Exam 5: Becoming the Owner of a Small Business

Reintroducing an old product is a good business idea since customer tastes run in cycles.

Small businesses in the U.S. are moving away from synergy as they are trying to reengineer themselves.

Which document provides information to possible new franchisees on twenty items required by the Federal Trade Commission?

Prospective entrepreneurs can access _____ data for information on subjects such as population, business, and housing.

While working in a fast food outlet, Harold observed that most of the customers were working in offices in the neighborhood. Sensing a profitable opportunity, he decided to open a lunch catering business. He offered to deliver lunch directly to the offices so that the businessmen would not have to interrupt their meetings to go somewhere for lunch. In the context of the above scenario, which of the following was the reason for Harold to start his own business?

What are the benefits and drawbacks of buying a franchise?

In the context of small businesses, franchises tend to fail because of unsuccessful marketing.

A problem for franchisees is the high price of supplies that must be bought from the franchiser.

Which of the following is a benefit of buying a franchise?

Jane, who wants to start her own business, considers buying an Internet café which is up for sale in her neighborhood. However, Jane discovers that Internet connectivity tends to be erratic in the store since she lives in a remote town, and decides to not buy this business. Which of the following is most likely the reason for Jane's refusal to buy the business?

What are the methods that a potential entrepreneur should follow to study the market?

The continuous fee paid by the franchisee to the franchiser based on a percentage of the franchisee's gross revenue is known as:

Small businesses must strive for low overhead, use no-frills assets, and look for better real estate deals.

When one wants to start a new business, the first step should be to decide whether to start a new business, buy an existing one, or buy a franchise.

Burger's Inc. owns a number of fast food stores across the country. Ryan, who wants to start his own business, decides to open a store under the Burger's Inc. trademark. He will have to sell and market the fast food products according to the terms of the licensing agreement. In this scenario, Ryan is a:

Which of the following is true of business format franchising?

The Service Corps of Retired Executives publishes many useful books on planning and organizing small businesses.

The industry group with the largest volume of sales in a business format franchising is automobile and truck dealerships.

Which of the following is true of market research in the context of small businesses?

John wants to start his own business. After doing some research, he has decided to specialize in cleaning kitchens since most homemakers are not satisfied with the quality of the service offered by the residential cleaning companies. What is this process of finding a small-but profitable-demand for something and producing a custom-made product or service known as?