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Section 4: Sample Selected-Response Questions
Business and Finance 6–12 (276)

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This section presents some sample exam questions for you to review as part of your preparation for the exam. To demonstrate how each competency may be assessed, sample questions are accompanied by the competency that they measure. While studying, you may wish to read the competency before and after you consider each sample question. Please note that the competency statements do not appear on the actual exam.

For each sample exam question, there is a correct answer and a rationale for each answer option. The sample questions are included to illustrate the formats and types of questions you will see on the exam; however, your performance on the sample questions should not be viewed as a predictor of your performance on the actual exam.

Domain I—Finance

Competency 001—The teacher understands and applies knowledge of money matters.

1. When a company is trying to regulate its spending and track incoming funds, the accountant should prepare an income statement once

  1. every month.
  2. every two months.
  3. every six months.
  4. every year.
Enter to expand or collapse answer.Answer expanded
Option A is correct because income statements are usually produced once a month to ensure expense review and control. This will allow a company to determine how much money is coming in and how it’s being spent. Options B and C are incorrect because in order to track incoming money and regulate spending, an income statement needs to be prepared more frequently. Option D is incorrect because annual income statements are usually prepared to be reviewed, audited and used to determine tax obligations for the year.

2. Which of the following best identifies the use of debt financing to raise capital?

  1. Convertible securities
  2. Direct stock offerings
  3. Promissory notes
  4. Initial public offerings
Enter to expand or collapse answer.Answer expanded
Option C is correct because a promissory note would indicate a loan and debt financing to raise capital. Option A is incorrect because convertible securities (a type of security, usually a stock or bond, that can be converted to another type of security, usually another type of stock or bond) are used to raise capital by way of equity financing. Option B is incorrect because direct stock offerings are used to raise capital by equity financing. Option D is incorrect because an initial public offering raises capital through equity financing.

Competency 002—The teacher understands and applies knowledge of banking and financial services.

3. Which of the following occurs after a customer withdraws money from an automated teller machine?

  1. The customer’s access privileges are checked.
  2. The debit is posted to the account.
  3. The connection to the server is established.
  4. The system verifies that the customer has an account.
Enter to expand or collapse answer.Answer expanded
Option B is correct because after the customer has withdrawn money from the account via the ATM, the amount is deducted from the customer’s account balance. Option A is incorrect because checking the customer’s access privileges occurs after the server connection has been established and the verification that the customer holds an account has occurred. Option C is incorrect because establishing the server connection is the first step that must occur for the process to begin. Option D is incorrect because verification that the customer holds an account must occur before a withdrawal can occur.

Competency 003—The teacher understands and applies knowledge of securities and investments.

4. A lending company will review a borrower’s accounting documentation to evaluate

  1. creditworthiness.
  2. current assets to past liabilities.
  3. the expenses in terms of employee risk management.
  4. the aggregate statistics relating to the likelihood that a competitor will enter the market.
Enter to expand or collapse answer.Answer expanded
Option A is correct because credit-worthiness is the key determinant of how likely it is that the loan will be repaid. Option B is incorrect because the lending company will be examining current cash flow, not past liabilities. Option C is incorrect because the expenses associated with employee risk management are unrelated to any of the characteristics that a lending company will be reviewing. Option D is incorrect because the entrance of a competitor to the market is unrelated to the characteristics that a lending company will be reviewing.

Competency 004—The teacher understands and applies knowledge of insurance operation.

5. Which of the following doctrines prevents a person from insuring a neighbor's house?

  1. Doctrine of contribution
  2. Doctrine of subrogation
  3. Doctrine of indemnification
  4. Doctrine of insurable interest
Enter to expand or collapse answer.Answer expanded
Option D is correct because doctrine of insurable interest means that a person will suffer financial or other kinds of loss when they lose or damage a particular property. Option A is incorrect because the doctrine of contribution means that a defendant who has paid more than his or her share of the award has a claim against other jointly liable parties for the excess payment. Option B is incorrect because the doctrine of subrogation refers to the ability of one person to take the place of another in regard to a lawful claim, demand or right against a third party. Option C is incorrect because doctrine of indemnification refers to the ability to financially restore a property as it was prior to the incident.

