BBA Business Management Chapter 1 Quiz
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Questions and Answers

Which of the following best describes 'capital' in a business context?

  • The creation of business ideas
  • Machines, equipment, tools, and physical facilities (correct)
  • The employees of a business
  • Knowledge used to produce services

    • E-business involves the use of electronic communications to produce or sell products and services.

    True (A)

    What is the term for the knowledge or tools used to produce products and services?

    technology

    Improved communication with customers is an advantage of technology and ___________.

    <p>e-commerce</p> Signup and view all the answers

    Match the following stakeholders with their descriptions:

    <p>Business owners = Entrepreneurs and stockholders Creditors = Provide loans or credit Employees = Managers and staff Suppliers = Provide materials or services</p> Signup and view all the answers

    Which stakeholder group includes managers?

    <p>Employees (D)</p> Signup and view all the answers

    Entrepreneurship involves a lack of willingness to take risks.

    <p>False (B)</p> Signup and view all the answers

    What is the primary purpose of information technology (IT)?

    <p>to enable information to be used to produce products and services</p> Signup and view all the answers

    One impact of technology in business is improved ________ which is faster production.

    <p>efficiency</p> Signup and view all the answers

    Which of the following is NOT listed as a stakeholder group?

    <p>Competitors (A)</p> Signup and view all the answers

    What is the primary goal of a for-profit business?

    <p>To maximize owner wealth through profits (A)</p> Signup and view all the answers

    A nonprofit business is primarily focused on generating profits for its owners.

    <p>False (B)</p> Signup and view all the answers

    What is the basic formula for calculating profit?

    <p>Revenue - Expenses</p> Signup and view all the answers

    The midterm exam will cover chapters 1, 3, and ______

    <p>7</p> Signup and view all the answers

    Which of the following is NOT a key business decision?

    <p>Customer service (C)</p> Signup and view all the answers

    The final exam is scheduled for January 29, 2025.

    <p>False (B)</p> Signup and view all the answers

    Name one type of natural resource.

    <p>Minerals, water, wind, or oil</p> Signup and view all the answers

    A business's revenue is the money it brings in through sales of goods and ______

    <p>services</p> Signup and view all the answers

    Which of the following best describes what a business is?

    <p>A profit-seeking organization that provides products or services. (B)</p> Signup and view all the answers

    What is a key factor in differentiating a product from competitors?

    <p>Identifying a competitive advantage (C)</p> Signup and view all the answers

    The economic environment has no impact on business decisions.

    <p>False (B)</p> Signup and view all the answers

    Name one function of business that deals with obtaining and using funds.

    <p>Finance</p> Signup and view all the answers

    The __________ environment includes factors such as competition from other businesses and market conditions.

    <p>competitive</p> Signup and view all the answers

    Match the following business functions with their primary focus:

    <p>Management = Use of resources Marketing = Product promotion Finance = Fund management Accounting = Financial analysis</p> Signup and view all the answers

    What is a common marketing decision a firm may need to make?

    <p>What price should be charged (A)</p> Signup and view all the answers

    Management decisions do not require assessing the feasibility of an idea.

    <p>True (A)</p> Signup and view all the answers

    What is one necessary resource to develop a new business idea?

    <p>Funding</p> Signup and view all the answers

    The __________ environment directs how businesses comply with laws and regulations.

    <p>legal and regulatory</p> Signup and view all the answers

    Which function of business is primarily concerned with summarizing financial conditions?

    <p>Accounting (C)</p> Signup and view all the answers

    What must a firm provide to shareholders?

    <p>A decent return on their investment (D)</p> Signup and view all the answers

    Stockholders are the individuals who provide loans to a business.

    <p>False (B)</p> Signup and view all the answers

    What is the primary goal of managers in a business?

    <p>maximizing the organization’s value</p> Signup and view all the answers

    A firm will only receive a loan if creditors believe it can pay back the principal and ______.

    <p>interest</p> Signup and view all the answers

    Match the following business roles with their responsibilities:

    <p>Business Owners = Expect a reward for investment Employees = Conduct business operations Managers = Manage and coordinate employee tasks Suppliers = Provide necessary products or services</p> Signup and view all the answers

    Which of the following is NOT a factor in attracting and retaining customers?

    <p>Free shipping options (B)</p> Signup and view all the answers

    The performance of an organization depends solely on its internal resources.

    <p>False (B)</p> Signup and view all the answers

    What is the relationship between stock and ownership in a business?

    <p>Stock represents certificates of ownership.</p> Signup and view all the answers

    Creditors are typically financial institutions or individuals who provide ______.

    <p>loans</p> Signup and view all the answers

    What is one common requirement for expanding a business?

