MGT 310- Ch 7

Which characteristics are associated with successful entrepreneurs?

Innovative, with knowledge and skills in business management and networking

What organizational tendency requires the firm to support new ideas, experimentation, and creative processes?

Innovativeness

What are the three common models individuals can choose from when starting a new e-commerce business?

Business-to-business Subscription Storefront

Select the benefits of a business plan. (Check all that apply.)

It helps entrepreneurs obtain financing. It helps determine the viability of the enterprise. It serves as a guide as the entrepreneur plans and organizes.

What elements must be considered when contemplating a franchise? (Check all that apply.)

Market share Market presence Nature of the business Terms of the license agreement

What technological advances have created entrepreneurial possibilities? (Check all that apply.)

Microcomputers Nanotechnology Biotechnology

Informal work on projects other than those officially assigned, of the employees' own choosing and initiative, is called Blank______.

bootlegging

What are the two common approaches used to stimulate intrapreneurial activity?

bootlegging skunkworks

After a young business begins gaining a foothold and establishing itself, a ______ can help entrepreneurs build and launch a rapidly successful venture.

business accelerator

New venture creators who work inside an existing company are called Blank______.

intrapreneurs

A(n) Blank______ firm will have an easier time acquiring other resources such as top managers, good employees, financial resources, and government support.

legitimate

Getting support for a project from peers before seeking formal approval from higher levels in a company is known as Blank______.

making cheerleaders

What factors influence the success or failure of business start-ups? (Check all that apply.)

management-related challenges economic environment

What are the two major liabilities of start-ups? (Check all that apply.)

newness smallness

The Blank______ factor of the business plan should provide a competitive advantage that can be defended.

opportunity

In the launch of a business, the first formal planning step is a(n) Blank______, which provides the basis for making a decision on whether to act.

opportunity analysis

The most dangerous risk in corporate entrepreneurship is the risk of Blank______.

overreliance on a single project

Many entrepreneurs want Blank______ investors who will give them money and let them do what they want.

passive

Business accelerators ______.

provide support to young businesses that have begun to establish a foothold

What key business element is often an entrepreneur's greatest challenge?

raising money to start the business

One common entrepreneurial problem is an aversion to Blank______.

record keeping

What are some of the benefits offered by incubators? (Check all that apply.)

shared staff costs technical services business services low rent

How can an entrepreneur maintain vigilance over various aspect of the business? (Select all that apply)

Asking critical questions Having good controls

What type of new business has growth and high profitability as primary objectives?

Entrepreneurial venture

In which ways would an entrepreneurial venture be different from a small business?

Entrepreneurial ventures have growth and high profitability as primary objectives. Small business owners tend not to manage aggressively; they expect normal, moderate sales, profits, and growth. The financial backers of entrepreneurs usually seek rapid growth and immediate and high profits.

As an entrepreneur, the challenge called "you might not enjoy it" presents which problem?

Entrepreneurs usually have to do all of the functions of running a business, even those areas they do not like or know how to do.

True or false: A small business differs from an entrepreneurial venture in that a small business operates for growth and profitability, while an entrepreneurial venture is just an innovative idea that can enhance a small business' growth potential.

False

True or false: A small business differs from an entrepreneurial venture in that a small business operates for growth and profitability, while an entrepreneurial venture is just an innovative idea that can enhance a small business' growth potential. True false question.

False

True or false: Management has very little influence on fostering entrepreneurial orientation.

False

What are people seeking when they start their own businesses? (Check all that apply.)

Feeling independent and being part of the action Tremendous satisfaction in building the business and watching it grow and succeed Better quality of life than they might have at big companies Opportunities after they see their progress or ideas blocked at large organizations

What is the promise of payoffs from the project in return for support, time, money, and other resources?

Horse trading

Which statement about Initial Public Offerings (IPOs) is true?

IPOs need to be federally registered.

What is the first-time sale of federally registered and underwritten shares of company stock to the public?

Initial public offering (IPO)

Drag each description to the type of social enterprise that matches it.

The environment: Promoting responsible consumption and habitat conservation Social and economic inclusion: Empowering marginalized groups, revitalized neighborhoods and reducing community violence Health and well-being: Preventing and reducing health risk behaviors and improving access to health care Civic engagement: Community volunteering, charitable giving, and responsible investing

What are the two mistakes entrepreneurs often make about financial resources?

They apply financial resources to the wrong uses. They spend too much.

Which statements are true about the people in your entrepreneurial business? (Select all that apply.)

They should be energetic. They should be good with ideas but ready to switch ideas if necessary. They should have skills relevant to the venture.

What are reasons that entrepreneurial businesses go public by using IPOs? (Check all that apply.)

To raise more capital To pursue otherwise unaffordable opportunities To reduce debt To improve credibility with customers

Entrepreneurship involves Blank______.

creating new systems, resources, or processes to produce new goods or services and/or serve new markets

The central objective of entrepreneurship is Blank______.

creating value

Once a business begins to grow, entrepreneurs must be able to Blank______.

delegate work to other people

As an entrepreneurial business grows, leadership often Blank______.

deteriorates into micromanagement

Due to rising oil prices, there has been a variety of developments in alternative energy or energy-efficient products. These are possible entrepreneurial opportunities due to Blank______.

economic dislocations

One market that traditionally has been dominated by the government and large defense contractors but that is now being explored by smaller entrepreneurs is Blank______.

exploring outer space

New companies without much of a track record Blank______.

face more hurdles attracting investors and customers

Risk refers primarily to the probability of major Blank______ loss.

financial

Lourdes, an innovator, has created a successful store and wants to grow the business. She finds a partner who agrees to manage a new store of the same type as Lourdes' but in a new location. The partner will pay Lourdes for allowing him to use her business model and name. This type of arrangement is called Blank______.

franchising

A great product, a viable market, and Blank______ are essential ingredients to entrepreneurial success.

good timing

A(n) Blank______ is often defined as having fewer than 500 employees, being independently owned and operated, not dominant in its field, and not characterized by many innovative practices.

small business

A competitive advantage in the form of relationships with other people and the image other people have of you is called ______ capital.

social

Organizations that use market-based methods to leverage resources to address social problems are referred to as Blank______.

social enterprises

Which of the following is a key difference between an entrepreneur and an intrapreneur?

An entrepreneur receives no corporate support, whereas an intrapreneur has the benefit of corporate support.

Small businesses whose primary focus is not e-commerce can create attractive websites that do which of the following? (Check all that apply.)

Bring them closer to suppliers, investors, and service providers. Add to their professionalism. Give them access to more customers.

What are two typical ways entrepreneurs can exploit opportunities?

By exploring domains that are avoided by large companies By introducing goods or services that capture the market because they are simpler, cheaper, more accessible, or more convenient

When a company releases a product before its competitors to beat them to the punch or deliberately targets competitors' weaknesses, what is it engaging in?

Competitive aggressiveness

What is likely to happen if there are too many entrepreneurial projects in a company? (Check all that apply.)

Each effort might be too small in scale. Those recruited to manage the projects might have difficulty building power bases within the organization.

Personal Observations

Finished Products were beautiful Saw Women's desire to own their own business

Which of the following best captures Larry's feelings about the relationship between his start-up capital and the success of his venture?

He's got plenty of start-up capital, so he'll be sure to be successful.

What is the creation of something new and different called?

Innovation

Corporate entrepreneurs are also called

Intrapreneurs

Which of the following is true about social entrepreneurship?

It creates economic value and social benefits simultaneously.

Select the characteristics that define a small business. (Select all that apply.)

It is independently owned. It is independently operated. It is not dominant in its field.

What are two traits of an entrepreneurial venture?

It works toward a quick sellout with large capital gains. It seeks rapid growth.

Who among the following most likely possesses the key characteristics of a successful entrepreneur?

Juana is very innovative and knowledgeable and believes that she would be a successful entrepreneur.

What nonfinancial resource involves people's judgment of a company's acceptance, appropriateness, and desirability?

Legitimacy

Nonfinancial resources include which of the following? (Check all that apply.)

Legitimacy in the minds of the public

Which survival difficulties are true of entrepreneurial ventures? (Check all that apply.)

Mistakes in a start-up are potentially devastating. Increased competition can cause start-ups to fail. New ventures have more trouble lining up investors.

Which of these are characteristics of an entrepreneurial personality? (Check all that apply.)

Motivation to excel Leadership Commitment and determination

Management guru Peter Drucker states that family-managed businesses should take which of the following measures in order to survive? (Check all that apply.)

Not all of the key positions should be filled only by family members. Family members working in the business must be as capable as other employees.

Entrepreneurs are more likely to succeed if they have which one of these characteristics?

Opportunity obsession

Which are advantages of partners? (Check all that apply.)

Partners can share expertise. Partners can share the risk. Partners can help with the workload.

