Chapter 1—Economics and Management Key
1. The Dodd-Frank law
2. On average each year, about 7 percent of all firms in the United States are new, and 1 percent go out of
business. According to the text, which of the following is not true?
3. On average each year, about 7 percent of all firms in the United States are new and 1 percent go out of
business. According to the text, luck may play a role. Which of the following reasons for failure might be
attributable to luck?
4. A focus on quality means:
5. Being a first mover means:
6. If large, dominant firms tend to be more successful and last longer than small, non-dominant firms, it would
be because:
7. Firms will merge or one firm will acquire another for all but which of the following reasons:
8. Globalization does not mean:
9. According to the text, success requires:
10. According to the text, economics offers the business person
11. A Basic principle of economics is:
12. “Knowing your customer” means:
13. According to the text, “economics tempers the enthusiasm of a manager to focus on the customer” because
14. Core competency implies:
15. TQM means
16. According to the text, many firms who adopt TQM find that
17. There is no free lunch means
18. According to the text, the essence of good management is:
19. According to the text, economic decision making refers to:
20. According to the text, tradeoffs
21. To an economist, the word ‘marginal’ means:
22. Generally, marginal costs ____ as quantity increases?
23. Net social benefits are maximized when:
24. Business success is largely dependent on
25. First movers
26. Mergers and acquisitions
27. If firms focus on quality
28. Popular management jargon includes
29. The essence of good management is to determine whether a new practice adds
30. Economic decision making recognizes that
31. The Dodd-Frank bill is new financial regulation.
32. The Dodd-Frank bill led to the financial meltdown of 2008.
33. While a focus on quality can lead to business success, its development is not free.
34. First movers are also product innovators.
35. Having a large market share is one of the main ingredients to business success.
36. Marginal benefits and total benefits are equal when net total benefits are maximized.
37. Evidence suggests that mergers and increased profitability do not necessarily go hand in hand.
38. Over a twenty-five year period, about half of the merger acquisitions are split up.
39. There are few truly global brands.
40. Globalization leads to a homogenizing of markets.
41. The personality of the business leader is necessary for a firm’s success.
42. Economics can be viewed as a way to think about problems.
43. To an economist, all choices have costs.
44. A good bit of management jargon often simply symbolizes fundamental economic analysis.
45. To know the customer is to understand costs.
46. Good management always seeks to add value.
47. To be the best at everything is possible.
48. Net total benefits of an activity are maximized when marginal benefits and marginal costs are equal.
49. Business decisions can be made by focusing mainly on the benefits of a decision because most costs are
fixed.
50. Business decisions must be undertaken with a view of comparing the costs of the decision with its benefits.