ECON 125 Modules
How would someone with an entrepreneurial mindset most likely view a downturn in a particular market or industry?
A. A clear signal to stay out of the market. B. A clear need for technological innovation. C. A potential opportunity to innovate. - answer D. An implementation failure on the part of the leading players in that market.
Which of the following best describes a SWOT analysis?
A. A methodology for listening to your customers. B. The most important phase of the entrepreneurial life cycle. C. A tool to help you analyze your competitive advantages and disadvantages. - answer D. Your last chance to differentiate your product.
According to Peter Drucker's work on industry and market structure, in which of the following industries would you be more likely to find opportunities to innovate?
A. A stagnant industry in which the convergence of technologies could fundamentally alter the business model. - answer B. An emerging industry based on technologies currently in early stages of development. C. A mature, low-growth industry.
Which of the following best describes an "elevator pitch'?
A. A twenty-minute presentation about your value proposition aimed at investors. B. A five-minute description of your business model. C. A 20-30 second description of the key attributes of your target customer. D. A 20-30 second description of your value proposition that hooks your listener. - answer
If you are not comfortable setting up and leading meetings with potential customers, what is your best option?
A. Add someone to your team who is comfortable doing these things. - answer B. Skip this part of the entrepreneurial lifecycle. C. Be honest with yourself that you are not meant to be an entrepreneur. D. Contract out this part of the process and ask for detailed minutes from each meeting.
Which of the following scenarios are most likely to result in a successful venture?
A. Adequate financing for your big idea. B. An average idea and a superior management team. - answer C. A great idea and an average management team. D. An average idea and a team that does not work well together.
Which opportunities for innovation represent the least risk?
A. An opportunity that takes many years to implement. B. An opportunity based on a revolutionary technology. C. An opportunity in a market you know very little about. D. An opportunity based upon unexpected success in a market you are already in. - answer
Using Dr. Theodore Levitt's total product analysis, what part of the total product beings to differentiate itself between other products on the market?
A. Augmented product. - answer B. Potential product. C. Expected product. D. Generic product.
When considering your customer segments, you should strive to do which of the following?
A. Avoid bring a low-priced provider. B. Include as many customer segments as possible, regardless of fit. C. Constantly increase your range of offerings so as to appeal to new customer segments. D. Target customer segments that are consistent with your strategy.- answer
The success of Google's search engine demonstrates what about identifying your customers?
A. Customers and users are not always the same. - answer B. Users always benefit more from your product than customers. C. Customers are not always the ones paying for your product. D. The superior product will always win out in the marketplace.
Groupon's use of Wordpress to test its initial idea using a Lean Startup methodology is an example of what?
A. Cutting corners. B. Using an existing channel to launch a minimally viable product. - answer C. A long-term sustainable business model. D. Understanding the difference between a user and a customer.
According to Porter, addressing threat of entry means which of the following?
A. Developing a strategy that makes it difficult for others to compete with you. - answer B. Growing at a faster rate than your competitors. C. Working harder than everyone else who enters the market.
The elements of a successful strategy must do which of the following?
A. Emphasize the importance of some elements over others. B. Evolve to a point that their importance becomes clear. C. Fit with your competitors' views of the market. D. Fit together in ways that reinforce one another. - answer
IKEA has been successful by following what strategy?
A. Enter a crowded market and compete strictly on the basis of lower price. B. Focus on high growth. C. Target select customers who can afford to pay premium prices. D. Develop a defensible position in the furniture market in which few others are able to compete.- answer
The Business Model Canvas is most useful for which of the following?
A. Forming the table of contents for your detailed business plan. B. Helping you identify your big idea. C. Deciding how to implement the activities that comprise your strategy. - answer D. Knowing when it's time to make major changes to your strategic identity.
How is Lean Startup most helpful in developing your big idea?
A. Funding it. B. Marketing it. C. Discovering competition. D. Testing it quickly and inexpensively.- answer
When conducting a SWOT analysis, which of the following would be considered a strength for your big idea?
A. High barriers to market entry for you. B. Many companies already in the market. C. Strong product differentiation. - answer D. Limited bargaining power with suppliers.
Listening to your potential customers means what in the context of the entrepreneurial lifecycle?
