Test Bank for Business in Action, 10th edition by Courtland L. Bovee
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Module
Business Communication
Institution
Business Communication
Test Bank for Business in Action 10e 10th edition by Courtland L. Bovee, John V. Thill. Full Chapters test bank are included - Chapter 1 to 16
PART 1: SETTING THE STAGE: THE BUSINESS OF BUSINESS
Developing a Business Mindset
Economics, Money, and Banking
The Global Marketplace
Business Ethic...
Business in Action, 10e (Bovee/Thill)
Chapter 1 Developing a Business Mindset
1) ________ is money that an organization brings in through the sale of its goods and services.
A) Competitive advantage
B) Revenue
C) Sales
D) Capital investment
Answer: B
Explanation: Revenue is the money a company brings in through the sale of goods and services.
Difficulty: 1: Easy
AACSB: Application of knowledge
LO: 1.1: Explain the concept of adding value in a business, and identify four useful ways to
categorize businesses.
2) Why is the link between risk and reward critical for a business?
A) It is a key aspect of social responsibility
B) It provides opportunities for not-for-profit organizations to stay in business
C) It is essential to the counter-cyclical business model
D) It provides incentive to take on the risk
Answer: D
Explanation: Without the promise of rewards, businesses would have no incentive to take on
the risks. And without entrepreneurs and companies willing to accept risk, little would get done
in the economy.
Difficulty: 2: Moderate
AACSB: Application of knowledge
LO: 1.1: Explain the concept of adding value in a business, and identify four useful ways to
categorize businesses.
3) A(n) ________ is a framework of how a business intends to generate revenue.
A) business model
B) strategic management tool
C) profitability analysis
D) competitive advantage
Answer: A
Explanation: A company's business model is a clear, simple outline of how the business intends
to generate revenue.
Difficulty: 1: Easy
AACSB: Analytical thinking
LO: 1.1: Explain the concept of adding value in a business, and identify four useful ways to
categorize businesses.
1
, 4) ________ is the term used to describe the difference between revenue and expenses.
A) Profit
B) Interest
C) Sales
D) Owner's equity
Answer: A
Explanation: Profit is the amount of money left over after all the costs involved in doing
business, have been deducted from revenue.
Difficulty: 1: Easy
AACSB: Application of knowledge
LO: 1.1: Explain the concept of adding value in a business, and identify four useful ways to
categorize businesses.
5) ________ refers to some aspect of a product or company that makes it more appealing to
target customers.
A) Competitive advantage
B) Economies of scale
C) Horizontal integration
D) Vertical integration
Answer: A
Explanation: Competitive advantage refers to some aspect of a product or company that makes
it more appealing to target customers.
Difficulty: 2: Moderate
AACSB: Application of knowledge
LO: 1.1: Explain the concept of adding value in a business, and identify four useful ways to
categorize businesses.
6) Which type of organization seeks to operate efficiently and effectively to achieve its goals
without focusing on profit as a motive?
A) Business intermediary
B) Nonprofit organization
C) Service business
D) Goods-producing business
Answer: B
Explanation: Not-for-profit organizations (also known as nonprofit organizations) such as
museums, most universities, and charities do not have a profit motive.
Difficulty: 2: Moderate
AACSB: Application of knowledge
LO: 1.1: Explain the concept of adding value in a business, and identify four useful ways to
categorize businesses.
2
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