Cody Rodgers is the founder of a company named Extreme Sports Apparel. The
company makes apparel products for extreme sports enthusiasts such as rock climbers,
triathletes, skateboarders, and BMX bikers. Cody wants his company to pursue a high
level of corporate entrepreneurship. To achieve that goal, Cody’s firm should be
________.
A) innovative, risk averse, and take a “wait and see” posture
B) taking a “wait and see” posture, innovative, and risk taking
C) proactive, not innovative, and risk taking
D) taking a “wait and see” posture, not innovative, and risk averse
E) proactive, innovative, and risk taking
Answer:
Which of the following statements about pro forma financial statements is incorrect?
A) Pro forma financial statements are projections for future periods based on forecasts.
B) Pro forma financial statements are typically completed for two to three years into the
future.
C) Pro forma financial statements are required by the SEC.
D) Most companies consider their pro forma financial statements to be confidential and
reveal them to outsiders only on a “need to know basis.”
E) Pro forma financial statements are strictly planning tools.
Answer:
If a new firm was launched to help businesses comply with The Affordable Care Act,
that opportunity was created by ________.
A) changes in economic forces
B) demographic changes
C) changes in social forces
D) changes in technological forces
E) political actions and regulatory changes
Answer:
A competitor analysis should be included in the ________ section of a business plan.
A) market analysis
B) industry analysis
C) company description
D) management team and company structure
E) operations plan
Answer:
Market leadership occurs when a firm ________.
A) is the number one or number two firm in an industry or niche market in terms of net
profits
B) is one of the top five firms in an industry or market niche in terms of sales volume
C) earns twice as much as its closest competitor
D) sells twice as much as its closest competitor
E) is the number one or the number two firm in an industry or niche market in terms of
sales volume
Answer:
According to the textbook, the toughest decisions regarding business growth are made
in the ________ stage of the organizational life cycle.
A) introduction
B) early growth
C) continuous growth
D) maturity
E) decline
Answer:
The three primary reasons startups need funding are ________.
A) cash flow challenges, capital investments, and lengthy product development cycles
B) business research, cash flow challenges, and costs associated with building a brand
C) bonuses for members of the new venture team, attorney fees, and lengthy product
development cycles
D) attorney fees, capital investments, and marketing research
E) bonuses for members of the new venture team, marketing research, and personnel
costs
Answer:
Kaitlyn Harris is opening up a women’s fashion boutique that will focus on professional
women that are 18-30 years old. The age range of women that Kaitlyn plans to focus on
is referred to as her ________ market.
A) controlled
B) ambitious
C) identifiable
D) target
E) aspirational
Answer:
Industries that sell products to seniors, such as the eyeglass industry and the hearing aid
industry, are benefiting from the aging of the population, which is an important
________ trend.
A) environmental
B) business
C) commerce
D) statutory
E) competitive
Answer:
Kate Payne was reading the business plan for New Venture Fitness Drinks, and noticed
that prior to its financial statements, New Venture Fitness Drinks placed an explanation
of the sources of the numbers for the statements and the assumptions used to generate
them. This explanation is called a(n) ________.
A) estimate sheet
B) hypothesis sheet
C) assumptions sheet
D) forecast sheet
E) forecast hypothesis
Answer:
The Partnering for Success feature in Chapter 1 focuses on start-up incubators and
accelerators. According to the feature, participating in a start-up incubator or accelerator
is an excellent way to ________.
A) learn how to write a business plan
B) prepare to become a franchisor
C) gain access to mentors, partners and investors
D) learn how to conduct an industry analysis
E) prepare for a job in a major corporation
Answer:
When completing the basis of differentiation box in the Barringer/Ireland Business
Model Template, it is best to limit the description to ________.
A) two to three points
B) one point
C) five to10 points
D) two to three points for manufacturing firms and five to 10 points for service firms
E) five to 10 points for manufacturing firms and two to three points for service firms
Answer:
Which of the following is not one of the five stages in the organizational life cycle?
A) Introduction
B) Early growth
C) Scale
D) Maturity
E) Decline
Answer:
Entrepreneurial firms ________.
A) are small firms that yield a level of income for their owner(s) that is similar to what
they would earn when working for an employer
B) bring to market new products and services that are not particularly innovative
C) offer to customers common products that are not particularly innovative, and provide
their owner(s) the opportunity to pursue a particular lifestyle and earn a living while
doing so
D) provide their owner(s) the opportunity to pursue a particular lifestyle and earn a
living while doing so
E) bring new products and services to market by creating and seizing opportunities
Answer:
According to current regulations, any copyrightable work created on or after January 1,
1978, is protected by copyright law for the life of the author plus ________ years.
