Nowadays, smaller firms are exempt from many federal regulations and even some
state and local ones.
A website’s context focuses on how a site is designed and captures its aesthetic and
functional look-and-feel.
Test marketing a product is a cost-effective way to do primary research.
A buy-sell agreement states what a business can do and provides other organizational
and financial information.
In a given market area, the fact that a high number of similar firms have gone out of
business usually signals market weakness.
A negative cash balance requires an increase in payments and decrease in cash receipts.
Variable expenses rise in direct proportion to increase in sales volume.
Suppliers should be chosen on the basis of price alone.
Job scheduling is done immediately after the first transaction.
As the leader of a family-owned business grows older, he/she must guard against
depending on past successes.
Personal failures are more common than formal failures.
In the United States, partnerships produce the most revenue.
A small business provides employees with a variety of learning experiences not open to
individuals holding more specialized jobs in larger companies.
Making daily cash deposits and varying the deposit time from day to day are highly
recommended to keep the probability of armed robberies down.
Small businesses are rarely targeted by hackers and other criminals.
What is the difference between bonus and commission?
a) Bonus is a reward not specified in advance whereas commission is a reward of a
given amount per sale.
b) Bonus is a form of merit increases whereas commission is a form of incentive.
c) Bonus is useful in rewarding door-to-door selling whereas commission is useful for
rewarding on special occasions.
d) Bonus is based on seniority whereas commission is based on contributions to the
company’s profits.
What is the significance of flextime as a motivator for employees?
a) It gives employees greater control over their time and activities.
b) It permits employees to work at times other than the standard work week or days.
c) It allows employees to divide a full-time job into distinct parts.
d) It allows employees to share a full-time job with other employees.
A(n) _____ shows the authority and responsibility relationships that exist in a business.
a) informal organization
b) job specification
c) organization chart
d) job description
While working in a fast food outlet, Harold observed that most of the customers were
working in offices in the neighborhood. Sensing a profitable opportunity, he decided to
open a lunch catering business. He offered to deliver lunch directly to the offices so that
the businessmen would not have to interrupt their meetings to go somewhere for lunch.
In the context of the above scenario, which of the following was the reason for Harold
to start his own business?
a) To obtain fresh inventory
b) To take advantage of the latest technology to fill a void
c) To select a competitive environment
d) To have a free hand in selecting personnel
____ goods are are usually high-priced goods with trade names that are recognized for
the exclusive nature of their clientele.
a) Convenience
b) Shopping
c) Specialty
d) Seasonal
Which of the following is a strategy used by companies with a reputation for superior
marketing?
a) Uniform pricing for all products
b) Low customer engagement
c) Attention to packaging
d) Waging price wars with competitors
A(n) _____ periodically shows revenues, expenses, and profits from a firm’s operations.
a) balance sheet
b) statement of retained earnings
c) income statement
d) cash flow statement
Current assets are expected to _____.
a) turn over
b) remain unchanged with respect to its form
c) deplete rapidly within a year
d) be primarily intangible
Which of the following provisions requires policyholders to buy insurance in an amount
equal to a specified percentage of the property value?
a) Prize indemnity insurance provision
b) Coinsurance provision
c) Self-insurance provision
d) Basic insurance provision
What does a buy-sell agreement do?
a) It states what the business can do and provides other financial information.
b) It details the terms by which stockholders can purchase each other’s interest.
c) It shows the rights, duties, and responsibilities of each partner.
d) It oversees the usage of an expensive asset.
What is the function of problem-solving teams?
a) They meet for an hour or two a week to discuss ways to improve quality, efficiency,
and the work environment.
b) They take over some managerial duties and produce an entire product.
c) They are formed to monitor, standardize, and improve work processes that cut across
different parts of the organization.
d) They are formed to develop products and to address issues that need expertise.
Describe personal services and business services.
What are the benefits of selling a family business to family members and the benefits of
selling the business to outsiders?
Describe the two types of risks that small business owners face.
What are the different types of insurances that a small business owner mostly needs?
What are the different ways of coping with risk?
What is the purpose of small business investment companies?
Describe how a family-owned business may prepare for management succession in case
the owner departs suddenly.
What is fractional ownership?