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18 Jun 2013
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Chapter 1
Understanding the Canadian Business System
1)
In the story "Voisey's Bay", Inco bought controlling interest in the site upon discovery of one of the world's
richest nickel finds. There were delays in development of the site because:
A)
of a time-consuming and expensive environmental review process, along with difficult negotiations
with the government of Newfoundland
B)
Inco found a richer nickel mine in Malaysia
C)
the company could not make a profit
D)
Inco didn't have enough capital
E)
Inco closed its Newfoundland office
Answer:
A
Diff: 2
2)
Examples of businesses include the following, except:
A)
large corporations like Canadian Pacific or Alcan Aluminum
B)
local supermarkets
C)
non-profit organizations
D)
one-person businesses, like barbershops
E)
farms
Answer:
C
Diff: 1
3)
Deborah wants to set up a business, but also wants to be aware of the roles business should take. Which of
the following would Deborah not consider to be a role of business firms in the Canadian economy?
A)
regulate the marketplace with trade barriers
B)
provide employment for citizens
C)
provide community leadership
D)
provide profit incentive for business owners
E)
support charitable organizations
Answer:
A
Diff: 2
4)
Profit is:
A)
the level of expenses
B)
the amount of sales
C)
what remains after business expenses are subtracted from business revenues
D)
the value of shares in a company
E)
the taxes a company pays
Answer:
C
Diff: 1
5)
This week, Mary's Variety had sales of $4 000, employees were paid$1 000, cost of goods was $1 500, and rent
was $500. Profit for the week was:
A)
$3 000
B)
$4 000
C)
$1 000
D)
$1 500
E)
$2 000
Answer:
C
Diff: 2
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6)
Most of the goods and services consumed in Canada are produced by:
A)
the Canadian government
B)
overseas firms
C)
business firms
D)
countries of the Pacific Rim
E)
the U.S. economy
Answer:
C
Diff: 1
7)
An economic system is:
A)
the way in which a nation allocates its resources among its citizens
B)
a government decree that requires certain goods and services to be provided
C)
a large government department that oversees how the economy is running
D)
a long standing agreement between citizens and governments on how an economy is run
E)
an agreement between countries that deal with free trade
Answer:
A
Diff: 2
8)
Jose is from Guatemala. He is unsure about the nature of business in Canada. You point out that a typical
business in Canada operates the same as a typical business in:
A)
Japan
B)
England
C)
Peru
D)
France
E)
People's Republic of China
Answer:
B
Diff: 1
9)
All of the following are factors of production except:
A)
technology
B)
natural resources
C)
capital
D)
entrepreneurs
E)
labour
Answer:
A
Diff: 2
10)
Natural resources, as a factor of production for mining, is a practical consideration when a mining company
considers:
A)
the amount of capital required to build the mine
B)
the ease with which ore could be mined
C)
the number of miners available to mine the ore
D)
the number of customers who want to buy ore
E)
the profit that could be made from mining the ore
Answer:
B
Diff: 3
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11)
Natural resources include:
A)
land, water, and gasoline
B)
the funds needed to start and operate a business
C)
land, water, and mineral deposits
D)
a large number of people with entrepreneurial tendencies
E)
the mental and physical capabilities of people
Answer:
C
Diff: 1
12)
Labour includes:
A)
everyone in the business
B)
only non-unionized employees
C)
only workers who do physical work
D)
only managers
E)
only unionized employees
Answer:
A
Diff: 2
13)
A factor that contributes directly to improving labour as a factor of production is:
A)
creation of more manual-labouring jobs
B)
better education for more of the population
C)
free tuition at post-secondary educational institutions
D)
increased purchasing power by employees
E)
programs that decrease unemployment
Answer:
B
Diff: 3
14)
Susan wants to set up a small business. She should know that a major source of capital for most businesses,
especially small businesses, is:
A)
business revenue
B)
loans from banks
C)
investors
D)
personal investment
E)
short-term loans
Answer:
D
Diff: 1
15)
Marie owns a small restaurant and is thinking of expanding it to another location. She is best described as
a(n):
A)
capitalist
B)
administrator
C)
entrepreneur
D)
venture capitalist
E)
employee
Answer:
C
Diff: 1
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