Question 1

A reason for an entrepreneur to sell a venture is

Accepted Answer

A)  boredom. 
B)  lack of capital. 
C)  age and health. 
D)  all of the above. 
A)  boredom. 
B)  lack of capital. 
C)  age and health. 
D)  all of the above. D

Question 2

Which of the following is not a step in developing a succession strategy?

Accepted Answer

A)  identifying successor qualities 
B)  carrying out the succession plan 
C)  undertaking forcing events 
D)  understanding contextual aspects 
A)  identifying successor qualities 
B)  carrying out the succession plan 
C)  undertaking forcing events 
D)  understanding contextual aspects C

Question 3

The basic rule for privately held businesses is this: The owner should develop a succession plan.

Accepted Answer

A) True 
 B)False  True

Question 4

Which of the following statements about communication between the seller and buyer of a business is recommended?

Accepted Answer

A)  End communication at least ten days prior to signing a buy agreement. 
B)  Communicate with sellers only through proxies. 
C)  Continue communication through the transition to new ownership. 
D)  End communication at the time the buy agreement is signed. 
A)  End communication at least ten days prior to signing a buy agreement. 
B)  Communicate with sellers only through proxies. 
C)  Continue communication through the transition to new ownership. 
D)  End communication at the time the buy agreement is signed.

Question 5

A type of successor who is interested in efficiency, internal control, and effective use of resources would be considered a(n)

Accepted Answer

A)  managerial successor. 
B)  entrepreneurial successor. 
C)  opportunistic successor. 
D)  family successor. 
A)  managerial successor. 
B)  entrepreneurial successor. 
C)  opportunistic successor. 
D)  family successor.

Question 6

Which is an influencing factor in succession?

Accepted Answer

A)  family and business cultural issues 
B)  government regulation 
C)  current economic conditions 
D)  the competition 
A)  family and business cultural issues 
B)  government regulation 
C)  current economic conditions 
D)  the competition

Question 7

The average life expectancy of a privately held firm is

Accepted Answer

A)  24 years. 
B)  10 years. 
C)  and indefinite number of years. 
D)  50 years. 
A)  24 years. 
B)  10 years. 
C)  and indefinite number of years. 
D)  50 years.

Question 8

Some entrepreneurs are easy to replace, and some cannot be replaced.

Accepted Answer

A) True 
 B)False

Question 9

One of the most recent legal challenges to management succession came from the

Accepted Answer

A)  Anderson Manufacturing Corporation case. 
B)  Johnson Brothers case. 
C)  Oakland Scavenger Company case. 
D)  Willy & Willy Inc. case. 
A)  Anderson Manufacturing Corporation case. 
B)  Johnson Brothers case. 
C)  Oakland Scavenger Company case. 
D)  Willy & Willy Inc. case.

Question 10

Each of the following are nonfamily elements under pressure and interest from outside the firm except

Accepted Answer

A)  increased insurance rates. 
B)  the competition changing strategy. 
C)  regulatory agencies. 
D)  customers. 
A)  increased insurance rates. 
B)  the competition changing strategy. 
C)  regulatory agencies. 
D)  customers.

Question 11

Only ten percent of all privately held enterprises make it to a third generation.

Accepted Answer

A) True 
 B)False

Question 12

Promotion from within is

Accepted Answer

A)  seldom effective. 
B)  usually a bad idea. 
C)  a morale-building philosophy. 
D)  a sure way to measure profitability. 
A)  seldom effective. 
B)  usually a bad idea. 
C)  a morale-building philosophy. 
D)  a sure way to measure profitability.

Question 13

A type of successor who is high in ingenuity, creativity, and drive would be considered a(n)

Accepted Answer

A)  managerial successor. 
B)  entrepreneurial successor. 
C)  opportunistic successor. 
D)  all of the above. 
A)  managerial successor. 
B)  entrepreneurial successor. 
C)  opportunistic successor. 
D)  all of the above.

Question 14

An exit strategy is defined as that component of the business plan where an entrepreneur describes a method by which investors can realize a tangible return on their investment.

Accepted Answer

A) True 
 B)False

Question 15

Harvest strategies rarely involve the complete sale of a business.

Accepted Answer

A) True 
 B)False

Question 16

Succession pressure inside the firm exists

Accepted Answer

A)  when the founder wants to give up authority. 
B)  when family members want to keep and manage the business. 
C)  nonfamily employees don't want the business. 
D)  competition-is hurting the business. 
A)  when the founder wants to give up authority. 
B)  when family members want to keep and manage the business. 
C)  nonfamily employees don't want the business. 
D)  competition-is hurting the business.

Question 17

Research shows that many privately held firms go out of business within

Accepted Answer

A)  one year. 
B)  25 years. 
C)  two years. 
D)  10 years. 
A)  one year. 
B)  25 years. 
C)  two years. 
D)  10 years.

Question 18

The managerial successor typically is not interested in

Accepted Answer

A)  efficiency. 
B)  internal control. 
C)  effective use of resources. 
D)  creativity. 
A)  efficiency. 
B)  internal control. 
C)  effective use of resources. 
D)  creativity.

