The term of a utility patent is:
A) 7 years from the date the patent is granted
B) 15 years from the date of the initial application
C) 15 years from the date the patent is granted
D) 20 years from the date of the initial application
E) 20 years from the date the patent is granted
Answer:
The ________ is a competitive grant program that provides over $1 billion per year to
small businesses for early-state and development projects.
A) SBTA Program
B) SBIR Program
C) SBAP Program
D) SAIR Program
E) SBTR Program
Answer:
Sarah Thorton is the founder of a company named Extreme Sports Apparel. The
company makes apparel products for extreme sports enthusiasts such as rock climbers,
triathletes, parasailors, and BMX bikers. Sarah wants her company to pursue a high
level of corporate entrepreneurship. To achieve that goal, Sarah’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:
A ________ combines the advantages of a partnership and a C corporation.
A) subchapter S corporation
B) limited partnership
C) general partnership
D) sole proprietorship
E) subchapter K corporation
Answer:
All of the following are advantages of a sole proprietorship except:
A) creating one is easy and inexpensive
B) unlimited liability
C) it is not subject to double taxation
D) the owner maintains complete control of the business
E) business losses can be deducted against the sole proprietor’s other sources of income
Answer:
In regard to international franchising, under a(n) ________, the U.S. franchisor grants
the rights to an individual or company (the developer) to develop multiple franchised
businesses within a country or territory.
A) indirect franchise agreement
B) global franchise agreement
C) concurrent franchise agreement
D) direct franchise agreement
E) express franchise agreement
Answer:
Which of the following statements is incorrect about grant programs?
A) Granting agencies are very visible and well-known, so it’s normally not hard to find
one.
B) The federal government has grant programs beyond the SBIR and STTR programs.
C) It’s important to avoid grant-related scams.
D) There are a limited number of organizations that offer new businesses grants.
E) There are private foundations that grant money to both existing and startup firms.
Answer:
There are two primary audiences for a business plan: 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 regarding business success (or failure) rates is
correct?
A) After four years, 15 percent of new businesses are still open.
B) After four years, 25 percent of new businesses are still open.
C) After four years, 50 percent of new businesses are still open.
D) Two out of three businesses fail within the first four years.
E) Nine out of ten businesses fail within the first four years.
Answer:
The Savvy Entrepreneurial Firm feature in Chapter 1 focuses on Revio Mobile (maker
of Angry Birds) and Zeo, two companies that have produced successful products. The
feature’s main purpose is to illustrate the importance of ________ as a key characteristic
of the founders 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:
Jeff Mommer is starting an environmentally friendly lawn and garden service. One
thing that Jeff has worked hard on is determining how his company will compete in the
marketplace. This element of Jeff’s business model is referred to as:
A) core strategy
B) strategic resources
C) partnership network
D) fulfillment and support
E) customer interface
Answer:
Which of the following items is typically not included in a concept statement?
A) a brief description of the company’s management team
B) a description of how the product or service will be sold and distributed
C) a description of how much money the new venture needs
D) the benefits of the product or service
E) the intended target market
Answer:
The price of prescription medicine is high, partly because when someone is sick there is
no real alternative to buying medicine if they want to get better. Which of Porter’s five
forces explains how this aspect of the prescription medicine industry helps keep
profitability high?
A) rivalry among existing firms
B) threat of new entrants
C) threat of substitutes
D) bargaining power of buyers
E) bargaining power of suppliers
Answer:
A grant from the federal government conferring the rights to exclude others from
making, selling, or using an invention for a specific period of time is referred to as a(n):
A) trademark
B) copyright
C) idea secret
D) innovation
E) patent
Answer:
The ________ is a short overview of the entire business plan.
A) summary statement
B) executive summary
C) managerial review
D) founder’s introduction
E) abstract
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:
A(n) ________ is a favorable set of circumstances that creates a need for a new
product, service, or business.
A) idea
B) scheme
C) design
D) proposal
E) opportunity
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:
Corporations are organized as either:
A) permanent corporations or temporary corporations
B) general corporations or limited corporations
C) voluntary corporations or statutory corporations
D) C corporations or subchapter S corporations
E) regular corporations or limited liability corporations
Answer:
According to the textbook, two of the most important factors to consider regarding
“management prowess” are:
A) the passion the sole entrepreneur or the management team has for the business idea
and the extent to which the management team or sole entrepreneur understands the
markets in which the firm will participate
B) whether the members of the management team have worked successfully together
before and the passion the sole entrepreneur or the management team has for the
business idea
C) whether the members of the management team are good “networkers” and the extent
to which the management team or sole entrepreneur understands the markets in which
the firm will participate
D) the educational and functional backgrounds of the management team or sole
entrepreneur
E) whether the members of the management team are good “networkers” and the
passion the sole entrepreneur or the management team has for the business idea
Answer:
Trevor Watts owns a printing company. Over the past three years, Trevor has
significantly increased his sales through the outright purchase of other printing firms.
Trevor is pursuing a(n) ________ strategy.
A) acquisition
B) merger
C) strategic alliance
D) joint venture
E) licensing
Answer:
Which “phase” of the SBIR Program is intended to demonstrate the proposed
innovation’s technical feasibility?
A) Phase I
B) Phase II
C) Phase III
D) Phase V
E) Phase X
Answer:
Maureen Kimble owns a firm that sells products to the auto, aerospace, and defense
industries. Maureen is currently evaluating a set of opportunities that she feels her firm
is capable of pursuing. According to the textbook, Maureen is evaluating her firm’s:
A) prolific potential
B) dynamic opportunity options
C) productive opportunity set
D) passionate opportunity set
E) creative field of potential
Answer:
According to the textbook, most entrepreneurial firms:
A) are ambivalent about growth
B) want to grow
C) do not want to grow
D) want to grow if the economy is strong but do not want to grow if the economy is
weak
E) want to grow if they are a service firm but do not want to grow if they are a
manufacturing firm
Answer:
Since the first patent was granted, there have been over ________ patents granted in the
United States.
A) 500,000
B) 3 million
C) 5 million
D) 7 million
E) 9 million
Answer:
________ is the process of creating something new, which is central to the
entrepreneurial process.
A) Creative destruction
B) Modernism
C) Execution
D) Creativity
E) Innovation
Answer:
A firm’s ________ describes why it exists and what its business model is supposed to
accomplish.
A) mission statement
B) vision statement
C) feasibility statement
D) duty statement
E) responsibility statement
Answer:
The panel of individuals who are elected by a corporation’s shareholders to oversee the
management of the firm is called the:
A) board of advisors
B) accountability panel
C) advisory team
D) panel of directors
E) board of directors
Answer:
While franchise agreements vary, each agreement typically contains the franchise
agreement and:
A) the legal agreement
B) the procurement agreement
C) the purchase agreement
D) the sell agreement
E) the conversion agreement
Answer:
According to the textbook, studies show that more than one individual starts ________
of all new firms.
A) 20 to 25 percent
B) 50 to 70 percent
C) 5 to 15 percent
D) 30 to 40 percent
E) 75 to 90 percent
Answer:
A company’s ability to productively utilize its assets relative to its revenue and its
profits is referred to as:
A) efficiency
B) effectiveness
C) stability
D) liquidity
E) profitability
Answer:
A(n) ________, which is typically 25 to 35 pages long, works best for new ventures
who are at the point where they need funding or financing.
A) tactical business plan
B) strategic business plan
C) summary business plan
D) full business plan
E) operational business plan
Answer: