MAN3802.0M1 Chapter 1 - 6
What is the average unit of sale for a restaurant that serves $3,250 per day in meals to 200 customers per day? $20.00 $16.25 $14.00 $18.05 $17.25
$16.25
Performing due diligence may include ________. Doing Internet research Calling on existing franchisees Fully understanding the FDD of the franchise company Visiting the franchise headquarters All of the above
All of the above
Price should reflect the organization's ________. Vision Policy Strategy All of the above None of the above
All of the above
Subway restaurants can be found ________. In military bases In traditional stand-alone units In convenience stores In shopping malls All of the above
All of the above
Target market segments are defined by common factors such as ________. Demographics Geography Psychographics All of the above None of the above
All of the above
The Executive Summary contains the ________. Story of the business Funding request Management strengths Competition details All of the above
All of the above
The FDD includes information such as ________. Territory Fees and costs Contractual obligations Data regarding existing units All of the above
All of the above
The formula provided by the franchise does which of the following? Ensures ongoing support Guarantees brand recognition Eases the issues of start-up development Removes the creativity and freedom All of the above
All of the above
The product life cycle phases include ________. Growth Introduction Decline Maturity All of the above
All of the above
Typically, you will have to secure more capital to buy a business than to start one up because you are paying for the ________. Supplier relationships Skilled employees Established customer base All of the above None of the above
All of the above
Understanding the status and trends of an industry can be aided by ________. Checking out the internet public library, your local Small Business Administration, chamber of commerce, or local business school or college library Looking on competitors' Web sites Looking for recent articles on the industry in magazines or by using Google or other search engines All of the above None of the above
All of the above
When you make an in-person presentation to prospective investors you should ________. Use clear visual aids Engage the listeners' interest Introduce yourself All of the above None of the above
All of the above
When you make an in-person presentation to prospective investors you should ________. Use clear visual aids Introduce yourself Engage the listeners' interest All of the above None of the above
All of the above
Which of the following aspects would the franchisor control in a business-format franchising situation? Quality assurance Accounting Operations Marketing All of the above
All of the above
Which of the following is a step in determining how customers decide to buy a product? Analyze the buying process Determine the need it meets Think about who might actually buy it All of the above None of the above
All of the above
________ is/are a source for leads regarding businesses for sale. Competitors Suppliers Customers Your current employer All of the above
All of the above
All of the following are components of control over compensation except ________. Salary Dividend Wage Commission All of the above are components of control over compensation.
All of the above are components of control over compensation.
Buying a successful business can help an entrepreneur in all of the following ways except ________. Reducing risk Issues of location Product or service delivery Customer development All of the above are helpful.
All of the above are helpful.
Which of the following could be considered an internal opportunity? Foreclosure of homes in the United States Changes in the buying habits of potential customers New competition New technology An interest or hobby
An interest or hobby
Telemarketing is a form of ________. Public relations Advertising Direct marketing Publicity None of the above
Direct marketing
To help determine whether your business will be profitable, calculate your ________. The difference between the costs and profits for one unit Cost of goods sold Economics of one unit Finances of one unit Rate of goods sold
Economics of one unit
A(n) ________ is a 15- to 30-second summary of your business. Advertisement Story Financing presentation Sales pitch Elevator pitch
Elevator pitch
Which of the following could not be considered opportunity costs? Entertainment Time Energy Money All of the above can be considered opportunity costs.
