Business Degree Business Education Basic 5 — Questions and Answers
Question 1: What is 'corporate social responsibility' (CSR)?
- A legal obligation to report financial results publicly
- A business's commitment to ethical, social, and environmental practices beyond profit (Correct answer)
- A government program requiring community service hours
- An HR policy for employee volunteer programs only
Correct answer: A business's commitment to ethical, social, and environmental practices beyond profit
CSR refers to a company's voluntary commitment to operate ethically, contribute to economic development, and improve quality of life for employees, communities, and society.
Question 2: What is 'entrepreneurship'?
- Managing an existing large corporation
- The process of starting and running a new business while bearing its risks (Correct answer)
- A government-funded business development program
- Investing in publicly traded companies
Correct answer: The process of starting and running a new business while bearing its risks
Entrepreneurship involves identifying opportunities, organizing resources, and accepting the financial and personal risks of starting a new venture.
Question 3: In business communication, what is the purpose of an executive summary?
- To provide detailed technical specifications for engineers
- To give decision-makers a concise overview of a longer document (Correct answer)
- To list all employees with executive titles
- To summarize only the financial section of a report
Correct answer: To give decision-makers a concise overview of a longer document
An executive summary condenses the key points of a longer report so busy executives can quickly grasp the main findings, recommendations, and conclusions.
Question 4: What does 'diversification' mean as a business strategy?
- Focusing exclusively on one product line to maximize efficiency
- Expanding into new markets or products to spread risk (Correct answer)
- Reducing workforce size to cut costs
- Increasing advertising spend across multiple channels
Correct answer: Expanding into new markets or products to spread risk
Diversification involves entering new markets or developing new products to reduce dependency on a single revenue source and spread business risk.
Question 5: What is 'cash flow' in a business context?
- The total revenue a company earns in a year
- The net profit reported on the income statement
- The movement of money into and out of a business over time (Correct answer)
- The amount of cash held in savings accounts
Correct answer: The movement of money into and out of a business over time
Cash flow tracks all cash inflows (from operations, investing, financing) and outflows, showing whether a company generates enough cash to meet obligations.
Question 6: Which leadership style involves making decisions with significant employee input and collaboration?
- Autocratic leadership
- Laissez-faire leadership
- Democratic (participative) leadership (Correct answer)
- Transactional leadership
Correct answer: Democratic (participative) leadership
Democratic or participative leadership encourages team input in decision-making, which typically improves morale, buy-in, and creative problem-solving.
Question 7: What is 'economies of scale'?
- The cost of scaling up a business's technology infrastructure
- Cost advantages gained as production volume increases, lowering per-unit cost (Correct answer)
- A government subsidy for large manufacturers
- The price premium charged by industry leaders
Correct answer: Cost advantages gained as production volume increases, lowering per-unit cost
Economies of scale occur when increasing production leads to lower average costs per unit, because fixed costs are spread across more units.
Business Degree Business Education Basic 5
What is 'corporate social responsibility' (CSR)?