Deck 3: Media Economics

Question 1

Billionaire computer programming whiz Mark Zuckerberg created all of the following EXCEPT

A) AOL.
B) Facebook.
C) Facemash.
D) ZuckNet.

Answer 1

AOL.

Question 2

Since it became established nationwide, Facebook sustains itself financially by

A) advertising revenues.
B) cash from venture capitalists.
C) investments in its IPO.
D) sales of Facebook-trademarked merchandise.

Answer 2

advertising revenues.

Question 3

An economic system in which private owners operate businesses for profit is called

A) socialism.
B) capitalism.
C) fascism.
D) new-world economics.

Answer 3

capitalism.

Question 4

With rare exception, the primary goal of most U.S. mass media is to

A) make profits.
B) provide news and information to the masses.
C) entertain.
D) provide an exchange of ideas.

Question 5

Mass media industries earn most of their revenue from

A) subscriptions and advertising.
B) advertising and classifieds.
C) sales and subscriptions.
D) advertising and sales.

Question 6

What advertisers are really paying the mass media for is

A) publicity and prestige.
B) access to potential customers.
C) protection against financial stagnation.
D) conglomeration.

Question 7

When Gannett Corporation diversified and began acquiring radio and television stations, billboards, magazines, and other enterprises in addition to newspapers, it

A) became a newspaper chain.
B) moved into the category of media conglomerate.
C) surpassed Rupert Murdoch's News Corp. in size and revenue.
D) was able to reach an audience larger than Facebook's.

Question 8

One trait of media conglomerates is

A) eliminating boards of directors at any newly-acquired subsidiaries.
B) having day-to-day decisions for all subsidiaries made in one centralized, executive office.
C) ownership of subsidiaries that remain distinct operating entities.
D) ownership of some subsidiaries whose business does not involve communication.

Question 9

Conglomerates typically use all the following business practices EXCEPT

A) board-level micro-management of all aspects of their operations.
B) day-to-day decision-making is done by appointed middle managers.
C) major policy and profit-expectations are set by a board of directors.
D) performance-based evaluation systems treat under-achievers as expendable.

Question 10

The recession that began in 2007 resulted in

A) media conglomerates buying more companies.
B) media conglomerates experiencing increased profits.
C) media conglomerates merging with other conglomerates.
D) media conglomerates engaging in panic-driven divestiture.

Question 11

Media tycoon Rupert Murdoch controls a diverse media empire that includes the

A) Wall Street Journal.
B) New York Times.
C) Washington Post.
D Chicago Tribune.

Question 12

Rupert Murdoch, who controls News Corp. and other media ventures, is well known for his

A) disdain for opportunism.
B) lackadaisical approach in setting goals.
C) profit-driven motivation.
D) unwillingness to correct impetuous decisions.

Question 13

If Company XYZ produces a magazine solely for its employees, that publication is a

A) general-interest magazine.
B) sponsored magazine..
C) pulp magazine.
D) targeted-subscriber magazine. .

Question 14

Established in 1908, the Christian Science Monitor is sponsored by the

A) United Church of Christ.
B) Clergy for Science.
C) Christian Science Church.
D) Scientists for Christ.

Question 15

The Christian Science Monitor is known for its

A) solution-based journalism.
B) sensational coverage of world affairs.
C) preachy style of journalism.
D) crossword puzzle.

Question 16

Who founded the Christian Science Monitor?

A) Rupert Murdoch
B) Mary Baker Eddy
C) Helen Gurley Brown
D) Joseph Pulitzer

Question 17

Which of the following has NOT been considered as an alternative to traditional ways of funding mass media in the U.S.?

A) changing the U.S. tax code to encourage family ownership of media companies.
B) using excise taxes on other products to subsidize media companies..
C) transferring ownership from for-profit businesses to nonprofit foundations..
D) promoting university-based journalism centers as news producers..

Question 18

Skeptics fear that if community foundations took over the operation of local newspapers, the papers would

A) emphasize favorable publicity for the community instead of hard-hitting news.
B) increase the price for consumers.
C) not allow advertising of goods and services.
D) reduce thescope of their offerings and not cover as much non-local news.

Question 19

The largest example of a successful media cooperative is

A) the Christian Science Monitor.
B) NBC and MSNBC.
C) the Associated Press.
D) Comcast/NBCUniversal.

Question 20

The Associated Press began in 1848 as the Harbor News Association with the primary responsibility of

A) collecting information from foreign newspapers.
B) meeting transatlantic ships to pick up the mail for New York newspapers.
C) sharing news stories with other New York newspapers.
D) consolidating news coverage with press pools.

Question 21

One of the main financial concerns about nonprofit organizations purchasing newspapers is that

A) subscription sales would decrease.
B) advertisers would be resistant.
C) the cost of replacing aging printing presses would be more than nonprofits could bear.
D) employees would expect and demand improved and more expensive benefits.

Question 22

Because of its inherent high costs, many newspapers have abandoned

A) celebrity reporting.
B) financial reporting.
C) consumer reporting.
D) investigative reporting.

Question 23

Global News Enterprises, the Center for Public Integrity and ProPublica are examples of journalism-oriented

A) cooperatives.
B) subsidiaries.
C) nonprofits.
D) conglomerates.

Question 24

The Medill Innocence Project is probably the most widely-publicized program that relies on __________ to research and generate news content.

A) seasoned journalists on leave from their employer
B) university students
C) freelance journalists and lawyers
D) retired reporters and editors

Question 25

Family-owned media have increasingly declined in number because

A) fewer heirs are interested in media companies today than in the past.
B) inheritance taxes inhibit bequeathing the family business to heirs.
C) media chains are no longer interested in buying family-owned media.
D) recent changes in the law prevent transfer of ownership within families.

Question 26

One way U.S. government policy historically has NOT favored the print media over other types of business is

A) special reduced postal rates for printed materials.
B) favorable tax treatment for joint operating agreements between newspapers.
C) government subsidies to help newspapers pay for printing paper.
D) free delivery of weekly newspapers by the postal service.

Question 27

The first reduced U.S. postal rate for the mass media was created in

A) 1789.
B) 1845.
C) 1879.
D) 1903.

Question 28

Newspaper and magazines now qualify for special second-class postage rates if

A) they contain substantive news content.
B) less than 70 percent of their content is advertising.
C) they meet strict editorial guidelines.
D) they meet page-size and weight limits and are pre-sorted and bundled in ZIP code order.

Question 29

The 1927 Federal Radio Act authorized the federal government to

A) regulate the type of content that could be carried over the airwaves.
B) eliminate the National Association of Broadcasters.
C) provide tax breaks to keep financially-troubled radio stations on the air.
D) issued license to radio stations and regulate the over-crowded airwaves.

Question 30

The 1927 Federal Radio Act was based on the

A) scarcity model.
B) marketplace model.
C) capitalist model.
D) public-interest model.

Question 31

The National Association of Broadcasters was initially formed to

A) ensure that broadcasters received the same preferred tax treatment as newspapers.
B) prevent television stations from gaining an advantage over radio stations.
C) give advertisers one source where they can buy time on any radio or television station.
D) reduce the chaos of over-crowded airwaves by regulating radio broadcasters.

Question 32

The Newspaper Preservation Act of 1970 allowed newspapers to

A) deliver newspapers at reduced postage.
B) share editorial content.
C) combine non-news operations without violating anti-trust laws.
D) merge in a way that guaranteed at least one would financially survive.

Question 33

State laws in many states require each county to designate an existing paper as an "official newspaper" which then requires

A) the paper to report on all public meetings and policy decisions by government agencies.
B) the paper to provide equal coverage to all candidates for political office.
C) government officials to respond to questions from reporters for that paper.
D) government agencies to purchase advertising space in that paper for public announcements.

Question 34

Legals are

A) news items regarding police and courts.
B) paid advertising required by law.
C) marriage, divorce and business announcements.
D) on-air acknowledgments of non-commercial sponsors.

Question 35

Joan Kroc of the McDonald's fortune gave $200 million to

A) Columbia Broadcasting System.
B) National Public Radio.
C) Public Broadcasting System.
D) ProPublica.

Question 36

In terms of public broadcasting, underwriting means

A) paying for a public announcement that is required by law.
B) providing a generous non-cash donation..
C) making a contribution that receives on-air acknowledgements from the station.
D) paying a service charge to become a "member of the station."

Question 37

When PBS sells DVDs of its programs and spin-off products, this activity is

A) micromarketing.
B) advertising.
C) a fund drive.
D) an auxiliary enterprise.

Question 38

Historically, the transformation of a technological invention into a mass medium that successfully reaches a mass audience has largely been the result of

A) trial and error.
B) the clear vision of the inventor.
C) a pre-existing need or specific purpose for the invention.
D) a single massive infusion of cash.

Question 39

The first three phases in the process of turning a new technology into a successful mass media industry include all of the following EXCEPT

A) Inspiration - the spark of an idea about a new way to communicate, i.e., a new medium.
B) Invention - creating new equipment and/or processes needed to operate a new medium.
C) Entrepreneurship - developing a viable way to make money from a new mass medium.
D) Industry - imitators arise to compete with the pioneers in the new medium.

Question 40

The fourth of the five phases in the evolution of a mass medium from its infancy to being past its prime is called

A) Expansion.
B) Maturation.
C) Proliferation.
D) Stratification.

Question 41

Steve Jobs co-founded

A) Google.
B) Apple Computer.
C) Microsoft.
D) News Corp.

Question 42

An industry dominated by a few companies is called

A) a monopoly.
B) conglomerated.
C) an oligopoly.
D) saturated.

Question 43

The continuing trend in mass media ownership is the

A) consolidation into fewer but bigger companies dominating each industry.
B) resurgence of family-owned companies.
C) break-up of large companies into smaller spin-off ones.
D) increasing regulation of media ownership changes by the government.

Question 44

Trade groups usually are formed when

A) massive layoffs unite workers across company lines.
B) related companies unite to achieve common goals.
C) unions threaten a strike that will affect an entire industry.
D) business revenues decline.

Question 45

According to Andy Grove, the final stages of an aging industry follow a predictable three-stage course that occurs in the this order:

A) ignore new challenges, radical reforms, and resist change.
B) resist change, ignore new challenges, and radical reforms.
C) ignore new challenges, resist change, and radical reforms.
D) resist change, radical reforms, and ignore new challenges.

Question 46

The following are all trade groups EXCEPT

A) theMotion Picture Association.
B) the Association of American Publishers.
C) the Recording Industry Association of America.
D) the American Federation of Labor and Congress of Industrial Organizations.

Question 47

Critics concerned about how much influence mass media trade groups seem to exert on government regulators and the legislative process often point out

A) how ill-prepared the regulators are for doing their jobs.
B) that most media executives earn much larger salaries than the regulators.
C) the "Washington turnstile" that moves people back and forth between jobs in the media and government jobs as regulators for those same media.
D) the enormous political power and huge amounts of money that PACs and other special interest groups use in lobbying for new laws and regulations.

Question 48

Despite concerns about government involvement in the mass media, one of the best examples of the U.S. government offering direct financial support to mass media is

A) the BBC.
B) the Corporation for Public Broadcasting.
C) the FRC.
D) the Wall Street Journal.

Question 49

Wireless delivery of digitized messages may represent the ultimate level in

A) audience fragmentation.
B) decentralization of media ownership.
C) mass media technology.
D) speed and ease of packaging messages for delivery.

Question 50

In the eyes of critics like Senator Al Franken, the dangers of media conglomeration include all of the following EXCEPT

A) a decline in family-ownership of mass media along with a rising corporate orientation.
B) large media corporations pay lower tax rates so the government collects less revenue.
C) profitability trumps community service and cultural enrichment.
D) a shift in focus toward emphasizing improved profits.

Question 51

Media mogul Rupert Murdoch is the financial brains behind Facebook.

Question 52

Capitalism is a profit-driven system.

Question 53

The primary revenue streams for mass media industries are user fees and sales.

Question 54

Advertising generates most of the revenue for newspapers, magazines, radio and television.

Question 55

Newspapers earn less from advertisers than readers.

Question 56

Early in the 21^st century, readership losses, primarily to the Internet, eroded confidence among advertisers in using newspapers and magazines.

Question 57

Google has consistently earned more revenue than any other U.S. media conglomerate.

Question 58

The purchase of the Knight Ridder newspaper chain and the subsequent sale of some of its newspapers by McClatchy is an example of divestiture.

Question 59

Robert Murdoch built one of the planet's largest media empires, which includes Fox television networks.

Question 60

Most of the 12,000 magazines in the United States are published by organizations that produce and distribute them to select audiences.

Question 61

The Christian Science Monitor is an example of a publication that is not sponsored by an institution.

Question 62

One of the alternative financial models for media companies that was carefully examined before being totally rejected was the idea of using community foundations to operate them.

Question 63

A cooperative is an organization owned and run jointly by members that share profits or benefits.

Question 64

The Associated Press is the largest news-gathering organization that is profit motivated.

Question 65

Skeptics worry that community foundations owning newspapers might not provide detached and neutral coverage.

Question 66

The need to generate sufficient revenue to maintain infrastructure is an inhibiting factor when a non-profit considers buying a for-profit business.

Question 67

One form of journalism that is being abandoned by budget-strapped traditional media companies is investigative journalism.

Question 68

Several universities have started student-led, non-profit news organizations.

Question 69

Family ownership of newspapers is increasing.

Question 70

The death tax is another name for taxes on inheritances.

Question 71

Government has favored mass media over other businesses through such policies as low postal rates.

Question 72

The sinking of the Titanic was the impetus for the U.S. government to begin regulating the transmission of radio signals .

Question 73

Early attempts at government regulation of radio were primarily driven by concerns over public safety.

Question 74

By the time the Federal Radio Act was enacted, the government was primarily concerned with regulating the types of content that could be allowed on the airwaves.

Question 75

The 1927 Federal Radio Act was in response to the increasing number of corporate takeovers of small radio stations.

Question 76

The Federal Radio Commission was set up to license radio stations and regulate who had access to the airwaves.

Question 77

The 1970 Newspaper Preservation Act brought stricter anti-trust regulation of newspapers.

Question 78

When newspapers merge their production, distribution, advertising and business operations with competing newspapers, they do so under a joint operating agreement.

Question 79

The Newspaper Preservation Act of 1970 continues to play a key role in providing long-term, economic stability for newspapers.

Question 80

For a while at least, the Newspaper Preservation Act kept newspaper competition alive in more than two dozen cities that already had competing daily newspapers.