Chapter 2 Questions

Characteristics often attributed to the entrepreneur include which of the following?

Commitment, determination, and perseverance

(T or F) The generation of the twenty-first century believe that career success will require them to be less nimble, independent, and entrepreneurial than past generations and focus on tried and true educational disciplines for long-term career stability.

FALSE. The dream of career success of the millennial generation (Generation Y) and post millennial generation (Generation Z) will require them to be more nimble, independent, and entrepreneurial than past generations.

Areas of risk to the entrepreneur include

career, family, psychic

A __________ is a statement of ethical practices or guidelines to which an enterprise adheres.

code of conduct

Entrepreneurial stress can be caused by having a type A personality which can be defined as:

having a chronic sense of time urgency.

Generally, entrepreneurial stress is due to

the discrepancy between the entrepreneur's expectations and the ability to meet demands.

The decision to behave entrepreneurially is the result of the interaction of

the individual's personal entrepreneurial mind-set and an opportunity.

Which of the following negative effects of an entrepreneur's inflated ego can result in a fantasy approach to business?

unrealistic optimism

Entrepreneurial cognition includes which of the following attributes?

- The understanding of how to simplifying mental models and piece together previously unconnected information. - The knowledge structures to make assessments, judgments, or decisions involving opportunity evaluation, venture creation, and growth. - The ability to identify and invent new products or services. - ALL OF THE ABOVE

(T or F) Commitment, determination, and perseverance are the only characteristics one needs to become a successful entrepreneur.

FALSE. A review of the literature related to entrepreneurial characteristics reveals the existence of a large number of factors and new characteristics are continually being added to this ever-growing list.

(T or F) A loss orientation toward grief recovery in dealing with failure can sometimes lessen negative emotional reactions.

FALSE. Empirical research has found that loss orientation toward grief recovery can sometimes exacerbate the negative emotional reaction.

(T or F) Today's entrepreneurs are faced with few ethical decisions because the legal system imposes greater penalties on wrongdoers.

FALSE. Ethical issues in business are of great importance today and entrepreneurs are faced with many ethical decisions, especially during the early stages of their new ventures.

(T or F) Ethics represents a set of principles prescribing a behavioral code that does not include moral duty and obligations.

FALSE. In the broadest sense, ethics provides the basic rules or parameters for conducting any activity in an "acceptable" manner but more specifically, ethics represents a set of principles prescribing a behavioral code that explains what is good and right or bad and wrong; ethics may, in addition, outline moral duty and obligations.

(T or F) The "dark side" of entrepreneurship refers to the stress that entrepreneur's experience.

FALSE. The dark side of entrepreneurship refers to the destructive and negative aspects found within the energetic drive of successful entrepreneurs that may envelop entrepreneurs and dominate their behavior and although each of these factors has a positive aspect, it is important for entrepreneurs to understand their potential destructive side as well.

(T or F) Entrepreneurial cognition is, in part, about understanding how entrepreneurs use simplifying mental models to make assessments, judgments, and decisions about opportunities.

TRUE. Entrepreneurial cognition is about understanding how entrepreneurs use simplifying mental models to piece together previously unconnected information that helps them to identify and invent new products or services, and to assemble the necessary resources to start and grow businesses.

(T or F) There is a certain psychic risk involved with entrepreneurship.

TRUE. Entrepreneurs face a number of different types of risk such as financial risk, career risk, family and social risk, and psychic risk with psychic risk being the greatest risk to the well-being of the entrepreneur.

(T or F) Codes of conduct are becoming more prevalent in industry are proving to be more meaningful, more comprehensive and easier to implement in terms of the administrative procedures used to enforce them.

TRUE. In the broadest sense, ethics provides the basic rules or parameters for conducting any activity in an "acceptable" manner but more specifically, ethics represents a set of principles prescribing a behavioral code that explains what is good and right or bad and wrong; ethics may, in addition, outline moral duty and obligations.

(T or F) New research into the foundation of the entrepreneurial mind-set identifies cognitive adaptability as a person's ability to be dynamic, flexible, and self-regulating in cognitions given dynamic and uncertain task environments.

TRUE. While the research has focused on entrepreneurial cognitions, a new stream of thinking links the foundation of the entrepreneurial mind-set to cognitive adaptability, which can be defined as a person's ability to be dynamic, flexible, and self-regulating in cognitions given dynamic and uncertain task environments.

A decision to sell pharmaceuticals that have not been cleared with the Federal Drug Administration is an example of a(n):

illegal and unethical decision.

When entrepreneurs believe that their accomplishments and setbacks are within their own control and influence, they are exhibiting

internal locus of control.

A decision to sell toys that pass minimum safety standards but can often result in minor accidents to children is an example of a(n):

legal and unethical decision.

Every person has the _____ and _____ to pursue a career as an entrepreneur.

potential; free choice

Which of the following may be the greatest risk to the well-being of the entrepreneur?

psychic risk

Not confronting someone who is cheating on expense accounts is an example of which of the following?

role failure act

The entrepreneurial ego can cause the entrepreneur to

take characteristics that usually lead to success to the extreme.