Unlock document.
This document is partially blurred.
Unlock all pages and 1 million more documents.
Get Access
Entrepreneurship, 3e (Bamford)
Chapter 1 The Twenty-First-Century Entrepreneur
1) Entrepreneurial business is not important to the U.S. economy.
2) The United States Small Business Administration (SBA) provides a wealth of information and
assistance at all levels of organizational development and management for new entrepreneurial
businesses.
3) A critical element that an entrepreneur must solve for success is to develop the ability to
generate consistent and growing sales.
4) Profit margins are key to successful businesses.
5) Corporate America employs more people now than it did 10 years ago.
6) Small companies can take advantage of economies of scale better than large firms.
7) The rate of small-business failure has declined.
8) Alexis de Tocqueville, the French statesman, stated, "United States was not so much a nation
with ventures … but instead a nation of innumerable small ventures."
9) Charles Wilson, secretary of defense for President Eisenhower, stated, "What is good for
General Motors is good for the nation."
10) In the late 1970s and 1980s, the United States occupied the dominant economic position in the
world.
11) The Great Depression of the 1930s encouraged industrial concentration.
12) Today many of the multinational firms in the United States are technology firms that began in
the late 1970s and early 1980s.
13) One of the huge advantages of starting one's own business is that someone else can be the boss.
Small business owners are motivated by two areas to start a business: the desire to be their own
bosses and to set their own working hours.
14) A customer of a small business could be considered an important stakeholder to the success of
a company.
15) According to Thomas Stanley and William Donko in their book The Millionaire Next Door, 50
percent of the millionaires in the United States are self-employed.
16) Self-employed people make up less than 20 percent of the workers in the United States.
17) The business time line demonstrates both constants and natural evolution in the development
of the United States.
18) Close to 50 percent of the millionaires in the United States are entrepreneurs.
19) Entrepreneurial businesses fail to provide a means to meet the varied demands that individuals
face in a society.
20) Success in an entrepreneurial business can only be achieved with brutally hard and long hours.
21) Entrepreneurial businesses have the ability to make greater profits in markets that have been
ignored by larger corporations.
22) Large companies understand their customers more in the local area compared to a small firm.
23) In 2001, the federal General Accounting Office discovered that in the areas where military
bases closed, the unemployment rate was less than the national average. This is because of the
start-up of new small businesses in the areas.
24) Heather Schuck, owner of Glamajama, is an example of how women can concentrate on more
than one facet of life.
25) Small business growth is important in the United States and the world.
26) There are widespread efforts worldwide to encourage the development of small and medium
entrepreneurs.
27) The repayment rate on microloans is typically less than 50 percent, a much lesser repayment
rate than on most types of loans.
28) Venture capitalists typically do not invest more than $2 million.
29) A venture capital start-up is oriented toward the personal goals of the founder(s).
30) The presence of venture capital for start-ups is limited outside of the United States.
31) The development plan of a venture capital start-up is oriented around positive cash flow.
32) According to the U.S. government, a small business is classified as any business with fewer
than 500 employees.
33) A small business's harvest plan is to put the profits back into the company.
34) When using a harvest plan, small companies are organized to grow rapidly and they have no
debt.
35) A small business start-up is typically self-funded or closely funded by the founder.
36) A small business start-up should be designed to take advantages of the skills of the founder or
founders.
37) A small business start-up is typically oriented toward the personal goals of venture capitalists.
38) Facebook and LinkedIn were founded as entrepreneurial businesses, but they are more
accurately described as venture capital-backed businesses.
39) An entrepreneurial business's resources are less constrained than those of venture
capital-backed business.
40) Each business plan, like every business, should have its own voice, feel, and style.
41) A business plan should be a tool to think through a wide range of issues related to starting and
growing a business.
42) The latest U.S. Census reports indicate that firms with more than 500 employees represent
approximately 35 percent of all full-time employees in the United States.
43) What term is used to describe Walmart's ability to purchase more advertising space at a lower
cost per ad?
A) Advertising bonus
B) Buying bonus
C) Volume excess
D) Economies of scale
44) Small companies have flourished for all the following reasons EXCEPT:
A) they respond more quickly.
B) they operate more effectively.
C) they employ more skilled people.
D) they often expand easily in mature industries.
45) The development and implementation of a new business is part ________ and part ________.
A) luck; skill
B) genius; hard work
C) resources; hard work
D) art; science
46) What are the critical elements that an entrepreneur must solve for success?
A) An effective sales generation model
B) Sustainable operating profit margins
C) Being properly financed
D) All of these
47) Years ago, economists mistakenly predicted that small businesses would
A) be replaced by a smaller number of big businesses.
B) replace bigger businesses.
C) be replaced by franchises.
D) replace franchises.
48) According to the book, the development and implementation of a new business is
A) part art and part science.
B) part planning and part money.
C) a combination of creativity and art.
D) none of these.
49) ________ aid(s), counsel(s), assist(s), and protect(s) the interests of small business concerns.
A) The U.S. Small Business Administration
B) Stakeholders
C) Fortune 500 companies
D) Medium-sized businesses
50) Which one of the following is a huge advantage for small business owners to start a business?
A) Desire to be one's own boss
B) Benefit the stakeholders
C) Desire to work for others
D) Desire to be efficient and productive
51) The Small Business Administration was organized as a part of
A) the Small Business Administration Law.
B) the Small Business Act of July 30, 1953.
C) the Small Business Act of 1950.
D) the Small Business Agency of 1960.
52) ________ lead(s) to a condition where a single firm making 100 percent of the product is the
most efficient.
A) Harvest plan
B) Stakeholders
C) Economies of scale
D) Business strategy
53) The success of entrepreneurial businesses occurs partially because they are ________.
A) more focused than their large corporate counterparts
B) invested heavily in policies and procedures
C) characterized by corporate layers of management
D) responsible to public stockholders
54) In the context of the initial developments of the industrial base in the United States, which of
the following statements is true about robber barons?
A) They ensured that smaller operations were effectively put out of business.
B) They quickly came to dominate new sectors of the economy.
C) They were unable to take advantage of the economies of scale that were possible with the
industrial age.
D) They came to dominate industrial sectors that had existed historically.
55) Until the mid-1880s, almost all U.S. businesses were ________.
A) small
B) medium
C) large
D) indifferent
