How Machine Learning Is Helping Neuroscientists Crack Our Neural Code        
A big challenge in neuroscience is understanding how the brain encodes information. Neural networks are turning out to be great code crackers.
          ä¸å®šæœŸML&NLPå ±#3        

最近の機械学習&自然言語処理に関する情報をまとめるコーナーです。前回はこちら。このエントリ忘れてるよというのがありましたら、たれこみフォームから教えてもらえるとうれしいです。

論文

  • [1701.00160] NIPS 2016 Tutorial: Generative Adversarial Networks
    • 最近流行りのGANのNIPSでのチュートリアル論文(資料)
  • [1612.08220] Understanding Neural Networks through Representation Erasure
    • 深層学習の解釈性に関する研究。線形モデルのように重みの絶対値だけでは重要度が分からないので、重みが全部入っているときとある次元dの重みを0にしたとき(erase)の負の対数尤度の差を見ることで、ある次元dの重要度をはかろうというアプローチのようだ

ブログ/勉強会資料

ビジネス

ペパボのログ解析。データの収集、可視化、パス分析をやった結果をどう施策に活用していくか(離脱ユーザーへのリテンション)。

学会/勉強会

「HOME'Sデータセット」を活用した不動産物件画像への深層学習の適用の取り組み from Yoji Kiyota

WebDB Formでの発表資料。深層学習を使った間取りの生成、物件画像の分類(玄関、居間、キッチン、トイレなどの分類)など。不動産物件のデータセットの提供もあって熱い。

NIPS2016

NL研

深層リカレントニューラルネットワークを用いた日本語述語項構造解析 from Hiroki Ouchi

NL20161222invited from Tetsuya Sakai
招待講演の酒井先生の発表資料。うーん、あまりできていないので耳が痛い...。情報アクセス評価方法論を出されたようなので、これを読んでみるとよさそう?

coling2016

第8回入力メソッドワークショップ (IM 2016)

毎年年の瀬に行なわれているIME関係の集まり。来年はきっと京都であると思うので、参加したい。

その他

機械学習のための連続最適化 (機械学習プロフェッショナルシリーズ)

機械学習のための連続最適化 (機械学習プロフェッショナルシリーズ)

関係データ学習 (機械学習プロフェッショナルシリーズ)

関係データ学習 (機械学習プロフェッショナルシリーズ)


          ä¸å®šæœŸML&NLPå ±#1        

先日、社内で定期的に行なわれているフロントエンド会にお邪魔してきました(podcastが配信されています)。jser.infoというサイトを参照しながら雑談していたのですが、最近のフロントエンドの動向を知るという目的にはこのサイトなかなかよさそうでした。

機械学習勉強会でもランチタイムに最近の話題を見ながら雑談しているのですが、ネタになるエントリ一覧とそれに対するコメントは社外に公開して別に問題ないなと思ったので、不定期報という形で出してみることにしました。自然言語処理も自分がカバーできる範囲限られているし、自然言語処理以外の機械学習の話はかなりカバーできないので、たれこみフォームも作りました。耳寄りな情報、お待ちしております:)

論文

ブログ/勉強会資料

ビジネス

学会/勉強会

Coling2016

今年は大阪で開催。

NIPS2016

NL研(第229回自然言語処理研究会)

(2) [NLC] ゲーミフィケーションを利用した効率的な対話ログ収集の試み
○叶内 晨・小町 守(首都大東京)

データが集まると学習する方法はいくらでも出てきているので、データをどうやって効率よく集めていくのかというところに興味がある。

(5) [NL] 雑談対話システムの話題遷移における自然性の自動評価
○豊嶋章宏(NAIST)・杉山弘晃(NTT)・吉野幸一郎・中村 哲(NAIST)

(20) [NL] 14:30 – 15:00
単語分散表現を用いた単語アライメントによる日英機械翻訳の自動評価尺度
○松尾潤樹・小町 守(首都大)・須藤克仁(NTT)

