Deck 10: Poverty

Question 1

Powell Motors,an automobile manufacturing company,aims to manufacture a motorcycle that the poor can afford.Which of the following is a problem that will most likely pose a risk to Powell Motors in targeting the poor as consumers?

A)The company not being equipped to meet the demand of the large consumer base
B)The company cannot make profit under any circumstances.
C)The market for the poor consists of consumers who demand highly customized products.
D)The company assuming that a base of customers willing to pay for the motorcycle already exists

Answer 1

D

Question 2

LyTy,a publication company,wants to publish cost-effective school books that the poor can afford.Which of the following is a problem that will most likely pose a risk to LyTy in targeting the poor as consumers?

A)The market for the poor is so big that the company will not be able to meet the demand.
B)The poor have very little individual purchasing power.
C)The market for the poor consists of consumers who demand highly customized products.
D)The company knows that the targeted group may not be willing to pay for the product.

Answer 2

B

Question 3

Keyton Tech,an information technology company in the United States,aims to alleviate poverty in Ghana.If the company favors economist Jeffrey Sachs's belief to lift poverty-stricken countries,which of the following strategies will the company most likely adopt to achieve its aim?

A)Providing financial aid to the schools and health centers in Ghana
B)Urging the government in Ghana to promote innovation
C)Undermining the incentives built into market economies by developing a new incentive system
D)Creating products with the assumption that the base of customers for the products already exists

Answer 3

A

Question 4

Allied Technologies,a firm in the United States,has spent millions of dollars to ensure that the quality of the work of its vendors in China and India can be effectively measured and tracked.It is evident that Allied technologies has invested to avoid _____.

A)operational risks
B)structural risks
C)hostile takeovers
D)mergers and acquisitions

Question 5

Widget Corp. ,an electronics gadget manufacturing company,wants to manufacture a cell phone for the poor.Which of the following is a problem that will most likely pose a risk to Widget Corp.in targeting the poor as consumers?

A)The poor don't have any unmet needs.
B)The company cannot make profit under any circumstances.
C)The market for selling to the poor is very small.
D)The market for the poor is so big that the company will not be able to meet the demand.

Question 6

Which of the following statements is most likely to be true of poverty?

A)It is solely a cultural factor.
B)It means immunity to violence.
C)It is the inability to effectively participate in society.
D)It means having limited access to public services.

Question 7

Which of the following people is most likely to be in a poverty trap?

A)Andy,who studies in a community college
B)Jacob,who has a low level of individual capability for health and nutrition
C)Michel,who provides her family with food and shelter
D)Jessica,who is least likely to be susceptible to violence

Question 8

Unlike Arthur,Steven is in a poverty trap.Which of the following statements is most likely true for Arthur and Steven?

A)Arthur has a lower level of individual capability for health than Steven.
B)Arthur is more susceptible to violence than Steven.
C)Steven has a lower level of individual capability for education than Arthur.
D)Steven is more likely to be able to feed and clothe his family than Arthur.

Question 9

Businesses engage in alleviating poverty with the goal of:

A)increasing the poor's capabilities necessary to participate in society.
B)keeping people in a poverty trap.
C)diversifying by reducing its consumer base.
D)decreasing the base of potential employees.

Question 10

Structural risk arises as firms:

A)are not able to document the work remote employees do.
B)realize that their vendors may have different incentives than the client.
C)cannot effectively measure and track the quality of the work of its vendors.
D)cannot manage and interact with remote vendors in poor countries.

Question 11

ZeMart is a supermarket in Zaneland.The company lowers the retail price of its products with the aim of alleviating poverty.What do you think is the most likely reason that ZeMart wants to alleviate poverty?

A)The market for selling to the poor is huge.
B)The market for selling to the poor is often attractive.
C)ZeMart wants to diversify its business.
D)ZeMart wants to increase the base of potential consumers.

Question 12

According to economist Jeffrey Sachs,the key to lift poverty-stricken countries is to:

A)infuse foreign aid in those countries.
B)undermine the incentives built into market economies.
C)promote development and innovation by its governments.
D)create a reliance on domestic donors.

Question 13

Nathan lives in poverty.Which of the following statements is most likely to be true of Nathan?

A)He has a low level of individual capability for education.
B)He is not susceptible to violence.
C)He has limited access to public services.
D)He can effectively participate in society.

Question 14

Which of the following people is most likely living in poverty?

