A public stock sale is an effective method of raising large amounts of capital, but it can
be an expensive and time-consuming process filled with regulatory nightmares.
Ethical behavior is doing what is “right.”
Publicly-held companies must file periodic reports with the Securities and Exchange
Commission.
A creditor’s claim against an asset is referred to as lien.
Successful entrepreneurship requires left-brain thinking.
Below-market pricing strategies can be risky for small companies because they require
businesses to constantly achieve high sales volume to remain competitive.
The specific group of customers at whom a company aims its goods and services is its
target market.
A mashup is a Web site or an application that combines content from multiple sources
into a single Web service.
When the cost of transporting a product is high relative to its value, locating close to the
market a manufacturer plans to serve is critical.
The net-sales-to-total assets ratio measures a company’s ability to generate sales in
relation to its asset base.
If the accounting period is one year with credit sales totaling $2,500,000 and accounts
receivable totaling $200,000, the average collection period ratio is ________.
A) 29.2 days
B) 365 days
C) 119.3 days
D) Cannot be determined from the information provided
Entrepreneurs should make sure they do not fall victim to any of the e-commerce
myths. Which of the following is not an e-commerce myth?
A) Setting up a business on the Web is easy and inexpensive.
B) If I launch a site, customers will flock to it.
C) Making money on the Web is easy.
D) Privacy and site security is an important issue on the Web.
Creating projected (pro forma)financial statements would allow a business owner to
answer which of the following questions?
A) What profit can my business expect to achieve?
B) What sales level must my business reach if our targeted profit is X dollars?
C) What fixed and variable expenses can my business expect to incur at our targeted
sales level?
D) All of the above
Cora arrived at work at 7 a.m. today, and she will get off at 4 p.m. so that she can watch
her son’s soccer game. Her office mate, Emma, is not a “morning person” and usually
arrives at the office at 10 a.m. and gets off at 7 p.m. Their company uses ________.
A) job sharing
B) flextime
C) flexplace
D) job enrichment
All of the following are effective ways to encourage customers to return to a site except
________.
A) offer “frequent buyer” programs
B) clearly state prices and shipping charges
C) advertise with “pop-ups”
D) provide a search function
All of the following represent benefits of selling on the Web except ________.
A) opportunity to increase revenues
B) power to educate and inform
C) ability to remain open 24 hours a day
D) ability to advertise in a cheaper media form
Important factors to investigate regarding the business to be purchased include
________.
A) assessing the physical assets of the business
B) reviewing accounts receivable and business records
C) reviewing contractual arrangements and assessing intangible assets
D) All of the above
Which of the following generally is not required by a Certificate of Incorporation?
A) The names and the addresses of the incorporators.
B) A statement of the corporation’s purpose.
C) A statement of how stock proceeds will be used.
D) The corporation’s bylaws.
________ is a written statement of the standards of behavior and ethical principles a
company expects from its employees.
A) Company credo
B) Company annual report
C) Company vision
D) Code of ethics
Cost of goods sold is located on which financial statement?
A) Income statement
B) Balance sheet
C) Statement of cash flows
D) All of the above
When estimating the firm’s end-of-month cash balance, the owner should first
________.
A) determine the cash balance at the beginning of the month
B) add up total cash receipts and subtract cash on hand
C) review the accounts receivable
D) make a daily list of cash disbursements
A survey by PriceWaterhouseCoopers reports that ________ percent of Americans
research products online before buying them.
A) 40
B) 42
C) 60
D) 83
What can a company do to achieve stellar customer service and satisfaction?
A) Listen to customers with the help of suggestion boxes, focus groups, surveys, and
other tools.
B) Define what ‘superior service” means so that customers and employees know exactly
what to expect and what to provide.
C) Hire friendly, courteous sales and service representatives.
D) All of the above
Which of the following is not a recommended method of collecting competitive
intelligence?
A) Attend trade shows and collect competitors’ sales literature.
B) Buy competitors’ products or services and assess their quality and features,
benchmarking their products and services against yours.
C) Pay competitors’ employees to become informants about their companies’ strategies,
markets, and trade secrets.
D) Watch for employment ads from competitors to determine the types of workers they
are hiring.