Which of the following statements is true regarding the profitability of new businesses? a. It may take several years for a new business to begin showing a profit. b. Profitability is not an important issue for new businesses. c. Most new businesses will turn a profit within the first year. d. If a company does not show a profit within the first year, it will fail. e. Most new businesses are highly profitable when they first start. What is a common mistake that small-business owners make when their businesses starts growing? a. They sell more goods and services. b. They put too much money in advertising. c. They move beyond their local area. d. They over expand without proper planning. e. They invest too much of their own money. Imagine that you want to open your own small business. You will probably be most concerned with having a. a lot of inventory in the warehouse on opening day. b. a really good lawyer and an even better accountant. c. the best Madison Avenue ad agency money can buy. d. a good source of capital and good management skills. e. a top-notch marketing consultant and a lot of inventory in the warehouse. Victor owns his own motorcycle and ATV store. He notices that many of his customers talk about golf while in his store. He quickly adds golf carts and golf clubs to his merchandise selection. Rapidly adjusting to the needs of his customers is possible because small businesses a. have personal relationships with their customers. b. have the ability to quickly adapt to change. c. are independent. d. have simplified record keeping. e. run the risk of failure. Suppose that Diane plans to open a new, deluxe hamburger bar near your college. Her business plan most likely would not include a. the nature and mission of her new business. b. an explanation of why the new business is a good idea. c. a detailed discussion of her goals. d. an actual sample of the product. e. an analysis of costs. SBA stands for a. Special Business Agency. b. Small Bond Administration. c. Society for Business Alliances. d. Special Business Association. e. Small Business Administration. The franchisee supplies a. the required training for the franchised business. b. a known and advertised business name. c. a method of doing business. d. the required materials for the franchised business. e. labor and capital, and owns and operates the outlet. Coordinating people and the other resources of an organization to achieve the goals of the organization is the process of ______. a. management b. planning c. organizing d. directing e. leading Specific statements detailing what the organization intends to accomplish over a short period of time are called _____. a. planning statements b. strategies c. control statements d. objectives e. goals The process of influencing people to work toward a common goal is a. motivating. b. leading. c. a sign of an autocratic leader. d. a hands-off approach. e. implementing. Grouping resources and activities to efficiently and effectively accomplish a result is called _____. a. planning b. organizing c. directing d. controlling e. goal setting A manager who has the abilities to relate to people, understand their needs, and show compassion has ____ skills. a. personal b. people c. compassionate d. communication e. interpersonal The leadership style advocating that a leader involve subordinates in most decisions as well as the assignment of tasks is called _____. a. laissez-faire b. hands-off c. existential d. authoritarian e. democratic The first step in the managerial decision-making process is to a. evaluate the problem. b. create a problem opportunity. c. identify the problem or opportunity. d. identify a solution to the problem. e. generate alternative solutions to the problem. An organization chart reveals a. staff accountability. b. committee assignments. c. informal authority. d. detailed duties of each manager. e. the companys organizational structure. General Motors has separate divisions for Chevrolet, Pontiac, Oldsmobile, Buick, and Cadillac. This is an example of departmentalization by _____. a. function b. location c. customer d. product e. model A manager with many subordinates is said to have a a. tall organizational structure. b. narrow span of control. c. managerial hierarchy. d. wide span of control. e. matrix structure. Design engineers at IBM provide suggestions about what materials to use in making a product and how the product is to be manufactured. This exhibits the use of ____ authority. a. line b. staff c. group d. informal e. organizational Regulations and standard operating procedures pretty much guarantee uniformity and support the ____ organizational structure. a. cluster b. matrix c. formal d. informal e. bureaucratic A committee created for a specific short-term purpose is called a(n) _____. a. task force b. standing committee c. ad hoc committee d. informal group e. organic structure All of the managerial activities in which managers engage for the purpose of creating goods and services are known as ____ management. a. personnel b. operations c. production d. site e. plant To produce a BMW sport-utility vehicle, an operations manager must engage in all of the following activities except a. recruiting human resources. b. controlling product quality. c. the effective use of planning. d. inventory management. e. controlling production costs. A set of activities intended to identify new ideas and technical advances that may result in new goods and services is called _____. a. research and development b. operations management c. design planning d. product design e. horizon planning When Panasonic improves the sound, clarity, and ease of operation offered by its DVD player, it is a. shortening its product life cycle. b. extending its basic research. c. redistributing its product. d. refining its existing product. e. reducing the DVD players functionality. When Taco Bell determines what different food items it will offer on its menu and how many it will offer, it is deciding its _____. a. capacity b. design planning c. product design d. product life cycle e. product line The objective of ____ is to decide on the amount of products or services each facility will produce during a specified period of time. a. design planning b. strategic planning c. operational planning d. capacity planning e. output specification _____ consists of all the activities involved in obtaining required materials, supplies, components and parts from other firms. a. Inventory scheduling b. Purchasing c. Operational planning d. Scheduling e. Product design