PBAM Final Exam Review Part One

Shortly after President Barack Obama first took office, a number of new regulations were imposed on businesses. Among other things, he signed legislation that imposed new restrictions on lobbying and on political action committees. Which dimension of the external environment BEST encompasses the factors affecting government regulation of business?

• Political-legal environment

• Economic environment

• Global business environment

• Technological environment

Which additional factor of production do economists now include, in addition to the traditional factors of labor, capital, entrepreneurs, and physical resources?

• National

• Externalities

• Political

• Informational resources

Which of the following is the BEST description of the law of demand?

• The quantity demanded decreases as the price decreases.

• The quantity demanded increases as the price decreases.

• Demand is unrelated to fluctuations in supply.

• Supply decreases as the demand increases.

As the price of textbooks has increased, more and more students are renting textbooks, buying used textbooks online, or using the electronic version of the required course materials. The law of demand and supply suggests that the book sellers will raise prices to the point where supply and demand come into balance. What happens if the price of textbooks goes above this equilibrium point?

• The quantity demanded will increase

• There will be a shortage of textbooks.

• There will be a surplus of textbooks.

• Book sellers will see increased profits

Rolex Watches have lost some of their exclusiveness, and Rolex has been losing U.S. market share to BVLGARI and Tag Heuer. Based on this information, which degree of competition would BEST describe the luxury watch market in the United States?

• Oligopolu

• Monopoly

• Monopolistic

• Perfect competition

Which of the following BEST describes a conflict of interest?

• Parties engaging in an activity that does not equally benefit all parties

• An employee engaging in an activity that may benefit that individual to the detriment of his or her employer

• A company engaging in practices that conflict with government regulations

• People on different sides of an issue agreeing to disagree

A manager who is examining an action or policy based on the ethical norm of utility would likely ask which of the following questions?

• Is the action or policy consistent with people's responsibilities to each other?

• Which individuals or groups will be affected by this action or policy?

• Is the action or policy consistent with what is considered fair or equitable?

• Does the action or policy optimize the benefits to those who are affected by it

Which of the following is deemed as the single MOST effective step an organization can take to encourage ethical behavior in the workplace?

• Establish strict punishment for ethics violations.

• Monitor employee behavior to ensure adherence to established rules and procedures.

• Demonstrate top management support of ethical standards.

• Require attendance at ethics training programs on an annual basis.

Which of the following questions would a manager ask if s/he were examining an action or policy based upon the ethical norm of justice?

• Is this action consistent with people's responsibilities to each another?

• Does the action or policy respect the rights of all affected individuals or groups?

• Is this action consistent with what is generally considered to be "fair"?

• Which individuals or groups will be affected by this action or policy?

Which of the following is an advantage of a sole proprietorship?

• Ease of formation

• Business continuity

• Unlimited liability

• Ability to grow by adding new talent