Chapter 1

Along with being properly financed and developing sustainable profit margins, in order to be successful, entrepreneurs must:

develop an effective sales generation model

Economies of scale is the condition that allows the long-run average cost to continue _______ as production _______.

downward; increases

What is the condition that allows the long-run average cost to continue downward as production increases?

economies of scale

Which of the following are ways entrepreneurial businesses can act as catalysts for societal change?

entrepreneurial businesses are willing to pursue smaller market ignored by large corporations and entrepreneurial businesses have an understanding of a local community

According to the text, which of the following is an important driver of the economic success of a community?

new business development

The process of business development from scratch and the process followed by established businesses are ______.

quite different

Which of the following descriptions are characteristics of entrepreneurial firms?

the operation is designed in the image of the founder, the start-up is self funded or closely funded, and the # of employees will not be expected to grow beyond 100.

Which of the following statements is true of venture capital start-ups?

they are often formed as high-tech ventures consisting of unique characteristics

Which of the following are goals of the business plan for a new entrepreneurial business?

to provide investors with necessary information, to provide self-evaluation, and to be a guide to managing the business

Large firms can sometimes do things more efficiently because of their ability to operate on a larger scale than can a small firm. This implies that large firms obtain ______ in some industries.

economies of scale

The business plan for a new entrepreneurial business is developed to serve as a guide to manage the business, to provide potential investors with critical information to evaluate the business, and to:

provide a self-evaluation

Individuals or other organizations that may impact the success of a business and depend on the success of the business for their own livelihood are known as ______.

stakeholders

What are the critical elements that an entrepreneur must solve for success?

sufficient resources to get the business to the point where it is self funding, develop an ability to generate consistent and growing sales, sustainable operating profit margin

The first category of start-up businesses are those formed as high-growth, often high-tech, ventures and are referred to as ______. Multiple choice question.

venture capital-backed firms

Unlike the business plan of a venture capital-backed business, the entrepreneurial business plan is developed as a _____.

guide for the running of the business

Which periodical is published annually and documents the 500 largest corporations by sales in the United States?

fortune

The first category of start-up businesses are those formed as high-growth, often high-tech, ventures and are referred to as ______.

venture capital-backed firms

The European Union considers any business with fewer than _____ employees to be a small business. Multiple choice question.

50

The U.S. government considers any business with fewer than _____ employees to be a small business.

500

stakeholders

Individuals or other organizations that impact the success of a business.

fortune 500

The list published annually by Fortune magazine listing the 500 largest corporations (by sales) in the United States.

Civic leaders often look to ______ as a means to promote economic strength for a community, region, or state.

entrepreneurs

True or false: Every business in the Fortune 500 started out as a large corporation.

false

True or false: Men are the largest single group of new business founders.

false

True or false: Robber barons were responsible for the collapse of small businesses in the 1880s.

false

True or false: Unlike entrepreneurial businesses, large organizations will regularly pursue smaller markets even if they do not believe the results will generate profits.

false

Identify the findings of the federal General Accounting Office's (GAO's) analysis of the impact of the closure of military bases.

in cities with base closings, the areas around the bases had income growth higher than the national average and cities with base closings offered tax breaks and programs to support new business development.

The process of ______ a new business is unique and has developed into a popular area of study at colleges around the globe.

initiating, running, developing

According to the 2019 statistics from the United States Small Business Administration, 99.9 percent of all businesses in the United States are:

small

The World Bank estimates that one of the strongest factors in the growth of any nation's GNP is the presence of entrepreneurial _____ enterprises.

small and medium sized

Identify the guidelines that should be ideally followed by entrepreneurs to create business plans for new entrepreneurial businesses.

An entrepreneur should create an attractive, one-page pitch about the business while developing the business plan.

When was the initial development of the large industrial base of the United States?

1880s

A venture capital-backed business plan typically runs from _____ pages long.

25 to 45

economies of scale

A condition that allows the long-run average cost to continue downward as production increases.

harvest plan

A plan to exit the small business. This typically means to sell the business to another firm or take it to an IPO.

Identify a finding of the federal General Accounting Office's (GAO's) analysis of the impact of the closure of military bases.

In cities with base closings, several new businesses rose up to fill the economic gap that had resulted from the closings.

Which of the following are reasons why entrepreneurial businesses are successful?

fewer layers of management, free to place energy into satisfying the needs of the customer, tend to be more focused than large corporations.

The success of entrepreneurial businesses occurs because they are simply more _____ than their larger corporate counterparts.

focused

Who is associated not only with the success of the industrial base but also with the great abuses in business?

robber barons

the united states small business administration SBA

the agency officially organized in 1953 as a part of the Small Business Act of July 30, 1953, to "aid, counsel, assist and protect, insofar as is possible, the interests of small business concerns." It provides a wealth of information and assistance at all levels of organizational development and management.

Which of the following are characteristics of venture capital-backed firms?

they have a developed organizational structure, they are formed with a harvest plan in place, they either start or grow quickly to employ a relatively large number of employees.

Which of the following statements are true regarding robber barons?

they were responsible for some of the great abuses of business, they dominated the industrial sectors, and they took advantage of the economies of scale

True or false: The one-page pitch created by a new entrepreneur while developing a business plan should offer an effective starting point for every potential supplier, employee, or investor.

true

Which of the following are reasons for the recent growth in the number of women starting new businesses?

greater control over work-life balance and frustration with the glass ceiling

A business plan for a small business typically runs _____ pages long.

from 15 to 25

A difference between entrepreneurial businesses and venture capital-backed firms is that _____.

entrepreneurial businesses' resources are more constrained than those of venture capital-backed businesses

The United States Small Business Administration was organized to:

provide assistance at all levels of management for entrepreneurial businesses, provide information at all levels of organizational development for entrepreneurial businesses, and aid, counsel, and protect the interests of small businesses.

The Fortune 500 is published annually by Fortune magazine and documents the 500 largest corporations (by ______) in the United States?

sales

Large firms can obtain economies of ________ in some industries because of their ability to operate on a larger scale than can a small firm.

scale

In the context of businesses listed in Fortune 500, Henry Ford (Ford Motor Company), Steve Jobs (Apple), Ralph Lauren (fashion), and Sam Walton (Walmart) all started out as _____.

small business owners

_______ include key suppliers, customers, and employees. These individuals are critical to the success of a business.

stakeholders

Silicon Valley and Boston's 128 corridor are well known for:

generating new employment with entrepreneurial ventures, providing a basis to the area's economic vitality, and providing a growing tax revenue base

What program is growing across the United States to help start new entrepreneurial businesses in an area?

economic gardening

According to the World Bank, the presence of entrepreneurial small- and medium-sized enterprises is one of the strongest factors in the growth of any nation's ______.

gross national product