MGTA03 - Introduction to Mnagement I
Practise Exam
Based on material from Chapters 1-4, 6-8, and 10
27 MCQs and 10 SAQs
Part 1 - 27 Multiple Choice Questions
1. If I ran a business in a capitalistic economy, I:might make a profit.
need to deal with government officials who are politically appointed.
could only run a small business.
would be a government employee.
would pay no taxes.
2. An economy might be a:market economy where the Ministry of Marketing sets prices.
command economy, in which exchanges between buyers and
sellers are uncontrolled.mixed economy, which has characteristics of both command
and market economies.socialist economy, where professions are assigned to students
as they get ready to work for the government.kibbutz economy.
3. Private enterprise is good for you as a consumer because it gives you:the right to profit.
the opportunity to compete.
freedom of choice.
the benefits of competition.
freedom of choice and the benefits of competition.
4. If the Canadian economy became unstable because Quebec separated, the immediate threats that you might have to deal with would include:high rates of inflation.
prices for your products would be difficult to change.
a recession caused by rapidly increasing prices.
a depression with dropping sales and employment.
structural employment.
5. In examining Canada's economy, one could say that:
Canada's balance of trade is favourable.our annual deficit is larger than the national debt.
GDP carefully measures Canada's free natural resources like
our forests.our balance of trade is negative with the United States.
fiscal policy manages interest rates.
6. Governments in Canada have widespread influence because they:
tax.
compete.
regulate.
provide services.
all of the above.
7. If you decide to start your own business you have:
three choices: sole proprietorship, partnership, and incorporation.only two choices: sole proprietorship and incorporation.
the choice assigned to you by the Provincial Registrar's office.
a range of choices including forming a cooperative.
none of the above.
8. Sole proprietorships are:an old form of operation.
simple.
risky.
a problem if the owner dies.
all of the above.
9. You and your best friend decide to start a business and are careful to write a good partnership agreement specifying:
that profits are limited.that if a partner dies, the heirs can take over the business.
the relationship with Revenue Canada.
who invested what, and who does what.
one thing only: how the partnership can be dissolved.
10. You establish your new business as a corporation and it can:be sued.
make products.
commit crimes.
be private or public.
all of the above.
11. Canada's balance of trade is:
favourable at this time.
offsets the unfavourable balance of payments.
reflects the low Canadian dollar.
is largely from trade to the U.S.
all of the above.
12. The balance of payments includes:
exports.
exports and foreign tourist spending.
exports, foreign tourist spending, and foreign investment in
Canada.exports, foreign tourist spending, foreign investment in Canada,
and overseas exports.exports-imports.
13. If the value of the Canadian dollar rises you, as an importer, need to understand that:
the rate of exchange has changed.
the ratio of investment to exports has changed.
Americans can buy Canadian goods more cheaply.
the Euro will change in value.
all of the above.
14. As a resident of Canada you need to be aware of the role of exports in our economy. If fact, they are:
central to Canada's economy.
the counterweight to unfavourable payments balances.
as much as 90% of some companies activities.
something that can be done through an independent agent.
all of the above.
15. The control process includes:
determining what the business needs to do.
measuring performance.
mobilizing the necessary resources to complete a particular task.
designing tactical and operational plans.
giving orders and demanding results.
16. The functional structure:
develops employees and clarifies their career paths.
is the oldest organizational structure.
is the most common organizational structure.
eliminates duplication.
All of the above.
17. As a recruiting officer:
you will increase company expenses.
your job is to create the pool of candidates.
you will constrained by legislation.
you will use schools, newspapers, and employment agencies.
All of the above.
18. Selection:
is done by the human resource department, not the hiring manager.
can use skill tests to make good predictions of personality content.
uses job descriptions.
is not affected by legislation.
creates the best pool of candidates.
19. Interviews:
are part of recruiting.
are assessment centres.
have poor validity.
need to be validated using video assessments.
are best for a small company because they are cheap and accurate.
20. The basic fact of small business is that:
99% of all businesses have fewer than 500 employees.
most small businesses are larger than 50 people.
they create few jobs because they are so small.
they copy the products of big business and do not innovate.
they are backed by banks, not owners' capital.
21. People who are entrepreneurs start a small business:
just to make money.
because they want to be their own boss.
for the challenge and the sense of achievement.
to satisfy their family.
both b and c are correct.
