Test your basic knowledge |

DSST Introduction To Business

Subjects : dsst, business-skills, bvat

Instructions:

Answer 50 questions in 15 minutes.
If you are not ready to take this test, you can study here.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.

1. ____________ is a common payment approach that uses wide pay grades. It allows today's flatter companies to reward employees without having to move them up a hierarchy.
Small - The small business is a cornerstone of the U.S. economic system - particularly following the past decade - when a drastic increase in start-up companies made the U.S. economy a growth engine for the world.
Embargo- Although an embargo is usually established to protect a nation's industry from foreign competition - it can sometimes be done for other reasons. The U.S. - for example - bans the importation of toys with lead paint due to health reasons.
Customization - Systems of mass customization recognize that consumers have individual needs and are best served by products that can be easily customized for them.
Broadbanding - Because the company has fewer - broader pay grades - broadbanding allows companies to move employees to different positions without being restricted by the pay grades normally associated with specific jobs.

2. Most industrialized countries have regulations against ________ - the practice of selling large quantities of a product at a price lower than the cost of production or below what the company would charge in its own home market.
Dumping - Dumping is a tactic often used to win foreign customers or to reduce product surpluses. Countries such as the U.S. impose stiff antidumping penalties in order to protect domestic producers of similar products.
MNCs - Multinational Corporations (MNCs) will often earn more than half of their revenue from foreign sales.
Venture Capitalists - Small businesses that need large sums of investment (usually $10 million or more) and that have potential for rapid growth often turn to venture capitalists for financing.
Conversion - The conversion process can be either an analytic system - which breaks raw materials into one or most distinct products - or a synthetic system - which combines two or more materials to form a single product.

3. In the past few decades - some industries that were under strict government control have been opened up to competition through ___________ - or the abandonment or relaxation of existing regulations.
Deregulation - Until recent deregulation measures were taken - companies in the airline and banking industries were under such strict government control that they had little or no competition.
Trading - In 1994 - the United States - Canada - and Mexico formed the trading bloc known as NAFTA. Supporters of NAFTA say that jobs in the U.S. have multiplied due to increased exports. Opponents - on the other hand - contend that American jobs hav
Free Trade - The General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO) are both famous examples of organizations founded to support free trade. The WTO - in particular - has been a target for American protesters who fee
HR - The human resources (HR) department is generally in charge of hiring employees for a company - ensuring the quality of their job performance - and administering their compensation and benefits.

4. Specific items are subject to _____ taxes - regulatory taxes that are intended to help control potentially harmful practices or to help pay for public services used by taxpayers.
Excise - Gasoline - tobacco - and liquor are all subject to excise taxes. Federal excise taxes are also levied on certain services of a national scope - such as air travel and long-distance telephone calls.
Franchise - In exchange for an initial fee and possibly monthly royalties - a buyer can obtain a franchise of a larger company and have the right to sell its goods and services.
Balance - The balance of trade is not necessarily an accurate indicator of a nation's competitiveness in the world market. Fluctuations in currency - intrafirm trade - and several other factors can obscure the overall picture.
SBA - Among other services - the Small Business Administration (SBA) will back bank loans to qualified business owners - a guarantee that usually results in longer repayment terms.

5. Many recent international trade agreements and organizations have supported the basic principles of ______ _______ - a theory that each nation will ultimately benefit the most if they freely trade with each other without restrictive measures.
Just In Time - A just-in-time system minimizes waste and keeps costs down. However - it requires careful coordination between manufacturers and suppliers in order to work effectively.
Payments - In addition to business transactions - the balance of payments also measures money spent on foreign investment - military expenditures - tourism - and other international transactions. A country - obviously wants a favorable balance of pay
HR - The human resources (HR) department is generally in charge of hiring employees for a company - ensuring the quality of their job performance - and administering their compensation and benefits.
Free Trade - The General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO) are both famous examples of organizations founded to support free trade. The WTO - in particular - has been a target for American protesters who fee

6. Facilities specifically designed to house small businesses during their early growth phase are known as __________.
Incubators - Incubators are centers that provide small businesses with a professional setting and various resources - legal and accounting services - marketing support - etc. - they might need to get started.
Benefits - Some of the more common forms of employee benefits include medical and dental insurance; vacation - holiday - and sick pay; stock options; and retirement benefits.
Inventory - To minimize risk and cost - and also to increase manufacturing efficiency - most companies have established a system of inventory control.
Forecast - Although a production forecast cannot be predicted with certainty - it is an essential tool for use in the planning - budgeting - and scheduling of resources.