Competency 005—The teacher understands and applies knowledge of basic accounting.

6. Which of the following inventory systems is designed to record the actual costs associated with the inventory using a physical count?

  1. The periodic inventory system
  2. The perpetual inventory system
  3. The temporary inventory system
  4. The just-in-time inventory system
Enter to expand or collapse answer.Answer expanded
Option B is correct because the perpetual inventory system is designed to record the actual costs affiliated with inventory using a physical count. Option A is incorrect because in a periodic inventory system, the inventory does not become part of the count of goods to be sold. Option C is incorrect because a temporary inventory system does not account for inventory errors. Option D is incorrect because in a just-in-time inventory system, inventory goods are not on hand until needed.

Competency 006—The teacher understands and applies knowledge of advanced accounting.

7. Which of the following valuations is used to calculate the straight-line depreciation of an asset?

  1. Market value
  2. Salvage value
  3. Enterprise value
  4. Replacement value
Enter to expand or collapse answer.Answer expanded
Option B is correct because salvage value is used as a component of the depreciation calculation. Option A is incorrect because market value bases its price on supply and demand of the item and is not used in straight-line depreciation. Option C is incorrect because enterprise value refers to the economic value of a company and is not used in straight-line depreciation. Option D is incorrect because replacement value equals the cost to replace an asset at market prices and is not used in straight-line depreciation.

8. In which of the following sections of the balance sheet is prepaid insurance recorded?

  1. Expenses
  2. Assets
  3. Liabilities
  4. Equity
Enter to expand or collapse answer.Answer expanded
Option B is correct because prepaid insurance is paid in advance and holds value. A refund could be requested for the unused portion. Option A is incorrect because prepaid insurance is expensed only as it is used. Option C is incorrect because a liability is an obligation that is due and is unrelated to the sale of a product or service. Option D is incorrect because equity refers to ownership in stock or other securities.

Competency 008—The teacher uses probability calculations to anticipate and forecast expected outcomes and manage risk.

9. Which of the following statements is generally true about the purchasing function today?

  1. A wide supplier base is desired because purchasing prices are lowered.
  2. The focus of purchasing today has changed from a relational to a transactional one.
  3. Purchasing is evolving into strategic supply management.
  4. Relationships with suppliers typically lead to supplier opportunism.
Enter to expand or collapse answer.Answer expanded
Option C is correct because the traditional purchasing department has evolved into a position of greater importance and esteem within a company, becoming known as “supply management.” Option A is incorrect because this is no longer true; if suppliers are constantly forced to reduce prices, quality of goods and services can decrease. When the company offers inferior products and services, loss of standing among consumers and in the market can occur. Damage control is expensive and may not work. Option B is incorrect because the opposite has occurred: purchasing has changed to relational because it has been discovered that relationships with suppliers can lead to cooperation so that mutual benefit occurs. Option D is incorrect because the opposite is true. Relationships grow cooperation among both parties so that supplier opportunism does not occur.

Domain II—Business Management

Competency 009—The teacher understands types of business ownership and entrepreneurial skills and procedures.

10. The owner of a small boat rental company opened the business as a sole proprietorship but has since decided to bring a friend into the business. It is best for the owner, who is concerned about the cost of changing the form of the company’s organization, to change the business structure to a

  1. corporation.
  2. partnership.
  3. joint venture.
  4. cooperative.
Enter to expand or collapse answer.Answer expanded
Option B is correct because the cost to form a partnership is less expensive than the cost to form a corporation, joint venture, or cooperative. Option A is incorrect because forming a corporation is expensive and requires extensive documentation. Option C is incorrect because a joint venture involves two or more businesses pooling their resources and expertise to achieve a particular goal. Option D is incorrect because a cooperative is a group whose members agree on a common need and a strategy for how to meet that need.