Question 19

Besides the eight steps in the harvest strategy, the other implications that the entrepreneur should be aware of when selling out are

Accepted Answer

A)  tax implications arising from the sale of a business. 
B)  interest implications arising from the sale of a business. 
C)  security interests arising from the sale of a business. 
D)  home improvement implications arising from the sale of a business. 
A)  tax implications arising from the sale of a business. 
B)  interest implications arising from the sale of a business. 
C)  security interests arising from the sale of a business. 
D)  home improvement implications arising from the sale of a business.

Question 20

Which of the following is a True statement about seeking legal advice with respect to succession planning?

Accepted Answer

A)  Legal advice is seldom beneficial. 
B)  Legal advice from an advisor who understands succession issues is always crucial. 
C)  It is seldom crucial for legal advisors to design a plan for succession. 
D)  The more you pay, the better the advice. 
A)  Legal advice is seldom beneficial. 
B)  Legal advice from an advisor who understands succession issues is always crucial. 
C)  It is seldom crucial for legal advisors to design a plan for succession. 
D)  The more you pay, the better the advice.

A reason for an entrepreneur to sell a venture is

Which of the following is not a step in developing a succession strategy?

The basic rule for privately held businesses is this: The owner should develop a succession plan.

Which of the following statements about communication between the seller and buyer of a business is recommended?

A type of successor who is interested in efficiency, internal control, and effective use of resources would be considered a(n)

Which is an influencing factor in succession?

The average life expectancy of a privately held firm is

Some entrepreneurs are easy to replace, and some cannot be replaced.

One of the most recent legal challenges to management succession came from the

Each of the following are nonfamily elements under pressure and interest from outside the firm except

Only ten percent of all privately held enterprises make it to a third generation.

Promotion from within is

A type of successor who is high in ingenuity, creativity, and drive would be considered a(n)

An exit strategy is defined as that component of the business plan where an entrepreneur describes a method by which investors can realize a tangible return on their investment.

Harvest strategies rarely involve the complete sale of a business.

Succession pressure inside the firm exists

Research shows that many privately held firms go out of business within

The managerial successor typically is not interested in

Besides the eight steps in the harvest strategy, the other implications that the entrepreneur should be aware of when selling out are

Which of the following is a True statement about seeking legal advice with respect to succession planning?

Entrepreneurship: Evolutionary Development-Revolutionary Impact

The Entrepreneurial Mind-Set in Individuals: Cognition and Ethics

The Entrepreneurial Mind-Set in Organizations: Corporate Entrepreneurship

Social Entrepreneurship and the Global Environment for Entrepreneurship

Innovation: The Creative Pursuit of Ideas

Assessment of Entrepreneurial Opportunities

Pathways to Entrepreneurial Ventures

Sources of Capital for Entrepreneurs

Legal Challenges of Entrepreneurial Ventures

Marketing Challenges for Entrepreneurial Ventures

Financial Preparation for Entrepreneurial Ventures

Developing an Effective Business Plan

Strategic Entrepreneurial Growth

Valuation of Entrepreneurial Ventures

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Exam 15: Harvesting the Entrepreneurial Venture

A reason for an entrepreneur to sell a venture is

Which of the following is not a step in developing a succession strategy?

The basic rule for privately held businesses is this: The owner should develop a succession plan.

Which of the following statements about communication between the seller and buyer of a business is recommended?

A type of successor who is interested in efficiency, internal control, and effective use of resources would be considered a(n)

Which is an influencing factor in succession?

The average life expectancy of a privately held firm is

Some entrepreneurs are easy to replace, and some cannot be replaced.

One of the most recent legal challenges to management succession came from the

Each of the following are nonfamily elements under pressure and interest from outside the firm except

Only ten percent of all privately held enterprises make it to a third generation.

Promotion from within is

A type of successor who is high in ingenuity, creativity, and drive would be considered a(n)

An exit strategy is defined as that component of the business plan where an entrepreneur describes a method by which investors can realize a tangible return on their investment.

Harvest strategies rarely involve the complete sale of a business.

Succession pressure inside the firm exists

Research shows that many privately held firms go out of business within

The managerial successor typically is not interested in

Besides the eight steps in the harvest strategy, the other implications that the entrepreneur should be aware of when selling out are

Which of the following is a True statement about seeking legal advice with respect to succession planning?

Entrepreneurship: Evolutionary Development-Revolutionary Impact

The Entrepreneurial Mind-Set in Individuals: Cognition and Ethics

The Entrepreneurial Mind-Set in Organizations: Corporate Entrepreneurship

Social Entrepreneurship and the Global Environment for Entrepreneurship

Innovation: The Creative Pursuit of Ideas

Assessment of Entrepreneurial Opportunities

Pathways to Entrepreneurial Ventures

Sources of Capital for Entrepreneurs

Legal Challenges of Entrepreneurial Ventures

Marketing Challenges for Entrepreneurial Ventures

Financial Preparation for Entrepreneurial Ventures

Developing an Effective Business Plan

Strategic Entrepreneurial Growth

Valuation of Entrepreneurial Ventures

Filters