A. Identifying your customers and finding out more about their problem. - answer B. Selling them on what you think they need. C. Conducting a random focus group. D. Waiting and watching until the market demands a solution like yours.
Many cultures have historically associated drinking wine with poor health. When the first research studies on the benefits of drinking wine in moderation were published, an entrepreneur would have been most likely to exploit which incongruity?
A. Incongruity between perceived and actual customer values and expectations. B. Incongruity within logic of a process. C. Incongruity between reality and the assumptions about it. - answer D. Incongruity with economic realities.
Which of the following is true about strategic pivoting?
A. It has more to do with developing your big idea than implementing it. - answer B. It is an activity that should increase as your enterprise matures. C. It is central to operational efficiency. D. It is the means of improving the culture of an enterprise.
Teach for America demonstrates what about customer identification?
A. It is difficult to differentiate between customers and users. B. Customers and users are usually the same. C. It is possible to have multiple customer groups. - answer D. Some customers are more important than others.
Which of the following is true about the listening phase of the entrepreneurial lifecycle?
A. It may result in you thinking differently about your idea. - answer B. It's the most passive phase of the lifecycle. C. It represents a one-time fixed cost. D. It applies only to customers.
Which of the following is most likely to result in a sustainable market position?
A. Knowing your customers' needs up front and constructing a solution that makes you different. - answer B. Relying on multiple channel partners to sell your product. C. Effectively identifying your customers as you go. D. Trying to appeal to as many potential customers as possible.
Which of the following sources of innovation is likely to result in the shortest time to market?
A. New knowledge. B. Process need. - answer C. Changes in industry and market structure. D. Demographic changes.
If you wish to retain maximum control over decisions regarding your enterprise, which of the following is likely to be the most appropriate approach to building your team?
A. Offering team members shares of your business in lieu of salary. B. Asking team members to work for free until the new enterprise beings seeing a positive revenue stream. C. Bringing in several team members as partners. D. Paying as many team members as possible as salaried employees from the outset. - answer
The Lean Startup model is an alternative to which of the following?
A. Raising the capital needed to execute your business model. B. Writing a detailed business plan before testing your ideas. - answer C. Executing a pivot at a critical time in the life of your enterprise. D. Flawless execution.
Exploitation of a process need is most likely to be successful when you do which of the following?
A. Rethink the entire process. B. Focus on multiple aspects of a process. C. Identify and focus on a self-contained part of the process. - answer D. Look for solutions that involve cutting-edge technologies.
Peter Drucker's work sheds light on which of the following?
A. Revolutionary changes in a market are a prerequisite for innovation. B. Small changes can result in a major opportunity. - answer C. Changes in a market can be predicted with the right analysis. D. Stability in a market is a prerequisite for doing something new.
What kind of person is likely to be most helpful to you during the listening phase?
A. Someone who is likely to be receptive to your idea. B. Someone with decision-making authority. C. Someone who has a problem that your idea can potentially solve. - answer D. Someone you know personally.
Which of the following is another name for your big idea?
A. Strategic fit. B. Customer segment. C. Business model canvas. D. Value proposition.- answer
How does Lean Startup define the "art of the pivot"?
A. Taking your big idea 180 degrees in the opposite direction. B. Starting from scratch with a new idea. C. Altering a plan based on feedback from inexpensive failure. - answer D. Pausing before you forcefully move forward.
In what respects are a venture capital firm and a grant-making foundation most likely to differ?
A. The importance they assign to measurable results. B. The importance they assign to the quality of your team. C. The importance they assign to your level of experience. D. The nature of their desired return on investment. - answer
The evolution of Amazon Fresh is an example of which of the following?
A. The lack of public interest in fresh food delivery. B. A business totally unrelated to Amazon's consumer goods delivery. C. A lean startup approach with multiple iterations. - answer D. Laser-focus on the initial Amazon business model.
An overriding goal of the strategic planning process is which of the following?
A. To pause before you implement any of your strategic initiatives. B. To get your idea to market as quickly as possible. C. To perform a SWOT analysis. D. To develop a sustainable competitive advantage. - answer
Which of the ideas below is integral to the Lean Startup methodology?
A. Totally addressable market. B. Served addressable market. C. Minimally viable product. - answer D. Maximally viable product.
Pursuing opportunities for growth is always a good strategy.
