Sample Test of Introduction to Business

Exam

Name___________________________________

1) A mixed market economy has elements of both a command economy and a market economy.

T or F

2) Entrepreneurship is restricted to small firms.

T or F

3) Which of the following motivates an entrepreneur to operate his or her business efficiently? 3) _____

A) Freedom of choice

B) Private property rights

C) The right to vote

D) Competition

E) Privatization

4) General Motors lowers its price of cars by 10%. Ford matches GM's price decrease. Each of these companies is practicing a type of pricing strategy characteristic of ________. 4) _____

A) a monopoly.

B) an oligopoly.

C) monopolistic competition.

D) controlled competition.

E) perfect competition.

5) Which of the following items is least likely to impact a nation's balance of payments? 5) _____

A) Trade deficits or surpluses

B) Gains or losses in exchanges of international currencies

C) An increase in the GDP

D) Money spent by tourists

E) Foreign aid programs

6) ________ is behaviour that individual beliefs and social norms define as wrong and bad. 6) _____

A) Unethical behaviour

B) Ethics

C) Ethical behaviour

D) Immoral behaviour

E) Business ethics

7) Sources of assistance for small business include all of the following except 7) _____

A) venture capitalists.

B) politicians.

C) government agencies.

D) banks.

E) consultants.

8) What is the major source of capital for small businesses? 8) _____

A) Sale of shares of stock

B) Bank loans

C) Venture capital firms

D) Personal investment by owners

E) It is not known what the major source of capital is.

9) Jack is one of the bank's most creditworthy customers. The interest rate available to Jack is the 9) _____

A) discount rate.

B) reserve requirement rate.

C) overnight rate.

D) rediscount rate.

E) prime rate.

10) With regard to GDP, GNP, and GPI, which of the following is correct? 10) _____

A) GDP increased as a result of the Exxon Valdez oil spill, but GPI decreased because of that spill.

B) They all measure...