Study Guide and Quiz Answers

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1
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What does a company's customer service department do?

A
Promote the company to new groups of potential customers.
B
Interact with customers after they have purchased the product.
C
Receive payments from customers and handle the company's money.
D
Handle employee-related procedures.
2
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____________ is a way to turn a company into a parent company with smaller retail outlets owned by independent operators.

A
Manufacturing
B
Incorporating
C
Taxing
D
Franchising
3

Which of the following types of business ownership has the highest personal liability risk?

A
A partnership
B
A sole proprietorship
C
A C corporation
D
An LLC
4

Eggs, toilet paper, and candy bars are examples of __________.

A
Specialty goods
B
Convenience goods
C
Shopping goods
D
Unsought goods
5

Which of the following types of business ownership has the advantages of pass-through taxation and liability protection?

A
A sole proprietorship
B
An LLC
C
A C corporation
D
A partnership
6

Which of the following business ownership structures offers the best liability protection but higher taxes?

A
A nonprofit corporation
B
A C corporation
C
A partnership
D
A sole proprietorship
7

A corn farm, a coal mine, and a fishing company are all part of the _________ industry.

A
Manufacturing
B
Service
C
Extractive
D
Retailing
8

Which of the following business ownership structures is the simplest and easiest to set up?

A
A partnership
B
An LLC
C
A sole proprietorship
D
A C corporation
9

A company is usually unable to take advantage of economies of scale during the __________ stage of the product life cycle.

A
Saturation
B
Introduction
C
Growth
D
Maturity
10

What does a wholesaling company do?

A
Sell products to individual consumers
B
Sell products to companies that plan to resell them
C
Manufacture products and sell them to retail companies
D
Transform land into capital

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