Bus 190 Exam 1

The question "for whom are you creating value?" is best answered by what component of the Business Model Canvas? A)Customer segment B)Customer relationship C)Key Partnership D)Key resources

A) Customer Segment

Which of the following is an example of a "wicked problem"? widespread famine in war-torn regions in Africa limited access to healthcare in rural India the global refugee crisis all of the above

All of the above

Which of the following should be included in the business plan? the answer to critical questions such as your proposed target customer a thorough analysis of your competition timelines for company milestones all of these

All of these

All of the following are basic mistakes that entrepreneurs often make when building financial projections, except for? A)Underestimating costs B)Bottom up instead of top down forecasting C)Underestimating time to generate sales D)Lack of time spent researching comparables

B) Bottom up instead of top down forecasting

The equation "Net Income = Revenue - Expenses" best describes which financial statement? A)Statement of Cash Flow B)Income Statement C)Shareholder's Report D)Balance Sheet

B) Income Statement.

Social entrepreneurs and traditional entrepreneurs are similar in that ______. both measure success solely based on profit both have the same mission and goals both measure success solely based on improving societal well-being both identify opportunities

Both identity opportunities

Which of the following is NOT true of most debt financing structures? A)No ownership in the company. B)1st in line to assets of the company if it fails. C)Generally issued in shares of stock. D)Secured by the assets of the company.

C) Generally issued in shares of stocks

Which of the following is NOT considered to be a viable exit strategy for an investor? Initial Public Offering Stock Buy Back Corporate Restructuring Sale of the company.

Corporate Restructuring

Where do most entrepreneurs get the idea for their business? A) Through brainstorming B) From mentors C)By reading entrepreneurship books D)By working in a particular industry

D) By working in a particular Industry

There are two different types of financing capital available for companies. They are: A)Equity & stock B)Debt & bonds C)Debt & dividends D)Debt & equity

D) Debt and Equity

The difference between the price at which you sell a product (revenue) and your COGS to produce the product is known as ____. A)Owner's Equity B)Net Income C)Liabilities D)Gross margin

D) Gross Margin

According to the BMC lecture what component most adequately outlines "differentiation" from competitors? A)Key Resources B)Channels C)Revenue Streams D)Key Activities

D) Key Activities

Hard assets such as specialized manufacturing equipment would be outlined in what component of the Business Model Canvas? A)Key Activities B)Key Partnerships C)Value Proposition D)Key Resources

D) Key Resurces

Which of the following is NOT one of the three types of basic financial statements? A)Balance Sheet B)Statement of Cash Flows C)Income Statement D)Shareholder's Report

D) Shareholders Report

What component of the Business Model Canvas best describes your proposed solution? A)Revenue model B) Customer segments C)Key activities D) Value proposition

D) Value Proposition

Which of the following is NOT a truth about entrepreneurship? Entrepreneurship is reserved for startups. Entrepreneurship can be taught, as it is a method that requires practice. Entrepreneurs collaborate more than they compete. Entrepreneurship is a life skill.

Entrepreneurship is reserved for startups.

A convertible debt agreement allows an investor to transition their equity shares to a debt note when certain milestones are reached, such as raising an additional round of financing.

False

Although critically important to the economy, young businesses/startups don't provide the same impact from a job creation standpoint as mature firms.

False

During the business planning process the entrepreneur should spend zero time focusing on the uncertainties and external risks surrounding the model and instead pay attention only to the known components within their control.

False

Entrepreneurs are traditionally extreme risk-takers.

False

Entrepreneurship is best taught as a linear process that will lead to a specific destination.

False

From an investor's perspective, SAFE investment vehicles are stronger options than Convertible Notes because they allow for loan interest to be accumulated prior to conversion to equity.

False

In regards to investment strategy, venture capital investors tend to be geographically focused as opposed to industry focused.

False

In the United States venture capital funding is often the first form of equity capital a company will receive.

False

Library resources and databases serve as a great source of primary information for business plan development.

False

One income based company valuation technique is to analyze the liquidation value of a company's assets if the pieces were sold on the open market

False

The Business Model Canvas is meant to be a static document and not iterated upon.

False

The majority of new ventures created in the United States are based on the development of new proprietary technologies

False

The term "dilution" in the context of equity finance is the process by which investors recover their investments.

False

There are no downsides to the "buy-one, give-one" business model (exp. Tom's Shoes).

False

Unfortunately it is not possible to find detailed information about a business' finances unless it is a publicly traded company.

False

"Wicked problems" are defined as ______. problems without conflicting values large, complex social problems with no clear solution problems with clear and abundant information problems with obvious solutions

Large, Complex social Problems with no clear solution

Changes in customer buying behavior that occur throughout the year is referred to as ______. Seasonality Consumer trends Cash influx Market fit

Seasonality

Which of the following is NOT an example or characteristic of a "wicked problem"? The problem is not understood until after the formulation of a solution. Wicked problems have no stopping rule. Solutions to wicked problems are right or wrong. Every wicked problem is novel and unique.

Solutions to wicked problems are right or wrong

Social entrepreneurship is the process of ______. forming strictly nonprofit ventures sourcing innovative solutions for any type of problem sourcing innovative solutions for social and environmental problems re-branding a company's image to appear more socially responsible

Sourcing innovative solutions for social and environmental problems.

In entrepreneurship the only way to get results is to ______. think deeply plan obsessively take action avoid risk

Take Action

Which of the following is a component of The Practice of Entrepreneurship? create financial projections take small action write a business plan get financing

Take small action

A company can show a profit on its Income Statement but still go out of business due to a lack of cash.

True

Calculating the size of a given customer market can be helpful to determine whether or not it is worth an entrepreneur's time and resources to pursue their business idea.

True

Entrepreneurship can be learned

True

Entrepreneurship is more of a method than a process.

True

Many suggest writing your executive summary after you have completed the full business plan.

True

Proforma statements play a critical role in helping an entrepreneur set metrics and goals prior to launch.

True

The creation approach allows entrepreneurs to determine their goals according to whatever resources they have at hand.

True

The formula that best describes a Balance Sheet is "Assets = Liabilities + Shareholder's Equity."

True

With the exception of family and friends, an investor must fit the parameters of being an accredited investor in order to buy equity shares of a privately held company.

True

The aim of a social purpose venture is to ______. only resolve a social problem only make a profit both resolve a social problem and make a profit create awareness about a social issue

both resolve a social problem and make a profit

In enterprising nonprofits, ______. both the venture mission and the market impact are for social purposes profits can be distributed to the owners profits can be shared with shareholders a small percentage of profits can be challenged back into the organization

both the venture mission and the market impact are for social purposes

Earned income activities allow enterprising nonprofits to ______. accept funding from the government accept donations from other nonprofits receive financial assistance such as grants with a high level of engagement by the funder sell products or services that are used as a source of revenue generation

sell products or services that are used as a source of revenue generation

The biggest difference between social entrepreneurship and corporate social responsibility is ______. social entrepreneurship places equal emphasis on social and economic goals corporate social responsibility places equal emphasis on social and economic goals social entrepreneurship eschews economic goals corporate social responsibility prioritizes social goals over economic goals

social entrepreneurship places equal emphasis on social and economic goals