SEVI EXAM QUESTIONS AND ANSWERS
Which of the following best defines a business in this course? - Answer -An
organization that engaging in producing or selling goods and services to create
economic and social value
Most countries in the world today have economies that demonstrate aspects of both
capitalism and socialism; they are therefore characterized as____________ economies
- Answer -Mixed
Which of the following would you use to determine whether inflation is affecting
consumers? - Answer -Consumer price index
Although all casual clothing ultimately provides the same purpose, Old Navy strives to
make its brand seem unique from the many other brands available on the market. The
market for Old Navy's casual clothing can be characterized as
________________________ - Answer -Monopolistic Competition
In a market with a relatively large number of sellers, companies try to develop and
promote unique features, unique packaging, and/or free delivery, as process known as
____________________ - Answer -Product Differentiation
If South Korea were regarded as the best electronics manufacturer in the world, which
of the following would most likely be true? - Answer -South Korea would have an
absolute advantage in electronics production
Apple itself does not assembly or component factories and contracts with Foxconn to
manufacture Apple products (including iPhone) in China. Apple engaged in what type of
international expansion. - Answer -Contract manufacturing
Forming a joint venture with an existing foreign company offers all of the following
except _______________. - Answer -Requiring less commitment from all parties
involved in the joint venture
When 7-Eleven contracts with Oscar to operate an individually owned business as
though it were a part of the 7-Eleven is a(n) - Answer -Franchisor
Which of the following best defines a growth mindset - Answer -The idea that effort and
persistence can lead to the development of skills and intelligence
Rhetta has an idea for a freelance technical writing business that would create content
for technical journals and websites. She can write anywhere she can connect to on the
internet, which will give her flexibility to participate in her other interests. She would not
need an office outside of her home because she could see clients at their place of
business or in a coffee shop, or via Skype or Zoom. She does not want to share control
, of the business because she feels like this would stifle her creativity. She foresees no
liabilities and very few start up costs - She already has a computer with internet
connection. She would like to start her freelance business tomorrow and has set up a
website, created social media accounts, and prepared emails to send out to potential
clients. What would be the best business form for Rhetta's Business? - Answer -Sole
proprietorship
What does double taxation mean? - Answer -Companies must pay taxes on their
earnings, and then stockholders pay taxes on their dividends.
If Domino's Pizza and Little Caesar's Pizza united to become the new company of
Emperor's Pizza, what type of transaction would create the company? - Answer -
Horizontal Merger
Which of the following statements best explains the essence of the resource-based view
(RBV)? - Answer -Unique resources that are valuable, rare, inimitable, and non-
substitutable are the source of competitive advantage.
Why is SWOT analysis important for Businesses? - Answer -It provides a structured
approach to assessing both internal and external factors affecting business success.
Definition of business - Answer -the organized effort of individuals to produce and sell,
for a profit, the goods and services that satisfy society's needs
Negative profit / bankruptcy - Answer -Negative retained earnings often show that a
company is experiencing long-term losses and can be an indicator of bankruptcy.
Stakeholders - Answer -All the people who stand to gain or lose by the policies and
activities of a business and whose concerns the business needs to address.
Shareholder/Stakeholder Theory - Answer -Shareholder theory:
Focuses on maximizing profits for shareholders
Stakeholder theory:
Considers the interests of a broader group of people, including employees, customers,
suppliers, and the community
Mixed Economy - Answer -An economy in which private enterprise exists in
combination with a considerable amount of government regulation and promotion.
Capitalism - Answer -An economic system based on private ownership of capital
Inflation / CPI - Answer -A general rise in the prices of goods and services over time (a
percentage)
Real GDP - Answer -The production of goods and services valued at constant prices
Which of the following best defines a business in this course? - Answer -An
organization that engaging in producing or selling goods and services to create
economic and social value
Most countries in the world today have economies that demonstrate aspects of both
capitalism and socialism; they are therefore characterized as____________ economies
- Answer -Mixed
Which of the following would you use to determine whether inflation is affecting
consumers? - Answer -Consumer price index
Although all casual clothing ultimately provides the same purpose, Old Navy strives to
make its brand seem unique from the many other brands available on the market. The
market for Old Navy's casual clothing can be characterized as
________________________ - Answer -Monopolistic Competition
In a market with a relatively large number of sellers, companies try to develop and
promote unique features, unique packaging, and/or free delivery, as process known as
____________________ - Answer -Product Differentiation
If South Korea were regarded as the best electronics manufacturer in the world, which
of the following would most likely be true? - Answer -South Korea would have an
absolute advantage in electronics production
Apple itself does not assembly or component factories and contracts with Foxconn to
manufacture Apple products (including iPhone) in China. Apple engaged in what type of
international expansion. - Answer -Contract manufacturing
Forming a joint venture with an existing foreign company offers all of the following
except _______________. - Answer -Requiring less commitment from all parties
involved in the joint venture
When 7-Eleven contracts with Oscar to operate an individually owned business as
though it were a part of the 7-Eleven is a(n) - Answer -Franchisor
Which of the following best defines a growth mindset - Answer -The idea that effort and
persistence can lead to the development of skills and intelligence
Rhetta has an idea for a freelance technical writing business that would create content
for technical journals and websites. She can write anywhere she can connect to on the
internet, which will give her flexibility to participate in her other interests. She would not
need an office outside of her home because she could see clients at their place of
business or in a coffee shop, or via Skype or Zoom. She does not want to share control
, of the business because she feels like this would stifle her creativity. She foresees no
liabilities and very few start up costs - She already has a computer with internet
connection. She would like to start her freelance business tomorrow and has set up a
website, created social media accounts, and prepared emails to send out to potential
clients. What would be the best business form for Rhetta's Business? - Answer -Sole
proprietorship
What does double taxation mean? - Answer -Companies must pay taxes on their
earnings, and then stockholders pay taxes on their dividends.
If Domino's Pizza and Little Caesar's Pizza united to become the new company of
Emperor's Pizza, what type of transaction would create the company? - Answer -
Horizontal Merger
Which of the following statements best explains the essence of the resource-based view
(RBV)? - Answer -Unique resources that are valuable, rare, inimitable, and non-
substitutable are the source of competitive advantage.
Why is SWOT analysis important for Businesses? - Answer -It provides a structured
approach to assessing both internal and external factors affecting business success.
Definition of business - Answer -the organized effort of individuals to produce and sell,
for a profit, the goods and services that satisfy society's needs
Negative profit / bankruptcy - Answer -Negative retained earnings often show that a
company is experiencing long-term losses and can be an indicator of bankruptcy.
Stakeholders - Answer -All the people who stand to gain or lose by the policies and
activities of a business and whose concerns the business needs to address.
Shareholder/Stakeholder Theory - Answer -Shareholder theory:
Focuses on maximizing profits for shareholders
Stakeholder theory:
Considers the interests of a broader group of people, including employees, customers,
suppliers, and the community
Mixed Economy - Answer -An economy in which private enterprise exists in
combination with a considerable amount of government regulation and promotion.
Capitalism - Answer -An economic system based on private ownership of capital
Inflation / CPI - Answer -A general rise in the prices of goods and services over time (a
percentage)
Real GDP - Answer -The production of goods and services valued at constant prices
