ENT Midterm Practice Q's

Subchapter S Corporation (S-Corp)

A ________ combines the advantages of a partnership and a C corporation

landing page

A ________ is a single Web page that typically provides direct sales copy, like "click here to buy a Hawaiian vacation."

Mission

A business's ________ statement describes why it exists and what its business model is supposed to accomplish.

inventory

A company's merchandise, raw materials, and products waiting to be sold are called its _______

company description

A company's mission statement should be placed in the ________ section of its business plan.

double taxation

A disadvantage of C corporations is that they are subject to ________, which means that a corporation is taxed on its net income and when the same income is distributed to shareholders in the form of dividends it is taxed again on shareholders' personal income tax returns.

current assets minus its current liabilities

A firm's working capital is its ________.

through social contacts

A network entrepreneur is an individual who identifies his or her business idea

partnership agreement

A(n) ________ details the responsibilities and the ownership shares of the partners involved with an organization

milestone

A(n) ________, in a business plan context, is a noteworthy event in the past or future development of a business

weak

According to research in this area, it is more likely that an entrepreneur will get a new business idea through a ________ -tie relationship than the alternatives.

discuss your general area of interest with a reference librarian

According to the textbook, the best approach to utilizing a library for entrepreneurship-related research is to ________.

ratio analysis

According to the textbook, the most practical way to interpret or make sense of a firm's historical financial statements is through ________

execution intelligence

Alex and Patty Webb launched a firm several years ago and have been particularly successful in introducing new products to the marketplace. One thing that Alex and Patty are particularly good at is translating their thoughts, creativity, and imaginations into products that reach the marketplace. The ability to make this happen is most closely related to which of the following characteristics of successful entrepreneurs?

social force

An increased focus on health and wellness has resulted in a number of new business ideas including healthier foods and beverages, yoga instruction and training centers, and nutrition consulting. An increased focus on health and wellness is an important ________ that is creating opportunities in many areas for entrepreneurial firms.

attractive; timely; durable; and anchored in a product, service, or business that creates or adds value for its buyer or end user

An opportunity has the following four essential qualities: ________.

corporate

Apple is an established firm that encourages and emphasizes entrepreneurial behavior throughout its various divisions. According to the textbook, Apple practices ________ entrepreneurship.

Emerging

Brain Sentry is starting a firm in the small industry that helps football teams discern whether a player has suffered a concussion. This industry is still so new that no standard operating procedures have been developed. The industry Brain Sentry is entering is an example of a(n) ________ industry.

serendipitous

Casey Griggs is a very capable computer engineer. Recently, he noticed a problem that computer engineers have, and thought of a solution to the problem that might represent an opportunity for a new software product. Casey's idea for a new software product is an example of a(n) ________ discovery.

proactive, innovative, and risk taking

Cody Rodgers is the founder of a company named Extreme Sports Apparel. The company makes apparel products for extreme sports enthusiasts such as rock climbers, triathletes, skateboarders, and BMX bikers. Cody wants his company to pursue a high level of corporate entrepreneurship. To achieve that goal, Cody's firm should be ______

salary substitute

Colorado Sandwich, Soup and Salad is a casual dining restaurant that has been owned by Stephanie Peterson for the past 14 years. The restaurant offers a menu that is typical for casual dining restaurants and affords Stephanie a level of income that is similar to what she would earn in a conventional job. According to the textbook, Colorado Sandwich, Soup and Salad is an example of a(n) ________ firm.

C; Subchapter S

Corporations are organized as either ________ corporations or ________ corporations

anthropological

Day-in-the-life research is a type of ________ research.

product/service

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.

burn

For Essentium Materials, the company profiled in the opening feature in Chapter 8, an essential financial metric is to work to grow its monthly revenues faster than its monthly ________ rate

25-35

For most business plans, ________ pages are sufficient

First Mover Advantage

If a startup pioneers an industry or a new concept within an industry, the name recognition the startup establishes may create a formidable nontraditional barrier to entry referred to as a(n) ________.

budgets are a poor tool for financial control

In regard to budgets, which of the following statements is NOT true?

core strategy

In the Barringer/Ireland Business Model Template, ________ describes how the firm plans to compete relative to its competitors.

core competency

In the Barringer/Ireland Business Model Template, a(n) ________ is a specific factor or capability that supports a firm's business model and sets it apart from its rivals.

Joseph Schumpeter

In the book The Theory of Economic Development, ________ argued that entrepreneurs develop new products and technologies that, over time, make current products and technologies obsolete. This process is called "creative destruction".

Financing

In the context of a firm's statement of cash flows, ________ activities include cash raised during the period by borrowing money or selling stock and/or cash used during the period by paying dividends, buying back outstanding stock, or buying back outstanding bonds.

core strategy

Jamie Finch is crafting the business model for her fashion design firm. She just completed the section that describes how her firm plans to compete relative to her rivals. Jamie just completed the ________ portion of her business model template

Determine whether a fitness center for young adults ages 18-30 meets the threshold of being a good idea.

Jessica Smith is thinking about starting a chain of fitness centers for young adults ages 18-30. Which of the following is NOT an appropriate criterion for Jessica to test her idea against?

strong-tie relationships

Most of Sarah's ideas come from interacting with coworkers, friends, her spouse, her parents, and other people that share the same beliefs that she does. Sarah is getting most of her ideas through ________ -tie relationships.

