Study Guide

Field 010: Career and Technical Education—Business and Information Technology
Sample Multiple-Choice Questions

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Objective 0001
Business and Human Resources Management (Standard 1)

1. In the traditional pyramidal form of organizational structure, each person reports to one and only one supervisor. This principle, known as unity of command, is deliberately violated in which of the following types of organizational structures?

  1. divisional structure
  2. matrix structure
  3. functional structure
  4. product structure
Answer
Correct Response: B.
This question requires the examinee to demonstrate knowledge of types and characteristics of business organizational structures. The unity of command is the principle that employees report to one and only one supervisor. In the matrix organizational structure, employees may report to two or more supervisors and are grouped by both product and function.
Objective 0001
Business and Human Resources Management (Standard 1)

2. In which of the following cases would a worker most likely fail to qualify for unemployment benefits in Indiana?

  1. The worker was fired for stealing from the business.
  2. The worker worked fewer than 40 hours per week.
  3. The company laid off the worker due to outsourcing.
  4. The company laid off the worker but offered a severance package.
Answer
Correct Response: A.
This question requires the examinee to demonstrate knowledge of strategies and practices pertaining to employee compensation and benefits and government agencies, laws, regulations, and policies affecting human resources management. In the state of Indiana, individuals qualify for unemployment benefits if they are unemployed through no fault of their own. Therefore, when a worker is fired for stealing from a business, they will not be eligible for unemployment benefits.
Objective 0002
Entrepreneurship and Business Ownership (Standard 2)

3. In a limited partnership, the limited partner or partners:

  1. put in less money or other capital than the general partners when starting the business.
  2. receive a set return on their investments rather than a share of any business profits.
  3. do not take part in managing the business or participating in business decision making.
  4. are added to the business as partners after the business has already been established.
Answer
Correct Response: C.
This question requires the examinee to demonstrate knowledge of types and characteristics of business ownership, including sole proprietorships, partnerships, corporations, franchises, and cooperatives. A limited partnership is a type of business structure which includes one or more general partners and limited partners. General partners manage the business, assume legal debts and obligations, and take part in the business decision-making process. Limited partners are liable only to the extent of their investments and do not take part in managing the business or participating in business decision making.
Objective 0003
Business Communication (Standard 3)

4. One advantage of using voice over IP (VoIP) software rather than a traditional phone service is that:

  1. emergency calls can be placed more reliably during severe power outages.
  2. the incoming and outgoing audio quality of phone calls is consistently superior.
  3. the identity of an incoming caller can be revealed before the phone is answered.
  4. phone calls among Internet-enabled devices are free.
Answer
Correct Response: D.
This question requires the examinee to demonstrate knowledge of characteristics, applications, operation, advantages, and disadvantages of various types of communications technologies, including emerging technologies, used in business contexts. Voice over IP (VoIP) software is a type of technology that allows individuals to make phone calls using a broadband Internet connection instead of a regular phone line. Therefore, an advantage of using voice over IP (VoIP) software rather than a traditional phone service is that phone calls among Internet-enabled devices are free of charge.
Objective 0004
Financial Management, Accounting, and Business Math (Standard 4)

5. An importer of fair-trade coffee beans sets aside a 6 percent bonus of its net profits to help build schools in the towns where its coffee-growing cooperatives are located. The company works with 40 cooperatives and each cooperative receives an equal share of the bonus distribution. If the company made a net profit of $3,200,000 in the previous year, how much will each of the cooperatives receive as a bonus?

  1. $2,400
  2. $4,800
  3. $24,000
  4. $48,000
Answer
Correct Response: B.
This question requires the examinee to demonstrate knowledge of the application of basic computational skills, including percents, decimals, and fractions, to solve problems in various business contexts. If the importer sets aside a 6 percent (6/100 = 0.06) bonus of its net profit of $3,200,000, then that amounts to 0.06 × $3,200,000 = $192,000. The company works with 40 cooperatives and each receives an equal share of the bonus distribution and $192,000/40 = $4,800. Therefore each cooperative would receive $4,800 as a bonus.
Objective 0005
Personal Financial Literacy (Standard 6)

6. A college student wants to establish a credit history in order to apply for a car loan or mortgage in the future. Which of the following strategies would be most effective in helping the student establish a credit history?

  1. establishing a checking account at a bank and using a debit card to pay most bills
  2. applying for student loans to help pay for tuition at the school that the student is attending
  3. applying for a credit card with a small maximum and paying the balance in full each month
  4. obtaining a part-time job and having his or her paycheck deposited directly into a checking account
Answer
Correct Response: C.
This question requires the examinee to demonstrate knowledge of types of financial services offered by banks and other financial institutions; characteristics, advantages and disadvantages of various types of credit; and strategies for managing credit and debt. A credit history is a record of a consumer's ability and demonstrated responsibility in repaying debts to verify that the consumer is financially responsible. A credit card is an unsecured loan. Therefore, applying for a credit card with a small maximum and paying the balance in full each month would be the most effective strategy to help the student establish a credit history.
Objective 0006
Business and Personal Law and Ethics (Standard 5)

7. Which of the following cases would most likely be heard in a civil court?

  1. A manufacturer of cell phones charges that components delivered by a supplier did not meet the specifications that both companies agreed to in a contract.
  2. Before making a public announcement, the CEO of a small pharmaceutical company sells his stock in the company after learning that the FDA will soon reject the company's newest drug.
  3. A stockbroker uses an investor's money to pay off her own personal debts after promising to invest the money in energy stocks.
  4. A spark plug sales agent offers the purchasing agent for a lawnmower manufacturer a 10 percent kickback if spark plugs are bought exclusively from the sales agent's company.
Answer
Correct Response: A.
This question requires the examinee to have a broad and comprehensive understanding of legal terminology and procedures; sources of the law; civil and criminal law; and the structure of federal, state, and local court systems in the United States. Civil courts deal with non-criminal cases. A legal dispute between two parties will be heard in a civil court. A contract dispute is not a criminal case, so the dispute between the cell phone manufacturer and supplier is not a crime and would be decided in civil court.
Objective 0006
Business and Personal Law and Ethics (Standard 5)

8. One of the most important functions of negotiable instruments is to:

  1. set interest rates on various types of credit.
  2. establish the relative value of different currencies.
  3. serve as a substitute for money.
  4. allow sellers and buyers to agree on prices for goods and services.
Answer
Correct Response: C.
This question requires the examinee to demonstrate knowledge of functions and uses of commercial paper and the laws and regulations pertaining to credit, taxes, and bankruptcy. A negotiable instrument is a document of an amount of money, or a title, which is unconditionally transferable from person to person as a substitute for money. Some specific examples of negotiable instruments include checks, promissory notes, bearer bonds, and certificates of deposit. Therefore, one of the most important functions of negotiable instruments is to serve as a substitute for money.
Objective 0007
Economics (Standard 7)

9. Use the graph below to answer the question that follows.



Which of the following will most likely cause the supply curve for labor to shift to the left?

  1. A decrease in aggregate demand leads to a decline in the gross national product and increased layoffs of workers by companies.
  2. The national government subsidizes an increase in the length of time that unemployed workers can collect unemployment.
  3. A drop in the stock market reduces investments of many middle-aged workers forcing them to work longer before retiring.
  4. The high cost of college tuition forces more high school graduates to forgo college and enter the labor market immediately upon graduating.
Answer
Correct Response: B.
This question requires the examinee to have a broad and comprehensive understanding of major economic theories and their influence on the formulation of public policy. A left-shift of the labor supply indicates that the supply of labor has decreased—there are less people employed or actively looking for employment for a given amount of labor demand. By the law of supply and demand, wages will increase. If unemployed workers continue to receive unemployment benefits, they have less incentive to actively look for employment and will reduce the labor supply, causing wages to increase.
Objective 0008
Marketing and International Business (Standard 8)

10. Which of the following primarily determines whether one country has a comparative advantage over another country in producing a particular product?

  1. the opportunity cost for producing the product in each country
  2. the maximum supply that can be produced of the product in each country
  3. the total diversity of other products that can be produced in each country
  4. the number of domestic competitors producing the product in each country
Answer
Correct Response: A.
This question requires the examinee to demonstrate knowledge of economic factors, including absolute and comparative advantage, opportunity costs, resource availability, and competition, that shape and affect international business, marketing, and trade. Comparative advantage refers to the idea that in order to maximize its gain in trade, a country should choose to produce the product that minimizes the total costs that must be given up to produce a product. These costs, which must be given up when a choice is made, are called opportunity costs.
Objective 0009
Information Technology: Computer Applications, Data Management, and Programming (Standard 9)

11. Which of the following statements describes a drawback to using different operating systems on the various computers within a single business?

  1. Some Web sites may not be accessible to all of the operating systems in use at the business.
  2. A separate computer network must be created for each operating system used in the business.
  3. Each computer purchased by the business must be compatible with all of the operating systems.
  4. Computers using different operating systems may not be able to run the same software packages.
Answer
Correct Response: D.
This question requires the examinee to demonstrate knowledge of terminology, components, operations, and applications of computer hardware and peripherals, operating systems, and utility programs. The costs of buying, operating, maintaining, and supporting different software can make it challenging to operating a business. Consequently, a drawback to using different operating systems on various computers within a single business is that computers using different operating systems may not be able to run the same software packages.
Objective 0009
Information Technology: Computer Applications, Data Management, and Programming (Standard 9)

12. Voice recognition software could most likely benefit a business by:

  1. reducing spelling and grammatical errors in business documents.
  2. strengthening communication between employees and managers.
  3. increasing the productivity of employees who perform data entry.
  4. enabling the company to hire individuals with certain disabilities.
Answer
Correct Response: D.
This question requires the examinee to demonstrate knowledge of types and characteristics of emerging technologies and procedures for employing these technologies in various business contexts. Voice recognition software substitutes voice entry for keyboard entry and works by analyzing sounds and converting them to text. Additionally, voice recognition software can be utilized to carry out computer commands. This specific type of software can be a valuable tool for individuals with certain types of disabilities to use to help them complete various tasks. Businesses would benefit from voice recognition software because it would enable them to hire individuals with certain types of disabilities.
Objective 0010
Information Technology: Networking and the Internet (Standard 10)

13. A company would most appropriately advertise through social networks when it wishes to:

  1. link a new product to an already established product.
  2. direct its appeal to a particular demographic or target audience.
  3. market to customers who have bought products from them in the past.
  4. reach an audience with a broad range of socioeconomic levels.
Answer
Correct Response: B.
This question requires the examinee to demonstrate knowledge of strategies for pricing, promoting, and selling products and services on the Internet and for using emerging Internet technologies and procedures for Internet marketing. Social network advertising is a term that is used to describe a form of online advertising that focuses on social networking sites. Social networking sites require individuals to provide personal information when they sign up for membership. This allows advertisers to take advantage of the users’ demographic information and target their ads appropriately.
Objective 0011
Business and Information Technology Careers and Career Development (Standard 11)

14. Which of the following statements best describes a benefit to attaching a cover letter to a résumé when applying for a job?

  1. Employers can refer to a cover letter to quickly find an applicant's contact information.
  2. Applicants can use cover letters to provide a narrative about their life experiences.
  3. Cover letters can highlight an applicant's qualifications and writing ability.
  4. Information that does not fit on a one-page résumé can instead be placed in a cover letter.
Answer
Correct Response: C.
This question requires the examinee to demonstrate knowledge of strategies and techniques for locating open information technology and business-related career positions, creating an effective résumé, and completing successful interviews. A résumé is a document which summarizes and outlines a job applicant's education, employment experience, and various skills. A cover letter is a written document attached to a résumé which provides additional detailed information about a job applicant's specific qualifications, experiences, and skills related to the position. Furthermore, a cover letter explains the applicant's reasons for interest in the job position and further highlights both an applicant's qualifications and writing ability.
Objective 0012
Core Knowledge and Skills for Business and Information Technology Teachers (Standard 12)

15. Which of the following is likely to be the most effective strategy for the adviser of a student in a work-based learning environment to use in assessing student progress and learning during his or her school-to-work experience?

  1. scheduling several tests and quizzes during the year to evaluate student learning
  2. regularly meeting with the student and his or her supervisor for progress reports
  3. interviewing other workers who work with the student about the student's behavior
  4. arranging with the business to observe the student several times at work during the day
Answer
Correct Response: B.
This question requires the examinee to demonstrate knowledge of strategies and techniques for coordinating and supervising students' school-to-work experiences and for assessing student learning during their school-to-work experiences. Work-based learning is learning that is based on the needs of a student's chosen career, field of study, or employer. An advisor of a student in a work-based learning environment works with the student and his or her supervisor to help plan, assess, and monitor the student's learning experiences. Therefore, regularly meeting with the student and his or her supervisor for progress reports would be the most effective strategy for the advisor of a student to use in assessing student progress and learning during his or her school-to-work experience.