When large suppliers or buyers are involved, a workflow system:

Question 1
Wal-Mart and Levi Strauss collaborate on demand forecasting in order to optimize the flow of materials along the supply chain. This is an example of:
A. reducing design cycle time.
C. reducing product development time.

Question 2
__________ is a business strategy that enables manufacturers to control and share product-related data as part of product design and development efforts.
A. Advanced planning and scheduling
B. Collaborative planning
C. Product lifecycle management
D. Internal commerce

Question 3
When large suppliers or buyers are involved, a workflow system:
A. is needed for both the collaborative efforts and for supply chain and production improvements.
B. is needed for collaborative efforts only.
C. may be helpful for supply chain improvements.
D. will fail because of system incompatibilities.

Question 4
Groupware is appropriate in all of the following situations EXCEPT:
A. for groups to share ideas and opinions.
B. for people working on different tasks or projects.
C. for networked environments.
D. for people in the same room.

Question 1
Cyber cons have a negative effect on EC because:
A. defending against these cons and compensating for damages significantly increase the costs of EC.
B. a majority of potential customers do not shop online because they are too afraid of fraud to trust online merchants.
C. companies cannot expand their e-business to other countries with underdeveloped legal systems.
D. con artists have gone low-tech.

Question 2
The key reasons why EC criminals cannot be stopped include each of the following EXCEPT:
A. strong EC security makes online shopping inconvenient and demanding on customers.
B. sophisticated hackers use browsers to crack into Web sites.
C. lack of cooperation from credit card issuers and foreign ISPs.
D. online shoppers do not take necessary precautions to avoid becoming a victim.

Question 3
The protection of information systems against unauthorized access to or modification of information that is stored, processed, or being sent over a network is referred to as:
A. information assurance.
B. information defense.
C. information security triad.
D. information integrity.

Question 1
Social engineering attacks:
A. are an example of technical attacks requiring software or systems knowledge.
B. are a combination of technical and nontechnical attacks.
C. take advantage of Web 2.0 applications like social networking sites, blogs, wikis and RSS feeds.
D. are no longer considered to be serious Internet threats due to the increased security of MySpace, LinkedIn, and YouTube.

Question 2
A botnet is:
A. a piece of code in a worm that spreads rapidly and exploits some known vulnerability.
B. a piece of software code that inserts itself into a host or operating system to launch DOS attacks.
C. DOS attacks.
D. a collection of a few hundreds of thousands of hijacked Internet computers that have been set up to forward traffic, including spam and viruses, to other computers on the Internet.

Question 3
Access to a network ought to be based on:
A. the policy of least privilege where access to network resources are blocked and permitted only when needed to conduct business.
B. the policy of acceptable use where access is restricted by the firewall.
C. role-specific security protocols where access is limited by a user’s level of trust.
D. the policy of need-to-know where access by all non-employees is blocked.

Question 4
The advantages of virtual private networks (VPN) for data communications include all of the following EXCEPT:
A. they are less expensive than private leased lines because they use the public Internet to carry information.
B. they ensure the confidentiality and integrity of the data transmitted over the Internet without requiring encyption.
C. they can reduce communication costs dramatically because VPN equipment is cheaper than other remote solutions.
D. remote users can use broadband connections rather than make long distance calls to access an organization’s private network.

Question 1
The basic security concepts relating to customers and other users are:
A. confidentiality, integrity, and availability.
B. information assurance, confidentiality, and authentication.
C. authentication, authorization, and nonrepudiation.
D. authorization, nonrepudiation, and information assurance.

Question 2
A vulnerability:
A. is a software bug.
B. is the probability that a weakness will be known and used.
C. is the estimated cost, loss, or damage that can result if a threat exploits a vulnerability.
D. is a weakness in software or other mechanisms that a hacker can use directly to gain access to a system or network.

Question 3
__________ is a crime ware technique used to steal the identity of target companies to get the identities of their customers.
A. Spamming
B. Pretexting
C. Social engineering
D. Phishing

Question 1
Brand building is important in B2B exchanges because:
A. exchange members typically buy only the best brands of product.
B. information flow is poor in most exchanges, making trust of suppliers very important.
C. it is easy for exchange members to change to another exchange.
D. exchange members typically buy products at the lowest cost unless branded.

Question 2
A company’s internal operations and its relationships with suppliers and other business partners are frequently:
A. as complex as customer-facing applications such as taking an order online.
B. much more complex than customer-facing applications such as taking an order online.
C. much less complex than customer-facing applications such as taking an order online.
D. replaced by customer-facing applications.


Question 3
For a manufacturer, the supply chain ends when the:
A. supplier delivers raw materials and component parts to the manufacturer.
B. customer buys the product.
C. product is used up and disposed of.
D. customer decides he/she is satisfied with a product.

Markets in which several large sellers sell to a large number of buyers are called: 

Question 1
A company-based acquisition site that uses e-procurement methods such as reverse auctions, negotiations, or group purchasing to overcome the manual searching of e-stores and e-malls, is referred to as a(n):
A. desktop procurement method.
B. buy-side e-marketplace.
C. intermediary.
D. aggregated catalog.

Question 2
Benefits of e-procurement over traditional procurement methods include all of the following EXCEPT:
A. increasing the productivity of purchasing agents.
B. lowering purchase prices through product standardization, reverse auctions, volume discounts, and consolidation of purchases.
C. increasing the skill requirements and training needs of purchasing agents.
D. streamlining invoice reconciliation and dispute resolution.

Question 3
In general, the benefits of contract-management software include all of the following EXCEPT:
A. reducing contract negotiation time and efforts.
B. reducing contract-related risks
C. providing more efficient approval processes.
D. enabling standardization of contracts throughout the enterprise.

Question 1
Attracting large business sellers to public exchanges is often difficult for all of the following reasons EXCEPT:
A. they are required to pay transaction fees even when they engage in transactions with existing customers.
B. it is sometimes difficult to recruit large suppliers.
C. competitors who are also exchange members may gain access to confidential information.
D. advertising costs in public exchanges are very expensive.

Question 2
In dealing with exchange members, the management of the exchange should:
A. strive to maximize exchange revenues through charging the highest possible fees.
B. leave the management of day-to-day operations of the exchange to the members.
C. make certain that the exchange is neutral in its dealings with all members.

D. take special care of the companies that share ownership in the exchange.

Question 3
Using tunneling technology to improve security of communication over the Internet is called:
A. electronic data interchange (EDI).
B. virtual private network (VPN).
C. Internet protocol (IP).
D. local area network (LAN).

Question 1
All of the following are correct about market research methods EXCEPT:
A. it is important first to understand how groups of consumers are classified or segmented.
B. markets can be segmented to increase the percentage of responses and to formulate effective marketing strategies that appeal to specific consumer groups.
C. direct mail marketing methods are usually cost-effective.
D. market segmentation is done with the aid of tools such as data modeling and data warehousing.

Question 2
The major disadvantage of banners is:
A. the limited amount of information can be placed on the banner.
B. their cost.
C. viewers have become immune to banners and seldom notice them.
D. the limited amount of time the banner is present to the visitor.

Question 3
A(n) __________ is a type of pop-up ad that appears after a user clicks a link and remains while content is loading to capture the user’s attention for a short time, either as a promotion or a lead-in to the site’s homepage or to advertise a product or a service.
A. keyword banner
C. banner exchange
D. interstitial

Question 4
A(n) __________ is an HTML coding statement that describes the content of a Web page and is used by search engines to index the site’s content so that it can be found.
A. domainer
B. meta-tag
C. associated ad display
D. advertorial

Question 1
Key business drivers for B2B are all of the following EXCEPT:
A. numerous private and public B2B e-marketplaces.
B. the availability of a secure broadband Internet platform.
C. the willingness of companies to incur higher costs to improve collaboration.
D. the need for collaboration between suppliers and buyers.

Question 2
B2B transactions that involve communication, design, planning, information sharing, and activites beyond financial transactions among business partners is referred to as __________.
A. exchanges
B. collaborative commerce
C. trading communities
D. public marketplaces

Question 3
With __________, a business sells to a business but delivers small quantities to customers of the buying business.
A. B2B2C
B. B2B
C. B2C2B
D. B2C

Question 1
A third party that operates an exchange and, in many cases, also owns the exchange is known as a(n):
A. intermediary.
B. market maker.
C. negotiator.
D. agent.

Question 2
ChemConnect is an example of a successful e-exchange with:
A. many buyers and many sellers.
B. few buyers and few sellers.
C. many buyers and one seller.
D. many buyers and few sellers.

Question 3
In the context of EC, __________ are electronic trading-community meeting places for many sellers and many buyers, and possibly for other business partners.
A. exchanges
B. portals
C. social networks
D. B2C


Question 4
Markets in which several large sellers sell to a large number of buyers are called:
A. differentiated markets.
B. fragmented markets.
C. buyer-concentrated markets.
D. seller-concentrated markets.

What if a salary is deemed unreasonable by the IRS what happens then?

