LO 1.1 Distinguish between business and not-for-profit organizations.
Business consists of all profit‐seeking activities that provide goods and services necessary to an economic system. Not‐for‐profit organizations are business‐like establishments whose primary objectives involve social, political, governmental, educational, or similar functions instead of profits.
LO 1.2 Identify and describe the factors of production.
The factors of production have four basic inputs: natural resources, capital, human resources, and entrepreneurship. Natural resources include all productive inputs that are useful in their natural states. Capital includes technology, tools, information, and physical facilities. Human resources include anyone who works for the firm. Entrepreneurship is the willingness to take risks to create and operate a business.
LO 1.3 Describe the private enterprise system, including basic rights and entrepreneurship.
The private enterprise system is an economic system that rewards firms for being able to perceive and serve the needs and demands of consumers. Competition in the private enterprise system means success for firms that satisfy consumer demands. Citizens in a private enterprise economy enjoy rights to private property, profits, freedom of choice, and competition. Entrepreneurship drives economic growth.
LO 1.4 Identify the seven eras in the history of business.
The seven historical eras are the colonial period, the Industrial Revolution, the age of industrial entrepreneurs, the production era, the marketing era, the relationship era, and the social era. In the colonial period, businesses were small and rural, emphasizing agricultural production. The Industrial Revolution brought factories and mass production to business. The age of industrial entrepreneurs built on the Industrial Revolution through an expansion in the number and size of firms. The production era focused on the growth of factory operations through assembly lines and other efficient internal processes. During and following the Great Depression, businesses concentrated on finding markets for their products through advertising and selling, giving rise to the marketing era. In the relationship era, businesspeople focus on developing and sustaining long‐term relationships with customers and other businesses. The social era of business can be described as a new approach to the way businesses and individuals interact, connect, communicate, share, and exchange information with each other in virtual communities and networks around the world. Technology promotes innovation and communication, while alliances create a competitive advantage through partnerships. Concern for the environment also helps build strong relationships with customers.
LO 1.5 Explain how today’s business workforce and the nature of work itself are changing.
The workforce is changing in several significant ways: (1) It is aging and the labour pool is shrinking and (2) it is becoming increasingly diverse. The nature of work has shifted toward services and a focus on information. More firms now rely on outsourcing, offshoring, and nearshoring to produce goods or to fulfill services and functions that were previously handled in‐house or in‐country. Today’s workplaces are also becoming increasingly flexible, allowing employees to work from different locations and through different relationships. Companies promote innovation through teamwork and collaboration
LO 1.6 Identify the skills and attributes managers need to lead businesses in the twenty-first century.
Today’s managers need vision, which is the ability to perceive both marketplace needs and the way their firm can satisfy those needs. Critical thinking skills and creativity allow managers to pinpoint problems and opportunities and plan novel solutions. Finally, managers are dealing with rapid change, and they need skills to help lead their organizations through shifts in external and internal conditions.
LO 1.7 Outline the characteristics that make a company admired by the business community.
A company is usually admired for its solid profits, stable growth, a safe and challenging work environment, high‐quality goods and services, and business ethics and social responsibility.
TRUE-FALSE STATEMENTS
1. Large corporations are defined as businesses, whereas small companies are more of an investment.
Answer: False
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Reflective Thinking
2. Companies are NOT required to be ethical to succeed in the long run.
Answer: False
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Ethics
3. In order to remain viable, not-for-profit organizations need to focus on profits even more than the public service they provide.
Answer: False
Bloomcode: Application
Difficulty: Medium
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Ethics
4. Not-for-profit organizations are commonly exempt from federal, provincial, and local taxes.
Answer: True
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Analytic
5. Just as with a for-profit business, the first priority for a not-for-profit organization is making a profit.
Answer: False
Bloomcode: Application
Difficulty: Medium
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Reflective Thinking
6. An accountant’s view of profit is the difference between revenue and the cost incurred in generating the revenue. This view is shared by all business owners and the general public.
