Organizational Management Chapter 6

When advertisers pay a website operator to access the demographic group that visits the site, they are using the__________ support e-commerce model.

Advertising

Sites such as Zazzle.com, which pay commissions to other sites to bring business to them, are using the __________ model for e-commerce

Affiliate

Which of the following describe typical features of a business incubator?

Associated with universities Offers shared costs Located in an industrial park

Which of the following are typical ways entrepreneurs can exploit opportunities?

By exploring domains that are avoided by large companies By introducing goods or services that capture the market because they are simpler, cheaper, more accessible, or more convenient

In the creation of a new business, people's judgment of which of the following characteristics of the company make up its legitimacy?

Desirability Appropriateness Acceptance

A business plan is an opportunity for entrepreneurs to do which of the following?

Determine ways to reduce risk and maximize rewards. Convince others that the entrepreneur understands the process of starting a business.

True or false: As a business grows, entrepreneurs often quickly delegate work they have been doing.

False

True or false: The only essential step for building support for a project idea within a company is to get the support of higher level officials.

False

One of the key planning factors that entrepreneurs must think through carefully in creating a business plan is risk and

reward

Among its various benefits, the value of a plan is that it helps the entrepreneur reduce___________ and maximize__________

risk reward

Which of the following are reasons entrepreneurs fail to use formal controls?

They have an aversion to record keeping. They are busy.

What are some of the characteristics of people who become successful entrepreneurs?

They understand and have skills in management, business, and networking.

Which of the following are purposes for creating a business plan?

To determine the viability of an enterprise To guide the planning and organizing To assist in obtaining financing

Which of the following are reasons that entrepreneurial businesses go public by using IPOs?

To pursue otherwise unaffordable opportunities To improve credibility with customers To reduce debt To raise more capital

The e-commerce business model in which a website is paid by companies that promote their goods or services on the website is the ______ model.

advertising support

A group of people with business experience who can help guide an entrepreneur is called a(n) ______.

advisory board

The e-commerce business model in which an organization drives business to its own site by paying commission to other sites is known as the ______ model.

affilliate

A group of people who are willing to provide business insights and professional connections are known as

an advisory board.

Entrepreneurs can find opportunities by entering domains big companies avoid and introducing products that are ______.

cheaper

The difference between the transaction fee model and the intermediary model of e-commerce is that the transaction fee model charges a fee ______, whereas the intermediary model charges a fee ______.

for goods and services; to bring buyers and sellers together

An entrepreneurial alliance between an innovator who created at least one successful store and wants to grow the business and a partner who manages a new store of the same type in a new location is called a(n) ______.

franchise

A great product, a viable market, and ______ are essential ingredients to entrepreneurial success.

good timing

When contemplating a business, an entrepreneur must start with a good ______.

idea

A(n) ______ is when a company wants to raise capital through federally registered and underwritten sales of shares in the company.

initial public offering

The first-time sale of federally registered and underwritten shares of company stock to the public is called a(n) ______.

initial public offering

An important model for characterizing new ventures is by their levels of ______.

innovation and risk

In a franchise agreement, the franchisor is the ______ and the franchisee is the ______.

innovator; operator

Business incubators are often associated with a(n)

university.

In general, successful entrepreneurs have good knowledge and skills in which of the following?

Business Management Networking

Which of the following are elements of social capital?

Being part of a network of people Having a good reputation

Which of the following are characteristics of an entrepreneurial personality?

Commitment and determination Motivation to excel Leadership

Which of the following are specific key planning factors, in addition to financial elements, that entrepreneurs must think through carefully?

Context People Competition

Which of the following are factors that influence the success or failure of business start-ups?

Economic environment Management-related challenges

Which of the following statements is true about the early stages of an entrepreneurial venture?

Entrepreneurs are unable to specialize.

Which of the following could explain why entrepreneurs fail to use their resources wisely?

Entrepreneurs fail to maintain control over their resources. Start-up capital is used on expensive locations.

Which of the following statements about the failure of new start-ups is true?

Estimates of failure rates indicate that more start-ups fail than succeed.

What does the entrepreneurial strategy matrix do?

Helps entrepreneurs decide on a preferred level of risk and innovation Helps identify effective and ineffective strategies Helps entrepreneurs decide if their ventures suit their objectives

______ is the offer of payoffs from the project in return for support, time, money, and other resources.

Horse trading

Which of the following statements about IPOs is true?

IPOs are federally registered.

Which of the following are favorable factors in increasing entrepreneurial activity?

Increases in the money supply Improving performance of the stock market Real economic growth

Which of the following is NOT a factor that influences the success or failure of a new venture/business start-up?

Institutional corruption

Which of the following are reasons that growth creates challenges for entrepreneurs?

Limits to founders' capacities Increasing expenses Competing with bigger firms

Which of the following are recommended practices for helping ensure the survival of a family-managed business?

Make sure that family members in the business work as hard as other employees. Someone outside the family and the business should help plan succession. Have at least one key position be filled by a nonfamily member.

What are high-potential future opportunities for entrepreneurship?

Nanotechnology Cryptocurrency Green energy

Which of the following are reasons that survival may be difficult for a small startup company?

No track record Difficulty finding lenders Lack of customers

Which entrepreneurial trait involves an intimate knowledge of customers' needs and the desire to create value?

Opportunity obsession

Which of the following are benefits that business partners can serve?

Spreading the workload Accessing capital Sharing expertise

Which of the following are the tendencies that determine entrepreneurial orientation?

Taking risks Allowing independent action Being proactive Being competitively aggressive

Which of the following are factors that typically motivate entrepreneurs as they start a business?

The challenges of the business The potential for profit The sense of satisfaction the business generates

What is the role of the economic environment on the success of entrepreneurial ventures?

The economic environment affects the success of entrepreneurial ventures by affecting the supply of capital and prospective opportunities.

Which of the following is a crucial nonfinancial resource?

The top management team

Which of the following exacerbates the problem of entrepreneurs failing to use their resources wisely?

Venture capital funding

Survival for small start-up companies may be difficult because of ______.

a specialized market and strong competition

Informal work on a project that is of an employee's own choosing and not officially assigned is called ______.

bootlegging

A formal planning step that focuses on the entire venture and describes all the elements involved in starting it is called a(n) ______.

business plan

Entrepreneurs often hesitate to , __________ work to others as their business grows.

delegate

Entrepreneurs often have to ______.

do more than one business function

The tendency of an organization to identify and capitalize successfully on opportunities to launch new ventures by entering new or established markets with new or existing goods or services is called ______.

entrepreneurial orientation

Independence, profit potential and a better quality of life are reasons individuals become ______.

entrepreneurs

The e-commerce business model based on charging a commission for bringing buyers and sellers together is the ______ model.

intermediary

People's judgment of a company's desirability stemming from company goals and methods that are consistent with societal values is called ______.

legitimacy

In the model that conceptualizes entrepreneurial ventures according to their relative levels of innovation and risk, most small business ventures are categorized as ______.

low in innovation and high in risk

The two major liabilities of start-up companies are ______.

newness and smallness

The entrepreneurial strategy matrix helps entrepreneurs think about their venture and whether it suits their

objectives.

An analysis that includes a description of the good or service, an assessment of the entrepreneur, and a specification of activities and resources needed to translate the idea into a viable business and sources of capital is called a(n) ______.

opportunity analysis

The first formal step in creating a business plan that includes a description of a good or a service and other assessments is a(n) ______.

opportunity analysis

The most dangerous risk in intrapreneurship is the risk of ______.

overreliance on a single project

Two people who go into business together are called ______.

partners

One long-term measure of an entrepreneur's success related to the mortality of the founder is ______.

planning for succession

Entrepreneurs facing growth are challenged by competition from bigger firms, funding issues, and ______.

plans for international expansion

Entrepreneurs fail to use formal controls because they are busy and have ______.

poor record keeping practices

An important factor affecting the success of intrapreneurship is ______.

scale

The __________ street effect occurs when an entrepreneurial opportunity is discovered unexpectedly while pursuing another opportunity.

side

When entrepreneurs start their enterprises and then capitalize on an unexpected opportunity it is called the ______.

side street effect

Project teams that produce a new product within a predetermined time frame and without fear of losing their job if the new product fails are called

skunkworks

A lasting source of competitive advantage for an entrepreneur that involves building relationships and networking with people is ___________ capital

social

Traditionally driven by the government and big defense contractors, ______ represents a potential future opportunity for entrepreneurs.

the outer space market

Nonfinancial resources that are important to the success of a new business are business legitimacy, networks, advisory boards, and the __________ management team.

top

When Amazon.com and online travel agents charge a fee for goods or services, they are using the ___________ fee model of e-commerce

transaction

The e-commerce business model in which a company charges for goods or services is the ______ model.

transaction fee