ch.6

In shaping the ultimate success or failure of a new venture, which of the following statements is applicable?

A single strategic variable is seldom responsible.

Which of the following are key questions to ask when screening an idea?

Is it proprietary?

A solid analysis is

a critical task in starting a new business.

Which of the following is a major reason for the failure of a new venture?

inadequate market knowledge

Product/market problems include which of the following?

unclear business definition

A new venture should be

unique

During the prestart-up phase of a new venture, which of the following are among the crucial five factors for success?

uniqueness of venture and expected growth

Using the failure prediction model discussed in the chapter, the risk of failure can be reduced by:

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

Many entrepreneurs lack

venture uniqueness.

A common human resource problem is

inflated owner ego.

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."

lack of objective evaluation

What is a critical consideration when assessing customer availability?

length of time needed to determine who the customers are and what their buying habits are

Independence and autonomy are the major driving forces behind which of the following types of ventures?

lifestyle ventures

One of the external problems new ventures face is

market knowledge

Many entrepreneurs lack _____ for their new venture.

objectivity

Three specific phases that a new venture goes through are

prestart-up, start-up, poststart-up.

When a customer sees a product that is superior to its competitors, ______ becomes less important.

price

General sources for a market feasibility analysis include

pricing data.

Which of the following as a factor contributing to new-venture failure?

product/market problems.

Timing is especially critical in which area?

marketing

In recent studies of new venture problems, dominant problems at start-up were related to:

sales/marketing

In recent studies of new venture problems, dominant problems during the growth stage were related to

sales/marketing

Financial considerations play a major role in

smaller profitable ventures

Sales growth is a critical factor in the

start-up phase.

Which of the following are questions an entrepreneur can ask to gain insight into the viability of a venture?

-Is it proprietary? -Are the initial production costs realistic? -Is the potential market large?

It is reported that _____ new firms have emerged in the United States every year since the mid-1990s.

600,000

Hiring and promotions on the basis of nepotism rather than qualification fall under the managerial problem of

the concept of a team approach.

The entrepreneurial motivations of individuals usually relate to which of the following factors?

the environment, the entrepreneur, & the venture

A checklist approach allows the entrepreneur to identify major strengths and weaknesses in factors of a new venture.

the financial, the marketing, & the organizational

The comprehensive feasibility approach is closely related to

the preparation of a thorough financial plan

The amount of capital required to start a new venture _____.

can vary considerably depending upon the industry

An approach developed as a criteria selection list from which entrepreneurs can gain insights into the viability of their venture is the

feasibility criteria approach.

Which formula defines the quick ratio?

financial assets/current debt

Researchers have described a "fully developed new firm" with a number of characteristics, including:

full-time commitment & formal financial support

Market feasibility analysis relies on

general economic trends and competitor data

Venture classifications include which of the following types of venture?

high-growth ventures

When premature entry into the marketplace causes the failure of a new venture, it can be termed

poor timing.

Rapid technological advances in many industries cause a concern for in new venture development.

rapid product obsolescence

Functional design of the product and attractiveness in appearance are an aspect of

technical feasibility

Product design, reliability, and safety are all examples of

technical feasibility

Which evaluation method enables an entrepreneur to judge the potential of the business?

the profile analysis

In determining the potential market, one should look _____ into the future.

three to five years

Failure of a new venture can be avoided

through a careful profile analysis.

Which of the following is critical to a product's success?

timing, marketing approach, & objectivity

A new venture must go through _____ phases.

three

The type of venture that is expected to attract venture capital would most likely be a

high-growth ventures

Poor financial understanding is characterized by which of the following?

inadequate understanding of costs and funding requirements

A common pitfall in selecting a new venture is

poor financial understanding.

Lack of finished product availability can affect

the company's image & the success of any venture

The results of a profile analysis enable the entrepreneur to judge

the potential of the business.