BUSA 2106 EXAM 2 QUESTIONS WITH VERIFIED
ANSWERS
In the U.S., the major actions that society delegates to government is to
______________. - Answers - provide laws that are logically deduced from the U.S.
Constitution and the Bill of Rights and to enforce these laws through the judicial system.
Because no government system is perfect ______________. - Answers - legal and
regulatory systems are constantly evolving and changing in response to social
institutions, including business
What is the definition of regulation? - Answers - The act of creating and enforcing rules
for a specific purpose
______________ results when just one business provides a good or service in a
particular market. - Answers - Monopoly
Which of the following is least likely to be considered destructive or unfair competition? -
Answers - Obtaining information through careful monitoring of the competitive
environment
Utility companies that supply electricity, natural gas, water, or cable television are
examples today of _______________. - Answers - monopolies
_______________ are expenditures by organizations to meet regulatory requirements,
such as reporting activities. - Answers - Compliance costs
_______________ are expenditures by government to develop and administer
regulatory requirements, including the salaries of government workers, hiring
inspectors, purchasing office supplies, and other overhead expenses. - Answers -
Administration and enforcement costs
To generate a measurement of the costs of regulation, economists generally classify
regulations as _______________. - Answers - Economic or social
How could regulation on businesses result in a "hidden tax" to customers? - Answers -
Businesses often pass regulatory costs on to their customers in the form of higher
prices
Which of the following is a benefit of regulation? - Answers - Safer products
, Which of these statements best describes the Better Business Bureau (BBB)? -
Answers - The BBB is a self-regulatory association that helps resolve problems
between businesses and consumers.
Nonprofit, citizen-based groups that functions independent of government are called
_________. - Answers - Nongovernmental organizations(NGOs)
Self-regulation is an effort to _______________. - Answers - demonstrate legal
compliance and social responsibility to stakeholders and preclude further governmental
regulation
Which of the follow describes patent laws? - Answers - Laws that grant the developer a
period of time (usually 20 years) during which no other firm can use the same
technology without the patent holder's consent.
A ____________ is an industry group that creates a set of rules and enforces industry
standards as part of their self-regulatory programs. - Answers - Trade association
Which of the following best describes how managers should work within the regulatory
environment? - Answers - Top managers must take responsibility and be accountable
for assessing legal risks and developing corporate programs that promote and reward
acceptable conduct.
_______________ creates a strong economy and protects competition to provide
opportunity for organizations and individuals to be financially successful. - Answers -
Economic regulation
The _______________ attempted to improve conditions during the Great Recession
(2009-13) by obtaining ownership of stocks and assets of banks and financial
companies that were devastated by the financial crisis. - Answers - Troubled Asset
Relief Program (TARP)
Which of the following is a responsibility of the Public Accounting Oversight Board
(PCAOB)? - Answers - provides oversight audits of public companies
A self-regulatory resource that assists its business members in becoming more efficient
and up to date in marketing by relying on accurate consumer data and adjusting to new
technology. - Answers - Data and Marketing Association (DMA)
Regarding capitalism during the Great Depression (1929-1945), for what did John
Maynard Keynes argue? - Answers - that there should be more government policies to
stimulate economic growth
Adam Smith's idea of _______________ was critical to capitalism because it assumes
that the market through its own inherent mechanisms will keep commerce (supply and
demand) in equilibrium (balance). - Answers - the "invisible hand" of the market
ANSWERS
In the U.S., the major actions that society delegates to government is to
______________. - Answers - provide laws that are logically deduced from the U.S.
Constitution and the Bill of Rights and to enforce these laws through the judicial system.
Because no government system is perfect ______________. - Answers - legal and
regulatory systems are constantly evolving and changing in response to social
institutions, including business
What is the definition of regulation? - Answers - The act of creating and enforcing rules
for a specific purpose
______________ results when just one business provides a good or service in a
particular market. - Answers - Monopoly
Which of the following is least likely to be considered destructive or unfair competition? -
Answers - Obtaining information through careful monitoring of the competitive
environment
Utility companies that supply electricity, natural gas, water, or cable television are
examples today of _______________. - Answers - monopolies
_______________ are expenditures by organizations to meet regulatory requirements,
such as reporting activities. - Answers - Compliance costs
_______________ are expenditures by government to develop and administer
regulatory requirements, including the salaries of government workers, hiring
inspectors, purchasing office supplies, and other overhead expenses. - Answers -
Administration and enforcement costs
To generate a measurement of the costs of regulation, economists generally classify
regulations as _______________. - Answers - Economic or social
How could regulation on businesses result in a "hidden tax" to customers? - Answers -
Businesses often pass regulatory costs on to their customers in the form of higher
prices
Which of the following is a benefit of regulation? - Answers - Safer products
, Which of these statements best describes the Better Business Bureau (BBB)? -
Answers - The BBB is a self-regulatory association that helps resolve problems
between businesses and consumers.
Nonprofit, citizen-based groups that functions independent of government are called
_________. - Answers - Nongovernmental organizations(NGOs)
Self-regulation is an effort to _______________. - Answers - demonstrate legal
compliance and social responsibility to stakeholders and preclude further governmental
regulation
Which of the follow describes patent laws? - Answers - Laws that grant the developer a
period of time (usually 20 years) during which no other firm can use the same
technology without the patent holder's consent.
A ____________ is an industry group that creates a set of rules and enforces industry
standards as part of their self-regulatory programs. - Answers - Trade association
Which of the following best describes how managers should work within the regulatory
environment? - Answers - Top managers must take responsibility and be accountable
for assessing legal risks and developing corporate programs that promote and reward
acceptable conduct.
_______________ creates a strong economy and protects competition to provide
opportunity for organizations and individuals to be financially successful. - Answers -
Economic regulation
The _______________ attempted to improve conditions during the Great Recession
(2009-13) by obtaining ownership of stocks and assets of banks and financial
companies that were devastated by the financial crisis. - Answers - Troubled Asset
Relief Program (TARP)
Which of the following is a responsibility of the Public Accounting Oversight Board
(PCAOB)? - Answers - provides oversight audits of public companies
A self-regulatory resource that assists its business members in becoming more efficient
and up to date in marketing by relying on accurate consumer data and adjusting to new
technology. - Answers - Data and Marketing Association (DMA)
Regarding capitalism during the Great Depression (1929-1945), for what did John
Maynard Keynes argue? - Answers - that there should be more government policies to
stimulate economic growth
Adam Smith's idea of _______________ was critical to capitalism because it assumes
that the market through its own inherent mechanisms will keep commerce (supply and
demand) in equilibrium (balance). - Answers - the "invisible hand" of the market
