Test Bank – Business: A Changing World, Canadian 6th Edition (O. C. Ferrell) All Chapters

TRUE/FALSE. Write 'T' if the statement is true and 'F' if the statement is false.

1) Products have tangible attributes only.
Answer: True False

2) The goal of business activities is to earn a profit.
Answer: True False

3) Non-profit organizations, such as the Canadian Red Cross, do not have to engage in management,
marketing, or finance activities.
Answer: True False
N
4) Organizations such as the Special Olympics have two fundamental purposes: to earn a profit and to
accomplish social objectives.
Answer: True False
U
5) Profit is what it costs to make and sell a product.
Answer: True False
R
6) Businesses have the right to keep and use their profits as they choose, without limitations.
Answer: True False

7)
SE
Earning profits contributes to society by providing employment, which in turn provides money that
is reinvested in the economy.
Answer: True False

8) Finance is concerned with obtaining money and using it effectively.
Answer: True False
D
9) Owners have little responsibility to provide funds for the operation of the business.
Answer: True False
O
10) Managers coordinate resources to achieve organizational objectives.
Answer: True False

11) The focus of all marketing activities is customer satisfaction.
C
Answer: True False

12) Owners always manage their businesses themselves.
S
Answer: True False

13) Studying business will help you develop skills to employ in a future career, if that career takes place
in the country where you studied business topics.
Answer: True False




1

,14) One of the best-known Canadian marketing initiatives of all time is Tim Hortons' "Roll Up the Rim
to Win" campaign.
Answer: True False

15) A central issue of economics is how to fulfill consumers' unlimited demand for goods and services
in a world with limited resources.
Answer: True False

16) Naturalresources include land, minerals, water, and other gifts of nature which are not made by
humans.
Answer: True False
N
17) As the baby boomers, who make up roughly one-third of Canada's population, retire, Canada may
face a labour shortage in some sectors.
U
Answer: True False

18) Capitalism is an economic system in which the government owns and operates basic industries
R
while individuals own most other businesses.
Answer: True False

19) China
is an example of a communist economy that exists today which satisfies Karl Marx's ideal of
SE
communism.
Answer: True False

20) Russia,Poland, Hungary, and other Eastern European nations have turned away from communism
and toward economic systems governed by supply and demand rather than by central planning.
Answer: True False
D
21) The Chinese state is the largest shareholder among China's largest companies and influences
thousands of other businesses.
Answer: True False
O
22) Most socialist nations are democratic.
Answer: True False
C
23) Human resources refer only to the mental abilities of people used to produce goods and services; it
is synonymous with knowledge.
Answer: True False
S
24) Iffree enterprise is going to be successful, individuals must have the right to choose what career to
pursue, where to live, what goods and services to purchase, and more.
Answer: True False

25) Demand is the quantity of goods and services that consumers are willing to buy at different prices at
a specific time.
Answer: True False

2

,26) The demand curve is upward sloping.
Answer: True False

27) The equilibrium price is represented by the point where a product's supply and demand curves
intersect.
Answer: True False

28) Monopolistic competition exists when there is only one producer of a product in a given market.
Answer: True False

29) An oligopoly exists when there are many small businesses selling one standardized product.
N
Answer: True False

30) Government-granted monopolies are not subject to government-regulated prices.
U
Answer: True False

31) Aproduct's equilibrium price is constantly changing in response to changes in economic conditions,
availability of resources, and degree of competition.
R
Answer: True False

32) Economic expansion occurs when an economy is growing and people are spending more money.
SE
Answer: True False

33) The standard of living rises because people have less money to spend.
Answer: True False

34) Inflation is a condition characterized by falling prices.
D
Answer: True False

35) A severe recession may turn into a depression.
Answer: True False
O
36) During a recession, unemployment is unusually low.
Answer: True False
C
37) Gross domestic product is the sum of all goods and services produced in a country during a year.
Answer: True False
S
38) Since 1997, it has been common policy for the government of Canada to run large budget deficits.
Answer: True False

39) Canada has had a positive trade balance for much of the last decade.
Answer: True False

40) When a nation collects more from taxes than it spends, it has a budget deficit.
Answer: True False


3

, 41) Industrialization mostly occurred in Central Canada.
Answer: True False

42) The Canadian Pacific Railway linked Canada from north to south.
Answer: True False

43) Advertising first made consumers aware of differences in products and prices in the marketing
economy.
Answer: True False

44) Entrepreneurs
risk their wealth, time, and effort to develop for profit an innovative product or way
N
of doing something.
Answer: True False
U
45) Entrepreneurship is essential to a free-enterprise system.
Answer: True False

46) In a free-market system, the government regulates business.
R
Answer: True False

47) Free-market capitalism and laissez-faire capitalism are essentially the same thing.
SE
Answer: True False

48) Research has shown that ethical behaviour cannot only enhance a company's reputation but can also
drive profits.
Answer: True False

49) Society demands
D
ethical and socially responsible business behaviour towards customers and
investors only. There seems to be less of a concern for other stakeholder groups including
government regulators and the environment.
Answer: True False
O
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.

50) Businesses differ from non-profit organizations in that a business' focus is on:
C
A) goods.
B) price.
C) plans.
S
D) organization.
E) profits.
Answer: E




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