ETS MBA STUDY GUIDE LATEST
UPDATED
1. Which of the following organizations is most likely
to use project financing?
(A) A small start-up
(B) A financial services firm with an extensive
client list
(C) A large consumer goods company
(D) A large public utility involved in
infrastructure development - Correct Answers -D
2. After an extensive recruitment process to select
well-qualified individuals, a large percent of
a company's new hires resigned within the first
month of the job. Which of the following is the
most likely explanation for this situation?
(A) The training process to prepare the new hires
for their assigned tasks was inadequate.
(B) The health benefits provided by the company
were not competitive with those of the rest
of the industry.
(C) The starting salary for the new hires was not
competitive with that of the rest of the
industry.
(D) The new hires lacked the basic skills required
to learn the job. - Correct Answers -A
3. Prosco Ltd. employs a process cost system.
Inspection of units occurs at the 50 percent mark.
Defective units are then removed from the process,
and their cost ($4.50) is absorbed by the good units.
Prosco has recently been approached by a firm
wishing to buy the defective units for a special use.
The firm would require Prosco to modify the
defective units at a unit cost of $2.00. If Prosco
sells the defective units to the firm for $5.00 each,
how would Prosco's reported income be affected?
(A) It would decrease by $4.50 per unit sold.
(B) It would decrease by $1.50 per unit sold.
(C) It would increase by $3.00 per unit sold.
, (D) It would increase by $5.00 per unit sold. - Correct Answers –C
18. Which of the following should be reported net
of tax on a corporation's income statement?
(A) Discontinued operations
(B) Operating income
(C) Gross profit
(D) Gain on sale of delivery truck - Correct Answers -A
19. If a multinational company cannot change the
level of political risk in foreign markets, which of
the following tactics would most likely offset
possible losses?
(A) Maintain control of distribution
(B) Use currency futures contracts
(C) Finance debt locally
(D) Maintain control of key inputs - Correct Answers -C
20. Blessed Bundles is a regional clicks-and-mortar
retail chain that sells maternity and baby products.
It uses data from past purchases to study
customers' product preferences, and it uses server
tracking logs to study customers' online shopping
behavior. Which of the following correctly
describes the two types of market research data
the company is using?
Past Purchases Server Tracking Logs
(A) Transactional Clickstream
(B) Clickstream Transactional
(C) Private Public
(D) Public Private - Correct Answers -A
21. If Fjord successfully implements the new
technology, the move will most likely result in
(A) a decrease in total and variable cost and an
increase in fixed cost
(B) a decrease in total cost, an increase in
variable cost, and a decrease in fixed cost
(C) an increase in revenue and a decrease in
variable cost and fixed costs.
(D) an increase in revenue, a decrease in variable
cost, and an increase in fixed cost - Correct Answers -A
4. Some companies have little, if any, net income or
earnings, yet they seem to have all the money they
need for capital expenditures. Which of the
UPDATED
1. Which of the following organizations is most likely
to use project financing?
(A) A small start-up
(B) A financial services firm with an extensive
client list
(C) A large consumer goods company
(D) A large public utility involved in
infrastructure development - Correct Answers -D
2. After an extensive recruitment process to select
well-qualified individuals, a large percent of
a company's new hires resigned within the first
month of the job. Which of the following is the
most likely explanation for this situation?
(A) The training process to prepare the new hires
for their assigned tasks was inadequate.
(B) The health benefits provided by the company
were not competitive with those of the rest
of the industry.
(C) The starting salary for the new hires was not
competitive with that of the rest of the
industry.
(D) The new hires lacked the basic skills required
to learn the job. - Correct Answers -A
3. Prosco Ltd. employs a process cost system.
Inspection of units occurs at the 50 percent mark.
Defective units are then removed from the process,
and their cost ($4.50) is absorbed by the good units.
Prosco has recently been approached by a firm
wishing to buy the defective units for a special use.
The firm would require Prosco to modify the
defective units at a unit cost of $2.00. If Prosco
sells the defective units to the firm for $5.00 each,
how would Prosco's reported income be affected?
(A) It would decrease by $4.50 per unit sold.
(B) It would decrease by $1.50 per unit sold.
(C) It would increase by $3.00 per unit sold.
, (D) It would increase by $5.00 per unit sold. - Correct Answers –C
18. Which of the following should be reported net
of tax on a corporation's income statement?
(A) Discontinued operations
(B) Operating income
(C) Gross profit
(D) Gain on sale of delivery truck - Correct Answers -A
19. If a multinational company cannot change the
level of political risk in foreign markets, which of
the following tactics would most likely offset
possible losses?
(A) Maintain control of distribution
(B) Use currency futures contracts
(C) Finance debt locally
(D) Maintain control of key inputs - Correct Answers -C
20. Blessed Bundles is a regional clicks-and-mortar
retail chain that sells maternity and baby products.
It uses data from past purchases to study
customers' product preferences, and it uses server
tracking logs to study customers' online shopping
behavior. Which of the following correctly
describes the two types of market research data
the company is using?
Past Purchases Server Tracking Logs
(A) Transactional Clickstream
(B) Clickstream Transactional
(C) Private Public
(D) Public Private - Correct Answers -A
21. If Fjord successfully implements the new
technology, the move will most likely result in
(A) a decrease in total and variable cost and an
increase in fixed cost
(B) a decrease in total cost, an increase in
variable cost, and a decrease in fixed cost
(C) an increase in revenue and a decrease in
variable cost and fixed costs.
(D) an increase in revenue, a decrease in variable
cost, and an increase in fixed cost - Correct Answers -A
4. Some companies have little, if any, net income or
earnings, yet they seem to have all the money they
need for capital expenditures. Which of the