    <p>Increasing ownership through investments (A)</p> Signup and view all the answers

    Study Notes

    Course Information

    • Course title: BBA-PT XXXV Business Management
    • Instructor: Milaika Capella Ras, MBA
    • Email: [email protected]
    • Session 1 date: January 15, 2025
    • Location: Inter-Continental University of the Caribbean

    Important Dates

    • Extra classes: Thursday January 23, Thursday February 6
    • No class: Monday January 27, 2025
    • Midterm: January 29, 2025; Chapters 1, 3, 7; 6PM SHARP; no class after the midterm
    • Final Exam: February 12, 2025; Chapters 8, 10, 15 & 16; 6PM SHARP

    Chapter 1: Prepare for the Road Ahead

    • Topic: Motives and Functions of a Business
    • Outline:
      • Goal of a business
      • Resources
      • Stakeholders
      • Business environment
      • Business decisions

    Value of a Business

    • Outline of topics:
      • Organization of a business
      • Business environment
      • Management
      • Managing Employees
      • Marketing
      • Accounting and Financial Management
      • Special Topics

    What is a Business?

    • Definition: A profit-seeking organization that provides products or services desired by customers.
    • Profit factors:
      • Demand for the product/service
      • Ability to attract customers
      • Expenses

    Goal of a Business

    • Main reason: Profit
    • Profit equation: Revenue - Expenses = Profit/Loss
    • Revenue: Money brought in through the sale of goods and services
    • Expenses: All costs involved in doing business

    Business Decisions

    • Product: What type of product should be produced?
    • Production: How should the product be produced?
    • Promotion: How should the product be promoted?
    • Financing: How should the company obtain funds to finance the cost of producing the product?

    Decision to Create a Business

    • How to produce the product (Management Decision)
    • How to market and price products (Marketing Decision)
    • How to finance the business

    Nonprofit Business

    • Definition: An organization that serves a specific cause and is not intended to make profits; profits are reinvested in the organization.

    Resources

    • Natural resources: Minerals, water, wind, oils
    • Human resources: Employees
    • Capital: Machines, equipment, tools, and physical facilities
    • Entrepreneurship: The creation of business ideas and the willingness to take risk

    Impact of Technology

    • Technology: Knowledge or tools used to produce products and services
    • Information technology: Technology enabling information to be used to produce products and services
    • E-business/e-commerce: Use of electronic communications (e.g., internet) to produce or sell products and services.

    Advantage Technology/e-commerce

    • Improved efficiency (quicker production, higher quality)
    • Improved communication with customers
    • Improved information flow
    • Complemented traditional business operations

    Stakeholders

    • Types: Business owners/shareholders, entrepreneurs, co-owners, stockholders, creditors, employees, managers, suppliers, customers
    • Definition: People with an interest in, or affected by, a business

    Business Owners

    • Creating/expanding a business: Funds required for growth; co-owners may be needed
    • Stockholders/shareholders: Investors who buy stock or invest capital (owners or co-owners)
    • Responsibility of the firm: Return on shareholders' investment

    Creditors

    • Definition: Financial institutions or individuals that provide loans
    • Components of debt: Principal (amount borrowed) plus interest
    • Loan criteria: Creditor reliance on the firm’s repayment capacity

    Employees

    • Definition: People hired to conduct business operations
    • Managers' responsibility: Managing and coordinating employees' tasks; making decisions to achieve organizational goals; maximizing the organization's value.

    Suppliers

    • Definition: Individual or organization supplying needed products or services
    • Important factor: Timely delivery (for effective business performance)

    Customers

    • Importance: Attracting and retaining customers through desired products/services, reasonable pricing, and adequate quality

    Interaction among Stakeholders

    • Circular flow of business (owners investing capital, employees running the business, creditors lending money, customers buying products)

    Creating a Business Idea

    • Steps: Identify competitive advantage, differentiate from competitors, determine necessary resources , assess feasibility

    Business Environment

    • Components: Social, economic, technological, competitive, legal and regulatory, and global

    Key Functions of Business

    • Management: Managing resources and employees; means by which employees and resources are used by the business.
    • Marketing: Developing, pricing, and promoting products and services
    • Finance: Obtaining and using funds for firm operations

    Other Functions of Business

    • Accounting: Summarise and analyses financial status
    • Information Systems: Provide appropriate information for effective decision making.

    How Business Decisions Affect a Firm's Earnings

    • Connection of management, production, marketing, and finance decisions to revenue, expenses, and profit.

    Common Business Decisions

    • Management decisions: Determining needed equipment and employee numbers; motivating employees
    • Marketing decisions: Setting prices, making product more appealing
    • Finance decisions: Obtaining capital; short-term or long-term borrowing; investing in new projects

    Business Plan

    • Description: Detailed description, product/service description, customer types, competition, production facilities.

    Developing a Business Plan

    • Assess the business environment: economic, industry, global
    • Develop the management plan: Organizational structure, production, human resources
    • Develop the marketing plan: Target market, product characteristics, pricing, distribution promotion
    • Develop the financial plan: Financing and feasibility
    • Assess the business plan: Potential revenues, potential demand, potential expenses and profit potential.

    Case 1: Apple (on Moodle)

    • Case study on Apple's business practices

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    Description

    Test your knowledge on the motives and functions of a business with this quiz based on Chapter 1 of the BBA-PT XXXV course. Topics include business goals, resources, stakeholders, and the business environment. Prepare to reinforce your understanding before your midterm exam!

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