Question 1
According to the EC consumer behavior model, personal characteristics and environmental characteristics are classified as:
A. independent variables.
B. dependent variables.
C. intervening variables.
D. decision variables.

Question 2
The major environmental variables influencing EC purchasing are:
A. price, brand, frequency of purchase, and tangibility.
B. social, cultural, community, regulatory, political, and legal.
C. age, gender, ethnicity, education, and lifestyle.
D. price, social, cultural, ethnicity, and lifestyle.

Question 3
Banner advertising on Web sites helps trigger a realization that there is a gap between reality and a desired state, which occurs in the __________ stage of the EC purchase decision-making process.
A. need identification
B. information search
C. evaluation, negotiation, and selection
D. purchase, payment, and delivery

1. (TCO 6) The unearned premium reserve: (Points : 3)
usually increases when premium volume of an insurer is decreasing.
is a special group of assets reserved for catastrophe losses.
consists primarily of cash and liquid near-cash investments.
is a deferred income account carried on the balance sheet as a liability.
none of the above.

2. (TCO 6) Basically, a retrospectively rated insurance program is a: (Points : 3)
form of class rating.
variation of schedule rating.
cost-plus arrangement in which actual losses determine the final premium.
a variation of experience rating, since past losses determine the current premium.
none of the above.

3. (TCO 6) Major differences between statutory accounting and Generally Accepted Accounting Principles (GAAP) include: (Points : 3)
the concept of non admitted assets.
the way that the insurer’s invested assets are valued.
the matching of expenses and revenues.
the degree of conservatism.
all of the above.

1. What are the half-year and mid-quarter conventions?

2. What if a salary is deemed unreasonable by the IRS what happens then?

1. (TCO 7) If an agent tells an insured that a breach of a policy condition will not affect the coverage, and a loss occurs, the insurer may: (Points : 3)
deny coverage if the breach contributed to the loss.
be liable for the loss because the agent’s acts are considered acts of the insurer.
deny liability if the agent was not authorized to make such statements.
deny liability because a waiver must be in writing before it is valid.
none of the above.

2. (TCO 7) Because of the fact that the terms of an insurance contract are fixed by the insurer instead of being determined by a bargaining process, the insurance policy is said to be: (Points : 3)
a contract of utmost good faith.
an aleatory contract.
a contract of indemnity.
a unilateral contract.
a contract of adhesion.

3. (TCO 6) Major differences between statutory accounting and Generally Accepted Accounting Principles (GAAP) include: (Points : 3)
the concept of nonadmitted assets.
the way that the insurer’s invested assets are valued.
the matching of expenses and revenues.
the degree of conservatism.
all of the above.

Question 1
In general, what has been the impact of the introduction of EC on customer loyalty?
A. Loyalty has increased because of targeted relationship marketing.
B. Loyalty has decreased because of customers’ ability to shop, compare, and shift vendors.
C. There has been little change in loyalty because the impacts have cancelled each other out.
D. It is not known whether loyalty has increased or decreased.

Question 2
By increasing customer loyalty, EC companies can achieve each of the following benefits

A. lower marketing and advertising costs.
B. lower warranty claims costs.
C. lower resistance to competitors.
D. lower transaction costs.


Question 3
Procter & Gamble (P&G) used the Internet in the new product development of Whitestrips, a teeth-brightening product. Based on this experience, P&G:
A. decided to add Internet research to its traditional marketing test model.
B. learned that the cost of online surveys were about the same as similarly sized telephone surveys, but online surveys expedited research considerably.
C. could not determine the target market segments for the Whitestrips.
D. reduced the time-to-market from concept to market launch by approximately two years.

Which of the following is not one of the four primary functional areas of a firm?

1. Operations management is concerned with
the design of the firm’s productive systems.
the operation of the firm’s productive systems.
the improvement of the firm’s productive systems.
all of the above.

2. Which of the following is not one of the four primary functional areas of a firm?
human resources.

3. The production system that prizes flexibility over efficiency and quality over quantity is known as
mass production.
craft production.
lean production.
electronic commerce.

Question 1
All of the following are examples of interactive entertainment EXCEPT:
A. Internet gaming.
B. purchasing theatre tickets online.
C. adult sites.
D. fantasy sports games.

Question 2
__________ are gateways to storefronts and e-malls.
A. Shopping portals
B. Shopbots
C. Shopping browsers
D. Intelligent search engines

Question 3
Charles wants to buy a John Lennon lithograph over the Internet, but he is unwilling to pay for it until he inspects it to ascertain authenticity. The auction site through which he purchases the painting agrees to hold his money until he tells them to release it to the seller. This is an example of:
A. a trustmark.
B. an escrow service.

C. a warranty.
D. a verification.


Question 4
A software agent that surveys users’ reading interests, then uses machine learning to find new Web pages and news articles using neural-network-based collaborative filtering technology is called:
A. an aggregator portal.
B. a real-time agent.
C. a learning agent.
D. the sponsorship model.

1. The ratio of a firm’s monthly output to the number of labor hours used in the same month would be a measure of
labor productivity. 
capital productivity.
machine productivity.
multifactor productivity.

2. All of the following are responsibilities of operations managers except
acquiring financial resources. 
managing inventories.
planning production.
scheduling production.

3. All of the following are transformation processes except:

Question 1
Amazon.com experienced all of the following EXCEPT:
A. Amazon.com maintained its position as the number one e-tailer in 2006.
B. Amazon.com has trended upward, driven largely by product diversification and its international presence.
C. The company’s financial success has been assured.
D. Despite increasing a sales and net profits, in percentage terms, Amazon has seen a drop in profitability in 2006, attributed to huge spending on further developing its technology infrastructure and its investment in the Amazon Prime discount shipping program.

Question 2
According to data from marketer, approximately __________ shop online and/or research offline-sales online.
A. two in five Internet users age 18 and over
B. three in four Internet users age 14 and over
C. three in four Internet users age 25 and over
D. two in five Internet users age 30 and over


Question 3
Marketing that takes place without the help of intermediaries is called:
A. direct marketing.
B. disintermediation.
C. pure-play e-tailing.
D. e-malls.

How are these colors appropriate to the subject matter?

1. Picasso’s painting, Guernica, about the tragedies of the Spanish Civil War, uses only black, grey, and white colors. How are these colors appropriate to the subject matter?

2. Compare Leonardo da Vinci’s Annunciation with the Peter Paul Rubens painting of the same subject. Which painting has more drama and why?

1. According to ethical relativism,
There are no moral standards which are universally true.
Morality is societal-based.
Different societies have different views as to what is right and wrong.
All are true.

2. Which of the following is not an accurate statement?
The fact that there are differences among societies in moral positions means logically that there are no, and can never be, any moral standards or rules.
The doctrine of legal positivism would maintain that a business person rely on the law as a basis for decision-making when confronted with a moral question.
According to the Hobbesian view of legal positivism, there can be no such thing as a bad, immoral, or unjust law.
According to Bentham, Utilitarianism is an objective, scientific, mathematical, and empirical ethical theory.

3. Adam is a Legal Positivist Adam  believes that
the law should be applied the same in all cases in all circumstances.
the law should re­flect universal principles that are part of hu­man nature.
the law should not follow decisions made in past cases.
the written law of a society at a particular time is the most significant standard of morality.

1. Fran, an executive with Global Sales Corporation, has to decide whether to market a useful product that nonetheless might have undesirable side-effects for a small number of users. What ethical theory would the Sophists advise her to use so that her firm can morally market the product?
Kantian ethics
Corporate Social Responsibility
Last Resort theory.

2. The moral theory of ethical relativism can best be characterized by:
The consultation of an outside source, such as a book or person, for guidance.
The belief that the moral rules should be determined by persons who have a “veil of ignorance” about their place or station in society.
The belief that a person must decide what course of action is moral based on what a society believes is proper and right.
Determining which course of action produces the greatest amount of good for the greatest number of people.


1. Operations management is concerned only with the day-to-day operations of the firm’s productive system.


2. Operations managers need an integrated view of business organizations.


3. The concept of interchangeable parts was introduced by Frederick W. Taylor.


4. Operations is the function or system that transforms inputs into outputs of greater value.


Question 1
Which of the following is achieved through formulation and enforcement of policies, rules, and regulations?
A. Division of labor
B. Centralized decision making
C. A common goal
D. Coordination of effort

Question 2
Historically, managers have maintained the integrity of the hierarchy of authority by adhering to:
A. centralized decision making.
B. a wide span on control.  C. decentralized decision making.
D. the unity of command principle.

Question 3
The __________ refers to the number of people reporting directly to a given manager.
A. division of labor
B. hierarchy of authority
C. span of control
D. unity of command

Question 4
A relatively self-sufficient entity is called a(n):
A. open system.
B. unity of command system.


C. closed system.
D. command-and-control system.

Which of the following is the dominant country of the Central Asian subregion?

