busi chapter 5

the franchisee supplies

labor and capital, and owns and operates the outlet

what is the primary reason that so many new businesses fail?

mismanagement resulting from lack of business know-how

As a businessperson planning to open a new small business, you know that the business plan should not contain

pages and pages of detailed facts and figures

the following statement answers which major question that a business plan should address? this business will serve over 200 customers by the end of the year and employ seven full time employees

what are the goals for the business?

this business will create a caring learning environment for elementary school children after regular school hours to meet the needs of working parents this statement answers which of the following issues that should be addressed in a business plan

what is the nature and mission of the business

all of the following are advantages to the franchisor except

fast and selective distribution of products

a franchisor supplies all of the following except

Land to place the business on

Which form of franchising is the most common today?

a franchisor supplies brand names, techniques, or other services instead of a complete product.

imagine that you want to open your own small business you will probably be most concerned with having

a good source of capital and good management skills

Before seeking financial backing for his new business, Tyler puts together a concise document explaining the nature, mission, and goals of his new business and its expected costs and potential. Tyler has constructed a(n)

business plan

janis starts a small quilting and embroidery business she purchases a technologically advanced quilting machine and an embroidery machine for a combined 25,000 her monthly payments on the equipment are 500 but she only has one client at this time janis is facing a potential

cash flow problem

a new small business underwater wildlife has opened to sell tours of underwater sites around the country and in south america however money has to be paid upfront by the underwater staff to book hotels and other travel arrangements before its clients have paid for the tours that means underwater is facing potential

cash-flow problem

which of the following would least likely be started as a small business?

electricity company

Many small firms seek to establish a particular niche in the market, realizing that they cannot afford to operate on a larger scale without exposing themselves to considerable risk of retaliation from larger companies. When a number of small businesses are operating in this manner, they are forcing the larger businesses to recognize and account for their influence on the market. In this way, small businesses are primarily

fostering competition

you have decided to open a pet store and have engaged in a contract with dog n cat centers inc. you and the company have drawn up an agreement that allows you to use the company's name and its proven method of doing business to receive training and to use its advertising materials in this agreement dog n cat is the _______ and you are the _________

franchisor; franchisee

all of the following are advantages that small businesses have except

greater potential for making profit

all of the following are reasons people go into business except the

guaranteed return on investment

Cindy compiles a business plan for a business she hopes to start. This plan should answer all of the following questions except

how often will the business have a sale

Mary's cleaning business has several customers but is not dominant in its field. This is an example of a(n) ____ business.

small

which of the following statements is not true about small businesses

small businesses create cyclical unemployment

all of the following are disadvantages to the franchisee except

starting a business with limited capital

the fact that insulin and power steering both originated with individual inventors and small companies is testimony to the power of small businesses as providers of

technical innovation

Tim owns a McDonald's franchise that is having some troubles. Where is Tim most likely to go for advice and guidance?

the franchisor

Steven Jobs and David Wozniak, the founders of Apple Computer, Inc., are creative, free-spirited individuals who decided that being corporate underlings was not what they wanted from a career. They had an innovative idea for a product and desired to create their own business based on this idea. All of the following are factors that could have led them to go into business except

the low risk and high rewards inherent in entrepreneurship

small business are typically managed by

the people who start and own them