Most small businesses never go through the takeoff stage.
The more time and energy one spends preparing for a small-scale part-time business,
the longer it takes to make a profit.
A start-up can be kept small deliberately to limit the magnitude of possible losses.
Marketing and new product experts believe that most of the small business failures
could have been avoided by following the new product development (NPD) process.
For me-too products, the stages of new product development are always extensively
long.
Bootstrapping refers to:
A. funding a business online through the collective involvement of others who provide
loans.
B. buying, renting, or leasing a prepackaged business from another company.
C. inheriting or being given a stake in a family business.
D. using low-cost or free techniques to minimize the cost of doing business.
Soul pine caf© issues a card to each new customer on which every purchase is stamped,
and when a customer completes nine purchases, he or she gets the tenth service for free.
This is a typical example of _____.
A. a loyalty program
B. price lining
C. price bundling
D. going rate pricing
A traditional small business generally has sales of between:
A. $100,000 and $1,000,000.
B. $100,000 and $200,000.
C. $25,000 and $100,000.
D. $50,000 and $80,000.
______ occurs when the owner of real property does not enforce property rights and
allows a nonowner to use the property as if it were his or her own.
A. Abandonment
B. Accession
C. Property liability
D. Adverse possession
Which of the following is one important advantage of key resource allocation?
A. It has a financial plan for the future, based on a single level of operations; a
quantitative expression of the use of resources necessary to achieve a business’s
strategic goals.
B. As only assets are acquired, a subsequent business, regardless of its legal form, is not
responsible for any of the acts or transactions made prior to purchasing the business.
C. It has an agreement between two or more entities to pool resources in order to
complete a project.
D. It specifies the time that is required for a business to acquire resources, convert them
into product, sell the product, and receive cash from the sale.
Which of the following refers to income capitalization?
A. Regular and systematic reduction in income that transfers asset value to expense
over time.
B. Dividing projected net income excluding depreciation, interest, and owner draws, by
the best return that you could expect to obtain in other investments.
C. Multiplying your estimate of future earnings by the net income to equity ratio.
D. The amount of profit earned by a business before calculating the amount of income
tax owed.
Which of the following is a strategy to handle cash shortfalls in small businesses?
A. Purchasing investments
B. Increasing payables
C. Borrowing money
D. Retaining employees
Which of the following is the key to customer relationship management (CRM)?
A. Displaying accurate financial records in annual reports
B. Educating customers about a new product or service
C. The data on current or prospective customers
D. The press release and press kit
Which of the following is a free way to get one’s name and business known?
A. Through improving the search engine optimization of one’s business
B. Tele marketing
C. Distributing business cards, stationery, printed newsletters, and brochures
D. Making informed comments on blogs and discussion forums related to one’s
business
Liability insurance protects a business against:
A. disgruntled former employees filing suites.
B. current employees setting up businesses which turn into competition for the
organization.
C. losses incurred due to the death of a key employee.
D. claims from harm caused by inadvertent consequences of actions of the business or
its employees.
According to the U.S. Small Business Administration, small businesses generate _____
times the number of patents per employee than do big businesses.
A. 35.5
B. 2.5
C. 16.5
D. 50.5
A(n) _____ refers to the products that are held for sale to customers.
A. inventory
B. layaway
C. plant
D. lock box
_____ requires an entrepreneur to assess whether the situation faced is one that is the
same as it has been traditionally or if it is changing.
A. Business process modeling
B. Opportunity identification process
C. Pilot test
D. Radical innovation strategy
Certain businesses demand higher safety related rules. For example, window cleaners
that specialize in high-rise buildings have certain rules and safety protocols. These
specific rules would comprise the _____.
A. specialized business professionalization
B. infant-industry argument
C. industry-specific knowledge
D. key business functions
A(n) _____ plan gives the basic overview of a firm and a detailed look at the financials.
A. screening
B. operational
C. competitive
D. invention
According to the Panel Study of Entrepreneurial Dynamics (PSED), a majority of
entrepreneurs indicated that:
A. the decision to start a business came first.
B. the business idea came first.
C. the idea and decision were simultaneous.
D. starting a business is a loss-making proposition.
Differentiate between income statement and balance sheet.
What is franchising? Briefly explain the different forms of franchising.
Differentiate manufacturing layouts from retail store layouts.
Discuss some of the common critical risks in a business plan.
What is the difference between delegation and outsourcing?
Define opportunity recognition and entrepreneurial alertness.
Discuss the challenge of succession faced by family businesses.
Briefly outline a strategy that a firm could adopt in order to manage risk.
What are the four broad categories of financial ratios? Give an example of each.