Management - Chapter 5

how much money is needed to start the business and keep it operating

The most important element of a business plan's financial plan is the cash budget, which shows______.

In most cases, the small businesses are either affiliates of or sell products provided by larger firms.

Which of the following statements is true about the finance and insurance industry?

service

Pet care salons, skin clinics, and day care centers are all examples of businesses operating in the _____ industry.

small business

A _____ is privately owned by one individual or a group of individuals and has sales and assets that are not adequate enough to meaningfully influence its environment.

production strategies

A business plan is most likely to contain_______.

manufacturing

A good deal of money is usually needed to start a(n) _____ business because of the investment normally required in equipment, energy, and raw materials.

Identifying distinctive competencies

As a small business owner, Ahmed feels he has identified a market that no one else is currently serving. Which of the strategic challenges facing small firms is Ahmed developing?

a venture capital company

Delta Inc., an electric car maker, initially had financing from a small group of investors seeking to make profits through rapid growth. The investors did not lend money, but invested it in the company in return for stock. Delta's source of financing was________.

Strategic alliances

Geert would like to open a cafeteria to provide meals to workers at the local hospital. However, he needs to find a source of financing. He has approached the hospital to discuss it providing and building the cafeteria. Which source of financing is Geert pursuing?

Wholesale

Graver Bros. Inc. is a company that buys packaged organic grains from local farmers and sells them to supermarkets in large cities. Graver Bros. Inc. operates in the _____ industry.

Choosing an industry in which to compete

Of the basic strategic challenges facing small firms, which one must be addressed first?

Entrepreneur

Sasha owns a day care center and makes all decisions about how the center runs, what services it provides, and at what prices. She has funded the venture with her own savings and has complete responsibility for the success or failure of the venture. Sasha is most likely a(n)________.

provide big businesses with many of the services they need

Small businesses______.

exchange money for partial ownership in the new business

Venture capital companies_______.

Analysis of market conditions

What is a general factor that contributes to the success of small businesses?

Franchising agreement

Which is a contract between an entrepreneur and a parent company that requires the entrepreneur to pay the parent company for the use of its trademarks, products, formulas, and business plans?

The entrepreneur may suffer the ill effects of a prior owner's errors.

Which of the following is a disadvantage of buying an existing business?

The franchisee loses some independence in running the venture.

Which of the following is a disadvantage of franchising agreements?

The entrepreneur is free to choose inventories and locations.

Which of the following is an advantage of starting a business from scratch?​

What are the entrepreneur's goals and objectives?

​Which of the following is an important question that is answered in a business plan?

identifying a new market

Henry created a new flavor of ice cream to add tohis menu of homemade ice creams in the ice cream parlor he owns in Florida. The ice cream became an instant hit; he plans to sell the ice cream in Georgia by supplying it to retailers there. Henry is involved in_______.

NutriMax has introduced its low-fat cookies in Asia.

Which of the following is an example of a company that has identified a new market?

Modifying a computer so that it is usable by untrained persons

Which of the following is an example of identifying a new niche in an established market?

Niche

While there are many businesses in the general area that offer lawn mower repair, they all require that the customer bring the equipment to the store. Diane realized that this is difficult for many consumers, and she started a business in which her service techs bring the repair shop to the customer. Diane is capitalizing on a(n)______.

Distinctive competencies

_____ are the aspects of business that a firm performs better than other companies in the same industry.