Question 1

According to a recent survey, approximately what percentage of all new businesses can be expected to survive their first ten years?

Accepted Answer

A)  16 
B)  23 
C)  31 
D)  46 
E)  52 
A)  16 
B)  23 
C)  31 
D)  46 
E)  52

Question 2

Personal Wellness
Angela has been working for a local small business called Personal Wellness for the last three years. It is a retail business that sells sporting goods equipment. When she started her job, she noticed several things as causes of the business not doing as well as the owners were expecting. Angela has been thinking of starting her own small business because she feels she has learned a great deal through working for Personal Wellness.
Due to her education, attention to detail, and organization skills, Angela's manager asked her to create a business plan for Personal Wellness. The manager hoped that this plan would help organize, structure, and focus the business. As part of the plan, Angela suggested that Personal Wellness contact a group of senior and graduate students to provide management counseling for the company as she is concerned that her leaving the company may be detrimental to the slow, but forward, progress that the company is making and her connection with the owners is strong. Angela's most immediate concern is keeping the business from failing.
-Refer to Personal Wellness. What is the least likely reason that Personal Wellness would possibly fail?

Accepted Answer

A)  Capital 
B)  Employees 
C)  Management 
D)  Money 
E)  Planning 
A)  Capital 
B)  Employees 
C)  Management 
D)  Money 
E)  Planning

Question 3

The main reasons small businesses fail are poor management skills on the part of owners, inadequate capital, and poor planning.

Accepted Answer

A) True 
 B)False

Question 4

John Wells, an African-American small business owner, might be eligible for a grant from the Minority Business Development Agency.

Accepted Answer

A) True 
 B)False

Question 5

Why are more small businesses in distribution industries than in production industries?

Accepted Answer

There are several reasons why more small

Question 6

Mike's small company produces specialized hardware pieces. His industrial clients prefer to purchase these parts from Mike because

Accepted Answer

A)  large companies do not manufacture small parts. 
B)  they cannot produce such high-quality parts. 
C)  it is cheaper to buy from Mike than to make the parts themselves. 
D)  large companies prefer to have less control over their operations. 
E)  buying from Mike will help increase their expenses for tax purposes. 
A)  large companies do not manufacture small parts. 
B)  they cannot produce such high-quality parts. 
C)  it is cheaper to buy from Mike than to make the parts themselves. 
D)  large companies prefer to have less control over their operations. 
E)  buying from Mike will help increase their expenses for tax purposes.

Question 7

About three-quarters of all small businesses are in the service industry.

Accepted Answer

A) True 
 B)False

Question 8

Data from 2012 from the Small Business Administration shows women-owned businesses as a dominate part of the U.S. economy. What were some of the findings of that data? What makes women successful business owners?

Accepted Answer

The data from 2012 from the Small Busine

Question 9

Large companies often find it less expensive to purchase parts from small companies than to manufacture their own.

Accepted Answer

A) True 
 B)False

Question 10

Small-business investment companies

Accepted Answer

A)  are an extension of the SBA. 
B)  are individual, nonprofit organizations. 
C)  are profit-making organizations. 
D)  do not expect a return on their investments. 
E)  make loans to small businesses. 
A)  are an extension of the SBA. 
B)  are individual, nonprofit organizations. 
C)  are profit-making organizations. 
D)  do not expect a return on their investments. 
E)  make loans to small businesses.

Question 11

Michael Tucker operates Tucker Farms in northern Illinois. Last year, his annual receipts were just under $750,000. According to the Small Business Administration, Tucker Farms is a

Accepted Answer

A)  small business. 
B)  medium-sized business. 
C)  large business. 
D)  franchise. 
E)  joint venture. 
A)  small business. 
B)  medium-sized business. 
C)  large business. 
D)  franchise. 
E)  joint venture.

Question 12

Personal Wellness
Angela has been working for a local small business called Personal Wellness for the last three years. It is a retail business that sells sporting goods equipment. When she started her job, she noticed several things as causes of the business not doing as well as the owners were expecting. Angela has been thinking of starting her own small business because she feels she has learned a great deal through working for Personal Wellness.
Due to her education, attention to detail, and organization skills, Angela's manager asked her to create a business plan for Personal Wellness. The manager hoped that this plan would help organize, structure, and focus the business. As part of the plan, Angela suggested that Personal Wellness contact a group of senior and graduate students to provide management counseling for the company as she is concerned that her leaving the company may be detrimental to the slow, but forward, progress that the company is making and her connection with the owners is strong. Angela's most immediate concern is keeping the business from failing.
-Refer to Personal Wellness. When Angela suggested that the company contact a group, what type of group was she referring to?

Accepted Answer

A)  Strategic institute 
B)  Small-business institute 
C)  HR institute 
D)  Management institute 
E)  Business institute 
A)  Strategic institute 
B)  Small-business institute 
C)  HR institute 
D)  Management institute 
E)  Business institute

Question 13

"This business will create a caring, learning environment for elementary school children after regular school hours to meet the needs of working parents." This statement answers which of the following issues that should be addressed in a business plan?

Accepted Answer

A)  How much will the new business cost? 
B)  Why is this new business a good idea? 
C)  What are Cindy's goals for the business? 
D)  What is the nature and mission of the business? 
E)  How often will the business advertise? 
A)  How much will the new business cost? 
B)  Why is this new business a good idea? 
C)  What are Cindy's goals for the business? 
D)  What is the nature and mission of the business? 
E)  How often will the business advertise?

Question 14

Personal Wellness
Angela has been working for a local small business called Personal Wellness for the last three years. It is a retail business that sells sporting goods equipment. When she started her job, she noticed several things as causes of the business not doing as well as the owners were expecting. Angela has been thinking of starting her own small business because she feels she has learned a great deal through working for Personal Wellness.
Due to her education, attention to detail, and organization skills, Angela's manager asked her to create a business plan for Personal Wellness. The manager hoped that this plan would help organize, structure, and focus the business. As part of the plan, Angela suggested that Personal Wellness contact a group of senior and graduate students to provide management counseling for the company as she is concerned that her leaving the company may be detrimental to the slow, but forward, progress that the company is making and her connection with the owners is strong. Angela's most immediate concern is keeping the business from failing.
-Refer to Personal Wellness. In preparing the business plan, Angela would have incorporated all of these components except

Accepted Answer

A)  company and industry descriptions. 
B)  an exit strategy. 
C)  government regulations. 
D)  benefits to the community. 
E)  a marketing plan. 
A)  company and industry descriptions. 
B)  an exit strategy. 
C)  government regulations. 
D)  benefits to the community. 
E)  a marketing plan.

Question 15

Businesses such as flower shops, restaurants, bed and breakfasts, and automobile repair are good candidates for entrepreneurs because they

Accepted Answer

A)  do not require any skills. 
B)  are the most likely to succeed. 
C)  can obtain financing easily. 
D)  require no special equipment. 
E)  have a relatively low initial investment. 
A)  do not require any skills. 
B)  are the most likely to succeed. 
C)  can obtain financing easily. 
D)  require no special equipment. 
E)  have a relatively low initial investment.

Question 16

A small-business investment company (SBIC) is a government agency that provides venture capital to small enterprises.

Accepted Answer

A) True 
 B)False

Question 17

The primary financial function of the Small Business Administration is to

Accepted Answer

A)  lend money. 
B)  guarantee loans. 
C)  find sources of financial aid. 
D)  help owners apply for loans. 
E)  provide aid only when a natural disaster occurs. 
A)  lend money. 
B)  guarantee loans. 
C)  find sources of financial aid. 
D)  help owners apply for loans. 
E)  provide aid only when a natural disaster occurs.

Question 18

The textbook gives several key reasons for business failure. Poorly planned expansion and the wrong location are two of them. How do these two factors contribute to business failure?

Accepted Answer

Poorly planned expansion and the wrong l

Question 19

What are the advantages of owning a small business? Give examples.

Accepted Answer

Owning a small business can have several

Question 20

Janis starts a small quilting and embroidery business. She purchases a technologically advanced quilting machine and an embroidery machine for a combined $25,000. Her monthly payments on the equipment are $500, but she has only one client at this time. Janis is facing a potential

Accepted Answer

A)  inventory flow problem. 
B)  cash-flow problem. 
C)  competitive advantage. 
D)  overexpansion problem. 
E)  advertising issue. 
A)  inventory flow problem. 
B)  cash-flow problem. 
C)  competitive advantage. 
D)  overexpansion problem. 
E)  advertising issue.

Exam 5: Small Business, Entrepreneurship, and Franchises

According to a recent survey, approximately what percentage of all new businesses can be expected to survive their first ten years?

The main reasons small businesses fail are poor management skills on the part of owners, inadequate capital, and poor planning.

John Wells, an African-American small business owner, might be eligible for a grant from the Minority Business Development Agency.

Why are more small businesses in distribution industries than in production industries?

Mike's small company produces specialized hardware pieces. His industrial clients prefer to purchase these parts from Mike because

About three-quarters of all small businesses are in the service industry.

Data from 2012 from the Small Business Administration shows women-owned businesses as a dominate part of the U.S. economy. What were some of the findings of that data? What makes women successful business owners?

Large companies often find it less expensive to purchase parts from small companies than to manufacture their own.

Small-business investment companies

Michael Tucker operates Tucker Farms in northern Illinois. Last year, his annual receipts were just under $750,000. According to the Small Business Administration, Tucker Farms is a

"This business will create a caring, learning environment for elementary school children after regular school hours to meet the needs of working parents." This statement answers which of the following issues that should be addressed in a business plan?

Businesses such as flower shops, restaurants, bed and breakfasts, and automobile repair are good candidates for entrepreneurs because they

A small-business investment company (SBIC) is a government agency that provides venture capital to small enterprises.

The primary financial function of the Small Business Administration is to

The textbook gives several key reasons for business failure. Poorly planned expansion and the wrong location are two of them. How do these two factors contribute to business failure?

What are the advantages of owning a small business? Give examples.

Janis starts a small quilting and embroidery business. She purchases a technologically advanced quilting machine and an embroidery machine for a combined $25,000. Her monthly payments on the equipment are $500, but she has only one client at this time. Janis is facing a potential

Exploring the World of Business and Economics

A: Being Ethical and Socially Responsible

B: Being Ethical and Socially Responsible

A: Exploring Global Business

B: Exploring Global Business

Choosing a Form of Business Ownership

Understanding the Management Process

Creating a Flexible Organization

Producing Quality Goods and Services

Attracting and Retaining the Best Employees

Motivating and Satisfying Employees and Teams

Enhancing Union-Management Relations

Building Customer Relationships Through Effective Marketing

A: Creating and Pricing Products That Satisfy Customers

B: Creating and Pricing Products That Satisfy Customers

Wholesaling, Retailing, and Physical Distribution

Developing Integrated Marketing Communications

Social Media, E-Business, and Accounting

Using Management and Accounting Information

Understanding Money, Banking, and Credit

Mastering Financial Management

A: Understanding Personal Finances and Investments

B: Understanding Personal Finances and Investments

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