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This test consists of 15 multiple choice questions and 5 short answer questions.

Multiple Choice Questions

1. Which of the following was not one of Kroc's failures?
(a) Filet-O-Fish.
(b) The Hulaburger.
(c) Jane Dobbins Pie Tree chain.
(d) Raymond's restaurant.

2. Kroc, with McDonald offices in Chicago and Los Angeles,:
(a) Retired.
(b) Spent two weeks of each month in each city.
(c) Stayed in Los Angeles.
(d) Stayed in Chicago.

3. Which of the following was not a part of McDonald's programs in the 1970s?
(a) Minority hiring programs.
(b) Energy consumption programs.
(c) Expansion of Hamburger U.
(d) Campaign to reduce prices.

4. After marrying Joni and giving the Beverly Hills house to Jane, the Kroc's:
(a) Bought another house in Beverly Hills.
(b) Moved to his Southern California ranch.
(c) Moved to Chicago.
(d) Lived on his Yacht.

5. In exchange for the loan, McDonald's would:
(a) Yield managerial control until the loan is repaid.
(b) Change their mangement policies.
(c) Give the group a seat on the board.
(d) Pay .5% of gross sales for three periods.

6. Why was Kroc as interested in California?
(a) The state had a potential equal to almost the rest of the US market.
(b) He wanted to get away from Chicago.
(c) The McDonald brothers lived there.
(d) It was the site of the original McDonald brothers stores.

7. What was Harry Sonnenburn involved in at this time?
(a) Looking for a new job.
(b) Starting his own company.
(c) Looking to hire a new president.
(d) Preparing to take the company public.

8. Which position did Ray Kroc hold in the corporation?
(a) Chief executive officer.
(b) President.
(c) Chairman.
(d) Owner.

9. How did McDonald's solve its identity problem and improve sales in Calfornia?
(a) Television advertising campaign.
(b) Lowered prices.
(c) Improved quality.
(d) Hired new managers.

10. How did Kroc view prices and price increases?
(a) Every penny mattered to the consumer.
(b) Price increases should be tied to the cost of living.
(c) The fifteen cent hamburger price had to be maintained.
(d) McDonald's should charge the highest price the market would bear.

11. How does Kroc describe McDonald's?
(a) A conglomerate.
(b) An organization of loosely affiliated regions.
(c) A corporate monolith.
(d) An organization of small businessmen.

12. What problems did McDonalds face in the Washington DC area that Kroc resolved?
(a) Exclusive licensing .
(b) Poor quality.
(c) Low volume.
(d) Poor management.

13. One of the biggest problems in California was with:
(a) Real estate.
(b) Space requirements.
(c) Staffing.
(d) Suppliers.

14. As a result of the exclusive licensing agreement, McDonalds:
(a) Received a lower percent of sales.
(b) Lost business to competitors.
(c) Had no say in the management issue.
(d) Couldn't open a store in the area.

15. What term does Kroc use to describe new product development?
(a) The domain of the operators.
(b) Capitalism in action.
(c) The menu is limited to his favorite dishes.
(d) The response of customer demands.

Short Answer Questions

1. Where does Kroc decide he is going at the end of the chapter?

2. How many regions did McDonalds plan to establish?

3. Why were people wearing chef's hats given free admission to the park the day?

4. What did Kroc do with the baseball park non-player staff?

5. Kroc decided to restructure the company for administrative purposes by:

(see the answer keys)

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