Exam 1
Multistate businesses only collect sales tax in their home state.
false
Outside of the United States, there are few entrepreneurial ventures.
false
The planning process of a venture includes the financial and human resources to implement the idea.
true
Which of the following demonstrates an ethical issue that could lead to an infringement of CSR?
A company's website is hacked and millions of customers' identity information is lost. The company sells most of its stock for protection and then tells its customers about the hack.
Why should entrepreneurs be careful when working with others on their business venture?
A general partnership can be informally created by the actions of people pursing the business.
Where do profits go in a for-profit business?
All profits are distributed to owners
Most publicly traded companies go public when they first begin operations.
False
What are the most important benefits of micro-lending?
Targeted to small businesses and shorter approval times
Which of the following statements is true about women entrepreneurs?
Women receive significantly less venture capital funding than men.
What is the purpose of the customer empathy map?
accurately portray the target market for the product/service
Why will a disruptive technology fail in most instances?
because a different business model will be needed to realize the technology's potential
When an existing business fundamentally changes their approach to the business, it is called ________.
business model innovation
For entrepreneurs, the simplest method of framing a problem in the form of a question ________.
can be eye-opening
Mr. Patel is conducting research in his target market to see if the product he designed delivers different benefits than those of his nearest competitor. He is most likely trying to determine whether his product has a ________.
competitive advantage
Which type of analysis uses a grid to compare all the vendors that provide the same product or service in an area?
competitive analysis
Which of the following is not an example of a social-environmental entrepreneurial problem?
concern for government funding
The human ability to feel what other humans are feeling, which in the context of creativity, innovation, and invention is essential to beginning a process of human-centric design, is called ________.
empathy
Which of the following is also referred to as business structure from a legal perspective?
entity selection
According to Elon Musk's six-step decision-making process, if nobody can invalidate your conclusion, then you're certainly right about it.
false
According to the required Penn State Video, assessing the level of available inputs required to run the venture is part of the Market Analysis.
false
According to the text, even with practice, not everyone can improve in their creative efforts.
false
According to the text, the main reason the videophone didn't start to take hold in the marketplace until the early 2000s was because of the cost.
false
Adaptability is about addressing the assumptions that will create customer value.
false
An invention is an innovation implemented and used on a large scale.
false
An organization need only consider short-term risks when starting out.
false
Every innovation rises to the level of a unique invention.
false
In the business plan document, you should not address any competitors in the industry.
false
Which of the following is used to help determine whether to continue with the venture?
feasibility study
Which of the following describes the process by which entrepreneurs evaluate product ideas, strategies, and marketing trends?
opportunity screening
Which of the following best describes expanders and scalers' approach to venturing?
seeking out opportunities to expand processes, products, or creating methods
A competitive analysis provides information about how competitors market their products and services.
true
Assessment is determining the idea you plan to offer through your venture.
true
Before acquiring Company A, the executives and lawyers conducted an audit of Company A's financial records. This is an example of due diligence.
true
Invention is the act of bringing ideas or objects together in a novel way to create something that did not exist before.
true
Moore's law is still valid.
true
PRIZM data can show entrepreneurs specific lifestyle traits of a population within a certain zip code.
true
The objective of Stanford's Design School ideation practice is to generate as many ideas as possible and then start to develop some of those ideas.
true
US Census data can help aspiring entrepreneurs know if they need to provide products and services to their markets in multiple languages.
true
Successful Innovators need not be technologically proficient or creative, but successful innovators are often skilled at bringing technologies to market in new and profitable ways.
true
Disruptive innovations often create new markets.
true
The relationship of an entrepreneurial mission and the founders' values can be diagrammed as "entrepreneurial mission statement → personal values → personal mission statement".
false
What kind of thinking involves a logical, step-by-step process?
linear
Which of the following combinations creates the greatest entrepreneurial opportunity?
low supply, high demand
Which of the following is an example of bootstrapping?
maxing out personal credit cards to start a business
When faced with an entrepreneur who makes an ethical breach, employees should not speak up or escalate the problem because it is a startup anyway.
False
Ethics are standards of behavior that you choose to uphold.
True
Significant market structure means that a product or service has value because it provides a solution that the target market is willing to purchase.
false
Which is not a factor that makes a location one of the 50 Best Places in America for Starting a Business?
federal government funding
The Ten Principles of the United Nations Global Compact cover all of the following principles except ________.
fraud
The entity selection directly affects ________.
how the entity is taxed
Which of the following is an example of an entrepreneur?
innovator
Searching for and finding solutions outside of the organizational structure is known as ________ innovation.
open
What are the primary needs of shareholders?
realizing value
Uber, Lyft, and DoorDash are examples of which type of economy?
shared economy
3-D printing is an example of what type of innovation?
disruptive
What is the first step in any entrepreneurial venture?
