test 1

Based on 2012 tax schedules, the first dollar of corporate income is taxed at which of the following marginal tax rates: a. 05.0% b. 10.0% c. 15.0% d. 20.0% e. 25.0%

15.0%

Based on 2012 tax schedules, the highest marginal tax rate on personal taxable income is: a. 25.0% b. 28.0% c. 33.0% d. 35.0% e. 40.0%

35.0%

According to Appendix A of Chapter 4, NOPAT is defined as: a. revenues times (1 + tax rate) b. revenues times (1 - tax rate) c. EBITDA times (1 - tax rate) d. EBIT times (1 - tax rate) e. net income times (1 + tax rate

EBIT times (1 - tax rate)

Which of the following is not a "kind" of patent? a. Utility b. Design c. Mark d. Plant e. Business method

Mark

Economic Value Added (EVA) is calculated as: a. NOPAT plus after-tax dollar cost of financial capital used b. ROE minus percentage cost of financial capital c. NOPAT minus after-tax dollar cost of financial capital used d. ROE plus the percentage cost of financial capital

NOPAT minus after-tax dollar cost of financial capital used

A venture's value is determined by a. the size and timing of its future free cash flows b. time value of money c. its net income d. a and b e. a and c

a and b

A well-designed entrepreneurial venture typically includes: a. generating ideas b. analyzing the feasibility of ideas c. producing business models/plans d. only a and c above e. a, b, and c above

a, b, and c above

"Fads" are: a. not predictable b. have short lives c. do not involve macro changes d. all of the above

all of the above

A SWOT analysis focuses on which of the following components or areas? a. strengths b. weaknesses c. opportunities d. threats e. all of the above f. a, b, and d

all of the above

Which of the following is a source of cash? a. an increase in accounts receivable b. a decrease in wages payable c. the acquisition of land d. an increase in the amount owed on a note payable e. the repurchase of outstanding shares of stock

an increase in the amount owed on a note payable

Which of the following is not depreciated? a. inventory b. machinery c. land d. both a and b e. both a and c

both a and c

Which of the following is not a life cycle stage of a successful venture? a. development stage b. startup stage c. survival stage d. cash cow stage e. early-maturity stage

cash cow stage

Which one of the following is not considered to be a current asset? a. cash b. receivables c. inventories d. fixed assets

fixed assets

During the development stage, seed financing chiefly comprises: a. funds from business angels and venture capitalists b. the entrepreneur's personal assets c. funds from family and friends d. a, b, and c e. only b and c

only b and c

Which of the following forms of protecting intellectual property currently has a protection limit of 20 years? a. copyrights b. patents c. trade secrets d. trademarks

patents

Which one of the following would not be considered a type of venture financing? a. seed financing b. startup financing c. mezzanine financing d. liquidity-stage financing e. seasoned financing

seasoned financing

The balance sheet equation states that total assets = a. total liabilities + depreciation b. total liabilities + owners' equity c. owners' equity + net income d. owners' equity + current liabilities e. total liabilities + net income

total liabilities + owners' equity

What is the survival revenues breakeven based on: cash fixed costs = $400,000 and a variable cost revenue ratio = .65? a. $460,500 b. $615,385 c. $1,142,857 d. $2,000,334 e. $4,000,667

$1,142,857

Find the NOPAT given the following information: sales = $520,000, earnings before interest = $100,000; interest = $20,000; and the tax rate = 30%. a. $70,000 b. $56,000 c. $30,000 d. $24,000 e. $10,000

$70,000

Determine the return on assets (ROA) for a venture with the following financial information: revenues = $500,000; net profit = $70,000; and asset turnover = 2.00 times. a. 10% b. 14% c. 20% d. 28% e. 34%

28%

Find the "contribution profit margin" based on the following information: cash fixed costs = $60,000; variable costs = $70,000; and sales = $100,000. a. 70% b. 60% c. 30% d. 40% e. 100%

30%

Based on 2012 tax schedules, the highest marginal tax rate on corporate taxable income is: a. 25.0% b. 28.0% c. 35.0% d. 38.0% e. 39.0%

