Archives: Quiz

When a seller sells on credit and is given a security interest in the goods, that interest is called: a. a purchase money security interest. b. a future transaction. c. a floating lien. d. none of the above. When a […]

When money is loaned at a greater rate of interest than is allowed by law, __________ is committed. a. Usury b. credit misfeasance c. petty theft d. credit malfeasance An apparently voluntary agreement may in fact not be voluntary if: […]

What is an employer defense to a disparate impact charge? a. The employer did not intend to discriminate. b. The employment practice is job-related and consistent with business practice. c. The disparate impact was not the result of extreme recklessness […]

When a defendant asserts that even if everything the plaintiff said is true there is no right to recovery, the defendant is making a: a. counterclaim. b. motion to dismiss. c. motion for summary judgment. d. deposition. A person becomes […]

In an employment contract, agreements not to compete are: a. illegal b. uniformly held to be in the public interest and therefore legal c. valid only if the restriction protects the employee d. valid, if the restriction is reasonable and […]

A partner’s authority to act for the partnership is similar to the authority of a(n): a. agent to act for a principal. b. independent contractor to act for an employer. c. shareholder to act for a corporation. d. employee to […]

A gift causa mortis is revoked if: a. the donor does not die. b. the donor revokes the gift before dying c. the donee dies before the donor. d. all of the above. A sole proprietorship is taxed: a. only […]

What type of damages is recoverable when the defendant€s tortious conduct is accompanied by fraud, malice, or willful or wanton conduct? a. compensatory b. consequential c. nominal d. punitive A valid meeting of the voting shareholders of a corporation requires […]

The willingness of an offeror to enter into a contractual agreement regarding a particular subject is expressed by a(n): a. offer. b. acceptance. c. contract. d. agreement. The goal of the North American Free Trade Agreement (NAFTA) is to eliminate […]

Which of the following is a defense to an action against an agent for breach of the implied warranty of authority? a. The agent acted in good faith. b. The agent misunderstood the scope of authority. c. The third person […]

The first action generally attempted by the EEOC is: a. litigation. b. conciliation. c. mediation. d. arbitration. An employer may be liable on the theory of negligent hiring: a. when it is shown the employer knew the employee would create […]

Compensatory damages: a. compensate consumers for their actual loss. b. are imposed to punish the defendant for wrongdoing. c. both a. and b. d. none of the above. A successor enterprise is not subject to the contract obligations of the […]

A partner may withdraw from the partnership without liability: a. unless the withdrawal violates the partnership agreement. b. when the partnership is not for a definite purpose. c. when the partnership is not for a definite time. d. all of […]

Under Regulation D, Rule 506, sales may be made to: a. an unlimited number of accredited investors b. an unlimited number of unaccredited investors c. no more than 500 accredited investors d. no more than 35 unaccredited investors The situation […]

__________ refers to laws and precedent applicable to Internet transactions and communications. a. Cyberlaw b. Cyborglaw c. Silicalaw d. Simlaw Agreements that are illegal are: a. enforceable if one party acted in good faith. b. voidable by one of the […]

Eligibility for membership on a board of directors is determined by all of the following except: a. statute. b. certificates of filing. c. articles of incorporation. d. bylaws. Action taken by one on behalf of another is: a. agency. b. […]

An agent who commits a crime is: a. always liable. b. only liable if acting in self-interest. c. only liable if the act is done to advance the interest of the principal. d. never liable when acting in the role […]

Isidro issued a negotiable promissory note to his attorney in return for the attorney’s promise to perform legal services. The attorney never rendered the legal services but quickly negotiated the note to Anna, a holder in due course. Anna and […]

In interpreting an ambiguous contract, one part of the contract: a. must be viewed in isolation. b. must be viewed as a condition. c. must be viewed in connection with the rest of the contract. d. must be viewed as […]

Which of the following parties has the power to bind an organization to a contract? a. A soliciting agent for the organization. b. A contracting agent for the organization. c. A sales agent for the organization. d. None of the […]

What is the purpose of a financing statement? a. to meet UCC accounting requirements under Article 9 b. to create a security interest c. to amend a security agreement d. to alert third persons that a creditor has a security […]

Consumer leases: a. must always be evidenced by a writing. b. are always three- party transactions. c. require the lessor to make all usual warranties made by a seller in a sale of goods.. d. all of the above. __________ […]

Some states have rejected the requirement of privity but not adopted any set rule. Instead, these states function under the __________ rule. a. known user b. contact c. flexible d. foreseeable user An individual who desires to make provisions that […]

The General Agreement on Tariffs and Trade (GATT): a. is a multilateral treaty b. is subscribed to by the United States c. has as its goal the liberalization of world trade d. all of the above A tenant in possession […]

Between 2005 and 2011, Blue Drink Company increased its net profit from $5 million to $25 million. It was able to do this by expanding its product line to include a wider variety of drink flavors as well as introducing […]

