MGMT 2150 EXAM REVIEW | QUESTIONS AND
CORRECT ANSWERS
What are the four benefits of studying business? - answers - 1. Help choose a career
2. Improving your career
3. Help become a better-informed consumer and investor
4. Helps become a more influential community member
How does studying business help choose a career (4 benefits of studying business) -
answers - evaluating different industries, sizes, and types of employers
How does studying business help improve your career (4 benefits of studying business)
- answers - - helping develop management, interpersonal, analytical, technical, and
conceptual skills
- learning about business best practices that can make you more valuable
How does studying business help you become a better informed consumer and investor
(4 benefits of studying business) - answers - - understanding how products are created
and marketed
- evaluating purchasing decisions
- making better financial decisions using financial management and investment
knowledge
How does studying business help you become a more influential community member (4
benefits of studying business) - answers - directing purchasing power and social
influence toward businesses that align with your values
What role do businesses play in the economy? - answers - - creating jobs
- employing people
- producing goods and services to sell to customers, other businesses, and government
entities
What resources must businesses organize and combine to be successful? (4) - answers
- 1. Material resources
2. Human resources
3. Financial resources
4. Informational resources
What are material resources? - answers - the raw materials used in manufacturing as
well as in buildings and machinery
What are human resources? - answers - the people who provide their labour to a
business in terms for wages
,What are financial resources? - answers - the money required to pay employees,
purchase materials, and generally keep the business operating
What are informational resources? - answers - tells the manager of the business how
effectively the other three resources are being combined and used
What benefits do businesses bring to society? (3) - answers - 1. Offers valuable goods
and services
2. Provides employment
3. Improves quality of life
How can businesses have negative impacts on society? (3) - answers - 1. Health and
safety risks
2. Environmental damage
3. Social disruption
How do businesses have health and safety risks? (concerns of businesses on society) -
answers - - working in production environments
- use of potentially unsafe materials in manufacturing
- unsafe product design
How can businesses cause environmental damage? (concerns of business on society) -
answers - - consumption of natural resources
- using non-sustainable resources, damaging the land, air and water
- health impacts on citizens in manufacturing communities
How can businesses cause social disruption? (concerns of businesses on society) -
answers - - increasing employment in a community increases traffic, crowds schools,
changes culture etc.
- low pay and limited benefits to employees
- failure of a business spikes unemployment rates
What five factors is the business environment made up of? - answers - 1. Economic
factors
2. Competitive factors
3. Global factors
4. Technology factors (changes to production, distribution and communication)
5. Social factors (changes to demographics in the population)
What are the four types of economic systems? - answers - 1. Capitalist
2. Mixed economy
3. Socialist economy
4. Communist economy
What does capitalism argue? - answers - societies interests are best served when the
individuals within it are allowed to pursue their own self-interest
,What type of economy does canada have? - answers - mixed economy
What two economic systems are examples of a command economy? - answers - 1.
Socialism
2. Communism
How are economies classified? - answers - by their level of private ownership and
government involvement
What types of economies are most common around the world? - answers - 1. Socialism
2. Mixed economy
Why does the degree of competition matter for businesses? - answers - it affects the
number of choices available and the prices consumers pay for goods and services
What are the four degrees of competition? - answers - 1. Perfect competition
2. Monopolist competition
3. Oligopoly
4. Monopoly
What is the law of demand - answers - - the price/quantity relationship from a buyer's
perspective
- lower prices raise the incentive to buy, and increase quantity demand
- downward slope
What is the law of supply - answers - - the price/quantity relationship from a seller's
perspective
- as prices increase, there is an incentive to increase the quantity
- upward slope
What is the key strategy for sellers in monopolistic competition? - answers - product
differentiation
What industries are examples of oligopoly? - answers - airline companies and car
rentals
What strategy do companies use in an oligopoly - answers - game theory
What are examples of a monopoly competition? - answers - gas, water, electric utilities
What are indicators of economic conditions? - answers - - the business cycle
- gdp
- unemployment
- inflation
, What is the business cycle? - answers - the fluctuations in the economic growth of a
country
- expansion: when the economy is growing
- contraction: when the economy is shrinking
What is considered a stable rate of inflation? - answers - 2%
What are the three categories of ethical issues businesses can face? - answers - 1.
Competing fairly and honestly
2. Avoiding conflicts of interest
3. Being transparent
What does it mean to compete fairly and honestly (category of ethical issues in
business) - answers - - obey all laws and regulations
- refrain from knowingly deceiving, misrepresenting or intimidating others
What does it mean to avoid conflicts of interest (category of ethical issues in business) -
answers - - avoid gifts and payments when making business deals (if it influences their
decision, it is a bribe, which is illegal)
- being careful with work relationships (taking credit for others work, not meeting
commitments, pressuring others to act unethically)
What does it mean to be transparent (category of ethical issues in business) - answers -
- make information publicly available
- false or misleading ads are illegal and unethical
What are three factors that affect the level of ethical behaviour in an organization? -
answers - 1. Individual factors
2. Social factors
3. Opportunities
What are individual factors that affect ethics (three levels of ethical behaviour in
organizations) - answers - - knowledge of an issue
- personal values/goals
- ex. Sharing sensitive information due to a lack of understanding of confidentiality
requirements
What are social factors that affect ethics (three levels of ethical behaviour in
organizations) - answers - - the law
- cultural norms
- ex. Visitor from another country bribes a government official as it is a normal practice
in their home country
What are opportunities that affect ethics (three levels of ethical behaviour in
organizations) - answers - - competition environment
- level of supervision
CORRECT ANSWERS
What are the four benefits of studying business? - answers - 1. Help choose a career
2. Improving your career
3. Help become a better-informed consumer and investor
4. Helps become a more influential community member
How does studying business help choose a career (4 benefits of studying business) -
answers - evaluating different industries, sizes, and types of employers
How does studying business help improve your career (4 benefits of studying business)
- answers - - helping develop management, interpersonal, analytical, technical, and
conceptual skills
- learning about business best practices that can make you more valuable
How does studying business help you become a better informed consumer and investor
(4 benefits of studying business) - answers - - understanding how products are created
and marketed
- evaluating purchasing decisions
- making better financial decisions using financial management and investment
knowledge
How does studying business help you become a more influential community member (4
benefits of studying business) - answers - directing purchasing power and social
influence toward businesses that align with your values
What role do businesses play in the economy? - answers - - creating jobs
- employing people
- producing goods and services to sell to customers, other businesses, and government
entities
What resources must businesses organize and combine to be successful? (4) - answers
- 1. Material resources
2. Human resources
3. Financial resources
4. Informational resources
What are material resources? - answers - the raw materials used in manufacturing as
well as in buildings and machinery
What are human resources? - answers - the people who provide their labour to a
business in terms for wages
,What are financial resources? - answers - the money required to pay employees,
purchase materials, and generally keep the business operating
What are informational resources? - answers - tells the manager of the business how
effectively the other three resources are being combined and used
What benefits do businesses bring to society? (3) - answers - 1. Offers valuable goods
and services
2. Provides employment
3. Improves quality of life
How can businesses have negative impacts on society? (3) - answers - 1. Health and
safety risks
2. Environmental damage
3. Social disruption
How do businesses have health and safety risks? (concerns of businesses on society) -
answers - - working in production environments
- use of potentially unsafe materials in manufacturing
- unsafe product design
How can businesses cause environmental damage? (concerns of business on society) -
answers - - consumption of natural resources
- using non-sustainable resources, damaging the land, air and water
- health impacts on citizens in manufacturing communities
How can businesses cause social disruption? (concerns of businesses on society) -
answers - - increasing employment in a community increases traffic, crowds schools,
changes culture etc.
- low pay and limited benefits to employees
- failure of a business spikes unemployment rates
What five factors is the business environment made up of? - answers - 1. Economic
factors
2. Competitive factors
3. Global factors
4. Technology factors (changes to production, distribution and communication)
5. Social factors (changes to demographics in the population)
What are the four types of economic systems? - answers - 1. Capitalist
2. Mixed economy
3. Socialist economy
4. Communist economy
What does capitalism argue? - answers - societies interests are best served when the
individuals within it are allowed to pursue their own self-interest
,What type of economy does canada have? - answers - mixed economy
What two economic systems are examples of a command economy? - answers - 1.
Socialism
2. Communism
How are economies classified? - answers - by their level of private ownership and
government involvement
What types of economies are most common around the world? - answers - 1. Socialism
2. Mixed economy
Why does the degree of competition matter for businesses? - answers - it affects the
number of choices available and the prices consumers pay for goods and services
What are the four degrees of competition? - answers - 1. Perfect competition
2. Monopolist competition
3. Oligopoly
4. Monopoly
What is the law of demand - answers - - the price/quantity relationship from a buyer's
perspective
- lower prices raise the incentive to buy, and increase quantity demand
- downward slope
What is the law of supply - answers - - the price/quantity relationship from a seller's
perspective
- as prices increase, there is an incentive to increase the quantity
- upward slope
What is the key strategy for sellers in monopolistic competition? - answers - product
differentiation
What industries are examples of oligopoly? - answers - airline companies and car
rentals
What strategy do companies use in an oligopoly - answers - game theory
What are examples of a monopoly competition? - answers - gas, water, electric utilities
What are indicators of economic conditions? - answers - - the business cycle
- gdp
- unemployment
- inflation
, What is the business cycle? - answers - the fluctuations in the economic growth of a
country
- expansion: when the economy is growing
- contraction: when the economy is shrinking
What is considered a stable rate of inflation? - answers - 2%
What are the three categories of ethical issues businesses can face? - answers - 1.
Competing fairly and honestly
2. Avoiding conflicts of interest
3. Being transparent
What does it mean to compete fairly and honestly (category of ethical issues in
business) - answers - - obey all laws and regulations
- refrain from knowingly deceiving, misrepresenting or intimidating others
What does it mean to avoid conflicts of interest (category of ethical issues in business) -
answers - - avoid gifts and payments when making business deals (if it influences their
decision, it is a bribe, which is illegal)
- being careful with work relationships (taking credit for others work, not meeting
commitments, pressuring others to act unethically)
What does it mean to be transparent (category of ethical issues in business) - answers -
- make information publicly available
- false or misleading ads are illegal and unethical
What are three factors that affect the level of ethical behaviour in an organization? -
answers - 1. Individual factors
2. Social factors
3. Opportunities
What are individual factors that affect ethics (three levels of ethical behaviour in
organizations) - answers - - knowledge of an issue
- personal values/goals
- ex. Sharing sensitive information due to a lack of understanding of confidentiality
requirements
What are social factors that affect ethics (three levels of ethical behaviour in
organizations) - answers - - the law
- cultural norms
- ex. Visitor from another country bribes a government official as it is a normal practice
in their home country
What are opportunities that affect ethics (three levels of ethical behaviour in
organizations) - answers - - competition environment
- level of supervision
