Premiums for product liability coverage have been declining steadily over the last
several years.
A corporation is considered by law to be a unique entity, separate and apart from those
who own it.
In the context of small businesses, franchises tend to fail because of not having enough
money to cover all needs.
Affirmative action programs help to put the principle of equal employment opportunity
into practice.
For small firms, outputs are materials, people, money, information and other productive
factors.
Merit increase is the extra compensation paid for all production over a specified
standard amount.
Employees are not a good source of information about customer preferences as they are
usually trying to sell the product.
When regulations are imposed on one industry or business, they often create
opportunities for other small entrepreneurs.
Security software is available for all system sizes.
Marketing objectives need not be tied in with the business’s competitive edge.
Which of the following best describes a collection period ratio?
a) Long-term liability divided by working capital
b) Accounts receivable divided by average daily credit sales
c) Net income divided by average shareholders’ equity
d) Net profit divided by net sales
Which of the following is true about the board of directors of a corporation?
a) They represent the stockholders in managing the company.
b) They direct the day-to-day operations of the business.
c) They elect to form the executive committee.
d) They have a controlling interest in the corporation.
_____ is the concept that two or more people, working together in a coordinated way,
can accomplish more than the sum of their independent efforts.
a) Duality
b) Due diligence
c) Niche marketing
d) Synergy
Which of the following is a characteristic of a pure risk?
a) It cannot be analyzed statistically.
b) It is typically uninsurable.
c) It exists when the possibility of a loss is present but the possible extent of the loss is
unknown.
d) It refers to the uncertainty as to whether a voluntarily undertaken activity will result
in a gain or a loss.
A penetration price refers to:
a) the high prices set by fur retailers.
b) a published price that remains the same for a long time.
c) a different price level set for different lines of merchandise.
d) a price set relatively low to secure market acceptance.
Which of the following is true about the first stage of the growth pattern that small
businesses tend to follow?
a) Owners manage the business and do all the work
b) Owners still manage their companies but hire employees to help with routine and/or
management activities
c) Owners hire managers to run the firms
d) Owners outsource much of the supervisory work
Which of the following does a business incubator do to help small business owners
succeed?
a) Find out the competition and make deals for cooperation
b) Provide management assistance & shared office services
c) Hire their employees and train them
d) Keep their financial records up-to-date
_____ is the amount added to the cost of the product to determine selling price.
a) Push money
b) Markup
c) Marginal value
d) Going rate
_____ is a body of laws passed by federal, state, and local governments.
a) Common law
b) Police law
c) Judicial law
d) Statutory law
Which of the following constitutes shoplifting?
a) Sally, a young woman, stole an expensive brooch from a departmental store and hid
it in her handbag.
b) Robert, a habitual offender, set fire to a shop owned by his rival’s family.
c) Gina, an accountant, embezzled funds from her company’s account.
d) Mark, a teenager, stole money from his mother’s purse for buying cigarettes.
In the context of small businesses, what is the difference between accounts receivable
and accounts payable?
What are the ways to improve communication?
List some of the factors contributing to a firm’s poor performance.
State three examples of strategic planning for a small business owner.
Explain why people start small businesses.
Why do business owners work to motivate their employees?
What are some of the factors that should be considered when choosing the proper legal
form for a business?
What are franchisee fees and royalty fees?