A)Martha,who is unsusceptible to violence
B)Jonathan,who does not have access to schools
C)Alan,who can only afford to attend a community college
D)Avril,who spends half of her salary on house rent

Question 15

Martha,a mother of two infants,is in a poverty trap.Which of the following statements is most likely to be true of Martha?

A)She has a high level of individual capability for education.
B)She has a low level of individual capability for hope.
C)She is not susceptible to violence.
D)She can only afford to put her kids through high school.

Question 16

MynTech,a technology firm in the United States,hired a recruiter to recruit potential employees in China.MynTech had to work closely with the recruiter to ensure that only candidates with the desired skill set are hired.It is evident that MynTech worked closely with the recruiter to avoid:

A)operational risks.
B)structural risks.
C)hostile takeovers.
D)mergers and acquisitions.

Question 17

Rick's family lives in abject poverty in Belwick.Which of the following statements is most likely to be true of the family?

A)They do not have enough resources to be clothed and fed.
B)They only have access to schools that are run by private institutes.
C)They have limited access to public services.
D)They are unsusceptible to violence.

Question 18

Compared with the rich,the poor:

A)are subject to higher turnover.
B)are subject to lower absenteeism.
C)often need more training.
D)have limited access to public services.

Question 19

Operational risk comes from a firm's:

A)inability to document the work remote employees do.
B)realization that its vendors may have different incentives than the client.
C)inability to change its business strategy to acquire another company.
D)realization that the firm cannot build a lifestyle around its product.

Question 20

Alton Publishing Co. ,an e-learning firm based in the United States,provides free education courses to the poor in Namibia.Given the above information,which of the following statements is most likely to be true?

A)Alton Publishing Co.promotes innovation in Namibia.
B)Alton Publishing Co.gives foreign aid to Namibia.
C)Alton Publishing Co.is a multilateral aid agency.
D)Alton Publishing Co.is a nonprofit organization.

Question 21

Joseph,a third year economics student,gives a speech about the ways to alleviate poverty.If Joseph's thoughts in this matter are aligned with the views of economist Dambisa Moyo,which of the following arguments will Joseph support?

A)Poverty-stricken countries can be lifted using the funds provided by developed countries.
B)Foreign aid is completely utilized to develop infrastructure for the poor.
C)Foreign aid creates a natural,healthy reliance on foreign donors.
D)Foreign aid is a waste of resources when it is used to alleviate poverty.

Question 22

In the context of the income pyramid,which of the following statements is true of the base of the pyramid?

A)It is the richest socioeconomic group in the global economy.
B)The average income of people in this group is just over $10 a day.
C)It is the largest socioeconomic group in the global economy.
D)The average income of people in this group is just over $20 a day.

Question 23

Martha attends a conference that discusses the importance of foreign aid in alleviating poverty.She listens to various speakers arguing for and against the need for foreign aid in alleviating poverty.If Martha's views are aligned with the views of economist Dambisa Moyo,whose argument will Martha support?

A)Andy,who argues that foreign aid promotes innovation in those countries that receive it
B)Cindy,who argues that foreign aid frequently goes to corrupt leaders who build personal wealth rather than the infrastructure their countries need
C)Nathan,who argues that foreign aid creates a natural,healthy reliance on foreign donors
D)Jeff,who argues that similar to a car with a dead battery,poor countries require a "jump start"-an infusion of foreign aid

Question 24

Adam,a student of business administration,participates in a debate competition about the role of foreign aid in alleviating poverty.If Adam's views are aligned with the views of economist Dambisa Moyo,which of the following arguments will Adam support?

A)Foreign aid may undermine innovation in those countries that receive it.
B)Foreign aid creates a natural,healthy reliance on foreign donors.
C)Providing free education and healthcare facilities to the poverty-stricken countries is the key to alleviate poverty.
D)Like a car with a dead battery,poor countries require a "jump start"-an infusion of foreign aid.

Question 25

NoTimber Inc. ,a scholastic stationary manufacturing company,donates $1 to a charitable fund for each stationary purchased from the company stores.In this scenario,it can be said that NoTimber Inc.is a _____.

A)nonprofit organization
B)transnational organization
C)for-profit organization
D)multilateral aid agency

Question 26

In the context of poverty-stricken countries,which of the following statements is aligned with the views of economist Dambisa Moyo?

A)Poverty-stricken countries can be lifted using the funds provided by developed countries.
B)Foreign aid is a waste of resources when it is used to alleviate poverty.
C)Poverty stricken countries cannot be helped by promoting innovation.
D)Free Health camps that are conducted by foreign countries help alleviate poverty significantly.

Question 27

In comparison with government aid agencies,multilateral aid agencies:

A)reduce conflict among nations.
B)are unable to utilize deep local knowledge of needs in a global region.
C)are less likely to pool financial resources efficiently.
D)tend to be more tied to the political self-interests of specific donor countries.

Question 28

Collectively owned aid agencies are known as _____.

A)transnational aid agencies
B)multinational agencies
C)multilateral aid agencies
D)fair trade agencies

Question 29

Stan and Practor,a chain of private hospitals in the United States,runs free health camps across the poverty-stricken country of Zaneland.Given the above information,which of the following statements is most likely to be true?

A)Stan and Practor promotes innovation in Zaneland.
B)Stan and Practor is a multilateral aid agency.
C)Stan and Practor is a nonprofit organization.
D)Stan and Practor provides foreign aid to Zaneland.

Question 30

Madison attends a conference that discusses the importance of foreign aid in alleviating poverty.She listens to various speakers arguing for and against the need for foreign aid in alleviating poverty.If Madison's views are aligned with the views of economist Dambisa Moyo,Madison will most likely support:

A)Paula,who argues that foreign aid promotes innovation in those countries that receive it.
B)Cindy,who argues that foreign aid is completely utilized to develop infrastructure for the poor.
C)Ruby,who argues that infusion of foreign aid creates an unnatural reliance on foreign donors.
D)Jessica,who argues that the more foreign aid is poured into a poverty-stricken country,the faster it can move out of the poverty trap.

Question 31

In comparison with government aid agencies,multilateral aid agencies:

A)increase conflict among nations.
B)are unable to utilize deep local knowledge of needs in a global region.
C)are less likely to pool financial resources efficiently.
D)tend to be less tied to the political self-interests of specific donor countries.

Question 32

MineralT,a beverage company,prices its bottled water in proportion to the income levels in the countries where they are sold.It is evident that MineralT has adopted the strategy of:

A)tiered pricing.
B)aggressive pricing.
C)decoy pricing.
D)keystone pricing.

Question 33

Ryan earns a daily wage of $5 a day.In the context of the income pyramid,which of the following statements is most likely to be true of Ryan?

A)He is part of the poorest socioeconomic group in the global economy.
B)He belongs to the group that is fairly urban and highly competitive.
C)He is part of the smallest socioeconomic group in the global economy.
D)He belongs to a group that has the highest market value.

Question 34

The Corporate United Front is an aid agency that is collectively owned by 100 corporate firms.The agency was established to provide aid to poverty-stricken countries.In this scenario,it can be said that The Corporate United Front is a _____.

A)transnational aid agency
B)multilateral aid agency
C)multinational agency
D)government agency

Question 35

Unlike nonprofit organizations,for-profit organizations:

A)may tie the sales of a product to actions to alleviate poverty.
B)put all profits made back into organizations to further their charitable goals.
C)are also known as foundations.
D)are also known as multilateral aid agencies.

Question 36

Stephenson's Aid is a humanitarian organization that provides emergency assistance,disaster relief,and education in Belwick.This organization is mainly funded by a wealthy industrialist,Stephenson.All profits made by the organization are put back into the organization to further its charitable goals.In this scenario,it can be said that Stephenson's Aid is a _____.

A)foundation
B)transnational organization
C)for-profit organization
D)multilateral aid agency

Question 37

In comparison with government aid agencies,multilateral aid agencies:

A)increase conflict among nations.
B)are unable to utilize deep local knowledge of needs in a global region.
C)are more likely to pool financial resources efficiently.
D)tend to be more tied to the political self-interests of specific donor countries.

Question 38

In comparison with government aid agencies,multilateral aid agencies:

A)increase conflict among nations.
B)can simultaneously develop and utilize deep local knowledge of needs in a global region.
C)are less likely to pool financial resources efficiently.
D)tend to be more tied to the political self-interests of specific donor countries.

Question 39

Which of the following statements is true of poverty science?

A)The sole purpose of poverty science is to determine causes of poverty.
B)It is a movement that relies on randomized experiments to determine effective ways to alleviate poverty.
C)The main goal of poverty science is to determine the number of people living below the poverty line.
D)It fails to compare different poverty-reduction initiatives based on facts.

Question 40

Which of the following statements is true of a corporate social responsibility (CSR)approach to doing business?

A)It does not help alleviate poverty.
B)It reduces companies' earning potential by a significant amount.
C)It can maximize long-term profitability.
D)It furthers social good but is limited to the requirement of the law.

Question 41

A _____ is an index that allows investors to track a company's carbon use.

A)fossil index
B)green index
C)warming index
D)pollution index

Question 42

Assess the argument "Poverty deprives individuals of key capabilities,limiting their ability to achieve and earn,thus keeping them poor and limiting their opportunities to increase their capability."

Question 43

In the context of emerging markets,unlike normal innovation,reverse innovation:

A)starts as companies try to adapt their established products and services by removing more expensive features.
B)creates a new market and value network and eventually disrupts an existing market and value network.
C)creates new products from the ground up to meet the specific needs of the poor.
D)is not a source of sustainable competitive advantage for companies.

Question 44

What is a benefit corporation (B-Corp)?

Question 45

Unlike normal corporations,benefit corporations:

A)are illegal entities.
B)are for-profit organizations.
C)focus on the needs of their shareholders rather than the society.
D)are required to report both their profits and their social goals.

Question 46

Which of the following is true of benefit corporations in the United States?

A)They are nonprofit organizations.
B)They have an additional focus beyond making money.
C)They are illegal entities.
D)They focus on the needs of their shareholders rather than the society.

Question 47

In the process of designing a business model to sell profitably to the poor,Zencorp,an electronic gadget manufacturer,aims to launch affordable cell phones for the poor.The company,for the time being,plans to have a narrow focus on profitably selling to the poor instead of serving other social goals.It is evident that Zencorp aims to avoid _____ related to base-of-the pyramid markets.

A)the unmet needs trap
B)to cost of capital trap
C)multiple objective trap
D)adaptability trap

Question 48

Classify the world population based on the income pyramid.

Question 49

_____ is the process of taking innovations developed in emerging markets and repackaging them for developed markets.

A)Reverse innovation
B)Disruptive innovation
C)Distributive innovation
D)Ad hoc innovation

Question 50

Do you agree that foreign aid is essential to alleviate poverty?

Question 51

Allied Starts is a funding platform for creative projects.Legally defined goals of the company include promoting activities that have positive outcome on society and environment while garnering profit.It is evident that Allied Starts is a _____.

A)benefit corporation
B)foundation
C)limited liability company
D)C corporation

Question 52

In the process of designing a business model to sell profitably to the poor,FoodLoaf,a food processing company,aims to launch low-priced meals.The product is designed as per the purchasing power of the poor.It is evident that FoodLoaf aims to avoid _____ related to base-of-the pyramid markets.

A)the unmet needs trap
B)cost of capital trap
C)affordability trap
D)adaptability trap

Question 53

In the context of the income pyramid,identify a true statement regarding the base of the pyramid.

A)It is the richest socioeconomic group in the global economy.
B)It is the smallest socioeconomic group in the global economy.
C)It constitutes a $12.5 trillion market.
D)It is fairly rural and has an informal economy.

Question 54

In the process of designing a business model to sell profitably to the poor,V Motors,an automobile manufacturer,aims to launch cheaper versions of its motorcycles.The company pays very little attention to the cost-quality trade-off that may not be acceptable to the poor.It is evident that V Motors may fall in _____ related to base-of-the pyramid markets.

A)the unmet needs trap
B)to cost of capital trap
C)affordability trap
D)adaptability trap

Question 55

In the context of the income pyramid,which of the following people is part of the base of the pyramid?

A)Max,who makes $15 a day
B)Jason,who lives on about $8 a day
C)Jessica,who makes just over $10 a day
D)Andrew,who lives on just more than $20 a day

Question 56

Assess the argument "A corporate social responsibility (CSR)approach to doing business inhibits a firm from becoming profitable."

Question 57

In the process of designing a business model to sell profitably to the poor,Widget Corp. ,an information technology firm,conducts a survey to determine the number of people willing to pay for the company's product instead of determining the number of people who require the product.It is evident that Widget Corp.aims to avoid _____ related to base-of-the pyramid markets.

A)the unmet needs trap
B)cost of capital trap
C)affordability trap
D)adaptability trap

Question 58

Justify the statement "The poor can be profitable clients."

Question 59

_____ is a source of financial services for entrepreneurs and small businesses lacking access to banking and entrepreneurial training.

A)Microfinance
B)Microdebit
C)Macrofinance
D)Macrocredit

Question 60

Nathan,a daily-wage worker who earns about $10 a day,is able to feed and clothe his family but unable to put his children through college.Do you think that Nathan is living in poverty?