BOT 2613 Midterm
Sales records are of very little value to a buyer in evaluating a company's worth.
False
Timing has little to do with a new venture's success or failure.
False
Short-term debt is paid back in-
One Year
A method of raising capital is through the private placement of securiteies
True
Structured and focused chaos is necessary for creativity to occur.
True
When securing a bank loan, which of the following is not a question an entrepreneur should be prepared to answer?
What is the price of your product?
The most common source of debt financing is-
Commercial Banks
A great abundance of reliable data is available concerning the start-up, performance, and failure of new ventures.
False
An entrepreneur's decision to ignore the market is safe if he or she is sure that the idea will be a success.
False
Corporate venture capital can offer strategic and tactical advice, an operating budget, and credibility but started to decline in 2017, and this trend is expected to continue.
False
The innovation process involves only the development of a good idea.
False
The term risk versus loss refers to the amount of return for funds invested.
False
Truly creative people are always geniuses.
False
With a nonroutine venture, the initial innovation will maintain the company's competitive advantage without new technology.
False
Solid analysis and evaluation of the feasibility of the product/service idea are critical tasks in starting a new business.
True
Sophisticated investors are wealthy individuals who invest more or less regularly in new or early- and late-stage ventures.
True
The entrepreneurial motivations of individuals relate to the entrepreneur, the environment, and the venture.
True
The four basic types of innovation are invention, extension, duplication, and synthesis.
True
The growth pattern of sales is critical for an entrepreneur to make correct forecasts.
True
The most common sources of debt financing are commercial banks.
True
The terms upside gain and downside loss refer to the profits the business can make and the losses it can suffer.
True
The way to approach a new business venture is to design a good or service that is unique.
True
Uniqueness in a product or service can be demonstrated through a new-new approach or a new-old approach.
True
When purchasing an existing business, the prospective owner should conduct an assessment of the business's current group of employees.
True
Which of the following is not a key question a prospective buyer needs to ask in buying a business?
What is the owner's personal net worth.
A disadvantage of debt financing is-
Regular Interest Payments
Advantages of debt financing include all of the following except-
Regular Interest Payments
Which of the following is an example of an intangible asset?
Reputation
SEC stands for the-
Securities and Exchange Commission
Which of the following is not an advantage to buying a franchise business?
Structured Fees
Pricing becomes less of a concern when customers know about a product's unique characteristics that are superior to the competition.
True
Sources of debt financing include trade credit, accounts receivable financing, factoring, and finance companies.
True
Use of debt to finance a new venture involves a payback of the funds plus an interest fee (interest) for the use of the money.
True
39.A __ approach indicates the importance of people's awareness of their daily lives for developing new business ideas.
New-New
Which of the following is not type of debt financing?
Private Placement
Successful creations do not require investigation and information gathering.
False
The cognitive ability of entrepreneurs to acquire and transform information has yet to be studied.
False
Creativity cannot be developed or improved.
False
Most entrepreneurs are objective when they evaluate their new idea.
False
Most entrepreneurs hire lawyers to brief them on the legal issues surrounding a new venture.
False
A franchise is any arrangement where the owner has licensed others to sell goods or services by which of the following?
Trademark
Creativity, in the entrepreneurial context, is the generation of ideas that result in the improved efficiency or effectiveness of a system.
True
Entrepreneurs are always looking for unique opportunities fill needs or wants.
True
Entrepreneurs who exploit a radical new technology to provide a product and radically disrupt the market through the creation of a new product space represent the highest level of innovation "newness" relative to other alternatives.
True
Failure to anticipate the technical difficulties related to developing or producing a product can sink a new venture.
True
In negotiating a deal to purchase an existing business, it is possible to request that the seller retain a minority interest in the firm.
True
Innovation the process by which entrepreneurs convert opportunities into marketable ideas.
True
Lack of transparency and trust by the entrepreneur is a common cause of new- venture failure.
True
Many entrepreneurs do not understand the marketing life cycle of a new product.
True
Many inventions and innovations are a result of inventors seeing new and different relationships among objects, processes, materials, technologies, and people.
True