Exam 13: Preparing for and Evaluating the Challenges of Growth

Andy Dungy owns a company that makes iPod and iPhone accessories. He is trying to increase his sales, primarily because he knows that increasing production lowers the average cost of each unit produced. The reason for growth illustrated in this example is:

Market leadership occurs when a firm is one of the top ten firms in an industry or niche market in terms of sales volume.

________ means that as the number of employees a firm need increases, it becomes increasingly difficult for it to find the right employees, place them in appropriate positions, and provide adequate supervision.

All businesses have the potential to be aggressive growth firms.

According to the textbook, the toughest decisions regarding business growth are made in the ________ stage of the organizational life cycle.

According to Penrose, managerial services generate new market, product, and service ideas, while entrepreneurial services administer the routine functions of the firm and facilitate the proper execution of new opportunities.

The rate at which a firm is growing on an annual basis is referred to as its:

Economies of scale occur when:

Jessica Martin owns an entertainment company which has increased both its profits and revenues over an extended period of time. Jessica's firm is experiencing:

Terry Wells owns a growing company that makes innovative kitchen appliances. One thing that Terry has to continually work at is to keep enough cash on hand to make sure she has sufficient liquidity to meet her payroll and cover her other short-term obligations. The day-to-day challenge of firm growth this example is referring to is:

________ are(is) generated when increasing production lowers the average cost of each unit produced.

________ are costs that a company incurs whether it sells something or not. ________ are the costs a company incurs as it generates sales.

According to the textbook, there are three issues about business growth that entrepreneurs should appreciate. These issues are:

The author of the book titled "The Theory of the Growth of the Firm," which is referred to in Chapter 13, is:

According to the basic model of firm growth articulated in Chapter 13, the ability to increase managerial services to facilitate growth is not friction free but is constrained and limited. Which of the following selections is not one of the factors that constrains or limits a firm's ability to increase its managerial services?

Which of the following options was not identified in the textbook as an appropriate reason for growth?

Kendell Adams owns a software development company. When he first launched his firm, he was carefully to hire employees who had the experience he was looking for, were good matches for the positions he had available, and could be properly supervised. As Kendell's firm has grown, and his need for employees has increased, he is finding that it is increasing difficult to find employees who have the qualifications he is looking for, are good matches for the positions he has available, and fit within the supervisory framework he has developed. Kendell is dealing with an issue referred to as:

According to the textbook, the businesses that have the potential to grow the fastest over a sustained period of time are ones that:

Business success doesn't always scale.

________ costs are the costs a company incurs as it makes sales.