Annie Clarke owns a smartphone app development firm. The way Annie prices her
products is to determine what consumers are willing to pay, and then she backs off a bit
to provide a cushion. The method that Annie used to determine her prices is called
________ pricing.
A) predatory
B) technical
C) cost-based
D) competitive-based
E) value-based
Answer:
Which of the following statements about business models is incorrect?
A) There are two general types of business models.
B) There is no perfect business model.
C) Most of the standard business models have been in place for some time.
D) A firm’s business model is confined to its own boundaries.
E) Firms should guard themselves against thinking that one particular business model is
a “home run” regardless of circumstances.
Answer:
According to the textbook, beyond their own funds, the second source of funds for
many new ventures is ________.
A) government grants
B) business angels
C) friends and family
D) banks
E) venture capital
Answer:
Which of the following is one of the “red flags” listed in the textbook that raises
questions about one or more aspects of a company’s business plan?
A) Takes several days or weeks to complete
B) Founders that have their own money at risk
C) Defining the market size too broadly
D) Less than 50 pages long
E) Directed towards both an external and an internal audience
Answer:
The ability to notice things without engaging in deliberate search is referred to as
________.
A) cognitive alertness
B) cognitive awareness
C) managerial alertness
D) entrepreneurial alertness
E) individual awareness
Answer:
The primary opportunity existing for startups in fragmented industries is to ________.
A) pursue a niche strategy, which focuses on a narrow segment of the industry that
might be encouraged to grow through product or process innovation
B) win customers by placing an emphasis on service and process innovation
C) capture a first-mover advantage
D) pursue a cost reduction strategy, which is accomplished through achieving lower
costs than industry incumbents through process innovation
E) consolidate the industry and establish industry leadership as a result of doing so
Answer:
Some companies monitor the integrity of their brands through a program of brand
________.
A) administration
B) persistence
C) determination
D) resolution
E) management
Answer:
Courtney Young is the founder of a company in the semiconductor industry. Courtney’s
firm is still in the feasibility analysis stage and doesn’t have a product that is ready to
sell. The company is spending about $25,000 per month and expects to maintain that
level of spending until it reaches profitability. The $25,000 a month is Courtney’s
________ rate.
A) consumption
B) utilization
C) burn
D) usage
E) liquidity
Answer:
________ stock is typically issued to conservative investors who have preferential
rights over common stockholders in regard to dividends and to the assets of the
corporation in the event of liquidation.
A) Restricted
B) Partial
C) Preferred
D) Common
E) Limited liability
Answer:
Which of the following represents the correct order of the five stages of the creative
process?
A) Preparation, incubation, elaboration, insight, evaluation
B) Insight, preparation, incubation, elaboration, insight
C) Preparation, incubation, insight, evaluation, elaboration
D) Incubation, evaluation, insight, preparation, elaboration
E) Incubation, preparation, evaluation, elaboration, insight
Answer:
The first sale of stock by a firm to the public is referred to as a(n) ________.
A) original public submission
B) first unrestricted offering
C) preemptive initial offering
D) original open offering
E) initial public offering
Answer:
A(n) ________ bank is an institution, such as Credit Suisse First Boston, that acts as an
underwriter or agent for a firm engaged in an initial public offering.
A) venture
B) statutory
C) fiduciary
D) investment
E) public
Answer:
All of the following are advantages to buying a franchise except ________.
A) restrictions on creativity
B) potential for business growth
C) availability of financing
D) a proven product or service within an established market
E) franchisor’s ongoing support
Answer:
GymFlow, the company profiled in the opening feature in Chapter 8, created a mobile
app that shows how busy a gym is at any given point in time. According to the case, in
regard to financial management, the cofounders of GymFlow found that ________ was
one of their most difficult challenges.
A) managing accounts payable
B) managing accounts receivable
C) projecting future income
D) projecting future expenses
E) completing financial statements
Answer:
According to the textbook, a 2010-2012 study of 350 entrepreneurs found that of those
that had successful exist, only about ________ started with a business plan
A) 10 percent
B) 15 percent
C) 20 percent
D) 30 percent
E) 40 percent
Answer:
Which of the following statements about target markets is incorrect?
A) There is a distinct difference between a firm’s industry and its target market.
B) The challenge in identifying an attractive target market is to find a market that’s large
enough for the proposed business but is yet small enough to avoid attracting larger
competitors.
C) By focusing on a target market, a firm can usually avoid head-to-head competition
with industry leaders and can focus on serving a specialized market very well.
D) A target market is a place within a larger market segment that represents a narrower
group of customers with similar needs.
E) It’s generally easier to find good information about a target market than an industry
as a whole.
Answer:
________ is the granting of permission by one company to another company to use a
specific form of its intellectual property under clearly defined conditions.
