Fundamentals of Business Final Exam
1. The loss of potential gain when one alternative is chosen over another: Op-
portunity Cost`
2. Market share; how much of the consumer market does a company have.: -
Market Capitalization
3. Framework used to monitor the macro-environmental factors on an en-
vironment: political, economical , social, technological, environmental, and
legal.: PESTEL Framework
4. international competition; products made internationally are usually cheap-
er- raising prices can threaten national security.: Global Forces
5. Stakeholders are those who are affected by decisions of a company; Internal
include: employees, managers, board of directors: Stakeholders; Internal
6. External: consumers, government, shareholders.: Stakeholders; external
7. Many buyers w/ relatively large number of sellers-low entry barriers and
sellers need to differentiate their products.( beauty, toothpaste): Monopolistic
Competition
8. Many Buyers and many sellers of a product; price is determined by supply
and demand (agricultural products): Pure Competition
9. Market Dominated by few suppliers- Price is controlled by competition and
barrier to enter is high. (Airplane, car, etc): Oligopoly
10. Only one seller with great power over the market. Entry is tough and prices
are determined by the seller.: Monopoly
11. Increase in prices and services over a period of time. Increased inflation
results in a decreased value of the spending dollar.: Inflation
12. Used as a measure of inflation; measures the changes in price of a product
or service bought by a household.: Consumer Price Index
13. % of a nations labor force that is unemployed at any time. Increased
in rate results in a decrease in jobs and a decreased amount of product
produced.: Unemployment Rate
14. GDP: total dollar value of all goods and services produced by all people in
a country within a year.: Gross Domestic Product
15. Allow for new strategies- New products/ lower prices.: Competitive Forces
16. Application of moral standards to business situations: acting morally
correct.: Business Ethics
17. What makes something good or bad is determined by whether it embodies
traits that are considered character defining ; courage, compassion, wisdom.-
: Virtue Theory
18. A decision is deemed bad or good depending on what produces the
maximum benefit for the most amount of people.: Utilitarianism
, Fundamentals of Business Final Exam
19. What is right or wrong is determined by the moral norms of the society of
which it is practiced in.: Relativism
20. When an employee takes advantage of a situation for his/her benefit rather
than that of the company. Ex: bribery: Conflict of interest
21. Free flow of information inside and outside a business.: Transparency
22. A person who exposes any kind of illegal or unethical behavior within an
organization; it is crucial for business to protect them in order for them to
come forward.: Whistleblower
23. Uniform policies, standards and punishments for ethics in a business- can
help maintain morality among internal stakeholders.: Code of Ethics
24. Decision where every alternative impacts various stakeholders in bad
ways: two choices to be made neither of which resolves the situation ethical-
ly.: Ethical Dilemma
25. Profit, People and Planet; business aren't only concerned about profit, but
with the people around and the environment/community.: Triple Bottom Line
26. Activites that meet the needs of the present without compromising the
ability of the future generations to meet their needs.: Sustainability
27. Bottom to Top: Economic, Legal, Ethical and Philanthropy. Business work
from bottom to top and strive to complete all four.: Pyramid of Corporate Social
Responsibility
28. Society will benefit the most when business is left alone to produce and
sell products that society needs.: Economic Model
29. Emphasis on profits and impact of business decisions on the society.
-Business is part of society, has resources, and helping resolve issues can
create a stable environment.: Socioeconomic MOdel
30. Selling and shipping raw materials or products to other nations: Exporting
31. Buying and shipping raw materials or products from other nations.: Import-
ing
32. Rate at which one country's currency will be exchanged for another;
determined based on a country's economy (interest rates, inflation, economic
strength): Currency Exchange Rate
33. Decrease in currency values--> exports increase and imports decrease.
Some countries will devalue currency to increase exports, and therefore jobs
and income.: Currency Devaluation
34. Value of exports minus the value of imports: Balance of Trade
35. Limiting the amount of a good that is allowed in a country. DOmestic
government doesn't get any money.: Quota
36. investing directly in foreign markets.: Foreign Direct Investment
, Fundamentals of Business Final Exam
37. Tax on imported goods- increases prices of imported goods--> less con-
sumers buying international products and more buying domestic product.