1. Serbian nationalists adopted which of the following terms to rationalize their actions during the war in Bosnia-Herzegovina?
A. Ethnic diversity
B. Depopulation
C. Holocaust
D. Ethnic cleansing

2. Which of the following is the dominant country of the Central Asian subregion?
A. Kyrgyzstan
B. Uzbekistan
C. Turkmenistan
D. Tajikistan

3. Nationalism is to pride in one’s national identity as a _______ is to a group of people who share a common identity, a sense of unity, and a desire for self-government.
A. state
B. nation
C. country
D. region

1. In 2005, which two European groups rejected an EU treaty that would have provided for an EU constitution?
A. The Germans and the Dutch
B. The French and the Dutch
C. The Danes and the Irish
D. The French and the Irish

2. Which of the following is the only global city in the region of Russia and its neighboring countries?
A. St. Petersburg
B. Moscow
C. Kiev
D. Tashkent

3. In Russia, which of the following occurred after the global financial crisis in 1998?
A. The Russian ruble declined in value against the dollar by about 12 percent.
B. Large areas of farmland were bought back from foreign investors.
C. Russia became a major exporter of grain after 2001.
D. Russian farmers abandoned their farms in large numbers.

1. The steppes of southern Russia, the African veldt, and the pampas of Argentina are good examples of _______ biomes.
A. tundra
B. grassland
C. desert
D. forest

2. Which of the follow is a Slavic language?
A. Romanian
B. Polish
C. Gaelic
D. Flemish

3. The concept of the _______ of distance is illustrated by the fact that as cost increases with distance, interactions between people decrease.
A. flexibility
B. friction
C. relativity
D. erosion

1. In Russia, which of the following occurred after the global financial crisis in 1998?
A. The Russian ruble declined in value against the dollar by about 12 percent.
B. Large areas of farmland were bought back from foreign investors.
C. Russia became a major exporter of grain after 2001.
D. Russian farmers abandoned their farms in large numbers.

2. The Soviet policy of democratic centralism maintained that
A. the Communist Party represented the working people and, therefore, was the only party with the right to govern.
B. the state, not free-market consumers, should decide what needed to be produced.

C. the state owned all businesses for the good of the people.
D. capitalists used their riches to manipulate governments to serve their interests.

3. Upon the fall of Constantinople to the Ottoman Empire in 1453, _______ was seen as the true inheritor of the Christian realm.
A. Peter the Great
B. Mikhail Romanov
C. Ivan III (The Great)
D. Catherine the Great

1. Not being socially responsible most likely subjects one and one’s company to:
Civil legal liability based on the principle of Last Resort.
Criminal legal liability based on the principle of Nonfeasance.
Moral condemnation for the failure to rescue the poor in the local community.
Criticism in the local community for not being a “good corporate citizen”


2. Happy Feet manufactures shoes in Country Y for sale in the United States. Happy Feet’s president discovers that the Country Y workers’ average age is sixteen and that they work on average of 13.2 hours per day in a 90 degree warehouse with insufficient safety precautions, all of which practices are legal in Country Y. The president of Happy Feet decides to improve the working hours and conditions of the company’s workforce, even though these actions will be more expensive for the company. The president’s decision is best described as
Lawful profit maximization
Moral profit-making
Illegal since the shareholders of Happy Feet might be harmed
Social Darwinism

Atmosphere-ocean environments related to climate are produced by interactions of which of the following?

1. Regarding the eastern Slavs, which of the following statements is false?
A. Under Polish, Austrian, and Lithuanian influences, the people of Belarus and Ukraine adopted national identities that distinguished them from Russians.
B. Ukraine has expressed interest in reuniting with the Russian Federation.
C. The word Ukraine means “borderland.”
D. The word Belarussian means “white Russians.”

2. As of the year 2009, how many people around the globe lived outside their country of birth?
A. 200 million
B. 100 million
C. 50 million
D. 700 million

3. Following the breakup of the Soviet Union, 15 of its former republics became independent. Twelve of these former republics formed the Commonwealth of Independent States, largely in recognition of
A. the threat posed by NATO.
B. the economic threat posed by the European Union.
C. the need to sustain the trade flows established during Soviet times.
D. common cultural ties.

1. Jones, this seminar was the best course I have had. I wondered if we could discuss my grades?
Appeal to pride
Appeal to pity
Ad hominem
Red herring

2. John has really worked hard on his term project, and he will really be depressed if he does not make an A. For these reasons, you just have to give him an A on his project.
Appeal to pride
Appeal to pity
Ad hominem
Red herring


3. Gay and lesbian groups have argued in favor of legislation to prevent their people from being discriminated against. But we must remember that a genetic basis for homosexuality has yet to be discovered. Granted, some studies indicate that homosexuality has a biological origin, but these studies are too limited to be conclusive. Thus, the safest policy right now is to take no action at all on these questions.
Appeal to fear
Slippery Slope
Red herring
Tu quoque

1. If you are opposed to the North American Free Trade Agreement, you are obviously opposed to free trade.
Appeal to pity
Straw man
Ad hominem

2. If we make an exception for you, then we’ll have to make an exception for everyone.
Appeal to fear
Slippery Slope

Red herring
Tu quoque


3. This administration is not anti-German, as it has been alleged. Germany is a great country. It has contributed immensely to the world’s artistic treasury. Goethe and Schiller made magnificent contributions to literature, and Bach, Beethoven, Wagner, and Brahms did the same in music.
Red herring
Ad hominem
Appeal to pride
Ignoring the question

1. University of Chicago Professor Milton Friedman famously said about social responsibility:
The social responsibility of business is to make money legally.
Big multinational corporations must solve all the social problems in the world.
Business is immoral for not helping out in the community.
When in Rome, do as the Romans.

2. The term “corporate social responsibility” is today best defined in the U.S. by:
a. Federal statutory incorporation law.
b. Securities and Exchange Commission (SEC) Rule 10b(5)
c. Kant’s ethical writings condemning the corporate form of business for being selfish, greedy, and immoral
d. Current definitions in business of the term which indicate that a company should be socially responsible and thus contribute to charities and civic organizations, but in a prudent and smart manner.

3. Which of the following statements is incorrect?
Basing one’s behavior on the adage, “Do unto others as you would have them do unto you,” is part of Kantian ethics.
An ethical theory that says each person is presumed to have entered into an agreement with all others in society to obey moral rules that are necessary for people to live in peace and harmony is called Social Contract ethics.
A doctrine that says that a corporation should consider its presence in the community and society and the effects its actions have on persons or groups other than the shareholders is called Corporate Social Responsibility.

A theory of social responsibility that says that business must solve global problems such as poverty and disease is called Legal Nonfeasance.

4. All of the following are basic social responsibility principles EXCEPT:
The responsibility of business beyond shareholders to stakeholders
The responsibility of business to maximize profits in order to do the most moral good for the shareholders
Respect for the environment
Becoming engaged and involved in civic and charitable activities.


1. The position of a place north or south of the equator is measured in
A. meridians of latitude.
B. degrees of latitude.
C. terms proportional distance.
D. terms of relative location.

2. Atmosphere-ocean environments related to climate are produced by interactions of which of the following?
A. The lithosphere and hydrosphere
B. Tectonic plate interactions with the lithosphere and hydrosphere
C. The atmosphere, meteorology, and volcanic sub zero temperatures.
D. The atmosphere and hydrosphere


3. In general, the most materially advanced and developed countries are focused on extensive development of the _______ sector of their economy.
A. secondary
B. tertiary
C. quaternary
D. primary

If a firm has no operating leverage and no financial leverage, then a 10% increase in sales will have what effect on EPS?

1. If a firm has no operating leverage and no financial leverage, then a 10% increase in sales will have what effect on EPS?
A EPS will remain the same
B EPS will increase by 10%
C EPS will decrease by 10%
D EPS will increase by less than 10%

2. A firm’s optimal capital structure occurs where?
A EPS are maximized, and WACC is minimized.
B Stock price is maximized, and EPS are maximized.
C Stock price is maximized, and WACC is maximized.
D WACC is minimized, and stock price is maximized.

3. Which of the following will result from a stock repurchase?
A Earnings per share will rise.
B Number of shares will increase.
C Corporate cash is conserved.
D Ownership is diluted.

4. The final approval of a dividend payment comes from
A the controller.
B the president of the company.
C the board of directors.
D It is a joint decision requiring approval from all of the above.


1. I know you are folks are patriotic god-loving citizens, just like me, but my opponent is not. How can you vote for him when he doesn’t support the same values that we cherish?
Appeal to pride
Appeal to pity
Ad hominem
Red herring


2. You are all intelligent people, so you should be able to see the fallacy in his statement.
Appeal to pride
Appeal to pity

Ad hominem
Red herring


3. Humanitarian groups have argued in favor of housing for the poor. Apparently what they want is another high-density project. Unfortunately, these projects have been tried in the past and have failed. In no time they turn into ghettos with astronomical rates of crime and delinquency. Chicago’s Cabrini-Green is a prime example. Clearly, these humanitarian arguments are not what they seem.
Appeal to pity
Straw man
Ad hominem

1. If students play video games, their school work will suffer, and they will not have the ability to succeed in life, ending up in lower paying jobs and needing government programs, which will increase our taxes. So video games will increase our taxes.
Appeal to fear
Slippery Slope
Red herring
Tu quoque

2. Child to parent: Your argument that I should stop stealing candy from the corner store is no good. You told me yourself just a week ago that you, too, stole candy when you were a kid.
Appeal to fear
Tu quoque
Ad hominem
Red herring

3. Officer, How can you ticket me for speeding, when I see cops speeding all the time?
Appeal to fear
Slippery Slope
Red herring
Tu quoque


Your earned value analysis calculates, “The PV was $240, the EV is $230, and the AC is $250, so we have a CV of $-20 and an SV of -$10.” What does this information tell you about this project? What else might you need to know? Explain this as though you were presenting to someone who does not understand the earned value terminology.

