Debt financing involves ________.
A) raising venture capital or securing a private placement
B) selling corporate bonds or selling stock via an IPO
C) getting a grant or selling corporate bonds
D) getting a loan or raising venture capital
E) getting a loan or selling corporate bonds
Answer:
Jim Pierce just purchased the rights to develop multiple School of Rock franchises in
Germany. Jim just purchased a(n) ________ franchise arrangement.
A) concurrent
B) indirect
C) lateral
D) direct
E) subordinate
Answer:
According to the textbook, the Comfort Keepers business idea lends itself to franchising
because the ________.
A) company has the ability to grow profitably and has a good trademark
B) company’s business concept is easy to teach and individual Comfort Keeper outlets
are inexpensive to open and operate
C) company has new technology to introduce to the marketplace
D) company has intellectual property and the ability to grow quickly
E) company has a good trademark and a good business method
Answer:
A(n) ________ is a physical or digital repository for storing ideas.
A) suggestion bank
B) idea depository
C) suggestion pool
D) idea bank
E) proposition pool
Answer:
Pam Ryan owns a store that sells running shoes and related products. Pam is currently
trying to increase sales through endorsements by famous runners and former Olympic
athletes. Pam is pursuing a(n) ________ strategy.
A) strategic alliance
B) licensing
C) market penetration
D) geographic expansion
E) improving an existing product or service
Answer:
Which of the financial statements used by businesses to keep track of their financial
affairs is the most similar to an ordinary person’s end-of-the month bank statement?
A) Income statement
B) Balance sheet
C) Statement of cash flows
D) Statement of ratio analysis
E) Statement of owners’ equity
Answer:
In the Barringer/Ireland Business Model Template, a(n) ________ is a specific factor or
capability that supports a firm’s business model and sets it apart from its rivals.
A) primary capability
B) core competency
C) essential asset
D) staple proficiency
E) key aptitude
Answer:
The Partnering for Success feature in Chapter 13 focuses on Threadless, the popular
community-centered T-shirt design site. According to the feature, at one point during its
early growth, Threadless almost collapsed under the weight of operational problems.
Threadless solved the problem by ________.
A) hiring professional managers
B) replacing the founder CEO with a seasoned CEO from an established company
C) hiring a consulting firm
D) selling a minority interest to a venture capital firm, which provided Threadless
operational assistance
E) merging with Zappos and folding its operations into Zappos’ operations
Answer:
According to Chapter 1, a sentiment that venture capitalists often express is that
________.
A) the strength of the entrepreneur and the strength of the business idea are of equal
importance
B) they would never fund a strong entrepreneur with a weak business idea
C) they would rather fund a strong entrepreneur with a mediocre business idea than
fund a strong business idea with a mediocre entrepreneur
D) a new venture’s marketing plan is more important than either the strength of the
entrepreneur or the strength of the business idea
E) they would rather fund a strong business idea with a mediocre entrepreneur than
fund a strong entrepreneur with a mediocre business idea
Answer:
Which of the following statements is incorrect regarding equity funding?
A) Equity investors expect to get their money back, along with a substantial capital
gain, through the sale of their stock.
B) Angel investors are a common source of equity funding.
C) Equity funding is not a loan.
D) Equity investors are very demanding.
E) Equity investors fund the majority of the plans they consider.
Answer:
According to the textbook, the five competitive forces included in the Five Forces
model determine the average ________.
A) rate of new business starts in an industry
B) growth rate for the firms in an industry
C) rate of return for the firms in an industry
D) sales for the firms in an industry
E) failure rate for the firms in an industry
Answer:
Which of the following statements is incorrect regarding the process of building a
company’s brand, particularly for young firms?
A) A firm’s name, logo, Web site design, and even its letterhead are part of its brand.
B) One of the keys to effective branding is to create a strong personality for a firm.
C) Some companies monitor the integrity of their brands through brand management.
D) Startups must build a brand from scratch, which starts with selecting the company’s
name.
E) Most experts recommend a heavy reliance on advertising in building a firm’s brand.
Answer:
The two primary steps involved in finding an appropriate acquisition candidate are (1)
Make a ‘short list” of appropriate acquisition candidates and (2) ________.
A) carefully screen each candidate to determine its suitability for acquisition
B) interview the CEO of each candidate to determine his/her openness to an acquisition
C) determine if acquiring each candidate is financially feasible
D) meet with each candidate’s top management team to discern if they are compatible
with your top management team
E) hire a consulting firm to determine the best acquisition candidate
Answer:
Patent ________ takes place when one party engages in the unauthorized use of another
party’s patent.
