BMGT 110F Final ACTUAL UPDATED
Exam Questions and CORRECT Answers
Categories of an income statement - CORRECT ANSWER - Revenue, COGS, expenses,
gross profit
Cost of Goods Sold (COGS) - CORRECT ANSWER - the cost of merchandise sold or
cost of raw materials and supplies used for producing items for resale.
Gross profit - CORRECT ANSWER - How much a firm earned by buying (or making)
and selling merchandise; the money left over after paying for the COGS
Gross profit equation - CORRECT ANSWER - gross profit = revenue - cost of goods sold
Net profit - CORRECT ANSWER - The amount left after operating expenses are
subtracted from the gross profit; how much money is made after all costs
Net profit equation - CORRECT ANSWER - Net Profit = Gross Profit - Expenses
Costs - CORRECT ANSWER - the amount of money needed to produce a good or service
Expenses - CORRECT ANSWER - the costs of operating a business (rent, utilities,
salaries)
Y axis of supply and demand curves - CORRECT ANSWER - price
X axis of supply and demand curve - CORRECT ANSWER - quantity (supplied or
demanded)
,Why does the demand curve slope down? - CORRECT ANSWER - the lower the price,
the greater the quantity demanded
Why does the supply curve slope up? - CORRECT ANSWER - There is a higher supply at
higher prices because higher prices provide an incentive for producers to supply more of the
good
intersection of supply and demand curves - CORRECT ANSWER - equilibrium
Equilibrium - CORRECT ANSWER - the state in which market supply and demand
balance each other, and as a result prices become stable
Fiscal policy - CORRECT ANSWER - Government policy that attempts to manage the
economy by controlling taxing and government spending
Monetary policy - CORRECT ANSWER - The Federal Reserve Bank managing the
money supply and interest rates
Inflation - CORRECT ANSWER - a general rise of prices of goods and services over time
Consumer Price Index - CORRECT ANSWER - Monthly statistics that measure the pace
of inflation or deflation
McGregor's Theory - CORRECT ANSWER - That there are two types of people: Type X
and Type Y
The Hawthorne effect - CORRECT ANSWER - how people tend to behave differently
when they know they are being studied/observed
Type X employees (McGregor) - CORRECT ANSWER - They dislike work and need to
be forced, controlled, or threatened to put effort into work
, Type Y employees (McGregor) - CORRECT ANSWER - They like work because it is as
natural as play or rest and are capable of using a lot of imagination, creativity, and cleverness to
solve problems
Maslow's Hierarchy of Needs - CORRECT ANSWER - There are 5 types of needs that are
based on the idea that motivation comes from needs; starts at physiological needs to self-
actualization
Herzberg's Theory - CORRECT ANSWER - Job satisfaction is influenced by hygiene
factors and motivators
motivators (Herzberg) - CORRECT ANSWER - factors that cause employees to be
productive and that give them satisfaction (ex. work itself, recognition, achievement,
responsibility)
hygiene factors (Herzberg) - CORRECT ANSWER - job factors that can cause
dissatisfaction if missing but that do not necessarily motivate employees if increased (ex.
working conditions, salary, job security, company policy and administration)
Private company - CORRECT ANSWER - A company that is owned by a person or a
group that is not on the public stock exchange
Public company - CORRECT ANSWER - A company that sells its stock to the general
public.
Personal income tax - CORRECT ANSWER - Money collected from individuals based on
the money they earn from jobs and investments; you pay a percentage of your income in tax
brackets
How is income tax calculated in the US? - CORRECT ANSWER - A progressive system
where people pay a percentage of their income based on their tax bracket
Exam Questions and CORRECT Answers
Categories of an income statement - CORRECT ANSWER - Revenue, COGS, expenses,
gross profit
Cost of Goods Sold (COGS) - CORRECT ANSWER - the cost of merchandise sold or
cost of raw materials and supplies used for producing items for resale.
Gross profit - CORRECT ANSWER - How much a firm earned by buying (or making)
and selling merchandise; the money left over after paying for the COGS
Gross profit equation - CORRECT ANSWER - gross profit = revenue - cost of goods sold
Net profit - CORRECT ANSWER - The amount left after operating expenses are
subtracted from the gross profit; how much money is made after all costs
Net profit equation - CORRECT ANSWER - Net Profit = Gross Profit - Expenses
Costs - CORRECT ANSWER - the amount of money needed to produce a good or service
Expenses - CORRECT ANSWER - the costs of operating a business (rent, utilities,
salaries)
Y axis of supply and demand curves - CORRECT ANSWER - price
X axis of supply and demand curve - CORRECT ANSWER - quantity (supplied or
demanded)
,Why does the demand curve slope down? - CORRECT ANSWER - the lower the price,
the greater the quantity demanded
Why does the supply curve slope up? - CORRECT ANSWER - There is a higher supply at
higher prices because higher prices provide an incentive for producers to supply more of the
good
intersection of supply and demand curves - CORRECT ANSWER - equilibrium
Equilibrium - CORRECT ANSWER - the state in which market supply and demand
balance each other, and as a result prices become stable
Fiscal policy - CORRECT ANSWER - Government policy that attempts to manage the
economy by controlling taxing and government spending
Monetary policy - CORRECT ANSWER - The Federal Reserve Bank managing the
money supply and interest rates
Inflation - CORRECT ANSWER - a general rise of prices of goods and services over time
Consumer Price Index - CORRECT ANSWER - Monthly statistics that measure the pace
of inflation or deflation
McGregor's Theory - CORRECT ANSWER - That there are two types of people: Type X
and Type Y
The Hawthorne effect - CORRECT ANSWER - how people tend to behave differently
when they know they are being studied/observed
Type X employees (McGregor) - CORRECT ANSWER - They dislike work and need to
be forced, controlled, or threatened to put effort into work
, Type Y employees (McGregor) - CORRECT ANSWER - They like work because it is as
natural as play or rest and are capable of using a lot of imagination, creativity, and cleverness to
solve problems
Maslow's Hierarchy of Needs - CORRECT ANSWER - There are 5 types of needs that are
based on the idea that motivation comes from needs; starts at physiological needs to self-
actualization
Herzberg's Theory - CORRECT ANSWER - Job satisfaction is influenced by hygiene
factors and motivators
motivators (Herzberg) - CORRECT ANSWER - factors that cause employees to be
productive and that give them satisfaction (ex. work itself, recognition, achievement,
responsibility)
hygiene factors (Herzberg) - CORRECT ANSWER - job factors that can cause
dissatisfaction if missing but that do not necessarily motivate employees if increased (ex.
working conditions, salary, job security, company policy and administration)
Private company - CORRECT ANSWER - A company that is owned by a person or a
group that is not on the public stock exchange
Public company - CORRECT ANSWER - A company that sells its stock to the general
public.
Personal income tax - CORRECT ANSWER - Money collected from individuals based on
the money they earn from jobs and investments; you pay a percentage of your income in tax
brackets
How is income tax calculated in the US? - CORRECT ANSWER - A progressive system
where people pay a percentage of their income based on their tax bracket
