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    CH 15- BUSINESS ORGANIZATION (ITS INTERNAL AND EXTERNAL ENVIRONMENT)

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    17 views8 pages

    CH 15 - Business Organization (Its Internal and External Environment)

    Uploaded by

    lorenz

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
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    CHAPTER 15 1ON: Its Internal and External Environment “ORGANIZATIC wiroament 4 recent purchased some stock ofa competitor as part of congas 0 0ST gegire the camper Hower it somewhat ter, Bene snark price of this stock could decease over the that oe pany could hedge against the posible decline ia the Be ooving wey 0 ee of ume peer ‘ics MES pay over common stock wih regard to carings ‘Pte el oer common tock Wh Tard asses fr Has proc ver é oes receive dividends in arrears before common stock Bes be Paid punters van edna of oly nang comparion tpoek fic, are greater than for debt ‘8 ssinaerp i ven up with respect tothe issuance of common stock, 3 Ormer re not tax dedueuble by the corporation wheres interest deductible 1 tepany has no firm obligation to pay dividends to commen Brendes + company sold a subsidiary to a group of managers of the “The purchasing group invested PI million and borrowed P49 ist the assets of the subsidiary. This is an example of a a ‘subsidiary salon ain pier 3. leveraged buyout © joint venture 5. figuidation ‘the acquisition of a retail shoe store by a shoe manufacturer is an example of ‘A vertical integration B econglomerate marict extension D. horizontal integration 361 10, 1. 12, A horizontal merger is ee ‘between Se ee Sorin ams aah rt ty Be Poconos i, f ceeesumnntinns a ‘Acoft drink producer acquiring botle menvcty A. horzontal merger 1890 can, B. vertical merger ty C. congenerie merger D. conglomerate merger A shoe manufacturing firm acquiring &brokenge house ian 8 any ‘A. horizontal merger B. vertical merger C. congeneric merger D. conglomerate merger Economic markets that are characterized by monop bhave elo the following characteriatic except” compete ‘A. one seller of the product B. advertising C. economies or diseconomies of scale D. heterogeneous products Which ype of economic market stricture is characterised by a sellers ‘of @ product or service, engaging, primary gt SEM competivon? stale honopely B. Perit competion © Otigopaty D. Monopotatic competition Which type of economie market structure fs composed ofa ag neni of erlore, each producing an identical product, and bth no Spun bamier to entry and exit? ‘2 Monopoly B Oligopoly €. efont competion . Monopole competition ‘A natural monopoly exists because ‘A. the firm owns natural resources B. the firms hold patents economic and technical conditions permit only one elficient supplier D. the government ia the only supplier 362 16 1. with many independent firms, low barriers to entry, and a market Mention is best classified ase) P02, competion B. oligaroly pugwing i iota iy sean of pact competent? hich of the 1 omogencous product Wa. Firms Sos are indifferent about which firm they buy from Noose Nm capa esl ie Indy oa é en ean price it product above the industy pie suing characteristic of oligopolitic marcet is ‘ofa homogeneous product with no close substitutes Ie a sale eter of a hetrogeneot product with no close subsites Ba singe strand exit barners in the industry Ee pterdependenceo rm ping and ouput eos reduction in economic activity wil be dipped by all of he flowing e10°Pt aged housing starts decrease pe quantity of unemployment caime 2B ineetom in te amount of ISry Purchases & SSerease in personal travel economists generally agree that business cycles are caused by changes ‘segregate expenditures resulting from technological changes, A pe et mo al 1 lee es eR A eco ion, a ee See ene ge dain of pk ening aii comets 2 Fa amy anes eft noe er = ee eed a ae we ema aig ean al ree eae bests maeeel a Spee ¢ een output p. Bach fi ine dissing ine dit ier © DB. 363 19, 20. 21 22, 23. 24. 25. Which type of economic market sry P. whsg Become matt arte oa, ‘ings ent atc sn rg B. Perfect competition arTiers tg C. Oligopoly a Monopolistic competition For Sr veo tn ca cen, serena puerta PS a a iisemass ‘in aggregate demand, = C. decrene® in 8geregate supply. i © races See SP creas noc Sm ee aes ee ein ta Teen pee B the necartagEPOMET of money eMac C. potential Cea zeraphoy lent will increase di ay oo ational income will exceed actual nats tramaticaly, al and eo a ach nd aor ca >nal income. Which one of the following would no domestic product (GDP}2 a ictotes too ‘allan A. Purchase of a new home, . 