Chapter 7 Review

they feel like victims of the actions of others

What is true about people with an EXTERNAL locus of control?

it is/can be steep

What is true about the initial price of buying a franchise?

personal resources

Ginnie owns a galaxy-themed smoothie shop. The entire shop resembles a rocket ship! She has also installed a projector that transforms the ceiling into a starry night sky. Ginnie used most of her savings to fund this venture and borrowed funds from family members. What type of funding of a small business is being used in this scenario?

they have made it easier to manage a firm on the go

How has technology made it easy for small businesses?

providing personal customer customer

Jerry owns a film studio with high-quality equipment. He allows videographers to schedule sessions based on their flexibility. He also allows clients to bring their own production assistants and works with them to achieve the desired result. As a result, his customers frequent his studio and recommend it to their friends and colleagues. Which opportunity of owning a small business is highlighted in the given scenario?

challenge

Maggie works as a stain-glass window maker at an interior design company where a group of artisans are required to produce a specific design of a window, and the product is later assembled. Maggie quits her job and starts a small decoration business where she crafts unique products based on the demands of her customers. She feels that the constant need to adapt and outperform herself keeps her focused and motivated to improve her craft. Which advantage of entrepreneurship is highlighted in the given scenario?

commercial loan

Upton Bank is well known for providing funds to start-ups. The bank lends money to an entrepreneur at an interest rate of 8%, which is to be repaid only after the business earns a sizable profit. If the business fails, then only the primary amount needs to be returned. What type of loan is Upton Bank providing?

they can make it more personal to the customers and cater towards them

What can small businesses do with customer service in the terms of opportunities?

industry-specific stats

What is a piece of information is found in the US SBA resources?

they view the world in shades of grey

What is a true statement of entrepreneurs who are tolerant of uncertainty?

market niche

A small segment of a market with fewer competitors than the market as a whole. These tend to be quite attractive to small firms.

U.S. Small Business Administration (SBA)

Assists entrepreneurs by partially guaranteeing loans from local commercial lenders.

she's confident, but not OVER confident

Dixie is a young entrepreneur who has invested in creating a new form of camera. She believes that her idea will be successful with the younger generation later on. However, she is careful not to be overly optimistic about it and works on other ideas as well. Is Dixie being overconfident in her abilities?

angel investor

Nobel is a wealthy is successful businessman who is well known for financing many successful start-ups. He has earned a sizable amount of profit by providing capital to start-ups in return for a share of their profits. What type of investor is Nobel?

peer-to-peer lending

Offers a potential funding source for new business start-ups

flexibility

Organizing meetings with clients by making appointments that fit a start-up realtor's schedule is an example of this advantage of entrepreneurship.

using technology

Paisley owns an online eyewear store. She has developed a smartphone application for her business that allows her customers to take their own picture and "try out" virtual eyeglasses before placing an order. The opportunity of ___________ is highlighted in the given scenario.

vision

Penny opens a repair shop that specializes is in fixing antiques. She had the idea during her senior year in college and despite receiving criticism for the idea, she goes ahead and opens the store. Which entrepreneurial characteristic is highlighted in this scenario?

high risk of failure

Ronnie has been involved in lots of start-ups. However, none of her ventures have been successful because of severe competition in the market and personal issues such as poor health and lack of dedication. Which threat is highlighted in this scenario?

exploiting market niches

Sydney starts a business that specializes in building and selling customer glass items. Her business caters specifically to individuals who have high-income jobs and who like collecting unique artifacts. Sydney does not have much competition and can decide the prices pf her products without any external influence. The opportunity of __________________ is highlighted in the given scenario.

true

T or F: in the context of small businesses and the economy of a country, entrepreneurship rates are significantly lower in countries where it is hard to get fired.

false

T or F: Donnie feels that an incredible string of bad luck has affected his personal life. He also feels that his boss is subjecting him to unfair treatment at work for no fault of his. Donnie's perceptions suggest that he has an internal locus of control.

false

T or F: Teddy's new company is experiencing a steady decline in profit. He needs external financing to prevent his company's profits from declining further. Considering the fact that he wants to exercise sole ownership and control over the firm for as long as possible, Teddy is likely to find angel investors whoa re interested in helping him meet his financial needs.

true

T or F: administrative costs for small health plans are much higher for large firms making it tougher for small firms to offer coverage to their employees.

true

T or F: an advantage of starting a business from scratch is that the entrepreneur has the freedom to use his or her own ideas and concepts.

false

T or F: an external locus of control is a deep-seated sense that the individual is personally responsible for what happens in their life.

false

T or F: based on statistics from the US SBA, small businesses account for 78% of all private sector employees.

false

T or F: based on statistics from the US SBA, small businesses comprise 49.9% pf all businesses in the US.

false

T or F: for entrepreneurs, there is no correlation between dollars earned and hours worked.

false

T or F: in the context of self-reliance, people with an external locus of control rely more on their own efforts and less on the actions of others.

true

T or F: self-reliance is a characteristic that most successful entrepreneurs possess.

true

T or F: small businesses often have an advantage in foreign markets where customers want to deal directly with a company's top management.

true

T or F: some businesspeople, called necessity entrepreneurs launch their business because they believe it is their only economic option.

false

T or F: the US SBA gives free money to start-up businesses.

false

T or F: the US SBA microloan program lends an average of $50,000 to start-up businesses through community non-profit organizations.

eliminating complex regulations placed on businesses

The nation Ketchacan has the lowest entrepreneurship rate globally. A new government, headed by president Hazzy, aims to make the country's business environment more supportive toward burgeoning entrepreneurs. Which measure should be taken to increase the entrepreneurship rate in Ketchacan?

lower

When entrepreneurs of small firms serve a variety of roles, from CEO to customer service rep, such firms have what type of overhead costs?

venture capital

Which funding option provides advice and guidance to start-up businesses along with funds?

external locus of control

____________ is a deep-seated sense that forces other than the individual are responsible for what happens in their life.