Chapter 1 Quiz
A benefit corporation (or B-Corp) is an organization certified by the nonprofit B Lab to ensure strict standards of social and environmental performance, accountability, and transparency are met. According to the book, which of the following statements is true?
"Buy one, give one" promotions can generate sales while also raising awareness of social issues.
What percentage of U.S. businesses are family-owned or controlled by a family?
80% to 90%
Discuss "social entrepreneurship" and describe the differences between entrepreneurial ventures and nonprofit organizations.
There has been some debate as to how to define social entrepreneurship. Some argue that all types of entrepreneurship are social, while others define it as purely an activity of the nonprofit sector. These blurred lines imply that entrepreneurs are forced to choose between making a social or an economic impact. We contend that social entrepreneurs can do both. It is possible to address a social issue and make a profit—keeping a company economically stable ensures its capability consistently meets the needs of its customers without relying on fundraising or other methods to keep it afloat. We therefore define social entrepreneurship as the process of sourcing innovative solutions for particular problems.
Successful entrepreneurs tend to follow this approach to collaboration.
They collaborate with both potential customers and competitors.
Social entrepreneurship encompasses only not-for-profit ventures.
True
Tony is a manager for a company that builds solar panels. In his position as a manager, Tony used the feedback from his team members as the basis of a plan for the company to start installing the solar panels, as well, in order to enhance the company's competitive position and profitability. Tony is an example of a(n)
corporate entrepreneur
Richard Branson's expansion of Virgin to include railway, music, media, and banking industries is an example of
serial entrepreneurship
Richard Branson's expansion of Virgin to include railway, music, media, and banking industries is an example of ______.
serial entrepreneurship
Sam is tired of seeing injustice and mistreatment of children in inner cities and has an innovative idea to help them develop self-esteem. Sam is an example of a
social entrepreneur
Entrepreneurs are traditionally extreme risk-takers.
False
Joan has pursued seven money-making ventures over the past ten years ranging from retail storefronts to mobile app development. Joan is a "serial entrepreneur."
True
Unlike necessity-based entrepreneurs, opportunity-based entrepreneurs freely make their own choice to get involved in a business.
True
Which of the following led to entrepreneurship regaining its popularity over the last decades of the 20th century?
all of these
Buying an existing small business is not considered entrepreneurship.
false
Social entrepreneurs
seek innovative solutions to social and environmental problems
According to the 2015/16 GEM report, the percentage of entrepreneurs in the United States has declined to 3%—the lowest on record.
False
Risk cannot be averted by an entrepreneur's activity or attitude.
False
Robert has a business that he wants to pass down to others in his family to run. Robert has ______.
a family enterprise
Scientific evidence has proven that a specific set of traits distinguishes entrepreneurs from non-entrepreneurs.
False
The authors define entrepreneurship as ______.
a discipline that seeks to understand how opportunities are discovered, created, and exploited, by whom, and with what consequences
Michael is a franchise restaurant owner. Which of the following best describes his franchising costs?
a franchise fee to start, a monthly royalty as a percentage of sales, and other operational costs
Total entrepreneurial activity (TEA) is the percentage of the population of each country between he ages of 18 and 64, who are either
a nascent entrepreneur or owner-manager of a new business
During the period between 1920 and 1975, which of the following did NOT contribute to the decline of the traditional entrepreneur?
an increase in production due to the expansion of the middle class
Rahul wants to start a spice business but wants a secure framework with experts in property rights, accounting, law, investment banking, and technology. Of the conditions that need to be put in place for the Entrepreneurial Ecosystem, he needs
commercial and legal infrastructure
This is the discipline that seeks to understand how opportunities are discovered, created, and exploited, by whom, and with what consequences.
entrepreneurship
Individuals who are still active in business for over three and a half years are known as
established business owners
According to the authors, entrepreneurship is best taught as a linear process that will lead to a specific destination.
false
B-Corp certification recognizes organizations that achieve five or more years of consistent profitable growth.
false
Bill Gates was an overnight success because it took only three months to become a success.
false
Entrepreneurship is reserved for startups
false
According to the text, why would some organizations not be enthusiastic about employees acting entrepreneurially inside a company?
fear that they will leave the company and start their own business
What is the process of creating new products, ventures, processes, or renewal within large organizations?
intrapreneurship
To be certified as a benefit corporation (or B-Corp), an organization is rated on all the following except
it global mission
The entrepreneurial method requires consistent practice so that ______ can be continuously developed and applied to future endeavors.
knowledge and expertise
Which of the following is NOT a condition for small and medium businesses to flourish in a country?
large population size
What is the survival rate of family businesses transitioning from the first to the second generation?
less than 30%
Research revealed what percentage of Inc. 500 wrote formal business plans prior to launching their companies?
less than 50%
______ are small, short-term loans often associated with entrepreneurs in developing countries.
microloans
Individuals who have set up a business they will own or co-own, which is less than three months old and has not yet generated wages or salaries for the owners, are known as ______.
nascent entrepreneurs
Which of the following is NOT an aspect of the Entrepreneurship Ecosystem described in the chapter?
open-access patent databases
Sally decided to look into buying a franchise as her entrance into entrepreneurship. Which of the following is NOT a benefit of franchising?
potential competition from other franchise owners
The nonprofit 1001 Fountains for Tomorrow, whose goal is to provide safe drinking water for small rural villages in Cambodia, is an example of
social entrepreneurship
A temporary organization in search of a scalable business model is known as a(n) ______.
startup
Effectuation is the theory that
the future is unpredictable yet controllable
During the period between 1920 and 1975, which of the following did NOT contribute to the decline of the traditional entrepreneur?
the transition toward a knowledge-based economy
Contemporary researchers focus on how entrepreneurs
think and act
An entrepreneur can own his or her own business or work in a corporation with an entrepreneurial spirit.
true
Corporate entrepreneurs work within only large organizations whereas entrepreneurs inside can exist in any type of organization, big or small.
true
