Quiz #2 (ch. 4-6)

Registration procedures for incorporation are uniform from state to state across the U.S. True, False

False (#1 state for incorporation is Delaware)

A corporation has: limited liability ease of transferring ownership continuity of life ability to attract financing all of the above

all of the above

Unlike large corporations, sole proprietorships do not need a business plan. True, False

False (a business plan is a guide, but businesses need to be flexible to new ideas)

_____ is the process of guiding the development, maintenance, and allocation of resources needed to attain organizational goals. Functional coordination Strategic planning Tactical planning Motivation Management

Management

An organization's _____ is its general purpose or reason for existence. Concept Mission Tactic business technique corporate culture

Mission

_____ are entrepreneurs who start a series of companies. Multipreneurs Intrapreneurs Multi-venturists Multi-faceted venturists Growth capitalists

Multipreneurs

A type of business entity that provides liability protection but is taxed like a partnership is a: Franchise general partnership C corporation S corporation joint venture

S corporation (a C corporation has its own tax structure)

The lowest level of management, which usually has the most people to manage, is called _____ management. Top middle Strategic Supervisory Functional

Supervisory

Dividing up the tasks (division of labor) is an important part of organizing. True, False

True

A disadvantage of a partnership is that any partner may have to pay all of the debts of the company regardless of who incurred the debts. True, False

True (be careful of who you go into business with!!)

Middle managers usually: act as representatives to other firms set overall goals and objectives manage the employees on the assembly line carry out plans and policies of top management act as figureheads for the company

carry out plans and policies of top management

Who owns a corporation? its employees its board of directors its president its board of directors and major stockholders everyone who owns a share of stock in the corporation

everyone who owns a share of stock in the corporation (majority stockholders make most of decisions)

A business plan: describes in detail the idea for the new business and how it will be carried out is used to persuade lenders and investors to finance the venture may take many months to write serves as the first operating plan for a new business is accurately described by all of the above

is accurately described by all of the above

A _____ is a formal document that states an organization's purpose and reason for existing and describes its basic philosophy. corporate manifesto mission statement Vision company proclamation principle of existence

mission statement

A common use of business plans is to: comply with SEC regulations persuade lenders and investors to finance the venture persuade customers to buy the new product or service use as a recruitment tool showcase innovative factors to production to make the company a success

persuade lenders and investors to finance the venture

The most common form of business organization is the: general partnership corporation sole proprietorship cooperative limited partnership

sole proprietorship

Which of the following is NOT one of the four functions of management? Planning Controlling Organizing Budgeting Leadership

Budgeting

With its ease of registration and pro-corporate policies, _____ is called the "state of incorporation." About half of the Fortune 500 companies are incorporated there. New York Delaware Ohio Georgia California

Delaware

_____ financing is a form of financing consisting of funds raised through the sale of stock in a business. Credit Debt Equity Monetary Venture

Equity

A good manager is never faced with unforeseen problems. True, False

False

A person who buys a franchise has the same level of control as an entrepreneur who opens his or her own sole proprietorship. True, False

False

Crisis, both internal and external, do not affect well-managed organizations. True, False

False

The difference between small business owners and entrepreneurs is that small business owners: are innovators started the business to pursue their idea for a new product or service are risk takers accept the status quo and take a short-term view of the future are accurately described by all of the above

accept the status quo and take a short-term view of the future (the first three describe entrepreneurs)

Which of the following describes a disadvantage associated with a corporation? double taxation cost of formation government regulations complexity of formation all of the above

all of the above

A corporation's board of directors: is appointed by the SEC is selected by the agency that chartered the corporation acts as organizational figureheads sets major corporate goals and policies should never have more than seven members

sets major corporate goals and policies (usually made up of senior level experts in several different backgrounds of knowledge, more diversity allows for more profitable decisions)

Most firms have three distinguishable levels of management. They are: low, middle, and chief functional, middle, and staff supervisory, middle, and top operational, supervisory, and top functional, operational, and strategic

supervisory, middle, and top

Entrepreneurs, as a general group, dislike risk taking. True, False

False

Multipreneurs are businesspeople who have tried a succession of entrepreneurial start-ups without finding an area in which they could be successful. True, False

False

The lowest level of management is engaged in strategic planning process. True, False

False

The proliferation of information technology no longer has any effect on today's managers. True, False

False

The two sources for debt financing are angel investors and venture capitalists. True, False

False (equity financing uses investors who expect financial return in company profits vs debt is bank loan)

Many classic entrepreneurs are _____ who start small and plan to keep their business small. Interpreneurs Multipreneurs Intrapreneurs growth entrepreneurs Micropreneurs

Micropreneurs

_____ planning is the creation of long-range, comprehensive objectives and the development of long-term courses of action. Tactical Strategic Operational Functional Supervisory

Strategic

_____ planning is short-range, detailed planning that is based on long-range planning. It typically has a time frame that is less than one year long. Tactical Strategic Hands-on Procedural Functional

Tactical

The specialized knowledge and ability that a person brings to a job, such as computer programming, is called a(n) ______ skill. hierarchical Technical functional subordinate tactical

Technical

A manager who makes one-directional decisions and seeks no input from her subordinates can be described as having an autocratic leadership style. True, False

True

Control is the mechanism for making sure the other three managerial functions--planning, organizing, and leadership--are operating smoothly. True, False

True

Leadership is the process of guiding and motivating others toward the achievement of organizational goals. True, False

True

Managers must act in interpersonal, informational, and decisional roles. True, False

True

Micropreneurs are entrepreneurs who start small and plan to stay small. True, False

True

Planning is the process of deciding what needs to be done to achieve organizational objectives; identifying when and how it will be done, and determining by whom it should be done. True, False

True

Technical skills are usually utilized at the lower levels of the organization. True, False

True

The corporation's board of directors elects the corporate officers. True, False

True

When companies in the same industry merge to achieve economies of scale and to expand their product lines, it is called a horizontal merger. True, False

True