データ収集と合わせて解析系でないタスクの評価は今後ホットなタスクになると思ってます。

(15) [NL] 17:25 – 17:55
単語分かち書き用辞書生成システム NEologd の運用 — 文書分類を例にして —
○佐藤敏紀・橋本泰一(LINE)・奥村 学(東工大)

最近各地で使われることが多くなってきたNEologdの話もあった。

言語処理学会2017

チュートリアルとテーマセッション、ワークショップの内容も出ていました。

クラウドソーシング
馬場 雪乃 先生(京都大学)
ニューラル機械翻訳
中澤 敏明 先生 (JST)
Universal Dependencies
金山 博 先生(日本IBM東京基礎研究所)
田中 貴秋 先生(NTTコミュニケーション科学基礎研究所)
認知言語学
西村 義樹 先生(東京大学)

ニューラル機械翻訳とUniversal Dependenciesが特に気になっている。

IM飲み2016

その他


          è‡ªç„¶è¨€èªžå‡¦ç†ã®æ·±å±¤å­¦ç¿’において転移学習はうまく行くのか?        

このエントリはDeep Learning Advent Calendar 2016 5日目のエントリです。EMNLP2016に出ていたHow Transferable are Neural Networks in NLP Applications?を読んだので、それについて書きます。

モチベーション

画像方面では、あるタスク(source side)で学習させた深層学習の結果を、別データセット(target side)でソフトマックス層だけ再学習させる転移学習(Transfer Learning)がうまくいっていると報告されています。

あるタスクでうまくいった深層学習の重みやネットワーク構造を他のタスクに適用させることができれば

  • 再学習の手間が減る
  • source sideのおかげで、target sideで学習させるデータ量も少なめでもよい精度を出る(ことが期待できる)
  • 深層学習で問題になりやすい過学習の問題を回避しやすくなる

などのメリットがありそうです。深層学習が登場する以前から、自然言語処理の分野でも転移学習の研究はされていましたが(EasyAdapt、instance weighting、structural correspondence learningなどが有名。余談だが、特にEasyAdaptはむかつくほど簡単なのにうまく行く)、深層学習の場合では、うまくいったと報告している論文もあれば、あまり精度は向上しなかったと報告している論文もあります。

この論文は自然言語処理での深層学習の有効性について、システマチックに調査することを目的としています。これを調査するために複数タスクにおいて埋め込み層、中間層、出力層をそれぞれ転移させる/させないの組み合わせで実験した結果を報告しています。結果としては、画像ほどうまく行かないといった感じの結果になっているようでした。世の中甘くはなかった...。

実験設定

データセット

データセットは全部で6つ実験していますが、大きく分けるとSentence classificationのタスクとSentence-pair classificationのタスクに分かれます。それぞれのタスクにおいて、あまり難しいネットワーク構造は出てきません。

Sentence classificationのタスク

3つのデータセットからなります。

  • 文がpositiveかnegativeかを分類させるタスク(IMDB、MR)
  • 文が場所、時間、数など(6種類)のどれについて聞いているかを分類させるタスク(QC)

の2つです。IMDB => MRで転移学習させる際は意味的に似たタスクを解かせていることになりますが、IMDB => QCだと意味的に大分違うタスクを解かせていることになります。

解かせる方法は基本的なLSTMで、最後にsoftmaxでどれかのクラスを吐く構造です。論文よりネットワーク構造の図を引用します。

f:id:syou6162:20161204234925p:plain

Sentence-pair classificationのタスク

3つのデータセットからなります。

  • 文のペアのentailmentを認識させるタスク(SNIL、SICK)
  • 2つの文が同じ意味を持つかどうかを当てるタスク(MSRP)

解かせる方法はCNNベースの方法で、そんなに凝った方法ではありません。ネットワーク構造の図(論文より引用)を載せておきます。

f:id:syou6162:20161204234945p:plain

転移学習の方法

これも大きくわけで2つ用意しています。まず1つ目は転移学習の一般的な方法でsource sideで学習した結果をtarget sideで使うという方法(INIT)。今回の実験の場合はsource sideで学習したものをtarget sideの初期値として利用するというものです、それだけ。2つ目は転移学習というよりはマルチタスク学習として解く方法(MULT)。目的関数をそれぞれのタスクの線形和でつないだものを一度に学習させます。

論文ではMULTとINITを組み合わせた方法でも実験されていますが、それほどうまく行っていないので省略します。

結果

論文では色々結果が書いてありますが、全部書いていると長くて疲れるので要点だけまとめます。あまりいい感じの実験結果ではないですが、知見が共有されたという感じの論文かな...。

  • 自然言語処理の深層学習で転移学習がうまく行くかどうかはタスクが意味的にどれくらい似ているかにかなり依存する
    • 似ていないタスクだとかえって下がることもある
  • 出力層はほとんど転移できないものだと思っておいてよい。一方、単語の埋め込み層は意味的に異なるタスクであってもそこそこ転移がうまくいきやすい
  • MULTとINITの組み合わせはそんなによくならなかった

参考

深層学習 Deep Learning (監修:人工知能学会)

深層学習 Deep Learning (監修:人工知能学会)

  • 作者: 麻生英樹,安田宗樹,前田新一,岡野原大輔,岡谷貴之,久保陽太郎,ボレガラダヌシカ,人工知能学会,神嶌敏弘
  • 出版社/メーカー: 近代科学社
  • 発売日: 2015/11/05
  • メディア: 単行本
  • この商品を含むブログ (1件) を見る


          51) Which one of the following statements concerning production and staffing plans is best? A. A master production schedule is a projected statement of income, costs, and profits. B. Aggregation can be performed along three dimensions: product families, labor, and time. C. Production plans are based primarily on information from the master production plan. D. A staffing plan is the intermediate link between the business plan and the master production schedule.         

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that: A. you would lose $80 if one of your workers missed an entire 8 hour shift. B. the next worker that offers to work an extra 8 hours should receive at least $80. C. you would be willing pay up to $60 for someone to work another 6 hours. D.         

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel. A. physical, digital B. e-commerce, digital C. physical, financial D. digital, e-commerce E. digital, physical        

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          54) When customers access a Web site and make purchases, they generate __________. A. Tracking cookies B. Web data C. Information D. Clickstream data E. Hyperlink data        

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information. A. regionalization B. globalization C. nationalization D. business environment         

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          56) Various organizations that promote fair and responsible use of information systems often develop __________. A. a code of ethics B. responsibility charters C. a strategic plan D. a mission statement E. a goals outline        

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          57) What is _____ is not necessarily _____. A. Illegal, unethical B. Unethical, legal C. Ethical, illegal D. Unethical, illegal E. Ethical, legal        

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          58) _____ provides users with a view of what is happening, where _____ addresses why it is happening. A. Multidimensional data analysis, structured query language B. Multidimensional data analysis, neural networks C. Data mining, multidimensional data analysis D. Data mining, expert system E. Multidimensional data analysis, data mining        

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          59) Computer support is greatest for which of the following problems? A. Semistructured and strategic planning B. Semistructured and management control C. Unstructured and operational control D. Structured and operational control E. Structured and management control        

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          60) The management cockpit best exemplifies which type of system? A. Decision support system B. Functional area information system C. Expert system D. Digital dashboard E. Group decision support system        

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          61) _____ is the efficient and effective execution of specific tasks. A. Operational control B. Expertise C. Management control D. Strategic planning E. Wisdom        

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          62) Geocoding is __________. A. accessing geographical information B. integrating maps with spatially oriented databases and other databases C. integrating organizational transactions with spatially oriented databases D. programming spatially oriented databases E. encrypting spatial information        

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          63) At 8% compounded annually, how long will it take $750 to double? A. 48 months B. 6.5 years C. 9 years D. 12 years        

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period? A. Cash flow statement B. Balance sheet C. Income statement D. Quarterly statement        