A. True. B. False. - answer
Why is bargaining power of buyers important to the sustainability of your strategic position?
A. When customers have too much bargaining power they can turn your product into a commodity. B. The larger the number of customers you have, the more bargaining power they have. C. You are more likely to maintain customer loyalty by keeping switching costs low. D. When customers have too much bargaining power they have the potential to undermine your competitive advantage. - answer
When is process need most likely to be a successful source of innovation?
A. When demographic changes are likely to impact the industry. B. When customers are generally happy with the way the process is working. C. When you want to revolutionize the industry. D. When you have deep knowledge of the industry. - answer
Which of the following is true about obtaining money from a venture capital firm?
A. You do not have to worry about ceding any operational control. B. You will have plenty of time to grow your business before the equity firm expects to see a return on its investment. C. The venture firm will be more focused on obtaining a large return on their investment than on recouping their initial investment. - answer D. You will avoid the need for regular board meetings or management reporting.
Dr. Theodore Levitt's model underscores what fact about your potential customers?
A. You must be able to solve the problems of all potential customers in order to be successful. B. A good tomato is a good tomato in the eyes of all customers. C. Customers all have the same problems. D. Customers are not all looking for the same value proposition in your product.- answer
Which of the following is true about failure in entrepreneurship?
A. You only get one chance to become a successful entrepreneur. B. Failure often leads to success. - answer C. As long as you do not have competition, you do not need to worry about failure. D. You should avoid it, since it is always a bad thing.
Spotify's business model demonstrates which of the following?
A. You should only have one customer segment. B. You can address multiple customer segments if they are consistent with your overall strategy. - answer C. You may not have any key partnerships. D. There is room for some extraneous offerings as long as there are enough customer segments.
Which of the following statements about physical spaces are accurate?
A. You will end up spending a significant percentage of your start-up capital on office space. B. Physical space is not really important. C. You never need to worry about impressing a potential customer with office space. D. Money you save on your physical space can go toward growing your business.- answer
Which is not an example of pressure from substitutes? Choose all that are correct. i. Customers opting to use their limited screen time to play video games instead of watch movies. ii. Customers who stop using tobacco products altogether. iii. Customers switching from one brand of soda to another. iv. Customers switching from sugar to an artificial sweetener.
A. i & ii only. B. ii & iv only. C. i & ii & iii only. D. i & iii & iv only. - answer E. All of the above (i & ii & iii & iv).
Which of the following can be important to an entrepreneur's success in exploiting an opportunity to innovate? Choose all that are correct. i. Awareness of change in an industry. ii. The number of competitors interested in the same opportunity. iii. Knowledge of how the industry works. iv. Time it takes to get the innovation to market.
A. i & ii. B. iii & iv. C. i & ii & iii & iv. - answer D. None of the above.
Which of the following characteristics are fundamental to being an entrepreneur? Choose all that are correct. i. Ability to delegate. ii. Managing day-to-day operations. iii. Being comfortable with change. iv. Willingness to take action.
A. i & ii. B. iii & iv. - answer C. i & ii & iii & iv. D. None of the above.
Which of the following are examples of barriers to entry that make it harder for your competitors? Choose all that are correct. i. Securing a more favorable contract than your competitors on parts necessary for your product. ii. Protecting your intellectual property with government patents. iii. Requiring your customers to sign multi-year contracts with you that include a fee for terminating service. iv. Keeping the costs of market entry low for everyone.
A. i & iii only. B. ii & iv only. C. i & ii & iii only. - answer D. i & iii & iv only. E. All of the above (i & ii & iii & iv).
Which of the following are examples of the kind of support you might need while you are trying to get your big idea off the ground? Choose all that are correct. i. Someone with entrepreneurial experience. ii. Someone you can confide in about your concerns when things are not going well. iii. Someone with marketing skills. iv. Someone with whom you can discuss legal issues.
A. i & iii. B. i & ii & iii. C. ii & iii & iv. D. i & ii & iii & iv. - answer
Adding someone with entrepreneurial experience to your team can provide which of the following advantages? Choose all that are correct. i. The option to delegate the most critical decisions about your venture to someone else. ii. Advice on how to avoid, with confidence, making common mistakes. iii. Reduced risk in the minds of potential investors. iv. Connections with others who may directly or indirectly benefit your enterprise.
