Business And Its Environment 7th Edition by Baron – Test Bank

Chapter One:

Market and Nonmarket Environments

True/False Questions:

1)    Firms have more control over their future in their nonmarket environment than they have in the markets in which they operate.

Answer: False

Page reference: 1

Difficulty: Easy

AACSB:

Learning Outcome: Describe the components of the management environment

2)    The long-run sustainability of competitive advantage requires managing effectively in the nonmarket environment.

Answer: True

Page reference: 1

Difficulty: Easy

AACSB:

Learning Outcome: Describe the components of the management environment

3)    Effective management in the market environment is sufficient for superior performance of the firm over its competitors.

Answer: False

Page reference: 2

Difficulty: Moderate

AACSB:

Learning Outcome: Describe the components of the management environment

4)    The nonmarket environment is characterized by the social, political, and legal arrangements that structure interactions outside of, but in conjunction, with markets and private agreements.

Answer: True

Page reference: 2

Difficulty: Easy

AACSB:

Learning Outcome: Describe the components of the management environment

5)    Activities in the nonmarket environment may be voluntary, as when the firm cooperates with government officials or an environmental group, or involuntary, as in the case of government regulation or a boycott of a firm’s product led by an activist group.

Answer: True

Page reference: 2

Difficulty: Moderate

AACSB: