Question 41 (2 points)

Depreciation recognizes that an asset (such as equipment) is generating income but will also need to be replaced at some point in the future and therefore loses value over time.

Question 41 options:

	True
	False

Chapter 5 - Economics

Question 42 (2 points)

When scaling up a business to achieve economies of scale, maintaining sufficient cash flow and achieving a good return on investment are challenges.

Question 42 options:

	True
	False

Question 43 (2 points)

The price elasticity of demand will always be a negative number as there is always a decrease in demand when the price is increased.

Question 43 options:

	True
	False

Question 44 (2 points)

A supply curve shows how increased demand pushes a products price down.

Question 44 options:

	True
	False

Question 45 (2 points)

Since the 1980s, the United States has maintained the price of sugar between 200% and 400% above the price in Canada and Mexico. The result (select all that apply):

Question 45 options:

	Companies have moved to Canada or Mexico to obtain lower cost sugar for their products.
	Jobs in agriculture have been maintained because of the higher profit margins earned by sugar producers.
	Sugar producers hire more employees with their increased profits.
	Manufacturing facilities for products that use sugar have closed due to the higher raw material costs.

Question 46 (2 points)

When the elasticity is less than one, then the demand is referred to as inelastic and the following occurs:

Question 46 options:

a)	Most consumers tend to not buy the product when the price increases.

b)	Demand increases when the price increases.

c)	Most consumers tend to buy the product even when the price increases.

d)	Consumers look to black markets to supply the products.

Chapter 6 - Strategy and Business Models

Question 47 (2 points)

A sunk cost fallacy describes a situation where a company continues spending more money on a product or strategy that is failing because they feel committed because of the money that has already been invested.

Question 47 options:

	True
	False

Question 48 (2 points)

Companies must never deviate from their strategy to stay in business and thrive.

Question 48 options:

	True
	False

Question 49 (2 points)

Understanding the history of the automobile industry offers important insights when developing strategies. One important lesson from the early years of the automobile industry is that change is constant.

Question 49 options:

	True
	False

Question 50 (2 points)

Ford began to lag behind GM starting in late 1920s because:

Question 50 options:

a)	The used car market was increasingly filling the need for entry level vehicles.

b)	The Ford Model T design was not changing and falling behind in technology to other offerings.

c)	General Motors began introduction more styling and annual model year changes in its vehicles.

d)	All of the above

Question 51 (2 points)

Which of the following indicate that a company may need to change its strategy.

Question 51 options:

a)	Competitors taking away customers.

b)	Changes in technology.

c)	Changing consumer tastes.

d)	All of the above.

e)	None of the above.

Chapter 7 - Marketing: Providing Value for Customers

Question 52 (2 points)

Cross functional integration means that a companys organizational functions are managed so they are working cohesively, that is, toward the same goal of satisfying the customer.

Question 52 options:

	True
	False

Question 53 (2 points)

Profit orientation means the firm focuses on a developing products or services that better serve target customer needs while helping maximize the firms profits over the long run.

Question 53 options:

	True
	False

Question 54 (2 points)

A toolbox for the promotion aspect of marketing may include advertising, personal selling, sales promotions, publicity, public relations, direct marketing, or word-of-mouth.

Question 54 options:

	True
	False

Question 55 (2 points)

Setting the price for a product or service is best done using a professional marketers intuition.

Question 55 options:

	True
	False

Question 56 (2 points)

Which of the following statements best describes the marketing function.

Question 56 options:

a)	Marketing is solely focused on sales and executing advertising purchases.

b)	Marketing is really a popular term for a public relations function that ensures the reputation of the corporations leadership is protected.

c)	Marketing builds, maintains, and manages relationships through creating, communicating, delivering, and exchanging offerings that have value.

d)	None of the above.

Chapter 8 - Leadership in Business Organizations

Question 57 (2 points)

Which type of power leads to the highest level of committment?

Question 57 options:

	Legitimate
	Reward
	Expert
	Referent
	Coercive

Question 58 (2 points)

Bases of power in leadership are classified in the following categories.

Select all that apply.

Question 58 options:

	Personal
	Position
	Professional
	Political

Question 59 (2 points)

The three major actions in leadership are:

Select all that apply.

Question 59 options:

	Improving
	Executing
	Influencing
	Planning
	Operating

Question 60 (2 points)

Influence is the most critical factor in the definition of leadership.

Question 60 options:

	True
	False