39.0%

The free cash flows to equity of an entrepreneurial firm includes cash flows to: a. venture investors b. creditors c. the entrepreneur d. a and b e. a and c f a, b, and c

a and c

Which of the following is a use of cash? a. a decrease in inventory b. an increase in accrued liabilities c. the sale of an asset for a gain d. a drop in the amount owed on a bond e. an increase in stock issued

a drop in the amount owed on a bond

Which of the following is not a characteristic of inventories? a. raw materials b. finished products c. goods sold but not yet shipped d. work-in-process

goods sold but not yet shipped

Which one of the following is not considered to be an internal operating schedule? a. income statement b. cost of production schedule c. cost of goods sold schedule d. inventories schedule

income statement

Some venture investors like to draw analogies between baseball terms and venture performance. The baseball term used to reflect a total loss of an investment is: a. home run b. single c. strikeout d. double

strikeout

Determine the cost of goods sold for a venture with the following financial information: revenues = $50,000; net profit margin = 20%; gross profit margin = 70% a. $40,000 b. $35,000 c. $15,000 d. $10,000

$15,000

A firm with constant variable costs has a survival revenue breakeven of $375,000. This year it had $250,000 in sales, $100,000 of which was a fixed cost. What are the firm's cash fixed costs? a. $150,000 b. $225,000 c. $625,000 d. $937,500

$150,000

Find the "survival revenues" (SR), also known as the EBDAT breakeven) based on the following information: cash fixed costs = $60,000; variable costs = $70,000; and sales = $100,000. a. $85,714 b. $100,000 c. $116,667 d. $200,000 e. $300,000

$200,000

Your venture has total assets of $690, net fixed assets of $500, long term debt of $80, and stockholders' equity of $400. What is the amount of your venture's current liabilities? a. -$100 b. $100 c. $210 d. $290 e. $1,090

$210

Determine the dollar amount of total assets for a venture with the following financial information: revenues = $500,000; net profit = $70,000; and asset turnover = 2.00 times. a. $100,000 b. $250,000 c. $375,000 d. $500,000 e. $650,000

$250,000

. In its first year, Joe's Start-Up Company had revenues of $125,000 and cost of goods sold of $81,250, which was the only variable cost. Depreciation was $20,000, and cash costs were $5,000 in financing costs, admin expenses of $50,000, and $45,000 in marketing expenses - all of which were fixed. What is the survival breakeven revenue? a. $342,857 b. $285,714 c. $271,429 d. $184,615 e. $153,846

$285,714

Determine the dollar amount of revenues for a venture with the following financial information: net profit = $60,000; assets turnover = 1.5 times; and return on assets 30%. a. $300,000 b. $500,000 c. $800,000 d. $1,000,000 e. $1,200,000

$300,000

Find the NOPAT breakeven revenues (NR) given the following information: total operating fixed costs = $75,000; variable costs = $150,000; and sales = $200,000. a. $100,000 b. $240,000 c. $300,000 d. $400,000 e. $460,000

$300,000

Assume that you can sell a new product at $5.00 per unit. Your variable costs are $3.00 per unit and you fixed costs are $20,000. What will be your profit before taxes if you sell 12,000 units next year? a. $0 b. $1,000 c. $2,000 d. $4,000 e. $8,000

$4,000

Use the following information to determine the cash fixed costs: Administrative expenses = $200,000; Marketing expenses = $180,000; Depreciation expenses = $100,000; and Interest expenses = $20,000. a. $380,000 b. $400,000 c. $480,000 d. $500,000 e. $620,000

$400,000

Last year a firm had sales of $200,000. Its cost of goods sold was $75,000, and administrative and marketing expenses were $25,000 each. Depreciation expense was $10,000, while interest expense was $15,000. If the tax rate is 30%, what was the firm's NOPAT last year? a. $19,500 b. $35,000 c. $45,500 d. $52,500 e. $80,500

$45,500

Determine the total operating fixed costs (TOFC) based on the following: Administrative expenses = $200,000; Marketing expenses = $180,000; Depreciation expenses = $100,000; and Interest expenses = $20,000. a. $200,000 b. $380,000 c. $400,000 d. $480,000 e. $500,000

