Exam 5: Entrepreneurs and Small Businesses

One of the biggest reasons that small businesses fail is that the owner spent excessive time engaged in formal planning.

________ of all startups fail in two years.

In determining the value of an existing business, one of the potential sources of value is the current owner's goodwill. In this case, goodwill refers to ________.

Regardless of how well or poorly a franchise business is doing, franchisees must give the franchiser a monthly ________.

A disadvantage of buying a franchise is that some franchises do not restrict the location or number of their franchises.

Alex Garcia has an idea for an internet technology business that involves innovative search engine tools. He was referred to an organization that helps startup businesses by offering resources such as administrative services, technical support, and business networking. This type of organization is called ________.

________ are venture capital firms licensed by the Small Business Administration to make equity capital or long-term loans available to small companies.

The government agency whose sole purpose is to cater to the needs of small businesses is ________.

Isaac is a franchise owner of a fast food restaurant. When another franchisee is accused of using artificial meat in its hamburgers, sales at Isaac's franchise location drop dramatically. What disadvantage of franchising is BEST demonstrated by Isaac's situation?

Small businesses are important to the economy because ________.

Because entrepreneurs can hire other people to manage their business for them, they do not need strong leadership skills.

A ________ business is one that has at least 20 percent sales growth per year for five years, starting with a base of at least $100,000.

Rhonda does not know how to go about finding financing for her struggling new business. Which of the following resources would be the BEST place for her to learn more about obtaining financing?

When naming a business, which of the following approaches would NOT be a mistake?

Volunteers from the Service Corp of Retired Executives provide a variety of services to small businesses. However, volunteers do NOT ________.

What is the worst thing that could happen to small business owners who use credit cards as a source of financing?

All of the following are potential benefits of using credit cards to obtain funds for starting a business EXCEPT ________.

Johanna plans on being the sole proprietor of a home-based sales consulting business. Since she will work out of her home, her startup costs should be low. Which type of financing would be BEST for her to use for the start up of her business?

Only 20 percent of small businesses survive after four years of operation.

Maggie wants to start a fine dining restaurant in her town and dreams someday of having a chain of restaurants all over the country. She can be considered a growth entrepreneur because she ________.