Q&A Hero

Q: Even small companies can possess great power in negotiations if they have A) little influence at headquarters. B) a larger negotiating team. C) more to lose and less to gain from a deal. D) more good alternatives than their large-company counterparts. E) the advantage of negotiating in a foreign land.

Q: The term __________________ refers to a liability that promises a future outflow of resources.

Q: If goods X and Y are complements, then the cross price elasticity of demand will beA) elastic. B) greater than zero but less than 1.C) negative. D) positive.

Q: In Getting to Yes, the notion of ________ relates to how power in negotiations is best measured. A) what you negotiate is what you get B) a face-to-face communication C) the best alternative to a negotiated agreement D) the failure to listen during negotiations E) a standard for business negotiations

Q: Every business transaction leaves the accounting equation in balance.

Q: The local baseball stadiumʹs concession stands previously sold hot dogs for 80 cents apiece. At that price, when a baseball fan went to watch a baseball game, he bought 2 hotdogs. But now that the stadium has a ʺdime-a-dog night,ʺ he has purchased 6 hot dogs. What is the approximate value of this individualʹs absolute price elasticity of demand for hot dogs?A) 0.64 B) 0.80 C) 1.00 D) 1.56

Q: What skills typically top the list of international negotiator traits? A) preparation and planning B) observational and oratory C) linguistic and social D) persuasion and intellectual E) informational and interpretation

Q: During the accounting period, the assets of a business increased $64,000 and liabilities decreased $17,000; consequently, equity in the business must have __________________ (increased, decreased) $__________________________.

Q: Technological change that makes it easier to produce in a ʺcleanerʺ fashion would cause A) the marginal cost curve of pollution abatement to shift left, increasing the degree of air quality. B) the marginal cost curve of pollution abatement to shift right, increasing the degree of air quality C) the marginal benefit curve of pollution abatement to shift right, increasing the degree of air quality D) the marginal benefit curve of pollution abatement to shift left, increasing the degree of air quality

Q: Mike had been negotiating with a Japanese company for distribution rights for five days. He was afraid he was going to lose the contract, so at the last minute he decided to lower the price. They accepted the next day. What mistake did Mike make? A) He should have come in with a low price at the outset. B) He should have had a written concession plan before he began the negotiation. C) He should have given the Japanese negotiators a menu of options including the lower price. D) He should have avoided all concessions. E) He should have deferred to his superiors.

Q: Net income is the excess of expenses over revenues, whereas net loss is the excess of revenues over expenses.

Q: What action must be taken by a negotiator before international negotiations begin? A) asking questions on specific areas of the deal B) planning concession strategies C) making concessions before reaching an agreement D) rushing the foreign negotiator to come to a decision E) relying only on information obtained from external sources

Q: The official poverty level is based on pretax income including cash. Which of the following statements is correct regarding this official specification of poverty?A) This is a good definition of poverty since it is made up of the income from productive resources.B) This is not a good definition of poverty because our tax structure consists of different tax brackets based on income.C) This is not a good definition of poverty because it does not include in -kind subsidies. D) This is a good definition of poverty because it is easy to measure.

Q: The accounting equation is ______________________________.

Q: Ford's program for managers working with Japanese, "Managing Negotiations: Japan," includes A) classes in the Japanese language. B) training in overcoming Japanese cultural traits. C) tapes of past negotiation mistakes. D) face-to-face practice with Japanese negotiators. E) rehearsals of upcoming negotiations.

Q: Paying a wage to an employee that is lower than the employeeʹs marginal revenue product is sometimes referred to asA) illegal in most states. B) monopolistic exploitation. C) monopsonistic exploitation. D) total exploitation.

Q: The legitimate claims of a business's creditors take precedence over the claims of the business owner.

Q: In the context of international negotiations, what is found to be lacking in the curricula of most schools of diplomacy? A) language skills B) diplomatic history and international relations C) foreign policies D) social and diplomatic skills E) cultural differences in communication styles

Q: A boycott of products sold by companies that are dealing with a company whose workers are on strike is aA) jurisdictional dispute. B) sympathy strike.C) right-to-boycott law. D) secondary boycott. Answer: D

Q: The owner's claim on assets is called __________________.