1. Interviewer: “Senator, you voted for the B-1 bomber. Would you explain your reasons, particularly in light of criticisms about the effectiveness of the plane?”
Senator: “I’d be glad to. America needs a strong defense. We’d all like to live in peace with the other nations of this world, but we deceive ourselves if we think we can do that without being prepared to defend ourselves and our allies, our rights and our interests. It’s a dangerous world out there, and I’d be derelict in my duty to the people of this nation if I allowed us to lie down and cry ‘Uncle.”‘
Red herring
Ad hominem
Appeal to pride
Ignoring the question

2. Officer, please excuse my going over the speed limit, but my mother is ill and I’m being audited by the IRS, and I don’t know how I can meet all my bills.
Appeal to pride
Appeal to pity
Ad hominem
Red herring


3. There is a good deal of talk these days about the need to eliminate pesticides from our fruits and vegetables. But many of these foods are essential to our health. Carrots are an excellent source of vitamin A, broccoli is rich in iron, and oranges and grapefruits have lots of vitamin C.
Appeal to fear
Tu quoque
Ad hominem
Red herring

Which of the following is not an example of ethical egoism? 

1. The statement that “the good is that at which all things aim” is by
A. Plato.
B. Locke.
C. Aristotle.
D. Hobbes.

2. Virtue Ethics helps us determine
A. Whether an action is moral.
B. Whether a form of ethical reasoning is virtuous.
C. How to calculate between consequential and non consequential reasoning.
D. How we ought to be.

3. Which of the following is not an example of ethical egoism?
A. We should treat others well because we want to be treated well in return.
B. We should treat others well so they will treat others well.
C. We should work hard because a “job well done is its own reward.”
D. We should work hard because doing so is a good model for our children.

1. The break-even point is equal to (Points : 1)
A fixed costs divided by (sales price per unit — variable cost per unit).
B fixed costs divided by unit variable costs.
C fixed costs divided by selling price per unit.
D (sales price per unit — variable cost per unit) times the fixed costs.

2. The payment of dividends may indirectly result in closer monitoring of management’s investment activities, thus increasing shareholder value by (Points : 1)
A reducing agency costs.
B increasing information asymmetry.
C increasing a company’s amount of free cash flow.
D reducing auditing fees.

3. A firm that uses large amounts of debt financing in an industry characterized by a high degree of business risk would have ________ earnings per share fluctuations resulting from changes in levels of sales. (Points : 1)
A no
B constant

C large
D small

Question 1

A business that is concerned solely with the financial implications of lawful alternative courses of actions is likely applying which value to business?
Moral and ethical
Maximizing profits lawfully
Satisfying stakeholder interests
Social responsibility.

Question 2
A few years ago, a large clothing manufacturer decided that it had to close its last operating manufacturing facilities in the United States and locate the production to plants located in countries with low labor costs. The manufacturer provided the workers who lost their jobs with a much larger severance package than was required by their employment contracts and by statute. This caused considerable expense to the company. In making this decision, which of the following is true about how the company must have viewed the relative importance of the theories of business values discussed in the text?
Profit maximization was equal in importance to corporate social responsibility.
Corporate social responsibility was more important than profit maximization.
Profit maximization was more important than Utilitarian ethics.
The company did not believe in the value of legality.

Question 3
Which statement is correct regarding the application of the term “social responsibility” to business?
One social responsibility dilemma faced by corporate management at times is the proper nature and extent of a company’s social responsibility activities in the community.
Most state legislatures in the U.S. have now compelled corporations to adopt detailed social responsibility codes.
Social responsibility is equivalent to Kant’s Categorical Imperative ethical principle.
Under social responsibility analysis, the shareholder stakeholder group is paramount and absolute and the sole focus of any value analysis.

Question 4
Being socially responsible legally requires a company to adhere to:
Kantian ethics
Moral Saint status
Business Hero status
None of the above.

