Prin of Entrepreneurship Test 1 - MindTap Questions

The business model includes all of the following components EXCEPT

Business culture

Which stage of the life cycle of an industry has been dubbed the "Wild West" because there are no rules and lots of opportunities?

Emerging

_____ is(are) an excellent way to explore the social culture of customers to gain important insights.

Ethnography

"How big is the market in terms of customers?" is one of the ten critical questions you should ask about an industry.

False

In general, it takes a lot of money to start a business.

False

It's important to take great risk if you want a big reward.

False

In which stage of the life cycle of an industry does intense product differentiation occur and a new venture must identify an unserved market niche?

Differentiation and competition

Starting a business is hard work, so it's better to be young.

False

True or False? A minimum viable product contains all the functionality of a final product; it just doesn't look as finished.

False

True or False? Before you can identify a problem that customers have, you need to have a sense of what your solution might be.

False

_____ serve the same customer needs as your business, but with different resources

Indirect competitors

What are some ways you can innovate with your business model? (Select all that apply.)

- Raise the quality of your product above industry standards - Eliminate something that has traditionally been done in your industry - Find the white spaces in your industry

What kinds of information do you want to collect about an industry you're interested in? (Select all that apply.)

- Whether the industry is growing or not - Where the opportunities are - How quickly the industry adopts new technology - Whether there are high entry barriers or not

A customer matrix is used to: (Select all that apply.)

- segment a large market into smaller markets - understand how to reach a particular customer - determine what type of business you have - determine which customer has the greatest need

You need to segment your market because: (Select all that apply.)

- you can't afford to sell to everyone in the beginning - you have more than one type of customer - it helps you focus on specific customer needs - different types of customers have different needs

Producer Model

A company establishes a formal organization with significant funds and some autonomy

Enabler Model

A company that spreads resoures throughout the organization to encourage entrepreneurship and innovation at all levels

Opportunistic Model

A company that waits for project champions to come forward with new ideas. Then the company decides if it wants to fund those ides

Which of the following statements is true?

Many large businesses have started as home-based businesses

Which stage of the life cycle of an industry requires new innovation to continue growth?

Maturity and decline

A company embeds engineers into a hospital to observe methods. What data collection method does this represent?

Primary research

You conduct a survey of businesses in your industry. What data collection method does this represent?

Primary research

You talk to suppliers and distributors in your industry. What data collection method does this represent?

Primary research

You conduct research through IBISWorld. What data collection method does this represent?

Secondary research

You research and look for patterns on social networking sites. What data collection method does this represent?

Secondary research

Which stage of the life cycle of an industry has the most intense competition?

Shakeout

Which of the following is NOT a critical skill that an entrepreneur needs to acquire to be successful?

The ability to read quickly.

"How much do industry companies spend on R&D?" is one of the ten critical questions you should ask about an industry.

True

"Is the industry growing?" is one of the ten critical questions you should ask about an industry.

True

"Where are the opportunities in this market?" is one of the ten critical questions you should ask about an industry.

True

"Who are the opinion leaders in the industry?" is one of the ten critical questions you should ask about an industry.

True

A need is more important than an idea.

True

Entrepreneurship is a skill that can be taught; you do not need to be born with specific skills to be successful.

True

True or False? In general, you should not outsource both the design and development of your product to the same firm.

True

True or False? Personal interviews are costlier and time consuming than surveys

True

True or False? The prototype doesn't always resemble the final product in appearance.

True

True or False? To validate a customer, you need determine whether you have the right customer and the right solution.

True

True or False? With personal interviews, you gain the benefit of nonverbal communication.

True

Which of the following is NOT an example of product development tradeoffs?

You are building a boating app for an iPhone

No matter which source you consult, the failure rate for new consumer products is:

between 70 and 90 percent

The primary customer for your product is the

one who pays for the product

Because starting any business requires a tremendous amount of time, effort, and resources, it makes sense to:

start a business that has the potential to grow large and give a good return on investment.

What are ways you can segment your market? (Select all that apply.)

- Demographics (age, ethnicity, education, income) - Behaviors - Price - Needs

Why is product design critical? (Select all that apply.)

- Design determines features and performance. - Design determines cost and price - Design determines reliability.

In addition to testing your hypotheses about your business model, when you conduct feasibility analysis, you also want to answer three questions about the success factors for your business. What are they?

- Do the capital requirements to start and operate to a positive cash flow make sense? - Can I put together the right founding team to execute my concept? - . Is there a customer and market of sufficient size to make the concept viable?

According to Porter's Five Forces analysis, which of the following can be characteristics of an attractive industry? (Select all that apply.)

- Few substitutes - Not highly competitive

_____ are businesses that serve the same customer needs with the same types of resources

Direct competitors

True or False? Business models take a long time to develop and should not be changed.

False

True or False? Businesses that do not manufacture products do not need to do prototypes.

False

True or False? It's always best to ask demographics questions first when the respondent is most attentive.

False

True or False? When doing surveys, you must control the selection of respondents.

False

Which stage of the life cycle of an industry is expensive because a company needs to deploy extensive resources?

Growth and adaptation

Amazon took its very successful fulfillment process from books to selling household goods and apparel. What is this an example of?

Taking an existing model into new areas

Advocate Model

a company assigns ownership of a new business creation and provides modest seed funding to test it

Which of the following statements describes a business model? (Select all that apply.)

- A blueprint for running a business - The decisions entrepreneurs make to earn a profit - A means to create and capture value

Which of the following statements ARE entrepreneurial myths? Select all that apply.

- If you're going to be successful, you need a business plan - The more risk you take, the bigger the reward you'll receive - You need a lot of cash to start a business

Which of the following are reasons for business failure? (Select all that apply.)

- Industry architecture - No way to capture value - Technical problems - Lack of resources

Which of the following are reasons entrepreneurs choose the startup process rather than selling a product or service to an existing company? Select all that apply.

- Investment capital is plentiful. - Your opportunity is new to the world - The job market is uncertain

What is the difference between an industry and a market?

An industry is defined by a product or service and a market is defined by customers