Question 1

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

Accepted Answer

A) True 
 B)False

Question 2

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

Question 3

Which of the following statements is TRUE about franchising?

Accepted Answer

A)  Franchisees enjoy guaranteed minimum annual revenues based on their territory. 
B)  Franchisers encourage franchisees to be independent and creative in running their operations. 
C)  Franchisees have relatively lower risk than other small business start-ups. 
D)  Franchisees don't need to pay royalty fees to their franchisers. 
E)  All franchises restrict the location and number of their franchise locations. 
A)  Franchisees enjoy guaranteed minimum annual revenues based on their territory. 
B)  Franchisers encourage franchisees to be independent and creative in running their operations. 
C)  Franchisees have relatively lower risk than other small business start-ups. 
D)  Franchisees don't need to pay royalty fees to their franchisers. 
E)  All franchises restrict the location and number of their franchise locations.

Question 4

What is an entrepreneurial team? Describe the major reasons why an entrepreneurial team might be formed.

Accepted Answer

An entrepreneurial team is a group of qu

Question 5

Gary Smith,owner of a small business in San Diego,heard that the Small Business Administration will hold a series of workshops in his city.Which of the following topics is MOST likely to be included in the Small Business Administration's workshops?

Accepted Answer

A)  creating a business plan 
B)  lobbying 
C)  filing for unemployment 
D)  retirement planning 
E)  mentoring 
A)  creating a business plan 
B)  lobbying 
C)  filing for unemployment 
D)  retirement planning 
E)  mentoring

Question 6

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

Accepted Answer

A)  personal savings 
B)  bank loan 
C)  loan from friends 
D)  venture capitalist 
E)  angel investors 
A)  personal savings 
B)  bank loan 
C)  loan from friends 
D)  venture capitalist 
E)  angel investors

Question 7

Jodi owns a business that designs and creates lingerie.In an effort to get her product into as many stores as possible,Jodi has been lenient on the terms of collection,allowing stores at least 30 days credit.As a result,it is taking her too long to collect payments and her revenues are very low.What is the MOST likely cause of Jodi's business difficulties?

Accepted Answer

A)  Jodi is not developing enough goodwill. 
B)  Jodi is trying to expand her business too rapidly. 
C)  Jodi is not adequately managing the financial aspects of her business. 
D)  Jodi is spending too much of her time on product design. 
E)  Jodi is making her product available at too many locations. 
A)  Jodi is not developing enough goodwill. 
B)  Jodi is trying to expand her business too rapidly. 
C)  Jodi is not adequately managing the financial aspects of her business. 
D)  Jodi is spending too much of her time on product design. 
E)  Jodi is making her product available at too many locations.

Question 8

Which of the following is NOT true of business incubators?

Accepted Answer

A)  Some business incubators are sponsored by counties. 
B)  Some business incubators are run by universities. 
C)  Some business incubators have been started by the Small Business Administration. 
D)  Some business incubators are run by technical schools. 
E)  Some business incubators are sponsored by cities. 
A)  Some business incubators are sponsored by counties. 
B)  Some business incubators are run by universities. 
C)  Some business incubators have been started by the Small Business Administration. 
D)  Some business incubators are run by technical schools. 
E)  Some business incubators are sponsored by cities.

Question 9

Small businesses are important to the economy because ________.

Accepted Answer

A)  they are more innovative than larger companies 
B)  they improve productivity by hiring less-expensive staff in countries outside the United States 
C)  they generate about 65 percent of net new jobs in the United States 
D)  they create more than two-thirds of the U.S. gross domestic product 
E)  they export more than one-half of total U.S. exported goods and services 
A)  they are more innovative than larger companies 
B)  they improve productivity by hiring less-expensive staff in countries outside the United States 
C)  they generate about 65 percent of net new jobs in the United States 
D)  they create more than two-thirds of the U.S. gross domestic product 
E)  they export more than one-half of total U.S. exported goods and services

Question 10

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

Accepted Answer

A) True 
 B)False

Question 11

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

Accepted Answer

A)  financial statement 
B)  marketing plan 
C)  royalty fee 
D)  inventory report 
E)  training update 
A)  financial statement 
B)  marketing plan 
C)  royalty fee 
D)  inventory report 
E)  training update

Question 12

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. 
E)  Small businesses don't need to adhere to all the regulations that larger companies do 
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. 
E)  Small businesses don't need to adhere to all the regulations that larger companies do

Question 13

A ________ is a formal document that states the goals of the business as well as the intended process for reaching those goals.

Accepted Answer

A)  strategy 
B)  business plan 
C)  prospectus 
D)  vision statement 
E)  marketing plan 
A)  strategy 
B)  business plan 
C)  prospectus 
D)  vision statement 
E)  marketing plan

Question 14

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.

Accepted Answer

A)  cheetah 
B)  hyper-growth 
C)  consistent-growth 
D)  gazelle 
E)  enterprise zone 
A)  cheetah 
B)  hyper-growth 
C)  consistent-growth 
D)  gazelle 
E)  enterprise zone

Question 15

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 start-up business 
E)  starting a catering company 
A)  launching the first Starbucks store 
B)  opening a new landscaping business 
C)  buying a McDonald's franchise 
D)  providing financing for a start-up business 
E)  starting a catering company

Question 16

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. 
E)  A partner must take over the role of CEO. 
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. 
E)  A partner must take over the role of CEO.

Question 17

Since Donna was laid off from her job a few months ago,she has enjoyed having more time to relax,exercise,and be with her family.Now she is wondering whether she should start her own business.Donna should consider purchasing a franchise ONLY if she ________.

