Test Questions Chapters 1-4

Sample Test Questions Chapters 1-4

Q1-1. A key characteristic of entrepreneurs is that they:

A) are willing to accept the risks involved in starting and managing a business.

B) have a high level of scientific and technical expertise.

C) possess a great deal of personal wealth.

D) have experience in running large, complex organizations.

Q1-2. Elizabeth owns a printing business in her home town. The printers, computers, and copying machines represent examples of:

A) natural resources. C) current assets.

B) intangible resources. D) capital.

Q1-3. Taxes and government regulations are part of the ________________ environment of business.

A) economic and legal C) social

B) competitive D) technological

Q1-4. ___________ is the buying and selling of products and services by businesses and consumers over the Internet.

A) E-commerce C) Telecommuting

B) Entrepreneurship D) I-commerce

Q1-5. Ntercon is an Internet-based company that provides online support services for businesses that need help in setting up and maintaining their websites. Ntercon is an example of a company that is engaged in:

A) B2C e-commerce. C) Y2K e-commerce.

B) N2Y e-commerce. D) B2B e-commerce.

Q1-6. Collectively, the customers, employees, stockholders, suppliers, creditors, and the local communities in which a business operates are known as the firm's:

A) market. C) stakeholders.

B) economic environment. D) social dependents.

Q1-7. As a salesperson for Bi-State Direct, Jack enjoys the freedom and flexibility he has to better meet the needs of his customers. Jack's experience suggests that Bi-State practices:

A) centralized management. C) enfranchisement

B) outsourcing. D) empowerment.

Q1-8. Which of the following statements represents the most likely changes in the size and composition of the U.S. population by the year 2050?

A) The total population of the US will more than double, but there will be little or no change in the percentages of the population found in various racial and ethnic groups.

B) The total population will increase slightly, but the makeup of the population will be characterized by fewer Hispanics and Asians.

C) Neither the size of the population nor its makeup will change significantly.

D) The number and percentage of both Hispanics and Asians will increase significantly.

Q1-9. ____________ measures the output produced in a given time period by work hours.

A) Elasticity B) Productivity C) Proficiency D) Marginal output

Q1-10. In recent years, almost all new job creation in the United States has occurred in the ________________ sector:

A) service C) agricultural

B) manufacturing D) telecommunications

Answers for Chapter 1

Q1-1 (A) A p. 4

Q1-2 (A) D p. 10

Q1-3 (A) A p. 12 - 13

Q1-4 (A) A p. 16

Q1-5 (A) D p. 16

Q1-6 (A) C p. 6

Q1-7 (A) D p. 20

Q1-8 (A) D p. 21

Q1-9 (A) B p. 15

Q1-10 (A) A p. 26

Q2-1. Which of the following would be a topic emphasized in a microeconomics class?

A) How a nation's GDP is computed.

B) The reason's why the unemployment rate for the economy is rising or falling.

C) How market conditions determine the price of a specific product.

D) How the government can use fiscal and monetary policies to stabilize the economy.

Q2-2. For many years, Congressman Reggie Lader has called for more government regulation of business. "After all," the Congressman said recently, "Businesspeople are out to make a profit, not to create jobs or serve their customers. The government must pass more laws to require businesses to take the interests of consumers and workers into account." From these comments, it is clear that Congressman Lader:

A) agrees with the ideas of Thomas Malthus.

B) does not accept the philosophy behind Adam Smith's invisible hand.

C) is unaware of the fact that most businesses in the United States are actually owned by the government.

D) does not realize that government regulation is already the main determinant of business decisions in capitalist economies.

Q2-3. When the supply curve and demand curve for a particular good are on a single graph, the point at which the two curves intersect identifies the:

A) total profit earned by producers.

B) total amount of labor that will be employed in that market.

C) amount of time it takes to bring together the buyers and sellers of the good.

D) equilibrium price of the good.

Q2-4. In most large cities there are a large number of bakeries. These bakeries produce similar, but not identical, products. Some bakeries claim to have the best cheesecakes in town, while others brag about their cookies or specialty breads. The bakery market in a large city is an example of:

A) monopolistic