Answer: False
Bloomcode: Knowledge
Difficulty: Hard
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Analytic
7. Employees and founders of not-for-profit organizations do NOT usually earn any income from their operations.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Analytic
8. All factors of production are found in equal amounts in all businesses.
Answer: False
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Analytic
9. Capital includes money, machines, tools, buildings, and human resources.
Answer: False
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Identify and describe the factors of production.
Section Reference: Factors of Production
AACSB: Analytic
10. Natural resources are essential for certain companies but are NOT required for all economic systems.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify and describe the factors of production.
Section Reference: Factors of Production
AACSB: Analytic
11. Technology is considered to be capital.
Answer: True
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Identify and describe the factors of production.
Section Reference: Factors of Production
AACSB: Technology
12. High-end technology, such as the Global Positioning Satellite System offered in some new cars, is considered a capital resource.
Answer: True
Bloomcode: Application
Difficulty: Medium
Learning Objective: Identify and describe the factors of production.
Section Reference: Factors of Production
AACSB: Technology
13. When farmers rent land in order to increase crop production, they are acquiring capital.
Answer: False
Bloomcode: Application
Difficulty: Easy
Learning Objective: Identify and describe the factors of production.
Section Reference: Factors of Production
AACSB: Reflective Thinking
14. Entrepreneurship is synonymous with “risk-taking.”
Answer: True
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Identify and describe the factors of production.
Section Reference: Factors of Production
AACSB: Technology
15. An entrepreneur and a manager are the same.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify and describe the factors of production.
Section Reference: Factors of Production
AACSB: Analytic
16. The owner of a small business is part of the human resources of his/her organization.
Answer: True
Bloomcode: Knowledge
Difficulty: Hard
Learning Objective: Identify and describe the factors of production.
Section Reference: Factors of Production
AACSB: Analytic
17. The private enterprise system encourages government intervention.
Answer: False
Bloomcode: Application
Difficulty: Easy
Learning Objective: Describe the private enterprise system, including basic rights and entrepreneurship.
Section Reference: The Private Enterprise System
AACSB: Reflective Thinking
18. Canada functions under the private enterprise system.
Answer: True
Bloomcode: Application
Difficulty: Easy
Learning Objective: Describe the private enterprise system, including basic rights and entrepreneurship.
Section Reference: The Private Enterprise System
AACSB: Reflective Thinking
19. Adam Smith’s “invisible hand” refers to the battle among businesses for consumer acceptance.
Answer: True
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Describe the private enterprise system, including basic rights and entrepreneurship.
Section Reference: The Private Enterprise System
AACSB: Analytic
20. Profits are guaranteed by the private enterprise system for every entrepreneur with good management skills.
Answer: False
Bloomcode: Application
Difficulty: Easy
Learning Objective: Describe the private enterprise system, including basic rights and entrepreneurship.
Section Reference: The Private Enterprise System
AACSB: Reflective Thinking
21. Private property is considered the most important right in the private enterprise system.
Answer: True
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Describe the private enterprise system, including basic rights and entrepreneurship.
Section Reference: The Private Enterprise System
AACSB: Analytic
22. When customers enter a supermarket and select their favourite brand of laundry detergent, they are exercising their right to freedom of choice.
Answer: True
Bloomcode: Application
Difficulty: Medium
Learning Objective: Describe the private enterprise system, including basic rights and entrepreneurship.
Section Reference: The Private Enterprise System
AACSB: Reflective Thinking
23. When the government sets ground rules for competitive activity, the intent is to increase freedom of choice for consumers.
Answer: True
Bloomcode: Application
Difficulty: Easy
Learning Objective: Describe the private enterprise system, including basic rights and entrepreneurship.
Section Reference: The Private Enterprise System
AACSB: Analytic
24. In the private enterprise system, government has no role to play in ensuring fair competition.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Describe the private enterprise system, including basic rights and entrepreneurship.
Section Reference: The Private Enterprise System
AACSB: Analytic
25. Unfair or “cutthroat” competition, designed to eliminate competitors, is prohibited by the U.S. government.
Answer: True
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Describe the private enterprise system, including basic rights and entrepreneurship.
Section Reference: The Private Enterprise System
AACSB: Analytic
26. Finding unique ways to use the factors of production is a common characteristic of most entrepreneurs.
Answer: True
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Describe the private enterprise system, including basic rights and entrepreneurship.