Accepted Answer

A)  does not have enough capital to start an independent business 
B)  is prepared to handle the heavy workload that comes with a franchise 
C)  wants the protection from competition that the franchiser would provide 
D)  is interested in the products sold by a particular franchise 
E)  requires complete creative control 
A)  does not have enough capital to start an independent business 
B)  is prepared to handle the heavy workload that comes with a franchise 
C)  wants the protection from competition that the franchiser would provide 
D)  is interested in the products sold by a particular franchise 
E)  requires complete creative control

Question 18

Timothy is the 60-year-old founder of a publishing company that has over $2 million in annual gross sales.Is he eligible to have a mentor through the Entrepreneurs Organization?

Accepted Answer

A)  Yes, because his company makes more than $1 million annually. 
B)  Yes, because there are no specific requirements for mentoring. 
C)  No, because he is over 50 years old. 
D)  No, because his company can no longer be considered a start-up. 
E)  No, because his company is not currently a viable operation. 
A)  Yes, because his company makes more than $1 million annually. 
B)  Yes, because there are no specific requirements for mentoring. 
C)  No, because he is over 50 years old. 
D)  No, because his company can no longer be considered a start-up. 
E)  No, because his company is not currently a viable operation.

Question 19

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

Accepted Answer

A)  hiring a company to create a name 
B)  using geographic names 
C)  involving employees or clients in the naming decision 
D)  using a generic name 
E)  using a name that tries to marry description with product 
A)  hiring a company to create a name 
B)  using geographic names 
C)  involving employees or clients in the naming decision 
D)  using a generic name 
E)  using a name that tries to marry description with product

Question 20

What would be the GREATEST advantage of having a partner as opposed to having an advisory board?

Accepted Answer

A)  A partner would be less likely to disagree with the other owner's ideas. 
B)  A partner would be more committed to the success of the business than an advisory board. 
C)  A partner would be able to make decisions that differed from that of the other owner. 
D)  A partner would provide more varied perspectives than that of an advisory board. 
E)  A partner would not be authorized to make decisions. 
A)  A partner would be less likely to disagree with the other owner's ideas. 
B)  A partner would be more committed to the success of the business than an advisory board. 
C)  A partner would be able to make decisions that differed from that of the other owner. 
D)  A partner would provide more varied perspectives than that of an advisory board. 
E)  A partner would not be authorized to make decisions.

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

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 statements is TRUE about franchising?

What is an entrepreneurial team? Describe the major reasons why an entrepreneurial team might be formed.

Gary Smith,owner of a small business in San Diego,heard that the Small Business Administration will hold a series of workshops in his city.Which of the following topics is MOST likely to be included in the Small Business Administration's workshops?

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

Which of the following is NOT true of business incubators?

Small businesses are important to the economy because ________.

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

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

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

A ________ is a formal document that states the goals of the business as well as the intended process for reaching those goals.

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.

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

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

Since Donna was laid off from her job a few months ago,she has enjoyed having more time to relax,exercise,and be with her family.Now she is wondering whether she should start her own business.Donna should consider purchasing a franchise ONLY if she ________.

Timothy is the 60-year-old founder of a publishing company that has over $2 million in annual gross sales.Is he eligible to have a mentor through the Entrepreneurs Organization?

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

What would be the GREATEST advantage of having a partner as opposed to having an advisory board?

Business Basics

Economics and Banking

Ethics in Business

Business in a Global Economy

Forms of Business Ownership

Business Management and Organization

Motivation, Leadership, and Teamwork

Human Resource Management

Online Business and Technology

Production, operations, and the Supply Chain

Marketing and Consumer Behavior

Product Development and Pricing Strategies

Promotion and Distribution

Financing and Tracking Business Operations

Investment Opportunities in the Securities Market

Business Law

Constructing an Effective Business Plan

Business Communications

Finding a Job

Personal Finance

Filters

Exam 5: Small Business and the Entrepreneur

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

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 statements is TRUE about franchising?

What is an entrepreneurial team? Describe the major reasons why an entrepreneurial team might be formed.

Gary Smith,owner of a small business in San Diego,heard that the Small Business Administration will hold a series of workshops in his city.Which of the following topics is MOST likely to be included in the Small Business Administration's workshops?

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

Which of the following is NOT true of business incubators?

Small businesses are important to the economy because ________.

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

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

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

A ________ is a formal document that states the goals of the business as well as the intended process for reaching those goals.

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.

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

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

Since Donna was laid off from her job a few months ago,she has enjoyed having more time to relax,exercise,and be with her family.Now she is wondering whether she should start her own business.Donna should consider purchasing a franchise ONLY if she ________.

Timothy is the 60-year-old founder of a publishing company that has over $2 million in annual gross sales.Is he eligible to have a mentor through the Entrepreneurs Organization?

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

What would be the GREATEST advantage of having a partner as opposed to having an advisory board?

Business Basics

Economics and Banking

Ethics in Business

Business in a Global Economy

Forms of Business Ownership

Business Management and Organization

Motivation, Leadership, and Teamwork

Human Resource Management

Online Business and Technology

Production, operations, and the Supply Chain

Marketing and Consumer Behavior

Product Development and Pricing Strategies

Promotion and Distribution

Financing and Tracking Business Operations

Investment Opportunities in the Securities Market

Business Law

Constructing an Effective Business Plan

Business Communications

Finding a Job

Personal Finance

Filters