposited into a Roth by your
NARAYAN CHANGDER
310. The amount of salary received after employer.
taxes and deductions
C. Money invested into a Roth is “before-
A. Gross Pay tax” dollars.
B. Net Pay D. Once money is deposited into a Roth
C. Total Earnings IRA, it cannot be taken out until retire-
ment.
D. Bill
316. When investing, the basic rule is this:The
311. A series of regular payments made to a GREATER the potential to gain higher earn-
retired worker under an organized plan. ings, the
A. pension A. higher the level of risk.
B. financial plan B. lower the level of risk.
C. personal assets C. greater the potential for fraud.
D. none of above D. less likely you are to invest.
312. Which of the following should an emer- 317. The financial planning process consists of
gency fund be used to pay for? steps
A. 5
A. Monthly bills
B. 6
B. new boat
C. 3
C. College classes
D. none of above
D. Car repairs
318. Reducing of tax liability by showing
313. What do financial planning skills ulti- lower income-
mately enable an individual to do? A. Tax Avoidance
A. to prepare for the future B. Tax Planning
B. to process their own tax returns C. Tax Evasion
C. to stop spending D. All of the above
D. to become wealthier without saving 319. Most experts recommend saving %
money of your disposal income each pay period
314. When preparing a budget, focus mostly A. 10
on you B. 20
A. gross income C. 30
B. disposable income D. 50
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 913
320. Those things that are basic and necessary 325. What type of organization will offer a
for a decent quality of life 403(c) as a retirement plan?
PRACTICE BOOK» NOT FOR SALE
A. want A. Private business
B. value B. Giant company
C. needs
C. Nonprofit/government
D. none of above
D. Airline
321. The BEST way to protect yourself from
fraud risk is to 326. Which budget is the best to create and
most accurate
A. invest only with reputable companies.
B. ask your friends for suggestions be- A. weekly
fore investing. B. bi-weekly
C. keep your money is a savings account C. monthly
at a local bank.
D. any of these
D. invest heavily in jewelry and gold.
322. There are four steps in solving one’s 327. What type of information is included on
personal financial challenges:1. consider- a 1040 form?
ing opportunity costs2. assessing risks A. Your financial projection
and returns3. setting short-and long-term
goals4. assessing needs and wantsWhich B. A list of all expenses
of these is the correct order of these C. Gross and net income from last year
steps?
D. Your bank statement from last year
A. 2, 1, 3, 4
B. 1, 2, 3, 4 328. A cash statement reports net wages
C. 4, 1, 2, 3 and other income along with spending for
a period, such as a month.
D. 4, 2, 3, 1
A. flow
323. Putting money to use that you hope will
B. outflows
increase its value over time is called:
A. Investing C. inflows
B. net worth D. none of above
C. average rate of return
329. What should all budgeting methods have
D. compound interest in common?
324. Personal finance skills have the most sig- A. Dividing net income by percentages
nificant impact on an individual’s B. Defining different classifications of ex-
A. career penses
B. education C. Putting money in savings for the future
C. quality of life D. Using credit cards wisely to build
D. neighborhood safety credit history
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.13 Income-tax Planning 914
330. Life expectancy refers to B. They are also called “Non-
A. Your perception of how long you ex- discretionary” expenses
pect to live. C. They are also called “Discretionary”
B. An estimate of how much money you expenses
need for retirement. D. They are usually fun to pay for
C. A statistical estimate of the number of 336. In India, in the accommodation sector the
years you will live in retirement. federal government now allows foreign
NARAYAN CHANGDER
D. A statistical measure of the average management and up to 51% foreign own-
life span of a specific population. ership of hotels. This example refers to
331. The Jeffersons want to save 10% per A. Tourism promotion
month from their $5, 000 salary. What B. Stimulation
will they save in a year?
C. Coordination
A. $500
D. Planning
B. $5500
337. A successful budget
C. $6, 000
A. should not need to be re-evaluated
D. $6, 250
once it is in place.
