Question 1

Stakeholders include customers, employees, stockholders, suppliers, dealers, bankers, government officials and environmentalists.

Accepted Answer

Stakeholders refer to individuals or groups who have an interest or concern in the activities and goals of a business, including but not limited to customers, employees, stockholders, suppliers, dealers, bankers, government officials, and environmentalists.

Question 2

Since all businesses make a profit, starting a business is not risky.

Accepted Answer

This statement is false. Starting a business involves a significant amount of risk and there is no guarantee of profits. Many new businesses fail within the first few years of operation, and even successful businesses can face unexpected challenges and setbacks that may affect their profitability.

Question 3

Risk is the chance an entrepreneur takes of losing time and money on a business that may not prove profitable.

Accepted Answer

This statement is true. Risk is inherent in entrepreneurship as it involves investing time, money, and effort in a business without knowing for sure whether it will succeed or not.

Question 4

An entrepreneur risks time and money to start and manage a business.

Accepted Answer

This statement is true. Entrepreneurs take on the risk of investing their time and money into starting and managing a business with the hope of making a profit.

Question 5

The knowledge and skills learned in business courses are seldom relevant to students who work for nonprofit organizations or volunteer groups.

Accepted Answer

While some specific business skills, such as finance and marketing, may not be directly applicable to nonprofit organizations or volunteer groups, many foundational skills and knowledge, such as management, leadership, and communication, are still relevant and valuable. Additionally, many nonprofit organizations operate similarly to for-profit organizations in certain aspects, such as budgeting and strategic planning, making business knowledge useful in these areas as well.

Question 6

If a business's costs and expenses are greater than its revenue, it will suffer a loss.

Accepted Answer

This statement is true. A business needs to earn more revenue than the costs and expenses it incurs in order to be profitable. If the costs and expenses exceed the revenue, the business will suffer a loss.

Question 7

"Insourcing" refers to the practice of global companies setting up design and production facilities in the United States.

Accepted Answer

Insourcing involves bringing production and other business activities back to a company's domestic country, so companies are setting up facilities in the United States for this purpose.

Question 8

Maintaining a high quality of life requires the combined efforts of businesses, nonprofit organizations, and government agencies.

Accepted Answer

Maintaining a high quality of life involves various aspects such as economic growth, social well-being, environmental sustainability, and effective governance, which require collaboration and cooperation among different sectors including businesses, nonprofit organizations, and government agencies.

Question 9

Outsourcing has caused many complications in many states where jobs have been lost to overseas companies.

Accepted Answer

Outsourcing of jobs to overseas companies has led to many job losses in various states, causing complications and unemployment issues.

Question 10

Revenue is the total amount of money a business takes in during a given period by selling goods and services.

Accepted Answer

This statement is true. Revenue is the total amount of money a business earns from its sales of goods or services during a specific time period. It is calculated by multiplying the number of units sold by the price per unit.

Question 11

Profits of a business include the salaries paid to its employees.

Accepted Answer

The answer of Profits of a business include the salaries...

Question 12

Outsourcing means selling goods and services to people in other countries.

Accepted Answer

Outsourcing means contracting work or services to an external company or party, regardless of whether they are located in the same country or not. It does not necessarily involve selling goods or services to people in other countries.

Question 13

Businesses seek to earn a profit by providing goods and services to others.

Accepted Answer

This is a fundamental principle of business. Businesses exist to serve consumer needs and make a profit in the process.

Question 14

Profit is the amount of money a business earns above and beyond what it spends for salaries and other expenses.

Accepted Answer

Profit is the surplus money left over after all expenses and salaries have been paid.

Question 15

Health care availability, a clean environment, and good schools all contribute to a high quality of life.

Accepted Answer

These factors are commonly cited as important to a high quality of life.

Question 16

The term "standard of living" refers to the amount of debt people can incur on a given income.

Accepted Answer

The term "standard of living" refers to the level of comfort, material goods, and necessities that individuals or groups can afford based on their income and wealth, not the amount of debt they can incur.

Question 17

Revenue is the amount a business earns above and beyond what it spends for expenses and costs.

Accepted Answer

The answer of Revenue is the amount a business earns...

Question 18

Stakeholders are all the people who stand to gain or lose by the policies and activities of a business.

Accepted Answer

This is correct definition of stakeholders.

Question 19

The United States has one of the highest standards of living in the world.

Accepted Answer

The United States has a high standard of living compared to many other countries in the world.

Question 20

Often the needs of a firm's various stakeholders will conflict.

Accepted Answer

The needs and desires of a firm's stakeholders can often be diverse and conflicting, such as shareholders wanting high profits while employees may want better benefits or job security.

Quiz 1: Taking Risks and Making Profits Within the Dynamic Business Environment