Test bank
Chapter01, Chapter 1: The Power of Principles: A Historical Perspective
Multiple choice questions
1. Which of the following did not contribute to the high transaction related risks for U.S. potato sales in
1840?
a. Infrequency of transactions
b. Changing transaction partners
c. Lack of availability of sales and prices for comparable goods
d. Competition from European merchants
e. Geographic distance between buyers and sellers
Answer: d
Title The World in 1840 – Doing Business in 1840
Dif:: Medium
2. What was a key contribution to the dominance of the family-run small business in 1840?
a. Factories
b. Infrastructure
c. Raw Materials
d. Management
e. Laws
Answer: b
1
,Test bank
Title The World in 1840 – Conditions of Business in 1840: Life without a Modern Infrastructure
Dif:: Easy
3. Matchmakers between manufacturers and sellers are called:
a. Agents
b. Factors
c. Brokers
d. Merchants
e. None of the Above
Answer: c
Title Doing Business in 1840
Dif:: Easy
4. What significant transportation event brought about the first significant growth of the Great Lakes
region?
a. Harnessing of the steam engine
b. Invention of the screw propeller
c. Opening of the Erie Canal
d. Integration of railway system
e. Invention of the railway system
Answer: c
Title The World in 1840 – Conditions of Business in 1840: Life without a Modern Infrastructure –
Transportation
Dif:: Medium
2
,Test bank
5. What is throughput?
a. The movement of inputs and outputs through a production process
b. Assets that assist in the production or distribution of goods and services
c. A condition that determines the horizontal and vertical boundaries of business firms
d. An investment in the acquisition of raw materials
e. The amount of time for a good to travel between metropolitan areas
Answer: a
Title Example 4.1 – The Emergence of Chicago
Dif:: Hard
6. What mode of long-distance communication first laid the groundwork for today’s modern
communication forms?
a. U.S. Postal Service
b. Private mail service
c. Telegraph
d. Telephone
e. Railroad
Answer: d
Title The World in 1840 – Conditions of Business in 1840: Life without a Modern Infrastructure –
Communications
Dif:: Easy
3
, Test bank
7. What was the major role of private banks in the early 1800s?
a. Serve as an institution for deposits
b. Issue credit
c. Reduce the risk of price fluctuation
d. Create futures markets
e. Sell stocks
Answer: b
Title The World in 1840 – Conditions of Business in 1840: Life without a Modern Infrastructure –
Finance
Dif:: Medium
8. What was one of the first plant/factory types to use the “American System” of manufacturing?
a. Firearms
b. Steel
c. Oil
d. Automobiles
e. Chemicals
Answer: a
Title The World in 1840 – Conditions of Business in 1840: Life without a Modern Infrastructure –
Production Technology
Dif:: Medium
9. What economics game theory concept is demonstrated by the Erie Canal public works project?
a. Nash equilibrium
4
Chapter01, Chapter 1: The Power of Principles: A Historical Perspective
Multiple choice questions
1. Which of the following did not contribute to the high transaction related risks for U.S. potato sales in
1840?
a. Infrequency of transactions
b. Changing transaction partners
c. Lack of availability of sales and prices for comparable goods
d. Competition from European merchants
e. Geographic distance between buyers and sellers
Answer: d
Title The World in 1840 – Doing Business in 1840
Dif:: Medium
2. What was a key contribution to the dominance of the family-run small business in 1840?
a. Factories
b. Infrastructure
c. Raw Materials
d. Management
e. Laws
Answer: b
1
,Test bank
Title The World in 1840 – Conditions of Business in 1840: Life without a Modern Infrastructure
Dif:: Easy
3. Matchmakers between manufacturers and sellers are called:
a. Agents
b. Factors
c. Brokers
d. Merchants
e. None of the Above
Answer: c
Title Doing Business in 1840
Dif:: Easy
4. What significant transportation event brought about the first significant growth of the Great Lakes
region?
a. Harnessing of the steam engine
b. Invention of the screw propeller
c. Opening of the Erie Canal
d. Integration of railway system
e. Invention of the railway system
Answer: c
Title The World in 1840 – Conditions of Business in 1840: Life without a Modern Infrastructure –
Transportation
Dif:: Medium
2
,Test bank
5. What is throughput?
a. The movement of inputs and outputs through a production process
b. Assets that assist in the production or distribution of goods and services
c. A condition that determines the horizontal and vertical boundaries of business firms
d. An investment in the acquisition of raw materials
e. The amount of time for a good to travel between metropolitan areas
Answer: a
Title Example 4.1 – The Emergence of Chicago
Dif:: Hard
6. What mode of long-distance communication first laid the groundwork for today’s modern
communication forms?
a. U.S. Postal Service
b. Private mail service
c. Telegraph
d. Telephone
e. Railroad
Answer: d
Title The World in 1840 – Conditions of Business in 1840: Life without a Modern Infrastructure –
Communications
Dif:: Easy
3
, Test bank
7. What was the major role of private banks in the early 1800s?
a. Serve as an institution for deposits
b. Issue credit
c. Reduce the risk of price fluctuation
d. Create futures markets
e. Sell stocks
Answer: b
Title The World in 1840 – Conditions of Business in 1840: Life without a Modern Infrastructure –
Finance
Dif:: Medium
8. What was one of the first plant/factory types to use the “American System” of manufacturing?
a. Firearms
b. Steel
c. Oil
d. Automobiles
e. Chemicals
Answer: a
Title The World in 1840 – Conditions of Business in 1840: Life without a Modern Infrastructure –
Production Technology
Dif:: Medium
9. What economics game theory concept is demonstrated by the Erie Canal public works project?
a. Nash equilibrium
4
