Innovation and Entrepreneurship

________ motivations come from the individuals themselves.

Personal

TRUE/FALSE: An entrepreneur's prior experience places boundaries on what he or she will consider when making decisions.

TRUE

TRUE/FALSE: New businesses have greater flexibility in responding to changes that take place in their external environment.

TRUE

Online communities such as blogs and chat rooms can provide _______ to people starting a business.

advice

When a firm reaches its break-even point, the revenues are _______ its expenses.

equal to

Potential entrepreneurs must understand their level of tolerance to

risk

Women of color account for ____ of business headed by women.

1/3

Individuals from outside an industry are able to establish a new business in a manner not previously considered because they

have bounded rationality.

Students need to consider their own resources and abilities early when they think about starting an entrepreneurial business because of the

importance of an owner to a new business.

_______ is rational decision making that is constrained by the background and history of the person making the decision.

Bounded rationality

Small Business Development Assistance Centers provide

free advice to new businesses.

A business _______ is a facility that houses new businesses and provides many critical services.

incubator

People in an entrepreneur's network can help by providing ________ to a new business.

legitimacy

Having a network helps a new firm by providing a

level of legitimacy.

The founders and the leadership they provide play _____ of a critical role in the business's success than senior leadership in the typical large organization.

more

There are successful business people in all _______ categories.

personality

People should start a business that they

will enjoy

Which of the following are supports that entrepreneurs rely on?

1) Family 2) Social networks 3) Financial resources

_______ is a managerial theory that believes individuals act to maximize their own benefit.

Agency theory

An excess of resources in an organization that allows for redundancy and the quick deployment of personnel is referred to as

organizational slack

Which of the following are benefits of family-owned businesses?

1) Family members may be willing to take only a partial or no salary during difficult times. 2) Family members help the entrepreneur overcome many difficulties that may cause failure. 3) Family members may be willing to work extra hours during the holidays.

Which of the following are potential negative issues related to owning and operating a family-based business?

1) Family members may take advantage of their personal relationship with the owner. 2) Family members may bring non-work issues to the business. 3) Family members may be more difficult to reprimand or fire.

Which of the following are characteristics of a family business?

1) Family members work together to support the business. 2) A family has unique issues.

Which of the following groups might be included in an entrepreneur's key support network?

1) Former employers 2) Friends from school

The Enneagram's nine personality types include which of the following?

1) Helper 2) Achiever 3) Reformer

Identify the websites that help a company reach out to a wide community online to get funding and often advice in the process of raising those funds.

1) Kickstarter.com 2) Crowdfunder.com

Which of the following are correct regarding the characteristics of large businesses?

1) Knowledge is widely dispersed throughout the business. 2) No one person is critical to the business's survival. 3) They have greater excess resources.

Identify the typical triggers for starting a business.

1) Receiving evidence that an idea is not only doable, but there is a concrete way to improve on a given problem. 2) Experiencing the inability to climb the corporate ladder due to circumstances. 3) Being spurred to action by attending a seminar, reading a book, or talking with successful entrepreneurs.

Which of the following are advantages that small, new businesses have?

1) Small businesses fill niches that large firms simply cannot afford to fill. 2) Small businesses are owned and run by the same person/people. 3) Small businesses can respond quickly to opportunities or threats as they arise.

Which of the following are reasons why owners are a great asset to a new business?

1) Their personal involvement 2) Their dedication

Which of the following is NOT one of the three types of specific risks?

Network

A personality test can help one

select the type of business to start.

By providing resources that new businesses cannot otherwise afford on their own, incubators can help these businesses establish

some level of legitimacy.

Entrepreneurs should work with family members for their advice, potential funding, reality check, and

support structure

Entrepreneurs' prior experience plays a role in new business creation through

their view of the world.

When starting a business, one must understand the relationship between ______________ and the expected return.

time commitment

Starting a business is often the result of an event or condition within an individual's environment called a(n)

trigger

To fully utilize family resources, entrepreneurs should

1) Make a list of members that they have regular contact with. 2) List the capabilities those individuals possess that might be helpful.

The Big Five test comprises which of the following factors?

1) Open-mindedness 2) Emotional stability 3) Extroversion

Which of the following statements about agency theory are correct?

1) Owners always act to maximize the value of the business. 2) Agents often maximize their own benefit. 3) Managers are considered agents.

Which of the following are components of the entrepreneurial orientation concept?

1) Personality orientation. 2) Risk tolerance. 3) Prior experience.

Which of the following statements regarding Small Business Assistance Centers are correct?

1) They are funded by the Small Business Administration. 2) They provide a wide variety of support such as research aids. 3) They are often associated with SCORE offices.

Which of the following statements about women entrepreneurs are true?

1) They are one of the fastest-growing segments of entrepreneurs. 2) They often run into a "glass ceiling." 3) They often start up businesses at a rate of 50% more than men.

Identify the true statements about new businesses triggered by circumstance motivators.

1) They are opportunistic start-ups. 2) The staying power of these businesses is determined by other competing opportunities.

Which of the following statements regarding entrepreneurial businesses are correct?

1) They have limited flexibility in responding to emergency issues such as the need to hire replacements if the company loses key individuals. 2) They are generally dependent on a single person or a few individuals.

Identify the features of circumstance motivators.

1) They tend to result in more of a defensive positioning. 2) They result from environmental changes.

New business owners need to be sure that the level of risk is consistent with their

1) Values 2) Background 3) Family situation

TRUE/FALSE: It is advisable for an entrepreneur to ensure that sufficient financial resources are available prior to or at the start of a business.

TRUE

Entrepreneurs need to have a(n) ______ vision of what resources are necessary in order to be successful.

realistic