22. You are considering taking over your family's small business. You may encounter:
disputes about control.
difficulties in pricing it when it is passed from parent to child.
conflicting priorities.
all of the above.
none of the above.
23. If you want to start a small business you need to be realistic and be aware that survival of a small business:
is a given, most of them make it through the first 10 years.
is more probable for men than for women.
is obviously impossible since none of them survive past three years.
is not easy — half of them never make it past three years.
is helped in Canada by the Small Business Support Act.
24. Comparable worth means:
my benefits should be roughly the same value as my pay.
if my job is of the same value to the company as someone else's job in the company, then both jobs should be paid the same.
if I work as hard as the person beside me, I should receive the same pay.
that my benefits should be from the same cafeteria as the benefits of everyone else in the company.
only jobs that have the same responsibilities should be paid the same.
25. An important part of an organization’s training and development program is new employee orientation. Orientation is the process of:
introducing new employees to policies and programs.
introducing new employees to the nature of the job.
making newcomers feel like part of the team.
introducing new employees to personnel with whom they will interact.
All of the above.
25. A benefit that is growing in popularity that concentrates on preventing illness in employees rather than simply paying their expenses when they become sick is called:
a comparable worth benefit.
a compassionate care benefit.
personal leave.
a wellness program.
a cafeteria-style benefit plan.
25. In your new department, if you decided to use the two-factor theory as a guide you would:
worry about the motivation factors, not the hygiene factors.
carefully design jobs so that the hygiene factors are built into the responsibilities.
use the motivators to establish true equity.
ensure that the hygiene factors are acceptable.
consider the expectancy curve when applying the motivation factors.
26. Low morale is likely to lead to:
job dissatisfaction.
high absenteeism.
greater turnover.
more reported illnesses.
All of the above.
27. According to Maslow, which need is addressed by a promotion with no increase in pay?
self-esteem
physiological
security
social
self-actualization
Part 2 - 10 Short Answer Questions
Question 1
Is the Canadian economy considered to be a capitalist economy, a socialist economy, a mixed economy or communist economy? Explain and justify your answer.Question 2
Explain the difference between a General Partner and a Limited PartnerQuestion 3
Professor Borins, who is Chris Bovaird’s boss, stops by Chris’ office every now
and again. He pops his head in says “hi” and asks a question about some course
or project that Chris is working on. As a result, Chris feels important. What
important work in the theory of motivation is Professor Borins putting into practice?Question 4
Identify the market structure of the Canadian banking industry. You must explain and justify your response. 4 marksQuestion 5
The Senior Management of XYZ company are discussing ways to improve employee motivation. Mr. Patel, the Production Manager, suggests that the company spend more money on the food served in the company cafeteria. Mrs. Jeffery, the Marketing Manager suggests that the same amount of money could be spent to allow company staff to take courses and seminars. Mr. Bovaird, the Human Resources Manager, says "I know a thing or two about Human Resources and motivation. People will always complain about the food. But an investment in personal development will have a long term effect on their motivation. I agree with Mrs. Jeffery."Question 5a What theory or model supports Mr. Bovaird's view
Question 5b Explain and justify your answer.
Question 6a
Identify the four types of competition. 2 marksQuestion 6b
Name an industry or a product which you consider to be a good example of
each type of competition. Explain and justify your examples. 8 marksQuestion 7
Give example of industry or produict that is sold in a monopolistically competitive industry. Explain and justify your answer by identify at least four features of a monopolistic competition.
Question 8
Explain why a partnership agreement is normally considered to be a good thing to have in a partnership.
Question 9
Identify the 4 principal Barriers to Trade, explain them, and give an example of of a country, a product or an industry that faces a barrier to trade.
Question 10
Identify 5 distinct absolute or comparative advantages which make automobile and auto part manufacturing one of Canada’s largest export industries.
Answers
Answer 1
Cdn economy is mixed economy. Private enterprise exists along saide a small amount of government intervention, primarily through regulation and taxation.
Answer 2
General partner – involved in management and operations of business, has personal liability, has unlimited liability, has joint and several liability with other partners (if any).Limited partner – not involved in management and operations of business, contributes only money, has no personal liability, liability limited to amount of money invested, no joint and several liability with other partners.
Answer 3
Professor Borins was putting into practice the management technique revealed by the Hawthorne experiments. He was showing an interest in his emploiyee, and making Mr. Bovaird feel interesting and important.Answer 4
The Canadian banking industry is an Oligopoly 1 mark
Because:
Small number of suppliers (6 main banks = 95% market share) 1 mark
Each bank is large for each
There are barriers to entry: large capital needs relevant
economies of scale characteristic
Answer 5a
Herzberg's Motivation - Hygiene TheoryAnswer 5b
Herzberg found that things that cause satisfaction and at work and things that caused dissatisfaction at work were not the same. Hygiene Factors reduce dissatisfaction when present to an acceptable degree, but do not necessary result in high levels of motivation. Motivation factors are job factors which increase motivation, but whose absence does not necessarily result in dissatisfaction. When, in the example, Mr. Bovaird says that "people will always complain about the food" he is identifying the quality of the cafeteria food as a hygiene factor. Improving the menu in the cafeteria might have a short-term impact on employees' attitudes but is not necessarily a long-term motivator. Financing off-the job training and education, on the other hand, allows the employees to advance and grow in their lives and jobs. This personal advancement is a motivation factor, which will result in long term improvements to employee motivation.Or
Answer 5a
Maslow’s Hierarchy of NeedsAnswer 5b
Getting adequate cafeteria food may be satisfying their physiological needs. Getting more or better food won’t necessarily motivate them.Getting an education may appeal to their esteem or self-actualisation needs (higher order needs) and will motivate them.
Answer 6a
Pure or perfect competition; monopolistic competition; oligopoly; monopoly
Answer 6b
Pure or perfect competition: any industry or product which is correctly identified as being supplied by a large number of small suppliers, none of which has any power to differentiate its product or deviate from the market price.monopolistic competition: any industry or product which is correctly identified as being supplied by a large number of suppliers, most of which are small and have a small no power to differentiate their product or deviate from the market price. However, there are some suppliers which are able to differnetiate their product and charge a higher price - probably through branding.
oligopoly: any industry or product which is correctly identified as being supplied by a small number of large suppliers, each of which has some power to differentiate its product
monopoly: any industry or product which is correctly identified as being supplied by only one supplier, which has virtually unlimited abilty to set its own price.
Answer 7
The attributes of an industry that is “Monopolistically Competitive” are:- lots and lots of suppliers
- most of them small
- most more or less the same
- some are big, can differentiate themselves
- most sell at the same price
- a few can charge a little extraExamples might include: ordinary coffee shops vs. Starbucks, no-name tee-shirts vs. Nike sporting wear, PC clones vs. IBM PCs. Any industry in which the competition has the above attributes will do.
Answer 8
What it is: A partnership agreement is an agreement among the partners (NOT between the partners and any outsiders).What it contains: It is an attempt, up front, to clarify: who does what, who puts in how much money, how much everyone gets paid, how to share the profits, etc. etc.
Why have one: A partnership agreement is desirable because it is an attempt to anticipate and forestall any disagreements or misunderstandings between people who must work together. The agreement provides a clear set of rules.
Answer 9 - Barriers
There are several different kinds of barrier to trade. Principle types are: Tariffs, Quotas, Embargos and Subsidies
Tariffs: A tax or fee levied on imported products
Examples: Canada puts tariffs on various “luxury” goods such as imported French perfumes, wines from any wine exporting country (e.g. France, Italy, Australia, Germany, South Africa), cigars from Cuba, and whiskey from Scotland.
Quotas: Limit to amount of a particular good that may be imported into a country during a given period of time.
Examples: U.S. used to impose import quotas on Japanese cars. U.S. now putting quota on Canadian softwood lumber exports
Embargos: Complete halt to trading with a particular nation or particular market.
Examples: American embargoes against trade with Cuba; Most Commonwealth countries placed embargoes on trade with South Africa during its Apartheid era; Canada has an embargo on the trade in products involving endangered species (e.g. it is illegal to import ivory into Canada); because of mad-cow disease the US recently embargoed the import of Canadian beef.
Subsidy: A payment, by the government, to help local firms compete against foreign firms.
Examples: France and other EU countries subsidise small, traditional farmers
Answer 10
The answer should make reference to competitive advantage, specifically absolute advantage.Canadians have a competitive advantage at making cars. Canada in general, and Canadian workers specifically, have certain absolute advantages over most other workers in most other countries.
The list of advantages would include:
The raw materials (iron, copper, zinc, aluminum) come from N. Ontario;
Steel comes from Hamilton;
Ontario provides a highly educated work force;
We have lots of financial capital ($$$)
We have lots of land located near urban centres;
We have transportation/communication networks
We are close to the market (USA).