, Question 1
A mid-sized firm is experiencing high employee turnover despite competitive
salaries. Exit interviews reveal that employees feel their work lacks meaning
and autonomy. Which management approach would most effectively address
these issues?
A. Scientific management, focusing on time and motion studies to
improve efficiency.
B. Job enrichment, increasing responsibility and decision-making
authority.
C. Bureaucratic control, implementing stricter rules and close
supervision.
D. Human relations approach, emphasizing social relationships and
informal groups.
Correct Answer: B - Job enrichment, increasing responsibility
and decision-making authority.
RATIONALE
Job enrichment directly addresses lack of meaning and autonomy by
enhancing responsibility and decision-making. Scientific management
and bureaucratic control would likely worsen the issues by reducing
autonomy, while the human relations approach focuses on social needs
rather than task-related empowerment.
Question 2
A company's current ratio is 2.5, quick ratio is 0.8, and inventory turnover is 4
times. What does this pattern most likely indicate?
A. The company has excessive inventory and poor liquidity.
B. The company is highly liquid and efficiently managing inventory.
C. The company has strong short-term liquidity but may have
slow-moving inventory.
D. The company is at risk of bankruptcy due to low quick ratio.
Page 2
,Correct Answer: C - The company has strong short-term liquidity
but may have slow-moving inventory.
RATIONALE
A high current ratio (2.5) suggests good short-term liquidity, but a low
quick ratio (0.8) indicates that inventory constitutes a large portion of
current assets. The moderate inventory turnover (4) suggests inventory
may be slow-moving, tying up cash. Thus, the pattern indicates
liquidity is tied up in inventory.
Question 3
A startup segments its market based on consumers' attitudes toward
environmental sustainability. Which segmentation base is being used?
A. Demographic
B. Geographic
C. Psychographic
D. Behavioral
Correct Answer: C - Psychographic
RATIONALE
Psychographic segmentation divides consumers by attitudes, values,
and lifestyles. Attitudes toward sustainability are psychographic.
Demographic focuses on age, income, etc.; geographic on location;
behavioral on usage or loyalty.
Question 4
Under the Foreign Corrupt Practices Act (FCPA), which action is most likely
permissible for a U.S. company operating abroad?
A. Providing a small facilitation payment to expedite a routine
government permit.
B. Offering a lavish gift to a foreign official to secure a contract.
C. Making a payment to a foreign political party to influence legislation.
Page 3
, D. Bribing a customs officer to overlook a minor regulation.
Correct Answer: A - Providing a small facilitation payment to
expedite a routine government permit.
RATIONALE
The FCPA permits facilitation payments for routine governmental
actions, such as expediting permits. Lavish gifts, payments to
influence legislation, and bribing officials for regulatory relief are
prohibited. This exception is narrow and does not cover obtaining
business.
Question 5
A production manager uses a just-in-time (JIT) inventory system. A sudden
supplier strike halts deliveries. What is the most immediate operational
consequence?
A. Increased inventory holding costs.
B. Production stoppage due to lack of raw materials.
C. Higher defect rates in finished goods.
D. Decreased employee morale.
Correct Answer: B - Production stoppage due to lack of raw
materials.
RATIONALE
JIT minimizes inventory, so any supply disruption quickly leads to
material shortages and production halts. Holding costs would
decrease, not increase; defect rates and morale are less direct and
immediate impacts.
Question 6
Which of the following best exemplifies a company using a differentiation
strategy?
A. A retailer offering the lowest prices in the market.
Page 4
A mid-sized firm is experiencing high employee turnover despite competitive
salaries. Exit interviews reveal that employees feel their work lacks meaning
and autonomy. Which management approach would most effectively address
these issues?
A. Scientific management, focusing on time and motion studies to
improve efficiency.
B. Job enrichment, increasing responsibility and decision-making
authority.
C. Bureaucratic control, implementing stricter rules and close
supervision.
D. Human relations approach, emphasizing social relationships and
informal groups.
Correct Answer: B - Job enrichment, increasing responsibility
and decision-making authority.
RATIONALE
Job enrichment directly addresses lack of meaning and autonomy by
enhancing responsibility and decision-making. Scientific management
and bureaucratic control would likely worsen the issues by reducing
autonomy, while the human relations approach focuses on social needs
rather than task-related empowerment.
Question 2
A company's current ratio is 2.5, quick ratio is 0.8, and inventory turnover is 4
times. What does this pattern most likely indicate?
A. The company has excessive inventory and poor liquidity.
B. The company is highly liquid and efficiently managing inventory.
C. The company has strong short-term liquidity but may have
slow-moving inventory.
D. The company is at risk of bankruptcy due to low quick ratio.
Page 2
,Correct Answer: C - The company has strong short-term liquidity
but may have slow-moving inventory.
RATIONALE
A high current ratio (2.5) suggests good short-term liquidity, but a low
quick ratio (0.8) indicates that inventory constitutes a large portion of
current assets. The moderate inventory turnover (4) suggests inventory
may be slow-moving, tying up cash. Thus, the pattern indicates
liquidity is tied up in inventory.
Question 3
A startup segments its market based on consumers' attitudes toward
environmental sustainability. Which segmentation base is being used?
A. Demographic
B. Geographic
C. Psychographic
D. Behavioral
Correct Answer: C - Psychographic
RATIONALE
Psychographic segmentation divides consumers by attitudes, values,
and lifestyles. Attitudes toward sustainability are psychographic.
Demographic focuses on age, income, etc.; geographic on location;
behavioral on usage or loyalty.
Question 4
Under the Foreign Corrupt Practices Act (FCPA), which action is most likely
permissible for a U.S. company operating abroad?
A. Providing a small facilitation payment to expedite a routine
government permit.
B. Offering a lavish gift to a foreign official to secure a contract.
C. Making a payment to a foreign political party to influence legislation.
Page 3
, D. Bribing a customs officer to overlook a minor regulation.
Correct Answer: A - Providing a small facilitation payment to
expedite a routine government permit.
RATIONALE
The FCPA permits facilitation payments for routine governmental
actions, such as expediting permits. Lavish gifts, payments to
influence legislation, and bribing officials for regulatory relief are
prohibited. This exception is narrow and does not cover obtaining
business.
Question 5
A production manager uses a just-in-time (JIT) inventory system. A sudden
supplier strike halts deliveries. What is the most immediate operational
consequence?
A. Increased inventory holding costs.
B. Production stoppage due to lack of raw materials.
C. Higher defect rates in finished goods.
D. Decreased employee morale.
Correct Answer: B - Production stoppage due to lack of raw
materials.
RATIONALE
JIT minimizes inventory, so any supply disruption quickly leads to
material shortages and production halts. Holding costs would
decrease, not increase; defect rates and morale are less direct and
immediate impacts.
Question 6
Which of the following best exemplifies a company using a differentiation
strategy?
A. A retailer offering the lowest prices in the market.
Page 4