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.
83) A cluster analysis of the "toothpaste market" would probably show that:
A.   the broad product-market can be served effectively with one marketing mix.
B.   most consu
          65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.) A. $570 B. $490 C. $900 D. -$150         

BUS/475 Guide 4


1) The cost principle requires that when assets are acquired, they be recorded at __________.
A.   list price B.   selling price C.   exchange price paid D.   appraisal value
2) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
A.   have been approved for use by the managements of business firms
B.   have been approved by the Internal Revenue Service C.   have substantial authoritative support D.   are proven theories of accounting
3) The standards and rules that are recognized as a general guide for financial reporting are called __________.
A.   standards of financial reporting B.   operating guidelines C.   generally accepted accounting principles D.   generally accepted accounting standards
4) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
A.   $8,250
B.   $750 C.   $4,500
D.   $5,250
           
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?
A.   2,133 units
B.   6,200 units
C.   $25,600 D.   4,600 units
           
6) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
A.   The western division’s vice president’s salary
B.   Cost of landscaping the corporate office C.   General corporate liability insurance D.   Factory janitor
7) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A.   Master budgeting analysis
B.   Exception reporting C.   Responsibility reporting
D.   Static reporting
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?
A.   $6,000 B.   $12,000
C.   $28,000
D.   $18,000
           
9) The cost of an asset and its fair market value are __________.
A.   never the same B.   irrelevant when the asset is used by the business in its operations
C.   the same on the date of acquisition D.   the same when the asset is sold
10) Which one of the following is a product cost?
A.   Indirect labor B.   Sales person’s salaries
C.   Advertising costs D.   Office salaries
11) What exists when budgeted costs exceed actual results?
A.   A budgeting error B.   An unfavorable difference
C.   An excess profit D.   A favorable difference
12) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
                        Income Statement                  Balance Sheet
            Dr.       Cr.                   Dr.       Cr.
Totals              $58,000           $48,000                       $34,000           $44,000
           

Closing entries are necessary for __________.
A.   permanent accounts only B.   both permanent and temporary accounts
C.   permanent or real accounts only D.   temporary accounts only
13) Managerial accounting __________.
A.   is concerned with costing products B.   pertains to the entity as a whole and is highly aggregated
C.   places emphasis on special-purpose information D.   is governed by generally accepted accounting principles
           
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?
A.   Beer B.   Selling either results in the same additional income for the company
C.   It should sell an equal quantity of both D.   Wine
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
A.   saver who demands money from the financial system B.   borrower who demands money from the financial system
C.   borrower who supplies money to the financial system D.   saver who supplies money to the financial system
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A.   the value to Maurice of the option he would have chosen had Option B not been available
B.   $100 C.   $300 D.   the value to Maurice of Options A, C and D combined
17) A production possibilities frontier will be a straight line if __________.
A.   the economy is producing efficiently B.   the economy is engaged in trade with at least one other economy C.   increasing the production of one good by x units entails no opportunity cost in terms of the other good
D.   increasing the production of one good by x units entails a constant opportunity cost in terms of the other good
           
18) In economics, the cost of something is __________.
A.   what you give up to get it B.   often impossible to quantify, even in principle C.   the dollar amount of obtaining it D.   always measured in units of time given up to get it
           
19) A tax on an imported good is called a __________.
A.   supply tax
B.   trade tax C.   quota D.   tariff
20) Which of the following statements about GDP is correct?
A.   GDP is to a nation’s economy as household income is to a household. B.   GDP increases if the total population increases. C.   GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
D.   Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
           
21) In computing GDP, market prices are used to value final goods and services because __________.
A.   if market prices are out of line with how people value goods, the government sets price ceilings and price floors
B.   Market prices are not used in computing GDP C.   market prices reflect the values of goods and services D.   market prices do not change much over time, so it is easy to make comparisons between years

22) Which of the following statements about GDP is correct?
A.   Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process.
B.   Nominal GDP consistently underestimates the value of production, whereas real GDP consistently overestimates the value of production.
C.   Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
D.   Nominal GDP values production at constant prices, whereas real GDP values production at current prices.
           
