25) Which of the following could be considered an internal opportunity?
A) Changes in the buying habits of potential customers
B) New technology
C) New competition
D) Foreclosure of homes in the United States
E) An interest or hobby
Learning Obj.: LO 3
AACSB: Analytical thinking
26) The free market system is also called capitalism and is characterized by all of the following
attributes except ________.
A) Individuals and companies may compete for their own economic gains
B) Private property ownership and wealth are permissible
C) Free market forces determine prices
D) Government is expected to help regulate the market
E) All of the above are attributes
Learning Obj.: LO 2
AACSB: Analytical thinking
27) According to the text, which of the following is not a benefit of becoming an entrepreneur?
A) Independence
B) Fame
C) Satisfaction
D) Financial reward
E) Self-esteem
Learning Obj.: LO 2
AACSB: Application of knowledge
28) Which of the following is not a question to ask yourself when considering your long-term
vision?
A) At what age will you retire?
B) Who will take over then?
C) Do you plan to grow the business to a certain size or level of maturity and then sell it?
D) All of the above
E) None of the above
Learning Obj.: LO 2
AACSB: Analytical thinking
7
29) Entrepreneur is a French word that originally meant ________.
A) Someone who owns a business
B) Someone who undertakes any project that entails risk
C) Someone who runs a business
D) Someone who makes financial gains in business
E) Someone who owns, runs, and makes financial gains in business
Learning Obj.: LO 1
AACSB: Analytical thinking
30) The free-market system is also called ________.
A) Capitalism
B) Entrepreneurship
C) Management
D) Governance
E) None of the above
Learning Obj.: LO 2
AACSB: Analytical thinking
31) About one in five new businesses fails in the first eight years.
Learning Obj.: LO 2
AACSB: Application of knowledge
32) A product is something that is intangible.
Learning Obj.: LO 1
AACSB: Reflective thinking
33) Every business idea is an opportunity.
Learning Obj.: LO 3
AACSB: Reflective thinking
34) The Millennial Generation’s definition of success is less individualized than the traditional
concept of success.
Learning Obj.: LO 2
AACSB: Analytical thinking
8
35) A franchise is a consensual relationship between the owner of a trademark, service mark,
trade name, or advertising symbol and an individual or group seeking to use that identification in
a business.
Learning Obj.: LO 3
AACSB: Application of knowledge
36) Voluntary exchange is a transaction between two parties who agree to trade money for a
product or service.
Learning Obj.: LO 2
AACSB: Analytical thinking
37) Robbery is a voluntary exchange.
Learning Obj.: LO 2
AACSB: Analytical thinking
38) It may be against the law to use someone else’s creative ideas as a basis to start your
business.
Learning Obj.: LO 3
AACSB: Reflective thinking
39) The window of opportunity is the length of time you have to get your business idea to your
market.
Learning Obj.: LO 3
AACSB: Analytical thinking
40) One attribute of capitalism is that free market forces determine prices.
Learning Obj.: LO 1
AACSB: Analytical thinking
41) Green Entrepreneurship is another form of social entrepreneurship.
Learning Obj.: LO 2
AACSB: Analytical thinking
9
42) A new version of an existing product is considered an invention.
Learning Obj.: LO 3
AACSB: Reflective thinking
43) Business opportunities are based solely on the external market.
Learning Obj.: LO 3
AACSB: Reflective thinking
44) Threats are defined as all of the negatives that the entrepreneur faces, such as lack of capital
or training, or failure to set up a workable accounting system. These are internal to the
organization.
Learning Obj.: LO 3
AACSB: Analytical thinking
45) A trade-off can be defined as giving up one thing to lose another.
Learning Obj.: LO 4
AACSB: Reflective thinking
46) Discuss how you would create a business opportunity. What are the factors to consider, the
sources of information you would value, changes to take into consideration, and so on? How is
this an opportunity versus an idea?
Learning Obj.: LO 3
AACSB: Reflective thinking
47) If you opened a restaurant, would you be providing a tangible product or an intangible
service? Explain your answer.
Learning Obj.: LO 1
AACSB: Reflective thinking
10
48) Would you apply a product uniqueness or low cost approach for competitive advantage?
How would you apply the approach?
Learning Obj.: LO 3
AACSB: Analytical thinking
49) What would be some of the costs and benefits of becoming an entrepreneur? How would
they affect your life?
Learning Obj.: LO 2
AACSB: Analytical thinking
50) What are the two kinds of social businesses?
Learning Obj.: LO 2
AACSB: Analytical thinking
11