Entrepeunership Final
The firm's mission statement:
D. All the responses are correct
_____ is an organization form that treats the firm as a unique entity:
D. Sub chapter C Corporation
A ____ is an agreement between two parties to perform certain activities for some consideration:
A. Contract
_____ demonstrates how a set of activities are dependent upon each other and which activities take the longest time:
A. Critical path chart
A ____ defines companies within a specified geographic radius that will be in direct competition for the same customers:
A. Industry
A company seeks to have inventory present only shortly before it is used: This is called:
A. Just-in-time inventory
_____ is the threat to the success of a new business related to its ability to establish and maintain a high margin product of service:
A. Profit margin
___ are promotions that are strictly financial agreements in which a business pays for some outputs, such as TV advertisements :
A. Pure promotion
A tool to better understand competitors and their capabilities is:
A. competitive map
A small business plan is developed with certain goals in mind, which of the following is not a goal:
A. comprehensive (30 to 45 pages)
An investment in the firm by the owner is called:
A. equity
There are special funds, neither equity nor debt, that do not require repayment and are designed to aid businesses in specific areas:
A. grants
The timing of a new business is a function of all the following except:
A. line of credit
When a corporation suffers loses, the founders will:
A. loose only their investment in the business
A ___ describes estimates by the small business owner of what the balance sheets and income statements will look like in the future:
A. pro forma
The acid test is also commonly kwown as the:
A. quick ratio
A small business owner plays a _____critical role than the senior leadership of a large company
A. more
Debt is a form of ____ financing:
B. non-equity
All of these are advantages for a small business except:
C. Economies of scale
The potential entrepreneur needs to consider ____ when starting a new business:
D. All of the responses are correct
TEST 4: Human resource management include ___ the individual:
D. All of the responses are correct (hiring, inspiring, managing)
The term for when a new business has reached a level where revenue coming into the firm is sufficient to cover expenses:
D. Break-even point
_____ are resources which combine to allow a firm to do things better than its competitors:
D. Capabilities
TEST 2: The first step of an external analysis is to:
D. Determine in which industry the new business will compete
According to a recent study by the National Federation of Independent Businessmen's Foundation, new products ideas for small business start ups originate from all of the following except:
D. Existing records of a business
An entrepreneur can not leave his or her business due to the amount of money that was invested. This is called:
D. Exit barrier
The process of systematically examining the difference between what is expected and what occurs is called:
D. Gap analysis
This is a document that describes the job that is to be filled:
D. Job description
Michael Porter states there are two means to view business strategy:
D. Low cost and differentiation
The new business person should be guided by ____ to develop a critical path chart:
D. Operational data
Pricing something that ends in 9 cents making a big difference in the buying of the product. This is because of a consumers:
D. Perception
The two primary motives for small business owners to start a business are
D. Self-employed and potential for personal rewards
TEST 3: ___ is the simplest form of a business to establish in that the person who owns it and the business itself are treated as the same:
D. Sole proprietorship
A small retail center located along a major road is called a ____
D. Strip shopping center
___ promotions has very limited financial cost, but have time commitment requirements from individuals in the firm:
D. Virtually free
In a partnership it is expected that the founders will contribute to the founding of the firm with:
D. any of the responses could be correct (cash, services, property)
A job offer is finalized by _____
D. candidate signs the offer
When Target buys more ad space in large volume, this is called:
D. economies of scale
Omaha Nebraska offer facilities that house new business and provide resources for them. These are called:
D. incubators
A competitive advantage in business could be ____:
D. All of the responses are correct
___ examines how far the company turns credit sales into cash.
B. Accounts receivable turnover
___ are high net-worth individuals that invest in business not as a business,but as an individual
B. Business angels
Small business resources are more ___ than large firms:
B. Constrained
All of these are sings to identifying a sustainable competitive advantage except:
B. Develop a list of all potential customers
If a small business has employees, the business must have a:
B. Employer Identification Number (E.I.N)
This theory states that we all judge how we are treated relative to how we see others being treated:
B. Equity theory
Glass ceilings in a large corporations involve:
B. Limits to the level of opportunity to the corporate hierarchy.
In forming a new business, the first thing a founder should do is:
B. List their personal skill set
*New business should try to ___ the amount both fixed and total assets in order to conserve cash.
