Test Prep BUSINESS-ENVIRONMENT-AND-CONCEPTS dumps - 100% Pass Guarantee!

Correct Answer: D

Choice "d" is correct. Cyclical Unemployment is caused by the business cycle. It tends to rise during a

recession and fall during an expansion.

Choice "a" is incorrect. This is an example of structural unemployment.

Choice "b" is incorrect. This is an example of frictional unemployment.

Choice "c" is incorrect. This is an example of seasonal unemployment.

Correct Answer: A

Choice "a" is correct. Expansionary monetary policy results when the Fed increases the money supply.

Expansionary monetary policy affects the economy through the following chain of events: (1) an increase

in the money supply causes interest rates to fall, (2) falling interest rates stimulate the desired levels of firm

investment and household consumption, (3) increases in desired investment and consumption cause an

increase in aggregate demand, and (4) aggregate demand shifts to the right causing real GDP and the

price level to rise.

Choice "b" is incorrect. An increase in the money supply causes investment to increase, not decrease.

Choice "c" is incorrect. An increase in the money supply causes interest rates to decrease, not increase,

investment to increase, not decrease and aggregate demand to increase, not decrease.

Choice "d" is incorrect per above Explanation.

Correct Answer: B

Choice "b" is correct. Establishing a strategic vision is not normally included as part of the logical steps to reach a decision. Although decision-making techniques are incorporated as part of establishing a strategic vision and consideration of strategic issues is important, the process of deriving the vision is not considered part of the decision-making process. Choice "a" is incorrect. Obtaining information as a basis for selecting between alternatives is generally viewed as a critical part of decision-making. Choice "c" is incorrect. Selecting alternatives is a specific decision-making action that is generally included as one of the steps identified in decision-making. Choice "d" is incorrect. Identifying alternative courses of action from which to choose is a decision-making process that is generally included as one of the steps identified in decision-making.

Correct Answer: C

Choice "c" is correct. The beta coefficient represents the measure of a particular stock's percentage

change compared to the percentage change in the market over the same period. The equation for the beta

coefficient is as follows:

% in Stock Price

% in Market price

Choice "a" is incorrect. The percentage change in earnings per share related to a percentage change in

sales represents the degree of combined leverage.

Choice "b" is incorrect. The ratio of stock price to earnings per share is the price earnings ratio.

Choice "d" is incorrect. Choice "d" represents a word salad distracter of nonsense terms.

Correct Answer: D

Choice "d" is correct. The cost of not taking a cash discount is generally higher than the cost of a bank

loan.

Choice "a" is incorrect. The cost of not taking a 2/10, net 30 cash discount is usually more than the prime

rate.

Choice "b" is incorrect. With trade terms of 2/15, net 60, if the discount is not taken, the buyer receives 60

(not 45) days of free credit. Choice "c" is incorrect. The cost of not taking the discount is lower (not higher)

for terms of 2/10, net 60 than for 2/10, net 30.