A) breach
B) encroachment
C) violation
D) infraction
E) infringement
Answer:
Greenvelope, the company profiled in the opening feature of Chapter 5, believes it has
created sufficient barriers to entry to enable it to maintain a leadership position in the
invitation industry. Its barriers to entry include ________.
A) the price-point of its products, the amount of its funding, the strength of its
management team, and its partnership with a major player in the invitations industry
B) its intellectual property, the strength of its brand, its international presence, and its
access to distribution channels
C) the strength of its brand, its network of freelance designers, its social mission, and
the functionality of its Web site.
D) the innovative nature of its products, its network of freelance designers, the strength
of its management team, and economies of scale
E) its international presence, the price-point of its products, its social mission, and the
innovative nature of its products
Answer:
Which of the following statements is incorrect regarding product and trademark
franchises?
A) Rather than obtaining a royalty or franchise fee, the product and trademark
franchisor obtains the majority of its income from selling its products to its dealers or
distributors at a markup.
B) Ford Motors establishes product trademark rather than business format franchises.
C) Product trademark franchises are more popular than business format franchises.
D) Product and trademark franchisees are typically permitted to operate in a fairly
autonomous manner.
E) A product trademark franchise typically connects a single manufacturer with a
network of dealers or distributors.
Answer:
Consider the following questions: Are products under development that require patent
protection? Are we in compliance with the copyright license agreements into which we
have entered? Is anyone infringing on our trademarks? Are company trade secrets
leaking out to competitors? These are the types of questions that would be asked when
conducting a(n) ________.
A) intangible material examination
B) intellectual property inventory
C) intangible material inspection
D) patent, trademark, copyright, and trade secret review
E) intellectual property audit
Answer:
To test resource sufficiency, a firm should list the ________ most critical non-financial
resources that it will need to move its business idea forward and determine if those
resources are available.
A) 1 to 2
B) 3 to 5
C) 6 to 12
D) 10 to 16
E) 15 to 25
Answer:
If a local band wrote their own rendition of a Katy Perry song, the band could try to
copyright their rendition of the song as a(n) ________ work.
A) imitative
B) offshoot
C) derivative
D) subsequent
E) supplemental
Answer:
A business ________ is an individual who gives professional or expert advice, on a
volunteer or fee basis.
A) consultant
B) intern
C) employee
D) virtual assistant
E) mentor
Answer:
The information that is gathered by a firm to learn about its competitors is referred to as
________.
A) a feasibility appraisal
B) a workable appraisal
C) a practical assessment
D) a viable assessment
E) competitive intelligence
Answer:
The Savvy Entrepreneurial Firm feature in Chapter 1 focuses on Pandora, the Internet
streaming music company. The feature’s main purpose is to illustrate the importance of
________ as a key characteristic of the founders and employees of entrepreneurial
firms.
A) execution intelligence
B) a desire to pursue financial rewards
C) tenacity despite failure
D) passion for the business
E) product/customer focus
Answer:
A(n) ________ is a person who works for a business as an apprentice or trainee for the
purpose of obtaining actual experience.
A) freelancer
B) consultant
C) intern
D) virtual assistant
E) novice
Answer:
For most business plans ________ pages are sufficient.
A) 40 to 50
B) 30 to 40
C) 15 to 20
D) 25 to 35
E) 5 to 10
Answer:
In regard to the stages (or rounds) of venture capital funding, the stage of funding that
occurs when an investment is made very early in a venture’s life to fund the
development of a prototype and feasibility analysis is referred to as ________ funding.
A) seed
B) second-stage
C) first-stage
D) mezzanine
E) startup
Answer:
In an acquisition, the surviving firm is called the ________, and the firm that is
acquired is called the ________.
A) target; acquirer
B) goal; objective
C) objective; aggressor
D) acquirer; target
E) aggressor; objective
Answer:
The Savvy Entrepreneurial Firm feature in Chapter 11 focuses on Airbnb, the company
that created a marketplace for people to list, discover, and book unique spaces in
people’s homes or apartments while traveling. According to the feature, Airbnb was able
to generate substantial buzz about its service via the use of ________.
A) Facebook
B) Google AdSense
C) blogs
D) newspaper ads
E) Twitter
Answer:
According to the textbook, the most important function of the pro forma statement of
cash flows is to project whether the firm will have sufficient ________.
A) income to meet its payroll on a weekly or monthly basis
B) income to exceed industry norms
C) cash to meet its needs
D) inventory to meet its sales and production forecasts
E) short-term assets to cover its short-term liabilities
Answer: