Entrepreneurship

A small business usually has fewer than _____ employees.

100

Which of the following online businesses is the most likely to use the transaction fee model?

A clothing retailer

Success of entrepreneurial ventures is often jeopardized by the death of the founder. Which of the following is an important strategy to minimize this problem?

Adequate succession planning

Which of the following e-commerce models has advertisers pay for access to the demographic group that visits the operator's site?

Advertising support

YouChuse is on online business that allows people to upload their original artwork to be imprinted on cards and calendars, which are then offered for sale. What e-commerce model is YouChuse most likely using?

Affiliate

FactzDump.com pays commissions to other sites to drive business to its own sites. This is an example of which model?

Affiliate model

Which of the following would be classed as an entrepreneurial venture?

Angelo expects growth and high profitability from his new business.

An entrepreneur who is decisive, tenacious, disciplined, and willing to make sacrifices demonstrates which of the following characteristics?

Commitment and determination

Julieta decided that a growing Latino population has created an opportunity to market her family's salsa recipes. Which type of opportunity is she focusing on?

Demographic change

Lightning Inc., a car manufacturer, has started to sell electric cars in response to the rising fuel prices. In which of the following categories has Lightning Inc. spotted opportunities?

Economic dislocations

Which of the following descriptions of entrepreneurs is true?

Entrepreneurs know how to exploit opportunities.

Anshul worked as an engineer for FuturTech. He had many innovative ideas for the company, but most were never explored to his satisfaction. Therefore, he left the corporation to start his own business. He applied his ideas and thoughts to this business and finally succeeded. This is an example of ____.

Entrepreneurship

_____ occurs when an enterprising individual pursues a lucrative opportunity.

Entrepreneurship

Bad economic conditions make it especially difficult for an entrepreneurial organization to expand.

FALSE

Donna independently owns and operates Punkin's Pies, a small business with about 30 employees. She is happy with the size of her business and the average profits it generates. From this scenario, Donna's business can be considered an entrepreneurial venture.

FALSE

Entrepreneurial venture is just another name for a small business.

FALSE

In the subscription model for e-commerce, fees are charged to bring buyers and sellers together.

FALSE

Large corporations are merely passive bystanders in the entrepreneurial explosion.

FALSE

The best business plans convey five key factors: the financing, the opportunity, the competition, the succession plan, and risk and reward.

FALSE

The entrepreneurial strategy matrix allows one to conceptualize ventures along two dimensions: investment and risk.

FALSE

_____ is an entrepreneurial alliance between two organizations.

Franchising

_____ are a way for a business to raise capital through federally registered and underwritten sales of shares in the company.

Initial public stock offerings

_____ are also referred to as corporate entrepreneurs.

Intrapreneurs

Annika believes there is an opportunity to start up a business that produces sports equipment using greener technologies, thereby keying into two consumer trends. Into which category does opportunity fit?

Lifestyle and taste changes

Joakim wishes to open a new landscaping company that will have no services that are particularly distinctive compared to competitors in this well-established field; because of the need for trucks and equipment, the business will require a sizable investment. In which part of the entrepreneurial strategy matrix is new company likely to be located?

Lower-right quadrant

Richard worked as a teacher for several years before starting an educational games company. He has a clear vision of the result he is working to get. Moreover, he is aware of his strengths and weaknesses, and always sets realistic goals. In this case, which of the following characteristics of successful entrepreneurs does Richard possess?

Motivation to excel

Elliot interviews several entrepreneurs to learn what characteristics contributed to their success. Which of the following characteristics is most likely to be mentioned in the interviews?

Opportunity obsession

_____ are project teams designated to produce new, innovative products.

Skunkworks

Which of the following is one of the major liabilities of start-ups?

Smallness

_____ is a competitive advantage that exists in your relationships with other people and the image other people have of you.

Social capital

According to Peter Drucker, who should help plan succession for a family-managed business?

Someone outside the family and the business

Which of the following e-commerce models are online newspapers most likely to use?

Subscription

Which of the following statements about entrepreneurs and risk is the most accurate?

Successful entrepreneurs take very careful, calculated risks.

Entrepreneurs are frequently challenged by an aversion to record keeping.

TRUE

Organizations that encourage intrapreneurship face the obvious risk that the effort can fail.

TRUE

To be successful, entrepreneurs should be innovators and also have good knowledge and skills in management, business, and networking.

TRUE

Which of the following is the fundamental reason for creating an opportunity analysis?

To analyze whether or not to proceed

Which of the following is a reason why companies go public?

To raise more capital

Karen is evaluating whether she has the right personality to be an entrepreneur. Which of the following characteristics should she have if she wants to succeed?

Tolerance of risk and uncertainty

Steve works as a materials scientist for a paint manufacturer. He has developed a material that does not work well in paint, but it could have applications as a deck sealant. Steve has been made the team lead for a group of scientists tasked with determining some marketable uses for the new material. The group could be referred to as

a skunkworks

Benefits of business incubators typically include ____.

access to shared services

The primary objective of an entrepreneurial venture is to

acquire growth and high profitability.

Entrepreneurs manage _____ and develop _____ strategies, practices, and products.

aggressively; innovative

Margo works in the software development team for a large corporation. Her employer encourages employees to pursue new ideas on company premises and therefore she has a side project involving applications for small kitchen appliances. In this scenario, Margo's employer appears to support ____.

bootlegging

_____ refers to informal efforts—as opposed to official job assignments—in which employees work to create new products and processes of their own choosing and initiative.

bootlegging

"Horse trading," "making cheerleaders," "getting the blessing," and "clearing the investment" are the steps in

building support for an intrapreneurial idea.