7. Usually - human resources will use the job description to develop a ____ __________ - describing the skills - education - and previous experience that the job requires.
Dumping - Dumping is a tactic often used to win foreign customers or to reduce product surpluses. Countries such as the U.S. impose stiff antidumping penalties in order to protect domestic producers of similar products.
Inventory - To minimize risk and cost - and also to increase manufacturing efficiency - most companies have established a system of inventory control.
MNCs - Multinational Corporations (MNCs) will often earn more than half of their revenue from foreign sales.
Job Specification. The last step in evaluating job requirements is the drafting of a job specification. This formal statement is a critical tool in determining whether or not an applicant is appropriate for the position.

8. One of the keys to an effective production process is to prepare an accurate production ________ that estimates how much of a company's goods and services must be produced in order to meet future demand.
Regulation - In most sectors of the economy - government regulation ensures that all competitors have an equal chance of producing a product - reaching the market - and making a profit.
Absolute Advantage - Whenever a nation can produce a particular item more efficiently than all other nations - it has an absolute advantage for that product. Since such advantages are usually based on the availability of natural resources - they rare
DPO - The growth of the Internet and its resources has made it easier for companies to sell stock through a direct public offering (DPO).
Forecast - Although a production forecast cannot be predicted with certainty - it is an essential tool for use in the planning - budgeting - and scheduling of resources.

9. The term _________ refers to the coordination of an organization's resources for the manufacture of goods or the delivery of services.

10. Once human resources has decided it needs to fill a particular position - it will then evaluate the requirements of the position through a formal - objective method called ___ _______.
Outsourcing - The increased practice of outsourcing specialized work has allowed many large firms to downsize and work with smaller staffs.
Job Analysis - Job analysis is the process by which jobs are studied to determine the exact tasks and dynamics needed to perform them.
DPO - The growth of the Internet and its resources has made it easier for companies to sell stock through a direct public offering (DPO).
Benefits - Some of the more common forms of employee benefits include medical and dental insurance; vacation - holiday - and sick pay; stock options; and retirement benefits.

11. Most companies use a system of _______ control to determine the right quantity of various items to have on hand and to keep track of their location - use - and condition.
Comparative Advantage - The comparative advantage theory is based upon the argument that specialization and exchange will increase a country's total output and allow both trading partners to enjoy a higher standard of living.
Inventory - To minimize risk and cost - and also to increase manufacturing efficiency - most companies have established a system of inventory control.
Profit Sharin - A company that participates in profit sharing usually distributes profits to employees on an quarterly - semi-annually - or annual basis.
MNCs - Multinational Corporations (MNCs) will often earn more than half of their revenue from foreign sales.

12. Similar to venture capitalists - ______ ________ tend to be wealthy individuals who are willing to loan smaller amounts of money and to stay involved with the company for a longer period of time.
Angel Investors - Risky start-ups that have trouble getting loans from a bank can sometimes find angel investors to finance their business.
Deregulation - Until recent deregulation measures were taken - companies in the airline and banking industries were under such strict government control that they had little or no competition.
Conversion - The conversion process can be either an analytic system - which breaks raw materials into one or most distinct products - or a synthetic system - which combines two or more materials to form a single product.
MNCs - Multinational Corporations (MNCs) will often earn more than half of their revenue from foreign sales.

