Archives: Quiz

Ratio analysis can be applied from which of the following directions? a. vertical only b. vertical and horizontal c. horizontal only d. external and internal Which of the following are suggestions to minimize legal costs? a. visit the lawyer during […]

A business plan __________ potential financial backers. a. indicates the exact sum to be borrowed from b. establishes a first impression of the company and its principals on c. provides an accurate sales forecast for d. purposefully underestimates financial need […]

Evaluating franchise opportunities include finding out more about which of the following? a. the franchisor b. the franchise c. the franchisee d. all of the above The discounted earnings method of valuation establishes a. potential earning power. b. an appropriate […]

With psychic risk you fear a. losing your sanity b. failure. c. money d. adapting. Sales growth is a critical factor in the a. prestart-up phase. b. poststart-up phase. c. start-up phase. d. evaluations phase. Answer: C Which of the […]

A reason new venture managers lack knowledge in the strategic planning process is because a. they refuse to learn new things. b. they have minimal exposure to the planning process. c. they attempt to implement actions too quickly. d. they […]

When considering bankruptcy, entrepreneurs as sole proprietors normally prefer a. Chapter 5. b. Chapter 7. c. Chapter 11. d. Chapter 13. The past is the best predictor of the future, according to which mind-set? a. the entrepreneurial mind-set b. the […]

Entrepreneurs themselves perceive the concept of risk in which of the following ways: a. calculated risk taking b. gambling risk c. distorted risk taking d. social risk In the context of buying a business, a known commodity may command a […]

A patent gives the holder a temporary a. profit. b. oligopoly. c. monopoly. d. specification. In an innovative climate, failure is viewed as a. the end of the world. b. a learning experience. c. O.K., inevitable, since the employee is […]

The results of a profile analysis enable the entrepreneur to judge a. himself or herself. b. the competition. c. the potential of the business. d. venture capital opportunities. Most entrepreneurs are objective when they evaluate their new idea. Answer: F […]

The extra value a business can command in a sale is known as a. goodwill. b. saleable value. c. market value. d. asset value. Which economist first associated the ‘risk bearing’ activity in the economy with the entrepreneur? a. Richard […]

Entrepreneurs sense potential in business problems by asking a. who is to blame for failures? b. what about profits? c. what if and why not? d. farfetched, unimaginative questions A written succession strategy a. is part of an entrepreneur’s will. […]

The most pro-active position for a corporation to take in regard to social responsibility would be termed a. social obligation. b. social intensity. c. social responsiveness. d. social decisiveness. If you agree that the real value of a business venture […]

In order to develop an entrepreneurial environment, factors that organizations need to be aware of include: a. management support and rewards b. autonomy and time c. business plans and inventions d. a and b should be considered The cash flow […]

The ‘corridor principle’ states that entrepreneurs often get stuck on one idea. An important guideline in putting the plan together is a. to overdiversify. b. to not highlight critical risks. c. to identify the target market. d. to impress with […]

When using the internal rate of return method, the future cash flows are discounted at a rate that makes the net present value equal to a. assets minus liabilities. b. assets minus owner’s equity. c. assets minus (liabilities plus owner’s […]

Which of the following mental habits inhibit creativity and innovation? a. either/or thinking, stereotyping b. functional perspective, mind-sets c. security hunting, risks d. stereotyping, incubation Gazelles have been responsible for which of the following: a. some job growth b. 55 […]

Entrepreneurs always a. start their business at a young age b. quit school and devote themselves to being an entrepreneur c. use credit cards to start their own businesses d. generate ideas and plan for their implementation Which of the […]

Legal protection is granted to computer programs in what form? a. patent b. trademark c. copyright d. service mark The text of a patent application is known as the a. specification. b. particulars. c. concept. d. value. Answer: A Competitive […]

Some entrepreneurs are easy to replace, and some cannot be replaced. One of the benefits of a business plan for a financial source is that it forces the source to view the plan for miscalculations. Answer: F The real value […]

There are five specific phases that a new venture goes through. Tangible assets as well as intangible assets of a business need to be assessed for proper venture evaluation. Answer: T Encourage user participation and dialogue. A successful social media […]

Capital budgeting is used to help the entrepreneur plan for capital expenditures. Entrepreneurial cognition is, in part, about understanding how entrepreneurs use simplifying mental models to make assessments, judgments, and decisions about opportunities. Answer: T Nonfamily members sometimes bring pressure […]

Harvest strategies rarely involve the complete sale of a business. During the past ten years, new business incorporations averaged nearly 600,000 per year. Answer: T Explain the purpose of a letter of intent. Answer: A letter of intent is preliminary, […]

Is the firm’s budget allocated appropriately for greater profit’”according to products, territories, and market potentials? What is included in an operating budget and how is this helpful? Answer: The operating budget includes a sales forecast. A forecast can be acquired […]

Most successful innovations are complex and focused. The price/earnings ratio (multiple of earnings) method is determined by dividing the market price of common stock by retained earnings. Answer: F The liquidity event stands for positioning the venture for the realization […]

The person who sells the franchise is usually required to do all of the following except: a. pay a fee. b. provide professional management training to the unit’s staff. c. help out with financial assistance. d. provide continuing aid and […]