11. Kim, a young college student, has decided to start a business. She does not have much capital but believes the business can generate capital through an initial public offering (IPO). An IPO is categorized as

  1. debt.
  2. an asset.
  3. equity.
  4. income.
Enter to expand or collapse answer.Answer expanded
Option C is correct because IPO stock is considered equity for the buyer. Option A is incorrect because debt comes from taking loans and selling bonds. Option B is incorrect because an asset is a resource that is owned and has value. Option D is incorrect because income is derived from the sale of a good or service.

12. The marketing department of a small business wants to obtain information about how and why a product continues to be successful after many years. Which of the following research techniques will be most effective?

  1. Obtaining expert reviews
  2. Organizing focus groups
  3. Conducting one-on-one interviews
  4. Requesting user surveys
Enter to expand or collapse answer.Answer expanded
Option D is correct because user surveys are a relatively quick and inexpensive way of gathering and quantifying public opinion and monitoring change over time, which is most appropriate for answering the desired question. Option A is incorrect because expert reviews do not provide the same quality of insight as real end-user testing does. Option B is incorrect because focus groups can be time-consuming and expensive, and they may provide findings that are not statistically significant. Option C is incorrect because one-on-one interviews can be time-consuming and expensive, and they may provide findings that are not statistically significant.

Competency 010—The teacher understands the principles of management in a business environment.

13. Which of the following best describes management practices that promote adaptability in a global business environment?

  1. Changing strategies to accommodate local conditions
  2. Developing a set of fixed responses to anticipated problems
  3. Establishing procedures to be used systematically in all regions
  4. Launching sales initiatives to conform to the corporate calendar
Enter to expand or collapse answer.Answer expanded
Option A is correct because changing strategies to accommodate local conditions indicates management’s willingness to adapt to local environments. Option B is incorrect because developing a set of fixed responses does not allow the flexibility to adapt differently if the situation deviates from what has been anticipated. Option C is incorrect because establishing procedures to be used systematically implies that the procedures are the same regardless of local conditions and do not acknowledge the need to adapt. Option D is incorrect because launching sales initiatives that conform to a corporate calendar means that the sales initiatives are developed independently of what might be most appropriate for a given region, and it does not make it possible to adapt to local calendars or needs.

Competency 011—The teacher understands human relations and resource management.

14. Which of the following types of compensation has the greatest positive effect on employee motivation and productivity?

  1. High pay level at beginning salary
  2. Varied and attainable pay mix
  3. Regularly scheduled pay raises
  4. Uniform employee pay increases
Enter to expand or collapse answer.Answer expanded
Option B is correct because making a varied pay mix available to workers has been shown to improve employee motivation and therefore productivity. Pay mix includes merit pay plans and incentives for groups, departments, and individuals. Option A is incorrect because a high pay level at a beginning salary has been shown to be beneficial to hiring but not to improving employee motivation and productivity. Option C is incorrect because, although welcomed by employees, regularly scheduled pay raises have not been shown to improve employee morale and productivity. Option D is incorrect because receiving the same pay increase tends to cause dissatisfaction among employees because all are being rewarded equally, regardless of performance. It therefore has a negative effect on employee motivation and productivity.

15. To have the greatest impact on long-term employee productivity, businesses must

  1. conduct effective employee evaluations.
  2. increase production quotas.
  3. implement a pushing management style.
  4. raise performance expectations.
Enter to expand or collapse answer.Answer expanded
Option A is correct because an effective employee evaluation will allow the employee to adjust and improve his or her performance, thus improving productivity. Option B is incorrect because, while production quotas may produce short-term improvements in productivity, they have been less successful over the long term. Option C is incorrect because a push management style means that employees have a limited understanding of their role; they are not being challenged to develop and do not know if they are adding value to the company. This limited understanding of problems and their solutions can be frustrating and make an employee less productive. Option D is incorrect because having expectations that exceed an employee’s job description or background knowledge can make the employee feel unprepared and diminish that employee’s performance.

Domain III—Ethics, Law, Business Communication and International Business

Competency 012—The teacher understands issues related to ethics and social responsibility in business and personal behavior.

16. Which of the following situations is legal but not ethical?

  1. A business goes beyond the letter of the law to preserve the environment for future generations.
  2. A top company executive uses questionable accounting practices to manipulate the company’s stock price for financial gain.
  3. A company imports and sells goods from a company that uses child labor in unsafe conditions in its manufacturing plants.
  4. A group of pharmacists agree to charge the same prices because of the rising costs of prescription medicines.
Enter to expand or collapse answer.Answer expanded
Option C is correct because it is legal to import goods from other countries, but clearly unethical to buy and sell goods produced by child labor in unsafe conditions. Option A is incorrect because going beyond the law to preserve the environment is both legal and ethical. Option B is incorrect because the scenario is illegal and unethical. Option D is incorrect because the situation is illegal, but ethical.

17. RXJW is a publicly traded company that is required by law to register its code of ethics with the Securities and Exchange Commission and ensure that its senior financial officers are aware of the policy. Which of the following mandates this requirement?

  1. Single Audit Act
  2. Sarbanes-Oxley Act
  3. Code of Federal Regulations
  4. National Labor Relations Act
Enter to expand or collapse answer.Answer expanded
Option B is correct because section 406 of the Sarbanes-Oxley Act requires filing a code of ethics with the SEC and ensuring that financial officers are aware of the policy. Option A is incorrect because the Single Audit Act provides provisions for entities that receive federal funds. Option C is incorrect because the Code of Federal Regulations is divided into 50 titles that represent broad areas that are subject to federal regulation. Option D is incorrect because the National Labor Relations Act protects the rights of employees and employers.

Competency 013—The teacher understands principles of business law.

18. Which of the following federal organizations regulates overall workplace safety?

  1. Occupational Safety and Health Administration
  2. Equal Employment Opportunity Commission
  3. United States Department of Agriculture
  4. Environmental Protection Agency
Enter to expand or collapse answer.Answer expanded
Option A is correct because the Occupational Safety and Health Administration is the federal agency that regulates workplace safety. Option B is incorrect because the Equal Employment Opportunity Commission enforces federal employment discrimination laws. Option C is incorrect because the United States Department of Agriculture regulates policies on farming, agriculture, forestry, and food. Option D is incorrect because the Environmental Protection Agency protects human health and the environment.

19. Which of the following best describes the responsibilities of the Equal Employment Opportunity Commission?

  1. Enforces federal law against discrimination
  2. Enforces state laws regarding sex, gender, and religion in the workplace
  3. Ensures the number of men is equal to the number of women in the workplace
  4. Legislates on behalf of pregnant women for unchanged pay rate during maternity leave
Enter to expand or collapse answer.Answer expanded
Option A is correct because the EEOC enforces federal laws against discrimination. Option B is incorrect because the EEOC is a federal agency and regulates discrimination against more than sex, gender and religion. Option C is incorrect because the EEOC does not regulate the actual number of employees based on gender. They do, however, regulate against gender discrimination. Option D is incorrect since the EEOC ensures equal pay, but does not require employers to pay absent employees a specific rate.

20. Which of the following advertising claims is most likely to prompt an inquiry by the Federal Trade Commission?

  1. Using our cream guarantees no more wrinkles.
  2. Our apple juice gives you more.
  3. Eat our burgers; they are the best in the world.
  4. Our diamonds are the finest.
Enter to expand or collapse answer.Answer expanded
Option A is correct because the company is making a claim that its cream can guarantee no more wrinkles. The Federal Trade Commission’s (FTC) duties include investigating unsubstantiated claims; especially when they concern health, safety, or performance. An unsubstantiated claim about a product affecting the health of the consumer would probably prompt the FTC to act. Option B is incorrect because this is an example of an unfinished claim. Option C is incorrect because this is an example of hyperbole. Option D is incorrect because this is an example of hyperbole.

21. In which of the following situations has a tort occurred?

  1. A firework spark lands on a neighbor’s tree and burns it down.
  2. A one-year lease is terminated by the renter before it ends.
  3. A pet dog runs into the street and is struck by a vehicle.
  4. A credit card is stolen and used to make several purchases.
Enter to expand or collapse answer.Answer expanded
Option A is correct because the person shooting fireworks was careless and caused harm to a neighbor’s property. Option B is incorrect because a lease is a contract, and contracts are not part of tort law. Option C is incorrect because the dog was in the street and was injured because it was not controlled by the owner, such as being restrained by a leash or contained in a house or closed yard. The dog’s injuries are not the result of the negligence of the driver but the negligence of the owner of the dog. Option D is incorrect because this is a criminal action not a tort, which is classified as civil law.

Competency 014—The teacher understands basics of international business.

22. Which of the following policies will most likely increase foreign trade?

  1. Implementing ad valorem tariffs
  2. Establishing free-trade zones
  3. Employing packaging regulations
  4. Applying specific tariffs
Enter to expand or collapse answer.Answer expanded
Option B is correct because free-trade zones encourage trade by establishing areas where goods are treated as if they are from the country to which they are being imported, thereby reducing duty and tax costs and streamlining production and processes. Option A is incorrect because ad valorem tariffs increase the price of imported goods, making them less competitive with domestic goods. Option C is incorrect because packaging regulations, especially those that differ from those of the exporting countries, require additional processing and raise the price of the goods, thereby decreasing their competitiveness with domestic goods. Option D is incorrect because adding a fixed fee to a particular imported good increases its price and reduces its competitiveness with domestic goods.

23. Which of the following statements regarding the taxation and international business operations of a company in its residence and source states is true?

  1. The company pays taxes to the state with the lowest tax rate.
  2. The residence state mitigates the tax.
  3. The source state mitigates the tax.
  4. The company pays taxes only to the residence state.
Enter to expand or collapse answer.Answer expanded
Option B is correct because allowing the residence state to mitigate the tax is a long-standing international tax agreement that prevents a company from being subject to double taxation when doing business in two countries. Option A is incorrect because the company must pay the source-state taxes regardless of the rate. Option C is incorrect because the company’s source state is the one to which the taxes are paid; the residence state mitigates the tax. Option D is incorrect because the company pays taxes to the source state.

Competency 015—The teacher understands basic elements of communication and applies skills for effective communication in business contexts.

24. An effective form of communication is the use of graphs and charts to convey information. A pie chart is an effective way of

  1. identifying the parts of a subject and their spatial or functional relationship.
  2. offering a visual representation of large changes over a space.
  3. communicating varying values or percentages in relation to each other that is not related to time.
  4. comparing the qualities to two variables to clearly show the changes over time.
Enter to expand or collapse answer.Answer expanded
Option C is correct because a pie chart is a graphic representation of quantitative information by means of a circle divided into sectors, in which the relative sizes of the sectors correspond to the relative sizes or proportions of the quantities of the whole. Option A is incorrect because this is the definition of a diagram. Option B is incorrect because this is the definition of a bar graph. Option D is incorrect because this is the definition of a line graph.

25. Which of the following notations is most appropriate for citing a specific page within a specific section of a book with one author?

  1. Anthony Sorbo, Handbook of Trust Law (1987).
  2. Brown’s Law Dictionary 602 (10th ed. 2008).
  3. Children and the Law 24 (Connie L. Hercot ed., 1992).
  4. Eric James, Civil Procedure § 2.3, at 124 (8th ed. 2012).
Enter to expand or collapse answer.Answer expanded
Option D is correct because this citation includes references to a specific page within a specific section as well as the name of the author. Option A is incorrect because this citation does not include a reference to a specific page within a specific section. Option B is incorrect because this citation does not include the name of an author or a specific page within a specific section. Option C is incorrect because this citation refers to an editor but not an author and to a page but not a section.

Domain IV—Technology and Information Systems

Competency 016—The teacher understands, applies fundamentals of, and effectively uses computer systems.

26. Which of the following proofreaders’ marks means to “delete”?

  1. my Dad's watch
  2. friends both were
  3. car mufflers should should
  4. some body
Enter to expand or collapse answer.Answer expanded
Option C is correct because the symbol means to delete. Option A is incorrect because this is an example of the symbol to indicate that lowercase should be used. Option B is incorrect because this is an example of the symbol for transpose or switch around. Option D is incorrect because this is an example of the symbol that means to close up the space.

27. Which of the following types of illustrations best represents continuous processes?

  1. Line graph
  2. Table or figure
  3. Schematic
  4. Flow chart
Enter to expand or collapse answer.Answer expanded
Option A is correct because line graphs represent continuous processes. Option B is incorrect because tables are lists of data presented in rows and columns. Figures are any other visual depiction. Option C is incorrect because schematics are usually used for illustrating more abstract ideas. Option D is incorrect because flow charts illustrate stages in a process or a step-by-step view of a process.

28. Which of the following is the best function on a presentation software toolbar for importing graphics into a presentation?

  1. Edit
  2. Insert
  3. Design
  4. Animations
Enter to expand or collapse answer.Answer expanded
Option B is correct because the insert tool makes it possible to import a graphic, text, audio, and video. Option A is incorrect because the edit tool makes it possible to make changes to the presentation. Option C is incorrect because the design tool makes it possible to choose a template. Option D is incorrect because the animation tool makes it possible to arrange the text, graphics, audio and video in the presentation.

Competency 017—The teacher understands terminology and principles related to information technology.

29. Which of the following approaches is best to use when creating a business presentation?

  1. Including the goal at the end of the presentation
  2. Closing the presentation with a question-and-answer period
  3. Using supporting material sparingly in the presentation
  4. Establishing the presenter's credibility at the beginning of the presentation
Enter to expand or collapse answer.Answer expanded
Option D is correct because establishing credentials and authority at the beginning of the presentation will make the audience be more accepting and open to what the presenter has to say. Option A is incorrect because the goal of the presentation should be stated up front so the audience understands what to expect. Option B is incorrect because, although the question and answer period should follow the presentation, the presentation should end with a brief closing to summarize the main points. Option C is incorrect because the opposite is actually true. Using supporting material throughout the presentation adds to both your credibility and underscores the reliability of the information being presented.

Competency 018—The teacher understands principles and procedures related to information management systems and information technology applications.

30. Which of the following is most important to consider when developing a technology plan for schools in a school district?

  1. The average school has more Internet connectivity than the average home.
  2. Most schools have the network capacity to meet all teaching needs.
  3. Teachers in general need more training to integrate technology in their lessons.
  4. The future of learning is less individualized because of digital technologies.
Enter to expand or collapse answer.Answer expanded
Option C is correct because most teachers are not receiving the training needed to meet the needs of digital learning. Option A is incorrect because the average school and home actually have the same amount of Internet connectivity, although the school Internet has many more users. Option B is incorrect because less than 20 percent of teachers have the network capacity in the classroom needed for lessons. Option D is incorrect because the opposite is true: digital technologies facilitate more individualized instruction.

31. An individual uploads items to sell on an international Web site and occasionally purchases items from the same source. This practice is best known as

  1. e-commerce.
  2. market economy.
  3. foreign exchange.
  4. electronic signature.
Enter to expand or collapse answer.Answer expanded
Option A is correct because international business refers to all business activities that involve cross-border transactions of services, goods and resources between two or more nations, including commercial transactions conducted electronically over the Internet, which is considered E-Commerce (Electronic Commerce). Option B is incorrect because a market economy reflects decisions about resource allocations based on supply and demand. Option C is incorrect because foreign exchange involves trading currencies. Option D is incorrect because the U.S. Federal ESIGN Act defines an electronic signature as an “electronic sound, symbol or process, attached to or logically associated with a contract or other record and executed or adopted by a person with the intent to sign the record.”

Competency 019—The teacher understands principles and procedures related to confidentiality, security and data integrity associated with computer technology.

32. Which of the following best describes a digital footprint?

  1. A technological interaction that can be traced to an individual
  2. An image embedded in a word processing document
  3. An erasable online interaction
  4. An online digital identity
Enter to expand or collapse answer.Answer expanded
Option A is correct because a digital footprint is a trail or history left behind by a user’s interactions with technology. Option B is incorrect because a digital footprint is not an image embedded in a word processing document. Option C is incorrect because a digital footprint is not erasable. Option D is incorrect because a digital footprint is not a digital identity but data collected about actions and communications online.

33. A teacher is instructing students on the importance of firewalls. To best explain the security provided by firewalls, the teacher should explain that firewalls

  1. check all incoming data for viruses.
  2. provide complete confidentiality.
  3. replace host security procedures.
  4. restrict how data exits the system.
Enter to expand or collapse answer.Answer expanded
Option D is correct because restricting how data exits the system is a characteristic of firewalls and demonstrates that a firewall is a viable component of network security. Option A is incorrect because firewalls cannot perform this function because there are too many file formats, and often files are sent in compressed form. Option B is incorrect because this is possible only if two firewalls are from the same manufacturer. Therefore, firewalls have limited confidentiality. Option C is incorrect because the opposite is true: a firewall is no replacement for good host security practices and procedures. A firewall provides some security, but it cannot provide complete security for a system. The best plan for security is to implement host security practices and procedures and install a firewall.

34. Which of the following is an advantage of parallel data mining over distributed data mining?

  1. Parallel data mining relies on data partitioning and global blending.
  2. Communication occurs among multiple process units in parallel data mining.
  3. In parallel data mining, knowledge differs between data sets and the global unit.
  4. In parallel data mining, an algorithm is applied to the entire data set.
Enter to expand or collapse answer.Answer expanded
Option D is correct because one algorithm can be applied to a data set so that the information returned is uniform and more reliable. Option A is incorrect. This is true of distributed data mining and is a disadvantage, because after the data is gathered from each dataset, it has to be analyzed, combined and stored elsewhere. Option B is incorrect. This is true of distributed data mining and is a disadvantage because the search using the algorithm has to be applied to the different datasets, analyzed and combined to form an answer. Option C is incorrect. This is true of distributed data mining and is a disadvantage. The knowledge must be examined to find a uniform pattern in order to give a solution.

Domain V—Leadership and Career Development

Competency 020—The teacher understands work-based learning, career development, and leadership opportunities.

35. For businesses, identity-based encryption (IBE) is preferable to other forms of encryption because it

  1. generates a public key automatically upon demand.
  2. requires servers to store and locate the encryption keys.
  3. ensures message security by using digital certificates.
  4. has superior key-management and key-recovery infrastructure.
Enter to expand or collapse answer.Answer expanded
Option A is correct because IBE uses an algorithm to calculate and generate the public key automatically on an as needed basis which is much faster and more secure than other methods. Option B is incorrect because IBE does not require public-key servers; there is no storage needed for the public key because it is calculated on demand using a cryptographic algorithm. This is actually a disadvantage of other forms of encryption. Option C is incorrect because digital certificates are not needed as public keys are calculated only on demand and are not stored on servers. Digital certificates are used by other forms of encryption. Option D is incorrect because IBE requires no key management or key infrastructure as do other forms of encryption. The public key is calculated on demand using a cryptographic algorithm.

36. Which THREE of the following personal attributes are most likely to have a positive effect on a person's career advancement and success?

  1. Confidence
  2. Energy
  3. Inquisitiveness
  4. Obedience
  5. Traditionalism
Enter to expand or collapse answer.Answer expanded
Option A is correct because confidence is rated as one of the top three traits sought by employers. Option B is correct because energy and confidence are two traits that reflect on an individual’s professionalism. Option C is correct because an inquisitive employee is more likely to anticipate and adjust to future changes. Option D is incorrect because obedience may signify lack of independence and personal reflection, both of which are desirable character traits. Option E is incorrect because traditionalism suggests resistance to change and innovation, traits that are desirable for employment.

37. A teacher is designing a unit that will engage students in an extended project and connect learning and work. It is most appropriate for the teacher to incorporate which of the following experiences into the unit?

  1. A job-training internship
  2. A job-shadowing opportunity
  3. A work-study job
  4. A field-based investigation
Enter to expand or collapse answer.Answer expanded
Option D is correct because field-based investigations transform classroom studies by engaging students in fieldwork and contact with adults who have expertise in the area of study. Option A is incorrect because an internship provides on-the- job experience for only a short time. Option B is incorrect because job-shadowing involves following a person throughout a workday to see what the job involves. Option C is incorrect because work-study is a program that provides employment to college students to help defray expenses.

Competency 022—The teacher understands the leadership and community service opportunities available through student organization activities and the importance of promoting a business education program.

38. Which TWO of the following benefits are employers required by law to provide?

  1. Retirement plans or pensions
  2. Workers’ compensation
  3. Medical leave for childbirth
  4. Medical insurance plans
  5. COBRA coverage
Enter to expand or collapse answer.Answer expanded
Option B is correct because federal law requires businesses to provide workers’ compensation. Option C is correct because federal law requires businesses to provide medical leave for childbirth. Option A is incorrect because a retirement plan is an optional benefit that employers may offer as a hiring incentive. Option D is incorrect because a medical insurance plan is an optional benefit that employers may offer as a hiring incentive. Option E is incorrect because COBRA is an optional benefit that employers may offer to former employees.

39. Which of the following is an objective of the National Business Education Association?

  1. To manage the teacher evaluation process
  2. To promote students with terminal degrees
  3. To promote legislation on behalf of its members
  4. To promote professional development in all United States Department of Labor clusters
Enter to expand or collapse answer.Answer expanded
Option C is correct because legislative advocacy is one of the National Business Education Association’s (NBEA) endeavors. Option A is incorrect because NBEA does not manage teacher evaluation processes. Option B is incorrect because NBEA encourages students in undergraduate programs in business to join. Option D is incorrect because NBEA focuses on business education, not all United States Department of Labor clusters.

40. The Occupational Safety and Health Administration is primarily responsible for which FOUR of the following?

  1. Controlling workplace noise exposure
  2. Regulating work walking surfaces
  3. Establishing requirements for electrical standards
  4. Driving commercial diving requirements
  5. Supervising distribution of dietary supplements
  6. Monitoring the development of X-ray equipment
Enter to expand or collapse answer.Answer expanded
Option A is correct because noise in the workplace can affect a person’s health. Option B is correct because the condition of workplace walking surfaces can cause employee accidents. Option C is correct because electrical requirements and standards in the workplace affect the worker’s environment and prevent accidental electrocutions. Option D is correct because commercial diving requirements are regulated by OSHA to protect employees who repair equipment underwater or dive for commercial seafood. Option E is incorrect because the distribution of dietary supplements is regulated by the FDA not OSHA. Option F is incorrect because the FDA regulates development of equipment that emits radiation.

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