ENT 396 CH.6

The entrepreneurial motivations of individuals relate to the entrepreneur, the environment, and the venture.

True

The type of venture that is expected to attract venture capital would most likely be a a. corporate venture. b. smaller venture. c. lifestyle venture. d. high-growth venture.

high-growth venture

Most entrepreneurs are objective when they evaluate their new idea

False

The decision of an entrepreneur to ignore the market is a safe one if he or she is sure that the idea will be a success

False

Feasibility analyses include technical, market, financial, organizational, and competitive analyses

True

Obtaining external financing is considered one of the major types of problems for a new venture during its first year

True

Solid analysis and evaluation of the feasibility of the product/service idea are critical tasks in starting a new business

True

Name the pitfall described by the statement, "Engineers and technically trained people are particularly prone to falling in love with an idea for a product or service." a. lack of objective evaluation b. no real insight into the market c. lack of venture uniqueness d. inadequate understanding of technical requirements

lack of objective evaluation

Most entrepreneurs are well schooled in the technology associated with their ventures

False

Overall market understanding rather than a time-consuming focus on market niches is sufficient for an evaluation

False

Surprisingly, growth of sales is generally not considered a critical factor in assessing new ventures

False

There is a great abundance of reliable data concerning the start-up, performance, and failure of new ventures

False

The entrepreneurial motivations of individuals usually relate to which of the following factors? a. the environment b. the entrepreneur (personal characteristics) c. the venture d. all of these

all of these

Which of the following is critical to a product's success? a. timing b. marketing approach c. objectivity d. all of these

all of these

An approach developed as a criteria selection list from which entrepreneurs can gain insights into the viability of their venture is the a. comprehensive feasibility approach. b. time-essence of a venture approach. c. marketability feasibility approach. d. feasibility criteria approach.

feasibility criteria approach

Market feasibility analysis relies on a. venture capital. b. the entrepreneur's vision. c. organizational competence. d. general economic trends and competitor data.

general economic trends and competitor data

Venture classifications include which of the following types of venture? a. high-growth ventures b. survival ventures c. hobby ventures d. smaller copycat ventures

high-growth ventures

Which of the following is a major reason for the failure of a new venture? a. opening in the wrong location b. inadequate market knowledge c. good product performance d. good product/poor marketing

inadequate market knowledge

Poor financial understanding is characterized by which of the following? a. lack of product differentiation b. failure to realize the life cycle of a product c. failure to anticipate technical difficulties d. inadequate understanding of costs and funding requirements

inadequate understanding of costs and funding requirements

Many entrepreneurs lack _____ for their new venture. a. innovation b. intelligence c. commitment d. objectivity

objectivity

A common pitfall in selecting a new venture is a. poor financial understanding. b. proper objective evaluation. c. real insight into the market. d. none of these.

poor financial understanding

Three specific phases that a new venture goes through are a. prestart-up, start-up, poststart-up. b. prestart-up, start-up, evaluation. c. beginning start-up, start-up, ending start-up. d. start-up, poststart-up, evaluation.

prestart-up, start-up, poststart-up

Which of the following as a factor contributing to new-venture failure? a. product/market problems. b. personality clashes. c. good management/poor product. d. family issues.

product/market problems

Rapid technological advances in many industries cause a concern for __________ in new venture development. a. inadequate awareness of competitive pressures b. rapid product obsolescence c. undercapitalization d. faulty product performance

rapid product obsolescence

Using the failure prediction model discussed in the chapter, the risk of failure can be reduced by: a. using less debt as initial financing and generating revenue in the initial stages. b. using more debt as initial financing and generating less revenue in the initial stages. c. using more revenue to enhance more debt in the initial stage. d. all of these.

using less debt as initial financing and generating revenue in the initial stages