Specialized knowledge is an example of a barrier to entry.
To be effective, the small business owner should limit strategic analysis to only the two
or three most significant opportunities facing the firm.
To project cash receipts, an entrepreneur must analyze accounts receivable to determine
the company’s collection pattern.
Business owners must recognize that what they do before they start interviewing
candidates for a position determines to a great extent how successful they will be in the
hiring process.
Osterwalder and Pigneur found that most entrepreneurs use a visual process, such as
diagramming their business on a whiteboard, when developing their business ideas.
A master franchise gives the franchisee the right to create a semi-independent
organization in a particular territory to recruit, sell, and support other franchisees within
a specific time frame.
Employees’ moral stance is the broadest and most fundamental definition of ethical
standards.
The manufacturer’s suggested retail prices may create an undesirable image for the
small firm.
Some businesses use cycle billing, in which a company bills a portion of its credit
customers each day of the month to smooth out uneven cash receipts.
The left brain processes information in a step-by-step fashion.
Social entrepreneurs start businesses so that they can create innovative solutions to
society’s most vexing problems.
Clothing is one of the most popular items sold in regional shopping malls.
History is always a reliable predictor of the future of business.
Before purchasing an existing business, an entrepreneur should analyze both its existing
and its potential customers.
The interchange fee is a bank charge that retailers pay whenever customers use a credit
or a debit card to pay for a purchase.
The entrepreneurs who are proving to be the most successful in e-commerce are those
who know how ________.
A) their industries work, inside and out
B) technology works, inside and out
C) to turn a profit
D) to effectively finance their e-commerce effort
Which of the following statements concerning a company’s target market is false?
A) Marketing experts contend that the greatest marketing mistake small companies
make is failing to clearly define the target market to be served.
B) A ‘shotgun approach” to marketing (trying to appeal to everyone rather than to only a
small market segment) is the most effective way to compete with large companies and
their bigger marketing budgets.
C) Small companies are usually better suited to pinpointing target markets that their
larger rivals overlook or consider too small to be attractive.
D) Most successful small businesses have well-defined portraits of the customers they
are trying to attract.
A good advice to follow in customer surveys is ________.
A) “Keep them short”
B) “Be as detailed as possible”
C) “You’ve got them hooked, get all you can from them”
D) All of the above
A cash budget is only as accurate as the ________ forecast from which it is derived.
A) profit
B) receivables
C) income
D) sales
Every business is characterized by a set of controllable variables that determines the
relative success (or lack of it) of market participants called ________.
A) distinctive competencies
B) key success factors
C) opportunities and threats
D) competitive edge
The left brain is guided by ________.
A) kaleidoscopic, lateral thinking
B) linear, vertical thinking
C) asymmetrical thinking
D) intuitive thinking
An entrepreneur considering two sites for a men and boys shop determines that she/he
needs sales of $158 per square foot to be profitable. Site #1 has 13,500 potential
customers who spend an average of $160.20 per year on men and boys wear. Two
competitors occupy 14,200 square feet of space. Site #2 has 10,800 potential customers
who spend an average of $152.10 per year on men and boys wear. One competitor has
10,000 square feet.
Based on the above calculations, what is the entrepreneur’s best option?
A) She/he should choose site #1.
B) She/he should choose site #2.
C) Neither site meets minimum criteria of $158 per square foot.
D) Either site will work well since both meet minimum criteria of $158 per square foot.
Business owners new to international business are sometimes shocked ________.
A) by the wide range of labor costs they encounter
B) that practices common in the United States (e.g., overtime, women workers, and
employee benefits) are restricted, disfavored, or forbidden in other cultures
C) that what appear to be “bargain” labor rates turn out to be excessively high after
accounting for the quality of the labor force and the benefits their governments mandate
D) All of the above
Virtual shop owners using banner ads have no reason to buy ads in traditional
advertising media.
The majority of new business owners work ________.
A) fewer than 40 hours per week
B) more than 40 hours per week
C) more than 70 hours per week
D) more than 80 hours per week
The percentage of shoppers who place at least one item in a shopping cart but never
complete the transaction is called the ________.
A) bounce rate
B) cart abandonment rate
C) conversion rate
D) cost per acquisition
Many new businesses require that an entrepreneur have a certain set of knowledge,
experiences, and skills to have any chance of success. This is called entrepreneurial
________.
A) grit
B) trait
C) readiness
D) chutzpah
Before going global, entrepreneurs should ask themselves questions regarding
________.
A) profit potential and commitment of resources for a global effort
B) a viable exit strategy and the cost of not going global
C) the reasons, rationale, and understanding cultural differences
D) All the above
Earning a profit may not be a company’s ________ responsibility.
A) first
B) only
C) singular
D) last
The ________ of a nation includes the belief, values, views, and mores that its
inhabitants share.
A) political atmosphere
B) culture
C) tariffs
D) free trade area