Entertainment
The ________ section of the business plan should be written last. Company Description Cover Page Mission, Vision, Culture Financial Statements Executive Summary
Executive Summary
A business plan cannot help you decide whether your idea is viable. True False
False
A manufacturing type of business sells an intangible product to businesses or consumers. True False
False
A new version of an existing product is considered an invention. True False
False
A product is something that is intangible. True False
False
A serious professional investor does not care whether you have a business plan or not. True False
False
A tactic is a plan for outperforming the competition. True False
False
A target market can never be too broad and unfocused. True False
False
A trade-off can be defined as giving up one thing to lose another. True False
False
An elevator pitch should take two or three minutes. True False
False
Approximately 50,000 businesses change ownership each year. True False
False
Business opportunities are based solely on the external market. True False
False
Economic forces, social forces, technological advances, and political and regulatory changes are not sources for finding competitive advantage. True False
False
Employees are not a particularly valuable part of an acquisition. True False
False
Every business idea is an opportunity. True False
False
Franchisees may pay a fee that is separate from the royalty fee, often called a cooperative advertising fee, to contribute to an individual advertising fund. True False
False
Friends and family are not viable sources for leads on existing businesses that might be for sale. True False
False
It is difficult to fall in love with the idea of owning a business and overlook the pitfalls and problems. True False
False
It is uncommon for a franchisor to handle the national and regional media purchasing for a franchisee. True False
False
Marketing is an isolated business function. True False
False
Master franchises do not allow individuals and organizations to buy the right to subfranchise within a delineated geographic territory. True False
False
McDonalds is the only franchise available for ownership internationally. True False
False
No matter what the price, in negotiation you must always close the deal with the purchase of your targeted business. True False
False
Robbery is a voluntary exchange. True False
False
Secret shoppers are part of the tracking primary research category. True False
False
Statistics dealing with the behavior of groups of people are called geographics. True False
False
The Millennial Generation's definition of success is less individualized than the traditional concept of success. True False
False
The executive summary of your business plan should be written before any other sections are complete. True False
False
The franchisor is the second party to the franchise agreement and is the owner of the unit or territory rights. True False
False
The offer price and the maximum amount you are willing to pay should encompass all of the financial factors you have identified. True False
False
The start-up and ongoing assistance provided by a franchisor guarantees your success. True False
False
There are few resources for franchise research. True False
False
You only need to be concerned with having a competitive advantage over direct competitors. True False
False
According to the text, which of the following is not a benefit of becoming an entrepreneur? Satisfaction Financial reward Fame Independence Self-esteem
Fame
A firm that has two or more members of the same family managing and/or working in it and that is owned and operated for the benefit of that family's members is called a ________. Family business Household business Mob business Domestic business None of the above
Family business
It is appropriate to interview all of the following except ________. Employees Former suppliers Customers Family members All of the above are appropriate to interview.
Family members
Writing a business plan can ensure that you ________. Make a profit Figure out how to make your business work Have no chance of failure Achieve your expense projection Meet your target revenue goals
Figure out how to make your business work
Which is not part of Schumpeter's definition regarding the ways that entrepreneurs find opportunities to create new businesses? Use an existing technology to produce an old product in a new way Find a new source of resources Find a new market for a new product Use an existing technology to produce a new product Use a new technology to produce a new product
Find a new market for a new product
A(n) ________ is a legal and commercial relationship between the owner of a trademark, service mark, trade name or advertising symbol and an individual or group seeking to use that identification in a business. Acquisition Opportunity License Merger Franchise
Franchise
The term "FDD" stands for which of the following? Franchisee Disclosure Document Franchisor Disclosure Document Franchise Disclosure Document Federal Disclosure Document None of the above
Franchise Disclosure Document
According to the text, which of the following is not a consideration when selecting a franchise? Research Gender Brand Self-reflection Geography
Gender
Cash flow valuation uses projected future cash flows and the ________ to arrive at a figure. Time value of money Value of investment Future customer demand Nominal value of money All of the above
Time value of money
Total gross profit = ________. Total revenue - Total cost of goods sold Total cost of goods sold - Total revenue Total revenue - Total profit Total profit - Total revenue None of the above
Total revenue - Total cost of goods sold
"Getting the job done" is an example of a value proposition in the Business Model Canvas. True False
True
A business plan is a document that thoroughly explains a business idea and how it will be carried out. True False
True
A market is identified by attitudinal, behavioral, demographic, and other characteristics. True False
True
A mission statement can provide direction and motivation to those who are involved in the business. True False
True
A unique selling proposition is the distinctive feature and benefit that sets you apart from your competition. True False
True
About one in five new businesses fails in the first eight years. True False
True
Although buying a business has many advantages that may translate into market benefits, you will also take over its challenges and problems. True False
True
An offer includes the complete bundle of products and services the entrepreneur will be bringing to the marketplace. True False
True
Annual reports of competitors can provide information for benchmarking and include industry insights. True False
True
As a franchisee you will benefit from the purchasing power of the franchisor to get lower costs and improved vendor service. True False
True
Assets on the balance sheet express what the business owns. True False
True
Barriers to entry are the factors that contribute to the ease or difficulty of a new competitor's joining an established market. True False
True
Business plan and pitch competitions provide advantages and disadvantages. True False
True
Buying into a business over time is an option that may permit a current owner to separate from a company over time, receive a stream of payments, and support customer loyalty. True False
True
Difficulty in finding and retaining necessary staff is a common undisclosed reason to sell a business. True False
True
In the introduction stage of the product life cycle, your product or service is new to the market and is essentially unknown. True False
True
Industry associations, chambers of commerce, and public agencies frequently collect demographic and statistical data on and for their members or constituents. True False
True
It may be against the law to use someone else's creative ideas as a basis to start your business. True False
True
Leaders of a company build a particular culture by making the beliefs, values, and behavioral norms explicit and intentional. True False
True
Marketing is the business function that identifies customers and their needs and wants. True False
True
One attribute of capitalism is that free market forces determine prices. True False
True
Primary research is conducted directly on a subject or subjects. True False
True
Product and trade-name franchising is the licensing of the product or the production of the product and the use of the trademark, logo, or other identity of the franchise. True False
True
Secondary research is carried out indirectly, through existing resources. True False
True
Sellers may be hesitant to disclose too much information to potential buyers. True False
True
Sound franchisors provide a significant quantity and excellent quality of start-up assistance to new franchisees, as well as ongoing education and support for established ones. True False
True
Target markets are groups defined by common factors such as demographics, psychographics, age, or geography. True False
True
The costs of franchises vary significantly. True False
True
The customer realizes a need in the awareness step of the buying process. True False
True
The function of a mission statement is to clarify what the business is trying to do in the present, but it can provide direction and motivation for future action through a clear and compelling message. True False
True
The offer can be defined as what the business will sell to customers. True False
True
The window of opportunity is the length of time you have to get your business idea to your market. True False
True
When doing financial projections, your financial estimates should be as realistic as you can make them. True False
True
With a family business, much like the acquisition of any going concern, there is a chance to build upon its strengths and to turn around problematic aspects. True False
True
Written survey questions should be clearly stated, easy to understand, and relatively short. True False
True
Which of the following is not a best practice? Write for your audience. Show that you are emotionally invested in the business. Use technical language and jargon. Show that you are financially invested in the business. None of the above is a best practice.
Use technical language and jargon.
If the Foreign Exchange rate between the Japanese yen and the euro is 190:1, how many yen will equal 10 euros? 300 1900 2000 500 1800
1900
What is a focus group? A method of market research that involves bringing together some people who might use a product and having a researcher question them about it A method of market research that focuses on competitor strengths A method of market research that involves collecting statistics about a group of people who might use a product A method of market research that focuses on how the industry is performing All of the above
A method of market research that involves bringing together some people who might use a product and having a researcher question them about it
The text defines profit as ________. A positive gain from operations before all expenses are subtracted A positive gain from operations after fixed expenses are subtracted A positive gain from operations after all expenses are subtracted A negative loss from operations after all expenses are subtracted None of the above
A positive gain from operations after all expenses are subtracted
Which of the following is a "problem" that an entrepreneur can address? A new computer processing technology A toy that does not meet the expectations of customers Renewed competition in an industry Legal changes All of the above
A toy that does not meet the expectations of customers
________ is not a sign of potential problems when practicing due diligence. Hesitancy to open up to questions Refusal to provide contact names Accurate information Inconsistent information Conflicting information
Accurate information
The most common standards for asset valuation do not include which of the following? Adjusted book value Liquidation value Adjusted liquidation value Replacement value Book value
Adjusted liquidation value
Nike sells sneakers, but it also markets sneakers, using ________ to get its message out to customers. Publicity Advertising Advertising and publicity None of the above
Advertising and publicity
In a whole business sale, the buyer acquires ________ of the company, known or unknown. Only the assets The building The customers None of the liabilities All assets and liabilities
All assets and liabilities
Decision-making criteria and priorities when searching for an existing business include ________. Geography Size Life cycle Industry All of the above
All of the above
Examples of poor fit include ________. Personality Work environment Lifestyle All of the above None of the above
All of the above
In analyzing your competitive advantage, you will need to ask three questions. Among these is/are ________. What is your unique selling proposition: What do you have that competitors cannot or will not match? Cost structure: Are you at a cost advantage or disadvantage? Competitive offers: How do you compare with competitors on a feature-by-feature basis? Both A and B All of the above
All of the above
In doing secondary research, there are several choices to help you. Among these are ________. Business library Books Magazine articles Internet research All of the above
All of the above
Indicating that you are assuming personal risk involves showing that ________. You are intellectually invested in the business. You are emotionally invested in the business. You are financially invested in the business. All of the above None of the above
All of the above
Jumpstarting your imagination about entrepreneurial opportunity can be done by asking yourself and others questions like ________. What is the one thing you would love to have more than anything else? What would it do? What problem have you encountered in everyday life and thought, "There has to be a better way to do this"? What would it look like? All of the above
All of the above
Market research can help you get a fix on who your customers are by determining ________. How old they are Where they live What benefit your product or service offers that would best or most attract them What kind of income they earn All of the above
All of the above
Marketing is ________. Satisfying customers at a profit The business function that identifies customer needs The business function that identifies customer wants The business function that identifies customers All of the above
All of the above
Nonfinancial variables to consider in valuation include ________. Competitive environment Market space Legal and regulatory status of the firm Customer goodwill All of the above
All of the above
Dividing a population on the basis of age, gender, income, or education is ________. Behavioral data Psychographics Marketing statistics Demographics Geographics
Demographics
Marketing is the satisfying of customer needs ________. At no profit At a profit With no attention to profit Regardless of profit At the breakeven point
At a profit
Which of the following is a way of looking at earnings valuation? Past earnings under new ownership Future earnings under new ownership Future earnings under current ownership All of the above B & C
B & C
By teaching customers how to use its products, Home Depot is helping customers see the ________ of its products. Ramifications Features Structure Benefits Qualities
Benefits
Which of the following aspects of a product/service is the most important to focus on when selling? Price Closing the deal Friendliness Benefits Features
Benefits
Smart marketers always emphasize ________. Benefits, not prices Features, not benefits Benefits, not features All of the above None of the above
Benefits, not features
Many fees are must be paid regardless of ________. Profitability Cash flow Sales Both A and B A, B, and C
Both A and B
A ________ is a company's plan to generate revenue and make a profit from operations. Business model Feasibility plan Business plan All of the above None of the above
Business model
Discovery of potential problems when buying a business is the responsibility of the ________. Buyer Customers Legal authorities Seller Employees
Buyer
Which of the following could be considered an acquisition? Buying a business from a retiring owner Building a new restaurant Starting a recycling business Inventing a new product and selling it Inheriting your father's business
Buying a business from a retiring owner
The free-market system is also called ________. Governance Capitalism Entrepreneurship Management None of the above
Capitalism
If a company does not have ________ it will fail. Advertising Cash Advisors A business plan Property
Cash
For your business to be successful you will need a strategy for beating the competition, that is, a ________. Target market Competitive advantage Competitive benefit Customer analysis Market analysis
Competitive advantage
Bankers and other potential investors will often refuse to see an entrepreneur who does not have a ________. Complete business plan Marketing plan Sales forecast Resume Penny
Complete business plan
Which of the following is not a tangible product? A pound of chicken Computer repair Dining room set Windows for your home A new car
Computer repair
According to the text, which of the following is not a cost of becoming an entrepreneur? Contribution to society Business failure Long Hours Loneliness Obstacles
Contribution to society
Franchisees may pay a fee that is separate from the royalty fee, often called a ________, to contribute to a shared advertising fund. Cooperative advertising fee Cooperative franchising fee Cooperative print fee Cooperative marketing fee Cooperative media fee
Cooperative advertising fee
Once you know your ________ you can calculate gross profit. Cost of goods sold Profit Unit of sale Gross cost Fixed costs
Cost of goods sold
The cost of producing one additional unit of a product is called ________. Cost of utilities Cost of goods sold Cost of materials Cost of services sold Cost of lease
Cost of goods sold
Making the beliefs, values, and behavioral norms explicit and intentional builds the ________ of an organization. Culture Vision Mission Goals All of the above
Culture
________ is/are the core values of an organization in action. Vision Culture Mission Goals None of the above
Culture
Which of the following is NOT a step in the buying process? Information search Awareness Evaluation of purchase Demographic analysis Evaluation of alternatives
Demographic analysis
As the buyer in a negotiation, you are working to do all of the following except ________. Secure the best price Give the buyer the most you can afford Maximize returns Reduce your initial investment capital costs None of the above
Give the buyer the most you can afford
Business leaders create wealth by ________. Avoiding the cost of hiring employees Charging high prices to customers Putting competitors out of business Reducing their gross margins Hiring employees in order to sell more units and generate more profit
Hiring employees in order to sell more units and generate more profit
Which of the following is not an economic question listed in the text? How much will it cost to be produced? Who will produce it? When will it be produced? Who gets to have what is produced? What should be produced?
How much will it cost to be produced?
Which of the following is not a type of franchising according to the text? Inclusive franchising Business-format franchising Product and trade-name franchising All of the above are types of franchising. None of the above is a type of franchising.
Inclusive franchising
Resumes and position descriptions should be included in business plans for ________. Key managers Customers All employees Stockholders Both A and B
Key managers
All of the following are a new type of franchising opportunity except ________. Conversion franchises Internet franchises Leapfrogging franchises Co-branding franchises Piggybacking franchises
Leapfrogging franchises
All of the following are selected franchise fees and costs according to the text, except ________. Local publicity campaigns Advertising and promotion Training Initial inventory Fixtures
Local publicity campaigns
All of the following are advantages of franchising except ________. Purchasing power Loss of control Financing assistance Promotional support Training
Loss of control
Strong franchisors have all of the following except ________. Many legal disputes Years of experience Positive relationships with their franchisees Established multiple franchises None of the above is an exception.
Many legal disputes
A ________ is a group of people who would be interested in buying a given product or service. Shopper Target Market Consumer Customer
Market
A(n) ________ is a group of people or organizations that may be interested in buying a given product or service, has the resources to purchase it, and is permitted by law and regulation to do so. Organization Industry Market Target market All of the above
Market
Consumers who have a similar response to a certain type of marketing can be classified as a ________. Market section Market Market segment Market part Market division
Market segment
Which business function do experts agree you should focus on first when preparing to start a business? Operations Production Financing Human resources Marketing vision
Marketing vision
Total cost of goods sold per unit consists of ________. Labor cost minus volume discount per unit Materials cost per unit plus labor cost per unit Volume cost plus labor cost Selling price per unit plus gross profit per unit None of the above
Materials cost per unit plus labor cost per unit
The marketing term that describes owning a perception in the minds of consumers is called ________. Consumer perception Market segment Consumer influence Mind share Market share
Mind share
Your ________ is a concise communication of your strategy including your business definition and your competitive advantage. Mission statement Business plan Target market analysis SWOT analysis Values statement
Mission statement
Trey has a T-shirt business that buys shirts from a wholesaler for four dollars each and sells them to retailers for eight dollars each. He imprints each shirt with a picture of a musical artist that costs him two dollars. He also pays his cousin to do the printing at five dollars an hour. LaShawn prints five shirts per hour. A retailer offers to buy 1000 shirts at seven dollars each. Should Tray agree to the deal? Yes, Tray will make a profit of two dollars per shirt. Yes, Tray will make a profit of one dollar per shirt. No, Tray will not make a profit at this price. No, Tray's profit at this price is too small. None of the above
No, Tray will not make a profit at this price.
A legal document enumerating the type of information that is to remain confidential is called a ________. Noncompete agreement Disclosure agreement Nondisclosure agreement Nondisclosure letter None of the above
Nondisclosure agreement
Jeffry Timmons' view on the qualities of opportunity includes all of the following except ________. Durable Attractive Timely None of the above All of the above
None of the above
Which of the following is not a question to ask yourself when considering your long-term vision? Who will take over then? At what age will you retire? Do you plan to grow the business to a certain size or level of maturity and then sell it? All of the above None of the above
None of the above
Two primary risks start-ups face are ________. Not finding a sufficient supplier and not being able to operate profitably Not finding a sufficient market and not being able to price profitably Not finding a sufficient market and not being able to operate profitably Not finding a sufficient market and not being able to do accounting profitably Not finding sufficient advertising opportunities and not being able to operate profitably
Not finding a sufficient market and not being able to operate profitably
The business definition has three elements: ________. Target market, potential customers, and production capability Business definition, target market, and market analysis Offer, target market, and production/delivery capability Offer, acceptance, and consideration None of the above
Offer, target market, and production/delivery capability
Which of the following items is not a competitive advantage? Using a new patented manufacturing process that reduces manufacturing costs by 25% Consistently providing better customer service than the competition Finding a better supplier at a lower cost Offering free samples during a two-week promotion Cutting costs on shipping by 50%
Offering free samples during a two-week promotion
A typical unit of sale for a wholesaler would be ________. A block of time devoted to a task One item One dozen One hour of work All of the above
One dozen
Market research is typically ________. Complete a year after product introduction Ongoing: You always do market research Complete within six months after introduction Complete when the product or service is introduced Complete prior to product introduction
Ongoing: You always do market research
Entrepreneurship options include ________. Not-for-profit organizations only For-profit ventures only Opportunities that are virtually limitless Only new technology and inventions Only green business options
Opportunities that are virtually limitless
A competitive advantage can be based on any of six factors. Which of the following is not one of the six? Quality Cost Service Opportunity Selection
Opportunity
One section of the business plan that is often neglected is the ________. Financial Projections Opportunity Analysis and Research Executive Summary Marketing Plan Management and Operations
Opportunity Analysis and Research
Which of the following is not part of a SWOT analysis? Strengths Weaknesses Threats Opposition All of the above are parts of the SWOT analysis.
Opposition
Advertising is ________ promotion through media outlets. Free Newsworthy Discounted Paid None of the above
Paid
It is ________ to buy a going concern for less than it would cost to start a similar company. Impossible Possible Improbable Definite Likely
Possible
The set of four stages that a product or market goes through from its beginning until its end is called the ________. Phases of product maturity Merchandise life cycle Product life cycle Marketing cycle Promotion cycle
Product life cycle
The four factors that form competitive advantage are ________. Product, packaging, promotion, and price Product, place, politics, and price Product, place, people, and price Product, price, promotion, and place Product, place, politics, and persistence
Product, price, promotion, and place
A franchisor's record of success can ________. Provide a significant advantage for your business start-up Never provide help for start-up Be a concern for a franchisee Not be counted on Be proven
Provide a significant advantage for your business start-up
All of the following can help reduce your learning curve except ________. Having transferrable skills from prior experience that fit the business Volunteer activities Read books about the industry Seeking out employment in the type of company you want to purchase All of the above can reduce your learning curve.
Read books about the industry
Your business plan projections should be ________. Optimistic and a bit of a stretch 100% fixed Incredible and impossible to reach Realistic and attainable Practical and easy to reach
Realistic and attainable
In relation to franchising advantages, you purchase the use of the company's logo, trademark, and advertising, as well as the physical design, layout, and décor that ensure ________. Uniformity Recognition Unity Consistency All of the above
Recognition
Franchisors are ________ to provide operating manuals and training to their franchisees, which are a valuable resource for success. Not required Encouraged Unable Required None of the above
Required
CH 1 & 2 QUIZ
STARTS HERE
CH 3 & 4
STARTS HERE
CH 5&6
STARTS HERE
CHAPTER 2
STARTS HERE
CHAPTER 3
STARTS HERE
CHAPTER 4
STARTS HERE
CHAPTER 5
STARTS HERE
CHAPTER 6
STARTS HERE
Research carried out indirectly through other existing resources is called ________. Ancillary research Literature analysis Primary research Tributary research Secondary research
Secondary research
Based on the idea of cost and benefits, which of the following activities is most beneficial? Playing video games Going to a movie with your favorite actor/actress Seeing a speaker you admire and want to mentor you Watching a PBS special about nature Hanging out with friends
Seeing a speaker you admire and want to mentor you
Which of the following is not a way to identify business opportunity as discussed in the text? Seeing opportunity where others see problems Training your mind to recognize opportunity Using your imagination Exploiting changes in the world Seeing what is wrong, but not a way to fix it
Seeing what is wrong, but not a way to fix it
Income statement projections realistically ________ in the first few months of operations. Show large profits Break even Show losses Show small profits Show medium profits
Show losses
Becoming a successful entrepreneur is a process that can be ________ and ________ by purchasing an operating business. Simplified, enhanced Complicated, accelerated Simplified, stunted Simplified, accelerated Convoluted, accelerated
Simplified, accelerated
Entrepreneur is a French word that originally meant ________. Someone who owns, runs, and makes financial gains in business Someone who owns a business Someone who makes financial gains in business Someone who undertakes any project that entails risk Someone who runs a business
Someone who undertakes any project that entails risk
With a family business, much like the acquisition of any going concern, there is a chance to build upon its ________ and to turn around ________ aspects. Strengths, tricky Gifts, problematic Strengths, problematic Strengths, awkward None of the above
Strengths, problematic
The most significant advantage of a franchise is the increased probability of ________, given that franchise brands have positive track records and instant recognition in most communities. Regret Failure Optimism Popularity Success
Success
________ ask(s) people directly through interviews or questionnaires about their perceptions of a product or service. Surveys and focus groups General research Industry research Secondary research methods Statistical research
Surveys and focus groups
For a business to be successful, a competitive advantage must be ________. Sustainable Clever Profitable Legal Expensive
Sustainable
Which of the following may not be an undisclosed issue when buying a business? The current owner is in poor health. Dissatisfied customers Failure to keep up with market trends Equipment is obsolete. Patents are no longer valid.
The current owner is in poor health.
It is best for ________ to write a new venture's business plan. The marketing manager The entire team The Chief Financial Officer A consultant The founder
The entire team
Due diligence can be defined as ________. The exercise of reasonable care in the evaluation of a business opportunity The exercise of equitable care in the evaluation of a business opportunity The exercise of sensible care in the evaluation of a business opportunity The exercise of rational care in the evaluation of a business opportunity The exercise of judicious care in the evaluation of a business opportunity
The exercise of reasonable care in the evaluation of a business opportunity
Which of the following represents a "change" associated with the "five roots of opportunity" explored in the text? The invention of the cell phone Expanded completion within an industry The green movement and society's new concern with recycling The entry of a new competitor Development of the technology for social networking
The green movement and society's new concern with recycling
An entrepreneur's market is ________. A three-square-block area surrounding his or her location His or her business's promotional activities The building where his or her business is located The group of people who are current and possible future customers All of the above
The group of people who are current and possible future customers
The foreign exchange rate is ________. The rate at which countries do business The value of products within a country The relative value between one currency and another The relative value between the dollar and foreign currencies The rate of trade
The relative value between one currency and another
Franchisors are focused on creating wealth for ________. Friends Employees Franchisees The community Themselves
Themselves
Which of the following is true regarding inspections conducted by franchisors? Very few franchisors do inspections. Specific times must be scheduled. It is unlawful to do such inspections. They may be announced or unannounced. They are always surprise inspections.
They may be announced or unannounced.
Which of the following is true regarding the costs of franchises? They vary significantly. They are outrageous. They are unaffordable. They are always expensive. They are unreasonable.
They vary significantly.
Which of the following is a typical characteristic of microenterprises? Constitute the bulk of the small businesses Usually have 5 or fewer employees Annual growth rate over 20% Require large amount of outside financial support Permit their owners to follow a desired pattern of living
Usually have 5 or fewer employees
Franchise operating guidelines ________. Are constant Are always well defined Vary considerably Never change All of the above
Vary considerably
A common undisclosed reason to sell a business is not ________. Lack of sufficient cash flow Unprofitability Wanting to retire Pending or active litigation Entrance of new competitors
Wanting to retire
Roddick suggested that you develop your entrepreneurial instincts by asking yourself all of the following questions below except ________. What is a product that has no flaws? What makes me annoyed or angry? What frustrates me the most when I try to buy something? What product or service would take away my aggravation? What product or service would really make my life better?
What is a product that has no flaws?
When has a market become saturated? When nobody wants to buy the product When there has been so much advertising and publicity that almost every person in the market is aware of the product When competitors have entered the market and forced the price of the product so low that the businesses selling it can no longer earn a profit When all customers decide that they do not like the product When most of the people in the market who are interested in the product have already purchased it
When most of the people in the market who are interested in the product have already purchased it
What type of business buys in bulk from a manufacturer and sells smaller quantities to a retailer? Consumer driven Attorney Wholesaler Service firm All of the above
Wholesaler
A retail business buys from ________ and sells to ________. Wholesalers, manufacturers Manufacturers, consumers Traders, consumers Vendors, consumers Wholesalers, consumers
Wholesalers, consumers
How does the public reward entrepreneurs who use resources efficiently to satisfy consumer needs? With awards With a pat on the back With praise With applause With profit
With profit