When faced with early failures, what do successful entrepreneurs do? (Check all that apply.)

Persist in the face of failure. Revise the initial idea. Kill the initial idea but not the company.

Which are common reasons people become entrepreneurs? (Check all that apply.)

Personal satisfaction Profit potential The challenge Better quality of life

Which statements about business plans are true? (Select all that apply.)

Potential investors want to know more than just financial projections. Many business plans focus heavily on financial projections.

What type of firms are forward thinking and fast to act and are leaders rather than followers?

Proactive

What is the difference in the value of passive or nonprofessional investors with venture capitalists investors? (Check all that apply.)

Professional venture capitalist investors demand more control and more of the returns. Passive investors will give entrepreneurs the money but let them do what they want. Professional venture capitalist investors are likely to solve problems and know how to help.

Business incubators are

Protected environments for new, small businesses

Which factors in the economic environment improve business prospects and increase sources of capital? (Check all that apply.)

Real economic growth Increases in the supply of bank loans Increases in the money supply (capital) Improved stock market performance

Which statement regarding risk in a business plan is true?

Risk must be understood and addressed as fully as possible.

What tendency comes from a willingness to commit significant resources and perhaps to borrow heavily, to venture into the unknown?

Risk taking

______ creates social value by stimulating social change or meeting social needs.

Social entrepreneurship

In what ways can businesses whose primary focus is not e-commerce add value through the use of the Internet? (Check all that apply.)

Start-ups and established small companies can add to their professionalism by creating an attractive website. Traditional companies can save money on customer service/support. Start-ups and established small companies can have more access to customers, suppliers, investors, and service providers.

Drag each example of a company to the type of e-commerce business model that matches it.

Storefront:Websites like Amazon or Walmart Subscription:Websites like The Wall Street Journal Business-to-business: Customer relationship management firms like Salesforce

Which statement about partnerships is true?

Successful partnerships involve honest communication.

How important are nonfinancial resources to new venture success?

The are essential to the success of a new business.

Which of the following is true of the role of the economic environment in the success of entrepreneurial ventures?

The economic environment affects the success of entrepreneurial ventures by affecting the supply of capital and prospective opportunities.

Tiyona Motors plans to introduce a fast, stylish car to its fleet that management hopes will appeal to high-end buyers and grant Tiyona entry into the luxury market. Based on this scenario, what possible outcome should Tiyona be prepared for?

The financial investment will be high, and the competition will be heavy.

Which of the following best captures Larry's view of entrepreneurs?

They are their own bosses and are completely independent.

True or false: An obvious risk of intrapreneurship is failure.

True

Which factors influence the role of the economic environment on entrepreneurial activity? (Check all that apply.)

While bad times in the economy may be challenging, it can also offer an opportunity to expand. Increases in money leads to an increase in prospects and sources of capital, which can increase the rate of business formation. Downturns in the economy require entrepreneurs to have foresight and talent to survive. Entrepreneurial activity stems from the economic environment as well as the behavior of individuals.

Which of the following is a formal planning step that focuses on an entire venture and describes all the elements involved in starting it?

a business plan

Identifying environmental context is important in a business plan because ______. (Check all that apply.)

a favorable regulatory and economic environment will affect the viability of the new venture it can make it easier or harder to get backing and to succeed

For an entrepreneur, the nonfinancial resource of a strong network of people is Blank______.

a great aid for success

Larry is thinking he will be a great entrepreneur because he sees himself as which of the following?

a lone wolf who doesn't like working with others

A(n) Blank______ is a group of people willing to help an entrepreneur learn basics, identify needed strategic changes, and build relationships with bankers.

advisory board

Entrepreneurs can assemble a group of people to help them learn the basics of business and build relationships with bankers, accountants, and attorneys. Such a group is called a(n)

advisory board

Another reason Larry is confident about being an entrepreneur is because he sees his high SATs as which of the following?

an indicator of successful entrepreneurship

Which are included in an opportunity analysis? (Check all that apply.)

assessment of the opportunity source of capital assessment of the entrepreneur description of the good or service specification of resources needed

Which are the five tendencies that determine entrepreneurial orientation?

being competitively aggressive being proactive taking risks allowing independent action fostering innovation

