STS Quiz 2
_____ is the idea and actions that explain how a firm will make its profits. A. Strategy B. Objective C. Mission D. Goal
A
A listed, live connection to a different Web site, which in turn displays a similar link to the first Web site is a(n) A. sponsored link. B. reciprocal link. C. backlink. D. incoming link.
B
A product or service that is kept as a trade secret or is protected legally using patents, trademarks, copyright, or service mark is called a A. tagline. B. proprietary technology. C. pioneering business. D. test marketing.
B
All of the following are advantages of a start-up EXCEPT A. the use of the most up-to-date technologies. B. the access to revolving credit line. C. it can be kept small deliberately to limit the magnitude of possible losses. D. it has a clean slate.
B
All of the following are major concerns of moonlighting EXCEPT A. conflict of interest. B. bootstrapping. C. cannibalizing sales. D. poisoning the well.
B
All of the following concern taglines EXCEPT A. they are a good way to present vision statements, as they are brief and memorable. B. they talk in terms of what will make a difference for the customer or the industry. C. it expresses the fundamental idea or goal of the firm. D. it can serve as the company's vision statement.
B
All of the following relate to "stand retail" EXCEPT A. they tend to be either semi-permanent ones or movable ones. B. they need to be built in places where there is less traffic. C. they can be quickly established. D. they have a problem of building customer base.
B
What is the greatest problem that home-based entrepreneurs face? A. Zoning challenges B. Gaining customers C. Insurance problems D. Delivering work
A
Which are the two major classification systems that code industries? A. NAICS and SIC B. SCALE and SCOPE C. SWOT and VRIO D. SIC and SWOT
A
Which of the following does NOT hold true of part-time self-employment? A. It is a minor portion of all current entrepreneurship. B. There is tremendous volatility as individuals jump in and out of self-employment quickly and frequently. C. It accounts for around half of small businesses in the United States. D. It is the way most people start in entrepreneurship.
A
Which of the following gives the basic overview of a firm and a detailed look at the financials? A. Screening plan B. Operational plan C. Marketing plan D. Investing plan
A
Which of the following refers to the part of a business that is focused on creating new products or services and preparing new technologies, ideas, products or services for the firm's market? A. R&D B. Test marketing C. Preselling D. New entrant business
A
Financial statements, in performing due diligence, should include all of the following EXCEPT a(n) A. balance sheet. B. mission statement analysis. C. income statement. D. statement of cash flows.
B
Tavanna brought with her a franchise business packet. She likes the idea but is unsure what might be its disadvantage? A. It is probably expensive and not profitable. B. You give up control of marketing and operations. C. You compete with the franchise company itself. D. You receive no training and
B
The two key groups outside your business with whom you must deal with as part-time business owners are A. the state and federal governments. B. the government and customers. C. customers and employees. D. employees and investors.
B
If Elizabeth wants to have a full-time sale with only part-time involvement, she should consider A. consignment stores. B. home retailing. C. bootstrapping. D. stand retailing.
A
If Tavanna were to buy an existing business, which of the following disadvantages should you point out? A. Difficulty in determining the worth of the business. B. Possibility of established customers leaving due to change. C. Difficulty in changing existing business processes. D. Buying a business being more expensive than starting one.
A
In _____, executive volunteers contribute their time and energy in assisting start-up and struggling small businesses as a public service. A. mentoring programs B. trade associations C. business incubators D. franchising
A
Nowadays, the conventional wisdom is that if you are serious about starting a business, you ought to start a business full time and prepare for it by A. doing a business plan. B. making bylaws. C. doing a strategic plan. D. creating an organizational chart.
A
The amount of money left after operating expenses are deducted for the business refers to A. net profit. B. gross profit. C. operating profit. D. earnings before tax.
A
The first thing that Amy and her friends need to do to pursue their strategy is to perform A. an industry analysis. B. a SWOT analysis. C. a VRIO analysis. D. a value chain analysis.
A
The key device for managing time for part-time business individuals is A. the to-do list. B. auctioning. C. hiring employees. D. outsourcing.
A
The market refers to the A. total population of people or firms to whom you plan to sell. B. geographic locations where you open business. C. national boundaries where you operate. D. local area where you recruit people for jobs.
A
The second step of the small business strategy planning process is considering with _____ A. customers; benefits. B. competitive advantage; value chain analysis. C. prestrategy; VRIO analysis. D. benefits; industry analysis.
A
There are two circumstances under which creating a business plan is absolutely necessary: (1) _____ and (2) _____. A. when outsiders expect it; for internal understanding B. for government requirement; for investor demands C. for stakeholders; for stockholders D. when family is involved; for friends' information
A
When a small business start-up secures outside investment, one thing it accomplishes is that A. the business is critically examined by outsiders. B. it brings the synergy from multiple founders. C. the business produces a product or service for which there is a proven demand. D. the founders take part in the mentoring program.
A
Which of the following statements about the key considerations for part-time small business start-ups is false? A. You want a low cost of start-up, since you probably will not have a lot of money to invest. B. The more time and energy you spend preparing for a small-scale part-time business, the shorter it takes to make a profit. C. In most cases, the cost to start-up and the time to market are closely related. D. The fundamental idea of permanence is that customers want to know if the firm is likely to be around for awhile, to provide customer service and future sales.
B
Which of the following would you offer Tavanna as an advantage for starting a new business? A. Initial name recognition B. Clean slate C. "Legacy" locations, buildings, and equipment D. Accessibility to experienced managers and workers
B
To avoid having the diversity of values, goals, and motivators from becoming the source of such intrafamily strife, you and the other family business members should respect one another's differences by all of the following ways EXCEPT A. being certain that all family members know and accept that they are not forced to enter the management of the business if they don't want to. B. providing each member of the family business with the opportunity to obtain education and experience outside the business. C. allowing each family member who does wish to enter the business to find out and do those functions and activities that he or she does best. D. assuming that the leadership of the business must come from within the family.
D
"Light a Candle" can be described as A. stand retailing. B. mail ordering. C. home retailing. D. consignment retailing.
A
A _____ is an organization that provides financial, technical, and managerial help to start-up businesses. A. business incubator B. trade association C. venture capital firm D. consultancy
A
A legal agreement that allows a business to be operated using the name and business procedures of another firm is referred to as a A. franchise. B. license. C. turnkey. D. consignment.
A
A one- to two-page overview of the business, its business model, market, expectations, and immediate goals represents a(n) A. executive summary. B. vision statement. C. mission statement. D. elevator pitch.
A
A type of generic strategy aimed at clarifying how one product is unlike another in a mass market refers to _____ strategy. A. differentiation B. cost C. integration D. focus
A
A type of life cycle stage following a boom in which there is a rapid decrease in the number of firms in an industry is the A. shake-out. B. growth stage. C. maturity stage. D. decline stage.
A
A(n) _____ credit is a credit agreement that allows the borrower to pay all or part of the balance at any time; as the loan balance is paid off, it becomes available to be borrowed again. A. revolving B. installment C. social D. nonrevolving credit
A
A(n) _____ is the business term for the population of customers for your products or services. A. market B. industry C. strategy D. SIC
A
All of the following are disadvantages of home retailing EXCEPT A. high cost of getting started. B. always working "on the road." C. lacking a base from which you can organize and work. D. having a highly variable income.
A
Changes in competitors, sales and profits in an industry over time is called A. industry dynamics. B. retrenchment. C. a shake-out. D. a transformational competency.
A
Cost benefits can come from all of the following EXCEPT A. credit. B. scale savings. C. learning. D. organizational practices.
A
Identify the statement that is not essential for an agreement to constitute a franchise. A. The agreement does not require the franchisee to pay a fee for the right to enter into the business. B. The agreement grants the franchisee use of a brand name, trademark, service mark, logo, or other commercial symbol which designates the franchisee as an affiliate of the franchisor. C. The agreement provides that the franchisee may engage in business using a marketing plan or system provided by the franchisor or proposed by the franchisee. D. The agreement provides the franchisee with a legal right to engage in the business of offering, selling, or distributing goods or services.
A
Which of the following refers to funds left over after deducting the cost of goods sold? A. Profit before taxes B. Gross profit C. Net profit D. Rate of profit
B
Which of the following represent the five stages of industry life cycle? A. Introduction, growth, maturity, decline, and death. B. Introduction, pioneers, early adopters, decline, and death. C. Pioneers, growth, early adopters, decline, and death. D. Pioneers, early adaptors, late adopters, early majority, and death.
A
Which of the following would represent Mr. Johnson's interest in Connie's business plan? A. Cash flow and cash cycle B. Growth rate C. Competitive advantage D. Amounts and schedules for returns
A
_____ analysis is based on the concept that the longer you have to wait to receive money, the less valuable it is right now. A. Discounted cash flow B. Replacement value cash flow C. Free cash flow D. Book value cash flow
A
_____ refers to something the business owns that has economic value or is expected to have economic value in the future. A. Asset B. Revolving credit C. Cash flow D. Synergy
A
All of the following are major problems with using book value EXCEPT A. the original cost of an asset might bear no relation to its current value. B. depreciation is an arbitrary, but nonsystematic, method of transferring asset value to expense. C. internally developed assets, such as patents, trademarks, and trade secrets do not have book value. D. Depreciation makes no attempt to measure actual loss of value of an asset.
B
Delegation does NOT make sense in which of the following situations? A. When you want your business to operate in two places at once. B. When trust is low and employees lack skills. C. When you want your business to operate when you are not present. D. When others can do things better than you.
B
Full-time approaches include all of the following EXCEPT A. buying or inheriting existing businesses. B. stand retailing. C. franchising. D. opening a new full-time business.
B
Identify the correct statement about RSS feeds. A. All Web sites push content out to customers by using an RSS feed. B. An RSS feed sends whatever Web material you specify to subscribers to that feed. C. RSS stands for "really simple sequence." D. RSS feeds can be read only with special readers.
B
Identify the correct statement about the 5-M Model. A. It is typical to have multiple measures, and they are typically given in qualitative form. B. Mission statements give the firm's major business goal, which can be stated quantitatively or qualitatively, but always with a time period. C. Methods typically involve identifying quantitatively stated strategic achievements which would prove you have done what you set out to do as a business. D. Mechanics are generally given as one-paragraph project descriptions.
B
If Elizabeth starts to take days off from work to staff the kiosk at the flea market, she may be facing A. bootstrapping. B. conflict of interests. C. poisoning the well. D. aggrandizing.
B
In SWOT, strengths are A. chances to make greater sales or profits in the environment. B. characteristics of the business that give it an advantage over others in the industry. C. elements in the environment that could cause trouble for the business. D. characteristics that place the firm at a disadvantage relative to others.
B
Most small businesses are more _____ than _____. A. cost-directed; profit-directed B. imitative; innovative C. customer-driven; employee-driven D. innovative; imitative
B
The first step of the small business strategy planning process A. involves performing a SWOT. B. involves reviewing and confirming the prestrategy decisions that define your firm and your goal for it. C. is where you consider your customers and the benefits you want to offer them. D. is to study the dynamics and trends of your industry.
B
The single greatest hurdle to a successful start-up is A. obtaining and maintaining mentoring relationships. B. obtaining and maintaining sufficient cash. C. hiring and retaining qualified employees. D. procuring enough inventory for sale.
B
Using the degree of similarity, Amy's concept of laundromat with a workout space can be described as A. parallel competition. B. incremental innovation. C. cloning. D. mass differentiation.