23) Which of the following is not correct?
A.   The U.S. debt per-person is large compared with average lifetime income.
B.   In 2005, the U.S. government had a deficit. C.   A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth.
D.   Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so.
           
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A.   balance of trade. B.   financial and capital account.
C.   government financial account.
D.   current account.
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004. One of their contributions was to argue that if a central bank could convince people to expect zero inflation, then the Fed would be tempted to raise output by increasing inflation. This possibility is known as __________.
A.   the sacrifice ratio dilemma B.   the monetary policy reaction lag
C.   the time inconsistency of policy
D.   inflation targeting
26) In general, the longest lag for __________.
A.   fiscal policy is the time it takes to change policy, while for monetary policy the longest lag is the time it takes for policy to affect aggregate demand
B.   both fiscal and monetary policy is the time it takes for policy to affect aggregate demand
C.   monetary policy is the time it takes to change policy, while for fiscal policy the longest lag is the time it takes for policy to affect aggregate demand
D.   both fiscal and monetary policy is the time it takes to change policy
27) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A.   Only item (2) is included in GDP and it is included in the investment component.
B.   Item (1) is included in the consumption component, while item (2) is included in the investment component.
C.   Item (1) is included in the investment component, while item (2) is included in the consumption component.
D.   Both item (1) and item (2) are included in the consumption component of GDP.

28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A.   Professional B.   Interpersonal and communication
C.   Technical D.   Professional E.   Conceptual and decision
29) Which of these represent skills that managers need?
A.   Interpersonal, quantitative, and professional B.   Technical, interpersonal & communication and conceptual & decision making
C.   Professional, technical and interpersonal & communication D.   Conceptual & decision making, professional and technical E.   Interpersonal & communication, conceptual & decision making and professional
           
30) Building a dynamic organization is another way of describing which function of management?
A.   Staffing B.   Organizing
C.   Leading D.   Controlling
E.   Planning
31) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?
A.   Anyone can start a business B.   All entrepreneurs need venture capital in order to get started C.   Successful entrepreneurs take very careful, calculated risks D.   Entrepreneurs are their own bosses and completely independent
E.   Money should not be considered a start-up ingredient
32) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is:
A.   Diversity B.   Managerial ethics
C.   Recruiting D.   Employment E.   Selection
33) A manager's ability to stimulate people to be high performers is referred to as:
A.   Planning B.   Supervising
C.   Controlling
D.   Organizing E.   Leading
34) A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of both producers and consumers is:
A.   Total quality management B.   Customer-based integration C.   Computer-integrated manufacturing (CIM)
D.   Just-in-time control (JIT)
E.   ISO 9000
35) Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain:
A.   A strategic alliance B.   A homogeneous workforce C.   Positive working relationships with all employees
D.   A Learning advantage over their competition E.   Larger, faster facilities
36) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered:
A.   Technical skills B.   Conceptual C.   Professional skills D.   Interpersonal/communication skills
E.   Diagnostic skills
37) The basic components of an effective sexual harassment policy include the following EXCEPT:
A.   To develop an organization wide policy on sexual harassment B.   To establish a means for ongoing training C.   To act immediately when employees complain of sexual harassment
D.   To establish a performance appraisal system E.   To establish a formal complaint procedure
38) Teams that operate separately from the regular work structure and exist temporarily are known as:
A.   Management teams B.   Transnational teams
C.   Self-managed teams
D.   Parallel teams E.   Self-designing teams
           
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A.   Goal Coordination
B.   Controlling C.   Organizing D.   Staffing E.   Planning
40) As related to managing of human resources, diversity refers to:
A.   Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
B.   Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C.   Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
D.   Differences in retention strategies (such as training, hiring, incentives, etc) E.   Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
           
41) __________ is the process of working with people and resources to accomplish organizational goals.
A.   Controlling B.   Decision making
C.   Planning D.   Supervising E.   Management
42) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
A.   3 B.   3.5
C.   2.5
D.   2
43) Use the following table to answer question:
 P(S | W) is approximately _____.
A.   .40
B.   .30
C.   .12
D.   .58
           