8. An automotive worker's wages © Aedoctor's fee D._Purehase of common stock When the addition to capital goods in an economy exceed consumption allowance, the economy has experienced et" rat ‘A. negative net investment. B. equilibrium investment positive grose investment. D. positive net investment. Economist and economic policy makers are interested effect because the multiplier explains why A. a simall chenge in investment can have @ much larger inpat ea ‘nthe moliper gross domestic product. B. consumption is always a multiple of savings. C. the money supply increases when deposits in the banking systes -D._ the velocity of money is less than one. ‘The most effective fiscal policy program to help reduce demand pul lation would be to ‘A. decrease the rate of growth of the money supply. B, increase both taxes and government spending 364 mt 3. increase government spending «xc tt wt tts Penman see en se Boring ROME ay ghich Deets those who are ented to 9 the ta of money. i ST name ni wooed. and fir cic amu Berg PNET Oy contracte that include the indexing of o ch is negatively related to the purchasin © payment ie price level, which regatively relat Br Tf peer of money: Per again reer 0 ene simultaneous OCCUTERES of 2 eon cana depron A Foing unemoloye ates and nsing unemployment rates, E increstine ion and a deepening recession. & doverestaila . level declines, real disposable income increases tk re secs, Tie phenomenon i known asthe Jing constant, an increase in income will normally, xe tn te demand fer OE. pcre the demand for mone B decea Mgecine in the money supply. ao porenae in the money SuppWy is fe folowing wil Increase the quantiy of money demanded by ital come fcrease in income. A Adee tne nominal interest rate B. An nerese in the supply of money. Ca eeer in the nominal interest rate. Which of the following factors would cause the demand for moncy to increase? Av Adectine in income. BY An increase in saving. G. Higher interest rates. D. An increase in income. 92, 33, 34, 35. ‘The demand for money will AA. increase if income increases but decreases increase, Srses if non B, increase when income and the nominal interet, decrease if income increases but increase it D. decrease if incqme increases but de Increase, ease cemina eb oma os rn, ‘The cost of holding money balances increases when ‘A. the purchasing power of money increases, B. the nominal interest rate increases. . the price level deciines. . the economy is not at full employment, When the interest rate is extremely high A. the opportunity cost of holding money is low. Be oportaniy cost of nding money hgh G. there is no cost to holding money because its pure rernains constant. NS Purchenng oy, D. the supply of money will be relatively small ‘An increase inthe money supply lads to: Av acdecline in interest rates, inveslment, aggregate expendi real income te expen, ey B, a decline in interest rates, and an increase in investnt ‘Aggregate expenditures and real income fee © ance nitro es, ivesimen eset pend D, an increase in interest rates, « decrease in investment, increase in aggregate expendities and real income, oonomists use the term “business cycle" to refer to: ‘A. the evolution of small business firms into large companies. BL changes in outpat which occurs because of technological changes, . fuctuations in aggregate real income above or below its lengx growth path. periods of price changes because of inflation or deflation ‘The type of unemployment caused by fluctuations in aggregate econore activity is “A. structural unemployment, B, nacural unemployment. C.. fictional unemployment. D. cyclical unemployment. 366 a 2 8 4 recession” to refer {0 erp cenomic tn tee ceal income . enn eno. Bete eo con gp cat nse a ast one mone Cc Saectine * Je at which real ODP is at its lowest-level a busitfarural GDP level is called the ot valve of assets desominated in foreign the make vas Spee echange rates hen ie a a ree unalfestd is referred 8 cou G jopting strategies to: to the act of adore ced with conducting transactions. _ associat ein fete uncer atc tat YOU expect fo increase erations in the market Or er ik eng fam Suc © Fane of a8 geconomie polis of goverment overac aaa .d the demand for a good increase, ‘the market price = oth the SuPPIY : = ase of an inelastic supply function. ast ofan inelastic supply function. soy tess fact, onl tc demand function. 