A) Verifying
B) Confirming
C) Endorsing
D) Licensing
E) Certifying
Answer:
A ________ is any word, name, symbol, or device used to identify the source of origin
of products or services and to distinguish those products or services from others.
A) copyright
B) trademark
C) license
D) trade secret
E) patent
Answer:
According to the textbook, how do well-managed firms respond to the five forces that
determine industry profitability?
A) They switch industries if the forces are too compelling.
B) They focus on one force intently and excel by overcoming that force.
C) They overcome each of the forces.
D) They ignore the forces.
E) They try to position their firms in a way that avoids or diminishes the forces.
Answer:
Brain Sentry is starting a firm in the small industry that helps football teams discern
whether a player has suffered a concussion. This industry is still so new that no standard
operating procedures have been developed. The industry Brain Sentry is entering is an
example of a(n) ________ industry.
A) mature
B) declining
C) emerging
D) global
E) fragmented
Answer:
The operations quadrant in the Barringer/Ireland Business Model Template includes
three sections. These are ________.
A) product (or service) production, channels, and key partners
B) product/market scope, cost structure, and key partners
C) key assets, cost structure, and channels
D) key partners, financing/funding, and target market
E) channels, core competency, and key partners
Answer:
A network entrepreneur is an individual who identifies his or her business idea
________.
A) on their own
B) through the assistance of a paid consultant
C) through social contacts
D) with one or more partners
E) through a business incubator program
Answer:
The ________ section of a business plan breaks the industry into segments and zeroes
in on the specific segment (or target market) to which the firm will try to appeal.
A) competitive analysis
B) current status
C) market analysis
D) marketing plan
E) operations plan
Answer:
In the terminology of the Barringer/Ireland Business Model Template, ________ assets
are the assets that a firms owns that enable its business model to work.
A) key
B) tactical
C) fundamental
D) primary
E) strategic
Answer:
The major advantage of leasing is that ________.
A) it enables a company to have access to average or above average facilities and
equipment
B) it enables a company to acquire the use of assets with little or no down payment
C) it is cheaper in the long run than purchasing
D) a lease agreement is easier to negotiate than a purchase agreement
E) it is easier to obtain credit on a lease than a purchase
Answer:
Which of the following is not generally eligible for trademark protection?
A) Trade dress
B) Shapes
C) Words
D) Surnames
E) Designs or logos
Answer:
London Simpson owns a company that makes smartphone accessories. She is trying to
increase her sales, primarily because she knows that increasing production lowers the
average cost of each unit produced. The reason for growth illustrated in this example is
________.
A) economies of scope
B) market leadership
C) influence, power, and survivability
D) need to accommodate the growth of key customers
E) economies of scale
Answer:
The Partnering for Success feature in Chapter 12 starts by talking about Gary
Schwartzberg, who, along with a partner, developed a new type of bagel dubbed the
“Begeler,” which was eventually licensed to Kraft. According to the feature,
entrepreneurs and inventors like Gary Schwartzberg are finding that large consumer
products companies are ________.
A) ambivalent about what they have to offer
B) increasingly interested in what they have to offer for new products, but are
ambivalent about services
C) increasingly interested in what they have to offer
D) increasingly interested in what they have to offer for new services, but are
ambivalent about products
E) increasingly disinterested in what they have to offer
Answer:
Melanie Jacobs recently opened a Papa John’s franchise. So far, she is very satisfied
with Papa John’s because in exchange for an initial franchise fee and an ongoing royalty
payment, Papa John’s has provided Melanie a formula for doing business along with
training, advertising, and other forms of assistance. Melanie purchased a ________
franchise.
A) business extension
B) formula driven
C) sales extension
D) product and trademark
E) business format
Answer:
According to our textbook, the seed money that gets a company off the ground typically
comes from ________.
A) angel investors
B) venture capitalists
C) commercial banks
D) governmental agencies
E) the founders of the firm
Answer:
PickFu and Ubounce are Web sites that provide access to ________.
A) 3D printing services
B) Web site usability testing
C) online whiteboarding services
D) A/B split testing services
E) feedback on business ideas
Answer:
According to the textbook, a successful brand can increase the market value of a
company by ________ to ________ percent.
A) 5; 10
B) 20; 30
C) 40; 50
D) 50; 75
E) 75; 100
Answer:
Entrepreneurial businesses that grow by expanding from their original location to
additional geographic sites are pursuing a ________ strategy.
A) common expansion
B) market penetration
C) universal networking
D) geographic expansion
E) product line extension
Answer:
________ are an estimate of a firm’s future income and expenses, based on its past
performance, its current circumstances, and its future plans.
A) Calculation statements
B) Forecasts
C) Statements of cash flow
D) Financial statements
E) Prediction statements
Answer: