BUSINESS EDUCATION PRAXIS II 5101
EXAM | PRACTICE QUESTIONS AND
DETAILED ANSWERS | GRADED A+ |
GUARANTEED SUCCESS
Updated 2026 Questions and Answers | 100% Verified
Exam Prep
,Functional Management Structure Divides the parts of the business by what they do. Production, Acctg, marketing, etc.
Territorial structure operations are spread out over a variety of areas each operating independently
Product structure break along product lines(auto manufacturer)
Matrix structure functional and product structures - both financial and production oversee a project
Management style-Exploitative/Authorative managerial decisions are imposed on subordinates and management has greater
responsibility; little communication overall on the hierarchy; Employees very dependent
on jobs and exploited by management. Ex: bad factories. Ineffective
Management style-Exploitative/benevoloent managerial assumption that management acts in the best interest of the workers; little
communication overall on the hierarchy; Management patronizing and fail to take into
account employees feelings. Ineffective
Consultative style small degree of trust in employees by management; all employees feel some
responsibility for the overall success of the company, there is some degree of teamwork
and freedom to act on minor issues among employees. But management handles larger
issues and does not trust lower level employees with important manners.
Participative-group style most effective. Managers have trust in subordinates b/c every employee is well trained
and competent. Motivation by reward not punishment.
Sole proprietorship owned and operated by one person. Suffer from limited sources of capital, high risk. Do
not have to pay income taxes on profits, only personal income.
Corporations distance and viable entity. Ownership of a corporation is held by individuals who own
shares of corporation's stock. Individual shareholders are not responsible for the actions
of the corporation-just lose initial investment. Employees cannot be prosecuted for the
acts of the corporation at large. Attract solid managers, manipulate/influences govt
policy to suit their ends.
Corporate governance Stockholders elect the members of a board of directors who oversee the operations of
the corporation. Real power held by management group not stockholders who
cooperate with a few major stockholders to ensure they remain in power.
,Proxies permission given by stockholders to someone else to manage the stockholder's interest
in the corporation.
Advantages of Corporations ownership of corporations is easily transferable and it rarely has any effect on the daily
operations of the business.
Disadvantages of corporations double taxation-company taxed as legal entity and shareholders must pay income taxes
on dividends.
Partnerships business owned and operated by two or more principals for the purpose of making a
profit. Jointly provide capital and labor in exchange for shared profit or loss. No govt
permission is required for a partnership, business affairs do not have to be shared
beyond partners., as a business form is not required to pay income taxes. Disadvantages:
unstable, hard to dissolve if one partner is found to be incompetent.
Cooperative small group of individuals or smaller groups that join together to achieve some common
goals. Ex: credit unions, retail consumer groups, residential organizations, and marketing
associations.
Board of directors selects upper level management including the CEO and supervises strategy and financial
objectives.
Business planning assess the business' current status, anticipate trends in the market and consider the
financial implications of proposed plans. Planning is impossible without good records
from the acctg department.
Steps to Business planning 1. Becoming aware of an opportunity or problem. 2. Define a clear and verifiable
objective. 3. Develop the premises of their future plans - forecasting changes in market,
assessing population growth and changes in price level. 4. Consider the various means of
getting the job done, weigh alternatives. 5. Selecting a course of action. 6.Develop the
supporting plans for the great plan to be completed.
Business Objectives goals or end points to where the business is aiming.
Business Policies statements of purpose that will define the way a business goes about achieving its goals.
A successful set of policies set limits to business activity and encourage initiative.
, Business strategies Overall plans that take into consideration such external factors as trends in the
marketplace or actions of the competitors. Course of action.
Business procedures must be clear and specify exactly how future actions should be performed.
Business rules and programs things that employees are either required to do or are forbidden from doing.
Fiscal policy created and implemented by the federal government in the hopes of increasing the gross
national product, raising employment and stabilizing price and money.
Expansionary fiscal policy combats a recession by either lowering taxes or increasing government spending
Contractionary fiscal policy aims to fight inflation and involves raising taxes and decreasing spending.
Monetary policy actions of a bank or currency regulation organization that affects the size of the money
supply and therefore interest rates. Designed to restrain inflation, improve the
employment rate and stabilize the economy.
3 ways the Fed carries out monetary policy Open market operations, discount rate, reserve requirements. To halt a recession -
expands the money supply, decrease inflation - limit spending by contracting the money
supply.
Open Market operations government purchasing and selling of government securities (bonds) to affect the size of
the money supply (to increase, buys securities)
Discount rate rate of interest charged to member banks for loans.
Federal reserve centralized national bank, established by the National Monetary Commission in 1908 via
the Federal Reserve Act in 1913, bank of private banks. Consists of the Board of
Governors, Fed Open Market Committee, 12 Federal Reserve banks and the various
banks and advisory committees.
Board of Governors 7 members appointed by the President, confirmed by the senate and serve 14 years.
Typically economists. Create and implement monetary policy, decides on amount of
money to loan member banks and to set the rate of interest on loans, over sees bank
mergers and acquisitions of American banks and any international member banks.
Reports to congress.
EXAM | PRACTICE QUESTIONS AND
DETAILED ANSWERS | GRADED A+ |
GUARANTEED SUCCESS
Updated 2026 Questions and Answers | 100% Verified
Exam Prep
,Functional Management Structure Divides the parts of the business by what they do. Production, Acctg, marketing, etc.
Territorial structure operations are spread out over a variety of areas each operating independently
Product structure break along product lines(auto manufacturer)
Matrix structure functional and product structures - both financial and production oversee a project
Management style-Exploitative/Authorative managerial decisions are imposed on subordinates and management has greater
responsibility; little communication overall on the hierarchy; Employees very dependent
on jobs and exploited by management. Ex: bad factories. Ineffective
Management style-Exploitative/benevoloent managerial assumption that management acts in the best interest of the workers; little
communication overall on the hierarchy; Management patronizing and fail to take into
account employees feelings. Ineffective
Consultative style small degree of trust in employees by management; all employees feel some
responsibility for the overall success of the company, there is some degree of teamwork
and freedom to act on minor issues among employees. But management handles larger
issues and does not trust lower level employees with important manners.
Participative-group style most effective. Managers have trust in subordinates b/c every employee is well trained
and competent. Motivation by reward not punishment.
Sole proprietorship owned and operated by one person. Suffer from limited sources of capital, high risk. Do
not have to pay income taxes on profits, only personal income.
Corporations distance and viable entity. Ownership of a corporation is held by individuals who own
shares of corporation's stock. Individual shareholders are not responsible for the actions
of the corporation-just lose initial investment. Employees cannot be prosecuted for the
acts of the corporation at large. Attract solid managers, manipulate/influences govt
policy to suit their ends.
Corporate governance Stockholders elect the members of a board of directors who oversee the operations of
the corporation. Real power held by management group not stockholders who
cooperate with a few major stockholders to ensure they remain in power.
,Proxies permission given by stockholders to someone else to manage the stockholder's interest
in the corporation.
Advantages of Corporations ownership of corporations is easily transferable and it rarely has any effect on the daily
operations of the business.
Disadvantages of corporations double taxation-company taxed as legal entity and shareholders must pay income taxes
on dividends.
Partnerships business owned and operated by two or more principals for the purpose of making a
profit. Jointly provide capital and labor in exchange for shared profit or loss. No govt
permission is required for a partnership, business affairs do not have to be shared
beyond partners., as a business form is not required to pay income taxes. Disadvantages:
unstable, hard to dissolve if one partner is found to be incompetent.
Cooperative small group of individuals or smaller groups that join together to achieve some common
goals. Ex: credit unions, retail consumer groups, residential organizations, and marketing
associations.
Board of directors selects upper level management including the CEO and supervises strategy and financial
objectives.
Business planning assess the business' current status, anticipate trends in the market and consider the
financial implications of proposed plans. Planning is impossible without good records
from the acctg department.
Steps to Business planning 1. Becoming aware of an opportunity or problem. 2. Define a clear and verifiable
objective. 3. Develop the premises of their future plans - forecasting changes in market,
assessing population growth and changes in price level. 4. Consider the various means of
getting the job done, weigh alternatives. 5. Selecting a course of action. 6.Develop the
supporting plans for the great plan to be completed.
Business Objectives goals or end points to where the business is aiming.
Business Policies statements of purpose that will define the way a business goes about achieving its goals.
A successful set of policies set limits to business activity and encourage initiative.
, Business strategies Overall plans that take into consideration such external factors as trends in the
marketplace or actions of the competitors. Course of action.
Business procedures must be clear and specify exactly how future actions should be performed.
Business rules and programs things that employees are either required to do or are forbidden from doing.
Fiscal policy created and implemented by the federal government in the hopes of increasing the gross
national product, raising employment and stabilizing price and money.
Expansionary fiscal policy combats a recession by either lowering taxes or increasing government spending
Contractionary fiscal policy aims to fight inflation and involves raising taxes and decreasing spending.
Monetary policy actions of a bank or currency regulation organization that affects the size of the money
supply and therefore interest rates. Designed to restrain inflation, improve the
employment rate and stabilize the economy.
3 ways the Fed carries out monetary policy Open market operations, discount rate, reserve requirements. To halt a recession -
expands the money supply, decrease inflation - limit spending by contracting the money
supply.
Open Market operations government purchasing and selling of government securities (bonds) to affect the size of
the money supply (to increase, buys securities)
Discount rate rate of interest charged to member banks for loans.
Federal reserve centralized national bank, established by the National Monetary Commission in 1908 via
the Federal Reserve Act in 1913, bank of private banks. Consists of the Board of
Governors, Fed Open Market Committee, 12 Federal Reserve banks and the various
banks and advisory committees.
Board of Governors 7 members appointed by the President, confirmed by the senate and serve 14 years.
Typically economists. Create and implement monetary policy, decides on amount of
money to loan member banks and to set the rate of interest on loans, over sees bank
mergers and acquisitions of American banks and any international member banks.
Reports to congress.
