Chapter 6
Which of the following statements is characteristics of entrepreneurs?
C: They look at problems and see opportunities
Which of the following statements accurately depicts an advantage that small business has over big business?
A small business can maneuver and change quicker than most large businesses can. It can react to market conditions and customer concerns much faster.
Which of the following will not help your small business succeed?
A: Services you perform are easily replicated by larger companies, such as online banking
Which of the following government agencies is responsible for encouraging the development of small business?
A: Small Business Administration
Which of the following best describes entrepreneurial personality traits?
A: Tolerant of uncertainty and highly energetic.
The business plan will include ____________.
A: an analysis of the competition
A ________ refers to people with unsatisfied wants and needs who are willing and able to buy a product or service.
A: market
Bankers and potential investors are likely to read ___________ first.
A: the executive summary
Intrapreneurs make use of __________ to develop and launch new products and generate new profits.
A: their employer's existing human, financial, and physical resources
________ are private individuals who invest their own money in potentially hot new companies before these firms become larger, publicly traded companies.
B: Angel Investors
Which of the following explains why individuals accept the risk of business ownership?
B: The sense of self-satisfaction and independence
One reason we have seen continued growth in home-based businesses is:
B: affordable computer and information technology makes it easier to compete.
Enterprise zones are specifics geographic areas that:
B: attract business investment by offering lower taxes and government support for development.
For prospective entrepreneurs, enrolling in an Introduction to Business or Small Business Management course offered through their community college:
B: can be helpful by offering them an opportunity to meet experienced small business owners.
Kyra recently quit a job with a large corporation to start her own business. While she realizes that her decision comes with risk, she is excited at the chance to be independent and by the challenges of running her own firm. Kyra is an example of a(n):
B: entrepreneur
Entrepreneurs applying for a bank loan should realize that bankers will:
B: expect the entrepreneur to provide a business plan.
An entrepreneurial team consists of:
B: experienced professionals from different areas of business
A business's size is measured:
B: in relation to other firms in its industry
State and city governemnts have promoted facilities where new businesses can open up shop and share common services such as secretarial, accounting, and legal services. Due to their remarkable success rate, ________ continue to grow in popularity.
B: incubators
The Small Business Administration defines a small business as a firm that:
B: is independently owned but not dominant in its industry
According to SBA guidelines, a manufacturing firm with 1,000 employees:
B: may be classified as a small business depending upon the size of other firms in the industry.
Business incubators are usually government-funded facilities intended to:
B: offer startup firms low-cost office space and basic business services.
Two key management functions that need particular attention when starting a business are:
B: planning and financing
Jayne started a small bakery in a resort town. She was certain she had the ideal location, with plenty of hotels and inns within walking distance of her establishment. She planned to use her grandmother's recipes, using only the finest ingredients for her upscale resort customers. During the first week of business, she was disappointed with lackluster sales. When she drove past the regular breakfast-style restaurants and even the Starbucks, she noticed they were rather bustling. Jayne most likely:
B: underestimated the competition
Small businesses create about ________ percent of the new jobs in the Untied States.
C: 65
Which of the following in not a reason stated for small business failure?
C: Buying too little on credit and not being lenient enough with your credit paying customers
Which of the following best describes the difference between an intrapreneur and an entrepreneur?
C: Intrapreneurs work within existing corporations while entrepreneurs assume the risks of starting their own business
Small businesses must seek advice from outside experts. In order to put together official documents such as leases, contracts, and partnership agreements, it is important to seek the advice of __________.
C: an attorney
A _________ is a written document that details the business idea, the target market and the business's competitive advantage, financial resources available for the business, and the qualification of the management.
C: business plan
One of the challenges of running a home-based business is:
C: keeping work and family tasks separate.
When starting a small business, it's important to remember:
C: learning from others and gaining relevant business experience improves the odds for success.
Pete inherited a thriving dry cleaning business from his father and mother. He continued the tradition of offering quality service to the customers he served. As the surrounding towns expanded, several people suggested that Pete expand the business to offer service in new locations. He chose to maintain only one operation, so as not to lose control and to keep his work life and home life balanced.
C: micropreneur
Business owners who prefer to maintain their businesses at a manageable size are called:
C: micropreneurs
A market consists of potential buyers of a good or service. However, for a market to exist:
C: people must have unsatisfied wants and needs as well as a willingness and ability to buy.
When comparing small businesses to their larger competitors, it is clear that:
C: small firms often can offer more personalized customer services than big firms.
Entrepreneurship is:
D: accepting the risk of starting and running a business.
A successful web-based strategy that helps a business spread the word about its website and products is called:
D: affiliate marketing
Successful entrepreneurs are self-nurturing. This means they:
D: believe in themselves and their ideas.
After personal savings, the next largest source of capital for entrepreneurs is from:
D: friends and family
Yesterday, on Facebook, one of Sarah's friends suggested that she spread the word about Mia Bella Boutique, an online company that designs hats and shoes. If Sarah's efforts generate 25 more people to spread the word, Sarah will receive 30% off her order. Mia Bella is utilizing _____________, an effective strategy for increasing awareness and market share for web-based businesses.
D: guerilla marketing
A creative person working within a corporation to launch new products and generate new profits is known as an:
D: intrapreneur
Southwest College received a government grant to establish a business incubator. This facility will offer:
D: new businesses low-cost office space with basic business services.
Affiliate marketing is a web-based strategy that:
D: rewards individuals who are willing to link a company's website to their blog or social network.
The Small Business Administration sponsors volunteers from industry, trade associations, and education who offer advice to small business owners. These volunteers are called:
D: the Service Corps of Retired Executives.
Successful small business owners are:
D: valuable sources for information since you can learn from their experiences.
A firm or individual providing financial capital to small businesses in exchange for an ownership stake in the company is called a(n):
D: venture capitalist
One way to get into business is to buy an existing company. The value of the business used to determine a fair purchase price is based on:
the value of what the business owns, what it earns, and what makes it unique.
