Introduction to Business

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This is a sample practice test created by Maryland FBLA to help you study for your competitive event! It is merely to help you study, so take your time and feel free to take the test as many times as you want. Answers will be shown after you submit.

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Maryland FBLA

Information liability is the responsibility for physical or economic injury arising from incorrect data or wrongful use of data.

1 point

True

False

Clear selection

The Consumer Product Safety Act of 1972 set safety standards on many consumer products.

1 point

True

False

Clear selection

A sole proprietor

1 point

assumes all losses of the business.

assumes no profits.

receives tax-free fringe benefits.

assumes no losses.

Clear selection

An independent, non-profit, publication that reports on a wide range of consumer products tested is

1 point

Consumer Digest.

Consumer Reports.

Good Housekeeping.

Parents.

Clear selection

The person named in an insurance policy to receive the insurance benefits is

1 point

the insured.

the benefactor.

the beneficiary.

the premium.

Clear selection

Property that is permanently attached to land is known as

1 point

real property.

personal property.

equipment.

capital property.

Clear selection

To improve control of operations, the owner of a flower shop wishes to measure performance at the process stage. The owner might

1 point

inspect raw materials.

use quality control.

set sales quotas.

improve personnel-selection methods.

Clear selection

Ellen Maslow owns a home worth $90,000 and wanted to be sure it was insured for at least 80 percent of its value. For how much should it be insured?

1 point

$17,000

$72,000

$81,000

$88,000

Clear selection

The only direct channel of distribution is

1 point

producer to consumer.

producer to retailer to consumer.

retailer to consumer.

producer to wholesaler to retailer to consumer.

Clear selection

Which of the following is an economic system in which the method for determining what, how, and for whom goods and services are produced is decided by a central authority?

1 point

Market economy

Command economy

Mixed economy

Privatized economy

Clear selection

A tension that occurs immediately following a purchase decision when consumers have second thoughts as to the wisdom of their purchase is

1 point

post-purchase confusion.

self-actualization.

problem recognition

cognitive dissonance

Clear selection

Stockholders have limited liability unless they

1 point

are active in the management of the corporation.

personally endorse company notes.

own preferred stock.

convert their shares to partnership status.

Clear selection

Which of the following governmental agencies is responsible for monitoring infomercials to ensure that both the format and the content of the programs are non-deceptive?

1 point

The Division of Marketing Practices

The Division of Financial Practice

The Internal Revenue Service

The Division of Advertising Practices

Clear selection

In a partnership, each partner has agency power, which means that

1 point

upon death of one partner, the remaining partners can operate the business.

a partner can legally bind all members to the firm.

an executor can act as a partner.

a partner can compete in business and remain a partner.

Clear selection

Which one of the following is the correct order of the consumer decision making process?

1 point

Purchase decision; Information search and evaluation; Problem recognition; Post-purchase evaluation

Purchase decision; Problem recognition; Information search and evaluation; Post-purchase evaluation

Information search and evaluation; Purchase decision; Problem recognition; Post-purchase evaluation

Problem recognition; Information search and evaluation; Purchase decision; Post-purchase evaluation

Clear selection

S corporations are taxed as

1 point

proprietorships.

partnerships.

C corporations.

domestic corporations.

Clear selection

Which of the following legal forms of organizing a business is most difficult to establish?

1 point

Proprietorship

Partnership

Limited partnership

Corporation

Clear selection

In a limited partnership, which of the following remains bound by all debts of the business?

1 point

Limited partner

Special partner

Stockholders

General partner

Clear selection

Limited liability for business debts is granted to

1 point

sole proprietors.

general partners.

shareholders in S corporations.

strategic alliances.

Clear selection

A common stockholder

1 point

casts one vote per share at stockholders’ meetings.

can not vote at stockholders’ meetings.

is a member of the board of directors.

declares dividends at stockholders’ meetings.

Clear selection

Scarcity is a problem that is faced by individuals and businesses but not by governments.

1 point

True

False

Clear selection

In the private enterprise system, you may start or invest in any business as long it is not illegal to do so.

1 point

True

False

Clear selection

Economic growth refers to a steady increase in the production of goods and services in an economic system.

1 point

True

False

Clear selection

The base year used in comparing GDPs adds confusion to the comparison.

1 point

True

False

Clear selection

Consumers often have a negative or narrow view of marketing.

1 point

True

False

Clear selection

One of the ways in which governments borrow money is through the selling of bonds.

1 point

True

False

Clear selection

Human resources, the people who work for the business, are important to every business.

1 point

True

False

Clear selection

Profit sharing means that employees receive their regular compensation plus a share of the profits earned by the company.

1 point

True

False

Clear selection

It is not necessary to include a personal data sheet if you have a well-written and complete letter of application.

1 point

True

False

Clear selection

Retired business people can belong to an organization that provides specialized assistance to small-business owners.

1 point

True

False

Clear selection

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