AFM 131 Quiz #1

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Questions and Answers

What is meant by 'economies of scale' in production?

Increased production leading to increased overall costs.

Decreased workforce resulting in higher production costs.

Reduction in the cost per unit as production increases. (correct)

Equal cost of production regardless of output level.

Which cycle is characterized as the highest point of economic activity?

Peak (correct)

Trough

Expansionary

Contraction

How does fiscal policy primarily influence the economy?

Through the management of private sector investments.

Through changes in tax rates and government spending. (correct)

By regulating the money supply and interest rates.

By assessing environmental impacts on businesses.

What does the Consumer Price Index (CPI) measure?

The average change in prices for a fixed basket of commonly purchased goods. Signup and view all the answers

What characterizes a depression in economic terms?

A long duration of declining economic activity. Signup and view all the answers

Which of the following defines national debt?

The total accumulated deficits the government incurs over time. Signup and view all the answers

What does the acronym PEST stand for in business analysis?

Political, Economic, Social, and Technological factors. Signup and view all the answers

What is meant by macroeconomics?

The examination of economy-wide phenomena such as inflation and unemployment. Signup and view all the answers

What does the term 'switching costs' refer to?

The financial and psychological costs involved in changing suppliers Signup and view all the answers

Which of the following is NOT one of Porter's five forces?

Market price elasticity Signup and view all the answers

What does the 'triple bottom line' emphasize in corporate reporting?

Social, economic, and environmental performance Signup and view all the answers

What characterizes a recession?

Two or more consecutive quarters of GDP decline Signup and view all the answers

What is the primary focus of Corporate Social Responsibility (CSR)?

Enhancing the welfare of society and the environment Signup and view all the answers

Which of the following best defines 'stakeholders'?

Individuals or entities with an interest in an organization's activities Signup and view all the answers

What does a social audit evaluate?

Progress towards social responsibility goals Signup and view all the answers

Which of the following is an example of corporate philanthropy?

Donating funds or skills to charitable causes Signup and view all the answers

What is the primary goal of marketing?

To create, communicate, and deliver value to customers. Signup and view all the answers

Which of the following best describes penetration pricing?

Setting a low initial price to build a customer base. Signup and view all the answers

What is the purpose of product differentiation?

To make a product unique compared to competitors. Signup and view all the answers

Which stage of the product life cycle typically sees a product's highest sales?

Maturity stage. Signup and view all the answers

Which component is NOT part of the promotion mix?

Market research. Signup and view all the answers

What is the primary aim of relationship marketing?

To develop long-term customer loyalty. Signup and view all the answers

Which term refers to a group of similar products offered by a company?

Product line. Signup and view all the answers

What is test marketing primarily used for?

To gather customer feedback on a new product. Signup and view all the answers

What does brand equity primarily rely on?

Customer loyalty and awareness Signup and view all the answers

What is the primary purpose of break-even analysis?

To evaluate profitability and identify the break-even point Signup and view all the answers

In business-to-business (B2B) sales, which of the following is true?

It involves companies that may not be end users Signup and view all the answers

What is buzz marketing designed to do?

Encourage customers to share their product experiences publicly Signup and view all the answers

Which statement best describes crowdsourcing?

Mobilizing the ideas of individual customers to design a product Signup and view all the answers

What is a key component of customer relationship management (CRM)?

Capturing data to enhance customer engagement Signup and view all the answers

What does market segmentation aim to achieve?

Dividing a total market into distinct customer segments Signup and view all the answers

What differentiates primary research from secondary research?

Primary research involves surveys and interviews, while secondary research includes published data Signup and view all the answers

What is the primary purpose of coaching within an organization?

To support emerging leaders with their goals Signup and view all the answers

Which of the following best defines contingent workers?

Workers who engage in short-term projects Signup and view all the answers

What is a compressed workweek?

Working required hours over fewer days for longer weekends Signup and view all the answers

What do fringe benefits refer to in an employment context?

Optional benefits that help attract and retain employees Signup and view all the answers

What is the primary focus of employee retention strategies?

To reduce employee turnover Signup and view all the answers

Which term describes the process of providing orientation for new employees?

