A badly managed small business is more liquid than a well-managed company.
In a partnership, each partner is responsible for the acts of all the other partners.
To make a profit, your prices must cover only direct costs and exclude all indirect costs.
The business plan should be delivered from the entrepreneur’s perspective, not the
investor’s.
In high-crime neighborhoods, many businesses use tough, shock-resistant transparent
materials in their windows instead of glass as a security measure.
Choosing and maintaining a target market is easy because of stable consumer
characteristics.
The best-known form of risk transfer is insurance.
A _____ is one that is independently owned and operated and is not dominant in its
field of operation.
a) monopolistic organization
b) public enterprise
c) close corporation
d) small business
______ are usually best for customers who have brand or company loyalty.
a) Convenience shops
b) Freestanding stores
c) Warehouse outlets
d) Community shopping centers
A _____ is a long-term debt that is secured by real estate property.
a) mortgage loan
b) bond
c) lease
d) asset-based loan
_____is the uncertainty that some unpredictable event will result in a loss.
a) Secondary risk
b) Speculative risk
c) Pure risk
d) Voluntary risk
What is the significance of the Federal Acquisition Streamlining Act?
a) It urges government agencies to buy off-the-shelf goods rather than items made to its
own specifications.
b) It encourages the government to communicate with vendors with detailed paperwork
rather than on-line.
c) It makes it easier for small companies to bid on non-federal contracts.
d) It makes the delivery of materials to the user at the time of production mandatory.
Which of the following is true of S corporation shareholders?
a) They are taxed at individual rates.
b) They are taxed at corporate rates.
c) They do not enjoy legal protection that comes with corporate status.
d) They have no restrictions on benefit plans.
Which of the following is true about a diagnostic interview?
a) Its purpose is to assess various aspects of the applicant’s personality.
b) It is a preliminary screening.
c) It is an in-depth interview.
d) It involves testing intelligence and aptitude through psychological tests.
_____ is the organized efforts of independent, government, and business groups to
protect end users from undesirable effects of poorly designed and produced products.
a) Polarization
b) Conservation
c) Consumerism
d) Protectionism
The Uniform Commercial Code has been adopted only in part by the U.S. state of
Louisiana.
_____ is the quantity to purchase that balances the cost of placing the order with the
cost of carrying the inventory.
a) Economic order quantity
b) Standing order
c) Stockout quantity
d) Purchase order
In a store, an item is priced extremely low by a dealer, but the salesperson points out the
disadvantages of the item and switches customers to items of higher quality and price.
What is this pricing policy called?
a) Leader pricing
b) Prestige pricing
c) Bait pricing
d) Odd pricing
Catherine, who loves dogs, wants to offer dog walking services to her neighbors, many
of whom have dogs. Her research leads her to a small professional pet care store
operating in the area, and she decides to buy it. Which of the following is a good reason
for Catherine to buy the pet care store?
a) The latest technology can be used to fill a service gap
b) A fresh inventory can be obtained
c) A competitive environment may be selected
d) The facilities are already available
The Vocational Rehabilitation Act of 1973 prohibits _____.
a) employment decisions based on race, color, religion, sex, or natural origin
b) discrimination and requires contractor to develop affirmative action programs to
recruit handicapped persons
c) discrimination against employees who are Vietnam-era veterans
d) employment discrimination against employees aged 40 and over including
mandatory retirement before 70
_____ hardware runs existing programs designed for older equipment.
a) Power supply
b) Backward compatible
c) Storage
d) Basic
Environmental protection involves:
a) dealing ethically with employees, customers, and competitors.
b) participating in community and charitable activities.
c) trying to maintain a healthy balance between people and their surroundings.
d) dealing with sexual harassment in the office.
Which of the following refers to a wrongful act by one party that results in injury to a
second party’s person, property or reputation, for which the first party is liable?
a) Bankruptcy declaration
b) Benevolence
c) Altruism
d) Tort
Which of the following is/are part of a company’s financial resource?
a) Tools and equipment
b) Available equity
c) Reputation
d) Supervisors
A well-managed small business is most likely to:
a) place low importance on the balance sheet.
b) emphasize rapid growth instead of stability.
c) emphasize long-range planning.
d) be less liquid than a badly managed company.
Which of the following nurture young firms and help them to survive and grow during
the startup period when they are most vulnerable?
a) Successful graduates
b) Business incubators
c) International trade organizations
d) Conglomerates
If you were a working mother, why would you prefer to establish a home-based
business instead of looking for a corporate position?
What are the barriers to effective communication?
What are the limitations faced by a family-owned business?
In the context of advertising for small businesses, what is an infomercial?
Describe the two types of bankruptcy.