332. What is a home loan called? B. should never show any variances.
A. Mortgage C. should be flexible.
B. Personal Loan D. should reflect current and future in-
C. Car Loan come.
D. Above Rent Payments 338. The HIGHEST percentage of income for
people over age 65 comes from
333. How do most people purchase a home?
A. employment benefits.
A. In cash
B. retirement accounts.
B. Through a lease
C. Social Security.
C. With a down payment and a mortgage
loan D. other assets.
D. Building their own 339. The word means legally collectible
334. Two kinds of waqf has been determined A. consideration
which are B. contract
A. Individual waqf and group waqf C. negotiable
B. Family waqf and welfare waqf D. delegation
C. Perpetuity waqf and permanence waqf
340. Any difference between actual spending
D. Cash waqf and building waqf and budgeted amounts is called a budget
335. What is true about “Needs”? what?
A. They are items such as an expensive A. surplus
vehicle B. liability
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 915
C. variance gal heirs in a case of exceeding amount of
D. none of above the whole estate.
PRACTICE BOOK» NOT FOR SALE
D. Wasiyyah should be made in favour of
341. Which of the following statement is TRUE entitled legal heirs
about wasiyyah?
342. Peer pressure is also known as
A. Wasiyyah cannot exceed 1/3 over the
total estate. A. Civic consciousness
B. It is effective anytime as long as the B. Work ethic
owner agrees. C. The bandwagon effect
C. There is no need for consent of the le- D. Restraint
1.14 Personal Financial Planning
1. Nancy has a gross income of $47 000, dis- 5. You put $100 into a bank account. The
posable income of, a net worth of $80000 account will pay you 5% interest. How
and saves $8000 a year. Her savings rate much interest will you have earned at the
is end of the year?
A. 10 percent. A. $105.00
B. 15 percent. B. $5.00
C. 17 percent. C. $15.00
D. 20 percent.
D. $1, 005.00
2. Future Value computations are also called
6. This month Joshua has $2000 income from
A. Combining his job and $100 interest income. His ex-
B. Compounding penses are rent $500, food and entertain-
C. Confusion ment $400 and car expenses $600. He
has $40 000 held in bonds and a car loan
D. Composition
of $10 000. What is his cash flow this
3. Money spent on different items. month?
A. solvent A. $600
B. appreciation B. $500
C. expenses C. -$9400
D. insolvent D. $30 600
4. Money left over after taxes andother de-
7. Which of the following is not a right of a
ductions:money used to pay necessary ex-
stockholder of a listed company
penses.
A. Disposable income A. Vote in the general meeting
B. Discretionary spending B. Sell his stock in the stock market
C. Income C. Receive dividends
D. Expenses D. Elect directors
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 916
8. The main reason that people have money C. APA 7th Edition
problems is D. Bankrupt
A. that they didn’t go to college
14. The idea that you should remove money
B. that they have too many mouths to for savings purposes as soon as you re-
feed ceive any income
C. that they don’t get minimum wage A. Pay Yourself First
D. that they do not plan ahead how they
B. Direct Deposit
NARAYAN CHANGDER
will use their money
C. Budgeting
9. The price paid for the use of another’s
D. Personal Property
money.
A. Interest 15. What benefits do bond investment offer?
(1) Coupon payments(2) Bond apprecia-
B. Future value
tion(3) Tax allowance(4) Dividends
C. Present value
A. and (2) only
D. Liquidity
B. and (4) only
10. A tool for managing money to achieve C. , (2) and (4) only
short and long-term goals
D. , (3) and (4) only
A. personal property inventory
16. An increase in the value of an asset
B. net worth statement
A. depreciation
C. budget
B. appreciation
D. check book
C. solvent
11. Making extra mortgage payments does
which of the following? D. insolvent
A. Reduces the payment amount 17. George has total debts of $10 000, liquid
B. Reduces the length of the loan assets of $8000 and current liabilities of
$5000. His current ratio is
C. Increases total amount paid
A. 0.8.
D. Increases cash flow
B. 0.63.
12. Money paid regularly at a particular rate C. 6.3.
for the use of money lent.
D. 1.6.
A. liquidity
B. bank pyaments 18. The measure of money coming in and
money going out over a certain period of
C. debt time
D. interest A. Gross pay
13. What is our group name? B. net worth
A. Piggy Bank C. liquidity
B. Public Bank D. cash flow
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 917
19. What is the highest effective rate attain- 24. Which type of insurance did not mention in
able with a 12 percent nominal rate? this workshop?
PRACTICE BOOK» NOT FOR SALE
A. 12.85 percent A. General Insurance
B. 12.75 percent B. Medical Insurance
C. 12.65 percent C. Pet Insurance
D. 12.55 percent D. Life Insurance
20. Danny invests $124 090 in a fund and ex- 25. Major purchases that require time, plan-
pects to receive $10 000 per year, at the ning and extensive saving. Usually takes
end of each year, for the next 30 years. more than 5 years to achieve.
What is the approximate interest rate pro- A. short-term financial goal
vided on the annuity? B. intermediate financial goal
A. 8 percent C. long-term financial goal
B. 6 percent D. smart goal
C. 9 percent
26. A task that a person or a machine performs
D. 7 percent in exchange for something else.
21. You owe more than you own. A. Service
A. insolvent B. Favor for a good pal
B. solvent C. Good
C. cash flow D. Consumer
D. expenses 27. Which of the following is not one of the
closing costs in purchasing a home?
22. John earns $3000 monthly income and he
A. Appraisal fee
decides to set aside 10 percent as sav-
ings. In his savings, John wants to reserve B. Home inspection fee
20 percent in his emergency fund. What C. Prepaid property tax
amount would John accumulate in his emer-
D. Moving costs
gency fund annually?
A. $600 28. Money left over after taxes and other de-
ductions
B. $300
A. disposable income
C. $360
B. discretionary income
D. $720
C. anticipated income
23. You should save at least percent of D. unanticipated income
your income.
29. Which payment frequency, all else being
A. 5
equal, will generally save you the most in-
B. 10 terest over the life of your mortgage?
C. 15 A. Semi-monthly
D. 20 B. Biweekly
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 918
C. Accelerated biweekly 35. When dealing with credit cards it is impor-
D. Weekly tant to know your card’s
A. credit limit
30. Something that you would like to accom-
B. A.B. AND C
plish
C. annual percentage rate
A. value
D. payment due date
B. goal
NARAYAN CHANGDER
C. asset 36. The total earnings paid to an employee
after payroll taxes and other deductions.
D. budget
Also known as take-home pay.
31. Put aside at least % of your income A. net worth
for your savings
B. net pay
A. 5 C. gross pay
B. 10 D. wage
C. 20
37. Spending, saving, and investing to have
D. none of above the kind of life that you want and finan-
cial security can be achieved by
32. The total value of a person’s financial as-
sets minus their obligations (liabilities). A. personal financial planning
A. net pay B. paying interest
B. gross pay C. buying stock
C. net worth D. regulating inflation
D. cash flow 38. Which of the following is not an example
of a personal financial statement
33. Elijah budgeted $100 a month for enter-
tainment, but this month he only spent A. Bank Statement
$75. This is considered a B. Personal Budgets
A. budget deficit C. Cashflow Statements
B. budget surplus D. Ledger Statment
C. shortage
39. Items with special qualities that make
D. budget variance them more expensive than alternative
products
34. Long-term investment is better than short-
term investment because A. Luxury goods
A. lower risk than short-term investment B. Consumer goods
B. more effort demanding than short- C. Consumer wants
term investment D. Bargains
C. to have more money in own pocket 40. Arrange the following investment from the
D. more money earned in a short time most risky to the least risky:(1) Saving
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 919
deposits (2) Stocks (3) Term deposit (4) 45. Hazel needs to plan the mortgage amount
Bonds she can afford. How much would she need
to pay at the end of each month on a
PRACTICE BOOK» NOT FOR SALE
A. , (2), (3), (4)
mortgage of $200 000 at six percent in-
B. , (4), (1), (3) terest, calculated semi-annually and amor-
C. , (4), (3), (1) tized over 30 years?
D. , (2), (3), (1) A. $555
B. $1211
41. Spending money, time or items toward fu-
ture benefits for making more money is C. $1199
called D. $1190
A. borrowing 46. Things you want to accomplish.
B. paying off A. Goals
C. saving B. Values
D. investing C. Wants
42. Ben’s salary is $3000 per month, taxes D. Needs
are $500, fixed expenses are $1500 and
47. Expenses that are not paid every month
savings are $500. His disposable income
and cannot always be planned.
is
A. anticipated expenses
A. $1500.
B. unanticipated expenses
B. $3000.
C. disposable expenses
C. $2500.
D. discretionary expenses
D. $500.
48. Periodic review of the financial plan to
43. What is the first step in building a financial evaluate changing market conditions (i.e.
portfolio for yoourself economic conditions, taxes, interest rates
A. Estimate your income and expenses etc.)
B. Determine your current financial situa- A. Data Gathering
tion B. Financial Plan Recommendation
C. Decide what you want your job to be in C. Plan Monitoring
the future
D. Objective Setting
D. create a financial excel sheet
49. Which of the following is the negative im-
44. Expenses that are consistent and require pacts of financial crisis?
payment around the same time each month
A. Employee revenues affected
A. anticipated income
B. Price level of goods and services in-
B. unanticipated income crease
C. anticipated expenses C. Value of money decline
D. unanticipated expenses. D. All of the answer above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 920
50. Jeff has a $1000 salary and $100 divi- 55. Lee has assets valued at $5, 000 and lia-
dend income this month. This month Jeff bilities including student loan debt of $7,
has rent and utilities of $600 and he spent 000. What is Lee’s net worth?
$200 on groceries and $100 on clothing. A. $2, 000
What is his net cash flow this month?
B. $-2, 000
A. $500
C. $12, 000
B. $100
D. $-35, 000
NARAYAN CHANGDER
C. $200
D. $1100 56. What is the purpose of getting a pre-
approval certificate from a financial insti-
51. The lowest level of business activity oc- tution?
curs during which of the following phases
in the business cycle? A. To guarantee you a mortgage interest
rate valid for 30 days
A. Boom or expansion phase
B. To provide you with a guideline on how
B. Recession phase large a mortgage you can afford
C. Recovery phase
C. To guarantee funding so you can make
D. Contraction phase an offer on a house
52. A formalized report that summarizes your D. To guarantee you will be approved for
current financial situation, analyzes your a mortgage
financial needs, and recommends future fi-
57. Approximately how much would you need
nancial activities
to invest today, to receive $200 in ten
A. Balance Sheet years, if you received an annual interest
B. Cash Flow Statement rate of ten percent?
C. Budget A. $65
D. Financial plan B. $77
53. Having funds to buy things that require C. $87
money above what is normally allowed by D. $97
a budget. Short-term financial goals are
usually accomplished within a year. 58. Mary earns $3500 per month. After
payroll deductions from the government,
A. Short-term goal
Mary takes home 85 percent of her salary.
B. Long-term goal Mary wants to use a pay yourself first
C. Intermediate goal method and puts $330 into her savings ac-
count before spending anything and pays
D. mid-term goal
$200 towards her student loans. What is
54. A list of all of one’s personal property Mary’s saving rate?
A. Personal property inventory A. 9.4 percent
B. Bank statement B. 11.1 percent
C. Budget C. 15.1 percent
D. Income and expense inventory D. 17.8 percent
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 921
59. Saving money means giving up the oppor- 64. Cash and items that can be quickly con-
tunity cost to verted to cash.
PRACTICE BOOK» NOT FOR SALE
A. spend in the present A. Liquidity
B. have money in the future B. Solvent
C. apply for credit cards C. Insolvent
D. save money D. Assets
60. Which of the following is true regarding 65. How long will it take Ivy’s money to triple
conventional mortgages? in value at 12 percent compounded quar-
A. They require a down payment of at terly?
least twenty-five percent. A. 9.5 years
B. They require a down payment of at B. 9.7 years
least twenty percent.
C. 9.3 years
C. They receive more favourable interest
rates for the buyer. D. Not enough information
D. They are a form of closed mortgage. 66. Guides monetary policy
61. The correct order of the key components A. Federal Reserve (FED)
of a financial plan is B. Securities and Exchange Commission
A. budgeting, insurance, financing, in- (SEC)
vesting. C. Federal Deposit Insurance Corpora-
B. financing, insurance, budgeting, in- tion (FDIC)
vesting. D. National Credit Union Administration
C. budgeting, financing, insurance, in-
vesting. 67. This month Joshua has $2000 income from
his job and $100 interest income. His ex-
D. investing, financing, insurance, bud-
penses are rent $500, food and entertain-
geting.
ment $400, car expenses $600. He has
62. The ease with which an asset can be con- $40 000 held in bonds and a car loan of .
verted into cash without hurting its value. What is his net worth?
A. liquidity A. $600
B. cash flow B. $500
C. solvency C. -$9400
D. insolvency D. $30 600
63. What is the future value of $200 de- 68. Generally accepted finance principles
posited today at eight percent interest would support which of the following
compounded annually for three years? statements
A. $252 A. ‘High return generally equals high risk’
B. $250 B. ‘High return generally equals low risk’
C. $248 C. ‘High risk is generally inversely re-
D. $249 lated to high return’
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 922
D. D. ‘Low return generally equals high 74. What should be the first step in the home-
risk’ buying process?
69. The ability to easily convert financial as- A. Determine the price range for houses
sets into cash without loss of value. in your target area.
A. Liquidity B. Determine how much you can afford to
pay monthly for a mortgage.
B. Interest
C. Compare the costs of buying versus
C. Time value of money
NARAYAN CHANGDER
renting.
D. Annuity
D. Interview three realtors.
70. Anticipated expenses that may vary in
amount each month 75. The difference between the budgeted
amount and the actual amount that you
A. fixed expenses spend.
B. variable expenses A. budget surplus
C. anticipated expenses B. budget deficit
D. unanticipated expenses C. budget variance
71. Is it possible for someone with a positive D. balanced budget
net worth to get into financial problems?
Financial difficulties can occur when your 76. The values you want to accomplish
assets are not
A. Goods
A. liquid
B. Services
B. transfer
C. Money moves
C. freeze
D. Goals
D. none of above
77. You should NOT implement your budget
72. Nazar owns more than he owes. He is con- plan when
sidered
A. Expenses < Income
A. solvent
B. Expenses > Income
B. insolvent
C. Expenses = Income
C. liquid
D. fixed D. none of above
73. Financial products will be proposed. At 78. Money received for work or other sources
this point, the individual can comment on such as interest earned, child support, al-
the solutions proposed. imony, or dividends from stocks.
A. Data Gathering A. income
B. Financial Plan Recommendation B. net pay
C. Plan Monitoring C. gross pay
D. Objective Setting D. expenses
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 923
79. Debts, any outstanding bills or loans that 84. The present value of a single deposit is
must be repaid also known is
PRACTICE BOOK» NOT FOR SALE
A. liabilities A. What your deposit will be worth in the
future based upon an interest rate
B. assets
B. the amount of money you need to
C. income deposit now in order to have a certain
D. expenses amount in the future
C. The value your deposit will be worth if
80. Saving for a vacation next Summer or pay-
you deposit a series of regular, equal de-
ing off small debts by the end of the year
posits
are examples of
D. bread
A. opportunity costs
B. short-term goals 85. Saving money for less than 2 months is
C. long-term goals A. impossible
B. long term goal
D. personal financial planning
C. a short term goal
81. Having funds to buy things that require D. unrealistic
money above what is normally allowed by
a budget within a year. 86. What is lifestyle inflation?
A. short-term financial goal A. Income increase, spending decrease
B. long-term financial goal B. Income decrease, spending increase
C. intermediate financial goal C. Income increase, spending increase
D. smart goal D. none of above
82. The 3rd step in the financial planning pro- 87. This month Jill received $1000 income
cess is from her job and $200 in stock dividends.
Her expenses were rent and utilities of
A. Create a financial plan of action $300 and $300 on groceries and $200 on
B. Develop your financial Goals clothing. Which of the following is true?
C. Identify alternative courses of action A. Jill has a net cash flow of $400.
D. Evaluate your alternatives B. Jill has net expenses of $400.
C. Jill has a net cash flow of $200.
83. Opportunity cost represents
D. Jill has net income of $400.
A. short-versus long-term financial deci-
sions. 88. Quantifying monetary objectives with def-
inite time frames. Prioritizing objectives.
B. what you give up as a result of making
a decision. A. Data Analysis
C. the financial cost of any opportunity. B. Objective Setting
D. the non-financial cost of any opportu- C. Plan Monitoring
nity. D. Financial Plan Recommendation
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 924
89. How many months of expenses should you B. Rumour of the company being circu-
have saved in case of emergencies. lated
A. 6 C. Future plans announced by the com-
B. 12 pany’s leader
C. 18 D. Numbers of citizens playing Facebook
in Malaysia
D. 24
95. Using surveys, questionnaires and inter-
NARAYAN CHANGDER
90. What is the term for the interest rate fi- views to gather quantitative and qualita-
nancial institutions quote? tive information from the individual.
A. Nominal A. Data Gathering
B. Effective B. Financial Plan Recommendation
C. Annual C. Plan Monitoring
D. Real D. Objective Setting
91. The increase of an amount of money due 96. Your net worth is your
to earned interest or dividends.
A. total assets-total liabilities
A. Time value of money B. total liabilities-total assets
B. interest C. total liabilities + total assets
C. getting paper D. none of above
D. Liquidity
97. Personal financial planning requires that
92. Income that is consistent and is typi- you make choices and evaluate risks. If
cally received around the same time each you decide to wait until next year to buy
month. a car, one risk that you may face is
A. Anticipated income A. inflation rate risk
B. Unanticipated income B. the car color choice is unavailable
C. Anticipated expense C. the engine is old
D. Unanticipated expense D. personal risk
93. A person who purchases and uses goods 98. You will have a positive net worth if your
or services.
A. Shopper A. total assets less than total liabilities
B. Bank B. total liabilities more than total assets
C. Consumer C. total assets more than total liabilities
D. Lender D. none of above
94. Stated below are the factors causing the 99. The first step in the financial planning pro-
NESTLE stock price to move up and down, cess is to
except A. develop your financial goals
A. Performance of the company’s in the B. determine your current financial situa-
market tion
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 925
C. determine your needs and wants C. Expenditure continues, income contin-
D. count your money ues
PRACTICE BOOK» NOT FOR SALE
D. none of above
100. Arranging to spend, save, and invest
money. 105. Destiny has assets of $5, 000 and owes
$7, 500.
A. Personal Financial Planning
A. She has a high debt ratio and is not in
B. Interest
a good financial position.
C. Values
B. She has a low debt ratio and is in a
D. Goals good financial position.
101. Martina and Anton are attempting to C. She is solvent
qualify for total mortgage financing of D. She need to file for bankruptcy.
$1486, heating costs of $68, and they
have a car loan payment of $346. What 106. Money or other items of value that a per-
minimum gross monthly income will they son owns
need to qualify for both GDS ratio of 32 A. assets
percent and TDS ratio of 40 percent? B. liabilities
A. $5938 C. debts
B. $4750 D. expenses
C. $4856
107. Which of the following statements about
D. $4644 bonds and stocks is not correct?
102. The day-to-day financial activities neces- A. Bondholders have a risk of not being
sary to get the most from your money. able to sell the bonds in the secondary
market.
A. Money management
B. Shareholders are actually owners of
B. Budgeting
the company.
C. Personal financial planning C. Bondholders are the creditors of the
D. Personal property inventory firm.
103. Proper financial planning can satisfy our D. The shareholders have the priority to
physiological need and contribute to our get back the capital when the company is
physical well-being. Which one of the fol- liquidated.
lowing is physiological need? 108. The original amount of money on deposit.
A. Food A. Principal
B. Security B. Premium
C. Relationship with others C. Capital
D. Self-fulfillment D. Returns
104. Which is the state of retirement? 109. the things you want to accomplish.
A. Expenditure is zero, income continues A. Mission
B. Expenditure continues, income is zero B. Goals
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 926
C. Target C. own (liabilities)
D. Strategy D. owe (assets)
110. Arranging to spend, save, and invest 115. The ways in which people make, dis-
money to live comfortably, have financial tribute and use their goods and services
security and achieve goals. is called the
A. Personal Financial Planning A. opportunity cost
B. Budgeting B. short-term goals
NARAYAN CHANGDER
C. Time value of money C. economy
D. Liquidity D. means of exchange
111. Items that are relatively rare that people 116. A payment method used to electronically
collect in hopes that they will increase in deposit your paycheck into your bank ac-
value count
A. assets A. Direct deposit
B. luxury goods B. Pay yourself first
C. collectibles C. Automatic check cashing
D. lottery ticket D. none of above
112. If Jo Ann had $4000 in liquid assets 117. Which of the following are the risks of
and $1000 in current liabilities, she would bonds? (1) Interest rate risk(2) Coupon
have a current ratio of rate is not fixed(3) Reinvestment risk
A. 0.25. A. and (2) only
B. 4.0. B. and (3) only
C. and (3) only
C. 1000.
D. , (2) and (3)
D. 4000.
118. Anticipated expenses that are the same
113. Types of financial goals
each month and usually require payment
A. short-term goals:within next year around the same time each month
B. Intermediate goals:two to seven years A. Fixed expenses
C. Long-term goals:more than seven B. Variable expenses
years
C. Liabilities
D. None of the above D. Assets
114. What you include all types of loans, 119. The ability to easily convert financial as-
whether to your bank, family, or friends, sets into cash
as well as credit card debt and payments
that are due, such as house rental and util- A. Solvency
ity bills. B. Liquidity
A. own (assets) C. Accessibility
B. owe (liabilities) D. None of the above
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 927
120. Accumulations of assets by an individual 125. What is Financial Freedom?
such as money and possessions A. A status in which there is enough
PRACTICE BOOK» NOT FOR SALE
A. personal property inventory wealth to pursue the kind of life that de-
sire
B. personal wealth
B. A status in which a person leave their
C. solvent
job to seek freedom
D. colletions
C. A emotional state of a person that put
121. Robert feels his personal finance is not less effort on financial activity
so healthy in terms of managing debt. He D. none of above
has a credit card liability, a car loan, and a
$300 000 mortgage liability. Robert pos- 126. Money spent on different items; items
sesses a car worth and a house worth . that are necessary for maintaining a
What is Robert’s debt-to-asset ratio? household, and some are chosen.
A. Expenses
A. 80.5 percent
B. Income
B. 77.3 percent
C. Collateral
C. 83.3 percent
D. Cash flow
D. Insufficient information to calculate
127. If John’s total assets have increased from
122. If you have total assets of $10 000 and $10 000 to $15 000 and his liabilities
your net worth is $4000, how much liabil- from $5000 to $8000, by how much has
ities do you have? John’s net worth increased?
A. $4000 A. $4000
B. $6000 B. $3000
C. $10 000 C. $5000
D. $14 000 D. $2000
123. The three standard deductions from a 128. How do you know if you are financially
person’s pay include, federal taxes, state ready?
taxes, and A. Savings that able to cover 10-20 days
A. sales taxes expenses
B. social security B. Savings that able to cover 1-3 months
expenses
C. insurance
C. Savings that able to cover 3-6 months
D. retirement expenses
124. What is the term for the money you D. none of above
earn?
129. In life, there are many uncertainties that
A. expense you might face. It is extremely impor-
B. interest tantthat you are always prepared with
the right tools and knowledge for situa-
C. income tions.An / A is one such tool you can
D. savings use.
CHECK GOOGLE PLAY BOOKS FOR ANSWERS KEYS
1.14 Personal Financial Planning 928
A. bond A. $550
B. emergency fund B. $5
C. down payment C. $50
D. deposit D. $5500
130. The trade-off made by making one choice
133. What you include items such as cash,
instead of another is commonly referred to
savings, real estate, unittrusts or shares
as a(n)
in companies.
NARAYAN CHANGDER
A. trade decision
A. own (assets)
B. personal preference
B. owe (liabilities)
C. economic choice
C. own (liabilities)
D. opportunity cost
D. owe (assets)
131. The beliefs and principles you consider im-
portant, correct, and desirable. 134. Which of the following is not the benefit
A. goals of the financial planning?
B. wishes A. Saving money for emergency use
C. values B. To spend high amount of money on en-
D. personal financial planning terntainment
132. You put $500 into an investment account C. Prevent high amount of financial debt
and you earn 10%. What is your account D. Achieving personal financial security
value at the end of year one? and freedom
