CHAPTER 1 Managers and Entrepreneurs 1. T F Fortunately, through conducting over 1,000 studies during the past 50 years, leadership scholars have produced a clear profile of an ideal leader. Ans: False AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 3 2. T F Drawing on the physician role models of the youth, Vasella built an entirely new Novartis culture centered on compassion, competence, and competition. Ans: True AACSB Outcomes: D; E Degree of Difficulty: Hard Learning Level: fact Page: 4 3. T F Unfortunately, Novartis's new compassion culture has resulted in the company's downfall. Ans: False AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 4 4. T F Speed is the only certainty in today's climate. Ans: False AACSB Outcomes: A Degree of Difficulty: Easy Learning Level: fact Page: 5 5. T F In the battle to stay competitive, the quality of products and services is the driving force. Ans: True AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: fact Page: 5 6. T F Without learning and continuous improvement, true economic progress for individuals and organizations cannot be achieved. Ans: True AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 5 7. T F Management is the process of working with others, not through others, to achieve organizational objectives. Ans: False AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 5 8. T F Central to the management process is the effective and efficient use of limited resources. Ans: True AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: fact Page: 5 9. T F Management, above all else, is a political process. Ans: False AACSB Outcomes: R Degree of Difficulty: Moderate Page: 5 Learning Level: fact 10. T F Those who have not lived up to their peers' and superiors' high expectations are derailed managers. Ans: True AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 6 11. T F Mismanagement of funds was the number one problem in the derailed managers study. Ans: False AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact 12. T F An objective is a target to be strived for and attained. Ans: True AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: fact Page: 6 Page: 6 13. T F Always required for organizational objectives or goals is collective action. Ans: True AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 6 14. T F Without organizational objectives, the management process would be aimless and wasteful. This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. 2 Chapter 1: Managers and Entrepreneurs Ans: True AACSB Outcomes: R Degree of Difficulty: Moderate Page: 7 15. 16. T F Achieving a stated objective necessarily involves efficiency. Ans: False AACSB Outcomes: R Degree of Difficulty: Moderate Page: 7 Learning Level: fact Learning Level: fact T F The amount of resources used is irrelevant when calculating efficiency. Ans: False AACSB Outcomes: A Degree of Difficulty: Easy Learning Level: fact Page: 7 17. T F When too much emphasis is placed on either effectiveness or efficiency, mismanagement can occur. Ans: True AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 7 18. T F When organizations waste resources, they are efficient but not effective. Ans: False AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 7 19. T F The United States, based on its population, uses less than its share of global resources. Ans: False AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 8 20. T F Chemistry and management, because of their common focus on resources, are closely related. Ans: False AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: fact Page: 8 21. T F The study of how limited resources are distributed among alternative uses is human resource management. Ans: False AACSB Outcomes: A Degree of Difficulty: Easy Learning Level: fact Page: 8 22. T F "Applied economics" is a good term for management. Ans: True AACSB Outcomes: R Degree of Difficulty: Moderate Page: 8 Learning Level: fact 23. T F Less than 40 percent of the world's population will live in relatively poor and less-developed countries in the year 2020. Ans: False AACSB Outcomes: A; D Degree of Difficulty: Hard Learning Level: fact Page: 8 24. T F Environmentalism is one of the five major sources of change for managers. Ans: True AACSB Outcomes: R Degree of Difficulty: Hard Learning Level: fact Page: 8 25. T F The globe is growing in almost every conceivable way, figuratively speaking. Ans: False AACSB Outcomes: A; T Degree of Difficulty: Moderate Learning Level: fact Page: 8 26. T F Broadband Internet has allowed skilled jobs to be outsourced to well-educated workers in India, China, and Russia. Ans: True AACSB Outcomes: R; T Degree of Difficulty: Moderate Learning Level: fact Page: 9 27. T F Offshoring occurs "when foreign multinationals open offices in their home countries and hire Americans." Ans: False AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 9 28. T F Thanks to the work of quality guru Mary Parker Follett, product/service quality has become a driving force in all organizations. Ans: False AACSB Outcomes: R Degree of Difficulty: Hard Learning Level: fact Page: 10 29. T F The emphasis of the build-it-in approach is identifying and eliminating causes of quality problems. Ans: True AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 10 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. Chapter 1: Managers and Entrepreneurs 30. T F The focus of the inspect-it-in approach to quality is intense customer and employee involvement during the entire design-production cycle. Ans: False AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 10 31. T F Continuous improvement of personnel, processes, and product is emphasized in the design-it-in approach. Ans: True AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 10 32. T F A popular label for the fix-it approach to quality is TQM. Ans: False AACSB Outcomes: A Degree of Difficulty: Easy 3 33. Learning Level: fact T F The initials TQM stand for techniques for quality measurement. Ans: False AACSB Outcomes: R Degree of Difficulty: Moderate Page: 10 Page: 10 Learning Level: fact 34. T F Managers are challenged to develop innovative ways to make a profit without unduly harming the environment in the process. Ans: True AACSB Outcomes: E; R Degree of Difficulty: Moderate Learning Level: fact Page: 10 35. T F Investors, given that they have the primary concern of making money, do not care whether an organization is environmentally "clean" or "dirty," as long as it is profitable. Ans: False AACSB Outcomes: E Degree of Difficulty: Easy Learning Level: fact Page: 11 36. T F According to a survey of employees, drug abuse is the number one ethical problem in the workplace. Ans: False AACSB Outcomes: A; E Degree of Difficulty: Moderate Learning Level: fact Page: 11 37. T F Strong pressure has been placed on managers to behave ethically due to years of headlines about discrimination, accounting fraud, and insider trading. Ans: True AACSB Outcomes: E Degree of Difficulty: Easy Learning Level: fact Page: 11 38. T F A sound ethical compass was number one on a Top 10 list of leadership qualities, according to a survey by The Economist magazine. Ans: True AACSB Outcomes: E Degree of Difficulty: Hard Learning Level: fact Page: 11 39. T F Even though the concept of the Internet began as a U.S. Department of Defense research project, IBM owns the Web today. Ans: False AACSB Outcomes: T Degree of Difficulty: Hard Learning Level: fact Page: 12 40. T F The Internet is a global network of servers and computers. Ans: True AACSB Outcomes: C; T Degree of Difficulty: Easy Page: 12 41. T F By 2011, an estimated 3 billion people worldwide will be online. Ans: False AACSB Outcomes: C; T Degree of Difficulty: Hard Page: 12 Learning Level: fact Learning Level: fact 42. T F Currently, the e-business revolution is proceeding in a more measured way and with more realistic expectations. Ans: True AACSB Outcomes: C; T Degree of Difficulty: Moderate Learning Level: fact Page: 12 43. T F A business characterized solely by its use of the Internet to sell goods online is an e-business. Ans: False AACSB Outcomes: T Degree of Difficulty: Easy Learning Level: fact Page: 12 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. 