MGMT 310 Exam 1 - Chapter 3

________ is the process of determining whether a business idea is viable.

A) Feasibility analysis

A(n) ________ involves showing a preliminary description of a product or service idea to prospective customers to gauge customer interest, desirability, and purchase intent.

A) concept test

Which of the following is an example of a resource that normally would not be evaluated as part of the "resource sufficiency" stage of organizational feasibility analysis?

B) Financial resources

Which of the following factors is a positive as it pertains to the financial feasibility of a business venture?

B) High percentage of recurring revenue

The two components of industry/target market feasibility analysis are ________.

B) industry attractiveness and target market attractiveness

The two primary issues to consider in organizational feasibility analysis are ________.

B) management prowess and resource sufficiency

The most important issues to consider in financial feasibility analysis are ________.

B) total startup cash needed, financial performance of similar businesses, and the overall financial attractiveness of the proposed venture

Which of the following factors is a negative as it pertains to the financial feasibility of a business venture?

C) Inability to forecast income and expenses with a reasonable degree of accuracy

Which of the following is not an attribute of an attractive industry?

C) Is late rather than early in its life cycle

Which of the following is an incorrect approach to administering a concept test?

C) The best candidates to distribute a concept statement to are family and friends.

The two primary issues to consider in organizational feasibility analysis are management prowess and ________.

C) resource sufficiency

Which of the following is not a part of assessing the product/service feasibility of a business idea?

D) Analyzing industry attractiveness

________ feasibility analysis is a quick financial assessment of the viability of a business idea.

D) Financial

Which of the following issues should be considered in industry/target market feasibility analysis?

D) Industry attractiveness

________ feasibility analysis is conducted to determine whether a proposed business has sufficient management expertise, organizational competence, and resources to successfully launch its business.

D) Organizational

________ feasibility is an assessment of the overall appeal of the product or service being proposed.

D) Product/service

The focus in organizational feasibility analysis is on ________.

D) nonfinancial resources

The most important issues to consider in financial feasibility analysis are: financial performance of similar businesses, total cash needed, and ________.

D) overall attractiveness of the proposed venture

________ feasibility analysis is an assessment of the overall appeal of the industry and market for the product or service being proposed.

E) Industry/target market

A(n) ________ is a group of firms producing a similar product or service. A firm's ________ is the limited portion of the industry that it goes after or to which it wants to appeal.

E) industry; target market

Does it make sense? Is it reasonable? Is it something consumers will get excited about? Does it take advantage of an environmental trend, solve a problem, or fill a gap in the marketplace? These are the types of questions asked during the ________ feasibility component of a complete feasibility analysis.

E) product/service

The two components of product/service feasibility analysis are ________ and ________.

E) product/service desirability; product/service demand

A feasibility analysis is an assessment of a potential product or service idea rather than a potential business.

false

For financial feasibility analysis, a very detailed and comprehensive financial analysis is required.

false

The focus in organizational feasibility analysis is on financial resources.

false

The two components to product/service feasibility analysis are product/service desirability and total startup funds needed.

false

A new venture team is the group of founders, key employees, and advisers that either manage or help manage a new business in its startup years.

true

Feasibility analysis is the process of determining if a business idea is viable.

true

Industry/target market feasibility is an assessment of the overall appeal of the industry and the target market for the product or service being proposed.

true

Organizational feasibility analysis is conducted to determine whether a proposed business venture has sufficient management expertise, organizational competence, and resources to successfully launch its business.

true

Product/service feasibility analysis is an assessment of the overall appeal of the product or service being proposed.

true

The four forms of feasibility analysis include: product/service feasibility, industry/target market feasibility, organizational feasibility, and financial feasibility.

true

The most important issues to consider in financial feasibility analysis are total startup cash needed, financial performance of similar businesses, and overall financial attractiveness of the proposed venture.

true

The two primary areas to consider in organizational feasibility analysis are management prowess and resource sufficiency.

true