A) 5
B) 101
C) 40
D) 55
E) 70
Answer:
Which of the following is not one of the four elements that constitute a firm’s marketing
mix?
A) Price
B) Promotion
C) Passion
D) Place (or distribution)
E) Product
Answer:
Which of the following is not one of the 10 warning signs that a business is growing too
fast?
A) Borrowing money to pay for routine expenses
B) Comfortable operating margins
C) Customer complaints are up.
D) Those working with the business’s financial structure are starting to worry.
E) E-mail and text messages start going unanswered.
Answer:
According to the textbook, the three different types of competitors a business will face
are ________.
A) potential, direct, and upcoming
B) indirect, fleeting, and future
C) serious, cautious, and future
D) direct, indirect, and future
E) potential, fleeting, and indirect
Answer:
There are two primary advantages to buying a franchise over other forms of business
ownership. First, the franchisor typically provides training, technical expertise, and
other forms of support, and second, ________.
A) franchising is almost a sure way of making a profit
B) a franchise agreement is typically easy to exit if expectations aren’t met
C) franchisors typically encourage creativity on the part of franchisees
D) the franchisor provides an entrepreneur the ability to own a business using a tested
and refined business method
E) franchise organizations are consistently more profitable than non- franchise
organizations in the same industry
Answer:
________ growth strategies rely on establishing relationships with third parties, such as
mergers, acquisitions, strategic alliances, joint ventures, licensing, and franchising.
A) Internal
B) Domestic
C) Outside
D) External
E) Peripheral
Answer:
The two primary audiences for a business plan are investors and other external
stakeholders and ________.
A) officials with the SEC
B) a firm’s employees
C) a firm’s competitors
D) a firm’s customers
E) public relations firms
Answer:
Which of the following statements is incorrect regarding the executive summary of a
business plan?
A) It is a short overview of the entire business plan.
B) In many instances an investor will first ask for a copy of a firm’s executive summary
and will request a copy of the full business plan only if the executive summary is
sufficiently convincing.
C) It is arguably the most important section of the business plan.
D) It should not exceed two single-spaced pages.
E) The executive summary is the first thing that should be written in preparing a
business plan.
Answer:
Which of the following is not one of the four major categories in the Barringer/Ireland
Business Model Template?
A) Operations
B) Resources
C) Channels
D) Core strategy
E) Financials
Answer:
Which of the following statements about copyrights is incorrect?
A) Businesses typically possess a treasure trove of copyrightable material.
B) A musical composition that is written down is copyrightable.
C) Copyrightable material may be in tangible or intangible form.
D) The 1976 Copyright Act governs copyright law in the United States.
E) A copyright is a form of intellectual property protection.
Answer:
The two primary issues to consider in organizational feasibility analysis are ________.
A) target market attractiveness and financial rate of return
B) management prowess and resource sufficiency
C) capital requirements and industry attractiveness
D) concept testing and financial rate of return
E) industry attractiveness and overall attractiveness of the investment
Answer:
According to the textbook, Nucor in steel, JetBlue in airlines, and Cirque du Soleil in
circuses are examples of entrepreneurial firms who are exploiting opportunities in
________ industries.
A) fragmented
B) emerging
C) declining
D) global
E) mature
Answer:
Which of the following is incorrect regarding the typical role of consultants in business
startups?
A) Give professional advice
B) International consulting firms (e.g., Accenture and Bearing Point) are financially
beyond the reach of most small firms.
C) Consultants fall into two categoriespaid consultants and consultants who are made
available for free.
D) Give expert advice
E) Help manage the day-to-day activities of the firm
Answer:
The Franchise Disclosure Document is accepted in (or by) ________.
A) 11 states
B) all 50 states, all of Canada, and parts of Mexico
C) 39 states and all of Canada
D) all 50 states and parts of Canada
E) all nations participating in the North America Free Trade Agreement
Answer:
________ marketing is a low-budget approach to marketing that relies on ingenuity,
cleverness, and surprise rather than traditional techniques.
A) Rebel
B) Bug
C) Catching
D) Guerrilla
E) Revolutionary
Answer:
In the context of competitor analysis, businesses that offer identical or similar products
are referred to as ________ competitors.
A) immediate
B) direct
C) indirect
D) straight
E) urgent
Answer:
Which of the following is an example of how to encourage creativity at the
organizational level?
A) Maintain a ‘stiff” organizational culture with no room for different behaviors.
B) Elevate creativity’s importance throughout the organization.
C) Pigeonhole employees; keep them in the same job for years.
D) Make no attempt to hire creative people.
E) Promote a mentality suggesting that the best solutions to all problems have already
been found.
Answer: