ETS MFT BUSINESS EXAM

ETS MFT BUSINESS EXAM

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QUESTIONS AND CORRECT ANSWERS/ ETS

MFT BUSINESS EXAM

A company is considering producing a product for a new market. The fixed costs required for manufacturing and delivering the product is $50,000. Labor and material costs are estimated to be approximately $25.00 per product. If the product

is sold for $35.00 each, the firm's break-even volume would be:

• 50,000 units

• 5,000 units

• 2500 units

• 500 units - ANSWER-B

A problem associated with equity theory is that:

• it focuses on providing incentives for the long run when most workers are

mainly concerned with incentives that apply to their current situation

• managers have a hard time applying it to real-world situations because of its

abstract nature 1 / 4

• worker motivation is based on perceptions of fairness, and the perceptions

workers have about their contributions are not always accurate

• it is concerned with the nature of the job itself rather than with what motivates

the workers who perform the job - ANSWER-C

All of the financial statements are for a period of time except the

a) Income statement

b) Owner's equity statement

c) Balance sheet

d) Statement of cash flows - ANSWER-C

The principal difference between variable costing and absorption costing centers

on:

• whether variable manufacturing costs should be included as product costs

• whether fixed manufacturing costs should be included as product costs

• whether fixed manufacturing costs and fixed selling and administrative costs

should be included as product costs

• / 4

• none of these. - ANSWER-B

General Bikes is debating which marketing research options to employ. The traditional person-to-person methods have been effective; however, the new director of market research is campaigning for online-based research. What argument for this method might he/she use?

a) Consumers are more relaxed at home in front of their computers, therefore it is

more likely the responses will be truthful

b) Online research has been standardized for each industry, making it easier to

understand them

c) A well-designed, Internet-based marketing research project can cost less and

yield information faster than offline research

d) Person-to-person methods most often incorporate researcher bias into the

surveys and observations - ANSWER-C

Which of the following is an appropriate Federal Reserve action to stimulate the United States economy?

a) Selling government bonds on the open market

b) Increasing the discount rate

c) Reducing the reserve requirement

• / 4

d) Cutting taxes - ANSWER-C

A small number of people with complementary skills who are committed to a common purpose, a set of performance goals, and an approach for which they hold themselves mutually accountable is referred to as a

• committee

• task force

• group

• team - ANSWER-D

By assembling computers only after customers have paid them for, resulting in a

lower finished goods inventory, Dell Computer Co. achieved:

a) Increased quality

b) A competitive advantage

c) Increased responsiveness

d) Increased innovation

e) None of the above - ANSWER-B

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