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Name ____________________________ Date___________Period_______

Introduction to Business

1. In a ________ all resources are owned and controlled by the government.

a. command economy

b. traditional economy

c. market economy

d. mixed economy
2. Each of the following is one of the three economic questions that must be answered in all nations
except:

a. What goods and services will be produced?

b. How will the goods and services be produced?

c. Who will receive the profits earned when goods and services are produced?

What needs and wants will be satisfied with the goods and services
d. produced?
3. Which of the following is an example of a service?

a. The shingles that are used to put a new roof on your home.

b. The effort of the worker you hire to put a new roof on your home.

c. The hammer that is used to install the new shingles on your home.

d. The increased value of your home after a new roof is installed.

4. The first step in the decision-making process is to:

a. identify the choices.

b. define the problem.

c. evaluate advantages and disadvantages of each choice.

d. review your decision.

5. ________ include tools and equipment used to produce goods and services.

a. Natural resources

b. Human resources

c. Capital resources
 7. A ________ is a period of time in which demand begins to decrease,
businesses lower production, unemployment begins to rise and GDP growth slows for two or more
quarters of the calendar year. 2

a. slump

b. downturn

c. recession

d. trough

1. Gross domestic product is the:

dollar value of all final goods and services produced in a country

a. during one year.
dollar value of all goods and services produced in a country during
b. one year.
price-adjusted value of all goods and services produced in a country
c. during one year.
value of all final goods and services produced in, or imported to, a
d. country during one year.

d. Consumer resources
.

8. A ________ occurs when a business or government spends less than it receives in income.

a. budget deficit

b. budget shortage

c. budget over-run

d. budget surplus

9. Consumer debt includes each of the following except:

a. unspent consumer income.

b. home mortgages.

c. unpaid credit card balances.

d. home-improvement loans.

10. A ________ represents a unit of ownership in a corporation.

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a. corporate bond

b. corporate income statement

c. share of corporate stock

d. corporate balance sheet

11. Each of the following will have an important impact on a nation's economic conditions except:

a. the literacy rates and training of its workers.

b. the types of technology used by its workers.

c. the nation's capital resources.

d. the language spoken by its workers.

12. In recent years, the United States has had:

a. a trade surplus with most other nations.

b. a trade shortage with most other nations.

c. a trade equilibrium with most other nations.

d. a trade deficit with most other nations.

13. A corporation that is involved in business in several nations is known as:

a. an international player.

b. a multinational company.

c. a bilateral competitor.

d. an imperialist business.
14. Which of the following conditions is likely to cause the value of a nation's currency to decline?

a. A high rate of inflation.

b. A low rate of unemployment.
c. A stable government.
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d. A steady rate of economic growth.

15.________ is the making, buying, and selling of goods and services within a country.

a. Foreign trade

b. International business

c. Domestic business

d. Multinational trade

16. The Americans with Disabilities Act requires each of the following except:

a. people with sight or hearing limitations must be accommodated on the job.

b. public buildings must have access for wheelchairs.

c. disabled workers must be given equal access to jobs they are able to perform.

d. workers may not be excluded from hiring or promotion because of their age.
17. The role of the government in the economy rarely changes when newly elected officials take office.

True

False

18. ________ are rules about how businesses and their employees ought to behave.

a. Business ethics

b. Moral values

c. Community responsibilities

d. Labor standards

19. Governments obtain revenue through taxing and borrowing.

True

False

20. In the United States, workers have a basic right to safe working conditions.

True
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False

21. A ________ is a business owned and run by just one person.

a. nonprofit corporation

b. partnership

c. proprietorship

d. limited liability company

22. In the 21st century, there will be relatively few changes in employment and career patterns in the U.S.
economy.

True

False

23. The ________ is a written legal document that defines ownership and operating procedures and
conditions for a business.

a. commercial code

b. business plan

c. organizational chart

d. articles of incorporation
24. A(n) ________ is a short, specific written declaration of the reason a business exists and what it
wants to achieve.

a. statement of intent

b. affirmation of purpose

c. mission statement

d. declaration of principle

25. Policies are descriptions of the way work is to be done.

True
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False
26. According to the Small Business Administration (SBA), a small business is one with 100 or fewer
workers.

True

False

27. A business plan should include each of the following except:

a. a description of the business.

b. a budget for the business.

c. a listing of individual employees and their job responsibilities.

d. a description of major marketing activities.

28. Which of the following is not a common reason for the failure of many new businesses?

a. lack of adequate capital

b. low sales

c. shortage of workers

d. competitive pressure

29. ________ is money provided by large investors to finance new products or businesses that have a
good chance to be profitable.

a. Marginal capital

b. Working capital

c. Venture capital

d. Leading capital

30. ________ financing is the money needed to pay for the current operating activities of a business.

a. Start-up

b. Long-term
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c. Short-term

d. Intermediate
31. Top-level managers spend most of their time planning and controlling business activities.

True

False

32. Management ________ is the way a manager treats and involves employees.

a. technique

b. design

c. style

d. approach
33. Your ________ values are the important principles that will guide your decisions and actions in a
business.

a. core

b. major

c. family

d. community

34. ________, one of the five functions of management, determines to what extent the business is
accomplishing the goals it set out to reach in the planning stage.

a. Controlling

b. Assessing

c. Evaluating

d. Judging

35. Ethical business practices ensure that the highest standards of conduct are observed in a company's
relationships.

True

False

36. A worker's compensation includes two basic elements which are:

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a. working conditions and salary or wages.

b. benefits and salary or wages.

c. benefits and reimbursements.

d. base pay and commissions.

37. The U.S. economy has moved from an emphasis on goods-producing businesses to service-
producing businesses.

True

False

38. The ________ is the physical conditions and psychological atmosphere in which employees work.

a. business location

b. office

c. work environment

d. shop

39. ________ removes work from one company and sends it to another company that can complete it at
a lower cost.

a. Downsizing

b. Rationalizing

c. Subsidizing

d. Outsourcing

40. A(n) ________ is always a permanent end of employment for a worker.

a. layoff

b. transfer

c. termination

d. extinction

41. The Occupational Outlook Handbook is a source of information about hundreds of occupations you
might choose that is prepared by the U.S. Department of Health and Human Services.
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True

False

42. Which of the following types of information should not be included in a resume?

a. Your name, address, phone number and e-mail address.

b. Your marital or family situation.

c. Your education, training, and related job experience.

d. Your career objective.

43. An employment interview is a two-way conversation in which the interviewer learns about you and
you learn about the job and the company.

True

False

44. A good reason to make a tentative career decision while you are in school is:

a. the fact that you will probably keep the same job through most of your life.

b. the fact that this will help you earn more money while you are in school.

c. the fact that this will help you choose appropriate courses while you are in school.

d. the fact that this will help you avoid "dead-end" jobs in the future.

45. When preparing your resume, it is a good idea to exaggerate your qualifications for the job.

True

False
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