1. Which of the following was not one of the founders of utilitarianism?
A. James Mill
B. Jeremy Bentham
C. John Stuart Mill
D. Rene Descartes

2. According to utilitarianism which of the following is useful for evaluating the morality of an action?
A. People’s intentions
B. The nature of the act
C. The process of accomplishing the result
D. The result

3. Which of the following is not necessary to act morally according to utilitarianism?
A. To consider all the variables involved in an action.
B. To act as the majority wishes.
C. To consider all people to be of equal value.
D. To produce a result that produces the greatest good for the greatest number.


1. Sweet Tooth Bakery bakes and sells pies. Sweet Tooth has annual fixed costs of $880,000 and a variable cost per pie of $7.50. Each pie sells for $15.50 each. The firm expects to sell 500,000 pies annually. What is the break-even point in sales dollars? (Points : 1)
A $3,100,000
B $2,875,000
C $1,705,000
D $1,625,000

2. Amish Enterprises makes wooden play sets. The company pays annual rent of $400,000 per year and pays administrative salaries totaling $150,000 per year. Each play set requires $400 of wood, ten hours of labor at $70 per hour, and variable overhead costs of $100. Fixed advertising expenses equal $100,000 per year. Each play set sells for $3,200. What is Amish Enterprises’ break-even output level? (Points : 1)
A 340 play sets
B 325 play sets
C 297 play sets
D 258 play sets

3. How frequently do corporations generally pay dividends? (Points : 1)
A Annually
B Semi-annually
C Quarterly
D Monthly

Which of the following power technologies has the highest fuel (thermal) efficiency?

Question 1
The world’s first large-scale nuclear power plant began operations in:
A. 1947.
B. 1957.
C. 1967.
D. 1977.

Question 2
Which of the following power technologies has the highest fuel (thermal) efficiency?
A. Fuel cell
B. Steam electric power plant
C. Nuclear electric power
D. Gas turbine electric power plant

Question 3
According to Michael Renner, the main objective of the war in Iraq is:
A. to Liberate Iraq.
B. to maintain a cheaper supply of oil.
C. because President Bush wanted to punish President Saddam Hussain.
D. for unidentified political advancements.

1. According to individual ethical egoism one should
A. Ignore the needs of others.
B. Help others to help themselves.
C. Do what is in one’s self interest.
D. Do what makes one happy at the moment.

2. Which of the following is not an example of ethical egoism?
A. We should treat others well because we want to be treated well in return.
B. We should treat others well so they will treat others well.
C. We should work hard because a “job well done is its own reward.”
D. We should work hard because doing so is a good model for our children.

3. The ring of Gyges can best be described as which of the following?
A. A ring of inheritance indicating royalty.
B. A ring that represents a committed romance.
C. A ring that cam make the wearer invisible.
D. A geological formation in ancient Greece.

Question 1
One advantage of hydroelectric power generation is:
A. the production of high-level chemical waste but no greenhouse gases.
B. very high efficiency converting water to electrical energy.
C. a wide range of sites for plant construction.
D. low construction costs.

Question 2
Which of the following is NOT a disadvantage of hydroelectric power generation?
A. Dam construction causes loss of land suitable for agriculture.
B. Dam construction prevents upstream migration of fish.
C. Downstream water flow becomes unpredictable and creates extreme conditions.
D. Drought conditions can affect power production.

Question 3
The biggest roadblock for electric cars is:
A. storing the electricity needed to run them.
B. the inefficiency of the electric motor.
C. the lack of usable prototypes.
D. low-volume production.

Question 1
According to the textbook, Iceland’s proposed hydrogen economy is driven by all of the following EXCEPT:
A. recent developments in hydrogen fuel cells.
B. the movement to combat global climate change.
C. concerns over the price and supply of oil.
D. ethnic pride.

Question 2
All of the following processes are used in biomass energy technology EXCEPT:
A. radiation.
B. combustion.
C. gasification.
D. pyrolysis.

Question 3
The technology that converts solar radiation into electricity is called __________ energy.
A. fossil fuel
B. hydroelectric
C. nuclear
D. photo-voltaic

1. Strong ethical relativism holds that
A. There is no objective right and wrong.
B. Right and wrong are not really knowable.
C. Some actions are more right than others.
D. All actions are equally moral.

2. Which is not a reason for supporting ethical relativism
A. Moral uncertainty.
B. Diversity of moral views.
C. Situational differences.
D. Social cohesion.


3. According to psychological egoism people
A. Act in ways that are harmful to them.
B. Often act against their own self interests.
C. Act in the way they perceive to be best for them.
D. Act out of deep subconscious needs.