Laws governing intellectual property rights include copyrights, trademarks, and leases. In the context of benefit corporations, what does transparency refer to? Answer: Transparency refers to the obligation to report to the public on a firm’s overall social and environmental performance, […]

Name and describe the final phase of the budget process. Break-even analysis is used to tell how many units must be sold in order to break even at a particular selling price. Answer: T A loss orientation toward grief recovery […]

An entrepreneur needs neither a lot of money nor luck. Factors that must be addressed when planning a new venture include setting realistic goals, determining milestones, making a commitment, and having flexibility. Answer: T Venture capital firms want to own […]

Social entrepreneurs are known to combine resources to exploit opportunities to create social value. As part of creating an innovative climate, a firm should base rewards given upon results achieved. Answer: T The elimination of time and effort associated with […]

One of every 1,000 adults participates in the founding of a new firm every year. A trademark is a distinctive name, mark, or symbol that is identified with a company’s product. Answer: T The harvest decision may come when the […]

Researchers have identified specific factors that organizations can concentrate on in helping individuals develop more entrepreneurial behavior. The business plan is the entrepreneur’s road map for a successful enterprise. Answer: T Innovators must always search for new ideas, opportunities, or […]

An entrepreneurial successor is someone who is interested in efficiency and the effective use of resources. What are the rules for avoiding pitfalls in selecting trademarks? Answer: Trademarks registration and research is expensive. Trademark infringement is even more expensive. There […]

The easiest way to avoid the pitfall of no commitment or dedication is to designate that the venture is a hobby or a whim. Not all corporate entrepreneurial behavior is good for the organization. Why? Answer: The encouragement of corporate […]

Entrepreneurs are aggressive catalysts for change within the marketplace. Name the sources of entrepreneurial stress and discuss the ways of dealing with stress. Answer: Entrepreneurs experience four types of stress. The first is loneliness. Although there are many people around […]

Ethics represents a set of principles prescribing a behavioral code that does not include moral duty and obligations. The metacognitive model of entrepreneurship fails to consider entrepreneurial motivation. Answer: F Solid analysis and evaluation of the feasibility of the product/service […]

Venture capitalists are usually satisfied with a reasonable return on investments. Every business plan should provide information about future harvest strategies. Answer: T An entrepreneur can never be certain what actual ethical consequences a decision will have. Answer: T The […]

How does a public offering differ from a private placement? When the founder of a business is willing to share authority, succession problems can be maximized. Answer: F Emotional bias is not an underlying issue in valuing a business. Answer: […]

Venture capitalists, surprisingly, require little information before they make an investment. Most venture capital funds later stages of venture development, not the start-up (or seed) stage. Answer: F Design patents last for 20 years. Answer: F Most firms generally gather […]

The liquidity event can be achieved through an IPO or selling out. Firms do not need to alter management techniques to encourage corporate entrepreneurship since it tends to occur naturally. Answer: F Obtaining external financing is considered one of the […]

In negotiating a deal to purchase an existing business, it is possible to request that the seller retain a minority interest in the firm. Every business person feels comfortable operating in an entrepreneurial environment. Answer: F Entrepreneurs are doers not […]

One of the most helpful avenues for developing one’s own creative talents is to be aware of the habits and mental blocks that stifle creativity. Entrepreneurship involves an interdisciplinary approach. Answer: T Explain and discuss the ‘dark side’ of entrepreneurship. […]

In a lifestyle venture, independence, autonomy, and control are the primary driving forces. Two important factors classified as managerial that could be a cause for failure include human resource problems and the concept of the team approach. Answer: T Social […]

The entrepreneurial strategy matrix measures risk and innovation. Pro forma statements show the firm’s present financial position. Answer: F What are important questions to ask, from an entrepreneurial and administrative point of view, when managing entrepreneurial growth? Answer: The Entrepreneur’s […]

A lack of demonstrated experience, no clear market niche, a failure to anticipate roadblocks, no realistic goals set, and a lack of commitment are pitfalls or common points of failure that occur before an entrepreneur ever gets a plan reviewed. […]

An example of a trademark is a logo. Entrepreneurs are high risk takers. Answer: F Trust from the company is one key element to successful corporate entrepreneurship. Answer: T Purpose, accountability, and transparency are characteristics associated with socially sustainable enterprises. […]

In some cases, entrepreneurs may be in violation of the law if they employ too many family members. Bill and James Raymond have worked for their father’s company for 15 years. Their father, who is president and now wants to […]

The word entrepreneur is derived from the Spanish word entreprendre, meaning ‘to undertake.’ Selfishness and a need for power are two characteristics common in entrepreneurs. Answer: F Research has shown a distinct lack of planning on the part of new […]

A summary gives a brief overview of what is to follow, helps put all of the information into perspective, and should be no longer than ten pages. What should be considered in analyzing a business and what are some weaknesses […]

Business valuation is essential when attempting to buy out a partner. Because the advantages of going public outweigh the disadvantages, it is in a corporation’s best interest to go public. Answer: F Licensing agreements can involve patents, trademarks, and technical […]

The typical business will have cash inflows from three sources: cash sales, cash payments received on account, and loan proceeds. A common mistake in business planning is to purge all acronyms and technical jargon from the plan. Answer: F Resource-rich […]