Business Essentials, 13e

(Ebert/Griffin)

Chapter 7
Operations Management and Quality

1) Explain what is meant by the term utility. What type of utility is created when a
pharmacy changes its evening schedule to remain open for an extra hour in response to
customer needs?

2) Describe the difference between the make-to-order and make-to-stock production

processes.

3) Describe the role of the customer in the operations process of a service.

4) Why is it important that a firm use long-range capacity planning?

5) Describe two alternatives for production facility layouts.

6) Describe how a Gantt chart and a PERT chart are similar, and how they are
different.

7) Describe the purpose of a master operations schedule and its relationship to other
scheduling tools.

8) Describe the purpose of quality control for goods and services.

9) In a total quality management environment, what are some steps that companies use
to emphasize the importance of quality?
10) Describe the five most commonly used tools for TQM.
 Chapter 11
Marketing Processes and Consumer Behavior

1) Discuss what marketers must do to increase value for customers and satisfy
customers.

2) Explain the elements that comprise the marketing environment.

3) Describe the three types of competition faced by marketers.

4) Describe the distribution decisions firms must consider when getting products to
customers.
5) Describe the elements of the marketing mix. What is their collective role?

Hint: The elements of the marketing mix include product, price, promotion, and place.

6) Why is product development a challenge for marketers?

7) Explain the difference between demographic and geo-demographic variables.

8) Identify demographic and psychographic variables.

9) Explain how marketers identify different market segments.

10) Describe the effectiveness of viral marketing and social networking as a marketing
tool.

Hint: Viral marketing and social networking can lead to consumer awareness faster and
with wider reach than traditional media messages–and at a lower cost.
 Chapter 13
Distributing and Promoting Products

1) Explain the primary difference between a retailer and a wholesaler.

2) Explain the primary difference between a wholesaler and a sales agent.

3) Explain how shopping e-agents help online consumers.

Hint: Shopping agents (e-agents) help online consumers by gathering and sorting
information.

4) Describe the services provided by e-intermediaries.

5) Describe the various types of bargain retailers.

6) Why would one expect a product sold at a specialty store to cost more than the
same product at a department store?

Hint: Department stores provide a variety of products, divided by type into various
departments, whereas specialty stores will specialize in one particular product.

7) Explain the difference between an electronic storefront and a cybermall.

8) How do advertising real-time ad tracking in the creation of their media mix?

9) Explain the importance of direct marketing.

Hint: Direct (or interactive) marketing is one-on-one nonpersonal selling that tries to
get consumers to make purchases away from retail stores and, instead, to purchase
from home, at work, or using a mobile device.

10) What is the difference between coupons and premiums?

 Chapter 14
Information Technology (IT) for Business

1) Explain the principle of mass-customization.

2) How has information technology affected organizational structure in terms of the

number of employees and the organizational structure?

3) Discuss the impacts information technology has had on the business world.

4) Describe how data mining is used by managers.

Hint: After collecting information, managers use data mining, the application of
advanced statistical analyses, and electronic technologies for searching, sifting, and
reorganizing pools of data to uncover useful information.
5) What is a decision support system?

6) Describe the role of information systems, the different types of information

systems, and how businesses use such systems.

Hint: An information system enables users to collect, process, and transmit information
for use in decision-making. Because they work on different kinds of problems and in
different areas of businesses, users have access to specialized information systems
that satisfy their different information needs.

7) Discuss the ethical concerns that have developed due to improvements in information
technology.

8) Describe the ways in which businesses protect themselves from the threats and
risks information technology poses.

Hint: Most systems guard against unauthorized access by requiring users to have
protected passwords. In addition, many firms rely on safeguards, such as firewalls, so
that only messages that meet the conditions of the company's security policy are
permitted to flow in or out of the network.
 Chapter 15
The Role of Accountants and Accounting Information

1) Discuss the purpose of the CPA Vision Project.

2) Discuss the provision of the Sarbanes-Oxley Act of 2002 (Sarbox).

Hint: Federal regulations, primarily the Sarbanes-Oxley Act of 2002 (Sarbox or SOX),
have been enacted to restore and maintain public trust in corporate accounting
practices.

3) Give three examples of management advisory services.

4) Identify the potential users of accounting information.

5) Discuss the role of a private accountant within large and small firms.

6) Describe the importance of current assets.

7) Explain fixed assets and how accountants spread the cost of an asset over the years
of its useful life.

Hint: Fixed assets (such as land, buildings, and equipment) have long-term use or value,
but as buildings and equipment wear out or become obsolete, their value decreases.

8) What is the statement of cash flow required by the SEC and why is it required?
Read the scenario below first.

You are a marine property adjuster charged with minimizing the loss of cargo on three
insured barges that sank yesterday off the coast of Alaska. Each barge holds
$200,000 worth of cargo, which will be lost if not salvaged within 72 hours. The owner
of a local marine salvage company gives you two options, both of which will cost the
same:

Plan A: This plan will save the cargo of one of the three barges, worth $200,000.

Plan B: This plan has a one-third probability of saving the cargo on all three barges,
worth $600,000, but has a two-thirds probability of saving nothing.

Plan C: This plan will result in the loss of two of the three cargoes, worth $400,000.

Plan D: This plan has a two-thirds probability of resulting in the loss of all three
cargoes and the entire $600,000 but has a one-third probability of losing no cargo.

1. Which is(are) the gain framing option(s)?

1) Plan A
2) Plan A & B
3) Plan C
4) Plan C & D
5) Plan A & C

2. Please choose one incorrect statement below:

1) The general tendency has been found that more people select Plan A, when only
Plan A and B were available.
2) Plan C is a less risky option compared to Plan A.
3) The mechanism of general patterns in responses in this scenario can be
explained by loss aversion.
4) The inherent personal tendency can also make differences in answers for this
scenario.
5) The findings from this study can be discussed as an example of the framing
trap.

3. Decision making biases can ________________.

1) work in isolation
2) be less dangerous when they work in concert.
3) improve rational thinking.
4) not be prevented.
5) influence only the perception stage of decision-making.
4. Climate change is all about the general trend of warming throughout the globe, not
individual days or even years. But when they’re in the midst of a cold winter, people may
tend to believe that climate change isn’t really happening, because their larger beliefs
about the state of the global climate are most strongly influenced by the recent
weather in their area. This is why, in attempting to assess whether climate change is
really happening, it’s important to look at average temperatures and weather
patterns—because our minds are so easily skewed by what we personally are
experiencing most recently. This can be explained by ____________.

1) Halo effect
2) Sunk-cost effect
3) Groupthink
4) Endowment effect
5) Availability bias

5. An investor may only seek out financial news that confirms their belief that a
particular stock will rise, ignoring reports that may suggest the [Link] can be
explained by ____________.

1) Halo effect
2) Sunk-cost effect
3) Confirming evidence trap
4) Anchoring bias
5) Status-quo trap

6. A decision-maker can ask the recommenders “Could the diagnosis be overly

influenced by an analogy to a memorable success?” safeguard against:

1) Saliency/Recallability bias
2) Confirmation bias
3) Groupthink
4) Anchoring bias
5) Availability bias

7. The Space Shuttle, Challenger, would be able to easily avoid its tragedy if ______
were asked.

8. A decision-maker can ask himself/herself “Has the team fallen in love with its
proposal?” to safeguard against ________ heuristic.

1) Saliency
2) Familiarity
3) Availability
4) Affect
 5) Representativeness

9. If the Change Management Simulation reflects a real-world situation, what will

happen for a middle manager who implanted highly disruptive levers like “restructure
organization” and “revise reward system” from the beginning?

1) No positive impact, but possibly a negative impact on the agent’s credibility.

2) Improved credibility of the agent
3) Improved morale of the company
4) One step backward to the previous change stage of coworkers (e.g., reverse
from adoption to trial stage)
5) One step forward to the next change stage of coworkers (e.g., progression from
trial to adoption stage)

10. A change phase of an organization can be labeled as [mobilize], [movement], or

[sustain] phase from the beginning to the final phases. (i.e., the words’ order is
important)

(1) mobilise → (2) movement → (3) sustain