Section Reference: The Private Enterprise System
AACSB: Reflective Thinking
27. Entrepreneurs are very conservative and usually invest only in sure winners.
Answer: True
Bloomcode: Application
Difficulty: Easy
Learning Objective: Describe the private enterprise system, including basic rights and entrepreneurship.
Section Reference: The Private Enterprise System
AACSB: Reflective Thinking
28. The Canadian Radio-television and Telecommunications Commission (CRTC) has made a decision that has increased the cost charged to small internet service providers that buy access from larger internet services providers such as Bell. This decision is a violation of the private enterprise system in Canada.
Answer. False
Bloomcode: Application
Difficulty: Hard
Learning Objective: Describe the private enterprise system, including basic rights and entrepreneurship.
Section Reference: The Private Enterprise System
AACSB: Analytic
29. Successful entrepreneurs usually create large corporations.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Describe the private enterprise system, including basic rights and entrepreneurship.
Section Reference: The Private Enterprise System
AACSB: Analytic
30. During the colonial period, the focus was on agriculture and other rural activities.
Answer: True
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Analytic
31. The Industrial Revolution began in Germany and quickly spread to the rest of Europe.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Analytic
32. The Industrial Revolution began in the United States with the development of the automobile.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Analytic
33. One factor that led to the Industrial Revolution was the mechanization of agriculture.
Answer: True
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Analytic
34. A key element of the production era was the use of consumer research.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Analytic
35. The production era preceded the age of industrial entrepreneurs.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Analytic
36. In consumer orientation, a company creates a product first, and then determines if the consumer will likely purchase the product.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Reflective Thinking
37. The Nike swoosh is NOT considered a brand; only the company name can be a brand.
Answer: False
Bloomcode: Application
Difficulty: Medium
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Analytic
38. The current philosophy among managers today is best described as transaction management.
Answer: False
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Analytic
39. Information technology has been the key driver behind the relationship era.
Answer: True
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Technology
40. Technology has revolutionized business communications.
Answer: True
Bloomcode: Application
Difficulty: Easy
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Technology
41. Relationship management refers to ongoing, mutually beneficial ties between a company and its vendors.
Answer: False
Bloomcode: Application
Difficulty: Medium
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Technology
42. Technology can make some products obsolete.
Answer: True
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Technology
43. Relationship management concentrates on short-term interactions with customers.
Answer: False
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Analytic
44. The number of companies forming partnerships and strategic alliances has declined in recent years.
Answer: False
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Analytic
45. The use of blogs as a link between companies and their customers is on the decline.
Answer: False
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Technology
46. Assume Motorola and Microsoft work on developing a new cell phone that also is a PDA. This is an example of a strategic alliance.
Answer: True
Bloomcode: Application
Difficulty: Medium
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Analytic
47. The need to develop environmentally friendly products and processes is becoming a major new force in business today.
Answer: True
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Analytic
48. A strategic alliance is a partnership formed to create competitive advantage for the businesses involved.
Answer: True
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Analytic
49. The use of assembly lines became popular during the colonial era.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Technology
50. Relationship management is important in the relationship era and the social era.
Answer: True
Bloomcode: Knowledge
Difficulty: Hard
Learning Objective: Identify the seven eras in the history of business.
Section Reference: Seven Eras in the History of Business
AACSB: Ethics
51. The needs of older workers are similar to those of younger workers.
Answer: False
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Explain how today’s business workforce and the nature of work itself are changing.
Section Reference: Today’s Business Workforce
AACSB: Reflective Thinking
52. During the next few years, the average age of the workforce is expected to increase.
Answer: True
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Explain how today’s business workforce and the nature of work itself are changing.
Section Reference: Today’s Business Workforce
53. Although the number of college-educated workers has doubled in the last 20 years, the demand for workers is still greater than the supply.
Answer: True
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Explain how today’s business workforce and the nature of work itself are changing.
Section Reference: Today’s Business Workforce
54. Research indicates that work teams consisting of a diverse group of individuals often are more productive than less diverse work teams.
