WSJ Questions Exam #2

Section #1

1. What is the inspiration behind the new HP laptops?
A. Lenovos Thinkpad
B. Apples MacBook Air
C. Dells Ultrabook

2. Who is the CEO of Hewlett-Packard Co.?
A. Meg Whitman
B. Steve Jobs
C. Ginni Rometty

3. What is the new technology is taking over the computer industry causing stagnant sales
of laptops?
A. iOS 6
B. Tablets
C. Windows 8

1. What effect does the Federal Reserves new round of bond purchases have on the yield
of mortgage-backed securities bonds?
a. It keeps the yield low for the foreseeable future
b. It raises the yield for the foreseeable future
c. The yield will remain approximately the same
d. The yield will skyrocket to new highs.

2. In what ways does the Feds buying $40 billion a month in mortgage securities support
banks?
a. It boosts the confidence of businesses to invest and it may also help to
underpin the nascent housing recovery.
b. It lessens the confidence of businesses to invest and sends the consumers into a
state of panic.
c. It lessens the confidence of businesses but increases the confidence of banks.
d. It boosts the confidence of businesses but would hurt the housing recovery.

3. Who is the biggest beneficiary (as discussed in the article) of the move by the Federal
Reserves recent move to bolster markets?
a. The individual consumer
b. Small businesses
c. Big financials
d. The European Central Bank

4. The Feds buying of mortgage securities (bonds) is an example of
a. Fiscal policy
b. Monetary policy
c. Quantitative refinancing
d. None of the above


1. What do the failures of companies such as Home Depot tell us about Chinese-consumer
culture?
a. There is a greater demand for non-durable goods than durable goods amongst the
Chinese consumers.
b. The tastes of the Chinese consumers are different than those of the American
consumers (reflected by the companies first business model).
c. There is a lesser demand for do-it-yourself products in China than in America.
d. All of the above are correct.

2. What is Home Depots current approach in order to survive in the Chinese market?
a. Liquidate all the investments made in China
b. Close all stores
c. Focus on opening specialty stores
d. Implement the business model used in the US

3. What aspect of Chinese market trends did Home Depot fail to anticipate?
a. Chinese consumers were not willing to pay the high prices associated with Home
Depots products
b. Chinese consumers believed Home Depots goods to be inferior to other brands.
c. Chinese consumers would prefer to pay someone to assemble their goods
rather than assemble it themselves.
d. Chinese consumers have no need for home improvement products because the
Chinese government provides them free of charge.


1. What was the cause of the growing tension in the Sino-Japanese relations?
a. The value of the stock of Facebook falling to less than 50% of the initial price
offering
b. The release of an anti-Islam video that sparked controversy
c. Chinese anger over the Japanese purchase of a set of East Japanese islands
d. The assassination of a Japanese businessman by a Chinese officials wife

2. Which of the following car companies temporarily suspended operations in
China?
a. Nissan
b. Toyota
c. Honda
d. All of the above

3. What forecasted effect does the Sino-Japanese tensions have on the Japanese
economy?
a. A drop in GDP
b. A slight rise in GDP
c. A doubling of GDP
d. No effect on GDP

1. How does the CEO of Netflix plan to broaden its customers base?
a. By making streaming service better
b. Expanding through globalization
c. Eliminating the distribution of DVDs
d. Both a and b
2. If it is costly for Netflix to expand overseas, what is the driving force for Netflix to
expand its markets overseas?
a. Most of Netflixs investors are overseas
b. International entertainment markets are more profitable than the domestic
market
c. Although expansion is costly, it creates more difficult for other
companies to compete against Netflix
d. Netflix has no intention of expanding overseas.
3. What is Netflixs main focus to gain a competitive advantage over companies like
Hulu and Amazon?
a. Increasing variety of content
b. Branding
c. Ensuring superior user experience
D. All of the above


1. Why will Chinas labor force be shrinking in the years ahead?
A. The population of China is decreasing
B. The economy is growing slower, so not enough jobs will be provided
C. Generational shift
D. All of above
2. What is the effect of the shrinking labor force market in China?
A. Sharp increase in wages
B. Improvements in worker benefits
C. Squeezed net margins of companies
D. All of above
3. What does Hon Hai Precision Company do to contain its costs?
A. Move its production to cheaper locations inland
B. Close one of its factories
C. Ask government for subsidy
D. All of above

1. What are the risks associated with CEOs going viral on social media networks such as
Twitter?
A. Increased public exposure
B. Hate-mail, spam, and complaints
C. Lawsuits, leaked trade secrets, and angered customers
D. Accusations of collusion and questionable ethics
2. What percentage of Americans use Twitter according to the article?
A. 50%
B. 22%
C. 10%
D. 34%
3. Which companys CEO does not have a presence on a social media network(s)?
A. Yahoo Inc.
B. Wright Express Corp.
C. News Corp.
D. General Electric Co.

1. American consumers as a whole have been spending more on goods recently because:

a. The average income rose in 2011.
b. Consumer prices on goods have increased.
c. Both a and b.
d. None of the above.

2. According to the article, consumer confidence has recently:

a. Remained steady.
b. Decreased.
c. Increased.

3. What is the biggest expense for most Americans?

a. Housing
b. Entertainment
c. Transportation
d. Food


1. What is/are the reason(s) H&M gave to explain its delay in launching?
A. H&M is having issues with security and information technology.
B. H&M still needs to fix problems with logistics and payments.
C. H&M wants to devote attention to a planned global online rollout.
D. All of the above.
2. According to research firm Barclays, why should the US launch be one of H&Ms
most important country specific launches?
A. The significance of the market in H&Ms sales.
B. The taste of US customers matches H&Ms style.
C. The market size of online fashion retail is large in the US.
D. A and C
3. According to Sydbank analyst Nicolaj Jeppesen, why is the delay disappointing?
A. H&M still need to wait longer before it can generate revenue by online retailing.
B. H&Ms competitors, like Inditex, gain an advantage in the competition
because they are in the market when H&M is not.
C. H&Ms stock price fell after releasing this decision.
D. None of the above.

Group 22 Section 1

1) Who will assume the position of Chief Executive of Pearson after current Chief Executive
Marjorie Scardino steps down?

A) Claudio Aspesi
B) Mark Zuckerberg
C) John Fallon
D) Glen Moreno

2) What is the probable amount of income Pearson would earn from selling one of its
consumer assets, the Financial Times?

A) one billion dollars
B) two hundred million dollars
C) five hundred million dollars
D) two billion dollars

3) Penguin, another consumer asset of Pearson, accounted for what percent of the
companys total sales in the last year?

A) 23%
B) 35%
C) 15%
D) 20%

Group 23 Section 1

1. Who was the top-selling automobile maker in Brazil in August?
a. Fiat
b. Volkswagen
c. General Motors
d. Dodge
2. What percent of Brazils economic output does their auto industry account for?
a. 7%
b. 20%
c. 42%
d. 68%
3. What happened when the government introduced a series of temporary tax breaks for
the auto industry earlier this year?
a. It had no effect on the auto industry.
b. There was a boom in sales that lasted throughout the year.
c. It led to a surge in sales, particularly in August, but sales slumped again in
September.
d. Sales immediately fell to an all-time low.

Group 24 Section 1

1. In the twelve months prior to June 30, why did T-Mobile lose 1.7 million contract
customers?

i. Because the companys cellular contract rates were too high.
ii. Because the company does not sell the iPhone.
iii. Because of poor customer service.
iv. Because of the companys lack of LTE technology.

2. The transaction between T-Mobile and its smaller rival MetroPCS is structured as:
i. A reverse merger.
ii. A leveraged buyout acquisition.
iii. A joint venture business deal.
iv. A vertical integration merger.

3. After the completion of the merger, T-Mobile will:
i. Become the largest wireless cell phone service provider in the United
States.
ii. Become a more competitive wireless carrier in the United States
market.
iii. Be known as MetroPCS.
iv. No longer operate in the United States.

Group 25 Section 1

1. The Federal Housing Administration has historically backed loans to which types of
borrowers?

A. High-risk buyers and borrowers who have defaulted before.
B. First-time buyers and those with low income.
C. Low-risk buyers and those with a record of paying back loans.
D. All kinds of borrowers.

2. Wells Fargos solid performance during the financial crisis allowed it to acquire which
company?

A. Wachovia
B. Bank of America
C. J.P. Morgan Chase
D. Capital One

3. Which of these banks did not face lawsuits in 2012 over fraud or faulty mortgages?

A. Wachovia
B. Bank of America
C. J.P Morgan Chase
D. They all faced lawsuits over fraud or faulty mortgages.

Group 26 Section 1

1. How is Amazon planning on profiting from this venture?

A. Return from interest
B. Commission from higher sales volume
C. Raising commission rates
D. Both A & B

2) Why are small businesses hesitant to use Amazons lending program?

A. Interest rates are too high.
B. There is a risk of losing inventory that Amazon stores in their facilities.
C. Banks are offering an overabundance of loans.
D. They are worried they might increase their inventory too much.

3) Why is PayPal considering entering the third-party lending market?

A. PayPal is turning into a bank.
B. PayPal sees the potential for profit in a relatively untapped market.
C. PayPal wants to pay its pals in the form of offering them loans.
D. PayPal is a subsidiary of Amazon.

Group 27 Section 1

What percentage of Wal-Marts total revenue is made up from its online sales?
A) 5%
B) 10%
C) 1%
D) 3%

Which of the following is not a city that Wal-Mart will be offering its new same-day
delivery service in?

A) Philadelphia
B) Chicago
C) San Francisco
D) Minneapolis

Why do analysts believe that Amazon has a competitive advantage in the e-commerce
industry?

A) Amazon has more physical stores than Wal-Mart does.
B) Amazon has access to faster shipping methods.
C) Amazon is given preferential treatment by US Government regulators.
D) Amazon ships from warehouses, which is much cheaper than shipping from stores,
as Wal-Mart does.


Section #2

1. Why is Mexico a better place than China to produce cheap goods?
A. Chinas rising wages
B. Mexicos natural resources
C. Culture barrier between China and America
2. What is holding Mexico back from becoming a globalized market?
A. Location
B. Violence
C. Deteriorating competitive advantage
3. What industry is booming in Mexico?
A. Clothing
B. Technology
C. Automobile
D. Agriculture

1. The media ecosystem is teeming with Apple news because:

A. Apple spends a large amount of its budget on advertisements

B. Androids are an inferior product and therefore not worth covering

C. Media outlets gain immediate ratings boosts by covering Apple


2. Apple spends most of its marketing budget on internet and digital advertising because:

A. Advertising on the internet tends to be much cheaper than on television or in print

B. It wants to put its messages in front of its largest consumer base

C. It thinks that print advertising is outdated and irrelevant


3. Some bloggers and editors criticize Apple coverage in the tech universe because:

A. Writers often neglect other tech news in favor of Apple because of ratings and hits

B. Much of the coverage is hypothetical and misleading

C. Apple secretly perpetuates coverage by bribing bloggers



1. Which of the following is a negative consequence of natural gas exportation by the
United States?
A. No negative consequence
B. Create rival organizations or cartels similar to OPEC
C. Economic decline
D. Political tension

2. What is alternative to exporting only liquid natural gas (LNG)?
A. No alternative, LNG cant be converted to anything else
B. Exporting oil
C. Exporting coal
D. Exporting liquid fuel methanol

3. If the United States were to sell its liquid natural gas (LNG) surplus, how would that
affect domestic prices of LNG?
A. No effect, prices would remain the same
B. Domestic prices of LNG would likely decrease due to the selling of surplus
C. Domestic prices of LNG would likely increase due to the selling of surplus
D. Domestic prices would drop to zero


1. If Obama wins the coming election, what will happen to gun sales in the short run?
a. They will decrease due to the laws that will be enacted by the Obama
administration.
b. They will remain the same because the same president will still be in office.
c. They will rise due to the perceived threat to consumers freedom of gun
ownership.
d. They will decrease due to newer alternatives that will be introduced into the
market.

2. If Romney wins the coming election, Cabela will most likely increase their stock in?
a. Waterproof boots and camouflage hunting gear
b. Pistols
c. Machine guns
d. Revolvers

3. As demand for guns has dramatically risen, supply has
a. Increased due to stores anticipating buyers actions
b. Not been able to keep up
c. Remained the same
d. Increased due to decrease in cost of manufacturing firearms


1. What new development in antitrust cases will other companies notice?
a. Justice Departments push for a corporate monitor
b. Prosecutors proposed penalties for profitable price-fixing conspiracies of
10-year prison terms for executives and a fine of $1 billion against the
company
c. The Judge requiring the company to pay $500 million immediately,
prompting banks to demand immediate payment on billions of dollars in
loans.

2. Why did prosecutors propose such penalties?
a. To help repair the US Market
b. They wanted to deter large, highly-profitable price-fixing conspiracies
in the future
c. To compensate the companies they had overcharged
d. They wanted to put the company out of business

3. Which company was NOT involved in the LCD price fixing scandal?
a. Samsung
b. Nokia
c. LG
d. AU Optromics


1. Why could Mr. McDonalds (the CEO of Procter & Gamble) job be at risk?
A. His analysis for the fiscal year did not match the company plan
B. If the cost cutting and product-refocus plans he announced do not deliver
results
C. He took a leave of absence and decided to vacation in the Bahamas
2. What is the most important market (1/3 of sales) for Procter and Gamble?
A. Honduras
B. Australia
C. Brazil
D. United States
3. In what way have former executives been critical of Mr. McDonald?
A. He had no comprehension of the market
B. He watched ESPN instead of executing conference calls
C. Long meetings and few decisions being made have brought questions to his
management style
D. He wanted to go against the skin cream investment

1) Harley Davidsons production has recently been
a) *Centralized and streamlined*
b) Decentralized across the country
c) Outsourced
d) Largely stayed the same

2) Another way Harley Davidson has cut its production costs has been by
a. Being more strict with employees
b. *Introducing less rules and regulations for employees to follow*
c. Introducing and producing more products
d. None of the above

3) Experts predict Harley Davidsons imposed changes will
a. Cause more competition
b. Cause decreased profits
c. *Cause increased profits*
d. None of the above

1. Apple conducting business in multiple countries displays .
a. Globalization
b. Supply and Demand
c. Conglomeration
d. Innovation
2. Samsungs Galaxy S III is a of Apples iPhone 5.
a. Competitor
b. Acquisition
c. Trade Partner
d. Subsidiary
3. The new operating software and additional features of the Apple iPhone 5 are a result
of .
a. Management
b. Appreciation
c. Innovation
d. Cost-push Inflation

1. What was RadioShacks former business plan to stay competitive in the electronics
market?

A. Release products more often
B. Form joint ventures with other electronics retailers such as Apple
C. Focus on retailing higher-end tablets and smartphones
D. Shift completely to online sales


2. What was one major misstep that James F. Gooch took that led to his inability to
effectively run the company?

A. He adopted outdated strategies from the former CEO and struggled to
implement them in a current market
B. He refused to collaborate with his chief officers on important financing decisions
C. He focused on exclusively on domestic markets rather than expanding to
international ventures
D. He was ignorant of the necessities and desires of both customers and suppliers.

3. What happened following the 16% drop in the NYSE on Tuesday, September 25
th
?

A. The next day, the Dow Jones Indices added RadioShack it midcap index once again.
B. The next day, half of the 16% deficit was already recovered.
C. The next day, it fell another 16%.
D. The next day, there was a minor increase in share value.

1. What are underwater homeowners?
A. Homeowners whose homes are being foreclosed by the government
B. Homeowners in the process of moving but own two homes at one time
C. Homeowners who owe more on their mortgages than their homes are actually
worth
D. Homeowners who pay high costs for food insurance
2. What problem do prospective homeowners face that will make it difficult to secure
record-low mortgage rates?
A. Tightened credit restrictions
B. Inability to receive bank loans
C. A high priced housing market
D. A recession
3. What could encourage homebuilders to increase construction and benefit the overall
economy?
A. Increasing prices and solid sales
B. More vacant land to begin construction
C. Higher priced housing so they make more commission on each house sold
D. Higher demand for cars

1. What has Harley-Davidson done to promote efficiency in its value chain?

A. Promote flexibility in job descriptions
B. Consolidate production and facilities
C. Trimming the workforce and applying more automation
D. All of the above

2. What has Harley-Davidson done to recover from losses in the recession?

A. Change their business model
B. Change their business strategy
C. Increase production
D. Moved their factories to Kentucky

3. How has Harley-Davidson kept up good relations with its workers in hard times?

A. Agreeing to not move the plant in favor of gaining more cost control
B. Raising pay for workers
C. Increasing benefits for workers
D. More expensive severance packages

1. Why is the launch weekend of a new device for Apple so closely watched?

a) It is a measure of the companys momentum
b) It shows how much money the company has
c) It determines if the device will be profitable or not
d) It shows the motives of the company

2. How many iPhone 5s were purchased in stores, within the first 3 days of sales?

a) More than 2 million units
b) More than 5 million units
c) Less than 1 million units
d) More than 10 million units

3. What could explain the shortage, and failure to meet opening demand?

a) The company is encountering shortage of displays and handset chips
b) Apple shortened its production schedule before the release date to avoid leaks
c) Both a and b
d) None of the above

Group 26 Section 2
1. What is the incentive for YouTube partners to use Google+?
a. Facebook will make millions of dollars.
b. An increase in views and subscribers.
c. Google as a corporation will fail without their partnership.
d. None of the above.
2. What is the investors opinion of Google+?
a. It will not be very successful.
b. It will make huge amounts of profits.
c. It will be a strong competitor of Facebook.
d. None of the above.
3. How many Google+ users are currently active?
a. 45
b. 400 million
c. 250 million
D. 100 million

Group 27 Section 2
1) Why might McDonalds be filing for a trademark on their coffee?
a. To enter the packaged coffee business
b. To prevent competitors from using it
c. To make it more popular
d. A & B
2) The US packaged coffee industry is a business currently valued at what price?
a. $5.6 billion
b. $9.3 billion
c. $13.7 billion
d. $17.4 billion
3) McDonalds does not currently faces competition from which of the following
companies:
a. Burger King Worldwide Inc.
b. Wendys Co.
c. Folgers Coffee Co.
d. Panera Bread Co.

Group 28 Section 2
1. What Japanese company did Wal-Mart acquire to assist its operations in Japan?
A. Carrefour SA
B. Seiyu
C. Tesco
2. Wal-Marts customer base for discount retail has been growing mainly due to the
increase of Japanese
A. Pensioners
B. Single mothers
C. The unemployed
3. Wal-Mart maintains its low prices in Japan by doing all of the following except
A. Cutting out Japanese middle men
B. Paying Japanese workers extremely low wages
C. Using its global presence to import goods from other countries

Group 29 Section 2
1. Which of these companies focuses mainly on prepaid cellular phone plans?
a. Verizon Wireless
b. T-Mobile
c. MetroPCS
d. AT&T
2. Which one of these providers currently holds the most market share in the cellular
industry?
a. AT&T
b. MetroPCS
c. Verizon Wireless
d. Sprint
3. If the merger between MetroPCS and T-Mobile is permitted, what would the effect
be on the pre-paid cellular phone market?
a. No effect
b. Greater competition between small providers
c. The market will be increasingly dominated by big carriers like T-Mobile
and Sprint
d. Consumers will be less interested in pre-paid cellular phones

GROUP 30 IS MISSING.

Group 31 Section 2
1. Which company is Walmarts main rival in online retailing?
A. Target
B. Amazon
C. Ebay
D. Mcdonalds
2. Why is Walmart offering one-day shipping?
A. To be more competitive in the online shipping market
B. To expand its customer base
C. To adapt to change market trends.
D. All of the above
3. Why does Amazon have a competitive advantage over Walmart in the online industry?
A. It has been in the industry for a longer period of time.
B. It has a larger online customer base.
C. It generates more total revenue.
D. Both A & B

Group 32 Section 2
1. What percentage of Wal-Marts revenue was generated through online retail last
year?
A. 1%
B. 10%
C. 25%
D. 40%
2. What is the relationship between Wal-Mart and Amazon now?
A. Cooperator
B. Competitor
C. Separated business
D. Subsidiary
3. What is the new policy for Wal-Marts online retailer?
A. Price reduces
B. Same-day shipping delivery
C. New product
D. Big sales

Group 33 Section 2
1. Why were layaways not used until the recent downturn of the market?
A. People wanted their purchases immediately.
B. It was too difficult for businesses to store peoples items over a period of time.
C. People did not finish paying for the object, so companies lost money and ended up
having too much inventory.
D. Credit cards became popular and were a way for people to pay off their
purchase later.

2. Which is not one of the benefits that layaways programs bring to the retailers?
A. It helps retailers to get prepared for the increasing demand in certain products during
holiday season.
B. It makes expensive products more affordable to customers so that costumers will
spend more when using layaway programs, which will lead to an increase in retailers
revenue.
C. An increase in service fees charged to layaway programs makes retailers get
more profits.
D. Layaways require the customer to come into the store every few weeks, resulting in
more purchases from the customer.

3. Which of the following was not a way that companies successfully changed their layaway
programs for the 2012 holiday season?
a. Offering layaway earlier
b. Reducing fees associating with signing up for layaway
c. Letting shoppers reserve from the Hot List
d. Offering coupons to those who participated in layaway in earlier years