A. i & iii. B. i & ii & iii. C. ii & iii & iv. - answer D. i & ii & iii & iv.
If you are concerned about maintaining control over the governance of your new venture, which of the following are appropriate sources of financing? Choose all that are correct. i. Loans from friends and family. ii. A second mortgage. iii. Crowd-sourcing. iv. Venture capital.
A. i & iii. B. i & ii & iii. - answer C. ii & iii & iv. D. i & ii & iii & iv.
Which of the following is necessary for creating and keeping a customer? Choose all that are correct. i. Offering something at prices that are perceived as reasonable. ii. Offering something that people need. iii. Offering something that you can produce and deliver. iv. Having a means of informing your customer about your offering.
A. i & iii. B. ii & iv. C. i & ii & iii & iv. - answer D. None of the above.
Which of the following may have a negative impact on the effectiveness of your initial management team? Choose all that are correct. i. Mixing pragmatists and optimists. ii. Rapid growth of the enterprise. iii. Good communication iv. Absence of a clear leader in the group.
A. i & iii. B. ii & iv. - answer C. i & ii & iii. D. i & ii & iii & iv.
Which of the following are valid reasons for wanting to finance as much of your venture as possible yourself? Choose all that are correct. i. You will maximize your ownership in the venture. ii. Your partners are unlikely to want to invest in your venture. iii. Using outside investors will result in ceding them some control of your venture. iv. The cost of capital will never be as low as it is when you are first getting started.
A. i & iii. - answer B. i & ii & iii. C. ii & iii & iv. D. i & ii & iii & iv.
Which of the following is true about revenue forecasting? Choose all that are correct. i. It can help demonstrate to investors when you are likely to begin generating revenue. ii. If done carefully, it can tell you exactly how much money you will need over a 3- to 5-year cycle. iii. It can be a useful planning tool. iv. When starting, you are likely to overestimate the amount of time and money you need.
A. i & iii. - answer B. i & ii & iii. C. ii & iii & iv. D. i & ii & iii & iv.
Which of the following are often part of the typical entrepreneurial experience? Choose all that are correct. i. Failure. ii. Certainty. iii. Willingness to adapt. iv. Ability to build accurate financial models.
A. i & iii. - answer B. ii & iv. C. i & ii & iii. D. i & ii & iii & iv.
Which of the following are examples of the kind of information you want to take from each of your meetings with potential customers? Choose all that are correct. i. Confirmation that you should ask exactly the same questions at the next meeting. ii. Notes on what was said during the meeting. iii. Ideas about other people you might talk to. iv. Customer orders for your product.
A. i & iv. B. ii & iii. - answer C. i & ii & iii & iv. D. None of the above.
Your infrastructure needs will include which of the following? Choose all that are correct. i. Key partnerships. ii. Key activities. iii. Key customer segments. iv. Key resources.
A. ii & iv. B. i & ii & iii. C. i & ii & iv. - answer D. i & ii & iii & iv.
Which of the following is true about the implementation stage of the entrepreneurial life cycle? Choose all that are correct. i. It continues activities begun in earlier stages of the life cycle. ii. Deciding what activities you are not going to perform is as important as deciding what you are going to offer. iii. By the end of this stage you need to be able to articulate a very clear explanation of your big idea. iv. If you've been thorough during the earlier stages of the life cycle, you will not have to revisit any of your assumptions.
A. ii & iv. B. i & ii & iii. - answer C. i & ii & iv. D. i & ii & iii & iv.
Which of the following is true about channel partners? Choose all that are correct. i. They can reduce your overall risk. ii. They have access to a resource or customer segment that you do not. iii. They can deliver something you need more efficiently than you can. iv. They are friends of yours.
A. ii & iv. B. i & ii & iii. - answer C. i & ii & iv. D. i & ii & iii & iv.
Which of the following is true about channel partners? Choose all that are correct. i. The more bargaining power they have with you, the more efficient you can be. ii. They can help you reach customers while you are creating your own in-house channels. iii. They can always do the job of accessing your customers more efficiently than you can. iv. They can help you make your potential customers aware of your value proposition.
A. ii & iv. - answer B. i & ii & iii. C. i & ii & iv. D. i & ii & iii & iv.