$480,000

You have the opportunity of making a $5,000 investment. The outcomes one year from now will be either $4,500 or $6,000 with an equal chance of either outcome occurring. What is the expected outcome? a. $4,500 b. $6,000 c. $5,250 d. $5,750 e. $5,000

$5,250

Determine the dollar amount of net profit for a venture with the following financial information: revenues = $500,000; return on assets = 20%; and asset turnover = 2.00 times. a. $10,000 b. $25,000 c. $50,000 d. $60,000 e. $75,000

$50,000

Determine gross profit of a venture with the following financial information: cost of goods sold = $30,000; net profit = $17,000; asset turnover = 1.6; return on assets 32% a. $85,000 b. $72,000 c. $55,000 d. $38,000

$55,000

What is the survival revenues breakeven based on the following: Administrative expenses = $200,000; Marketing expenses = $180,000; Depreciation expenses = $100,000; and Interest expenses = $20,000; and a variable cost revenue ratio = .50? a. $400,000 b. $600,000 c. $800,000 d. $1,000,000 e. $1,200,000

$800,000

Last year, Beth's Baked Goods exactly broke even with cash fixed costs of $63,000. If its breakeven survival revenue level was $94,000, what was its variable cost revenue ratio (VCRR)? a. .27 b. .30 c. .33 d. .67

.33

Determine the asset intensity of a venture with the following financial information: net profit = $22,000; revenues = $132,000; return on assets 30%. a. .05 b. .56 c. 1.8 d. 20

.56

An average score on using the VOS Indicator¬TM would fall in the range: a. 0.00-0.99 b. 1.00-1.66 c. 1.67-2.33 d. 2.34-3.00

1.67-2.33

You have the opportunity of making a $5,000 investment. The outcomes one year from now will be either $5,000 or $6,000 with an equal chance of either outcome occurring. What is the expected rate of return? a. 10% b. 15% c. 20% d. 25% e. 30%

10%

Assume that you can sell a new product at $5.00 per unit. Your variable costs are $3.00 per unit and you fixed costs are $20,000. What is your breakeven point in sales units? a. 5,000 b. 7,500 c. 10,000 d. 12,500 e. 15,000

10,000

Based on 2012 tax schedules, the first dollar of personal taxable income is taxed at which of the following marginal tax rates: a. 05.0% b. 10.0% c. 15.0% d. 20.0% e. 25.0%

10.0%

A project requires an initial investment of $1,000,000. In one year, there is a 40% chance of a $950,000 return; a 50% chance of a $1,200,000 return; and a 10% chance of a $2,000,000 return. What is the project's expected return one year from now? a. 12.8% b. 15.5% c. 18.0% d. 38.3%

18.0%

Harry Dent documented major generation waves in the United States during the twentieth century in: a. 1972 b. 1982 c. 1993 d. 2003

1993

Which of the following numbers of shareholders is allowed in a Subchapter S (or S) corporation business form? a. 74 b. 125 c. 130 d. 500

74

You are considering investing in two independent projects "A" and "B". Project A requires an initial investment of $12,000. In one year, there is a 30% chance of a $10,500 return; a 50% chance of a $12,500 return; and a 20% chance of a $14,500 return. Project B requires an initial investment of $1,000. In one year, there is a 25% chance of a $950 return; a 25% chance of a $1,000 return; and a 50% chance of a $1,200 return. If you require a 7% return on your investment after one year, you should: a. Accept A and reject B b. Accept B and reject A c. Accept both projects d. Reject both projects

Accept B and reject A

Which of the following is not a "type" of mark? a. Trademark b. Service mark c. Collective mark d. Certification mark e. Design mark

Design mark

A firm's net operating profit after taxes (NOPAT) is calculated as: a. net profit b. EBIT times one minus the tax rate c. EBT minus interest paid d. EBIT times the tax rate

EBIT times one minus the tax rate

Lindsey and Tobias have the opportunity to invest in a project that requires an investment of $3,000. There is a 35% chance of a $2,900 return; a 40% chance of a $3,400 return; and a 25% chance of a $4,500 return one year from now. Lindsey requires a 15% return on the project after the first year, but Tobias requires a return of only 12%. Using the expected rate of return: a. Lindsey and Tobias should both invest in the project b. Only Tobias should invest in the project c. Only Lindsey should invest in the project d. Lindsey and Tobias should both reject the project