Onboarding Signup and view all the answers

What does the employee lifecycle (ELC) encompass?

The complete journey of an employee in a company from start to finish Signup and view all the answers

What is the main characteristic of flextime plans?

Employees can choose their hours outside of core hours Signup and view all the answers

What is the purpose of job rotation in an organization?

To provide exposure to different areas and develop future leaders. Signup and view all the answers

How does off-the-job training benefit employees?

It provides a comfortable learning environment away from daily pressures. Signup and view all the answers

What does pay equity assess?

It evaluates equal pay for work of equal value based on neutral factors. Signup and view all the answers

What is the main feature of a telework arrangement?

Employees work remotely while maintaining connectivity through technology. Signup and view all the answers

What do performance appraisals evaluate?

Actual performance against established standards. Signup and view all the answers

What is the purpose of profit sharing in a company?

To create an incentive based on company performance targets. Signup and view all the answers

Which statement best describes job simulations?

Using equipment to replicate job conditions for safe learning experiences. Signup and view all the answers

What is the turnover rate in a company?

The percentage of employees that leave the company each year. Signup and view all the answers

Study Notes

Unit 3

Benchmark interest rate: The rate at which the Bank of Canada loans money to Canadian financial institutions.
Business cycles: Economic activity fluctuates over time, with phases of expansion, peak, contraction, trough, and recovery. The duration and severity of each cycle can vary.
Consumer Price Index (CPI): Measures the change in prices of a basket of commonly purchased goods and services like food, housing, transportation etc.
Depression: A severe recession marked by long-term decline in economic activity.
Deregulation: Removal of laws and regulations that reduce competition
Economies of scale: Benefits of producing more units; costs per unit decrease as production increases.
Environmental scan: Evaluation of factors that could impact a business's success.
Factors of production: Land, labor, capital, entrepreneurship, and knowledge needed for production.
Fiscal policy: Government actions using taxes and spending to regulate economic stability.
Gross Domestic Product (GDP): Total value of final goods and services produced within a country in a year.
GDP per capita: GDP divided by the population; indicates average national income.
Inflation: Increase in prices of goods and services over time.
Macroeconomics: Study of whole economy (e.g., employment, interest rates, inflation).
Microeconomics: Study of individual economic choices and decisions in the economy.
Monetary policy: Government actions to manage money supply and interest rates.
National debt: Sum of government deficits accumulated over time.
PEST: Analysis of Political, Economic, Social, and Technological factors impacting organizations.
Porter's five forces: Framework for assessing competition, new entrants, supplier/customer power, and substitutes.
Recession: Two consecutive quarters of declining GDP.
Stakeholders: Individuals or groups with interests connected to an organization.
Switching costs: Costs of changing from one product/supplier to another.
SWOT: Analysis of organizational strengths, weaknesses, opportunities, and threats.
Triple bottom line reporting: Corporate reporting on social, environmental, and economic performance.
Unemployment rate: Percentage of unemployed people in the labor force.
Corporate philanthropy: Businesses donating money or resources to charities.
Corporate Social Responsibility: Businesses acting responsibly towards society
Ethical dilemma: difficult decision with no obvious desirable outcome
Ethics: Guiding principles for decision-making
Fair trade: Ensuring fair prices for products from developing countries
Laws: Established regulations governing actions in a jurisdiction
Social audit: Evaluating an organization’s social responsibility practices
Sustainable development: Meeting current needs without compromising future generations’ needs

Unit 4

Leadership styles:
- Autocratic: Leaders make decisions without consulting anyone.
- Democratic: leaders work collaboratively with their employees when making decisions.
- Laissez-faire: Managers set the goals, but employees are free to implement them.
Maslow's hierarchy of needs: Motivation theory: Physiological needs (basic), safety, belonging, esteem, and self-actualization.
Mission statement: An organization’s purpose and what they intend to do
Organizational chart: Graphic depiction of the organizational structure
Values: Fundamental beliefs guiding an organization
Vision: Description of an organization's desired future
Advertising: methods of promoting a brand or product to a general audience
Brand: Name, symbol, or design associated with a product or organization
Brand equity: Overall value of a brand based on its awareness and customer loyalty
Break-even analysis: Calculating the point at which revenue equals costs (to determine profitability)
B2B/B2C: Business-to-business and business-to-consumer sales
Buzz marketing: Encouraging consumers to engage with a product/service through social media or word-of-mouth
Concept testing: Gathering feedback on a new product idea from potential customers
Crowdsourcing: Using ideas and feedback from many people to improve a product, service or process.
Customer Relationship Management (CRM): Systems for managing interactions with customers
Direct marketing: One-on-one communication with customers through direct channels
Distributions channel: Series of entities that transfer products from manufacturer to consumers

