41) Signs are important to the small business owner because they:
A) grow in effectiveness the longer they are in place.
B) are easy to use and to change.
C) provide the maximum space for relatively complex messages.
D) are a medium that is not subject to regulation, thereby permitting maximum flexibility.
Topic: Signs
AACSB: Analytic Skills
42) The science of adapting work and working conditions to complement employees and to suit
customers is called:
A) physiology.
B) ergonomics.
C) layout design.
D) kinesiology.
Topic: Interiors
AACSB: Analytic Skills
43) When planning store, office, or plant layouts, business owners too often focus on ________,
rather than enhancing employees’ productivity or maximizing sales.
A) construction schedules.
B) choosing an architect or designer.
C) minimizing costs.
D) None of the above
Topic: Interiors
AACSB: Analytic Skills
44) When evaluating the floors, walls, and ceilings in a retail store, the small business owner
should:
A) look for dark colored ceilings that both conserve energy and project a cool feeling.
B) strive for a light and bright interior.
C) look for bare functional walls that can be recovered at the owner’s expense.
D) emphasize function over attractiveness.
Topic: Sight, Sound, Scent, and Lighting
AACSB: Analytic Skills
11
45) For retailers, lighting:
A) is used to attract customers to a specific display.
B) is an expensive investment.
C) has little impact on the overall appearance of the business.
D) requires the same considerations as for manufacturers.
Topic: Sight, Sound, Scent, and Lighting
AACSB: Analytic Skills
46) The best way to determine where to place merchandise, what a store’s “hot” and “cold” spots
are, is to:
A) conduct a kinesiology study.
B) hire a market research firm to study your business.
C) conduct focus groups with former customers.
D) simply observe customers in the store.
Topic: Layout for Retailers
AACSB: Analytic Skills
47) A(n) ________ layout arranges displays in a rectangular fashion with parallel aisles. It is a
formal layout that controls the traffic flow through the store.
A) free-form
B) grid
C) angled
D) boutique
Topic: Layout for Retailers
AACSB: Analytic Skills
48) The typical grocery store uses a(n) ________ layout.
A) grid
B) free-form
C) boutique
D) arcade
Topic: Layout for Retailers
AACSB: Analytic Skills
12
49) A(n) ________ layout has the advantage of creating a relaxed, friendly shopping atmosphere
encouraging shoppers to linger and increasing the number of impulse purchases.
A) free-form
B) grid
C) angled
D) boutique
Topic: Layout for Retailers
AACSB: Analytic Skills
50) A(n) ________ layout divides a store into a series of individual shopping areas, each with its
own theme. This layout can create a distinctive image for a business.
A) free-form
B) grid
C) angled
D) boutique
Topic: Layout for Retailers
AACSB: Analytic Skills
51) The boutique layout is commonly used in:
A) supermarkets.
B) self-service stores.
C) small department stores.
D) stores with a high number of impulse goods.
Topic: Layout for Retailers
AACSB: Analytic Skills
52) Manufacturing layout decisions take into consideration:
A) customer buying behavior, the types of product sold, and the physical dimensions of the
building.
B) the product, the process, the facility, and key economic considerations.
C) the status of the building; built, bought, or leased and the type of product sold.
D) the employees, the customer, and the mechanical process used to produce the product.
Topic: Layout for Manufacturers
AACSB: Analytic Skills
13
53) The manufacturing layout that arranges workers and equipment according to sequence of
operation and is best suited for highly standardized or mass-produced products is called:
A) process layout.
B) fixed-position layout.
C) function layout.
D) product layout.
Topic: Layout for Manufacturers
AACSB: Analytic Skills
54) A product layout has the disadvantage of:
A) a high fixed investment in specialized equipment.
B) the highest materials costs with lower productivity.
C) being harder to schedule and monitor.
D) dividing the work area into separate operations that are highly independent with a duplication
of equipment.
Topic: Types of Manufacturing Layouts
AACSB: Analytic Skills
55) The manufacturing layout that groups workers and equipment according to the general
function performed, and that works best with short production runs or when there are
considerable variations in the finished product, is called:
A) process layout.
B) fixed-position layout.
C) function layout.
D) product layout.
Topic: Types of Manufacturing Layouts
AACSB: Analytic Skills
56) A process layout would be best fitted to:
A) an automobile assembly plant.
B) an oil refinery.
C) a manufacturer of handmade metal gifts.
D) a textbook publishing plant.
Topic: Types of Manufacturing Layouts
AACSB: Analytic Skills
14
57) When manufacturing large, bulky products, it is sometimes necessary to bring the materials
to a specific spot and do the assembly in one place. This type of layout is know as a:
A) process layout.