Q: With respect to the roles of men and women in international business negotiations, A) in general, women are more comfortable speaking up in a meeting than men to maintain intimacy with their foreign counterparts. B) men are more comfortable talking one-on-one than women, owing to the social stigma associated with such practices. C) the negotiation style of American women is a lot closer to that of the Japanese than that of American men. D) in countries where women do not participate in management, American female negotiators are first considered incompetent. E) it is not particularly important for female executives to establish personal rapport at restaurants and other informal settings.

Q: If labor productivity increases,A) labor costs rise by equal increments. B) the demand for labor increases.C) some workers will be laid off. D) jobs will relocate.

Q: In the context of international business negotiations, even in countries where women do not participate in management, American female negotiators are first treated as A) distractions. B) ignorant people. C) inappropriate. D) foreigners. E) inexperienced people.

Q: Owner's investments are gross increases in equity from a company's earnings activities.

Q: Acme Inc. found a tricky way to conform to the letter of the law with respect to new EPA regulations, even though they violated the spirit of the law. This is calledA) the capture theory.B) collusive response.C) share-the-gains, share-the-pains theory. D) creative response.

Q: Creditors claims on assets that reflect obligations to transfer assets are called _____________.

Q: ________ should not be used as a selection criterion for international negotiation teams. A) Stamina B) Maturity C) Ethnicity D) Breadth of knowledge E) Gender

Q: Refer to the above payoff matrix for the profits (in $ millions) of two firms (X and Y) and two product formats (A and B) in an industry. A possible outcome of the dominant strategy is:A) Both firm X and firm Y choose product format A. B) Both firm X and firm Y choose product format B.C) Firm X would be willing to choose product format A while firm Y simultaneously would wish o choose product format B.D) Firm X would be willing to choose product format B as long as firm Y wishes simultaneously also to choose product format B.

Q: Why is it important to bring along a senior executive to an international business negotiation? A) Influence at headquarters is crucial to success. B) The flexible position of the organization is indicated. C) The specific technical details of the deal can be discussed. D) Information can be collected through note taking with the goal of enhancing creativity. E) A larger number of nodding heads can reduce influence.

Q: A company might provide a service or product on credit. "On credit" implies that the cash payment will occur on a later date.

Q: The measurement of industry concentration which calculates the percentage of all sales contributed by a specific number of leading firms is called theA) Herfindahl-Hirschman Index. B) concentration ratio. C) producer price index. D) P/E ratio.

Q: An international business negotiator's primary job is collecting information with the goal of enhancing creativity. Which step may be taken during a meeting to ensure that the negotiator is able to do his job well? A) appointing different members of the team to provide self-disclosures and appropriate replies to queries B) bringing along junior executives for the purpose of training through observation and participation C) providing additional information to the other party when all the members fall silent during the meeting D) assigning one team member the sole responsibility of taking careful notes and not worrying about speaking E) including higher-rank executives and using informal channels of communication

Q: _____________ is increased by owner's investments and revenues. It is decreased by withdrawals and expenses.

Q: The greater the the number and closeness of substitutes available between monopolistically competitive firms,A) the greater the ability of a firm to raise its price above the price of close substitutes .B) the smaller the ability of a firm to raise its price above the price of close substitutes. C) the more inelastic the demand curve.D) the greater the positive economic profits for a single firm.

Q: The single most important activity of international business negotiations is A) organization. B) listening. C) presentation. D) etiquette. E) self-disclosure.

Q: Revenues occur when expenses exceed assets.

Q: In maximizing economic profit, the monopolist willA) choose the highest price that still permits some output sales.B) equate marginal cost to minimum average total cost. C) equate price to marginal cost.D) equate marginal revenue to marginal cost.

Q: In relationship-oriented cultures, ________ speaks quite loudly in both persuasion and the demonstration of interest in a business relationship. A) the bottom line B) profit C) team strength D) secrecy E) rank

Q: A common characteristic of __________ is their ability to provide expected future benefits to a business.

Q: Consider an industry that is in long -run equilibrium. An increase in demand leads to no change in the price of the good. We know that this isA) a decreasing cost industry. B) a constant cost industry.C) an increasing cost industry. D) not a competitive industry.