Lindsey and Tobias should both invest in the project

Which of these statements is correct? a. The development stage occurs between the startup and survival stages of a venture's life cycle b. The early-maturity stage is the final stage of a new venture's lifecycle c. Firms typically begin to cover all expenses with internally-generated funds during the survival stage d. During the startup stage, revenues grow much more rapidly than cash expenditures e. None of the above

The early-maturity stage is the final stage of a new venture's lifecycle

A "score" in the range of 2.34-3.00 using the VOS IndicatorTM ¬¬¬¬ ¬would be considered a: a. a low score b. an average score c. a high score d. a very, very high score

a high score

When conducting a SWOT analysis, "unfilled customer needs" are examined in terms of: a. strengths b. weaknesses c. opportunities d. threats e. a or b f. c or d

a or b

Total operating fixed costs (TOFC) equal: a. cash operating fixed costs (excluding interest expenses) b. noncash fixed costs (e.g., depreciation) c. interest expenses d. a plus b e. a plus b plus c

a plus b

SWOT analysis should at the very least consider which of the following areas: a. experience/expertise b. reputation value c. first mover d. a and b e. a, b, and c

a, b, and c

Entrepreneurial finance is the application and adaptation of financial tools and techniques to an entrepreneurial venture. Entrepreneurial finance involves: a. planning b. funding c. operations d. valuation e. a and d above f. all of the above

all of the above

The factor categories in a VOS indicator are: a. industry/market considerations b. pricing/profitability considerations c. financial/harvest considerations d. management team considerations e. all of the above f. a, b, and d

all of the above

While entrepreneurial opportunities come from an almost unlimited number of sources, this textbook focuses on: a. societal changes b. demographic changes c. technological changes d. crises and bubbles e. emerging economies and global changes f. all of the above

all of the above

Financial statement that provides a snapshot of a business' financial position as of a specific date is called the: a. income statement b. balance sheet c. statement of retained earnings d. statement of cash flows

balance sheet

Return on assets can be stated as which of the following? a. net after-tax profit divided by total assets b. net profit margin times asset turnover c. net cash flow divided by total assets d. both a and b e. both a and c

both a and b

. Maximizing the value of the venture to its owners is the common financial goal of which of the following? a. the entrepreneur b. the debtholders c. the venture equity investors d. both a and b e. both a and c

both a and c

Successful entrepreneurs exhibit which of the following traits? a. recognize and seize commercial opportunities b. economic pessimism c. tend to be doggedly optimistic d. both a and b e. both a and c

both a and c

Which of the following business organizational forms provides the owners with limited investor liability and passes its income before taxes through to the owners? a. partnership b. subchapter S (or S) corporation c. regular or (C ) corporation d. limited liability company (LLC) e. both a and b f. both b and d

both b and d

Which is not a major source of start-up financing for a venture's startup stage? a. entrepreneur's assets b. business operations c. family and friends d. business angels e. venture capitalists

business operations

A written document that describes the proposed venture in terms of the product or service opportunity, current resources, and financial projections is called a: a. financial plan b. business plan c. entrepreneurial plan d. survival plan

business plan

Which of the following is not a category on the statement of cash flows? a. cash flow from operating activities b. cash flow from equity activities c. cash flow from investing activities d. cash flow from financing activities

cash flow from equity activities

"Net cash burn" occurs when the sum of which of the following items is negative? a. cash flows from operations and financing b. cash flows from investing and financing c. cash flows from operations and investing d. cash flows from net income and depreciation e. cash flows from operations and net income

cash flows from operations and investing

Cash includes all of the following except: a. coins b. currency c. checking accounts d. certificates of deposit

certificates of deposit

The rules and procedures established to govern the corporation are called the a. corporate charter b. articles of incorporation c. corporate bylaws d. confidentiality disclosure agreements e. partnership agreements

corporate bylaws

Which form of business organization typically offers the easiest transfer of ownership? a. proprietorship b. limited partnership c. corporation d. subchapter S corporation e. general partnership

corporation

Direct costs of producing a product or providing a service is called a. gross profit b. gross profit margin c. net profit d. net profit margin e. cost of goods sold

cost of goods sold

The goal of the entrepreneurial process is to: a. develop opportunities b. gather resources c. manage and build operations d. create value

create value

The first three stages of a successful venture's life cycle occur in the following order: a. development, rapid growth, survival b. startup, development, rapid growth c. startup, survival, rapid growth d. survival, rapid growth, early-maturity e. development, startup, survival

development, startup, survival

A typical business plan includes all of the following sections except: a. executive summary b. business description c. marketing plan and strategy d. disclosure of pending litigation e. operations and support

disclosure of pending litigation

The last stage in a successful venture's life cycle is called the: a. rapid growth stage b. early-maturity stage c. development stage d. survival stage e. startup stage

early-maturity stage

"E-commerce" refers to: a. environmental commerce b. electronic commerce c. economic commerce d. exploratory commerce

electronic commerce

Which of the following is not considered to be a mega-trend in this textbook? a. societal, demographic, and technological changes b. crises and bubbles c. fads d. emerging economies and global changes

fads

The process involving minimizing the need for financial capital and finding unique sources for financing a new venture is referred to as: a. mezzanine financing b. financial bootstrapping c. seed financing d. startup financing

financial bootstrapping

The type of financing that occurs during the survival stage of a venture's life cycle is typically referred to as the: a. seed financing b. startup financing c. first round financing d. second round financing e. mezzanine financing

first round financing

About one-half of all newly created businesses in the U.S. are dissolved or cease operations within how many years after being started? a. two years b. four years c. six years d. eight years

four years

The first two requirements of a sound business model are: a. generate revenues, make profits b. make profits, produce free cash flows c. produce free cash flows for creditors and owners of the venture generate revenues and produce free cash flows

generate revenues, make profits

A sound business model includes a plan to: a. generate revenues, make profits b. make profits, produce free cash flows c. produce free cash flows for the owners of the venture d. generate revenues, make profits, and produce free cash flows

generate revenues, make profits, and produce free cash flows

Revenues minus the cost of goods sold is called a. gross profit b. gross profit margin c. net profit d. net profit mar

gross profit

When moving from entrepreneurial opportunities to new businesses, products, or services, which one of the following is not considered a component? a. ideas b. feasibility c. business plan d. harvest of vent

harvest of venture

A viable venture opportunity is characterized by all of the following except? a. creating or meeting a customer need b. has perceived attraction to prospective investors c. provides an initial competitive advantage d. is timely in terms of time-to-market e. offers the expectation of added value to investors

has perceived attraction to prospective investors

The definition of an entrepreneurial firm is: a. survival, high growth b. high growth, high performance c. survival, average performance d. high, growth, average performance

high growth, high performance

Which of the following is not a characteristic of marketable securities? a. short-term b. illiquid c. high-quality d. interest-bearing

illiquid

Effective entrepreneurial management teams should include all of the following except? a. provide expertise in the areas of marketing, finance, and operations b. have successful experience in the venture's industry and markets c. work collaboratively with each other d. share the entrepreneurial spirit e. in-house accounting, auditing, and tax professionals

in-house accounting, auditing, and tax professionals

Financial statement that reports the revenues generated and expenses incurred over an accounting period is called the a. income statement b. balance sheet c. statement of retained earnings d. statement of cash flows

income statement

All else held constant, a higher asset turnover: a. increases ROA b. decreases ROA c. has no effect on ROA d. may raise or lower ROA, depending on how it affects revenues

increases ROA

Certification marks are typically used to: a. indicate membership in a trade group b. indicate a certain brand of service c. indicate quality d. are symbols used to associate products to a specific brand

indicate quality

The evaluation of "entry barriers" occurs under which one of the following parts of the VOS indicator? a. industry/market considerations b. pricing/profitability considerations c. financial/harvest considerations d. management team considerations

industry/market considerations

A typical business plan includes all of the following except: a. management team b. financial plans and projections c. risk and opportunities d. timeline and milestones e. initial public offering information

initial public offering information

In a general partnership, legal action that treats all partners equally as a group is called: a. joint and several liability b. joint liability c. limited liability d. accrued liability e. general liability

joint liability

Firms that allow owners to pursue specific lifestyles while being paid for doing what they like to do are referred to as: a. salary-replacement firms b. lifestyle firms c. entrepreneurial ventures d. rapid value creation firms

lifestyle firms

Which one of the following is not a part of the VOS indicator? a. industry/market considerations b. pricing/profitability considerations c. financial/harvest considerations d. management team considerations e. location/profitability considerations

location/profitability considerations

Developing new and delivering high-quality products or services that command higher prices and margins best describes strong a. marketing practices b. financial practices c. operating practices d. management practices

marketing practices

During a venture's rapid growth stage, funds for plant expansion, marketing expenditures, working capital, and product or service improvements is obtained through a. seed financing b. second round financing c. mezzanine financing d. seasoned financing e. liquidity stage financing

mezzanine financing

At the end of a qualitative-based venture opportunity screening exercise, the interviewer prepares a subjective assessment and indicates one of the following except for: a. natural commercial potential b. high commercial potential c. average commercial potential d. low commercial potential

natural commercial potential

Free cash flow to equity is the cash available to the entrepreneur and venture investors after all of the following except? a. net cash flows b. operating cash outflows c. financing and tax cash flows d. investment in assets needed to sustain the venture's group e. net increase in debt capital

net cash flows

Dollar profit left after all expenses, including financing costs and taxes have been deducted from the firm's revenues is called a. gross profit b. gross profit margin c. net profit d. net profit margin e. cost of goods sold

net profit

The return on assets (ROA) model measures: a. revenues divided by net profit times the asset turnover b. net profit margin times the equity multiplier c. net profit margin times asset turnover d. net profit divided by total assets multiplied by the asset turnover

net profit margin times asset turnover

"Gross earnings" is equal to: a. Revenue - After-Tax cost of financial capital used b. net income ÷ sales c. (net sales - the cost of production) × tax rate d. net sales - the cost of production

net sales - the cost of production

A SWOT analysis does not focus on which of the following components or areas? a. strengths b. weaknesses c. new ideas d. opportunities e. threats

new ideas

Free cash flows, which can be paid back to investors occurs when cash generated from operations exceeds all of the following except? a. borrowing costs b. non-cash depreciation c. taxes d. investment in assets

non-cash depreciation

While one must be careful to avoid too many generalizations about entrepreneurial traits or characteristics, which one of the following characteristics would not normally be associated with successful entrepreneurs? a. being able to see and seize a commercial opportunity b. planning for the venture's future c. only being able to see an opportunity after it ceases to be one d. being optimistic about the venture's success

only being able to see an opportunity after it ceases to be one

Which of the following does not describe activity during the venture's life cycle startup stage? a. venture's organization b. venture's development c. operating cash flows are generated d. initial revenue model is put in place

operating cash flows are generated

A lease that provides maintenance in addition to financing and is also usually cancelable is called: a. capital lease b. liability lease c. operating lease d. asset lease e. equity lease

operating lease

"Retained earnings" is: a. a corporate asset b. part of owners' equity c. neither a or b d. both a and b

part of owners' equity

When composing the financial plans and projections section of a business plan, all of the following should be included except: a. income statements and balance sheets b. statement of cash flows c. past and present dividend per share information d. breakeven analysis e. funding needs and sources

past and present dividend per share information

Which one of the following components is not a standard component of a sound business model? a. produce low-cost products b. generate revenues c. make profits d. produce free cash flows

produce low-cost products

In the Kauffman Center study of best practices of high-growth, high-performance firms, which of the following practices was not included? a. marketing practices b. financial practices c. management practices d. production/operations practices

production/operations practices

In which form of business organization are the owners not offered the protection of limited liability? a. proprietorship b. limited partnership c. corporation d. subchapter S corporation e. limited liability corporation

proprietorship

Which form of business organization is characterized by having the shortest start-up time and lowest legal costs? a. proprietorship b. limited partnership c. corporation d. subchapter S corporation e. limited liability corporation

proprietorship

Mezzanine financing is associated with which one of the following life cycle stages: a. development stage b. startup stage c. survival stage d. rapid growth stage e. early-maturity stage

rapid growth stage

Which stage in the venture life cycle is characterized by creating and building value, obtaining additional financing, and examining opportunities? a. survival stage b. startup stage c. rapid growth stage d. early-maturity stage

rapid growth stage

A firm's option to abandon a venture is an example of a: a. bootstrapping option b. financial option c. survival option d. real option

real option

A sound business model provides a plan which includes all of the following except? a. generates revenues b. makes profits c. retains all its earnings d. produces free cash flows e. all of the above are included

retains all its earnings

EBDAT is equal to: a. revenues - variable costs - cash fixed costs b. revenues + variable costs + cash fixed costs c. revenues - variables costs - total fixed costs d. revenues + variable costs - cash fixed costs

revenues - variable costs - cash fixed costs

U.S. small businesses are predominately: a. salary-replacement or entrepreneurial firms b. lifestyle or entrepreneurial firms c. entrepreneurial ventures d. salary-replacement or lifestyle firms

salary-replacement or lifestyle firms

Obtaining bank loan, issuing bonds, and issuing stock is characteristic of which type of financing during the venture's life cycle? a. seed financing b. second round financing c. mezzanine financing d. seasoned financing e. liquidity stage financing

seasoned financing

Indicate the number of principles of entrepreneurial finance that are emphasized in this textbook: a. one b. three c. five d. seven e. nine

seven

About 60 percent of all newly created businesses in the U.S. are dissolved or cease operations within how many years after being started? a. two years b. four years c. six years d. eight years

six years

A venture's value to its owners is determined by the: a. size and timing of its future free cash flows (to equity) b. level of its past revenues c. prior losses and expenses d. all of the above

size and timing of its future free cash flows (to equity)

Which of the following is not a right or a duty of general partners? a. participation in profits and losses b. some liability for partnership obligations c. veto right on new partners d. eventual return of capital e. access to partnership books

some liability for partnership obligations

The stage that precedes the middle stage in a successful venture's life cycle is called the: a. rapid growth stage b. early-maturity stage c. development stage d. survival stage e. startup stage

startup stage

Financial statement that shows how cash, as reflected in accrual accounting, flows into and out of a company during a specific period of operation is called the: a. income statement b. balance sheet c. statement of retained earnings d. statement of cash flows

statement of cash flows

In which form of business organization is the taxation effects characterized by the income flowing to shareholders taxed at personal tax rates? a. proprietorship b. limited partnership c. corporation d. subchapter S corporation e. general partnership

subchapter S corporation

Which form of business organization is characterized as having unlimited life? a. proprietorship b. limited partnership c. limited liability corporation d. subchapter S corporation e. general partnership

subchapter S corporation

In breakeven analysis, solving for when EBITDA is equal to zero gives breakeven in terms of: a. economic revenues b. variable costs c. survival revenues d. fixed costs

survival revenues

At which stage of the venture's life cycle stage is best characterized by the period when revenues start to grow and when cash flows from operations begin covering cash outflows? a. survival stage b. startup stage c. rapid growth stage d. early-maturity stage

survival stage

The last three stages of a successful venture's life cycle occur in the following order: a. startup, development, rapid growth b. startup, survival, rapid growth c. survival, rapid growth, early-maturity d. development, startup, survival

survival, rapid growth, early-maturity

In the venture life cycle, moving from the development stage to the startup stage frequently begins with the preparation of a business plan. The business plan is a written document that describes the proposed venture in all of the following terms except: a. the proposed product or service opportunity b. the accounting data for the last five years c. current resources available to the venture d. financial projections

the accounting data for the last five years

The term that refers only to words, symbols, shapes, and similar items associated with products is: a. trademarks b. service marks c. collective marks d. certification marks

trademarks

Expenses or costs that vary directly with revenues are said to be: a. fixed expenses b. semi-fixed expenses c. semi-variable expenses d. variable expenses

variable expenses

A VOS indicator stands for: a. venture opportunity screening indicator b. viable opportunity statement indicator c. venture only success indicator d. viable assessment screening indicator

venture opportunity screening indicator