Aleta is developing a new software company. She locates her business in an industrial park that offers low rent and shared support staff to start-up companies. This is an example of a _____.

business incubator

Protected environments for new, small business are known as _____.

business incubators

A(n) _____ is a formal planning step that focuses on an entire venture and describes all the elements involved in starting it.

business plan

Serena prepares a document that outlines her plan to open a new candy company, including descriptions of the product, the market, her strategies, and the future direction she envisions for the company. This document is a(n) _____.

business plan

The first step to building organizational support for an intrapreneur's idea that involves explaining the idea to his or her boss and seeking approval to look for wider support is called

clearing the investment

Renaldo is creating a business plan. His first formal step should be to

conduct an opportunity analysis.

A disadvantage of going public is the

creation of a long-term relationship with non-beneficial banking institutions.

One primary reason that entrepreneurs start their own firms is that they

dislike the bureaucracy in corporate life.

Which of the following online businesses uses the intermediary model of e-commerce?

eBay

An individual who establishes a new organization without the benefit of corporate sponsorship is called a(n)

entrepreneur

The tendency of an organization to engage in activities designed to identify and capitalize successfully on opportunities to launch new ventures by entering new or established markets with new or existing goods or services is called ____.

entrepreneurial orientation

Using his own money and resources, Leo—who had recently been laid off from his job—started a new business based on the innovative ideas that he himself had generated. This is an example of a(n)

entrepreneurship

Initial public stock offerings provide a way to raise capital through

federally registered and underwritten sales of shares in the company.

Most entrepreneurs start their own firms because they

feel satisfaction in creating something from nothing.

A reason why many entrepreneurs prefer to avoid going public is that they

feel they would lose control.

In order for family-managed businesses to survive and prosper, management guru Peter Drucker advises them to

fill at least one key position with a nonfamily member.

The transaction fee model involves companies charging fees

for goods and services

Entrepreneurs, in part because they are very busy, often fail to use ____.

formal control systems

Nargis is interested in running a business and decides to open a branch of a successful falafel shop that her sister owns in another town. In this case, Nargis could be best described as a(n) ____.

franchisee

A(n) _____ is an innovator who has created at least one successful store and seeks partners to operate the same concept in other local markets.

franchisor

Which of the following stages for building support for an idea involves guaranteeing the project's technical and political feasibility, often with a formal presentation to higher management?

getting the blessing

The essential ingredients in any recipe for entrepreneurial success are a great product or idea, a viable market, and _____.

good timing

According to many entrepreneurs and observers, when creating a new business, one should start with

great ideas

Hector comes up with a highly unusual but appealing idea for a new phone application. He would require a substantial amount of money to pay for developing the required graphics and technology. His idea can be categorized as involving

high innovation/high risk

Katie decides to offer one of her subordinates, Peter, his pick of tasks on a new project in exchange for his vocal support of it at an upcoming meeting. In this case, Katie is

horse trading

One of the most common reasons that entrepreneurial ventures fail is

improperly spending start-up capital.

IPO is an acronym that stands for

initial public stock offering.

People who have an entrepreneurial orientation tend to

innovate

Bringing buyers and sellers together and charging a commission for each sale is known as the _____ model.

intermediary

Nora works for a corporation and is using the company's resources to build a new line of business for her employers. Nora is a(n) _____.

intrapreneur

While working at Enterprisers Corp., Savvy has created a new venture based solely on her idea and Enterprisers' proprietary technology. Savvy can be described as a(n)

intrapreneur

People's judgment of a company's acceptance, appropriateness, and desirability, generally stemming from company goals and methods that are consistent with societal values, is known as

legitimacy

If a business's goals and methods are consistent with societal values, it is considered _____.

legitimate

Most small business ventures are in the _____ category of the entrepreneurial strategy matrix

low innovation/high risk

Entrepreneurship occurs when an enterprising individual pursues a(n) _____.

lucrative opportunity

While building support for one's idea, getting together people who will offer support before formal approval from higher levels is known as

making cheerleaders

Two major liabilities of start-ups are

newness and smallness

Bad economic times can

offer more opportunities to expand.

Which of the following key planning elements should provide a competitive advantage that can be defended?

opportunity

A(n) _____ includes a description of the good or service, an assessment of the opportunity, an assessment of the entrepreneur, a specification of activities and resources needed to translate the idea into a viable business, and the individual's source of capital.

opportunity analysis

The most dangerous risk in corporate entrepreneurship is possibility of

relying too heavily on a single large project.

Successfully fostering and managing intrapreneurship requires the company to

reward risk taking.

A business having fewer than 100 employees, independently owned and operated, not dominant in its field, and not characterized by many innovative practices is a(n)

small business

Ned has a wide network of relationships, and most of his acquaintances have a positive opinion of his intelligence and integrity. This is an example of

social capital

_____ provides a lasting source of competitive advantage.

social capital

Dr. Elbridge began helping women in Bajukistan obtain microloans for small business start-ups. This act is a typical example of

social entrepreneurship

EliteTimes requires regular viewers of its online articles to pay a monthly fee to maintain uninterrupted access to its content. This is an example of the _____ model.

subscription

Which of the following nonfinancial resources is crucial to the success of a new business?

top management teams

The _____ quadrant in the entrepreneurial strategy matrix depicts ventures of truly novel ideas with little risk.

upper-left

A product that represents a novel idea requiring little financial investment would be displayed in the _____ of the entrepreneurial strategy matrix.

upper-left quadrant