The Savvy Entrepreneurial Firm feature in Chapter 2 focuses on Xhale and Vestagen,
two entrepreneurial startups. While each firm is different and is successful in its own
right, the main point of the feature is to illustrate that:
A) entrepreneurial startups can solve the same problem in different ways
B) entrepreneurial firms are often started by everyday people solving everyday
problems
C) one of the most important points to consider before launching a business is to
determine if its window of opportunity is open
D) finding gaps in the marketplace is an effective way of identifying business
opportunities
E) both economic and social forces impact the opportunities available to entrepreneurs
Answer:
Kevin Pierce was reading the business plan of New Venture Fitness Drinks, and noticed
that prior to its financial forecasts, New Venture Fitness Drinks placed an explanation of
the sources of the numbers for the forecast and the assumptions used to generate them.
This explanation is called a(n):
A) forecast sheet
B) forecast hypothesis
C) estimate statement
D) assumption sheet
E) hypothesis sheet
Answer:
________ is conducted to determine whether a proposed business has sufficient
management expertise, organizational competence, and resources to successfully launch
its business.
A) Industry/market feasibility analysis
B) Institutional feasibility analysis
C) Financial feasibility analysis
D) Organizational feasibility analysis
E) Product/service feasibility analysis
Answer:
Which of the following is not one of the four areas of feasibility analysis discussed in
the textbook?
A) product/service feasibility
B) financial feasibility
C) societal feasibility
D) organizational feasibility
E) industry/market feasibility
Answer:
“Organize all the world’s information and make it universally accessible and useful” is
Google’s:
A) function
B) duty
C) credo
D) purpose statement
E) mission statement
Answer:
The Savvy Entrepreneurial Firm feature in Chapter 14 focuses on SwitchFlops, a
company that produces sandals with interchangeable straps. The primary takeaway
from the feature is that savvy growth-minded startups:
A) utilize both internal and external growth strategies
B) emphasize internal rather than external growth strategies
C) emphasize international growth strategies from their inception
D) configure their products and services in ways that have built-in growth potential
E) compete on the basis of quality rather than price
Answer:
Firms that have a ________ strategy strive to have the lowest costs in the industry,
relative to competitors’ costs, and typically attract customers on that basis. In contrast,
firms using a ________ strategy compete on the basis of providing unique or different
products and typically compete on the basis of quality, service, timeliness, or some
other important dimension.
A) differentiation, cost leadership
B) cost emphasis, quality leadership
C) cost leadership, differentiation
D) price reduction, quality plus
E) cost differentiation, quality plus
Answer:
InstyMed’s phrase “We make patients better quicker” is an example of a(n):
A) tagline
B) grabline
C) notice-line
D) catchline
E) attention-line
Answer:
Organizations (typically nonprofit) that are formed by firms in the same industry to
collect and disseminate trade information, offer legal and technical advice, furnish
industry-related training, and provide a platform for collective lobbying are called:
A) strategic alliances
B) trade associations
C) networks
D) joint ventures
E) consortia
Answer:
The Partnering for Success feature in Chapter 14 is titled “Three Steps to Alliance
Success.” The three steps to alliance success identified in the feature are:
A) drafting a licensing agreement, setting up a governance structure, and making it
work
B) selecting a partner, cutting the deal, and making it work
C) interviewing potential partners, cutting the deal, and supervising the implementation
of the agreement
D) drafting a licensing agreement, cutting the deal, and setting up a governance
structure
E) selecting an alliance “manager,” setting up a governance structure, and making it
work
Answer:
In the context of competitor analysis, businesses that offer identical or similar products
are referred to as:
A) immediate competitors
B) direct competitors
C) indirect competitors
D) straight competitors
E) urgent competitors
Answer:
________ include marketing plans, product formulas, financial forecasts, employee
rosters, logs of sales calls, and laboratory notebooks.
A) Trade secrets
B) Trademarks
C) Collective marks
D) Patents
E) Copyrights
Answer:
According to the textbook, a focus group is a gathering of 5 to 10 people who are
selected because:
A) they are most likely to purchase large amounts of the product or service being
discussed
B) they responded to a self-selected opinion poll about the topic being discussed
C) of their relationship to the issue being discussed
D) they responded to a mail survey about the topic being discussed
E) they are spokespersons for the topic being discussed
Answer:
According to the textbook, the first step in a competitor analysis is to:
A) develop a marketing plan
B) develop the strategic plan
C) study the strength of the industry
D) study the external environment
E) determine who the competition is
Answer:
A board of directors has three formal responsibilities:
A) periodically update the firm’s business plan, declare dividends, and write the firm’s
marketing plan
B) appoint the officers of the firm, declare dividends, and oversee the affairs of the
corporation
C) write the firm’s strategic plan, declare dividends, and conduct the annual meeting
D) appoint the officers of the firm, conduct the annual meeting, and submit the firm’s
annual report to the Securities & Exchange Commission
E) provide funding to the firm, write the firm’s strategic plan, and submit the firm’s
annual report to the Securities & Exchange Commission
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:
Which of the following is the primary disadvantage of franchising as a foreign market
entry strategy?