Competitor

Once a firm decides to enter an industry and chooses a market in which to compete, it must gain an understanding of its competitive environment. This challenge can be undertaken by completing a(n) ________ analysis.

competitive recruitment and placement

One of the firms profiled in the Savvy Entrepreneurial Firm feature is The Muse. The Muse is in the ________ industry.

a high proportion of fixed costs relative to their variable costs

Operating leverage is highest in companies that have ________

Declining

Opportunities for leadership, niche, harvest and divestment are associated with ________ industries.

product/service production

Sarah Green, who plans to open a garden and lawn business, is working on the portion of the Barringer/Ireland Business Model template that focuses on how her products and services will be produced. Sarah is working on the ________ section of the template.

product differentation

Some industries, like the athletic shoe industry, are dominated by a small number of firms with strong brands. These industries are difficult to break into without spending heavily on advertising. The barrier to entry that the firms in these types of industries have erected is referred to as ________.

product/customer focus

Stacey Wills, who is at heart a craftsperson, recently started a firm to manufacture a new innovative food blender. Stacey's desire is to sell her food blender to as many people as possible because she firmly believes in the merits of her product. Stacey's story best illustrates which of the following characteristics, or attributes, of a successful entrepreneur?

Candidate a: visionary, energetic, moderate-risk taker

Suppose you are a Small Business Development Center counselor and you're looking at the personality profiles of five potential entrepreneurs. Based on the profiles, which individual has the most desirable mix of personal characteristics to become a successful entrepreneur?

4 and 12

The Barringer/Ireland Business Model Canvas consists of ________ major category(ies) and ________ parts.

Pick a partner that is similar rather than different from you in terms of skills, abilities, and functional background

The Partnering for Success feature in Chapter 3 focuses on the task of finding the right business partner. According to the feature, which of the following is an incorrect rule-of-thumb in finding a business partner?

freelancers

The Partnering for Success feature in Chapter 4 focused on Web-based platforms, including Upwork and Guru, that make it easy to identify and hire experienced ________.

trade associations, trade shows, and trade journals

The Partnering for Success feature in Chapter 5 focuses on three things that are important for startups to become active in to learn the ins and outs of their industries. The three items focused on in the feature are ________.

core competency and key assets

The Resources section of the Barringer/Ireland Business Model Template consists of the ________ and ________ boxes.

an early sample, model, or release of a product that is built to test a concept or a process

The Savvy Entrepreneurial Firm feature in Chapter 3 focuses prototyping. According to the feature, a prototype is ______

36 months to 48 months

The Savvy Entrepreneurial Firm feature in Chapter 7 focuses on the topic of vesting company stock. According to the feature, a typical startup's vesting schedule lasts ________ and includes a 12-month cliff.

a passion for business

The number one characteristic shared by successful entrepreneurs is ________.

Threat of Substitutes

The price of prescription medicine is high, partly because when someone is sick there is no real alternative to buying medicine if they want to get better. Which of Porter's five forces explains how this aspect of the prescription medicine industry helps keep profitability high?

consolidate the industry and establish industry leadership as a result of doing so

The primary opportunity existing for startups in fragmented industries is to _______

desirability and demand

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

a firm's employees and investors; other external stakeholders

The two primary audiences for a business plan are ________ and ________

concept

Tracy Brady is in the process of developing an exciting new product in the smartphone industry. She'd like to show a preliminary description of the product to industry experts and prospective customers to solicit their feedback. Tracy should complete and distribute a(n) ________ statement.

operations plan

What section of the business plan deals with the day-to-day operations of a company?

Sole Proprietorship

Which form of business ownership is a particularly poor choice for an aggressive entrepreneurial firm?

Statement of Cash Flows

Which of the financial statements used by businesses to keep track of their financial affairs is the most similar to an ordinary person's end-of-the month bank statement?

To make the best impression, a business plan should follow an unconventional structure and stand out in some dramatic way

Which of the following is NOT a recommended guideline for writing a business plan?

The liquidity of each partner's investment is low

Which of the following is NOT an advantage of a general partnership?

state and local government officials

Which of the following is NOT an individual, group or institution that normally reads a company's business plan?

channels

Which of the following is NOT one of the four major categories in the Barringer/Ireland Business Model Template?

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

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

It's important to discern whether a particular idea meets the criteria for an opportunity

Which of the following is correct regarding opportunities and ideas?

It's not necessary to complete an actual budget of startup expenses

Which of the following is incorrect regarding the "total startup cash needed" component of financial feasibility analysis?

Common stock is issued more broadly than preferred stock

Which of the following is true regarding common and preferred stock?

Industry Attractiveness

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

The business plan should be written while the feasibility analysis is being completed

Which of the following statements is incorrect about business plans?

Assets are recorded at fair market value rather than cost

Which of the following statements is incorrect regarding how balance sheets are prepared?

Most business licenses and permits can wait until after a business is launched to be obtained

Which of the following statements regarding business licenses and permits is incorrect?

Timeliness

Which of the following was NOT identified as one of the four main financial objectives of a firm

product differentiation

Which of the following was NOT identified in the textbook as a nontraditional barrier to entry?

pessimistic disposition

Which of the following was NOT identified in the textbook as one of the common traits and characteristics of entrepreneurs?

stock options

________ are a special form of incentive compensation. These plans provide employees the option or right to buy a certain number of shares of their company's stock at a stated price over a certain period of time.

Standard

________ business models depict existing plans or recipes firms can use to determine how they will create, deliver, and capture value for their stakeholders.

historical

________ financial statements reflect past performance and are usually prepared on a quarterly and annual basis.

Innovation

________ is the process of creating something new, which is central to the entrepreneurial process.

Feasibility Analysis

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