ETS Major Field Test Business Study Set Latest Update 2024-2025 200 Questions and 100% Verified Correct Answers Guaranteed A+
(1) Convenience products, (2) Shopping products, (3) Specialty products, (4) Unsought
products - CORRRECT ANSWER: The types of Consumer Products include _____.
(1) people face trade-offs; (2) the cost of something is what you give up to get it; (3) rational people think at the margin; and (4) people respond to incentives. - CORRRECT ANSWER: The Principles of Economic Decision Making assume that:
(1) Product, (2) Place, (3) Price, and (4) Promotion - CORRRECT ANSWER: The 4 P's
of Marketing include:
(1) trade can make everyone better off; (2) markets are usually a good way to organize economic activity; and (3) governments can sometimes improve market outcomes. -
CORRRECT ANSWER: The Principles Concerning People's Economic Interactions
assume that:
14 General Principles of Management - CORRRECT ANSWER: Division of Labor,
Authority, Discipline, Unity of Command, Unity of Direction, Subordination of Individual Interests to the General Interest, Remuneration, Centralization, Scalar Chain, Order, Equity, Stability of Tenure of Personnel, Initiative, and Esprit de Corps
a series of corporate scandals involving Enron, WorldCom, Global Crossing, Tyco and
numerous others. - CORRRECT ANSWER: The Sarbanes-Oxley Act of 2002 (SOX)
was largely a response to:
Abraham Maslow - CORRRECT ANSWER: Hierarchy of Needs:
Proposes that individuals have a hiearchy of needs that need to be fulfilled in order.
The hierarchy includes: physiological needs, safety, belongingness, esteem, and self- actualization
accounting; financial management - CORRRECT ANSWER: The controller's _____
responsibilities are primarily in nature, while the treasurer's responsibilities are primarily related to _____ .
Accounts Payable Turnover - CORRRECT ANSWER: Represents the number of times
a company pays its accounts payable during a period. A low ratio is favored because it is better to delay payments as much as possible so that the money can be used for more productive purposes. (Operating/Efficiency Ratio)
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_____ = Net Credit Purchases / Ave. Accounts Payable
Accrual Basis Accounting - CORRRECT ANSWER: Revenue is recognized in the
accounting period in which the revenue is earned, regardless of when the associated revenue is received. (Recorded when the sale is made, not when it is paid for.)
Adam Smith - CORRRECT ANSWER: Father of Economics
Responsible for Division of Labor 1776:
Tasks are subdivided into individual jobs
Employees perform only the tasks relevant to their specialized function
Jobs tend to be small, but they can be performed efficiently
Proposes that production can be increased by dividing labor on to similar tasks
Administrative Law - CORRRECT ANSWER: Consists of the rules,orders, and
decisions of administrative agencies. These agencies are often given rule making, investigation, and enforcement powers.
Annuity - CORRRECT ANSWER: A series of equal dollar payments that continue for a specific number of years.
Annuity Due - CORRRECT ANSWER: A series of equal dollar payments that occur at
the beginning of each period.
Attribution Theory - CORRRECT ANSWER: Making inferences about the causes of an
individuals behavior. Examples:
Internal-failure due to self motivation
External- failure due mailly to factors beyond control: luck, resources
Authoritarianism - CORRRECT ANSWER: The belief that power and status differences should exist in an organization.
Authority (Management) - CORRRECT ANSWER: Managers must have the authority to
give orders, but they must also keep in mind that with authority comes responsibility.
Average Cost (Inventory) - CORRRECT ANSWER: Ending inventory units are costed
using an average cost of goods available divided by the units available for sale.
(Example: Rope)
Backward Integration - CORRRECT ANSWER: A vertical integration strategy that
involves entry into activities previously performed by suppliers or other enterprises 2 / 3
positioned along earlier stages of the industry value chain system (supply chain focused).
Balance Sheet - CORRRECT ANSWER: Attempts to describe the financial condition of the firm at a point in time.Includes: Assets, Liabilities, & Equity - "net assets" what remains after deducting liabilities from assets..
Bankruptcy - CORRRECT ANSWER: Legal procedure for liquidating a business which
cannot fully pay its debts out of its current assets.
Basic Inventory Equation for Cost of Goods Sold (COGS) - CORRRECT ANSWER:
Goods Available for Sale - Ending Inventory = Cost of Goods Sold (COGS)
Basic Inventory Equation for Ending Inventory - CORRRECT ANSWER: Beginning
Inventory + Purchases = Goods Available for Sale - Cost of Goods Sold (COGS) = ending inventory
Basic Inventory Equation for Goods - CORRRECT ANSWER: Beginning Inventory +
Purchases = Goods
board of directors - CORRRECT ANSWER: A company's _____ is (are) potentially the most effective instrument of good corporate governance.
Book Value per Share - CORRRECT ANSWER: Indicates the value of stock based on
historical cost. The value of common shareholders' equity in the books of the company is divided by the average common shares outstanding. (Valuation and Growth Ratio)
_____ = Common SHE / Average Common Shares
Branches of the Federal Government - CORRRECT ANSWER: Includes an Executive,
Legislative, and Judicial divisions.
Business Finance: The goal of the firm? - CORRRECT ANSWER: In finance, the commonly accepted goal of profit maximization is replaced with the more complete goal of the maximization of shareholder wealth.
Cash Basis Accounting - CORRRECT ANSWER: Revenue is recognized in the
accounting period in which the associated cash is received and Expenses are recognized in the accounting period that the cash is paid.
Cash Conversion Cycle - CORRRECT ANSWER: Measures how fast a company
converts cash into more cash. It represents the number of days a company pays for purchases, sells them, and collects the amount due. The SHORTER the number of cycle, the better. (Operating/Efficiency Ratio)
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