Question 1

A(n)________ offers the company expertise that a new business owner does not possess in exchange for a share in its profits and liabilities.

Accepted Answer

A) partner 
B) angel investor 
C) advisory board 
D) stockholder 
A) partner 
B) angel investor 
C) advisory board 
D) stockholder

Question 2

Which of the following is the BEST example of entrepreneurial innovation?

Accepted Answer

A) launching the first Starbucks store 
B) opening a new landscaping business 
C) buying a McDonald's franchise 
D) providing financing for a startup business 
A) launching the first Starbucks store 
B) opening a new landscaping business 
C) buying a McDonald's franchise 
D) providing financing for a startup business

Question 3

The Service Corp of Retired Executives is composed of ________ who can provide advice to small business owners.

Accepted Answer

A) part-time employees 
B) full-time employees 
C) freelance executives 
D) volunteers 
A) part-time employees 
B) full-time employees 
C) freelance executives 
D) volunteers

Question 4

Rashan has been working as a pharmacist at a large drug store chain. He would like to open his own small pharmacy but is not sure if he could be successful given the predominance of large competitors. What part of his business plan would best address his concern?

Accepted Answer

A) company information 
B) risk analysis 
C) marketing plan 
D) operational plan 
A) company information 
B) risk analysis 
C) marketing plan 
D) operational plan

Question 5

Which of the following is a potential disadvantage of teaming up with a business partner?

Accepted Answer

A) A partner is able to offer only financial help, not practical advice. 
B) A partner gains full control of the business's decision-making process. 
C) A partner expects a share of the business profits. 
D) A partner is not responsible for any of a business's liabilities. 
A) A partner is able to offer only financial help, not practical advice. 
B) A partner gains full control of the business's decision-making process. 
C) A partner expects a share of the business profits. 
D) A partner is not responsible for any of a business's liabilities.

Question 6

When borrowing money from friends or family members, you should ________.

Accepted Answer

A) ask for more money than you think you will need so that you have room to negotiate, recognizing that if they give all that you ask for you do not need to accept all of it 
B) provide the person from whom you borrowed money a document indicating how and when you intend to pay them back 
C) ask the person from whom you borrow money for advice about how to run your business since they obviously know how to make money 
D) provide the person from whom you borrow money a monthly financial report and budget and always ask their opinions before making business decisions 
A) ask for more money than you think you will need so that you have room to negotiate, recognizing that if they give all that you ask for you do not need to accept all of it 
B) provide the person from whom you borrowed money a document indicating how and when you intend to pay them back 
C) ask the person from whom you borrow money for advice about how to run your business since they obviously know how to make money 
D) provide the person from whom you borrow money a monthly financial report and budget and always ask their opinions before making business decisions

Question 7

Many e-commerce businesses failed in the late 1990s because ________.

Accepted Answer

A) their online stores were a source of identity fraud 
B) they were owned by young entrepreneurs 
C) there was an economic decline called the "dot-com bust" 
D) they did not plan for rapid growth and lacked sufficient inventory to fulfill orders 
A) their online stores were a source of identity fraud 
B) they were owned by young entrepreneurs 
C) there was an economic decline called the "dot-com bust" 
D) they did not plan for rapid growth and lacked sufficient inventory to fulfill orders

Question 8

Which statement BEST describes why a successful entrepreneur needs to be flexible?

Accepted Answer

A) Starting a new business often leads to envy in the wider business community. 
B) People with whom entrepreneurs work are often opinionated and rigid. 
C) Entrepreneurial ventures involve risky situations and unexpected events. 
D) Initial business revenues tend to be low and may remain low for several years. 
A) Starting a new business often leads to envy in the wider business community. 
B) People with whom entrepreneurs work are often opinionated and rigid. 
C) Entrepreneurial ventures involve risky situations and unexpected events. 
D) Initial business revenues tend to be low and may remain low for several years.

Question 9

Which of the following questions would provide the BEST information to help you decide whether or not to buy a business?

Accepted Answer

A) Why did the current owner start the business? 
B) Why is the business for sale? 
C) What are the demographics of the current customer base? 
D) How is employee morale? 
A) Why did the current owner start the business? 
B) Why is the business for sale? 
C) What are the demographics of the current customer base? 
D) How is employee morale?

Question 10

The most common factor that contributes to the failure of a small business is that the business has taken on too much debt.

Accepted Answer

A) True 
 B)False

Question 11

Before Fred started a new business venture, he weighed the factors that could help him succeed as well as the difficulties or setbacks he might face. Which characteristic of a successful entrepreneur is Fred demonstrating?

Accepted Answer

A) systems thinking 
B) motivation 
C) discomfort with uncertainty 
D) calculated risk taking 
A) systems thinking 
B) motivation 
C) discomfort with uncertainty 
D) calculated risk taking

Question 12

A franchise is a method of doing business in which ________.

Accepted Answer

A) an entrepreneur sets up and manages a small business based on an innovative idea or product 
B) a company's products or services are sold to independent third-party operators under the company's name 
C) a company buys ownership of another company and absorbs its employees and customer base into its own structure 
D) a business is able to achieve rapid sales growth in the service sector due to taking advantage of many advertising opportunities 
A) an entrepreneur sets up and manages a small business based on an innovative idea or product 
B) a company's products or services are sold to independent third-party operators under the company's name 
C) a company buys ownership of another company and absorbs its employees and customer base into its own structure 
D) a business is able to achieve rapid sales growth in the service sector due to taking advantage of many advertising opportunities

Question 13

Small businesses are important to the economy because they account for more than 90 percent of America's economic output.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following BEST explains why small businesses can be so effective in fostering innovation?

Accepted Answer

A) SBA's venture capital program provides funding needed for rapid new product development. 
B) Entrepreneurs typically prefer to work in small businesses rather than large ones. 
C) Employees of small businesses tend to be more creative than those of large businesses. 
D) Small business' flexibility allows them to react quickly to changing market needs and trends. 
A) SBA's venture capital program provides funding needed for rapid new product development. 
B) Entrepreneurs typically prefer to work in small businesses rather than large ones. 
C) Employees of small businesses tend to be more creative than those of large businesses. 
D) Small business' flexibility allows them to react quickly to changing market needs and trends.

Question 15

Which of the following does a franchise company offer to people who want to start a business?

Accepted Answer

A) creative control and flexibility 
B) lower initial costs than when starting a business from scratch 
C) guaranteed freedom from local competition 
D) marketing and financial tools to run a business 
A) creative control and flexibility 
B) lower initial costs than when starting a business from scratch 
C) guaranteed freedom from local competition 
D) marketing and financial tools to run a business

Question 16

Entrepreneurs may be motivated to succeed in order to take care of their families.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following is NOT true of business incubators?

Accepted Answer

A) Some business incubators have been started by cities in developing countries. 
B) Some business incubators have been started by universities. 
C) Some business incubators have been started by the Small Business Administration. 
D) Some business incubators have been started by private individuals or organizations. 
A) Some business incubators have been started by cities in developing countries. 
B) Some business incubators have been started by universities. 
C) Some business incubators have been started by the Small Business Administration. 
D) Some business incubators have been started by private individuals or organizations.

Question 18

Amy is the founder of a small IT firm that specializes in social networking applications. She meets weekly with the members of her development team to solicit their ideas, address any problems they are having, and provide motivation and encouragement. Amy is demonstrating which characteristic of a successful entrepreneur?

Accepted Answer

A) risk-taking and financial thinking 
B) leadership and communication skills 
C) introversion and intellectual capacity 
D) technical skills and expertise 
A) risk-taking and financial thinking 
B) leadership and communication skills 
C) introversion and intellectual capacity 
D) technical skills and expertise

Question 19

Janet planned to purchase a McDonald's franchise. Meanwhile, Jason decided to open his own sandwich shop. Both decided to finance their new business ventures by applying for bank loans. Janet's loan application was approved, but Jason's was denied. Which of the following is the most likely explanation for these results?

Accepted Answer

A) Banks view franchises as having fewer risks than other startup businesses. 
B) Banks can charge higher interest rates when financing franchisees. 
C) Banks consider women business owners to present fewer risks than those who are men. 
D) Banks prefer to lend to companies that have the potential of a public stock offering. 
A) Banks view franchises as having fewer risks than other startup businesses. 
B) Banks can charge higher interest rates when financing franchisees. 
C) Banks consider women business owners to present fewer risks than those who are men. 
D) Banks prefer to lend to companies that have the potential of a public stock offering.

Question 20

All of the following are reasons why people start small businesses EXCEPT ________.

Accepted Answer

A) financial independence 
B) reduced levels of responsibility 
C) more control of business decisions 
D) lack of other employment opportunities 
A) financial independence 
B) reduced levels of responsibility 
C) more control of business decisions 
D) lack of other employment opportunities

A(n)________ offers the company expertise that a new business owner does not possess in exchange for a share in its profits and liabilities.

Which of the following is the BEST example of entrepreneurial innovation?

The Service Corp of Retired Executives is composed of ________ who can provide advice to small business owners.

Rashan has been working as a pharmacist at a large drug store chain. He would like to open his own small pharmacy but is not sure if he could be successful given the predominance of large competitors. What part of his business plan would best address his concern?

Which of the following is a potential disadvantage of teaming up with a business partner?

When borrowing money from friends or family members, you should ________.

Many e-commerce businesses failed in the late 1990s because ________.

Which statement BEST describes why a successful entrepreneur needs to be flexible?

Which of the following questions would provide the BEST information to help you decide whether or not to buy a business?

The most common factor that contributes to the failure of a small business is that the business has taken on too much debt.

Before Fred started a new business venture, he weighed the factors that could help him succeed as well as the difficulties or setbacks he might face. Which characteristic of a successful entrepreneur is Fred demonstrating?

A franchise is a method of doing business in which ________.

Small businesses are important to the economy because they account for more than 90 percent of America's economic output.

Which of the following BEST explains why small businesses can be so effective in fostering innovation?

Which of the following does a franchise company offer to people who want to start a business?

Entrepreneurs may be motivated to succeed in order to take care of their families.

Which of the following is NOT true of business incubators?

All of the following are reasons why people start small businesses EXCEPT ________.

Business in the United States

Economics and Banking

Ethics and Social Responsibility

Business in a Global Economy

Forms of Business Ownership

Functions and Skills of Management

Motivation, Leadership, and Teamwork

Human Resources and Labor Relations

Business Technology: Management Information Systems

Production and Operations Management

Marketing and Consumer Behavior

Product Development and Pricing Strategies

Promotion and Distribution

Financing and Tracking Business Operations

Securities and Investments

Mini E-Commerce

Mini Constructing a Successful Business Plan

Mini Business Communications

Mini Finding Employment

Mini Personal Finance

Filters

Exam 5: Entrepreneurs and Small Businesses

A(n)________ offers the company expertise that a new business owner does not possess in exchange for a share in its profits and liabilities.

Which of the following is the BEST example of entrepreneurial innovation?

The Service Corp of Retired Executives is composed of ________ who can provide advice to small business owners.

Rashan has been working as a pharmacist at a large drug store chain. He would like to open his own small pharmacy but is not sure if he could be successful given the predominance of large competitors. What part of his business plan would best address his concern?

Which of the following is a potential disadvantage of teaming up with a business partner?

When borrowing money from friends or family members, you should ________.

Many e-commerce businesses failed in the late 1990s because ________.

Which statement BEST describes why a successful entrepreneur needs to be flexible?

Which of the following questions would provide the BEST information to help you decide whether or not to buy a business?

The most common factor that contributes to the failure of a small business is that the business has taken on too much debt.

Before Fred started a new business venture, he weighed the factors that could help him succeed as well as the difficulties or setbacks he might face. Which characteristic of a successful entrepreneur is Fred demonstrating?

A franchise is a method of doing business in which ________.

Small businesses are important to the economy because they account for more than 90 percent of America's economic output.

Which of the following BEST explains why small businesses can be so effective in fostering innovation?

Which of the following does a franchise company offer to people who want to start a business?

Entrepreneurs may be motivated to succeed in order to take care of their families.

Which of the following is NOT true of business incubators?

All of the following are reasons why people start small businesses EXCEPT ________.

Business in the United States

Economics and Banking

Ethics and Social Responsibility

Business in a Global Economy

Forms of Business Ownership

Functions and Skills of Management

Motivation, Leadership, and Teamwork

Human Resources and Labor Relations

Business Technology: Management Information Systems

Production and Operations Management

Marketing and Consumer Behavior

Product Development and Pricing Strategies

Promotion and Distribution

Financing and Tracking Business Operations

Securities and Investments

Mini E-Commerce

Mini Constructing a Successful Business Plan

Mini Business Communications

Mini Finding Employment

Mini Personal Finance

Filters