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BUSINESS MAJOR FIELD TEST 2025
QUESTIONS AND ANSWERS.
1. Cost, volume, and profit analysis -correct answer - used to
determine how changes in costs and volume affect a
company's operating income and net income
2. Standard costing -correct answer - practice of substituting an
expected cost for an actual cost in the accounting records, and
then periodically recording variances showing the difference
between the expected and actual costs
3. Production possibilities frontier -correct answer - a curve
depicting all maximum output possibilities for two goods, given
a set of inputs consisting of resources and other factors.
Factors such as labor, capital and technology, will affect the
resources available
4. Comparative advantage and specialization -correct answer -
describe the basic economic benefits that countries get from
trading with one another.
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5. Comparative advantage -correct answer - the ability of any
given economic actor to produce goods and services at a lower
opportunity cost than other economic factors
6. Models of consumer choice -correct answer - analyzes how
consumers maximize the desirability of their consumption as
measured by their preferences subject to limitations on their
expenditures
7. Monopolistic competition -correct answer - many producers sell
products or services that are differentiated from one another
(e.g. by branding or quality); not perfect substitutes
8. Resource market -correct answer - a market where a business
can go and purchase resources to produce goods and services
9. Aggregate demand -correct answer - the total demand for final
goods and services in an economy at a given time
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10. Aggregate supply -correct answer - total amount of goods
and services that firms are willing and able to sell at a given
price level in an economy
11. Monetary policy -correct answer - the process by which a
government controls the supply of money, often targeting an
inflation rate or interest rate to ensure price stability
12. Fiscal policy -correct answer - the means by which a
government adjusts its spending levels and tax rates to monitor
and influence a nation's economy
13. Linear programming -correct answer - a technique for
maximizing or minimizing a linear function of several variables,
such as output or cost
14. PERT -correct answer - project evaluation and review
technique designed to analyze and represent the tasks
involved in completing a given project
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15. Time value of money -correct answer - idea that money
available at the present time is worth more than the same
amount in the future due to its potential earning capacity
16. Capital budgeting -correct answer - the planning process
used to determine whether an organization's long term
investments such as replacement of machinery, and research
development are worth the funding of cash through the firm's
capital
17. Working capital management -correct answer - ensure that a
firm is able to continue its operations and that it has sufficient
ability to satisfy both maturing short-term debt and upcoming
operational expenses
18. Cost of capital -correct answer - the opportunity cost of
making a specific investment
19. Capital structure -correct answer - how a firm finances its
overall operations and growth by using different sources of
funds
BUSINESS MAJOR FIELD TEST 2025
QUESTIONS AND ANSWERS.
1. Cost, volume, and profit analysis -correct answer - used to
determine how changes in costs and volume affect a
company's operating income and net income
2. Standard costing -correct answer - practice of substituting an
expected cost for an actual cost in the accounting records, and
then periodically recording variances showing the difference
between the expected and actual costs
3. Production possibilities frontier -correct answer - a curve
depicting all maximum output possibilities for two goods, given
a set of inputs consisting of resources and other factors.
Factors such as labor, capital and technology, will affect the
resources available
4. Comparative advantage and specialization -correct answer -
describe the basic economic benefits that countries get from
trading with one another.
, Page | 2
5. Comparative advantage -correct answer - the ability of any
given economic actor to produce goods and services at a lower
opportunity cost than other economic factors
6. Models of consumer choice -correct answer - analyzes how
consumers maximize the desirability of their consumption as
measured by their preferences subject to limitations on their
expenditures
7. Monopolistic competition -correct answer - many producers sell
products or services that are differentiated from one another
(e.g. by branding or quality); not perfect substitutes
8. Resource market -correct answer - a market where a business
can go and purchase resources to produce goods and services
9. Aggregate demand -correct answer - the total demand for final
goods and services in an economy at a given time
, Page | 3
10. Aggregate supply -correct answer - total amount of goods
and services that firms are willing and able to sell at a given
price level in an economy
11. Monetary policy -correct answer - the process by which a
government controls the supply of money, often targeting an
inflation rate or interest rate to ensure price stability
12. Fiscal policy -correct answer - the means by which a
government adjusts its spending levels and tax rates to monitor
and influence a nation's economy
13. Linear programming -correct answer - a technique for
maximizing or minimizing a linear function of several variables,
such as output or cost
14. PERT -correct answer - project evaluation and review
technique designed to analyze and represent the tasks
involved in completing a given project
, Page | 4
15. Time value of money -correct answer - idea that money
available at the present time is worth more than the same
amount in the future due to its potential earning capacity
16. Capital budgeting -correct answer - the planning process
used to determine whether an organization's long term
investments such as replacement of machinery, and research
development are worth the funding of cash through the firm's
capital
17. Working capital management -correct answer - ensure that a
firm is able to continue its operations and that it has sufficient
ability to satisfy both maturing short-term debt and upcoming
operational expenses
18. Cost of capital -correct answer - the opportunity cost of
making a specific investment
19. Capital structure -correct answer - how a firm finances its
overall operations and growth by using different sources of
funds
