Exam 2: Chapters 7-12
A firm's internal environment contains elements that can impact the firm but are generally beyond its direct control
False
A positive aspect of a small business is that it takes very little management skill because it is small.
False
Direct Small Business Administration (SBA) loans are made from funds set aside each year by congress
False
Due to their size large businesses tend to have greater flexibility than small businesses
False
Entrepreneurial activities are not influenced by changes in the external environment
False
Entrepreneurs, as a general group, dislike risk taking.
False
Established small businesses are defined as companies that have been in business at lease fifteen years and employ between 50 to 500 employees.
False
In PESTEL, factors are characterized as opportunities or threats
False
In the context of Porter's model, a substitute is the similar products like rivals
False
In the past few years, the federal government has cut back burdensome government regulations and paperwork to the point that they are almost non-existent for small business owners
False
Internal factors are things in the global environment that may impact a firm's operations or success, examples are a rise in interest rates, or a natural disaster
False
It is not advisable for small businesses to use the services of CPAs and lawyers because most businesses are too small to afford the expense
False
Minorities are not interested in becoming entrepreneurs
False
Multipreneurs are businesspeople who have tried a succession of entrepreneurial start-ups without finding an area in which they could be successful.
False
Rivalry is weakest within a strategic group, and the actions of one firm in a group generally does not elicit responses from other group members, as market share in the industry is rarely affected
False
Strong rivalry in an industry increases the profit potential for all firms because consumers have many firms from which to purchase products or services and can make at least part of their purchasing decisions based on prices
False
Support activities, according to the value chain, are the actions a firm takes to directly provide a product or service to customers
False
The first step in starting your own business is the creation of a unique marketable idea
False
The two sources for debt financing are angel investors and venture capitalists
False
Threats offer positive potential, however sometimes a firm is not equipped to take advantage of them which is why considering the entire SWOT is important before deciding what to do
False
Unlike large corporations, sole proprietorships do not need a business plan
False
A firm's resources and capacities are the unique skills and assets it possesses
True
A firm's strategic position should try to be unique in some way that competitors cannot imitate quickly or easily
True
A firms weaknesses are simply gaps in capabilities, and those gaps do not always have to be filled withing the firm
True
An advantage of a small manufacturer over a large manufacturer is the speed with which new products can be introduced to the marketplace
True
An entrepreneur is a person who opens and manages his or her own business.
True
Demographics includes facts about income, education levels, age groups, and the ethnic and racial composition of a population
True
Entrepreneurs are people with vision, drive, and creativity, who are willing to take the risk of starting and managing a business to make profit.
True
Entrepreneurs typically are innovators who start companies to pursue their ideas for a new product or service.
True
Firms in an industry may or may not compete directly against one another, as we'll discuss shortly, but they all face similar situations in terms of customer interests, supplier relations, and industry growth or decline
True
Inadequate early planning is often at the core of small business failures
True
Many small businesses that sell their products internationally use the services of export management companies (EMCs)
True
Micropreneurs are entrepreneurs who start small and plan to stay small.
True
More than half of small businesses have between one and four employees.
True
One of the biggest advantages that a small business has over a large business is a greater ability to serve specialized markets
True
One of the reasons small businesses continue to thrive in the United States is outsourcing
True
One of the reasons why there has been a dramatic increase in the number of small business startups is rapidly changing technology
True
The Small Business Administration (SBA) assists small businesses by providing advice in management and financial matters
True
The most common use of a business plan is to persuade lenders and investors to finance the venture
True
To achieve a competitive advantage over rivals in the industry, the successful cost leader tightly controls costs throughout its value chain activities
True
To react to change more easily and develop products consumers want, managers and consultants engage in environmental scanning
True