13. When a country imports more than it exports - the resulting unfavorable trade balance is called a trade _______.
Deregulation - Until recent deregulation measures were taken - companies in the airline and banking industries were under such strict government control that they had little or no competition.
Balance - The balance of trade is not necessarily an accurate indicator of a nation's competitiveness in the world market. Fluctuations in currency - intrafirm trade - and several other factors can obscure the overall picture.
Protectionism - Emerging economies often practice protectionism in order to give new or weak industries an opportunity to grow and strengthen.
Deficit - In 1999 - the U.S. trade deficit soared to record heights - due to a falloff in U.S. exports rather than a surge in foreign imports.

14. In the United States - _______ have traditionally been used not only to raise revenue for government - but also to encourage or discourage certain types of behavior - including the restriction of certain business activities.
Customization - Systems of mass customization recognize that consumers have individual needs and are best served by products that can be easily customized for them.
Euro - These eleven countries account for nearly 20 percent of the world's gross domestic product - leading some to believe that the euro might one day rival the dollar or yen as the international currency of trade.
Job Specification. The last step in evaluating job requirements is the drafting of a job specification. This formal statement is a critical tool in determining whether or not an applicant is appropriate for the position.
Taxes - Laws surrounding the taxes of businesses have developed to such an extent that entire segments of accounting and legal professionals often help companies and individuals with their interpretation and compliance

15. One of the practices restricted by the landmark Clayton Antitrust Act was that of the _____ contract - which attempts to force buyers to purchase unwanted goods along with goods actually desired.
Job Analysis - Job analysis is the process by which jobs are studied to determine the exact tasks and dynamics needed to perform them.
Gain Sharing - Though similar to profit sharing - gain sharing differs in that it further encourages employees to think of innovative ways to save money for the company and improve its overall operation.
Tying - Microsoft was recently found guilty of violating antitrust laws - in large part because the court considered the bundling together of Web browsers and operating systems to be a tying contract.
Assurance - Broader than more basic quality control approaches - a quality assurance system ensures that every stage of production - from design to final product - meets or exceeds preset quality standards.

16. Defined contribution plans - defined benefits plans - and 401(k) plans are all examples of _______ plans - the most popular type of retirement coverage in companies today.
Pension - Pension plans are company-sponsored programs for providing employees with income when they retire.
Joint Venture - In countries where foreign companies are prohibited from owning facilities outright or from investing in a local business - a joint venture might be the only way to do business in that country.
Critical - The sequence of events that makes up the critical path requires the longest time to complete. If any step on this path falls behind schedule - then the entire operation will be delayed.
Orientation - Although orientation programs can vary from an hour-long information session to 'integration' curriculums that last several months - they all are created with the intention of helping new employees understand their role in the organizat

17. Since campaign laws limit the abilities of a business to donate money directly to a candidate - businesses will often instead funnel money through a _______.
PAC - Through a political action committee (PAC) - a business can solicit contributions from its employees and then allocate the money to various candidates. PACs are controversial and will likely be a target of campaign reform in the near future.
Franchise - In exchange for an initial fee and possibly monthly royalties - a buyer can obtain a franchise of a larger company and have the right to sell its goods and services.
DPO - The growth of the Internet and its resources has made it easier for companies to sell stock through a direct public offering (DPO).
Dumping - Dumping is a tactic often used to win foreign customers or to reduce product surpluses. Countries such as the U.S. impose stiff antidumping penalties in order to protect domestic producers of similar products.

18. NAFTA is a controversial example of a ________ bloc - an organization of nations that removes barriers to trade among their members and also establishes uniform barriers to trade with nonmember nations.
CAD - Computer-aided design (CAD) is just one of the major developments in manufacturing automation today. Others include computer-aided engineering (CAE) - computer-aided manufacturing (CAM) - and flexible manufacturing system (FMS).
Trading - In 1994 - the United States - Canada - and Mexico formed the trading bloc known as NAFTA. Supporters of NAFTA say that jobs in the U.S. have multiplied due to increased exports. Opponents - on the other hand - contend that American jobs hav
Absolute Advantage - Whenever a nation can produce a particular item more efficiently than all other nations - it has an absolute advantage for that product. Since such advantages are usually based on the availability of natural resources - they rare
Dumping - Dumping is a tactic often used to win foreign customers or to reduce product surpluses. Countries such as the U.S. impose stiff antidumping penalties in order to protect domestic producers of similar products.

19. A ________ is a type of embargo that is politically motivated - banning trade with a particular nation.
Sanction - Traditionally - a sanction has been used by the government as a forceful attempt to make a country change its behavior. However - sanctions are being used more sparingly today - as studies have shown them to be generally ineffective.
Job Description. The job description helps HR determine the qualifications needed by potential applicants to be considered for the job.
Compensation. Compensation is the umbrella term covering all the various money - benefits - and services paid to employees for their work.
DPO - The growth of the Internet and its resources has made it easier for companies to sell stock through a direct public offering (DPO).

20. Following job analysis - the human resources staff will use their findings to complete a ____ ___________ - a formal statement summarizing the tasks involved in the job and the conditions under which the employee will work.
Job Description. The job description helps HR determine the qualifications needed by potential applicants to be considered for the job.
MNCs - Multinational Corporations (MNCs) will often earn more than half of their revenue from foreign sales.
Franchise - In exchange for an initial fee and possibly monthly royalties - a buyer can obtain a franchise of a larger company and have the right to sell its goods and services.
PAC - Through a political action committee (PAC) - a business can solicit contributions from its employees and then allocate the money to various candidates. PACs are controversial and will likely be a target of campaign reform in the near future.

21. Quality __________ is a comprehensive system of policies - practices - and procedures implemented throughout a company to create and produce quality goods and services.
Inventory - To minimize risk and cost - and also to increase manufacturing efficiency - most companies have established a system of inventory control.
Gain Sharing - Though similar to profit sharing - gain sharing differs in that it further encourages employees to think of innovative ways to save money for the company and improve its overall operation.
Assurance - Broader than more basic quality control approaches - a quality assurance system ensures that every stage of production - from design to final product - meets or exceeds preset quality standards.
Absolute Advantage - Whenever a nation can produce a particular item more efficiently than all other nations - it has an absolute advantage for that product. Since such advantages are usually based on the availability of natural resources - they rare

22. Business owners pay as much as $150 billion every year due to product ________ lawsuits - which hold the producer or seller responsible for damages or injuries to the consumer.
Liability - Because many of these product liability lawsuits seem frivolous and excessive - many lawmakers are beginning to question the strictness with which the laws are interpreted.
Incentives. Incentives are often effective because they make achievements - not merely activities - the basis for an employee's payment.
Balance - The balance of trade is not necessarily an accurate indicator of a nation's competitiveness in the world market. Fluctuations in currency - intrafirm trade - and several other factors can obscure the overall picture.
Angel Investors - Risky start-ups that have trouble getting loans from a bank can sometimes find angel investors to finance their business.

23. In 1999 - eleven European countries turned over control of their individual monetary policies to the newly created European Central Bank. One of the major reasons for joining forces was the anticipated advantages that would come from creating a unifi

24. ______ is widely used today to apply computer graphics and mathematical modeling in the design of products.
CAD - Computer-aided design (CAD) is just one of the major developments in manufacturing automation today. Others include computer-aided engineering (CAE) - computer-aided manufacturing (CAM) - and flexible manufacturing system (FMS).
Pension - Pension plans are company-sponsored programs for providing employees with income when they retire.
Temporary - It is estimated that over a quarter of all temporary employees hired remain on the job assignment for one year or more. Businesses often try to save money and increase their flexibility by building their workforce around part-time and tem
Angel Investors - Risky start-ups that have trouble getting loans from a bank can sometimes find angel investors to finance their business.