4 Chapter 1: Managers and Entrepreneurs 44. T F Management is a complex and dynamic mixture of systematic techniques and common sense. Ans: True AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 13 45. T F Managerial functions are general administrative duties that need to be carried out in virtually all productive organizations. Ans: True AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 13 46. T F Frenchman Henri Fayol identified eight universal managerial functions and became the father of the functional approach. Ans: False AACSB Outcomes: R Degree of Difficulty: Hard Learning Level: fact Page: 13 47. T F Wilson isolated five functions he believes are common to all managers. Ans: False AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 13 48. T F Planning is the primary management function, which also involves the formulation of future courses of action. Ans: True AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: fact Page: 14 49. T F Comparing desired results with actual results so corrective action can be taken involves the decision-making function. Ans: False AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 14 50. T F Managers should be responsive to feedback and upward communication, recognizing that communication is a two-way process. Ans: True AACSB Outcomes: C; R Degree of Difficulty: Easy Learning Level: fact Page: 14 51. T F About 10 percent of managers at all levels, according to research by Clark L. Wilson, do not achieve an appropriate balance of managerial skills and are thus ineffective. Ans: False AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 14 52. T F Fifty-eight percent of U.S. managers say they feel overwhelmed at work today. Ans: False AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 15 53. T F It is expected that the pace will slow down for future managers, even though the pace of work for today's managers is hectic. Ans: False AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 16 54. T F Interruptions, according to research, are what the work of top managers is all about and actually constitute a valuable resource. Ans: True AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 16 55. T F According to one management expert, accepting a management position means losing the right to resist change and to lose your temper. Ans: True AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 16 56. T F Management requires clear-headed individuals who can envision something better and turn it into reality by working with and through others. Ans: True AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 16 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. Chapter 1: Managers and Entrepreneurs 57. T F According to the Honeywell study, the primary way in which managers learn to manage is through formal training. Ans: False AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 17 58. T F The "school of hard knocks" includes being personally attacked and feeling threatened. Ans: True AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: fact 5 Page: 17 59. T F Future managers, according to research, can best learn to manage by disregarding theories, focusing on practice, and observing role models. Ans: False AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 17 60. T F Full-time students tend to get a lot of theory and little practice. Ans: True AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: fact Page: 18 61. T F Unfortunately, small businesses are too small to attract media attention, and even collectively they have never been a huge and vibrant part of the global economy. Ans: False AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 19 62. T F With fewer than five employees, typically operating out of the owner's home, about 30 percent of small businesses are "microbusinesses." Ans: False AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 19 63. T F A small business is an independently owned and managed profit-seeking enterprise employing fewer than 50 people. Ans: False AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: fact Page: 19 64. T F The small business failure rate, according to recent evidence, is only 18 percent during the first eight years of operation. Ans: True AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 19 65. T F Given their high failure rate, small firms produced practically no new jobs between 1987 and 1992. Ans: False AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 19 66. T F On average, small businesses pay employees less than big companies and are about half as likely to offer health insurance benefits. Ans: True AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 20 67. T F The process by which individuals pursue opportunities without regard to the resources they currently control is entrepreneurship. Ans: True AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 20 68. T F Compared to general administrators, entrepreneurs are less comfortable with ambiguity and risk taking. Ans: False AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 21 69. T F The problem of organizations outgrowing the entrepreneur's ability to manage them has been called founder's disease. Ans: True AACSB Outcomes: R Degree of Difficulty: Hard Learning Level: fact Page: 22 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. 6 70. 71. Chapter 1: Managers and Entrepreneurs Vasella was able to build an entirely new Novartis culture centered on which of these? a) Compassion, competence, and competition b) Whistle-blowing and cutting jobs c) Ethics, diversity, and global expansion d) Focus on bottom line, cutting middle management jobs, and acquisitions e) Government regulations, hiring top experts to lobby, and piece-rate pay systems Ans: a AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact _______ is the driving force in the battle to stay competitive today. a) Speed b) Flexibility c) Change d) Teamwork e) Product/service quality Ans: e AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: fact Page: 4 Page: 5 72. The key to true economic progress for individuals and organizations is continuous improvement and a) foreign competition. b) government assistance. c) life-long learning. d) job satisfaction. e) communication. Ans: c AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 5 73. From both strategic and operational standpoints, speed, teamwork, and _______ are the orders of the day. a) authoritarianism b) flexibility c) hazardous working conditions d) stress e) quality malfunction Ans: b AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 5 74. What is the process of working with and through others to achieve organizational objectives in a changing environment called? a) Management b) Leading c) Planning d) Organizing e) Controlling Ans: a AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 5 75. Central to the management process is a) maintaining the status quo in a changing environment. b) maximizing profits. c) the effective and efficient use of limited resources. d) becoming an employee-centered leader. e) enhancing interpersonal relationships. Ans: c AACSB Outcomes: R Degree of Difficulty: Moderate 76. Above all else, management a _______ process. a) technical b) social c) political d) economic e) profit-oriented Ans: b AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: fact Learning Level: fact Page: 5 Page: 5 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. 77. Chapter 1: Managers and Entrepreneurs 7 Which of the following is not a key component in the definition of management? a) Coping with a changing environment b) Making the most of limited resources c) Working with and through others d) Maximizing shareholder wealth e) Balancing effectiveness and efficiency Ans: d AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 5 78. John Jackson recently read about the derailed managers study. Being a first-line manager and aspiring to climb the management ladder, John wants to avoid the mistakes involving working effectively with and through others identified in the study. Which of the following does he need to work on? a) The ability to think in closed-system terms b) The ability to build and lead a team c) The ability to predict the future d) The ability to meet strangers e) The ability to avoid change Ans: b AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 6 79. Connie Cobalt is having difficulty as a manager because she is hampered by a problem identified in the derailed managers study. What may be Connie's problem? a) She does not pay appropriately. b) She is manipulative. c) She is unable to staff effectively. d) She is overly ambitious. e) She is too lenient. Ans: b AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 6 80. Just as its founder had planned, Mountain City Coffee opened its 1,000th store in 2008. This is an example of a) coping with a changing environment. b) working with and through others. c) achieving an organizational objective. d) making the most of limited resources. e) balancing effectiveness and efficiency. Ans: c AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: appl Page: 6 81. What is(are) always required by organizational objectives or goals? a) Management approval b) Collective action c) Job descriptions d) Financial resources e) Information gathering Ans: b AACSB Outcomes: R Degree of Difficulty: Moderate 82. Learning Level: fact Page: 6 Without _______, the management process would be aimless and wasteful. a) organizational objectives b) competitive pressure c) employee involvement d) shareholder commitment e) organizational profits Ans: a AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 7 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. 8 83. 84. Chapter 1: Managers and Entrepreneurs ________ entails promptly achieving a stated objective, whereas ________ enters the picture when the resources required to achieve an objective are weighed against what was actually accomplished. a) Quality; quantity b) Effectiveness; efficiency c) Effectiveness; quality d) Efficiency; quality e) Efficiency; effectiveness Ans: b AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 7 An organization is more efficient with a more _______ ratio of benefits to costs. a) favorable b) uniform c) predictable d) stable e) unfavorable Ans: a AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 7 85. Changing his major three times, Scott earned his college degree after retaking four classes and spending twice as much as his family had budgeted. In terms of the definition of management, Scott was a) ineffective but efficient. b) partly effective and partly efficient. c) effective but not efficient. d) neither effective nor efficient. e) both effective and efficient. Ans: c AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 7 86. Amy, a sales representative for Plastic Wares Company, failed to achieve her sales quota last year but was praised by her manager for saving 25 percent on her expense account. Amy was a) effective but not efficient. b) somewhat effective and very inefficient. c) not effective but efficient. d) both effective and efficient. e) not effective and not efficient. Ans: c AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 7 87. At the expense of instructional excellence, the dean of students at State College wants to increase the average class size from 30 to 100 students. If this happens, it would be a) not effective but efficient. b) somewhat effective and very inefficient. c) effective but not efficient. d) not effective and not efficient. e) both effective and efficient. Ans: a AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 7 88. Professor Harriet Smalls is a strong believer in maintaining smaller class sizes at the university where she is the president. This means hiring additional faculty and spending more money than allocated every year. However, the students are happy and are receiving a top-quality education. Professor Smalls is a) somewhat effective and very inefficient. b) effective but not efficient. c) not effective but efficient. d) not effective and not efficient. e) both effective and efficient. Ans: b AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 7 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. 89. Chapter 1: Managers and Entrepreneurs _______ is a favorable ratio between inputs and outputs. a) Management b) TQM c) Productivity improvement d) Ethical reawakening e) E-business Ans: c AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: fact Page: 7 90. If Nissan produces 69 cars per worker annually, whereas Hyundai only produces 51 cars per worker, it can be said that in terms of labor productivity, a) both are inefficient. b) Hyundai is both more effective and more efficient than Nissan. c) Hyundai is more effective but Nissan is more efficient. d) Nissan is more effective but Hyundai is more efficient. e) Nissan is both more effective and more efficient than Hyundai. Ans: e AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 7 91. According to demographers, who collect and study population statistics, Earth's population is a) shrinking by over 2 million people annually. b) growing by over 200,000 people every week. c) remaining constant. d) growing by over 200,000 people every day. e) growing by 6.2 million people every year. Ans: d AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 8 92. Only about 5 percent of the world's population lives in the United States, but about _______ percent of the world's annual oil production is consumed in the United States. a) 25 b) 50 c) 5 d) 35 e) 17 Ans: a AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 8 93. The world population, within 70 years, is projected to reach a) 970 million. b) 9 billion. c) 5 billion. d) 6.1 billion. e) 69 billion. Ans: b AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 8 94. It is estimated that in the year 2020, _______ percent of the world population will live in _______ countries. a) over 65; industrialized b) over 95; industrialized c) over 23; poor and less-developed d) less than 10; poor and less-developed e) over 80; poor and less-developed Ans: e AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 8 95. The study of management and the study of _______ are closely related. a) sociology b) philosophy c) geography d) economics e) psychology Ans: d AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 8 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. 9 10 96. 97. Chapter 1: Managers and Entrepreneurs Economics and management are closely related because of their common focus on a) employees. b) resources. c) budgets. d) profitability. e) effectiveness. Ans: b AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Tomorrow's managers, according to Business Week, will need all of the following except a) the toughness of a boxer. b) the charm of a debutante. c) the quickness of a panther. d) a keen understanding of technology. e) a sense of humor, passion, and the ability to make decisions rapidly. Ans: a AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 8 Page: 8 98. All of the following are overarching sources of change for managers in the twenty-first century except a) the Internet revolution. b) product quality. c) mass production and marketing. d) environmentalism. e) globalization. Ans: c AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 8 99. Which of following terms refers to the practice of sending jobs from developed countries to low-wage countries? a) Offshoring b) Inshoring c) Reengineering d) Resourcing e) Importing Ans: a AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 8 100. Sally Reeves is a manager at a call center. She is worried that she may lose her job due to offshoring. What would be the best insurance against having her job outsourced to a foreign country? a) Getting a promotion b) Continuing her education c) Filing a grievance with her union d) Moving to a lower-tech industry e) Seeking work outside of the country Ans: b AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 8-9 101. Today's model manager is one who is a) comfortable keeping things the way they are. b) only comfortable conducting business within his or her own country. c) comfortable transacting business in multiple languages and cultures. d) consistently concerned with profits. e) ethnocentric in attitude. Ans: c AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 9 102. What, in chronological order, are the four distinct stages that have evolved since World War II and that place an emphasis on quality? a) Design-it-in, fix-it, copy-it-in, mix-it-in. b) Build-it-in, design-it-in, copy-it-in, fix-it. c) Fix-it, inspect-it-in, build-it-in, design-it-in. d) Copy-it-in, fix-it, build-it-in, design-it-in. e) Inspect-it-in, fix-it, design-it-in, build-it-in. Ans: c AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 10 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. Chapter 1: Managers and Entrepreneurs 103. Paula insists on reworking any defective products identified by quality inspectors at the end of the production process at Two Turtle Doves, Inc. Her company's approach to quality is a) fix-it. b) build-it-in. c) inspect-it-in. d) design-it-in. e) reactive. Ans: a AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: appl Page: 10 11 104. Which approach to quality is Great Lives, Inc. following when it requires that its quality inspectors sample work in process and prescribe machine adjustments to avoid substandard outputs? a) Build-it-in b) Inspect-it-in c) Fit-it d) Design-it-in e) Force-it Ans: b AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: appl Page: 10 105. Which product quality approach involves making everyone in the organization responsible for identifying and correcting product defects, as well as for identifying and eliminating causes of quality problems? a) Inspect-it-in b) Build-it-in c) Design-it-in d) Fix-it e) Work-it-in Ans: b AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 10 106. Bill, CEO of Toys for Tots, Inc., stated, "Everyone in my factory who touches the product is responsible for finding and eliminating the causes of quality problems." What is his approach to product quality at his toy manufacturing company? a) Design-it-in b) Inspect-it-in c) Fix-it d) Build-it-in e) Force-it-in Ans: d AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 10 107. Which stage in the evolution of product quality emphasizes continuous improvement? a) Inspect-it-in b) Fix-it c) Force-it-in d) Design-it-in e) Build-it-in Ans: d AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 10 108. Which of the following are closely associated with total quality management (TQM)? a) Design-it-in and inspect-it-in b) Build-it-in and fix-it c) Fix-it and inspect-it-in d) Build-it-in and design-it-in e) Inspect-it-in and build-it-in Ans: d AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 10 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. 12 Chapter 1: Managers and Entrepreneurs 109. Today's quality leaders strive to a) exceed customers' expectations. b) meet customers' needs. c) accurately forecast consumer trends. d) come close to the production expectations. e) engage in all functional areas to develop a cross-functional culture. Ans: a AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 10 110. Multinational corporations adhering to strict environmental standards, researchers recently found, had _______ compared to those taking advantage of lax environmental standards. a) 80 percent lower stock market valuations b) 20 percent lower stock market valuations c) the same stock market valuations d) 80 percent higher stock market valuations e) 20 percent higher stock market valuations Ans: d AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: fact Page: 11 111. According to a survey of over 4,000 employees, what was determined to be the most common ethical problem in the workplace? a) Conflict of interest b) Stealing c) Abusing drugs or alcohol d) Sexual harassment e) Lying to supervisors Ans: e AACSB Outcomes: A; E Degree of Difficulty: Moderate Learning Level: fact Page: 11 112. The Internet, in concept, began as a research project for a) the Russian government. b) IBM. c) the U.S. Department of Defense. d) Microsoft. e) Notre Dame. Ans: c AACSB Outcomes: R; T Degree of Difficulty: Easy Learning Level: fact Page: 11 113. _______ is the global network of servers and personal and organizational computers. a) URL b) The Intranet c) ISP d) The Internet e) Google Ans: d AACSB Outcomes: C; T Degree of Difficulty: Easy Learning Level: fact Page: 12 114. Individuals and businesses began to log on to the Internet to communicate via e-mail and to buy, sell, and trade things a) in the early 1980s. b) in the early 1990s. c) in the late 1980s. d) in the late 1990s. e) early in the twenty-first century. Ans: b AACSB Outcomes: C; T Degree of Difficulty: Hard Learning Level: fact Page: 1112 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. Chapter 1: Managers and Entrepreneurs 13 115. A(n) _______ is a business using the Internet for greater efficiency in every aspect. a) global business b) integrated business c) small business d) e-business e) high-tech business Ans: d AACSB Outcomes: C; T Degree of Difficulty: Easy Learning Level: fact Page: 12 116. Identifying _______ is one approach to analyzing the management process. a) managerial objectives b) management techniques c) management long-term plans d) managerial functions e) organizational culture Ans: d AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 13 117. General administrative duties that need to be carried out in virtually all productive organizations are _______. a) managerial tasks b) leadership traits c) managerial functions d) goals and objectives e) job descriptions Ans: c AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 13 118. Managerial _________ tell us what managers generally do, whereas managerial _________ tell us more precisely how managers carry them out. a) visions; goals b) desires; visions c) skills; functions d) goals; desires e) functions; skills Ans: e AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 13 119. The universal managerial functions originally identified by Henri Fayol are planning, organizing, command, coordination, and a) staffing. b) control. c) communicating. d) decision making. e) motivate. Ans: b AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 13 120. In terms of planning, decision making, motivating, and leading, Mike is actually is referring to his _______ when he describes his managerial duties at Bobcat Bikes. a) managerial functions b) communication patterns c) managerial roles d) job description e) leadership profile Ans: a AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 13 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. 