Establish the nature and purpose of the business
Type of Entrepreneur
Innovators creators market makers expanders and scalers
Why do most businesses fail within the first few years?
cash flow issues
How is a serial entrepreneur different than a social entrepreneur?
A serial entrepreneur is someone who starts multiple entrepreneurial ventures, while a social entrepreneur is someone who focuses on solving a problem.
Most theorists believe there is only one definition of entrepreneurial success, which is to make money.
false
Social entrepreneurs only start nonprofits.
false
market makers
innovate or reinvent their market from a future perspective by asking what the market could evolve into
Others acknowledge that a small business owner may also be an entrepreneur
they are not mutually exclusive.
Freelance workers earn a median rate of $50 per hour.
false
According to the required Penn State video, feasibility studies include a market analysis, technical/production analysis, and financial analysis.
true
The business plan should begin with an executive summary.
true
Disruptive innovations often create new markets.
True
Many businesses fail because of a lack of proper understanding of the problem from the beginning of the venture.
true
Which of the following is not a reason for the downward slide in the number of employees working for self-employed businesses?
desire over control of one's career
Which of the following best describes an entrepreneurial mindset?
desiring to take business risk for growth
What element(s) of potential success are crucial beyond simply having an entrepreneurial mindset?
funding and education
Not-for-profits are formed to ________.
further a social cause
Harvest
point at which the investors and entrepreneurial team receive their return on creating and building the venture
entrepreneurial venture
the creation of any business, organization, project, or operation of interest that includes a level of risk in acting on an opportunity that has not previously been established. -some entrepreneurs, this could be a for-profit venture; for other entrepreneurs, this could be a venture focused on social needs and take the form of a nonprofit endeavor.
Which of the following is an example of a practical business mission statement?
"Serve as a leader and live a balanced life."
The difference between risk and calculated risk is
Due Diligence Conducting the necessary research and investigation to make informed decisions that minimize risk
Innovators
Find new approaches, methods, or products that add value through solving a problem in a unique manner
According to the required Penn State video on Feasibility Analysis, the Financial Analysis portion does not include the following:
Production Analysis
What is a major purpose for using the business plan externally?
as an investment tool
Why is the United States a country that "grows" successful entrepreneurs?
because there are few prescribed conformity traditions
What does the acronym "CSR" stand for in Chapter 3?
corporate social responsibility
Netflix started in 1997 as an online movie rental service. Users could browse the online catalog and order DVDs to be delivered to their homes. Today it is a streaming platform. As the company's success grew, several chains of storefront video rental businesses went out of business. This phenomenon is known as ________.
creative destruction
In addition to the examples provided in the text, the innovation by Apple that now would fit into the category called a "smartphone" is a good example of ________.
disruptive technology
Which of the following is the most effective way to cultivate anchoring organizational strategies?
encouragement
Almost 75 percent of millennial workers would agree to work for 25 percent less money to work for a company whose business values comport with their personal values.
false
Corporations are urged by laws and regulations to develop a principled approach to do business.
false
Defining the problem must be based on honest and rational observation that avoids emotions for human-centric design to work.
false
Developing a prototype is always the most tedious part of inventing.
false
Having a patent agent write an application instead of a patent attorney may help to protect your invention against future legal challenges.
false
Information gained from a SWOT analysis can be used in a PEST analysis.
false
Innovation describes a truly novel product, service, or process that, though based on ideas and products that have come before, represents a leap. It is a creation truly novel and different.
false
Inventors always realize great wealth from their inventions.
false
Primary sources include published research from questionnaires.
false
Stakeholders are a small group who are owners of a company.
false
The development of CSR has been a steady progression of success and advancement.
false
The entrepreneurial perspective does not emphasize solving problems to make lives easier.
false
The number of self-employed persons has been dropping since 2016.
false
The rise of subscription services is attributable to grant funding.
false
The state in which you live is the state in which you must form your business.
false
When creating a competitive analysis, you should keep the focus on the entrepreneur's ideas and desires rather than the key elements of the customers.
false
For the Six Thinking Hats exercise to work best, the Black Hat maintains control and keeps the practice moving quickly.
false BLUE
In deciding whether to start their business, the founders of Netflix needed to determine if there were enough people interested in renting their DVDs through the Internet to make their investment worth the time and effort. They needed to determine the ________ of the venture.
feasibility
If the costs of a venture are too high and the profit is too low, the entrepreneur may need to consider whether the venture is ________.
