Glo-bus Quiz 2 Questions and Complete
Solutions Graded A+
Which one of the following is NOT a way to improve the P/Q rating of a company's brand of multi-
featured cameras - Answer: Increasing the number of models in the company's line of multi-featured
cameras.
Assume a company's Income Statement for a given quarter is as follows: Sales Revenues (50,000),
Production Costs (26,500), Delivery Costs (1,600), Marketing Costs (8,500), Administrative Expenses
(2,000), Operating Profit (14,400), Net Interest (750), Income Before Taxes (13,650), Taxes (4,095), Net
Income (9,555). Based on the above data, which of the following statements is false? - Answer: Delivery
costs are 2.8% of revenues and represent the company's smallest cost component.
One of the benefits of pursuing a strategy of social responsibility and corporate citizenship is - Answer:
An enhanced image rating, provided company spending for socially responsible activities is meaningful
and is sustained over a multi-year period.
Which of the following is NOT an action company co-managers can take to boost a subpar ROE? -
Answer: Issue additional shares of stock and use the proceeds to pay down the debt outstanding on the
company's line of credit.
Which one of the following actions is usually a dependable and appealing way for managers to try to
boost their company's EPS? - Answer: Achieve a differentiation-based competitive advantage over rivals
in both the entry-level and multi-featured camera segments that company managers are savvy enough
to sustain; as the market demand for digital cameras grows worldwide and the company exploits its
competitive advantage to win additional sales, the profit margins from a growing sales volume of entry-
level and multi-featured digital cameras typically results in increase in EPS.
The industry-low, industry-average, and industry-high benchmarks for camera costs and operating
profits on pp. 5-6 of each issue of the GLO-BUS Statistical Review. - Answer: Are worth careful scrutiny
by the managers of all companies because when the benchmarking data signals that a company's
costs/operating profits for one or more of the benchmarks are clearly out-of-line (or unappealing),
managers are well advised to take corrective action in the next decision round.
Solutions Graded A+
Which one of the following is NOT a way to improve the P/Q rating of a company's brand of multi-
featured cameras - Answer: Increasing the number of models in the company's line of multi-featured
cameras.
Assume a company's Income Statement for a given quarter is as follows: Sales Revenues (50,000),
Production Costs (26,500), Delivery Costs (1,600), Marketing Costs (8,500), Administrative Expenses
(2,000), Operating Profit (14,400), Net Interest (750), Income Before Taxes (13,650), Taxes (4,095), Net
Income (9,555). Based on the above data, which of the following statements is false? - Answer: Delivery
costs are 2.8% of revenues and represent the company's smallest cost component.
One of the benefits of pursuing a strategy of social responsibility and corporate citizenship is - Answer:
An enhanced image rating, provided company spending for socially responsible activities is meaningful
and is sustained over a multi-year period.
Which of the following is NOT an action company co-managers can take to boost a subpar ROE? -
Answer: Issue additional shares of stock and use the proceeds to pay down the debt outstanding on the
company's line of credit.
Which one of the following actions is usually a dependable and appealing way for managers to try to
boost their company's EPS? - Answer: Achieve a differentiation-based competitive advantage over rivals
in both the entry-level and multi-featured camera segments that company managers are savvy enough
to sustain; as the market demand for digital cameras grows worldwide and the company exploits its
competitive advantage to win additional sales, the profit margins from a growing sales volume of entry-
level and multi-featured digital cameras typically results in increase in EPS.
The industry-low, industry-average, and industry-high benchmarks for camera costs and operating
profits on pp. 5-6 of each issue of the GLO-BUS Statistical Review. - Answer: Are worth careful scrutiny
by the managers of all companies because when the benchmarking data signals that a company's
costs/operating profits for one or more of the benchmarks are clearly out-of-line (or unappealing),
managers are well advised to take corrective action in the next decision round.