Answer: True
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Explain how today’s business workforce and the nature of work itself are changing.
Section Reference: Today’s Business Workforce
AACSB: Diversity
55. Outsourcing is the relocation of business activities to lower-cost locations overseas.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Explain how today’s business workforce and the nature of work itself are changing.
Section Reference: Today’s Business Workforce
56. Today, workers are much less likely to remain with the same employer throughout their entire careers.
Answer: True
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Explain how today’s business workforce and the nature of work itself are changing.
Section Reference: Today’s Business Workforce
57. The new employer-employee relationship requires firms to establish rigid rules to govern employee activities.
Answer: False
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Explain how today’s business workforce and the nature of work itself are changing.
Section Reference: Today’s Business Workforce
58. The managerial quality of vision is the ability to see all of the problems that might occur.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Explain how today’s business workforce and the nature of work itself are changing.
Section Reference: Today’s Business Workforce
59. The retirement of baby boomers CANNOT create a shortage in the Canadian workforce since students are graduating each year.
Answer: False
Bloomcode: Application
Difficulty: Medium
Learning Objective: Explain how today’s business workforce and the nature of work itself are changing.
Section Reference: Today’s Business Workforce
60. Skilled and knowledgeable employees are essential resources that could help an organization to create change in today’s dynamic business environment.
Answer: True
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Explain how today’s business workforce and the nature of work itself are changing.
Section Reference: Today’s Business Workforce
61. Critical thinking skills and creativity are essential qualities for today’s managers.
Answer: True
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Identify the skills and attributes managers need to lead businesses in the twenty-first century.
Section Reference: The Twenty-First-Century Manager
62. Critical thinking is the ability to analyze and assess information to pinpoint problems and opportunities.
Answer: True
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Identify the skills and attributes managers need to lead businesses in the twenty-first century.
Section Reference: The Twenty-First-Century Manager
63. Creativity is the capacity to develop well-tested solutions to common organizational problems.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify the skills and attributes managers need to lead businesses in the twenty-first century.
Section Reference: The Twenty-First-Century Manager
64. A manager’s only obligation is to create an environment for creativity and critical thinking. The implementation of those ideas is carried out by other departments.
Answer: False
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify the skills and attributes managers need to lead businesses in the twenty-first century.
Section Reference: The Twenty-First-Century Manager
65. Mental exercises like brainstorming often foster creativity.
Answer: True
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Identify the skills and attributes managers need to lead businesses in the twenty-first century.
Section Reference: The Twenty-First-Century Manager
66. Decreased consumer loyalty is an example of an external force that requires change.
Answer: True
Bloomcode: Application
Difficulty: Medium
Learning Objective: Identify the skills and attributes managers need to lead businesses in the twenty-first century.
Section Reference: The Twenty-First-Century Manager
67. For a company to be successful, the vision and mission statements should align.
Answer: True
Bloomcode: Application
Difficulty: Easy
Learning Objective: Identify the skills and attributes managers need to lead businesses in the twenty-first century.
Section Reference: The Twenty-First-Century Manager
68. Force of change can only come from external sources.
Answer: False
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Identify the skills and attributes managers need to lead businesses in the twenty-first century.
Section Reference: The Twenty-First-Century Manager
69. Business ethics deal with the right-versus-wrong actions that arise in a work environment.
Answer: True
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Outline the characteristics that make a company admired by the business community.
Section Reference: What Makes a Company Admired?
AACSB: Ethics
70. The most important factor for determining whether or NOT a company is admired is profitability.
Answer: False
Bloomcode: Application
Difficulty: Easy
Learning Objective: Outline the characteristics that make a company admired by the business community.
Section Reference: What Makes a Company Admired?
AACSB: Ethics
71. By supporting local charities, a firm is demonstrating social responsibility.
Answer: True
Bloomcode: Application
Difficulty: Easy
Learning Objective: Outline the characteristics that make a company admired by the business community.
Section Reference: What Makes a Company Admired?
AACSB: Ethics
72. Social responsibility is another way of saying ethics.
Answer: False
Bloomcode: Application
Difficulty: Easy
Learning Objective: Outline the characteristics that make a company admired by the business community.