Unit 5 (and 8)

Market segmentation: Dividing a market into groups of customers based on shared characteristics.
Marketing: Activities involved in creating, communicating, and delivering a product or service to customers.
Marketing mix (4Ps): Product, price, place, and promotion decisions to create effective marketing strategies.
Mass marketing: Reaching a large target market with a single product offering.
Penetration Pricing: Initial low pricing to attract customers in competitive markets
Personal selling: Direct interaction with potential buyers to build relationships and close sales.
Price skimming: Initial high pricing, later reducing price as the market matures.
Product differentiation: Creating unique features or benefits for a product to stand out from competitors.
Product life cycle: Phases of growth and decline for a product. Include introduction, growth, maturity, and decline stages.
Product line: Group of similar products offered by a company.
Product mix: Total collection of product lines offered by a company.
Promotion mix: Combination of tools used to promote products and brand (advertising, public relations, personal selling, direct marketing).
Public relations: Creating a positive image and publicity for a company.
Relationship marketing: Developing long-term relationships with customers to build customer loyalty.
Sales promotions: Incentives like coupons or discounts to encourage immediate sales.
Target market: Specific group of customers that a company aims to target and their needs.
Test marketing: Launching a product in a limited area to test its response before full launch.

Unit 10

Apprenticeship programs: Training programs providing practical experience and skills to aspiring employees.
Bonus plans: Additional rewards or compensation for exceeding performance targets or goals.
Cafeteria-style benefits: Allow employees to select benefits that best suit their needs.
Coaching: Mentoring and guidance offered to develop employee skills.
Commission plans: Compensation based on a percentage of achieved sales.
Compensation: Total wages and salaries/benefits provided to employees.
Compressed workweek: Working required hours over fewer days.
Contingent workers: Temporary employees hired for short-term needs.
Employee lifecycle (ELC): Stages of employment from recruitment through onboarding, evaluation, and termination/retention
Recruitment: Process of finding qualified applicants for job openings.
Onboarding: Transitioning new employees to the company culture and responsibilities.
Development: Enhancing employee skills and abilities through training and other experiences.
Retention: Keeping valuable employees with the organization.
Offboarding: Managing the departure of employees (both voluntary and involuntary).
Flextime plans: Flexible work hours
Fringe benefits: Non-monetary benefits provided to employees (health insurance, vacation time etc.).
Hourly wage: Compensation calculated per hour worked.
Job description: Detailed overview of job duties and responsibilities.
Job rotation: Moving employees between different departments to gain experience and skills.
Job simulations: Realistic exercises simulating job tasks to evaluate skills or train employees.
Off-the-job training: Training outside of the regular work environment.
On-the-job training: Training on the job by observing or working alongside experienced personnel.
Online training: Training programs accessible online.
Pay equity: Fair compensation for work of similar value regardless of gender, ethnicity etc
Performance appraisals: Assessing employee performance against organizational standards
Profit sharing: Sharing part of company profits with employees.
Salary: Fixed amount of compensation paid annually; sometimes adjusted annually based on merit or performance.
Stock options: Rights to purchase company stock at a set price, usually granted as compensation.
Telework/Telecommuting: Working from a location other than the workplace, such as at home
Turnover rate: Percentage of employees leaving a company each year
Understudy positions: Positions in organizations where workers develop skills and experience by aiding senior workers

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Description

This quiz covers key concepts from AFM 131, including benchmark interest rates, business cycles, and the Consumer Price Index. Test your understanding of fiscal policy, economies of scale, and more essential economic terms that impact businesses and markets. Perfect for those studying Economics at various levels.