B. Minimize
___ promotion cost something but also has an element of community:
B. Mixed model promotion
____ is a series of ratios along four areas of company performance (liquidity, activity leverage and profitability) that provides a picture of the health of the company.
B. Ratio analysis
All of the following are triggers to start a new business except:
B. Risk Level is intolerable
TEST 1: ______ is the growth engine of the economy:
B. Small business
*As more competitors enter the radius for the business, the radius grows _____:
B. Smaller
___ insurance covers liability for workers who are injured on the job:
B. Workers compensation
A ___ is a summary of the assets and liabilities of the small business
B. balance sheet
This accounting system recognizes expenses as they are paid and recognizes revenues as generated:
B. cash based
James has the benefit of gaining customers loyalty by being the first company to bring out a new gourmet burger. This is a form of:
B. first mover advantage
In the Philo Asian Grille study, during the initial start up period, expenses were _____ than expected
B. higher
The greater the debt the owner is willing to take on a new business the ______ the risk tolerance:
B. higher
A Board of Advisors should have both ___ and ____ to assist the small business owners:
B. insight, experience
When the small business owner is doing job advertising, the company needs to attract the ____ pool of applicants to choose from:
B. largest
*Dennis measures the short term ability of his company to meet its obligation. He would use ____
B. liquidity ratios
A ____ is a contractual agreement where the business receives money that must be repaid over a period of time:
B. loan
Once a small business owner defines the geographic area, the next step is to define the ____ segment of the market that it is seeking to serve.
B. particular
A ___ exists if the service or product performs a similar function:
B. substitute
A small business has _______ formal procedures as compared to a larger firm to operate the company:
B.Few
___ is working with and learning from a company outside of your industry that has a skill that is critical to the firms operation:
C. Benchmarking
____ is a national decision making process that is constrained by our experiences, history, and culture:
C. Bounded rationality
When the small business owner pays an individual a percentage of sales; this is called a ____
C. Commission
A small business determines the cost and then adds some level of profit determined to be appropriate:
C. Cost-plus pricing method
When defining potential customers an owner must:
C. Define a specified radius around the business
In the Rodriguez Family Auto Repair Shop case, Alex realized in order to be competitive against larger firms he needed to:
C. Develop rapport with his customers
___ funds are funds received by a business in exchange for a percentage ownership of the company:
C. Equity
The Fortune 500 companies employ _____ employees than 10 years ago.
C. Fewer
There are two types of partnerships:
C. General, limited
Promotion of a product or service is considered as:
C. Marketing
Fragmented markets have:
C. No clear dominant competitors
_________ occurs in large companies that have excess resources:
C. Organizational slack
A ___ is a claim of intellectual property that covers a specific innovation
C. Patent
A harvest plan in a small business means the owners is:
C. Planning to exit a small business
____ is a useful measure when there is separation between management and ownership in view of performance:
C. Profits
This term means a set amount of compensation for a given time period:
C. Salary
___ is an analysis by the small business owner of the best and worst case scenarios:
C. Sensitivity analysis
Individuals or other organizations that impact the success of a business are called:
C. Stakeholders
Marketing efforts that require little capital are called:
C. bootstrap marketing
A ____ is a listing of each type of activity and each asset within the company.
C. chart of accounts
These ___ costs must be paid no matter how many goods are sold:
C. fixed
In a limited partnership there must be a :
C. general partner
Company analysis should proceed from the___ and move toward the ___
C. general, specific
Hiring a consultant is expensive, but it also _____ the insights that could be obtained:
C. limits
John needs to know who his customers are and how to attract them. He needs a ____:
C. marketing plan
According to the book, the most dangerous situation for a new business is:
C. rapid growth
The largest group of new business owners is:
C. women
*If the current ratio is just over 1.0 it reveals to the company they have just enough money to meet ___ percent of its short term obligations:
D. 100
The cash flow statement is used to describe ___ percent of the activities that provide and use cash during a specified period of time:
D. 100 percent
What percentage of business has a production process:
D. 100%
When completing a conceptual map, an entrepreneur needs to visit _____ potential competitors:
D. 100%
*____ measures the efficiency with which the company can handle its resources:
D. Activity ratio
_____ states the individuals act to maximize their own individual benefit:
D. Agency theory