B) fixed-position layout.
C) function layout.
D) product layout.
Topic: Types of Manufacturing Layouts
AACSB: Analytic Skills
58) The starting point for designing a layout is:
A) creating a detailed layout design showing the space relationships.
B) discovering the single best flow for the manufacturing process.
C) arranging the equipment and materials stocking areas in the proper sequence.
D) determining how and in what sequence product parts or service tasks flow together.
Topic: Types of Manufacturing Layouts
AACSB: Analytic Skills
59) Site selection begins with considering what city in which to locate and then broadening the
search to consider the region and state.
Topic: Introduction
AACSB: Analytic Skills
60) The first phase in selecting a location is determining what regions of the country are
experiencing substantial growth.
Topic: Selecting the Region
AACSB: Analytic Skills
61) A variance is a special exception to a zoning ordinance.
Topic: Local Laws and Regulations
AACSB: Analytic Skills
62) The Zip Code Atlas and Market Planner provide detailed information on sales, spendable
income, etc., by census region, county, and city.
Topic: Selecting the Region
AACSB: Analytic Skills
15
63) While GIS software allows a business owner to plot his/her existing customer base on a map,
it does not provide zip code information.
Topic: Selecting the Region
AACSB: Analytic Skills
64) The U.S. Census Department’s “TIGER” file is a computerized map of the entire United
States that gives entrepreneurs the power to pinpoint existing and potential customers.
Topic: Selecting the Region
AACSB: Analytic Skills
65) The less specialized the firm, the greater the importance of proximity in the location
decision.
Topic: Selecting the State
AACSB: Analytic Skills
66) When analyzing the labor supply, a small service business is only concerned with the level of
education and training of the labor force in the area.
Topic: Labor Supply
AACSB: Analytic Skills
67) When selecting a city, a small business owner needs to ask questions about the wage rates,
the business climate, and proximity to markets and raw materials, in order to properly analyze
the city.
Topic: Selecting the City
AACSB: Analytic Skills
68) The trends or shifts in population components, such as population age, have more meaning
for the small business owner than total population trends.
Topic: Selecting the City
AACSB: Analytic Skills
16
69) To calculate the IRS, a retailer needs to know the number of customers in the area, the retail
expenditures for his/her product, and the total square feet of space allocated to selling his/her
kind of product in the trading area.
Topic: Trade Area Size
AACSB: Reflective Thinking
70) Local laws, zoning regulations and building codes can affect the location to be chosen
depending on the type of business and its particular requirements.
Topic: Local Laws and Regulations
AACSB: Analytic Skills
71) Criteria for a “good location” are universal and apply to all types of small businesses.
Topic: The Final Site Selection
AACSB: Analytic Skills
72) One element of the location decision common to all businesses is the need to locate where
customers wish to do business.
Topic: The Final Site Selection
AACSB: Analytic Skills
73) The three factors that influence the size of the retail trading area are: type and price of
products, type of the business, and the demographics of the area.
Topic: Trade Area Size
AACSB: Analytic Skills
74) When doing a traffic count, the total number of shoppers passing by is the critical factor in
evaluating the site.
Topic: Customer Traffic
AACSB: Analytic Skills
75) Central business districts have convenient and safe parking.
Topic: Central Business District
AACSB: Analytic Skills
17
76) When in doubt, shopping centers are always a wise location for a small business to choose.
Topic: Shopping Centers and Malls
AACSB: Analytic Skills
77) The typical neighborhood shopping center contains from 3 to 12 stores, with a supermarket
or drug store as its “anchor.”
Topic: Shopping Centers and Malls—Neighborhood or Lifestyle Shopping Centers
AACSB: Analytic Skills
78) It is critical for all retail and service businesses to be located as far from competitors as
possible.
Topic: Near Competitors
AACSB: Analytic Skills
79) For a small business, an airport is a nontraditional location.
Topic: Nontraditional Locations
AACSB: Analytic Skills
80) Home-based businesses represent nearly 50% of all newly created small businesses.
Topic: Home-Based Businesses
AACSB: Analytic Skills
81) A foreign trade zone is a specially designed area that allows resident companies to import
from foreign countries what they need to do their business and ship finished products out with
minimal tariffs, etc.
Topic: Foreign Trade Zone
AACSB: Analytic Skills
82) An “incubator” is a facility with low rent that permits start-up small businesses to share
resources.
Topic: Business Incubators
AACSB: Analytic Skills
18