B
Which of the following financial statements is NOT expected in the business plan? A. Income statement B. SEC filing statement C. Balance sheet D. Cash flow statement
B
Which of the following is NOT a path to full-time business ownership? A. Franchising B. Stand retailing C. Starting a new business D. Buying an existing business
B
Which of the following is an advantage of buying an existing business? A. It is easy to find an appropriate existing business for sale given the technology today. B. Purchasing a business often requires less cash outlay than for creating a start-up. C. Existing managers and employees embrace change due to continuing operations that provide job security. D. New technology needs are eliminated.
B
Which of the following refers to the particular way a firm implements customer benefits that keeps the firm ahead of other firms in the market? A. Industry analysis B. Competitive advantage C. Resource distribution D. Value chain
B
Which of the following represents a business plan concern of silent partners/angel investors? A. Competitive advantage B. Growth rate C. Asset/collateral base D. Benefit
B
_____ are rules of thumb that are commonly used to estimate firm value in relation to some easily observable characteristic of the business. A. Synergies B. Spin-offs C. Book values D. Heuristics
D
All of the following are key things an influential person looks for in your business plan presentation EXCEPT A. your passion for the business. B. your expertise about the business and the plan. C. how many others are already working with you? D. how easy it would be to work with you.
C
An opportunity that makes it possible for a new business to gain a foothold in a market refers to A. parallel competition. B. incremental innovation. C. entry wedge. D. altruism.
C
Contracting with people or companies outside your business to do work for your business refers to A. moonlighting. B. bootstrapping. C. outsourcing. D. licensing.
C
Given that Tavanna has no inheritance possibility, all of the following are other options you could offer her for full-time business EXCEPT A. buying a business. B. franchising. C. consignment business. D. starting a new business.
C
In which way will working with a partner reduce the risk of a start-up? A. Banks prefer partnered start-ups. B. Federal government provides subsidies to partnering situations. C. Partners may provide capital, equipment, or advice. D. Partners eliminate the need to hire other employees.
C
Permission from a government organization to act differently than the laws state is known as A. a covenant. B. volatility. C. variance. D. bootstrapping.
C
Purchases of existing businesses may occur through _____ in which the business is bought over a period of time with money earned from the business. A. turnkey B. cash purchases C. earn-outs D. leveraged buyouts
C
The fourth step of the small business strategy planning process A. is where you consider your customers and the benefits you want to offer them. B. aims to refine your firm's capabilities in order to maintain a competitive advantage. C. involves determining the best strategic direction and strategy for the firm. D. is to study the dynamics and trends of your industry.
C
What is the goal of appendixes? A. To inform customers and partners about the firm and the product. B. To establish an ongoing relationship with the listener. C. To provide supporting information that helps detail the key selling points of your plan. D. To sell customers and investors on the idea of the business and their need for it.
C
What types of customers are likely to generate more potential customers than any other type? A. Loyal customers B. Local customers C. Passionate customers D. Corporate customers
C
When performing a SWOT analysis, where Amy's business threats meet her business weaknesses, what should her strategy option be? A. Fix B. Fight C. Flee D. Flaunt
C
Which of the following is a disadvantage of a start-up? A. It begins with a clean slate B. Absence of "legacy" locations, buildings, and equipment C. Absence of initial name recognition D. Providing new products or services
C
Which of the following statements about a business plan is false? A. A business plan enables you to look at every aspect of your business. B. Business plans are important if you intend to ask others for expertise or financial investments. C. Estimates suggest that a business plan may take anywhere from 10 to 20 hours or more if you are new to business. D. If you are new to business and need to gain basic experience, you might want to obtain other types of experience before writing a business plan.
C
_____ refers to information provided to the government concerning the existence of, name of, nature of, and contact information for your business. A. Zoning B. Franchising C. Registration D. Bootstrapping
C
_____ refers to the size of the market whereas _____ refers to its geographic range. A. Scope; scale B. Mass; niche C. Scale; scope D. Niche; mass
C
_____ represents a business plan concern of joint venture partners. A. Amounts and schedules of returns B. Cash flow and cash cycle C. Intellectual property protection D. Stability of firm
C
A good marketing strategy focuses on all of the following ideas EXCEPT A. the overall strategy your firm pursues in the market. B. the sales plan. C. the long-term competitive plan. D. harvesting the business plan.
