“Unit 4 Examination
175
BAM 105 Introduction to Business
Multiple Choice Questions
(Enter your answers on the enclosed answer sheet)
1. _____________ is a basic communications protocol used to
send e-mail.
a. Internet Service Network
b. Simple message transfer protocol
c. Arpanet
d. Federal Information Exchange
2. _____________ allow outsiders limited access to a firms
internal information systems.
a. Intranets
b. Extranets
c. Directories
d. Firewalls
3. In client-server networks, the client is usually the
_____________.
a. computer through which users make requests for
information
b. customer
c. supplier
d. computer through which users supply answers for requests
for information
4. A firewall provides _____________.
a. privacy protection
b. the connection of stations in a LAN
c. protection from electrical surges
d. Internet access
5. _____________ is software that connects members of a
group for shared e-mail distribution,
electronic meetings, appointments and group writing.
a. Electronic conferencing
b. The Internet
c. A data network
d. Groupware
6. The term
data
refers to _____________.
a. names and numbers from a large phonebook
b. raw facts and figures
c. conclusions made from information
d. the useful interpretation of facts and figures

Unit 4 Examination
176
BAM 105 Introduction to Business
7. _____________ is the meaningful, useful interpretation of
data.
a. Datamation
b. Megadata
c. Information
d. Accounting
8. A(n) _____________manager is in charge of operating
systems for gathering, organizing and
distributing information.
a. production
b. HR
c. operations
d. information systems
9. Once inside a computer network, hackers are able to
commit _____________, the unauthorized
stealing of personal information.
a. identity theft
b. leverage
c. espionage
d. denial of service
10. Customers can order a personal computer from the Dell
site with exactly the features they
desire through _____________.
a. mass-customization
b. process management
c. mass production
d. unit production
11. What is the major limitation of Wi-Fi?
a. high cost
b. productivity
c. short range of distance
d. privacy concerns
12. Land, building and equipment are _____________.
a. depleted assets
b. assets
c. liquid assets
d. current assets

Unit 4 Examination
177
BAM 105 Introduction to Business
13. _____________ represent the total cost of obtaining
materials for making the products sold by
a firm during the year.
a. Net profits
b. Revenues
c. Cost of goods sold
d. Operating expenses
14. _____________ expenses result from activities related to
selling goods or services.
a. Gross
b. Sales and marketing
c. Income
d. Revenue
15. The _____________ is the financial statement describing
a firms yearly cash receipts and cash
payments.
a. statement of retained earnings
b. cash flow statement
c. balance sheet
d. income statement
16. Howard Industries is having a CPA firm review its
financial records to confirm their
conformance with generally accepted accounting principles.
Howard Industries is in the
process of a(n) _____________.
a. company-wide analysis
b. portfolio analysis
c. audit
d. preliminary examination
17. A _____________ is a promise by a bank to pay a foreign
firm a certain amount of money if
specific conditions are met.
a. letter of credit
b. bankers acceptance
c. currency exchange
d. financial advisement
18. About how many ATMs are located in U.S. bank buildings
and other locations?
a. 20,000
b. 360,000
c. 120,000
d. 550,000

Unit 4 Examination
178
BAM 105 Introduction to Business
19. Because the U.S. dollar varies only slightly in its
ability to purchase goods, it is considered
_____________.
a. divisible
b. stable
c. portable
d. durable
20. Money lets you measure the relative values of goods and
services. In so doing, money is
performing which of the following functions?
a. determination factor
b. store of value
c. measure of worth
d. monetary flagging
21. Which of the following statements is NOT true about
dividend payments?
a. During bad years, companies are still required to pay
dividends.
b. Many fast-growing companies use cash earnings for
expanding the company so that
future earnings can grow even faster.
c. Many companies distribute between 30 and 70 percent of
their profits to shareholders.
d. Some firms, especially fast-growing companies, do not pay
dividends.
22. A(n) _____________ fund nearly matches the performance
of a particular market.
a. index
b. balanced
c. aggressive
d. market
23. A(n) _____________ is a summary of price trends in a
specific industry and/or the stock market
as a whole.
a. average index
b. market index
c. investment index
d. market indicator
24. What is the formula for measuring a firms working
capital?
a. current assets = working capital – current liabilities
b. current liabilities = current assets – working capital
c. working capital = current assets – current liabilities
d. None of the above.

Unit 4 Examination
179
BAM 105 Introduction to Business
25. A _____________ is a formal pledge (an IOU) obligating
the issuer to pay interest periodically
and repay the principal at maturity (a preset future date)
to the lender.
a. bond indenture
b. commercial bank loan
c. mutual fund
d. corporate bond

Unit 4 Examination175BAM 105 Introduction to BusinessMultiple Choice Questions(Enter your answers on the enclosed answer sheet)1. _____________ is a basic communications protocol used to
send e-mail.a. Internet Service Networkb. Simple message transfer protocolc. Arpanetd. Federal Information Exchange2. _____________ allow outsiders limited access to a firms
internal information systems.a. Intranetsb. Extranetsc. Directoriesd. Firewalls3. In client-server networks, the client is usually the
_____________.a. computer through which users make requests for
informationb. customerc. supplierd. computer through which users supply answers for requests
for information4. A firewall provides _____________.a. privacy protectionb. the connection of stations in a LANc. protection from electrical surgesd. Internet access5. _____________ is software that connects members of a
group for shared e-mail distribution,electronic meetings, appointments and group writing.a. Electronic conferencingb. The Internetc. A data networkd. Groupware6. The termdatarefers to _____________.a. names and numbers from a large phonebookb. raw facts and figuresc. conclusions made from informationd. the useful interpretation of facts and figuresUnit 4 Examination176BAM 105 Introduction to Business7. _____________ is the meaningful, useful interpretation of
data.a. Datamationb. Megadatac. Informationd. Accounting8. A(n) _____________manager is in charge of operating
systems for gathering, organizing anddistributing information.a. productionb. HRc. operationsd. information systems9. Once inside a computer network, hackers are able to
commit _____________, the unauthorizedstealing of personal information.a. identity theftb. leveragec. espionaged. denial of service10. Customers can order a personal computer from the Dell
site with exactly the features theydesire through _____________.a. mass-customizationb. process managementc. mass productiond. unit production11. What is the major limitation of Wi-Fi?a. high costb. productivityc. short range of distanced. privacy concerns12. Land, building and equipment are _____________.a. depleted assetsb. assetsc. liquid assetsd. current assetsUnit 4 Examination177BAM 105 Introduction to Business13. _____________ represent the total cost of obtaining
materials for making the products sold bya firm during the year.a. Net profitsb. Revenuesc. Cost of goods soldd. Operating expenses14. _____________ expenses result from activities related to
selling goods or services.a. Grossb. Sales and marketingc. Incomed. Revenue15. The _____________ is the financial statement describing
a firms yearly cash receipts and cashpayments.a. statement of retained earningsb. cash flow statementc. balance sheetd. income statement16. Howard Industries is having a CPA firm review its
financial records to confirm theirconformance with generally accepted accounting principles.
Howard Industries is in theprocess of a(n) _____________.a. company-wide analysisb. portfolio analysisc. auditd. preliminary examination17. A _____________ is a promise by a bank to pay a foreign
firm a certain amount of money ifspecific conditions are met.a. letter of creditb. bankers acceptancec. currency exchanged. financial advisement18. About how many ATMs are located in U.S. bank buildings
and other locations?a. 20,000b. 360,000c. 120,000d. 550,000Unit 4 Examination178BAM 105 Introduction to Business19. Because the U.S. dollar varies only slightly in its
ability to purchase goods, it is considered_____________.a. divisibleb. stablec. portabled. durable20. Money lets you measure the relative values of goods and
services. In so doing, money isperforming which of the following functions?a. determination factorb. store of valuec. measure of worthd. monetary flagging21. Which of the following statements is NOT true about
dividend payments?a. During bad years, companies are still required to pay
dividends.b. Many fast-growing companies use cash earnings for
expanding the company so thatfuture earnings can grow even faster.c. Many companies distribute between 30 and 70 percent of
their profits to shareholders.d. Some firms, especially fast-growing companies, do not pay
dividends.22. A(n) _____________ fund nearly matches the performance
of a particular market.a. indexb. balancedc. aggressived. market23. A(n) _____________ is a summary of price trends in a
specific industry and/or the stock marketas a whole.a. average indexb. market indexc. investment indexd. market indicator24. What is the formula for measuring a firms working
capital?a. current assets = working capital – current liabilitiesb. current liabilities = current assets – working capitalc. working capital = current assets – current liabilitiesd. None of the above.Unit 4 Examination179BAM 105 Introduction to Business25. A _____________ is a formal pledge (an IOU) obligating
the issuer to pay interest periodicallyand repay the principal at maturity (a preset future date)
to the lender.a. bond indentureb. commercial bank loanc. mutual fundd. corporate bond”