44) Use the following table to answer question:
 P(M  A) is approximately _____.
A.   .50 B.   .625
C.   .125
D.   .25
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
In determining the p-value for reporting the study's findings, which of the following is true?
A.   The p-value is equal to .05. B.   The p-value is greater than .05. C.   The p-value cannot be determined without specifying  . D.   The p-value is less than .05.
46) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen U.S. cities in 2005 with
Y = number of robberies in each city (thousands of robberies) and
X = size of police force in each city (thousands of police)?
A.   High R2 (due to city size). B.   Positive slope (due to city size).
C.   No correlation. D.   Autocorrelation.
47) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the “typical” student?
A.   Midrange
B.   Mean C.   Mode D.   Median
           
48) Likely reasons for inaccurate control limits would include which of the following?
A.   Process variation was not zero, as expected. B.   The engineering parameter for variance is unknown.
C.   There was insufficient preliminary sampling. D.   The engineers were underpaid for their work.
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y
and constraints of:
3X + 4Y = 24 (Constraint A)
5X – Y = 18 (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for Constraint B is 0. Which of these statements is TRUE?
A.   The most you would want to pay for an additional unit of A would be $7.50.
B.   You can change quantities of X and Y at no cost for Constraint B. C.   For every additional unit of the objective function you create, the price of A rises by $7.50.
D.   For every additional unit of the objective function you create, you lose 0 units of B.
           
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A.   The expected duration of this project is 25 + 15 + 20 = 60 days.
B.   A–D–C is the critical path. C.   The expected duration of this project is 25 days. D.   A–B–C has the most slack.
51) Which one of the following statements concerning production and staffing plans is best?
A.   A master production schedule is a projected statement of income, costs, and profits.
B.   Aggregation can be performed along three dimensions: product families, labor, and time.
C.   Production plans are based primarily on information from the master production plan.
D.   A staffing plan is the intermediate link between the business plan and the master production schedule.
           
52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:
A.   you would lose $80 if one of your workers missed an entire 8 hour shift. B.   the next worker that offers to work an extra 8 hours should receive at least $80.
C.   you would be willing pay up to $60 for someone to work another 6 hours.
D.   you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel.
A.   physical, digital B.   e-commerce, digital
C.   physical, financial D.   digital, e-commerce
E.   digital, physical
54) When customers access a Web site and make purchases, they generate __________.
A.   Tracking cookies B.   Web data C.   Information D.   Clickstream data
E.   Hyperlink data
55) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information.
A.   regionalization B.   globalization C.   nationalization D.   business environment
           
56) Various organizations that promote fair and responsible use of information systems often develop __________.
A.   a code of ethics B.   responsibility charters
C.   a strategic plan D.   a mission statement E.   a goals outline
57) What is _____ is not necessarily _____.
A.   Illegal, unethical B.   Unethical, legal C.   Ethical, illegal D.   Unethical, illegal
E.   Ethical, legal
58) _____ provides users with a view of what is happening, where _____ addresses why it is happening.
A.   Multidimensional data analysis, structured query language
B.   Multidimensional data analysis, neural networks C.   Data mining, multidimensional data analysis D.   Data mining, expert system E.   Multidimensional data analysis, data mining
59) Computer support is greatest for which of the following problems?
A.   Semistructured and strategic planning B.   Semistructured and management control
C.   Unstructured and operational control D.   Structured and operational control E.   Structured and management control
60) The management cockpit best exemplifies which type of system?
A.   Decision support system B.   Functional area information system
C.   Expert system D.   Digital dashboard E.   Group decision support system
61) _____ is the efficient and effective execution of specific tasks.
A.   Operational control
B.   Expertise C.   Management control
D.   Strategic planning E.   Wisdom
62) Geocoding is __________.
A.   accessing geographical information B.   integrating maps with spatially oriented databases and other databases
C.   integrating organizational transactions with spatially oriented databases D.   programming spatially oriented databases E.   encrypting spatial information
63) At 8% compounded annually, how long will it take $750 to double?
A.   48 months
B.   6.5 years C.   9 years D.   12 years
64) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A.   Cash flow statement
B.   Balance sheet C.   Income statement D.   Quarterly statement
           
65) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A.   $570 B.   $490 C.   $900 D.   -$150
           
66) Disadvantages of using current liabilities as opposed to long-term debt include:
A.   higher cash flow exposure B.   greater risk of illiquidity, and uncertainty of interest costs
C.   decreased risk of liquidity D.   certainty of interest costs E.   uncertainty of future liabilities
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A.   12.5% B.   36.13%
C.   8.0% D.   13.6%
68) Which of the following is most consistent with the hedging principle in working capital management?
A.   Fixed assets should be financed with short-term notes payable. B.   Inventory should be financed with preferred stock. C.   Accounts receivable should be financed with short-term lines of credit.
D.   Borrow on a floating rate basis to finance investments in permanent assets.
           
69) An increase in future value can be caused by an increase in the __________.
A.   original amount invested B.   annual interest rate and number of compounding periods
C.   rate of return D.   dividends paid E.   starting value
70) If the quote for a forward exchange contract is greater than the computed price, the forward contract is:
A.   at equilibrium.
B.   undervalued. C.   a good buy. D.   overvalued.
71) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt     8%
Cost of preferred stock           12%
Cost of common stock            16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A.   $1,568
B.   $871 C.   $1,241
D.   $463
72) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?
A.   The project’s IRR would have to be less that the firm’s discount rate. B.   The project would add value to the firm. C.   Under all conditions, the project’s payback would be less than the profitability index.
D.   In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.
           
73) The common stockholders are most concerned with:
A.   the spread between the return generated on new investments and the investor’s required rate of return.
B.   the size of the firm’s beginning earnings per share. C.   the risk of the investment. D.   the percentage of profits retained.
74) PepsiCo calculates unlevered betas for each peer group in order to:
A.   eliminate different financial risks.
B.   eliminate competitive factors. C.   eliminate judgment factors. D.   eliminate different business risks.
75) Which of the following best represents operating income?
A.   Income from discontinued operations
B.   Earnings before interest and taxes C.   Income from capital gains D.   Income after financing activities
76) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A.   is even less predictable. B.   leans basically toward economy, quality, and dependability.
C.   is always emotional. D.   is strictly economic and not at all emotional. E.   is always based on competitive bids from multiple suppliers.
           
77) The basic objective of the U.S. market-directed economic system is to:
A.   achieve an annual growth rate of at least 10 percent. B.   provide each person with an equal share of the economic output.
C.   make the most efficient use of the country's resources. D.   minimize inflation. E.   satisfy consumer needs as they--the consumers--see them.
78) Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:
A.   GDP measures show people's tendency to buy particular products. B.   income tends to be evenly distributed among consumers in most countries. C.   GDP estimates may not be very accurate for very different cultures and economies.
D.   Other countries most likely don’t use the US Dollar as their primary currency.
E.   GDP measures show the degree of competition in a market.
79) A firm's "marketing mix" decision areas would NOT include:
A.   Promotion.
B.   People. C.   Price. D.   Place. E.   Product.
80) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A.   Brand familiarity B.   Positioning
C.   Market scanning D.   Customer relationship management (CRM)
E.   Market segmentation
81) The "four Ps" of a marketing mix are:
A.   Production, Personnel, Price, and Physical Distribution
B.   Promotion, Production, Price, and People C.   Potential customers, Product, Price, and Personal Selling
D.   Product, Price, Promotion, and Profit E.   Product, Place, Promotion, and Price
82) When evaluating macro-marketing:
A.   the evaluation is necessarily subjective. B.   the best approach is to consider the profit generated by individual firms within the overall system.
C.   one must determine how efficiently the society's resources are used. D.   one must consider the society’s role in the marketing system. E.   one must consider each individual firm's role in the marketing system.