D
A research process that provides the entrepreneur with key information about the industry, such as its current situation and trends is called A. SWOT analysis. B. VRIO analysis. C. value chain analysis. D. industry analysis.
D
All of the following are challenges of being a part-time entrepreneur EXCEPT A. delegation and outsourcing. B. ethical challenges. C. moving from part-time to full-time entrepreneur. D. the ability to make money to sustain the business.
D
All of the following are situations in which it might make better sense to undertake a part-time business EXCEPT A. when you are new to business and need to gain basic experience. B. when you lack resources to pursue a full-scale business. C. when there is a narrow window of opportunity. D. when there is enough time and resources to get the entire business going.
D
An Internet site designed to introduce and explain a business to others is known as a(n) A. e-commerce Web site. B. portal Web site. C. advocacy Web site. D. informational Web site.
D
An overall strategic approach in which a firm seeks to do something that is very different from that of what others in the industry are doing is called a(n) A. cost-leadership strategy. B. imitative strategy. C. grand strategy. D. innovative strategy.
D
Based on what you have learned from this class, which of the following should Tavanna NOT do to increase her chance of start-up success? A. Getting a mentor B. Securing outside investment C. Building trust in her "story" D. Starting her business without any other founders to avoid conflict
D
Identify the correct statement about B2B. A. For most of us, the B2B market is visible. B. An example of a B2B transaction would be an individual buying a cell phone. C. It involves electronically-facilitated transactions between consumers through a third party. D. B2B e-commerce is larger than B2C e-commerce.
D
Identify the statement that is not a part of the steps which make up the process of due diligence. A. Conducting extensive interviews with the sellers of the business. B. Making a personal examination of the site (or sites) of the business. C. Interviewing customers and suppliers of the business. D. Developing a brief business plan for the acquisition.
D
Identify the two market decisions that Amy and her friends need to make. A. Imitation and innovation B. Local or global C. Mass or niche D. Scale and scope
D
If Connie gets her family and friends involved as investors, which of the following would be their concern or interest? A. Cash flow and cash cycle B. Growth rate C. Competitive advantage D. Amounts and schedules for returns
D
The classic business plan contains _____ pages that include financials and appendixes. A. 15 B. 25 C. 60 D. 40
D
The length of an executive summary should be A. 20-50 words. B. 60-100 words. C. 5-10 words. D. 250-500 words.
D
The ratio of the value of a firm to its annual earnings is called A. un-appropriated profit. B. accumulated earnings. C. retained earnings. D. the earnings multiple.
D
The specific concept that leads to a start-up business usually comes from the _____ of the person starting the business. A. credentials B. interests C. education D. experience
D
The tool appropriate for the third step of the small business strategy process to study the dynamics and trends of your industry is the A. value chain analysis. B. SWOT analysis. C. VRIO analysis. D. industry analysis.
D
Value benefits can include all of the following EXCEPT A. quality. B. style. C. delivery. D. learning.
D
Which of the following is NOT a business plan concern of bankers? A. Cash flow and cash cycle B. Asset/collateral base C. Long-term prospects D. Monitoring compliance
D
Which of the following is NOT an advantage of home businesses? A. Speed and ease of setting up. B. Low cost of getting started. C. Ability to do the work away from your home and employer. D. Always working "on the road" thereby enhancing productivity.
D
Which of the following is a disadvantage of purchasing an existing business? A. Established customers leaving due to change. B. Existing business processes being difficult to change. C. Purchasing a business being significantly more expensive than a start-up. D. Existing managers and employees resisting change.
D
Which of the following statements about asset valuation methods is false? A. Estimates do not consider the value of an ongoing firm over the value of its identifiable assets. B. They are based on the assumption that a business is worth the value of its assets minus the value of any liabilities. C. It is very difficult and time consuming to separately identify and estimate the values of all the assets of a business. D. The application of asset valuation methods to business valuation is similar to having an annuity.
D