Archives: Quiz

Customers can never be a source of risk for businesses. Limited liability companies’ primary advantage is that owners may easily choose whether to be taxed as an entity or have tax items pass through. Answer: TRUE Limited liability companies (LLCs) […]

The primary focus of corporate entrepreneurship is creating new civic organizations which are financially self-sufficient. Most small businesses-even part-time ones-need to have a website regardless of whether or not they use it for actual sales. Answer: TRUE Most small businesses-even […]

Factoring is a method of borrowing against payables. Small businesses start small but are intended to grow rapidly, often requiring a team of partners. Answer: FALSE High-growth ventures start small but are intended to grow rapidly, often requiring a team […]

Up-front cash payment by a consumer, prior to shipment of a product, is a payment risk to a company. Among surveys, in-person survey tends to be the least expensive method, with telephone coming in second, and mail the most expensive. […]

A legal obligation to pay money in the future is called equity capital. A buyout refers to starting a business from scratch. Answer: FALSE The purchase of substantially all of an existing business is called a buyout. A trade secret […]

Personal selling decreases business owners’ flexibility in their presentation. The competency suggested by exchange relates to the organizational and business processes of a firm called basic business competency. Answer: FALSE The competency suggested by boundary relates to the organizational and […]

The standard industrial classification system (SIC) codes have six digits. Research suggests that firms without a business plan are less likely to close down than firms with plans. Answer: FALSE Research suggests that firms without a business plan are more […]

Founders of small businesses often find it very difficult to give up decision-making authority to family members. Universalism is an ethical model that suggests people get their ideas of right and wrong from their family, religion, education, and community. Answer: […]

Torts can arise when a person’s legal rights are violated in ways other than from a breach of contract. The Sarbanes-Oxley Act only covers small businesses that are not publicly traded. Answer: FALSE The Sarbanes-Oxley Act is a federal law […]

At times of great change, people become more willing to try extreme new ideas. Traditionally, manufacturing processes are laid out in one of the two formats: grid layout and free-form layout. Answer: FALSE Traditionally, manufacturing processes are laid out in […]

The best way to handle ownership problems is to come out right at the start and specify or negotiate who owns what. There is one specific pattern of entrepreneurial behavior or entrepreneurial type. Answer: FALSE There is no one pattern […]

It costs five times as much to get a purchase from a new customer compared to an existing one. Creating and distributing a catalog online saves the cost of printing and mailing. Answer: TRUE Online catalogs are a less expensive […]

The advantage of legal protection methods for intellectual property is that there are multiple government agencies in each area that will assist a small business owner in maintaining their legal rights. A securities disclaimer on the title page of a […]

Cash-to-cash cycle is also referred to as operating cycle. The bank available balance and the bank ledger balance will always show the same value. Answer: FALSE The bank available balance is the sum of money that has actually been received […]

Operational plans and private placement memos are the only two types of plans that add material to a full business plan. Sales leads who actually make some sort of effort to learn more about the product, service, or business in […]

The concept of total product includes how customers describe one’s good or service. One of the ways harvests take place is through initial public offering or IPO. Answer: TRUE Some of the ways harvests take place are so well known […]

Optimum price is the lowest price that will produce the desired level of sales in an intended market. Business plans are essential for external legitimacy and internal understanding. Answer: TRUE There are two circumstances under which creating a business plan […]

The elevator pitch is much shorter than a vision statement or tagline. Distributors and wholesalers prefer taking on start-up products as there are no setup charges involved. Answer: FALSE Unfortunately for the entrepreneur, many distributors and wholesalers are not interested […]

Pure innovation is an overall strategic approach in which a firm patterns itself on other firms, with the exception of one or two key areas. Shake-out is a type of life cycle growth stage marked by a very rapid increase […]

The two key factors in traditional leadership theories are task and person. Patents are essentially monopolies granted to inventors by the U.S. government giving patent owners the exclusive rights to make, use, or sell that invention for a certain period […]

In the case of mediation, the dispute is put to a neutral third party who has the powers of a judge. According to the rule of thumb in the resource maturity stage, keeping an existing customer costs five times as […]

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. Answer: TRUE The more time and energy one spends preparing […]

Assigning a high value to inventory results in increased sales margin and reported profit, but at the price of paying increased income taxes. One technique to making bootstrapping work is leveraging low costs with free expertise. Answer: TRUE One technique […]

Small-claims courts work only when a person or firms are owed money that can be proved and have exhausted other procedures like calls and letters to the customer. Money borrowed for the purpose of investment in a business is called […]

Setting prices higher than the competition without providing customers with the perception of receiving greater value will lead to lower overall volume. Off-the-job training is delivered to employees while they perform their regular jobs. Answer: FALSE On-the-job training is delivered […]

Off-the-job techniques include apprenticeships, internships, and job rotation. Direct competition refers to a strategy where companies provide alternatives that are dissimilar to a firm’s product/service that consumers might choose to meet a similar need. Answer: FALSE Indirect competition refers to […]

Open space arrangements in workstations increase communication and potentially decrease noise, distractions, and loss of privacy. The outcome/input ratio is the value of the inputs you provide divided by the value of the outcomes you receive in the exchange relationship. […]

Social support cannot improve a person’s self-confidence, but it can help a person withdraw from a stressor. People with a high need for affiliation tend to be more effective in jobs that require them to mediate conflicts. Answer: TRUE People […]

Many of the popular organizational culture models and measures oversimplify the variety of organizational cultures and correctly assume that organizations can easily be identified within these categories. Brooks’s law says that adding more people to a late software project only […]

Organizational countercultures can potentially create conflict and dissension among employees. Equity theory research has found that employees who feel over-rewarded tend to alter their perceptions of inputs and outcomes rather than attempt to actually change them. Answer: TRUE A common […]

Temporary cross-functional teams can be used to encourage informal communication as a coordinating mechanism. The “Big Five” personality dimensions represent five clusters that represent most personality traits. Answer: TRUE The most widely respected clustering of personality traits is the five-factor […]

Employee involvement potentially improves both the decision-making quality and the commitment of employees. Contingencies such as size, technology, and environment do not necessarily determine an organization’s structure. Answer: TRUE Although size, technology, and environment influence the optimal organizational structure, these […]

The representativeness heuristic is a natural tendency to assign higher probabilities to objects or events that are easier to recall from memory. An element of self-leadership involves keeping track of our progress toward goals. Answer: TRUE An element of self-leadership, […]

The view that effective leaders need to be aware of, feel comfortable with, and act consistently with their values, personality, and self-concept is known as transformational leadership. Job evaluation mainly supports the competency approach to rewards. Answer: FALSE Many organizations […]

The self-fulfilling prophecy tends to be stronger when employees are new to the job than when employees have worked in that job for a few years. Job status-based rewards potentially motivate employees to compete with each other. Answer: TRUE Job […]

By avoiding written documentation of how to operate equipment or serve customers, employees are maximizing their expert power through non-substitutability. Mental imagery excludes visualizing completion of a task. Answer: FALSE One part of mental imagery helps us anticipate things that […]

The conflict model starts with the sources of conflict. A manager believes in the philosophy of positive organizational behavior. His self-fulfilling prophecies are likely to improve organizational performance. Answer: TRUE The philosophy of positive organizational behavior suggests that focusing on […]

Multisource feedback is information about an employee’s performance, collected from a full circle of people, including subordinates, peers, supervisors, and customers. Competency-based rewards are consistent with the concept of employability. Answer: TRUE Competency-based rewards improve workforce flexibility and are consistent […]

Mental imagery helps us to anticipate and work out solutions to potential obstacles in our work. Communication refers to the process by which information is transmitted and understood between two or more people. Answer: TRUE Communication refers to the process […]

As people become more powerful they tend to become less goal-oriented, less motivated, and more focused on gaining additional power. Motivation is an external force on the person that causes him/her to engage in specific behaviors. Answer: FALSE Motivation represents […]

Subjective expected utility refers to how much the selected alternative benefits or satisfies the decision maker. Task variability refers to how much the job can be performed using known procedures and rules. Answer: FALSE Task analyzability refers to how much […]

Individuals with high neuroticism usually experience lower stress levels because they are less prone to anxiety. Employees who experience job dissatisfaction, workplace incivility, or work-related stress are more likely to be absent or late for work because taking time off […]

Knowledge-based trust offers a low level of potential and is more unstable because it is exploratory in its nature. It is easier to negotiate on your own turf. Therefore, many negotiators agree to meet in neutral territory. Answer: TRUE It […]

Team members typically hold one or more formal roles in the team as well as roles that they informally fulfill at various times. Most information technologies require less social etiquette and attention, so employees can easily multi-communicate. Answer: TRUE Most […]

The nominal group technique removes the problems of evaluation apprehension and production blocking. An individual’s beliefs about the terms and conditions of a reciprocal exchange agreement between that person and an employer is called a mental model. Answer: FALSE The […]

Teams develop their first real sense of cohesion during the norming stage of team development. When conflict reduces each side’s motivation to communicate, they rely more on stereotypes to reinforce their perceptions of the other side. Answer: TRUE The verbal […]

Corporate social responsibility has no effect on financial performance. People with a high need for achievement tend to avoid risks and prefer working in teams. Answer: FALSE People with a strong need for achievement (nAch) want to accomplish reasonably challenging […]

Diversity awareness programs mainly educate employees about the value of diversity and problems with stereotyping. Buffers tend to resolve conflict by reducing the level of interdependence between the conflicting parties. Answer: TRUE A buffer is any mechanism that loosens the […]

According to the open systems perspective, most organizations have one working part rather than many sub-components. Goal setting is more effective when employees can easily complete the goals assigned to them. Answer: FALSE Challenging goals (rather than easy ones) cause […]

Language reflects an organization’s dominant values but not the values of its subcultures. Increasing the core job characteristics will not increase employee motivation for those who lack the required skills. Answer: TRUE Job design doesn’t increase work motivation for everyone […]