A) It is usually a one-time activity.
B) quality control
C) A firm loses partial control of its business finances.
D) high transportation costs
E) The costs of setting up and maintaining a manufacturing facility and permanent
presence in a foreign country can be high.
Answer:
A company’s merchandise, raw materials, and products waiting to be sold is called its:
A) set aside
B) accumulation
C) reserve
D) inventory
E) stock
Answer:
A separate legal entity organized under the authority of a state is referred to as a:
A) limited partnership
B) conglomerate
C) general partnership
D) sole proprietorship
E) corporation
Answer:
GasBuddy and GasPriceWatch.com are companies started to help consumers save
money on gas. Which environmental trend is most likely to have provided the impetus
for the creation of these companies?
A) regulatory changes
B) political changes
C) economic forces
D) technological advances
E) social forces
Answer:
Most of Jacob’s ideas come from interacting with coworkers, friends, his spouse, his
parents, and other people that share the same beliefs that he does. Jacob is getting most
of his ideas through:
A) weak-tie relationships
B) horizontal-tie relationships
C) strong-tie relationships
D) multiple-tie relationships
E) vertical-tie relationships
Answer:
Jeremy Banks recently started a new firm in the financial services industry. Prior to
starting his firm, he spent considerable time doing research on the potential of the
industry. The research that Jeremy was doing is called:
A) industry analysis
B) sector analysis
C) commercial analysis
D) business analysis
E) target market analysis
Answer:
A firm’s working capital is its:
A) inventory and accounts receivable minus its current liabilities
B) current assets minus its current liabilities
C) total assets minus its total liabilities
D) cash and cash equivalents minus its current liabilities
E) accounts receivable minus its total accounts payable
Answer:
Which of the following selections correctly matches the financial statement with its
description?
A) income statement/tells how much a firm is making or losing
B) income statement/depicts the structure of a firm’s assets and liabilities
C) balance sheet/shows where a firm’s cash is coming from
D) balance sheet/tells how much a firm is making or losing
E) statement of cash flows/depicts the structure of a firm’s assets and liabilities
Answer:
When a firm’s managerial resources are insufficient to take advantage of its new
product and service opportunities, the subsequent bottleneck is referred to as the:
A) commercial capacity problem
B) entrepreneurial aptitude problem
C) managerial capacity problem
D) business capacity problem
E) business aptitude problem
Answer:
The What Went Wrong feature in Chapter 9 focuses on Deever, a 2008 startup that
helped software developers use cloud-based services to “test” their code in an expedient
manner. According to the feature, one of the primary reasons Deever failed was:
A) it lacked a cofounder who loved the business side of running a startup
B) the cofounders couldn’t get along
C) it didn’t build a robust partnership network
D) it didn’t solicit advice from attorneys, bankers or business consultants
E) it didn’t have a Board of Advisors
Answer:
A firm’s ________, in the context of its marketing mix, is the good or service it offers to
its target market.
A) conception
B) idea
C) formation
D) product
E) invention
Answer:
The number one characteristic shared by successful entrepreneurs is:
A) a desire to achieve financial rewards
B) passion for the business
C) a desire to employ other people
D) a desire to fulfill a lifetime dream
E) a desire to bring a revolutionary new product or service to market
Answer:
Franchising is appropriate when:
A) a firm’s business methods are not polished, it has a desire to grow, and it is trying to
commercialize a technology product
B) a firm has a strong trademark, a desire to grow, and a well-designed business method
C) a firm is trying to commercialize a technology product, it is well-funded, and it has a
desire to grow
D) a firm has a weak trademark, it is well-funded, and it has a desire to grow
E) a firm has a desire to grow, it has a well-designed business method, and it is well
funded
Answer:
Prosper is the best known:
A) factor
B) provider of SBA guaranteed loans
C) peer-to-peer lending network
D) provider of vendor credit
E) crowdfunding network
Answer:
A situation that involves doing something that is beneficial to oneself or the
organization, but may be unethical, is called a(n):
A) ethical quandary
B) ethical predicament
C) ethical dilemma
D) principled quandary
E) just dilemma
Answer:
According to the textbook, the unique value provided by business angels is:
A) they are willing to make relatively large investments
B) they are willing to make relatively small investments
C) they require a fairly low rate of return on their money
D) they invest money but typically don’t take a seat on a company’s board of directors
E) they are easy to find
Answer:
A ________ is a formal statement of an organization’s values on certain ethical and
social issues.
A) code of conduct
B) code of behavior
C) code of performance
D) code of principles
E) code of morals
Answer: