Small Business Management final

_____refers to actions by franchisors to void the contracts of franchisees in order to sell the franchise to someone else and collect an additional fee.

churning

Which of these involves bringing two franchise brands together under one owner?

co-branding

A small firm that provides low prices due to cost efficiencies is using a--

cost based strategy

A formal organization in which family members discuss strategic planning and other issues pertaining to the family business called a family _____.

council

an ____ business is a venture that is operated by a founding entrepreneur.

Owner-managed

A change in how we fundamentally see a situation is called a--

Paradigm shift

Which of the following is a characteristic of a family business?

A business that passes from one generation to the next

According to Gerber, all of the following are personalities that come into play when you are starting a business EXCEPT:

Administrative Personality

Entrepreneurs who receive an entire marketing and management system are participating in:

Business format franchising

Given the size, the ethical influence of a leader is more pronounced in a large corporation than it is in a small firm

False

One of the disadvantages of franchising is the inability on part of franchisees to use franchisor's trade name and trademark.

False

Research finds that, generally, the process of succession is usually very fast in a family business.

False

Research finds the due to lack of control, franchising is more risky than starting a business from scratch.

False

The basic features of the relationship between the franchisor and the franchisee are embodied in the broker contract

False

The general environment is defined more narrowly as the context for factors that directly impact a given firm and all of its competitors.

False

The internet has made it easier for people to steal the creations and ideas of others, including literary works, artistic products, and music. These creations are collectively known as trademarks.

False

The overlap of family concerns and business interest in the family firm simplifies management of the business.

False

a refugee is a person who tried entrepreneurship, failed and sought refuge in corporate employment

False

"Three big" stakeholders for organizations are employees, customers, and competitors.

False.

Microbusinesses are firms that provide substantial profits to their owners

False.

Unfortunately, a cost-based strategy usually doesn't work for small companies because they don't have the capacity to produce high volumes.

False.

a statement of principles intended to guide a family firm through times of crisis and change refers to a

Family business constitution

Members of the succeeding generation in family firms have emotional resistance to joining the firm which include all of the following EXCEPT:

Fear of Affluence

A popular tool for studying the industry environment is Porter's five factors. Which of the following is NOT considered part of the five factors?

Federal Government

Which of the following is NOT information contained in a disclosure document?

Franchisor's selling price

Which of these represent the second step in the ethical decision making process?

Identify alternative solutions

Which of the following is generally NOT an outcome when a business practices social responsibility?

Increased scrutiny from regulatory agencies

________ refers to a general sense of honesty and reliability that is expressed in a strong commitment to doing the right thing, regardless of the circumstances.

Integrity

Which statement s true about the startup rate for new businesses owned by women?

It has grown at a rate about 1.5 the national average

A microbusiness that permits the owner to follow a desired pattern of living refers to which of these

Lifestyle business

An outside-in analysis involves assessing the firm's--

The general environment and industry environment

Which of the following is NOT a potential problem in the succession of a family business?

The type of business conducted by the firm

which of the following is a reason for buying an existing business?

To acquire an ongoing business at a bargain price

A franchise Disclosure Document (FDD) is a detailed statement of such information as the franchisor's finances, experience, size, and involvement in litigation.

True

An economically attractive and timely opportunity that creates value for interested buyers and end users refers to entrepreneurial opportunity.

True

In a family business, the founder's core values may become part of both the business culture and the family code.

True

New technology involves using high-tech technology to simulate real life experiences.

True

The Internet has made it easier for users to copy intellectual property.

True

The notion of intergrity and ethics are closely tied

True

a potential advantage of the husband-wife team (co-preneurs) is the opportunity to share more of their lives.

True

The party in a franchise contract that specifies the methods to be followed and the terms to be met by the other party is called a

a franchisor

According to Spinelli and Adams, desirable entrepreneurial characteristics are all of these EXCEPT

be a domineering manager.

Doing more with less in terms of resources invested in business, and, where possible, controlling the resources without owning them refers to

bootstrapping

Small business can gain a competitive advantage through all of the following except

bootstrapping

The price at which the property would change hands between a willing buyer and willing seller when the former is not under any compulsion to buy and the latter is not under any compulsion to sell, both parties having reasonable knowledge of relevant facts refers to

fair market value.

A family business's primary function relates to the care and nurture of family members

false

According to the US small Business Administration, small enterprises hire 83 percent of all high-tech employees.

false

Core competencies are the same thing as competitive advantage.

false

Research finds that the general environment affects large businesses and not the small ones, regardless of the industry.

false.

A ________ analysis is a preliminary assessment of a business idea that gauges whether or not the venture envisioned is likely to succeed

feasibility

Long-term benefits of adopting ethical and responsible business practices include all of the following EXCEPT:

higher employee turnover

As a franchisee, costs involved in renting or building an outlet and stocking it with inventory and equipment are called ________.

investment costs.

Using the textbook's criteria for defining a small business, a new venture isn't a small business if it:

is engaged in geographically dispersed operations

A knowledgeable person who can offer guidance based in a given field is called a(n)--

mentor

A _______ assessment is focused less on whether industry conditions overall are suitable to launching a new business and more on the probability of a startup's success over the long run.

micro-level industry

The practice of employing relatives is referred to as--

nepotism

________ refers to startup ideas centered around providing customers with an existing product or service not available in their market.

new market ideas

A specific group of customers with an identifiable but narrow range of product or service interests refers to:

niche market

Under the restrictions of __________, the buyer promises the seller that he or she will not reveal confidential information or violate the trust that the seller has offered in providing the information.

nondisclosure agreement

A pattern of behaviors and beliefs that characterize a particular firm refers to its--

organizational culture

Of all the relationships in a family business, the _________ relationship is the most sensitive and troublesome.

parent-child

According to Blanchard and Peale, an organization's ethical policy should be based on all of these EXCEPT:

pattern

The primary source of new ideas is a--

personal experience

When Subway operates a restaurant within a truck stop, it is an example of ____ franchising

piggyback

In ______ franchising, a franchisor owns the right to a name or trademark and sells that right to a franchisee.

product and trade name

Ethical ______ holds the philosophy "When in Rome, do as the Romans do."

relativism

A family _______ is a gathering of family members, usually at a remote location, to discuss family business matters.

retreat

Relative to Coca- Cola, Pepsi Cola would be considered a ______________ to /for Coca Cola under Porter's Five Forces model.

rivalry

Accidental discovery involves _________, the facility for making desirable discoveries by accident.

serendipity

Women-owned businesses tend to be:

significantly smaller than men's

One unethical practice involves the concealing of business income. This practice is called is called:

skimming

Ethical companies feel that they have an obligation to their _________, the people who could be affected by the company's actions

stakeholders

SWOT stands for:

strengths, weaknesses, options, and trade.

A profitable company that responds to customers' needs while showing reasonable concern for the environment is called a(n)

sustainable small business

For the 10 years ending 2010, one of the most dramatic trends has been?

the increase in minority business owners.

the greatest advantage of buying a franchise is--

the probability of success

An example of a non-quantitative factor inbuying a business is future community development

true

An individual's beliefs affect what that person does on the job and how she acts towards customers.

true

When ABC International engages in the unethical practice of concealing business income, it is called skimming

true

outside analysis should consider the general environment, or big picture, and the industry setting in which the venture might do business.

true

Small business accounts for about what proportion of U.S. firms with employees?

99%

Small firms represent about___________ percent of all US exporters

97

Which of the following is not an advantage of family involvement in the business?

Children easily see the advantages derived from family participation in the business

Which of these is not a motivation for founding a company?

Community satisfaction

Which of the following is a consideration in the transfer of ownership in the family firm?

Consideration of tax laws

Which of the following is not a consideration in the transfer of ownership in the family firm?

Delay of transfer of ownership until death of the founder

"Be a good corporate citizen, and give back" represents which type of responsibility?

Discretionary

According to Entrepreneur magazine's "Top Franchises for 2012," McDonald's is ranked number 1

False

________ refers to fundamentally refocusing the startup as it unfolds or completely recreating it if the initial concept turns out to be seriously flawed, but already exists elsewhere.

Pivot

What is the purpose of the Foreign Corrupt Practices Act?

Prohibit US firms from paying bribes in foreign countries, including countries where such bribes may be legal.

If the children of teh founder become the owners and managers of the business, that second generation is referred to as a(n)--

Sibling partnership

which of the following is not a characteristic of a family council?

Small, selected group of employee's

Which of these refers to a company's ethical obligations to the community?

Social responsibility

Entrepreneur's Top 10 Franchises for 2012 include all of these EXCEPT:

Starbucks

Michael Porter lists five factors that determine the nature and degree of competition in an industry. Which of his factors describes, "Can customers turn to other products or services to replace those that the industry offers?"

Substitute products and services

a company markets an individual yogurt serving with a collapsible spoon attached to the cup. This firm is pursuing a _____________ strategy.

differentiation

Garden Hoses, Inc. (GHI) focuses on offering a products that are unique and different from competitors' products. GHI is engaging in the ________ strategy.

differentiation-based

All of the following are entrepreneurial qualities EXCEPT:

domineering

When the franchisor sells another franchise location within the market area of an existing franchisee it is called

encroachment

You, as a resident and citizen of USA, are conducting busienss abroad and make decisions based on local interpretations depending on the country you are in. You are using the philosophy of

ethical relativism