A typical matrix organizational structure is A.flat and decentralized. B.flat and centralized. C.tall and decentralized. D.tall and centralized. E.none of these. Pursuing strategies that maximize the long-run profitability and profit growth of a company benefits which group(s) of stakeholders? A.Employees […]

____ can help an organization overcome inertia. A.Power struggles B.Capabilities C.Prior strategic commitments D.A crisis E.The Icarus paradox To be commercially successful, new products must be developed with ____ utmost in mind. A.manufacturing requirements B.engineering technology C.customer requirements D.sales techniques […]

When companies become too tall and the chain of command too long, strategic managers tend to lose control over the hierarchy and, subsequently, their strategies. A price-cutting strategy will keep out an entrant that plans to adopt a new production […]

Differentiation leads to high brand loyalty, which in turn significantly increases the threat of new firms entering the industry. Honda redefined the U.S. motorcycle industry with a brilliantly conceived intended strategy. Answer: FALSE Clothing companies Aeropostale and Forever 21 compete […]

A product’s appeal to customers’ psychological desires cannot be considered a source of differentiation. Factor endowments-the cost and quality of factors of production-are a prime determinant of the competitive advantage that certain countries have in certain industries. Answer: TRUE A […]

An effective governance arrangement exists when the CEO is also the chair of the board of directors. If a company generates free cash flow, that money technically belongs to shareholders. Answer: TRUE Flat structures can lead to information distortion when […]

The term information asymmetry describes the difference in personal ethics that agents and principals have. Few integrating mechanisms are needed when a company uses a global-area structure. Answer: TRUE Market penetration involves the creation of new or improved products to […]

To be successful in a growth industry, it is important to remain focused on the needs of the early adopters of the new product. When a company licenses its technology it can quickly lose control over it. Answer: TRUE An […]

The Cott Corporation, in the soft drink industry, is an example of how a company failed to overcome barriers to entry in an industry. Poor positioning strategy arises when a company introduces a potentially attractive new product but sales fail […]

A business model is managers’ conception of how the set of strategies their company pursues should mesh together into a congruent whole, thus enabling the company to gain a competitive advantage and achieve superior profitability and profit growth. The building […]

One of the factors that distinguishes organizations in the nonprofit sector from for-profit businesses is the lack of concern for strategic management. To foster the development of the matrix-in-the-mind concept and promote cooperation, companies are increasingly making use of the […]

At Burger King, multiple items such as a cheeseburger, french fries, and a drink are combined together to create a complete meal. This is an example of diversification. One assumption of agency theory is that the principals have more information […]

ROIC is a measure of how efficiently and effectively managers use the capital at their disposal to produce profitability. Phil is an employee at Global Tech, Inc. He is considered an external stakeholder. Answer: FALSE The importance of reliability in […]

Control systems can help managers evaluate how efficiently they are producing goods and services. Wal-Mart is a large, complex organization. It most likely utilizes a flat organizational structure. Answer: FALSE A differentiation business model is based on pursuing a set […]

High tech industries are often dependent on complementor industries for their mutual success. The best part of global strategic alliances is that selection of the right partner does not affect success of the alliance. Answer: FALSE The more utility a […]

Research finds that centralization of authority is never advantageous, not even in time of crisis. Strategic group analysis allows managers to focus only on what is happening in their group. Answer: FALSE Control through culture is so powerful because once […]

If a company’s profitability is higher than the industry average, it has a competitive advantage. Southwest Airlines, Sony, and Costco conduct business in two or more countries. These companies are referred to as multinational companies. Answer: TRUE A fragmented industry […]

An appropriate reason to diversify is to pool the risk from several business ventures in order to create a more stable income stream. General managers bear responsibility for the overall performance of the company or for one of its major […]

A divestment strategy’s success is often dependent upon good timing. Digital music downloads have high marginal costs. Answer: FALSE At Adam’s bicycle repair shop, the primary value chain activity of production occurs each time a customer’s bicycle is repaired. Answer: […]

Poor commercialization occurs when there is definite customer demand for a new product, but the product is not well adapted to customer needs because of factors such as poor design and poor quality. An international strategy may not be viable […]

One advantage of a joint venture is that a company may benefit from a local partner’s knowledge of the many dimensions of a host country. In 1995, Dell Computer changed its organization structure from a market structure to a functional […]

The need for integrating mechanisms is greater when a company’s structure is more complex. Most manufacturing companies begin their global expansion by exporting. Answer: TRUE Fortunately, focusers are not vulnerable to shifting consumer tastes, because of brand loyalty that comes […]

If consumer tastes change and a focuser’s niche disappears, the danger for the focuser is that it might have difficulty shifting resources from its niche to another market segment. An advantage of related diversification is that it allows a company […]

Cypress Semiconductor utilizes a computer-based information system. Such a system would allow managers to manage what employees and teams do in this decentralized organization. Toyota’s lean production system is the basis of its competitive advantage. Answer: TRUE A company may […]

It is important for corporate managers to be able to identify high-performing and underperforming divisions and to take corrective action as necessary. Access to cheaper capital is an example of an economy of scale. Answer: FALSE A company searching for […]