1 sg only int fallen te he case ee Ase co a Se a ee operon i an : yu have determit A aie ems 0 ta Set and et fo ai ated or etree al verme ce oer Te a ined that the demand for your 367 4s, 46. 47. 49. 50. si. D. Sncreasing the price of your produee wan “ Which ‘one of the following has an = 7" Which ne invert retonsig ‘A. Aggregate income ~ -_ B Price levels * a Interest sates 5 Howoraas Which of te ow pees Product? B Aprice door © Aprice on DL Aperiect mates HO market features i Wey coun, “whe, Sethe sppraeae eye set B shite demand csmcfcjontcmmse teem ‘Demand fora product tends tobe price intastie ee = product is considered a nary item * ew good complements forthe produc are eva ©. the population in the market area is large fee . people epend a large share of ther ins on the product Which of the following has st price rhc of ig has the highest price elasticity cofcent? 8. Macaroni and cheese Cc Bread D. Sid boate ‘he ae vdeo str's business ineresed by 12% ater ee ew Taine’. pries fom FOG t0 P10. Thee, Wee fe admissions, videos are fe ae ie a ubwtate goods Super guce © Somplomentary goods 5. publ goods In any competitive market, an equal increase in both demand and se can be expected to always ‘A. increase both price and market-clesring quantity 368 ot s pie and mares easing UE deceit gh laring TAPES 5 eee s cause a shift in the supply curve of « product? solowing 20 of the product of the i ene price of wen in Oot guction taxes. Shane nce tax. is fn cone oy buyers in the marke nm yroducts, one of moses enh ad sf egos on can on of ine prot ee es goverment Bette ices for the product : ket for labor in which demand is stable, compet a ac ise their | = {al enaximmum wage below the equilibrium wage Peet ercme smaller foes aes mae Heme Spy must decrease S edie if workers curing rm tends, fom the societal viewpoint, to pall products (00 ow ce 09 ite OP Sete ice prota & et oo ttle equity Bnancing ent regulates 4 product or service in a competitive market sree gnerament regaryice below the equilibrium price, what fs the Bagman elec? Sires Kenora BA crease in demand §, Noetecton the market reason for the government to intervene in the wholesale electrical Aral rat ould include which one of the following? Pryce increase that fs more than expected. 2 RkCukigy is an essential resource and the wholesale market is not fompettre ¢ The cedtrciy distribution companies are losing money. 5, Foreign power generators have contracts with the local government at very high prices. 58. ot 62. If the income elasticity of demand coe 3.00, the goodie likely tes ~x a jowing are complementary goods except ter A Alueary good ae nortne owing B. A-complementary good * On, mated video cassettes ©. Aninferior good eR vl fim D. Anecessity cc. Cameras d razor blades © ers Which one of the following would ca diminishing marina lysates tat commodity to shift to the lef? See the demand oa go. TOE a aT atl’ wll decline aye consumer acute addon! units A Ase nthe pice of substitute product. fey Gta specific product 8." Anite in average household inchae Pa rey acne ws comme acquis ada nt Cc Arise in the price of a complement ic fuct D. Avisein the population, "PMR comma, oot ts cess aad ca ope pred Se’ wants will iinish withthe passage of tne eg © Germ Price celings ‘A. are illustrated by government price suy : Os cekaoegpee ye wey energie mapat re tiphaeroretid Seas pcs gener en cn PO ap a oe one and here tee oo ohr me the dei create prices below equilibrium prices D. result in persistent surpluses X and ¥ are substitute products. Ifthe price of immediate impact on product X is ‘Product Vince, gg ‘A. price will increase B. quantity demanded will increase C. quantity supplied will increase D. price, quantity demanded, and supply wil increase Ma goup of consumers dei to tnyot a parla p expected result would be Mar Prd, ty 12 'Sminernse inthe product price to make up lost rren B. A decrease in the demand for the product ? & ‘An inreaeem product spl Decne of ncensed salty D. That demand for he progct noid become completa Which ofthe fowing isnot Hety to ect the sappy «pri a 7 ly PP of ane FE Coange in gonement susie, 8 Shans in eciaegy & Change in conse income 3 Changs in odin cts Ha pods demend iceland tere a dcreasein pice edt creas in ta rene ‘hans ul rence ‘ecretein total revere andthe demand eure ‘an increase in total revenue : ia ote prep 370 69. 