MGT100 MIDTERM REVIEW EXAM
QUESTIONS AND ANSWERS GRADED A+
2025/2026
Why study business/ management? - ANS Many of you will ultimately work for businesses in
management functions; some will work for businesses which you own.
-Others will analyze businesses - financial/ investment analysis, business journalism
- others will manage - people, information, processes... but outside for-profit business -
government, not-for-profit organizations
What businesses have been affected the most by COVID-19? - ANS - Hospitality, tourism;
travel cancellation leads to closure in hotels, bars and restaurants.
- Secondary: transportation, and food service, insurance, retail store,
Have any businesses benefitted from COVID-19? - ANS - e-commerce
- health care services
- Face mask factories
- delivery service
- Game makers
How has COVID-19 impacted the hospitality industry - ANS - Increased sanitation
- Management of people
1 @COPYRIGHT 2026 ALLRIGHTS RESERVED.
,- Change in corporate strategy
- Supply change
Describe the ripple effect - ANS
What do CEOs need to consider when pausing/resuming operations - ANS
Wealth Creation- component - ANS Combination of inputs
Supportive Environment
Means of production
Someone who will pay more than costs
What is required to create wealth? - ANS - The interdependence of business and society
- The diamond: number of diff
The diamond - ANS An effective political system enables economic growth, a developing
society must create a financial system capable of transferring funds where they are in surplus to
projects where funds are needed.As enabling governments and financial systems grow strong,
they enhance the prospects for entrepreneurial activity.Finally, as new enterprises grow, they
rely on more sophisticated methods of coordination and control (sophisticated management).
How is wealth created? - ANS - Develop a product or service that you can sell for more than it
cost
- Trade with economies that will pay for what you have and sell you what you want
Forms of Private Business Ownership - ANS - Sole proprietorships: own by one individual,
keep all profit but sustain all the lost by yourself.
cons: can take all your asset.
- Partnerships: similar to sole but own by multiple owners.
2 @COPYRIGHT 2026 ALLRIGHTS RESERVED.
,- Corporations: separate legal entities, they operate everything can sue and be sued.
Pros: financial liability (Can only take asset of the corporation not personal), risk distributed.
Cons: double taxation (corporate itself have to pay the taxes for the profit, and the owners have
to pay taxes for the profit as well), dilution of ownership (Don't get all the money for yourself),
lower control.
- Not-for-Profit Corporations: do not pursue profit
Franchising - ANS Contract-based business arrangement between a manufacturer or other
supplier, and a dealer, to produce and market the supplier's good or service.
- Franchisor and franchisee agreement
- 76,000 Franchise in Canada, employee a million of Canadians
- make more than 100 billion
- Franchising overseas is growing
Franchising pros - ANS Prior performance record
recognizable company name (brand)
proven business model
tested management program
savings through volume purchases
Franchising cons - ANS Franchise fees
future payments (royalties)
linked to reputation and management
franchise agreement restriction
tight control: limited creativity, there's a set of guidelines that you must follow.
Frinchisor loses control of franchisee when expanding overseas.
3 @COPYRIGHT 2026 ALLRIGHTS RESERVED.
, Corporate management - ANS Shareholders: acquires shares in exchange of ownership:
- Preferred shares: get dividends before common shareholders. Have cumulative dividend:
dividends accumulate over time.
- Common Shares: get the rest of the dividend, they can vote. Have a residual ownership, and
have additional money.
Board of directors: elected by shareholders to oversee corporation
Directors: make major corporate decisions and handle ongoing operations
Finding Financing - ANS Seed Capital: initial funding for new vendor.
Debt Financing: they don't control of your business, it is a loan
- Credit Cards
- Family and friends
- Bank loans
- Finance companies
- Pros: Higher chance that they would get their money back (investor pov)
Equity Financing: money that is invested that you don't have to pay back but share your profit
between your dividends and otherwise.
- Venture Capitalist
- Angel Investors
- Pros: would probably have a share that might ensure profit in the future, you have control,and
get your interest, in the long run get more money (investor pov)
Entrepreneurship - ANS - Working for oneself
- New market with new or existing products/ services; or an existing market with new products.
- No seperation between owner/ manager
- process of discovering, evaluating, and exploiting opportunities
- creating new organizations of any type- "social entrepreneurs"
4 @COPYRIGHT 2026 ALLRIGHTS RESERVED.
QUESTIONS AND ANSWERS GRADED A+
2025/2026
Why study business/ management? - ANS Many of you will ultimately work for businesses in
management functions; some will work for businesses which you own.
-Others will analyze businesses - financial/ investment analysis, business journalism
- others will manage - people, information, processes... but outside for-profit business -
government, not-for-profit organizations
What businesses have been affected the most by COVID-19? - ANS - Hospitality, tourism;
travel cancellation leads to closure in hotels, bars and restaurants.
- Secondary: transportation, and food service, insurance, retail store,
Have any businesses benefitted from COVID-19? - ANS - e-commerce
- health care services
- Face mask factories
- delivery service
- Game makers
How has COVID-19 impacted the hospitality industry - ANS - Increased sanitation
- Management of people
1 @COPYRIGHT 2026 ALLRIGHTS RESERVED.
,- Change in corporate strategy
- Supply change
Describe the ripple effect - ANS
What do CEOs need to consider when pausing/resuming operations - ANS
Wealth Creation- component - ANS Combination of inputs
Supportive Environment
Means of production
Someone who will pay more than costs
What is required to create wealth? - ANS - The interdependence of business and society
- The diamond: number of diff
The diamond - ANS An effective political system enables economic growth, a developing
society must create a financial system capable of transferring funds where they are in surplus to
projects where funds are needed.As enabling governments and financial systems grow strong,
they enhance the prospects for entrepreneurial activity.Finally, as new enterprises grow, they
rely on more sophisticated methods of coordination and control (sophisticated management).
How is wealth created? - ANS - Develop a product or service that you can sell for more than it
cost
- Trade with economies that will pay for what you have and sell you what you want
Forms of Private Business Ownership - ANS - Sole proprietorships: own by one individual,
keep all profit but sustain all the lost by yourself.
cons: can take all your asset.
- Partnerships: similar to sole but own by multiple owners.
2 @COPYRIGHT 2026 ALLRIGHTS RESERVED.
,- Corporations: separate legal entities, they operate everything can sue and be sued.
Pros: financial liability (Can only take asset of the corporation not personal), risk distributed.
Cons: double taxation (corporate itself have to pay the taxes for the profit, and the owners have
to pay taxes for the profit as well), dilution of ownership (Don't get all the money for yourself),
lower control.
- Not-for-Profit Corporations: do not pursue profit
Franchising - ANS Contract-based business arrangement between a manufacturer or other
supplier, and a dealer, to produce and market the supplier's good or service.
- Franchisor and franchisee agreement
- 76,000 Franchise in Canada, employee a million of Canadians
- make more than 100 billion
- Franchising overseas is growing
Franchising pros - ANS Prior performance record
recognizable company name (brand)
proven business model
tested management program
savings through volume purchases
Franchising cons - ANS Franchise fees
future payments (royalties)
linked to reputation and management
franchise agreement restriction
tight control: limited creativity, there's a set of guidelines that you must follow.
Frinchisor loses control of franchisee when expanding overseas.
3 @COPYRIGHT 2026 ALLRIGHTS RESERVED.
, Corporate management - ANS Shareholders: acquires shares in exchange of ownership:
- Preferred shares: get dividends before common shareholders. Have cumulative dividend:
dividends accumulate over time.
- Common Shares: get the rest of the dividend, they can vote. Have a residual ownership, and
have additional money.
Board of directors: elected by shareholders to oversee corporation
Directors: make major corporate decisions and handle ongoing operations
Finding Financing - ANS Seed Capital: initial funding for new vendor.
Debt Financing: they don't control of your business, it is a loan
- Credit Cards
- Family and friends
- Bank loans
- Finance companies
- Pros: Higher chance that they would get their money back (investor pov)
Equity Financing: money that is invested that you don't have to pay back but share your profit
between your dividends and otherwise.
- Venture Capitalist
- Angel Investors
- Pros: would probably have a share that might ensure profit in the future, you have control,and
get your interest, in the long run get more money (investor pov)
Entrepreneurship - ANS - Working for oneself
- New market with new or existing products/ services; or an existing market with new products.
- No seperation between owner/ manager
- process of discovering, evaluating, and exploiting opportunities
- creating new organizations of any type- "social entrepreneurs"
4 @COPYRIGHT 2026 ALLRIGHTS RESERVED.
