Chapter 6
In order to improve his chances of small business success, Demitri prepared a business plan. Most often, a positive outcome of this exercise is:
A) the plan will protect Demitri from failure.
B) the plan enables Demitri to think carefully about all aspects of his business idea.
C) the plan will meet federal reporting requirements of the Internal Revenue Service.
D) the plan ensures financing will be available from the Small Business Administration.
B) the plan enables Demitri to think carefully about all aspects of his business idea.
When a firm makes use of SWOT analysis, one of its objectives is to:
A) identify the best employees to fill each position within the organization.
B) evaluate the desirability of issuing stocks or bonds in the current financial climate.
C) identify the things it does well as an organization and the things it needs to improve.
D) set specific short-term performance standards for each department.
C) identify the things it does well as an organization and the things it needs to improve.
Than Wok emigrated from his war-tom country to the US. almost two years ago. He recently found a job working on an assembly line at a major computer manufacturer. Than left his friends and family behind when he came to the United States. He is lonely and hopes that his fellow employees will accept him so that he can build some lasting friendships. According to Maslow, Than wants to satisfy his:
A) social needs.
B) physiological needs.
C) self-actualization needs.
D) safety needs.
A) social needs.
New employees at Throneberry Manufacturing are carefully trained to use the most efficient production methods. They are then placed on an assembly line and expected to perform the same task day after day, using the methods they were taught. The work is boring, but the pay is good. Throneberry's approach is consistent with the principles of:
A) management by objectives.
B) scientific management.
C) expectancy theory.
D) human engineering
B) scientific management.
Peppy is confident that Peppy's Pizzazzeria will be a success, but only if he has enough money to do things right. Since Peppy has very little personal wealth, he knows he must obtain financial assistance. In order prepare for meetings with bankers and potential investors, Peppy should:
A) develop a business plan.
B) read a book on entrepreneurship.
C) hire a public relations firm to develop promotional materials.
D) create a partnership contract.
A) develop a business plan.
Two years ago, Travis started his own restaurant supply company, serving the greater Chicago area. Until recently, he has never concerned himself with establishing a formal control system. Now, with a recession looming, he is experiencing cost-conscious restaurant owners. He has decided that a formal control system is needed. The first step Travis should take is:
A) devise a set of clear performance standards.
B) draw up a formal organization chart.
C) talk to his banker to set financial goals.
D) design an accident report form so that he can keep accurate records of all accidents that occur.
A) devise a set of clear performance standards.
Carlos had been thinking of setting up a graphic design service business for quite some time. He knew that he wanted to work at home and he now had several leads for prospective customers. He also knew how much money he needed to make to cover his expenses. He had several ways to approach his new business including working by himself or taking on a partner. Both ways needed more thought to determine what each would involve. In terms of the rational decision-making model, Carlos is in which of the following steps?
A) Develop alternatives
B) Determining if the decision was a good one
C) Defining the situation
D) Describing and collecting needed information
A) Develop alternatives
When establishing criteria to measure the success of a customer-oriented business, managers should:
A) focus most of their attention on measures of employee satisfaction, since without good employees the firm will not be competitive.
B) limit their attention to financial measures such as profit and return on investment since these are the only objective and quantifiable measures available.
C) focus primarily on financial measures, but pay some attention to nonfinancial concerns.
D) recognize that, while financial measures are important and should be considered, the purpose of the firm is to satisfy both internal and external customers.
D) recognize that, while financial measures are important and should be considered, the purpose of the firm is to satisfy both internal and external customers.
At Solar Concepts, Inc., employees are promised long-term employment and are involved in decision making. The employees follow a somewhat specialized career path and have individual responsibility for results. Solar Concept's approach is an example of:
A) Theory Y management.
B) Theory X management.
C) Theory Z management.
D) Theory R management.
C) Theory Z management.
Due to the fact that Peppy has worked in the field of marketing for a large corporation:
A) he knows that the type of business he wants to start may be difficult to develop, but it has a tremendous amount of security due to its promise of long-term survival.
B) he plans to put together an entrepreneurial team of experts that will complement his expertise.
C) there is no need to consider an entrepreneurial team for start-up due to the fact that all other management functions are served by marketing.
D) he can skip any marketing research steps that the SBA recommends.
B) he plans to put together an entrepreneurial team of experts that will complement his expertise.
Becca is a manager in the credit department for 3STAR Motors. Joe Greene is a new employee in her department. While Joe has been learning his job, Becca has provided him with guidance by offering advice, encouragement, and instructions. However, she is careful to let Joe do the actual work, even if he struggles a bit. Becca's approach to getting Joe up to speed indicates that she is:
A) helping Joe rather than coaching him.
B) familiar with the leading principles of scientific management.
C) both coaching and helping Joe.
D) coaching Joe rather than helping him.
D) coaching Joe rather than helping him.
After working for eleven years as a production line worker, Hollis recently was made a foreman. In his new position, Hollis will rely on:
A) accounting and financial skills.
B) technical skills and human relations skills more than conceptual skills.
C) conceptual skills more than human relations skills.
D) technical skills and conceptual skills, but he won't really need any human relations skills
B) technical skills and human relations skills more than conceptual skills
As a small business owner, Tanika can't afford to provide her employees with the high wages and benefits offered by big corporations. One way to retain her employees and create a high level of motivation would be to:
A) empower her employees to develop their own ideas.
B) hire only family members, since they are more loyal.
C) constantly communicate with them that "at least they have a job."
D) adopt a policy of promoting workers who have been employed the longest.
A) empower her employees to develop their own ideas.
Maalem is a refugee from Ethiopia who has none of the basic necessities Americans take for granted. He lives in an overcrowded tent in a refugee camp. He is often hungry and thirsty because food is scarce in the camp and the main water supply is polluted. According to Maslow, Maalem will be motivated to satisfy his needs, before addressing other concerns.
A) physiological
B) social
C) self-actualization
D) safety
A) physiological
11) Jayne started a small bakery in a resort town. She was certain she had the ideal location, with plenty of hotels and inns within walking distance of her establishment. She planned to use her grandmother's recipes, using only the finest ingredients for her upscale resort customers. During the first week of business, she was disappointed with lackluster sales. When she drove past the regular breakfast-style restaurants and even the Starbucks, she noticed they were rather bustling. Jayne most likely:
A) did not consider that small businesses never get the name recognition in resort towns that larger businesses and franchises realize.
B) underestimated the competition.
C) should have considered weather conditions before assuming that her business would be vibrant.
D) did not publicize in the appropriate places.
B) underestimated the competition.
Lynn is in charge of a nursing shift at a hospital. She wants to improve the motivation 6) __ _ and performance level of the nurses under her direction. According to expectancy theory, one element of an effective motivational strategy is to:
A) determine what types of rewards are valued by the nurses.
B) rotate the nurses so that they perform different jobs each day.
C) set performance standards that are beyond the ability of most nurses to challenge them to achieve.
D) simplify the job.
A) determine what types of rewards are valued by the nurses.
Which of the following best summarizes the type of leader future organizations are likely to need? In the future, organizations will need leaders who:
A) are effective at using autocratic techniques.
B) have a strong track record of focusing on the accomplishment of financial objectives.
C) provide the sense of stability and orderliness the organization needs to withstand the challenges posed by a changing environment.
D) supply both a vision and a moral and ethical foundation for growth.
D) supply both a vision and a moral and ethical foundation for growth.
Harper is a sales rep for an eyeglass company. The company is always on the cutting edge of trendy designs. In her job, she frequently relies on the marketing department to provide her with information and materials. When using customer satisfaction to judge the success of their company, Harper's managers should:
A) consider Harper's satisfaction, but place less emphasis on it than on the satisfaction of a stockholder, since she is an external customer.
B) ignore Harper's satisfaction, since she is an employee rather than a customer.
C) take Harper's satisfaction into account, because customers can be internal as well as external.
D) consider Harper's satisfaction only if she has worked in the same job for at least two years.
C) take Harper's satisfaction into account, because customers can be internal as well as external.
Although the overall unemployment rate during the past recession hovered between 9 and 10%, the unemployment rate for Millennials was much higher. As this generation struggled to find employment, they were often compelled to continue to live with their parents. Due to current economic concerns, this younger generation was struggling to fulfill
A) self-actualization needs
B) esteem needs
C) safety needs
D) physiological needs
D) physiological needs
Carrie, a student at Metropolitan Community College, dreams of starting her own business. In an effort to learn as much as she can about small business management, she talked to four friends who each offered their advice. Which of these suggestions is likely to help Carrie the most?
A) Starting and managing a small business requires little more than common sense. If your idea is unique, hard work will guarantee your success.
B) Since every business is unique, don't worry about advice from others. Go to a bank, get a business loan, and live your dream.
C) Take courses related to small business management and look for a job with a successful businessperson, preferably in your field of interest.
D) The best way to learn about running a business is by getting hands-on experience. You should quit school and put your dream into action.
C) Take courses related to small business management and look for a job with a successful businessperson, preferably in your field of interest.
Customers who shop on Amazon find it helpful to read the customer reviews associated with products that others have purchased. After making a purchase, the customer can go to Amazon's website and post his/her opinion of the product recently purchased. This strategy not only assists other customers with their decision making, it helps Amazon react more quickly to the performance of the products it sells. Which of the following statements attests to the value of this service?
A) This action provides for complete transparency of company financial performance.
B) This action supports a key criterion of the control function: the measurement of customer satisfaction.
C) This action supports the premise of recruiting, hiring, and motivating the employees who believe in social media and other ways to reach customers.
D) This action provides for better tactical planning, particularly the budgeting process.
B) This action supports a key criterion of the control function: the measurement of customer satisfaction.
The CEO of peripheral company QuickDrive uses a leadership style that encourages employees to discuss management issues with the CEO and to work together to resolve those issues in a democratic manner. Which of the following statements would the CEO of QuickDrive most likely make?
A) The key to keeping talented employees loyal to QuickDrive is to use a participative management style and treat them with respect, value their ideas, give them the resources they need, and expect great things from them.
B) In a high-tech business, it is more important to invest in technology than to invest in people.
C) Spending a lot of money to buy out competitors for their technology is likely to backfire, because QuickDrive is a leader in technology development.
D) The key to QuickDrive staying on top in a high-tech industry is not wasting time checking out what other firms do, but to act immediately on my directives.
A) The key to keeping talented employees loyal to QuickDrive is to use a participative management style and treat them with respect, value their ideas, give them the resources they need, and expect great things from them.
When establishing criteria to measure the success of a customer-oriented business, managers should:
A) focus most of their attention on measures of employee satisfaction, since without good employees the firm will not be competitive.
B) limit their attention to financial measures such as profit and return on investment since these are the only objective and quantifiable measures available.
C) focus primarily on financial measures, but pay some attention to nonfinancial concerns.
D) recognize that, while financial measures are important and should be considered, the purpose of the firm is to satisfy both internal and external customers.
D) recognize that, while financial measures are important and should be considered, the purpose of the firm is to satisfy both internal and external customers.
As the marketing director for Chipper's Golf Resort, you are making plans for the annual golf tournament, and trying to decide on dollar prizes. After learning that in past years, you successfully raised in excess of$25,000 through registration fees and sponsorship, the general manager wants to make the top prize $10,000. His exact words were, "We can attract some great talent at that level!" At your morning meeting, you inquire: "Can we afford to announce a $10,000 prize at the expense of losing out on a portion of the registration fees if some of our past participants decide not to enter the tournament?" You explain to the general manager that if you set the prize too high, several better than average golfers in the area will find it to be "out of their league" and will be unmotivated to participate and spend the money. Your analysis of the situation is reasonable according to
A) Reinforcement Theory
B) Goal-Setting Theory
C) Expectancy Theory
D) Equity Theory
C) Expectancy Theory