Carl, lab manager for MedEx Pharmaceuticals, told his research chemist, "Mandy, you have my blessing to use company equipment on evenings and weekends to create new products and processes of your own choosing and initiative. I know that this will result in some lost time, but I also know that it will contribute to learning and, ultimately, some profitable innovations." Carl's advice to Mandy is an example of

bootlegging

Where money is made

boutiques showed interest in shoes opportunity for internet sales

The Blank______ describes all the elements involved in starting the new venture.

business plan

When writing a business plan, the cofounders of Zappos considered the impact of other online shoe stores, as well as shoe departments in department stores. This is an example of considering Blank______ in a business plan.

competition

A tendency to outperform one's rivals in the marketplace is called Blank______.

competitive aggressiveness

Which of the following is one of the five key factors that entrepreneurs are required to have thought through?

context

When an enterprising individual pursues a lucrative opportunity, it is known as

entrepreneurship.

An entrepreneurial alliance between an innovator who has created at least one successful store and wants to grow the business and a partner who manages a new store of the same type in a new location is called

franchising.

Driven by advances in technology coupled with changes in the medical field, opportunities are arising in the Blank______ sector.

health care

Legitimacy increases the probability of success of a new business by

helping a firm acquire resources such as top managers and good employees.

What items should be covered when discussing competition in the business plan? (Check all that apply.)

how the company will respond to the competition identification of the current competitors the strengths and weaknesses of the competition

The need to provide a nurturing environment for a fledgling enterprise led to the creation of business Blank______.

incubators

Which of the following provides a way to raise capital through federally registered and underwritten sales of shares in the company?

initial public offering

Which are risks that must be considered in the business plan? (Check all that apply.)

interest rates changing fierce competitor responses key people leaving the company losing a key customer

Han has an innovative idea for a new technology service and wants to start his own business. Han is most likely to be successful if he Blank______.

is creative and and has good business know-how

One of the common challenges entrepreneurs face is

lack of enjoyment in what they do.

In order for Larry to be a successful entrepreneur, he needs to be knowledgeable and have

networking skills.

To be Blank______ means to act in anticipation of future problems and opportunities.

proactive

Which of the following is an example of an entrepreneurial opportunity categorized under economic dislocations?

rising oil prices

Renee works as a respected senior engineer for a large manufacturer of pharmaceutical process equipment. Several researchers within the company have discovered an innovative way to repackage pharmaceutical drugs. The company has given Renee the opportunity and responsibility to lead a fully funded project team for 12 months to develop this idea. She is excited to lead this ________ team.

skunkworks

A(n) ________ differs from an entrepreneurial venture in that it is not managed aggressively, and its owners expect normal, moderate levels of sales, profits, and growth.

small business

Leveraging resources to address social problems is called Blank______.

social entrepreneurship

Organizations court failure when they Blank______.

spread their entrepreneurial efforts over too many projects

Founding entrepreneurs often fail to plan for Blank______, an issue tied to the entrepreneurs' mortality.

succession

Larry's thoughts about starting a business and the length of time it takes to reach profitability are based on the assumption that

talented entrepreneurs are able to make a business profitable within one year.

Which factors are associated with environmental context? (Check all that apply.)

tax policies interest rates inflation exchange rate

A company's advisory board can do which of the following? (Check all that apply.)

teach the basics of business operation build relationships with other professionals identify needed strategic changes

A disadvantage of going public is the Blank______.

tendency to focus more on the stock price rather than running the business

Select the elements regarding customers that must be addressed in a business plan. (Check all that apply.)

the cost to acquire and support a customer the decision-making process of the customer the ease or difficulty to retain a customer

Which of the following e-commerce business models brings buyers and sellers together and charges a commission for each sale?

the intermediary model

The primary difference between entrepreneurship and intrapreneurship is Blank______.

the level of corporate support and company resources

An entrepreneur has the most incentive to be careful with financial resources if Blank______.

the money comes from the entrepreneur's own assets

One of the keys to starting a business is obtaining the money to do so. Where do start-up businesses typically get most of their money from?

the owners, their families, and bank lines of credit

For many astute investors, the most important variable of business plans is Blank______.

the people

In addition to the financial projections, the best business plans convey which key factors? (Check all that apply.)

the people the opportunity the risks and rewards the competition the context

market need to be filled

theres a market for handcrafted goods in US

One thing entrepreneurs may not realize when they begin their venture is that Blank______.

they usually have to work every aspect of the business

To spot opportunities for entrepreneurial ideas, you should Blank______.

think carefully about events and trends as they unfold

Underlying social condition

women wanted and needed to earn a living

Larry is sure that entrepreneurs do which of the following?

work harder than managers in big companies