Section One

Business and the environment

in which it operates
Multiple-choice and short questions
1 Working on resources to make a finished product that has a value that is more than the
value of the resources used is called
a
b
c
d

labour.
meeting needs.
adding value.
profit-making activity.

2 Match each type of business to its classification.

a
b
c
d
e
f

holiday company
fishery
chemical processing plant
forestry
supermarket
bicycle manufacturer

primary
secondary
tertiary

3 Country X has a total workforce of 20 million. Of these, 15% are employed in the tertiary
sector; 45% in the primary sector; and the remainder in the secondary. Calculate the
number of people working in the secondary sector.
4 Which of the following is a diversifying merger?
a
b
c
d

Horizontal merger
Vertical merger
Lateral merger
Conglomerate merger

5 Profit is a good measure of the size of a business.

a True
b False
6 Building new roads and hospitals increases the national wealth.
a True
b False
7 People who have an interest in the activities of a company are called

8 Stakeholders can increase their influence by acting in groups.

a True
b False

Section One Cambridge University Press 2010

9 Making a profit is one of the main objectives of organisations in the ____________ sector.
a public
b private
c non-profit-making
10 Selling goods on the internet is called ____________ .
11 One disadvantage of introducing new technology is
a employees may waste time on the internet.
b employees may need training.
12 A mixed economy is
a an economy which consists of both public and private sector organisations.
b an economy which produces both goods and services.
13 A multinational company is
a
b
c
d

a company that sells its products to other countries.

a company that employs people from different countries.
a company with operational bases in more than one country.
a company owned by people from more than one country.

14 The exchange rate of countries X and Y is 3 : 2. Calculate the cost in country Y of an item
costing $9 in country X.
15 Public sector organisations are owned by
a
b
c
d

(the government on behalf of ) members of the public.

shareholders.
local or national governments.
charities.

Section One Cambridge University Press 2010