25. The _____ is a government agency that serves as an invaluable resource and advocate for small businesses - often providing them with financial assistance - training - and a variety of helpful programs.
SBA - Among other services - the Small Business Administration (SBA) will back bank loans to qualified business owners - a guarantee that usually results in longer repayment terms.
Broadbanding - Because the company has fewer - broader pay grades - broadbanding allows companies to move employees to different positions without being restricted by the pay grades normally associated with specific jobs.
Inventory - To minimize risk and cost - and also to increase manufacturing efficiency - most companies have established a system of inventory control.
Performance Appraisal. Most human resources managers develop performance appraisal systems to objectively evaluate employees according to set - job-related criteria.

26. Because of the high costs and regulatory complexities of selling stock through an initial public offering (IPO) - many companies are instead choosing to sell shares of stock directly to investors through a _______.
Agency - Some better known examples of a regulatory agency include the Occupational Safety and Health Administration (OSHA) - the Equal Employment Opportunity Commission (EEOC) - and the Environmental Protection Agency (EPA).
DPO - The growth of the Internet and its resources has made it easier for companies to sell stock through a direct public offering (DPO).
Floating - Neither Thailand or Indonesia were ready when their currency devalued rapidly after switching to a floating exchange rate system. In such a system - the value of a currency is not determined in relation to more stable currencies - but in r
Balance - The balance of trade is not necessarily an accurate indicator of a nation's competitiveness in the world market. Fluctuations in currency - intrafirm trade - and several other factors can obscure the overall picture.

27. Many companies now integrate all of the facilities - functions - and activities involved in the production of goods and services - from suppliers to customers - through a process called Supply ___________ Management
Assurance - Broader than more basic quality control approaches - a quality assurance system ensures that every stage of production - from design to final product - meets or exceeds preset quality standards.
Chain - The supply-chain begins with the provider of raw materials and ends with the company that produces the finished product. Supply-chain management is based upon the belief that all companies involved will benefit from working more closely toget
Orientation - Although orientation programs can vary from an hour-long information session to 'integration' curriculums that last several months - they all are created with the intention of helping new employees understand their role in the organizat
Business Plan - Not only does a business plan help sway potential investors - it also provides the company with an overall strategy and guides its operations

28. Customs _______ - or import taxes - vary with the product and its country of origin. They are designed to protect American businesses against foreign competition.
Duties - Customs duties typically have the effect of raising the prices of imports to a level comparable to the price of similar American-made merchandise
Forecasting - After analyzing the company's future goals - the HR department begins planning the company's staffing needs by forecasting the supply and demand for employees.
Temporary - It is estimated that over a quarter of all temporary employees hired remain on the job assignment for one year or more. Businesses often try to save money and increase their flexibility by building their workforce around part-time and tem
Commission - Depending on the company and position - a commission can be either the sole compensation or else an incentive payment made in addition to salary or wages.

29. One way to measure a nation's level of international trade is to determine its _________ of trade - The total value of the productions a nation exports minus the total value of the products it imports - over some period of time.

30. Particularly with the recent increase in workplace violence - human resource departments are more carefully conducting ____________ ________ to verify all educational credentials and previous jobs - to account for any large time gaps between jobs - a
Forecast - Although a production forecast cannot be predicted with certainty - it is an essential tool for use in the planning - budgeting - and scheduling of resources.
Wages. Unlike salaried workers - workers earning wages receive cash payment directly related to the number of hours worked or pieces produced. Wages provide an incentive to an employee to produce more in order to receive a higher paycheck.
Deregulation - Until recent deregulation measures were taken - companies in the airline and banking industries were under such strict government control that they had little or no competition.
Background Checks - Failure to conduct thorough background checks can lead to expensive lawsuits and higher health care costs - decreased productivity - and harm to employees and customers. Inadequate verification of credentials can potentially make

31. More and more companies are using __________ agreements as a source of international revenue - allowing foreign companies to use their intellectual property in exchange for a royalty or fee.
Conversion - The conversion process can be either an analytic system - which breaks raw materials into one or most distinct products - or a synthetic system - which combines two or more materials to form a single product.
Duties - Customs duties typically have the effect of raising the prices of imports to a level comparable to the price of similar American-made merchandise
Job Specification. The last step in evaluating job requirements is the drafting of a job specification. This formal statement is a critical tool in determining whether or not an applicant is appropriate for the position.
Licensing - Since a company has already incurred the costs of developing the intellectual property - a licensing agreement involves little out-of-pocket costs.

