Entrepreneurial Unit3 Test

In handling questionable costs, the cost in question is substituted first as a _____ and then as a _____.

fixed cost; variable cost

The concept of the net present value method works on the premise that

a dollar today is worth more than a dollar in the future.

A market is

a group of consumers who have purchasing power and unsatisfied needs

A marketing information system compiles and organizes data relating to _______, revenue, and profit from the customer base.

cost

The owner of a copyright may do all of the following except

deduct the intrinsic value of the rights from one's taxes

Because of the doctrine, it is sometimes difficult to establish infringement.

fair use

It is typical for a firm to prepare an operating budget but not a cash budget.

false

The cash flow does not come from

goods purchased on account

Sometimes consumers associate a higher price with

higher product quality

The purpose of marketing research is to __________.

identify customers

What part of the marketing plan emphasizes the factors that contribute to a firm's competitive edge?

the appraisal of marketing strengths and weaknesses

To an entrepreneur, one of the benefits of a business plan is

the identification of critical risks.

A critical point to be included in the business description is:

the potential advantages the new venture has over the competition

When using the graphic approach to break-even analysis, the entrepreneur must plot which of the following?

total revenue and total costs

An entrepreneur is much better off preparing his or her own business plan rather than hiring someone else, even if more experienced, to prepare it.

true

Lack of any time frame to accomplish things is an indicator of the pitfall known as no realistic goals.

true

Mobile social media applications can be differentiated based on location-sensitivity as well as on time-sensitivity.

true

Which of the following questions should an entrepreneur ask when a business plan is turned down?

"If you were in my position, how would you proceed?"

Which of the following are suggestions to minimize legal costs?

visit the lawyer during normal hours of operation

Which of the following statements about a business plan is true?

It is the minimum document required by any financial source.

The entrepreneur should expect to encounter a friendly and supportive audience when presenting the business plan to potential financial sources.

false

A business plan __________ potential financial backers.

establishes a first impression of the company and its principals on

Secondary data consists of

existing information

Pro forma statements show the firm's present financial position.

false

The entrepreneur's professionalism and how well he or she handles the venture capitalist is far more important than being well organized and prepared.

false

Pricing in the social media age can be based on a model that offers basic service for free.

true

How many months of the year should be illustrated in the first pro forma income statement?

twelve

Gross margin measures profitability at the gross profit level: the number of dollars of gross margin produced for every $1 of sales.

true

What is meant by product life cycle pricing?

The pricing needs to be adjusted at each stage in a product's life cycle.

Which of the following statements about the marketing skills of great entrepreneurs is true?

They have clear visions of what they want to achieve next.

Which of the following influences the choice of marketing philosophy?

competitive pressure

In the simple linear regression analysis equation, Y = a + bx, b represents

the slope of the line

A copyright provides exclusive rights to creative individuals for the protection of their artistic productions.

True

Anyone who violates an author's exclusive rights under a copyright is liable for infringement.

True

Because corporate law makes it difficult for businesses to consider employee, community, and environmental interests in their decision making, the B corporation has been introduced.

True

One of the principal advantages of a corporation is that the stockholder's liability (the most money a person can lose) is limited to an individual's investment.

True

The object of a patent is to provide the holder with a temporary monopoly on his or her innovation.

True

The two parts of a patent application are specification and claims.

True

Which of the following is the most common viewpoint in business plans

an entrepreneur's viewpoint

In some professional areas, the business plan is referred to as

an investment prospectus

One type of budget used by the entrepreneur is

an operating budget

To establish a sole proprietorship, a person needs to

obtain whatever local and state licenses are necessary.

Which of the following is a critical factor to be considered in the management segment?

organizational structure

If an entrepreneur concludes that an innovation will withstand any legal challenge, a patent should be

pursued

The textbook recommends which of the following devices to help in the oral presentation of a business plan?

an outline

Which of the following is a critical factor that should be discussed in the management segment?

board of directors and consultants

The part of a patent application that defines and limits the patented invention is known as the

claim

In the production budget for a manufacturing firm, the number of units needed in inventory is determined by

the sum of the desired ending inventory and the number of units to be sold.

Control versus communication is an important distinction between social media marketing and traditional marketing.

false

Financial information is important to entrepreneurs because:

it pulls together all the information presented in other segments of the business.