Question 1

Success in running a business depends on knowing your customers, managing your employees, and keeping efficient records.

Accepted Answer

A) True 
 B)False

Question 2

Long-motivated by his wish to operate his own business, Andrew is considering purchasing an existing business. As he carefully weighs this option, he is likely to find that

Accepted Answer

A)  very few owners of small businesses have any interest in selling. 
B)  his potential for success would greatly improve if he started his own new firm. 
C)  the value of an existing business is determined by what the business owns, what it earns, and what makes it unique. 
D)  any entrepreneur willing to sell his/her business is experiencing serious financial problems. 
A)  very few owners of small businesses have any interest in selling. 
B)  his potential for success would greatly improve if he started his own new firm. 
C)  the value of an existing business is determined by what the business owns, what it earns, and what makes it unique. 
D)  any entrepreneur willing to sell his/her business is experiencing serious financial problems.

Question 3

Elise recently quit her job at a well-known insurance company and started a home-based business preparing medical transcriptions for doctors. Based on recent statistics, she can expect

Accepted Answer

A)  a negative reaction from friends and family who wonder when she will get a real job. 
B)  the emergence of affordable technology will make it less challenging for her to compete with larger firms offering the same service. 
C)  the government will discourage her attempts to create a home-based business in the hopes that she will opt for locating in an enterprise zone. 
D)  to find security, routine, and a paycheck from her new enterprise. 
A)  a negative reaction from friends and family who wonder when she will get a real job. 
B)  the emergence of affordable technology will make it less challenging for her to compete with larger firms offering the same service. 
C)  the government will discourage her attempts to create a home-based business in the hopes that she will opt for locating in an enterprise zone. 
D)  to find security, routine, and a paycheck from her new enterprise.

Question 4

Business plans are necessarily a bit vague since these are prepared prior to the beginning of business operations.

Accepted Answer

A) True 
 B)False

Question 5

The U.S. government's Immigration Act of 1990

Accepted Answer

A)  encouraged entrepreneurs to come to the U.S. through "investor visas." 
B)  established a government program to teach American workers displaced by immigration how to start their own businesses. 
C)  established guidelines to help entrepreneurs recruit legal aliens as a source of low-cost labor. 
D)  proposed an exchange program for American and European entrepreneurs to temporarily live internationally in order to open up foreign branches for their businesses. 
A)  encouraged entrepreneurs to come to the U.S. through "investor visas." 
B)  established a government program to teach American workers displaced by immigration how to start their own businesses. 
C)  established guidelines to help entrepreneurs recruit legal aliens as a source of low-cost labor. 
D)  proposed an exchange program for American and European entrepreneurs to temporarily live internationally in order to open up foreign branches for their businesses.

Question 6

Which of the following statements explains one of the reasons that people in the U.S. take the entrepreneurial challenge?

Accepted Answer

A)  It's all about profits, and the chance to make a lot of money. 
B)  It's about independence and the opportunity to share in the American dream. 
C)  It's about power and fame. 
D)  It's about a lot of things, but it does not include personal achievement. 
A)  It's all about profits, and the chance to make a lot of money. 
B)  It's about independence and the opportunity to share in the American dream. 
C)  It's about power and fame. 
D)  It's about a lot of things, but it does not include personal achievement.

Question 7

Entrepreneurs avoid risk and place a high priority on security.

Accepted Answer

A) True 
 B)False

Question 8

Angelina recently left her job at a large corporation to start her own business. She knows that her decision comes with risk, but she is excited to be her own boss and to tackle the challenges that running her own company will bring. Angelina is an example of a(n)

Accepted Answer

A)  intrapreneur. 
B)  entrepreneur. 
C)  venture capitalist. 
D)  raconteur. 
A)  intrapreneur. 
B)  entrepreneur. 
C)  venture capitalist. 
D)  raconteur.

Question 9

Bad luck is the most often reported cause for small business failure.

Accepted Answer

A) True 
 B)False

Question 10

Only about 10% of all businesses qualify as small businesses using the definition of the Small Business Administration.

Accepted Answer

A) True 
 B)False

Question 11

Elliot's long-time interest in and knowledge of computers enabled him to design a new hard drive that is better than anything else on the market. Elliot's product and business plan will likely attract several sources of financing if he is willing to give up part ownership in his company.

Accepted Answer

A) True 
 B)False

Question 12

When starting a small business, it's important to remember

Accepted Answer

A)  an affinity for taking large amounts of risk is the critical factor in achieving small business success. 
B)  doing things differently from previous entrepreneurs is the real key to success. 
C)  learning from others and gaining relevant business experience improves the odds for success. 
D)  to avoid burnout, limit the number of hours you work each week as you adapt to the rigors of self-employment. 
A)  an affinity for taking large amounts of risk is the critical factor in achieving small business success. 
B)  doing things differently from previous entrepreneurs is the real key to success. 
C)  learning from others and gaining relevant business experience improves the odds for success. 
D)  to avoid burnout, limit the number of hours you work each week as you adapt to the rigors of self-employment.

Question 13

Successful small business owners are

Accepted Answer

A)  not good sources for information on starting your own business because they generally do not understand failure. 
B)  valuable sources for information since you can learn from their experiences. 
C)  good sources of information but risky since their keen sense of sniffing out something with potential will tempt them to steal your ideas. 
D)  valuable sources of information, but you should proceed with caution because talking with someone who could eventually be your competitor may cross the line due to federal trade commission laws. 
A)  not good sources for information on starting your own business because they generally do not understand failure. 
B)  valuable sources for information since you can learn from their experiences. 
C)  good sources of information but risky since their keen sense of sniffing out something with potential will tempt them to steal your ideas. 
D)  valuable sources of information, but you should proceed with caution because talking with someone who could eventually be your competitor may cross the line due to federal trade commission laws.

Question 14

Tucker is an intrapreneur for a multinational wearable electronics company. Which statement best describes Tucker's duty?

Accepted Answer

A)  He is expected to recruit new managerial talent for his firm. 
B)  He will use the firm's existing resources to develop new products. 
C)  He is concerned mainly with improving the firm's public image. 
D)  He will concentrate on creating new ventures that can be spun off to become independent firms. 
A)  He is expected to recruit new managerial talent for his firm. 
B)  He will use the firm's existing resources to develop new products. 
C)  He is concerned mainly with improving the firm's public image. 
D)  He will concentrate on creating new ventures that can be spun off to become independent firms.

Question 15

One of the challenges of running a home-based business is

Accepted Answer

A)  an increase in business risk. 
B)  managing the extra time on your hands. 
C)  keeping work and family tasks separate. 
D)  burdensome tax laws. 
A)  an increase in business risk. 
B)  managing the extra time on your hands. 
C)  keeping work and family tasks separate. 
D)  burdensome tax laws.

Question 16

If you have managerial skills and leadership ability, you also possess the personality to be an entrepreneur.

Accepted Answer

A) True 
 B)False

Question 17

The principles of management of a large business are similar to the principles of management of a small business.

Accepted Answer

A) True 
 B)False

Question 18

An entrepreneurial team is a group of experienced managers who share the same skills and abilities.

Accepted Answer

A) True 
 B)False

Question 19

Business incubators are usually government-funded facilities intended to

Accepted Answer

A)  provide health care benefits for small business owners and their families. 
B)  offer start-up firms low-cost office space and basic business services. 
C)  help rebuild the nation's infrastructure. 
D)  assist foreign investors in identifying business opportunities in the U.S. 
A)  provide health care benefits for small business owners and their families. 
B)  offer start-up firms low-cost office space and basic business services. 
C)  help rebuild the nation's infrastructure. 
D)  assist foreign investors in identifying business opportunities in the U.S.

Question 20

Compared to small businesses, large firms have a greater ability to provide personalized customer service.

Accepted Answer

A) True 
 B)False

Exam 6: Entrepreneurship and Starting a Small Business

Success in running a business depends on knowing your customers, managing your employees, and keeping efficient records.

Long-motivated by his wish to operate his own business, Andrew is considering purchasing an existing business. As he carefully weighs this option, he is likely to find that

Elise recently quit her job at a well-known insurance company and started a home-based business preparing medical transcriptions for doctors. Based on recent statistics, she can expect

Business plans are necessarily a bit vague since these are prepared prior to the beginning of business operations.

The U.S. government's Immigration Act of 1990

Which of the following statements explains one of the reasons that people in the U.S. take the entrepreneurial challenge?

Entrepreneurs avoid risk and place a high priority on security.

Angelina recently left her job at a large corporation to start her own business. She knows that her decision comes with risk, but she is excited to be her own boss and to tackle the challenges that running her own company will bring. Angelina is an example of a(n)

Bad luck is the most often reported cause for small business failure.

Only about 10% of all businesses qualify as small businesses using the definition of the Small Business Administration.

Elliot's long-time interest in and knowledge of computers enabled him to design a new hard drive that is better than anything else on the market. Elliot's product and business plan will likely attract several sources of financing if he is willing to give up part ownership in his company.

When starting a small business, it's important to remember

Successful small business owners are

Tucker is an intrapreneur for a multinational wearable electronics company. Which statement best describes Tucker's duty?

One of the challenges of running a home-based business is

If you have managerial skills and leadership ability, you also possess the personality to be an entrepreneur.

The principles of management of a large business are similar to the principles of management of a small business.

An entrepreneurial team is a group of experienced managers who share the same skills and abilities.

Business incubators are usually government-funded facilities intended to

Compared to small businesses, large firms have a greater ability to provide personalized customer service.

Taking Risks and Making Profits Within the Dynamic Business Environment

Understanding Economics and How It Affects Business

Doing Business in Global Markets

Demanding Ethical and Socially Responsible Behavior

How to Form a Business

Management and Leadership

Structuring Organizations for Todays Challenges

Production and Operations Management

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Dealing With Employeemanagement Issues

Marketing: Helping Buyers Buy

Developing and Pricing Goods and Services

Distributing Products

Using Effective Promotions

Understanding Accounting and Financial Information

Financial Management

Using Securities Markets for Financing and Investing Opportunities

Money, Financial Institutions, and the Federal Reserve

Working Within the Legal Environment

Using Technology to Manage Information

Managing Risk

Managing Personal Finances

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