32. The ultimate goal of a _________ ___________ is not to judge the individual employee but rather to improve their on-the-job performance. It lets employees understand how they are presently doing - instructs them on how they can improve performance -
Commission - Depending on the company and position - a commission can be either the sole compensation or else an incentive payment made in addition to salary or wages.
Pension - Pension plans are company-sponsored programs for providing employees with income when they retire.
Performance Appraisal. Most human resources managers develop performance appraisal systems to objectively evaluate employees according to set - job-related criteria.
Conversion - The conversion process can be either an analytic system - which breaks raw materials into one or most distinct products - or a synthetic system - which combines two or more materials to form a single product.

33. Usually used for sales staff - a ____________ is a form of payment that pays employees a percentage of sales made.
Critical - The sequence of events that makes up the critical path requires the longest time to complete. If any step on this path falls behind schedule - then the entire operation will be delayed.
Embargo- Although an embargo is usually established to protect a nation's industry from foreign competition - it can sometimes be done for other reasons. The U.S. - for example - bans the importation of toys with lead paint due to health reasons.
Commission - Depending on the company and position - a commission can be either the sole compensation or else an incentive payment made in addition to salary or wages.
Pension - Pension plans are company-sponsored programs for providing employees with income when they retire.

34. A _____ ________ incentive plan rewards employees not solely on the basis of overall profits but in relation to achievement of goals such as cost savings or quality improvement.
Background Checks - Failure to conduct thorough background checks can lead to expensive lawsuits and higher health care costs - decreased productivity - and harm to employees and customers. Inadequate verification of credentials can potentially make
POM - Production and operations management (POM) - sometimes just shortened to operations management - oversees all the activities involved in producing a firm's goods or services.
Gain Sharing - Though similar to profit sharing - gain sharing differs in that it further encourages employees to think of innovative ways to save money for the company and improve its overall operation.
Job Analysis - Job analysis is the process by which jobs are studied to determine the exact tasks and dynamics needed to perform them.

35. __________ is the process by which the government sets the ground rules and basic standards of proper business behavior - in order to prevent conflicts and facilitate the workings of the economic system.
Pension - Pension plans are company-sponsored programs for providing employees with income when they retire.
Regulation - In most sectors of the economy - government regulation ensures that all competitors have an equal chance of producing a product - reaching the market - and making a profit.
Assurance - Broader than more basic quality control approaches - a quality assurance system ensures that every stage of production - from design to final product - meets or exceeds preset quality standards.
Recruiting - Recruiting usually begins by looking for a suitable candidate from within an organization or from an employee's recommendation. Posting a position to the public is often used as a last resort.

36. ___________ - or selling and shipping goods and services to another country - is one of the least risky forms of international business activity.
HR - The human resources (HR) department is generally in charge of hiring employees for a company - ensuring the quality of their job performance - and administering their compensation and benefits.
Exporting - Exporting permits a company to enter a foreign market gradually - with only limited marketing - research - and distribution costs.
Embargo- Although an embargo is usually established to protect a nation's industry from foreign competition - it can sometimes be done for other reasons. The U.S. - for example - bans the importation of toys with lead paint due to health reasons.
Liability - Because many of these product liability lawsuits seem frivolous and excessive - many lawmakers are beginning to question the strictness with which the laws are interpreted.

37. A type of trade restriction - _________ limit the amount of a particular good that a nation will allow to be imported during a year.
Exporting - Exporting permits a company to enter a foreign market gradually - with only limited marketing - research - and distribution costs.
Licensing - Since a company has already incurred the costs of developing the intellectual property - a licensing agreement involves little out-of-pocket costs.
Profit Sharin - A company that participates in profit sharing usually distributes profits to employees on an quarterly - semi-annually - or annual basis.
Quotas - Quotas may be set either in quantity or in value. Once a foreign product hits its quota - additional shipments typically will face stiff tariffs.

38. _______ _________ are investment specialists who raise pools of capital from large private and institutional sources in exchange for a portion of the ownership - with the objective of making a considerable profit on the investment within a relatively
Intrapreneurs - Work units led by intrapreneurs are formed to provide the parent company with creative ideas usually hindered by the red tape and procedures of a large-scale corporate environment.
Critical - The sequence of events that makes up the critical path requires the longest time to complete. If any step on this path falls behind schedule - then the entire operation will be delayed.
Quotas - Quotas may be set either in quantity or in value. Once a foreign product hits its quota - additional shipments typically will face stiff tariffs.
Venture Capitalists - Small businesses that need large sums of investment (usually $10 million or more) and that have potential for rapid growth often turn to venture capitalists for financing.

39. _____________ - or subcontracting work to outside companies - is a common staffing strategy by companies that lack specialized resources internally.
Comparative Advantage - The comparative advantage theory is based upon the argument that specialization and exchange will increase a country's total output and allow both trading partners to enjoy a higher standard of living.
Temporary - It is estimated that over a quarter of all temporary employees hired remain on the job assignment for one year or more. Businesses often try to save money and increase their flexibility by building their workforce around part-time and tem
Angel Investors - Risky start-ups that have trouble getting loans from a bank can sometimes find angel investors to finance their business.
Outsourcing - Although outsourcing might give a company increased flexibility and additional expertise - it can also result in a loss of control over the work and a greater dependence on suppliers.

40. The Federal Trade Commission Act (1914) is a famous example of _______ legislation - intended to prevent individual companies or groups of companies from gaining control of markets in ways that restrain competition or harm consumers.
Antitrust - Other famous examples of antitrust legislation include the Sherman Antitrust Act (1890) and the Clayton Antitrust Act (1914). Such regulations sought to break up the power of huge companies such as Standard Oil.
Comparative Advantage - The comparative advantage theory is based upon the argument that specialization and exchange will increase a country's total output and allow both trading partners to enjoy a higher standard of living.
Internet - The Internet has made accessible to small businesses the types of resources and information that were previously available only to larger firms.
Customization - Systems of mass customization recognize that consumers have individual needs and are best served by products that can be easily customized for them.

41. Employees who receive _______ earn cash payment based on the number of hours the employee has worked or the number of units the employee has produced.
Wages. Unlike salaried workers - workers earning wages receive cash payment directly related to the number of hours worked or pieces produced. Wages provide an incentive to an employee to produce more in order to receive a higher paycheck.
Performance Appraisal. Most human resources managers develop performance appraisal systems to objectively evaluate employees according to set - job-related criteria.
Trading - In 1994 - the United States - Canada - and Mexico formed the trading bloc known as NAFTA. Supporters of NAFTA say that jobs in the U.S. have multiplied due to increased exports. Opponents - on the other hand - contend that American jobs hav
Profit Sharin - A company that participates in profit sharing usually distributes profits to employees on an quarterly - semi-annually - or annual basis.

42. More extreme than a quota - an ________ completely bans the import or export of certain products.

43. The majority of small businesses are what are known as ________ businesses. They are built around the personal and financial needs of an individual or family - and are not typically designed to grow into large enterprises.
Inventory - To minimize risk and cost - and also to increase manufacturing efficiency - most companies have established a system of inventory control.
Background Checks - Failure to conduct thorough background checks can lead to expensive lawsuits and higher health care costs - decreased productivity - and harm to employees and customers. Inadequate verification of credentials can potentially make
Commission - Depending on the company and position - a commission can be either the sole compensation or else an incentive payment made in addition to salary or wages.
Lifestyle - Roughly 80 to 90% of small businesses are lifestyle businesses. The remainder are called high-growth ventures and are started with the intent of rapid expansion.

44. In planning tools such as PERT diagrams - the longest path through the network is known as the ________ path because it represents the minimum amount of time needed to complete the project.
Critical - The sequence of events that makes up the critical path requires the longest time to complete. If any step on this path falls behind schedule - then the entire operation will be delayed.
Incubators - Incubators are centers that provide small businesses with a professional setting and various resources - legal and accounting services - marketing support - etc. - they might need to get started.
Free Trade - The General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO) are both famous examples of organizations founded to support free trade. The WTO - in particular - has been a target for American protesters who fee
Recruiting - Recruiting usually begins by looking for a suitable candidate from within an organization or from an employee's recommendation. Posting a position to the public is often used as a last resort.

45. __________ occurs when a multinational corporation establishes facilities in a foreign country or in some other way invests money directly into foreign business enterprises.
Customization - Systems of mass customization recognize that consumers have individual needs and are best served by products that can be easily customized for them.
Job Description. The job description helps HR determine the qualifications needed by potential applicants to be considered for the job.
FDI - A company that increases its involvement in foreign countries through establishing Foreign Direct Investment (FDI) might build marketing or production facilities - or even purchase existing firms.
Taxes - Laws surrounding the taxes of businesses have developed to such an extent that entire segments of accounting and legal professionals often help companies and individuals with their interpretation and compliance

46. The ____________ ____________ theory states that a country should produce and sell to other countries those items it can produce economically - and trade for those it cannot produce efficiently or at a lower cost.

47. Some countries practice an economic policy of ___________ - where they restrict international trade in order to shield a country's industries from foreign competition and the possible loss of jobs in those industries.
Compensation. Compensation is the umbrella term covering all the various money - benefits - and services paid to employees for their work.
Strategic Alliance - To increase their competitive advantage in foreign markets - many companies will form a strategic alliance with a foreign company. Companies in such a relationship will typically share ideas - risks - and profits in an attempt to
Pension - Pension plans are company-sponsored programs for providing employees with income when they retire.
Protectionism - Emerging economies often practice protectionism in order to give new or weak industries an opportunity to grow and strengthen.

48. A _______ ________is a special type of strategic alliance in which two or more organizations join together to create a new business entity that is legally separate and distinct from its parents.
Intrapreneurs - Work units led by intrapreneurs are formed to provide the parent company with creative ideas usually hindered by the red tape and procedures of a large-scale corporate environment.
Joint Venture - In countries where foreign companies are prohibited from owning facilities outright or from investing in a local business - a joint venture might be the only way to do business in that country.
Incentives. Incentives are often effective because they make achievements - not merely activities - the basis for an employee's payment.
Incubators - Incubators are centers that provide small businesses with a professional setting and various resources - legal and accounting services - marketing support - etc. - they might need to get started.

49. Financial compensation other than wages - salaries - and incentives is called employee ______________.
Embargo- Although an embargo is usually established to protect a nation's industry from foreign competition - it can sometimes be done for other reasons. The U.S. - for example - bans the importation of toys with lead paint due to health reasons.
HR - The human resources (HR) department is generally in charge of hiring employees for a company - ensuring the quality of their job performance - and administering their compensation and benefits.
Absolute Advantage - Whenever a nation can produce a particular item more efficiently than all other nations - it has an absolute advantage for that product. Since such advantages are usually based on the availability of natural resources - they rare
Benefits - Some of the more common forms of employee benefits include medical and dental insurance; vacation - holiday - and sick pay; stock options; and retirement benefits.

50. As foreign markets continue to grow in importance - the number of ____________ - or companies with operations in more than one country - is likewise increasing.
MNCs - Multinational Corporations (MNCs) will often earn more than half of their revenue from foreign sales.
Gain Sharing - Though similar to profit sharing - gain sharing differs in that it further encourages employees to think of innovative ways to save money for the company and improve its overall operation.
FDI - A company that increases its involvement in foreign countries through establishing Foreign Direct Investment (FDI) might build marketing or production facilities - or even purchase existing firms.
Job Specification. The last step in evaluating job requirements is the drafting of a job specification. This formal statement is a critical tool in determining whether or not an applicant is appropriate for the position.