14 Chapter 1: Managers and Entrepreneurs 121. Which of the following involves comparing desired results with actual results and taking corrective action? a) Organizing b) Motivating c) Planning d) Leading e) Controlling Ans: e AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 14 122. _______ consists of recruiting, training, and developing people who can contribute to the organized effort. a) Planning b) Leading c) Staffing d) Controlling e) Organizing Ans: c AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 14 123. Which function in the management process is commonly referred to as the primary management function? a) Organizing b) Leading c) Controlling d) Staffing e) Planning Ans: e AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 14 124. The owner of Krispy Kandy, Inc., which has inventory control and financial problems, is considering the following alternatives: reduce inventory, lay off people, file for bankruptcy, or sell the business. The owner is performing which management function? a) Leading b) Staffing c) Organizing d) Motivating e) Decision making Ans: e AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 14 125. _______ is the managerial function that involves structural considerations, such as chain of command, division of labor, and assignment of responsibility. a) Organizing b) Staffing c) Planning d) Controlling e) Leading Ans: a AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 14 126. Charlie, a manager at Creekside Saloon, has been considering the implementation of flexible work schedules for his employees. Charlie's goal is to increase a) managerial control. b) employee communication. c) employee control. d) employee motivation. e) organizational communication. Ans: d AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 14 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. Chapter 1: Managers and Entrepreneurs 127. Technical, teambuilding, and _______, according to Clark L. Wilson, are three skill categories used by managers. a) drive b) culture c) hierarchical d) task e) analytical Ans: a AACSB Outcomes: R Degree of Difficulty: Hard Learning Level: fact Page: 14 15 128. What percent of managers at all levels are ineffective because of imbalanced managerial skills, according to Clark L. Wilson's research? a) 40 percent b) 75 percent c) 25 percent d) 50 percent e) 33 percent Ans: a AACSB Outcomes: R Degree of Difficulty: Hard Learning Level: fact Page: 14 129. In a study of 1,040 managers in 100 rapidly changing organizations, the two leading causes of managerial failure were found to be a) poor work ethic and ineffective organizational skills. b) ineffective communication skills and poor work relationships. c) poor planning and ineffective communication skills. d) ineffective staffing and poor work relationships. e) poor research and development and weak group norms. Ans: b AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 14 130. Jake Trooper just accepted a managerial position at Penny-A-Day Car Wash. As a result, he has given up the right to do all of the following except a) lose his temper. b) promote change. c) be one of the gang. d) bring his personal problems to work. e) play favorites. Ans: b AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 16 131. According to research, the typical manager's day is best described as a) rational and logical. b) carefully scheduled. c) consisting of constant interruptions. d) like that of an orchestra leader. e) consisting largely of reflective planning. Ans: c AACSB Outcomes: R Degree of Difficulty: Moderate Page: 16 Learning Level: fact 132. Approximately _____ percent say they feel enthusiasm for their jobs, yet research from the American Management Association reports that approximately _____ percent of U.S. managers experience stress every day. a) 75; 36 b) 75; 63 c) 90; 25 d) 63; 50 e) 50; 36 Ans: d AACSB Outcomes: R Degree of Difficulty: Hard Learning Level: fact Page: 15 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. 16 Chapter 1: Managers and Entrepreneurs 133. According to the Honeywell study, the managers learned the least (20 percent) about managing from a) coworkers. b) internships. c) formal training and education. d) job assignments. e) role models. Ans: c AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 17 134. Approximately _______ percent of management knowledge, according to the Honeywell study, was acquired from relationships with others, including bosses, mentors, and coworkers. a) 40 b) 5 c) 25 d) 50 e) 30 Ans: e AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 17 135. Which is the best way for future managers to learn to manage? a) Ignore theory. b) Integrate theory and practice. c) Rely strictly on common sense. d) Get an MBA. e) Read periodicals, such as the Harvard Business Review. Ans: b AACSB Outcomes: A Degree of Difficulty: Moderate Page: 17 Learning Level: fact 136. __________ account for more than one-quarter of the nation's $1.4 trillion in business capital investment each year in the United States. a) U.S. corporations b) Multinational corporations c) Large businesses d) Small businesses e) Home-based businesses Ans: d AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 19 137. _______ of small businesses are microbusinesses, with fewer than five employees. a) Less than 5 percent b) Between 40 and 45 percent c) About 20 to 25 percent d) Between 5 and 10 percent e) About 60 percent Ans: e AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 19 138. A small business is best described as having a) up to 1,000 employees. b) no more than 25 employees. c) fewer than 100 employees. d) fewer than 10 employees. e) up to 500 employees. Ans: c AACSB Outcomes: A Degree of Difficulty: Moderate Page: 19 Learning Level: fact This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. Chapter 1: Managers and Entrepreneurs 139. In relation to the economy, small businesses can be best described as a) surf boards. b) an anchor. c) an engine. d) thrill seekers. e) community crushers. Ans: c AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 19 17 140. What percent of employers in the United States do small businesses account for? a) 99 b) 12 c) 37 d) 81 e) 69 Ans: a AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 19 141. A study by Kirchhoff shows that only _______ percent of small businesses went out of business with unpaid bills during their first _______ years. a) 50; 5 b) 80; 2 c) 25; 6 d) 18; 8 e) 75; 5 Ans: d AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 19 142. Maggie is a management major who wants to start her own business but is put off by the 80 percent failure rate statistic that she hears all the time. What should you tell her based on recent research evidence? a) The failure rate is only 4 percent in the first year. b) That statistic applies only to high-tech businesses. c) That statistic is limited to manufacturing companies. d) She has at least a 28 percent chance of success in the first three years. e) She has an 18 percent chance of failure in the first eight years. Ans: e AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 19 143. According to research done by David Birch in Cambridge, Massachusetts, between 1987 and 1992, _______ percent of small businesses created _______ percent of new jobs. a) 12; 65 b) 4; 70 c) 25; 75 d) 2; 90 e) 50; 50 Ans: b AACSB Outcomes: R Degree of Difficulty: Hard Learning Level: fact Page: 20 144. Gina, a friend of yours, says she wants to work in a small company atmosphere but has very little start-up capital. She is not worried about getting a steady paycheck at first, but she wants to run the business and seeks a high financial return in the long run. Which small business opportunity should she pursue? a) Purchase a franchise. b) Join a multinational firm. c) Take a job with a small business. d) Buy her family's small business. e) Become an independent contractor/consultant. Ans: e AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 21 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. 18 Chapter 1: Managers and Entrepreneurs 145. According to experts on the subject, entrepreneurship is the process by which individuals pursue opportunities without regard to a) intrapreneurship. b) the plans. c) resources. d) law. e) the future. Ans: c AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 20 146. Entrepreneurs are preoccupied with ________ rather than with ________. a) where; how b) how to; why not c) profits; project d) when; what e) why not; how to Ans: b AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: fact Page: 20 147. What is a common stumbling block for entrepreneurs? a) They become lazy and uncreative. b) They become preoccupied with profits. c) Their organizations outgrow them. d) They run out of money. e) They become power-hungry. Ans: c AACSB Outcomes: A Degree of Difficulty: Moderate Page: 22 148. Entrepreneurs can be best described as a) possessing managerial knowledge and experience. b) focusing on the established present. c) displaying a low-to-medium tolerance for ambiguity. d) obtaining motivation from a need to lead others. e) exhibiting moderate to high risk-taking behavior. Ans: e AACSB Outcomes: R Degree of Difficulty: Moderate Page: 21 149. Entrepreneurs tend to have ______ tolerance for ambiguity. a) medium to high b) extremely high c) no d) very little e) below average Ans: a AACSB Outcomes: R Degree of Difficulty: Moderate Page: 21 Learning Level: fact Learning Level: fact Learning Level: fact 150. Matthew possesses technical knowledge about computers and strong experience in product innovation. Which of the following is Matthew best suited to be? a) An entrepreneur b) An administrator c) A financier d) A human resource specialist e) A school teacher Ans: a AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 22 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. Chapter 1: Managers and Entrepreneurs 151. Ronald Vocelli is CEO of Rotelli Innovations--a software firm. Recently, Rotelli Innovations has grown dramatically, and Ronald finds that he lacks some confidence now that he is competing with bigger and stronger software companies. Ronald's lack of confidence is caused by a) laziness on the part of Ronald's employees. b) Rotelli Innovations' having outgrown Ronald's ability to manage. c) laziness on Ronald's part. d) Rotelli Innovations' having run out of money. e) Ronald's having become power-hungry. Ans: b AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 22 19 Use the following to answer questions 152-155: Jenna Jefferson Jenna Jefferson was recently promoted to the managing director's position at Baker's Dozen, Inc. In her new position, Jenna first compared the actual revenues and expenses of the company with desired results. Armed with this analysis, she formulated the future course of action for Baker's Dozen. One of her short-term goals is to provide the employees of Baker's Dozen with flexible working schedules. Another short-term goal is to create business lunches, in which groups of five employees meet over lunch to discuss organizational objectives. Jenna is confident that she can lead the company into a prosperous future. 152. When Jenna compares the actual revenue and expense analysis with desired results, which managerial function is she performing? a) Planning b) Communicating c) Decision making d) Controlling e) Leading Ans: d AACSB Outcomes: A Degree of Difficulty: Hard Learning Level: appl Page: 14 153. What management function will be positively affected when Jenna implements the flexible work schedule program? a) Staffing b) Controlling c) Leading d) Communicating e) Motivating Ans: e AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: appl Page: 14 154. Jenna's formulation of a future course of action for Baker's Dozen qualifies as which management function? a) Controlling b) Communicating c) Planning d) Motivating e) Leading Ans: c AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: appl Page: 14 155. When Jenna implements the lunch sessions, which of Wilson's skill categories is involved? a) Teambuilding b) Technical c) Drive d) Functional e) Procedural Ans: a AACSB Outcomes: A Degree of Difficulty: Moderate Learning Level: appl Page: 15 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. 20 Chapter 1: Managers and Entrepreneurs Use the following to answer questions 156-160: Juan Santos Juan Santos, a recent immigrant to the United States, is considering career opportunities in small business. Mr. Santos has received much contradictory and confusing information about small business/entrepreneurship in his new country. Can you help him? 156. What would you tell Mr. Santos about his career options in small business if he has no capital? a) Buy a small business owned by his family. b) Become an independent contractor/consultant. c) Take a job with a small business. d) Start his own small business. e) Purchase a franchise. Ans: c AACSB Outcomes: A Degree of Difficulty: Easy Learning Level: appl Page: 21 157. What would you tell Mr. Santos about how "small businesses" are generally defined, in terms of number of employees? a) No more than 30 b) Up to 750 c) Between 20 and 40, excluding family members d) Fewer than 10 (since he is an immigrant) e) Fewer than 100 Ans: e AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: appl Page: 19 158. Referring to his chance of success in his new business, what would you tell Mr. Santos? a) He has a 96 percent chance of success if he takes on an American partner. b) He has a 23 percent chance of success in the first seven years. c) He has a 100 percent chance of success if he survives the first three years. d) He has an 82 percent chance of success in the first eight years. e) He has no chance of success because he is an immigrant. Ans: d AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: appl Page: 19 159. Which of these entrepreneurial traits would you expect to find in Mr. Santos? a) He obtains motivation from a need to lead others. b) He has medium to high tolerance for ambiguity. c) He emphasizes internal/cost dimensions. d) He possesses managerial knowledge and experience. e) He exhibits low risk-taking behavior. Ans: b AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: appl Page: 21 160. As Mr. Santos moves toward his entrepreneurial venture, which of these common stumbling blocks for entrepreneurs would you caution him about? a) They run out of money. b) They become power-hungry. c) Their family kills the business. d) Their organizations outgrow them. e) They become lazy about introducing innovations and grow preoccupied with profits. Ans: d AACSB Outcomes: R Degree of Difficulty: Hard Learning Level: appl Page: 22 161. Discuss four key realities confronting the manager of the twenty-first century. How do these features differ from the past? Ans: (1) The only certainty is change; challenging goals motivate people to strive for improvement and overcome resistance to change. (2) Speed and flexibility are the orders of the day from both a strategic and an operational standpoint. (3) Managers at all levels need to stay close to the customer; product/service quality is the driving force in the battle to stay competitive. (4) Without life-long learning and continuous This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. Chapter 1: Managers and Entrepreneurs improvement, there can be no true economic progress for individuals and organizations alike. AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 5 21 162. Define and discuss the relationship between effectiveness and efficiency. How might an effective manager balance effectiveness and efficiency? Ans: Effectiveness is the process of management that entails achieving a stated organizational objective, whereas efficiency is the process of management that balances the amount of resources used to achieve an objective against what is actually accomplished. The more favorable the ratio of benefits to costs, the greater the efficiency. Managers are responsible for balancing effectiveness and efficiency; too much emphasis in either direction leads to mismanagement. On the one hand, managers must be effective by getting the job done. On the other hand, managers need to be efficient by reducing costs and not wasting resources. In addition, those managers who are too stingy with resources may fail to get the job done. Finding a favorable ratio between inputs and output, or productivity improvement, involves a constant struggle to balance effectiveness and efficiency. AACSB Outcomes: A; R Degree of Difficulty: Moderate Learning Level: fact Page: 7 163. Discuss three of the five overarching sources of change covered in Chapter 1. Ans: Globalization--Figuratively speaking, the globe is shrinking in almost every conceivable way. Networks of transportation, communication, computers, music, and economics have tied the people of the world together as never before. On the negative side is the controversial practice of offshoring, which is the outsourcing of jobs from developed countries to lower-wage countries. A good education and marketable skills are the best insurance against having your job outsourced to a foreign country. The Evolution of Product Quality--Thanks to U.S. and Japanese quality gurus such as W. Edwards Deming and Kaoru Ishikawa, product/service quality has become both a forethought and a driving force in effective organizations of all kinds. In the most basic terms, the emphasis on quality has evolved through four distinct stages since World War II: from "fix-it" to "inspect-it-in" to "build-it-in" to "design-it-in." Progressive managers are moving away from the first two approaches and toward the build-it-in and design-it-in approaches. Environmentalism--Managers around the world are picking up the environmental banner and putting their creative ideas to work. The Green Movement is a cultural and political force in Europe and is gaining a foothold in North America and elsewhere. Managers are challenged to develop innovative ways to make a profit without unduly harming the environment in the process. An Ethical Reawakening--Managers are under strong pressure to behave better due to recent media attention directed at discrimination, illegal campaign contributions, accounting fraud, price fixing, insider trading, the selling of unsafe products, and other unethical practices. Traditional values, such as honesty, are being reemphasized in managerial decision making and conduct. The Internet and EBusiness Revolution--Growth of the Internet has been explosive, and the implications of this massive interconnectedness are profound and revolutionary for all. Today, the e-business revolution is proceeding in a more measured way and with more realistic expectations. E-business is using the Internet for greater efficiency in every aspect of its operations. AACSB Outcomes: R Degree of Difficulty: Hard Learning Level: fact Page: 8-13 164. Explain the difference between managerial functions and managerial skills. What is significant about both with regard to a manager's job? Ans: Managerial functions are general administrative duties that need to be carried out in all productive organizations. These include planning, organizing, command, coordination, and control. Managerial skills are specific observable behaviors that effective managers exhibit. According to Clark L. Wilson, the three categories of managerial skills are technical, teambuilding, and drive. Functions consist of what managers generally do, and skills reflect more precisely how they carry out those functions. AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: fact Page: 13-16 165. What were the results of the Honeywell study regarding how managers learn to manage? What do these results say about the relative importance of formal management education? Ans: Half of the study subjects' managerial knowledge came from job assignments, meaning practical experience or the "school of hard knocks." Thirty percent of what they knew about management came from relationshipstheir interactions with others. The remaining 20 percent was acquired through formal training and education. Formal education provides a relatively small but crucial theoretical and conceptual foundation for learning by doing. However, the best way for students to learn to manage is by integrating This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. 22 Chapter 1: Managers and Entrepreneurs theory and practice and observing role models. AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 17 166. Identify the different small-business career options. Which one is the best? Why? Ans: The five small business career options are (1) become an independent contractor/consultant, (2) take a job with a small business, (3) join or buy a small business owned by your family, (4) purchase a franchise, and (5) start your own business. There is no one best option. Success in the small-business sector depends on the right combination of money, talent, hard work, luck, and opportunity. AACSB Outcomes: R Degree of Difficulty: Easy Learning Level: fact Page: 21 167. How do entrepreneurs differ from administrators? Ans: Entrepreneurs tend to be more future and externally focused, have a higher tolerance for ambiguity, take more risk, have higher achievement motivation, and possess more specific technical knowledge. Administrators focus on the established present, emphasize internal/cost dimensions, have a lower tolerance for ambiguity, take less risks, obtains motivation from a need to lead others, and possess managerial knowledge and experience. AACSB Outcomes: A Degree of Difficulty: Easy Learning Level: fact Page: 22 This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. CHAPTER 3 The Changing Environment of Management: Diversity, Global Economy, and Technology 1. T F Company loyalty is said to rank low on generation Y's list of what is important in life. Ans: True AACSB Outcomes: R Degree of Difficulty: Moderate Learning Level: fact Page: 59 2. T F Generation Y members are different in many respects, from their upbringing to their politics. Ans: True AACSB Outcomes: D; R Degree of Difficulty: Moderate Learning Level: fact Page: 59 3. T F Interestingly, more than two-thirds of 18- to 25-year-olds surveyed by the Pew Research Center for the People and the Press have a tattoo. Ans: False AACSB Outcomes: D; R Degree of Difficulty: Moderate Learning Level: fact Page: 60 4. T F As discussed in Chapter 3, the general environment of management includes social, economic, international, and technological dimensions. Ans: False AACSB Outcomes: D; R; T Degree of Difficulty: Moderate Learning Level: fact Page: 61 5. T F Society, according to sociologists, is the product of a constant struggle between the forces of stability and change. Ans: True AACSB Outcomes: D; R Degree of Difficulty: Moderate Learning Level: fact Page: 61 6. T F Employment opportunities for both men and women will continue to grow, according to the demographic trends of the new workforce, but will grow at a faster rate for men. Ans: False AACSB Outcomes: A; D Degree of Difficulty: Moderate Learning Level: fact Page: 62 7. T F Demographics is the study of managerial job opportunities. Ans: False AACSB Outcomes: D; R Degree of Difficulty: Easy Page: 61 Learning Level: fact 8. T F The U.S. workforce is getting older, more diverse, and increasingly female. Ans: True AACSB Outcomes: D; R Degree of Difficulty: Moderate Learning Level: fact Page: 62 9. T F By 2050, the 65-and-over segment of the U.S. population will grow to 21 percent, according to the U.S. Census Bureau. Ans: True AACSB Outcomes: D; R Degree of Difficulty: Moderate Learning Level: fact Page: 62 10. T F Due to quick cultural integration, products and advertising do not need to be tailored to the rapidly growing Hispanic/Latino population. Ans: False AACSB Outcomes: D; R Degree of Difficulty: Moderate Learning Level: fact Page: 62 11. T F The quality of the U.S. labor force is a major concern today. Ans: True AACSB Outcomes: R Degree of Difficulty: Moderate Page: 62 12. Learning Level: fact T F The U.S. workforce is presently at a competitive disadvantage globally because of deficient skils in reading, writing, science, and basic math. This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. . 49 Chapter 3: The Changing Environment of Management: Diversity, Global Economy, and Technology Ans: True AACSB Outcomes: D; R Degree of Difficulty: Moderate Learning Level: fact Page: 62 13. T F According to experts, almost 10 percent of working adults in the United States are functionally illiterate. Ans: False AACSB Outcomes: D; R Degree of Difficulty: Moderate Learning Level: fact Page: 62 14. T F English as a Second Language programs, according to a survey from Training magazine, are the most common remedial training programs used by the companies surveyed. Ans: False AACSB Outcomes: D; R Degree of Difficulty: Hard Learning Level: fact Page: 63 15. T F According to research, older workers are far less productive than the average worker. Ans: False AACSB Outcomes: D; R Degree of Difficulty: Moderate Learning Level: fact Page: 63 16. T F According to research, older workers have a higher absenteeism rate than other age groups. Ans: False AACSB Outcomes: D; R Degree of Difficulty: Moderate Learning Level: fact Page: 63 17. T F Research provides conclusive evidence that older workers have an unacceptably high rate of workplace accidents. Ans: False AACSB Outcomes: D; R Degree of Difficulty: Hard Learning Level: fact Page: 63 18. T F Older workers need to be managed according to their individual abilities. Ans: True AACSB Outcomes: A; D Degree of Difficulty: Hard Learning Level: fact Page: 64 19. T F The new social contract between employer and employee is based on convenience and mutual benefits, not on a lifetime arrangement. Ans: True AACSB Outcomes: D; R Degree of Difficulty: Hard Learning Level: fact Page: 64 20. T F In the period between World War II and the 1970s, the implicit social contract between employees and employers was "be loyal to the company and the company will take care of you until retirement." Ans: True AACSB Outcomes: D; R Degree of Difficulty: Hard Learning Level: fact Page: 64 21. T F In the U.S. workforce, for every dollar that men earned in 2003, women earned 62 cents. Ans: False AACSB Outcomes: D; R Degree of Difficulty: Moderate Learning Level: fact Page: 65 22. T F Fortunately, in the U.S. workplace, recent years have seen a nearly complete closing of the pay gap between men and women. Ans: False AACSB Outcomes: D; R Degree of Difficulty: Hard Learning Level: fact Page: 65 23. T F The glass ceiling affects both women and minorities. Ans: True AACSB Outcomes: D; R Degree of Difficulty: Moderate Page: 65 Learning Level: fact 24. T F Going into 2007, the Fortune 500 companies were headed by 449 men and 51 women. Ans: False AACSB Outcomes: D; R Degree of Difficulty: Hard Learning Level: fact Page: 65 25. T F Half of the Fortune 500 companies have no women on their board of directors. Ans: False AACSB Outcomes: D; R Degree of Difficulty: Hard Learning Level: fact Page: 65 26. T F The glass ceiling, according to Working Woman magazine, results from a serious shortage of qualified women for executive positions. This edition is intended for use outside of the U.S. only, with content that may be different from the U.S. Edition. This may not be resold, copied, or distributed without the prior consent of the publisher. Chapter 3: The Changing Environment of Management: Diversity, Global Economy, and Technology 50 Ans: False AACSB Outcomes: D; R Degree of Difficulty: Hard Learning Level: fact Page: 65 27. T F Today, women-owned businesses in the United States employ more than 27 million people. Ans: True AACSB Outcomes: D; R Degree of Difficulty: Hard Learning Level: fact Page: 65 28. T F Unemployment among whites and among blacks is about the same in the United States. Ans: False AACSB Outcomes: A; D Degree of Difficulty: Moderate Learning Level: fact Page: 65 29. T F The term "contingent workers" refers to employees who can be called to active military duty at any time. Ans: False AACSB Outcomes: D; R Degree of Difficulty: Moderate Learning Level: fact Page: 66 30. T F The common denominator among part-time workers, temporary workers, on-call employees, and independent contractors is that they do not have a long-term implicit contract with their employers. Ans: True AACSB Outcomes: A; D Degree of Difficulty: Hard Learning Level: fact Page: 66 31. T F Part-timers generally are much less expensive to employ than full-time employees. Ans: True AACSB Outcomes: D; R Degree of Difficulty: Easy Learning Level: fact Page: 66 32. T F Researchers have found that part-timers actually have greater job involvement than their full-time coworkers. Ans: False AACSB Outcomes: D; R De