7. n ee a eee fic ‘Because of the existence of economies of scale, business fms may find at adatone! unit of bor ses fa than he previous uit A acai is added toa acto, ness aout wl dash c In the short run ercasing the size of factory wil result in lower average costs $ BSESSINg the sizeof factory wil result infer total costs tn the long run, a firm may experience increasing returns du fo 1h tao of diminishing retume 5. comparative advantage : opportunity costs D. economies of sale ‘The measurement of the benefit lst by using resources for a gen purpose is A eonomiceicioncy BL comparative advantage © opperunity costs By sbeolote advantage Marginal reve is ee fe Gaus even ssuaied wih incase es rete than pie in pre campeon am 72, 73, 74, 75. 16. D. the chan ee in tot one more ane E06 aseacaty \ vith would not be included in the calculation of the Jp microeconomics, the dist pone ofthe fol Re CARP sie that” SMS hing chang se Women er nome SUPPIY factors det aa fee gnly demand factors geen Pree A Rotor. worker's Wages ‘are ni letermine prec 5 Ase tomotive worker's wi D. all inpute sot towed to enter of Aa pase of comm ;PUIS are variable ‘exit the ind p. Pu nic activity is indicated by all of the following, except What is the spare i ousing starts ; TOS fee in tor tat deny oo BES 5 cuneate cen long-run cost fur > °S the » jction in a Nothing, the two func” Short cy Breet in pereonil {AVE purchases &,_ The level of technology * a identicat Fagg ingegon in the amount 5, Ghanees in government eu . following may provide a leading indicator of @ future ‘The nature of the costa, *>sidies wri of te omestic Product? 0. ae in FORE ene money SUPPLY Seta reduction. oe Saance of building permits Weonsumer ‘Confidence falls, the ipa 1 decrees nthe timeliness of devery by vendore eas a downta ct Upon thee B aineroate in. Sctenee ours worked per wee of production Ban ‘peu Sono ig © fp incre no change workers D. consumer confidence doe come is calculated a "does not have an impact upon the ‘x, Disposable incert "product minus the capital cost allowance During the eineny 2 por Pract minus indirect business taxes plus net income A te pe rTecessionary phase of business cycle Her domestic produ Bo the natural rae of ne 1 Wel 0 chine ey income nus tranafer payments en snnemployment wil ine persona come minus personal taxes Selene cet oct ety 5 peal een ‘onal income will exceed potential nagona] neo se primary reason for allowing legal immigration into industal navons Fora given level of tax collections, ga, The poimerants’ potential for collectior res, and interest rates, a = leficit pitta gen er a le ut increase in aggregate demand B iling «trade agreement 3 Sere aero meet Se 5 increase ‘in aggregate supply oe lecrease in aggregate supply fo. some economic indicators lead the economy into a recovery or recession, In SeTScme igi An example ofa lagging indicator ig Jn national income terms, aggregate demand isthe ironic unemployment A. demand for money bythe commonly ina period ofl expoyme fh Shaers for consurner and producer goods BL total expenditure on capital gods by enteprencute dake res © oasing starts offal employment D consumer expectations ©. demand that is needed if a country’s economy is to opente t d optimum level and the level of investment is to be raised 4, Government borrowing to findnce large deficits increases the demand for D. total expenditures on consumer goods and invesinnt, ichng ‘government and foreign expenditures, during a given period 372 Jendable fands and ‘A increases the supply of lendable funds B. exerts downveard pressure on interest rates CC. has no impact on interests 373 apie 85. A period of ris - So AS inc "es cE es & hen gamete" on . Wil men POW of money "P between OM ice a °c ted by ‘contracts that ‘nchige Sy : ae the price level, . ‘*SINE Power of money’ i Neate rea ‘ ee all an open peaPY 8 & nation’s zh ences mar} ‘Purchases by the ns tion’s ee : S.dcerease in the discoun mie son conta met & saktess te dicantne _ heen fees aa sng total pty ene er ey Et oe Sores at a ge ae & Rec elaant tte

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