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TRIZ is an acronym for a systematic approach to help solve technical problems based
on the study of hundreds of the most innovative patents.
A feasibility analysis consists of four interrelated components: an industry and market
feasibility analysis, a product or service feasibility analysis, a financial feasibility
analysis, and an entrepreneur feasibility analysis.
Too many entrepreneurs start their business undercapitalized.
An effective marketing program depends on a clear, concise definition of the firm's
target market.
The left brain relies on kaleidoscopic, lateral thinking.
Few other stakeholders are as important to a business as its employees.
In addition to contacting the references a job applicant provides, experienced employers
also call an applicant's previous employers to attempt to get a clear picture of the
applicant's job performance, character, and work habits.
Companies must recognize the independence of business and society.
The net profit on sales ratio measures the owner's rate of return on the investment in the
business.
A business plan ________.
A) is a valuable managerial tool that helps an entrepreneur focus on developing a
course for the business in the future
B) is a valuable tool for convincing lenders or investors to put money into the business
C) forces an entrepreneur to think a business idea through, considering both its positive
and its negative aspects
D) All of the above
In asset-based borrowing, the ________ rate is the percentage of an asset's value that a
lender will lend.
A) prime
B) margin
C) advance
D) discounted
Although there is no limit on the amount of stock it can buy, a typical venture capital
firm will purchase less than ________ percent of the ownership in a small firm.
A) 21
B) 50
C) 70
D) 80
The general trend of angel financing is that it has ________ as a source of capital for
entrepreneurs over the past few years.
A) increased
B) stabilized
C) decreased
D) disappeared
The process in which entrepreneurs test their business models on a small scale before
committing serious resources to launch a business that might not work is known as
________.
A) business modeling
B) business prototyping
C) business planning
D) product or service feasibility analysis
A firm's cash budget should ________.
A) be prepared on a monthly basis for at least one year in advance and cover all
seasonal fluctuations
B) cover a longer planning horizon when a firm's pattern is highly variable
C) show the amount and timing of cash receipts and cash disbursements on an annual
basis
D) show the amount and timing of cash receipts and cash disbursements on a quarterly
basis
Venture capital companies reject 90 percent of the proposals they receive because they
don't meet the firms' investment criteria.
An American executive went to a foreign country to sign a business contract. While
there, she/he found that there were numerous complex government regulations her/his
company needed to meet before closing the deal. This executive was experiencing
which barrier to international trade?
A) Tariff
B) Political
C) Cultural
D) Domestic
When pricing a new product, a small business owner should strive to always satisfy
which three objectives?
A) Product acceptance, maintaining market share, and earning a profit.
B) Quick acceptance, extensive distribution, and quickly recovering costs.
C) Recovering initial development costs, recovering initial promotional costs, and
discouraging competition.
D) Discouraging competition, recovering development costs, and developing a prestige
image.
The FTC's philosophy regarding the Uniform Franchise Disclosure Document (UFDD)
focuses on ________.
A) catching and prosecuting abusers of franchise laws
B) verifying the accuracy of FDD information
C) providing information to prospective franchisees and helping them make wise
decisions
D) licensing prospective franchisors
The value proposition that sets a company apart from its competitors and gives it a
unique position in the market, superior to its competition, is its ________.
A) mission statement
B) competitive advantage
C) competitive profile
D) strategic plan
Analyzing financial ratios could alert a business owner to which of these problems?
A) Excessive inventory
B) Overextending credit
C) Too much debt
D) All of the above
When a company is forced into liquidation, owners are most likely to incur a loss when
selling ________.
A) accounts receivable
B) inventory
C) marketable securities
D) real estate
Which of the following is a disadvantage of the corporation form of ownership?
A) An inability to accumulate capital.
B) The unlimited liability to the members of the board.
C) Double taxation on profits.
D) The lack of continuity.