Domestic gov't gets money.: Tariffs
38. An official ban on imported goods: Embargo
39. Meant to limit international trade and designed to protect domestic prod-
uct. Can help protect industries, consumers and national security, but can
increase prices, limit choices and lead to inefficiencies.: Trade Barriers
40. EU(European Union), NAFTA (North American Free Trade Association),
APEC (Asia Pacific Economic Cooperation)--aim to reduce trade barriers,
increase flow of trade, promote peaceful relationships, and increase prosper-
ity.: Trade Agreements
41. offshoring: your company goes to china ( your own factory)
outsourcing: you pick a factory in another country to produce your product
(not your factory): Offshoring vs Outsourcing
42. Cultural Distance, Administrative and political distance, Geographical dis-
tance, and Economical distance.: CAGE distant framwork
43. Owned by usually one person; mostly small and very easy to start. (All
profits go to owner--unlimited liability): Sole Proprietorship
44. Partnership between one GP and and limited partner- the limited partner
invests in the business and that is the extent of their liability. They have no say
over managerial decisions within the business.: Limited Partnership
45. All the partners have the authority to make business and management
decisions. Liabilities, contributions and distributions are often equal, unless
otherwise noted in a legal contract.: General Partnership
46. Complete separate legal entity created by the law with specific rights (like
a person)--limited liability.: Corporation
47. Private limited company that combines the pass-through taxation of the
partnership and the limited liability of a corporation.: Limited Liability Corpora-
tion
48. A for-profit corporate entitiy tha looks to have a positive impact on society.
Ex; patagonia.: Benefit Corporation
49. Profits from the business go straight through the business and to the
owner, who reports profits and losses on their individual tax return. (Sole
proprietorships, LLC, partnership): Pass through Taxation
50. The corporate must pay taxes on company profits at a corporate rate-->
distributed dividends will be personally taxed again (double-taxation): Corpo-
rate taxation
51. Unlimited LIability; holds business owner personal for all the debts of the
business (Sole proprietorships, some partnerships)
1. The loss of potential gain when one alternative is chosen over another: Op-
portunity Cost`
2. Market share; how much of the consumer market does a company have.: -
Market Capitalization
3. Framework used to monitor the macro-environmental factors on an en-
vironment: political, economical , social, technological, environmental, and
legal.: PESTEL Framework
4. international competition; products made internationally are usually cheap-
er- raising prices can threaten national security.: Global Forces
5. Stakeholders are those who are affected by decisions of a company; Internal
include: employees, managers, board of directors: Stakeholders; Internal
6. External: consumers, government, shareholders.: Stakeholders; external
7. Many buyers w/ relatively large number of sellers-low entry barriers and
sellers need to differentiate their products.( beauty, toothpaste): Monopolistic
Competition
8. Many Buyers and many sellers of a product; price is determined by supply
and demand (agricultural products): Pure Competition
9. Market Dominated by few suppliers- Price is controlled by competition and
barrier to enter is high. (Airplane, car, etc): Oligopoly
10. Only one seller with great power over the market. Entry is tough and prices
are determined by the seller.: Monopoly
11. Increase in prices and services over a period of time. Increased inflation
results in a decreased value of the spending dollar.: Inflation
12. Used as a measure of inflation; measures the changes in price of a product
or service bought by a household.: Consumer Price Index
13. % of a nations labor force that is unemployed at any time. Increased
in rate results in a decrease in jobs and a decreased amount of product
produced.: Unemployment Rate
14. GDP: total dollar value of all goods and services produced by all people in
a country within a year.: Gross Domestic Product
15. Allow for new strategies- New products/ lower prices.: Competitive Forces
16. Application of moral standards to business situations: acting morally
correct.: Business Ethics
17. What makes something good or bad is determined by whether it embodies
traits that are considered character defining ; courage, compassion, wisdom.-
: Virtue Theory
18. A decision is deemed bad or good depending on what produces the
maximum benefit for the most amount of people.: Utilitarianism
, Fundamentals of Business Final Exam
19. What is right or wrong is determined by the moral norms of the society of
which it is practiced in.: Relativism
20. When an employee takes advantage of a situation for his/her benefit rather
than that of the company. Ex: bribery: Conflict of interest
21. Free flow of information inside and outside a business.: Transparency
22. A person who exposes any kind of illegal or unethical behavior within an
organization; it is crucial for business to protect them in order for them to
come forward.: Whistleblower
23. Uniform policies, standards and punishments for ethics in a business- can
help maintain morality among internal stakeholders.: Code of Ethics
24. Decision where every alternative impacts various stakeholders in bad
ways: two choices to be made neither of which resolves the situation ethical-
ly.: Ethical Dilemma
25. Profit, People and Planet; business aren't only concerned about profit, but
with the people around and the environment/community.: Triple Bottom Line
26. Activites that meet the needs of the present without compromising the
ability of the future generations to meet their needs.: Sustainability
27. Bottom to Top: Economic, Legal, Ethical and Philanthropy. Business work
from bottom to top and strive to complete all four.: Pyramid of Corporate Social
Responsibility
28. Society will benefit the most when business is left alone to produce and
sell products that society needs.: Economic Model
29. Emphasis on profits and impact of business decisions on the society.
-Business is part of society, has resources, and helping resolve issues can
create a stable environment.: Socioeconomic MOdel
30. Selling and shipping raw materials or products to other nations: Exporting
31. Buying and shipping raw materials or products from other nations.: Import-
ing
32. Rate at which one country's currency will be exchanged for another;
determined based on a country's economy (interest rates, inflation, economic
strength): Currency Exchange Rate
33. Decrease in currency values--> exports increase and imports decrease.
Some countries will devalue currency to increase exports, and therefore jobs
and income.: Currency Devaluation
34. Value of exports minus the value of imports: Balance of Trade
35. Limiting the amount of a good that is allowed in a country. DOmestic
government doesn't get any money.: Quota
36. investing directly in foreign markets.: Foreign Direct Investment
, Fundamentals of Business Final Exam
37. Tax on imported goods- increases prices of imported goods--> less con-
sumers buying international products and more buying domestic product.
Domestic gov't gets money.: Tariffs
38. An official ban on imported goods: Embargo
39. Meant to limit international trade and designed to protect domestic prod-
uct. Can help protect industries, consumers and national security, but can
increase prices, limit choices and lead to inefficiencies.: Trade Barriers
40. EU(European Union), NAFTA (North American Free Trade Association),
APEC (Asia Pacific Economic Cooperation)--aim to reduce trade barriers,
increase flow of trade, promote peaceful relationships, and increase prosper-
ity.: Trade Agreements
41. offshoring: your company goes to china ( your own factory)
outsourcing: you pick a factory in another country to produce your product
(not your factory): Offshoring vs Outsourcing
42. Cultural Distance, Administrative and political distance, Geographical dis-
tance, and Economical distance.: CAGE distant framwork
43. Owned by usually one person; mostly small and very easy to start. (All
profits go to owner--unlimited liability): Sole Proprietorship
44. Partnership between one GP and and limited partner- the limited partner
invests in the business and that is the extent of their liability. They have no say
over managerial decisions within the business.: Limited Partnership
45. All the partners have the authority to make business and management
decisions. Liabilities, contributions and distributions are often equal, unless
otherwise noted in a legal contract.: General Partnership
46. Complete separate legal entity created by the law with specific rights (like
a person)--limited liability.: Corporation
47. Private limited company that combines the pass-through taxation of the
partnership and the limited liability of a corporation.: Limited Liability Corpora-
tion
48. A for-profit corporate entitiy tha looks to have a positive impact on society.
Ex; patagonia.: Benefit Corporation
49. Profits from the business go straight through the business and to the
owner, who reports profits and losses on their individual tax return. (Sole
proprietorships, LLC, partnership): Pass through Taxation
50. The corporate must pay taxes on company profits at a corporate rate-->
distributed dividends will be personally taxed again (double-taxation): Corpo-
rate taxation
51. Unlimited LIability; holds business owner personal for all the debts of the
business (Sole proprietorships, some partnerships)