Section Reference: What Makes a Company Admired?
AACSB: Ethics
73. Companies that are serious about ethical operations are likely to be socially responsible.
Answer: True
Bloomcode: Application
Difficulty: Easy
Learning Objective: Outline the characteristics that make a company admired by the business community.
Section Reference: What Makes a Company Admired?
AACSB: Ethics
MULTIPLE CHOICE QUESTIONS
74. Which of the following are organized for-profit and provide goods and services?
a) public schools
b) churches
c) government
d) businesses
Answer: d
Bloomcode: Application
Difficulty: Easy
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Reflective Thinking
75. All of the following statements are correct EXCEPT
a) successful businesses seek to meet their social and ethical responsibilities.
b) business is the economic pulse of a nation.
c) business includes not-for-profit organizations that provide services to the public.
d) business provides goods and services necessary to an economic system.
Answer: c
Bloomcode: Application
Difficulty: Hard
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Reflective Thinking
76. In accounting terms, profits are ______.
a) the difference between revenues and expenses
b) the difference between commissions earned and receipts
c) the difference between sales and expenses
d) the sum of sales and expenses
Answer: a
Bloomcode: Knowledge
Difficulty: Easy
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Analytic
77. In the Canadian economy, ______ are considered the reward for the risk of entering business.
a) revenues
b) profits
c) sales
d) generated income amounts
Answer: b
Bloomcode: Application
Difficulty: Hard
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Ethics
78. ______ is essential because it serves as a primary incentive for people to start companies, expand them, and provide consistently high-quality competitive goods and services.
a) Vision
b) Profit
c) Market research
d) Philanthropy
Answer: b
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Reflective Thinking
79. All of the following are businesses EXCEPT ______.
a) U.S. Postal Service
b) UPS
c) FedEx
d) AOL Time Warner
Answer: a
Bloomcode: Application
Difficulty: Easy
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Analytic
80. All of the following are typically part of the not-for-profit sector EXCEPT ______.
a) hotels
b) political parties
c) religious organizations
d) labour unions
Answer: a
Bloomcode: Application
Difficulty: Medium
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Analytic
81. A public-sector not-for-profit organization would include which of the following?a) library
b) museum
c) charitable
d) labour union
Answer: d
Bloomcode: Application
Difficulty: Medium
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Analytic
82. ______ are a public not-for-profit profit organization.
a) Religious organizations
b) Charitable organizations
c) Trade associations
d) Political parties
Answer: d
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Analytic
83. To be successful in the long run, business must be socially responsible toward
a) customers.
b) employees.
c) suppliers.
d) all of the stakeholder group above
Answer: d
Bloomcode: Knowledge
Difficulty: Hard
Learning Objective: Distinguish between business and not‐for‐profit organizations.
Section Reference: What Is Business?
AACSB: Analytic
84. The factors of production in an economic system are ______.
a) land, rent, capital, and human resources
b) capital, perseverance, natural resources, and human resources
c) rent, wages, interest, and profit
d) natural resources, human resources, capital, and entrepreneurship
Answer: d
Bloomcode: Knowledge
Difficulty: Medium
Learning Objective: Identify and describe the factors of production.
Section Reference: Factors of Production
85. Timber Trails, a northwest lumber company, utilizes ______ as its primary production factor.
a) natural resources
b) capital
c) entrepreneurship
d) human resources
Answer: a
Bloomcode: Application
Difficulty: Medium
Learning Objective: Identify and describe the factors of production.
Section Reference: Factors of Production
AACSB: Reflective Thinking
86. Donovan Corporation’s sources of capital can include all of the following EXCEPT
a) investments from stockholders.
b) reinvested profits.
c) cash dividends declared by Donovan’s board of directors and paid to the stockholders.
d) investments from venture capitalists.
Answer: c
Bloomcode: Application
Difficulty: Hard
Learning Objective: Identify and describe the factors of production.
Section Reference: Factors of Production
AACSB: Reflective Thinking
87. Technology, tools, information, and physical facilities for the operation of a business are examples of ______.
a) profits
b) wages
c) capital