feasible
To delve more deeply into ideation as a practice, the text introduced the "Six Thinking Hats" method, where the White Hat ________.
frees you from considering other aspects of a problem that can limit creativity when you are looking for a solution
The ideation practice which comes from Stanford's Design School has the objective to ________.
generate as many ideas as possible and start to develop some of them
The first consideration for entity selection is ________.
if the business will be for-profit or not-for-profit
Coca-Cola's brand-line extension with Cherry Coke and Coca-Cola with Lime is an example of ________.
incremental innovation
The experience of being an entrepreneur can be fun, exciting, and refreshing, as long as you do which of the following?
keep your creative spirit alive and in constant motion
Creative thinking is more often ________ thinking, free and open thinking in which established patterns of logical thought are purposefully ignored or even challenged.
lateral
According to the text, Schumpeter described the cyclical destruction and creation of new businesses as ________.
natural in a capitalist system
Which of the following is an example of leaving a positive footprint on the planet?
opening local schools to educate the local populations on their resources
Which age range accounts for the most startup activity?
over 40
The ________ stage of creativity involves investigating a chosen field of interest, opening your mind, and becoming immersed in materials, mindset, and meaning.
preparation
In order for human-centric design to work, ________ must be based on honest, rational, and emotional observation.
problem definition
According to the text, designing for other people means building a ________.
prototype, which is the fourth step
In order for an idea to become a recognized opportunity, there must be significant market demand, significant structure and size, and ________.
significant margins and resources
In order to determine if it is the right time to start a new business, aspiring entrepreneurs must consider the existence of which of the following criteria?
significant market demand, significant market size, and significant resources
Which of the following improve the performance of established products through characteristics that mainstream customers adopt?
sustaining technologies
Brainstorming creatively means going beyond ________.
the common basic whiteboard scribbling
The Six Thinking Hats exercise is not always easy to implement. If members cannot follow the rules, ________.
the process breaks down
An opportunity-identifying perspective determines how a problem can be translated into a new opportunity to create a new venture.
true
Demographics include statistical factors of a population, including age, race, and gender.
true
Entrepreneurs who focus both on beta testing and market research for their products are more likely to succeed.
true
Job creation may be considered a financial measure of value.
true
Late-stage entrepreneurial failures rates are similar to those of early-stage startups, often due to never achieving traction or growing too quickly.
true
Some entrepreneurial businesses end up adjusting their leadership ethos as their company grows.
true
The notion of the inventor's single stroke of genius is mostly myth.
true
United States venture capitalists have contributed more money than European and Chinese deals combined.
true
When an inventor becomes a successful entrepreneur by launching and selling products based on their inventions, they may also be considered to be an innovator as well.
true
Which of the following is an example of due diligence performed by an entrepreneur?
understanding the process of starting and funding the venture
Where do founders derive their company's mission?
values, beliefs, and experience
How does an entrepreneur create a unique value proposition?
Find the intersection between customer problems and your solution
According to the required Penn State Video on Feasibility Analysis, which of the following is not a component of a market analysis?
Inputs Analysis
Immigrants are half as likely to start a business as native-born Americans.
False
What are the correct steps of the entrepreneurial journey?
Inspiration, Preparation, Assessment, Exploring Resources, Business Plan, Navigation, Launch
Creators
Make something new or see a problem that other people have not noticed
Why is the initial decision about the entity selection so important?
The business may have the potential to evolve into a much larger business
Why should the focus first be on the right side of the business model canvas?
These are the most critical aspects of starting a new venture
The business model, at the very least, must include revenue streams, a value proposition, and customer segments.
True
Which of the following is the most common business model and involves one-sided actors?
direct
entrepreneur
someone who identifies and acts on an idea or problem that no one else has identified or acted on.
Which of the following is not an example of a lifestyle venture?
starting a fashioned focused eyeglass company
Expanders and scalers
Seek out opportunities to expand upon previously created methods, processes, or products
Which business structure operates as a separate legal entity apart from the owners?
corporation
Which type of canvas is most typically used by entrepreneurs?
lean canvas
Lifestyle venture
has evolved to mean a business in which the founders' primary focus is the lifestyle they will attain through becoming entrepreneurs, rather than a primary interest in financial rewards through the selling of the business.
How is a joint venture different from a legal partnership?
Joint ventures are used during a limited period of time and for a single purpose
All of the following except ________ describe entrepreneurs.
corporate sponsors
Entrepreneurs launch only for-profit ventures.
false
Which is the most pragmatic way to plan a venture?
pursuing an existing franchise license
What is the most important aspect of the preparation step?
research and gathering knowledge
Which of the following is a key characteristic that encourages entrepreneurship?
support for freedom to innovate
