Midterm Review- Entrepreneurship Chapters 1, 3, 4, & 5

All business plans are essentially alike.

False

Any kind of information an entrepreneur can collect in market research is potentially valuable.

False

Because market research can be very expensive and time-consuming, it is usually not wise for a new business to use it.

False

Data that describes a group of people in terms of their tastes, opinions, personality traits, and lifestyle habits are called demographics.

False

Experienced entrepreneurs do not need business plans. Only those who are starting their first business need them.

False

If you concentrate your selling efforts on only a certain type of individual, instead of all people, your business will be less likely to succeed.

False

Information from SBA, SBDC, and SCORE is available only from print sources in the library.

False

It is a bad idea for an entrepreneur to center a business on a personal interest or hobby.

False

Markup and markdown prices are two methods of competition-based pricing.

False

Not all products have features.

False

Once you find appealing business opportunities, you are ready to set up your business.

False

Once you have developed a marketing strategy, it is time to analyze your target market.

False

Once your business is up and running, your business plan will not be of further use to you.

False

Over the past 50 years, the U.S. market has changed from being a consumer-driven market to one that is product-driven.

False

Pricing objectives should be developed only after prices have been set.

False

The SBA is made up of more than 10,500 retired executives who volunteer their time to provide entrepreneurs with real-world advice and know-how?

False

The bulk of the information about the business idea is contained in the appendix of the business plan.

False

The executive summary should be written before the main body of the business plan has been completed.

False

The objective of every pricing strategy is to increase profits.

False

The table of contents of a business report should include the name of your company, the date, the owner of the company, the title of the owner, and the address and phone number of the company.

False

Product characteristics that will satisfy consumer needs are called...

Features

A business plan is a written document that describes all the steps necessary for opening and operating a successful business.

True

A business plan may help you secure financing for your business.

True

A market segment is made up of people with common characteristics.

True

An entrepreneur should probably perform some secondary market research first to become more familiar with the market.

True

Different products and services within the same category serve different customer needs.

True

Do not be afraid to identify potential problems and risks in a business plan.

True

Ford Motor Company is an example of a manufacturing business.

True

Generally, it is less expensive for a business to collect secondary data than to collect primary data

True

Handwritten business plans are not acceptable; all business plans must be work processed and printed on standard-sized white paper.

True

In a consumer-driven economy, entrepreneurs realize that sometimes they must include products in their mix as a convenience for customers even though they may not be profitable.

True

It has been found that often a small percentage of the product selection makes up the majority of the sales revenue.

True

Many businesses fail because the owner lacks business knowledge.

True

One good question to ask yourself when you are identifying your target market is, "What needs or wants will my product or service satisfy?"

True

Sometimes a business opportunity arises from a discovery or invention.

True

The analysis of marketing data should be in written format so it can be referred to at a later date.

True

The total market for a product must be known in order for a market share to be determined.

True

There will usually be more than one price that can be charged for a product.

True

To avoid inconsistencies, it is a good idea to have an objective person review your final business plan before you show it to investors

True

When services are combined under one price, rather than making the customer pay for each individual part of the service, they are said to be bundled.

True

You can ask the same kinds of questions in a focus group that you would ask in a survey, but the group setting allows for more discussion and interaction regarding each question.

True

Your business plan is your best opportunity to let other people know what you want to do with your company.

True

People go into business for themselves...

all the answers are correct

About how long do most entrepreneurs spend preparing their business plans?

50 to 100 hours

The most common type of primary market research is...

A survey

_____________ is the name, symbol, or design used to identify your product.

Branding

The marketing _________________ uses the needs of customers as the primary focus during the planning, production, distribution, and promotion of a product or service.

Concept

Establishing informal ties with people who can help your business grow is called...

Networking

Creating an image for a product in the customer's mind is called...

Positioning

A brief explanation of why you are asking for a loan and what you plan to do with the money is called a statement of..

Purpose

Small businesses

can be more creative and take more risks than large companies

The first step in conducting market research is to...

define the question

Pricing that is determined by how much customers are willing to pay for a product or service is called...

demand-based pricing

A good business plan includes sales projections for the long term, which is considered...

five years in the future

A business plan does all if the following except

guarantee the success of your new business

Banks and investors male financing decisions about new businesses based on...

how well they think the business can meet it's objectives

Which of the following is not an element of the financial section of a business plan?

market information

Groups of customers within a large market who share common characteristics are known as...

market segments

A business's percentage of the total sales generated by all companies in the same market is called...

market share

Which of the following is generally considered a disadvantage of entrepreneurship?

must make all the decisions by themselves

How long should a statement of purpose be in a business plan?

no more than one or two paragraphs

This type of pricing technique starts out with low introductory price with the goal of building a strong customer base.

penetration pricing

If a store sells snow shovels for half-price in the middle of summer, the store is offering customers a....

seasonal discount

A barber shop is an of a(n)

service business

Which of the following would not be considered a mistake when preparing a business plan?

spending time studying the competition

This part of a business plan comes after the main body.

statement of purpose

Which of the following is a good resource for secondary data?

the U.S Census Bureau

All of the following would be included in the introduction section of a business plan except...

the location of your business

Successful entrepreneurs tend to have all of the following characteristics except..

they prefer to have someone else do the work

Organizations made up of professionals in specific industry are called

trade

Information that helps you determine how often potential customers use a particular service is called

use-based data

Before you open a new business, the two most important things to determine are who your primary customers are and...

whether these customers will be willing to buy your product or service