Q: What factor can get in the way of American team negotiations? A) cultural heritage of interdependence and collectivism B) emphasis on careful note taking and training via observation C) compensation schemes that overly emphasize individual performance D) preference for split commissions for negotiation teams E) hierarchical structures of American organizations

Q: The balance sheet is also called the statement of financial position because it describes the financial position of the business at a point in time.

Q: Which of the following equals the ratio of the change in total revenues over the change in output?A) Total cost B) Average revenueC) Demand D) Marginal revenue

Q: Americans often make the mistake of going it alone against a greater number of foreigners in business negotiations. This is likely related to what American trait? A) collectivism B) chivalry C) information-orientation D) pragmatism E) independence

Q: ____________ are the gross increases in equity from a company's earnings activities

Q: Total OutputTotal Costs0$101182213234245266297338389441051Using the above table, we see that when output is 4 units, average total cost equalsA) $24.00. B) $14.00. C) $3.50. D) $6.00.

Q: In studies conducted at Ford Motor Company and AT&T, three traits were found to be important predictors of negotiator success with international clients and partners, including A) ability to function without team assistance. B) influence at headquarters. C) appreciation of external factors in negotiations. D) ability to command attention from an audience. E) willingness to take on additional responsibilities.

Q: The accounting equation implies that: Assets + Liabilities = Equity.

Q: Stock markets for securities are important because A) they are where corporations raise financial capital. B) they are where proprietorships and partnerships raise financial capital. C) they permit individuals to transfer their savings directly into investment spending. D) they make the stocks and bonds more valuable.

Q: Which trait is important for marketing executives involved in international negotiations and technical experts who accompany them? A) optimism B) altruism C) resistance D) culturally apathy E) aggressiveness

Q: The ______________ reports revenues earned and expenses incurred by a business over a period of time.

Q: Global business success is the result of many factors, including A) standardization rather than customization of negotiation procedures across all cultures. B) the emergence of the English language as the chief medium of negotiations. C) increased homogenization of cultures across the world. D) the availability of large numbers of skillful international negotiators. E) avoidance of the use of technology in all areas related to business negotiations.

Q: Juanita has just started a business and is using her personal car to deliver goods. The use of her car is an example ofA) an explicit cost to the business. B) an implicit cost to the business. C) financial capital. D) interest.

Q: The accounting equation can be restated as: Assets - Equity = Liabilities.

Q: What is the first step toward initiating efficient and effective international business negotiations? A) managing preliminaries such as training and location of talks B) preparing and manipulating negotiation settings C) selecting an appropriate negotiation team D) managing the process of negotiations E) following up on procedures and practices

Q: The marginal rate of substitution is theA) rate at which the consumer will give up one good for an additional unit of the other good, such that total satisfaction is constant.B) rate at which the consumer can trade one good for the other in the marketplace.C) change in the quantity of one good that changes the utility received by one unit. D) same thing as the marginal utility of a good.

Q: Assets removed from the business by the business owner for personal use are called ____________.

Q: Fred, a purchasing manager at a department store in the United States, is engaged in negotiations with a Brazilian supplier. What behavior would indicate that Fred has been making progress in the negotiations with the Brazilians? A) decreased bargaining by the Brazilians B) the involvement of Brazilian executives of lower ranks to continue the discussions C) a noticeable decrease in instances of private conversations among the Brazilians D) questions by Brazilians that focus primarily on the more general areas of the deal E) a softening of attitudes and positions by the Brazilians on some of the issues

Q: ʺAs an individual consumes more units of a good, her total utility falls because of the law of diminishing marginal utility.ʺ Do you agree or disagree? Explain.

Q: What do Americans consider to be a signal of progress in a business negotiations with foreigners? A) absence of questions on specific areas of a deal B) a hardening of attitudes and positions on some issues C) a lesser frequency of talk among themselves in their own language D) higher-level foreigners being included in the discussions E) decreased bargaining and use of the higher-level and formal channels of communication

Q: Withdrawals are expenses.

Q: Suppose that the amount of computer printers demanded increases by 20 percent when the price of personal computers falls by 10 percent. The cross price elasticity of demand between computer printers and personal computers isA) 0.5. B) -2.0. C) -0.5. D) 2.0.

Q: Which statement reflects the decision-making style of the Americans in business negotiations? A) A business negotiation is an opportunity to develop a business relationship with the goal of long-term mutual benefit. B) The economic issues are the context, not the content, of the business negotiation talks. C) A business negotiation is a problem-solving activity, the best deal for both parties being the solution. D) Business issues are discussed at once, in no apparent order, and concessions are made on all issues at the end of the discussion. E) Interpersonal and interorganizational bonds take precedence over the bottom line in business negotiations.

Q: The accounting equation is: Assets = ___________ + Equity.

Q: Six months ago, the price of gasoline was $2.20 per gallon. Now, the price is $2.40 per gallon. In response to this price increase, the number of gallons of gasoline purchased has declined by 2 percent. Based on this information, what is the absolute price elasticity of demand for gasoline?A) 4.35 B) 1.20 C) 0.23 D) 0.10

Q: What is true of the decision-making process with respect to the American and Japanese negotiators? A) The Western sequential approach and the Eastern holistic approach are found to mix well. B) Americans often make unnecessary concessions right before agreements are announced by the Japanese. C) All issues are discussed at once by the Americans, in no apparent order, and concessions are made on all issues at the end of the discussion. D) American managers find it easy to measure the progress of negotiations with their Japanese counterparts. E) When negotiating with the Japanese, Americans find that the progress of negotiations is closely linked to the number of issues resolved.

Q: Assets are the resources owned or controlled by a business.

Q: The marginal cost curve of pollution abatement isA) downward sloping. B) upward sloping.C) horizontal. D) vertical.

Q: What is true regarding the decision-making processes in international business negotiations? A) Asian negotiators prefer to break up a complex, large task into a series of smaller tasks. B) The American approach to a complex negotiation task is to discuss all issues at once, in no apparent order. C) American negotiators tend to make larger concessions after agreements are announced. D) Americans tackle issues such as prices, delivery, and warranty one at a time, with the final agreement being the sum of smaller agreements. E) The Western sequential approach and the Eastern holistic approach to decision-making are found to complement each other.

Q: A ___________ occurs when expenses are greater than revenues.

Q: Many argue the poor are getting poorer, at least in a relative sense. Evidence that contradicts this is thatA) household income of the lowest twenty percent of households relative to the highest twenty percent of households has fallen over the last thirty years.B) the official poverty level of income has increased over the years.C) household spending of the lowest twenty percent of households relative to the highest twenty percent of households has held constant over the last thirty years.D) the pretax distribution of income is more equal than the after -tax distribution of income.

Q: Which approach is usually adopted by Westerners when faced with a complex negotiation task? A) dividing the large task into a series of smaller tasks B) analyzing the task in a holistic manner with foreign and domestic experts C) discussing all issues at once, in no apparent order D) making larger than normal concessions in a bid to push the deal through E) buying time by tackling peripheral issues first, and then tackling the main task

Q: Liabilities are the owner's claim on assets.

Q: A monopsonistic employer faces aA) perfectly elastic labor supply curve.B) perfectly inelastic labor supply curve.C) MFC curve that is greater than the wage rate at each quantity of labor.D) MFC curve that is less than the wage rate at each quantity of labor.

Q: According to foreign negotiators, which negotiation tactic is the most useful when dealing with Americans? A) offering cutbacks on deals B) including higher-level executives in talks C) providing lots of self-disclosures D) high first-offers, followed immediately with deeply discounted second-offers E) taking time with the negotiations

Q: ______________ activities involve using resources to research, develop, purchase, produce, distribute, and market products and services.

Q: The Taft-Hartley Act of 1947 outlawedA) strikes.B) make-work rules and forcing unwilling workers to join a union. C) right-to-work states.D) none of the above.

Q: In Japanese business organizations, subordinates do not share bad news with their superiors. This lack of internal communications can be attributed to A) the Japanese emphasis on individualism. B) the Japanese emphasis on hierarchical relationships. C) the Japanese emphasis on competition and individualism. D) the insistence on solving problems at the point of origin and not escalating them. E) Guanxi, the Japanese practice of personal connections.

Q: Expenses decrease equity and are the costs of assets or services used to earn revenues.

Q: Which statement reflects the American notion of the importance of objectivity? A) American business is the hotbed of nepotism. B) Americans place emphasis on economics and performance rather than people. C) In business, favoritism matters and it is key to a successful negotiation. D) Americans have little regard for decisions based upon the bottom line. E) American business is heavily skewed against meritocracy.