Question 1

Which segment is part of the general environment?

Accepted Answer

A) The industry segment 
B) The global segment 
C) The information segment 
D) The human resources segment 
A) The industry segment 
B) The global segment 
C) The information segment 
D) The human resources segment

Question 2

Israel Kirzner believes entrepreneurs have a unique capability, which he calls _________ ________, to spot existing opportunities for businesses.

Accepted Answer

A) innovative thinking 
B) market awareness 
C) entrepreneurial alertness 
D) opportunity recognition 
A) innovative thinking 
B) market awareness 
C) entrepreneurial alertness 
D) opportunity recognition

Question 3

Kitty-Kat Korner fabric shop caters to the quilters in the region.Other fabric shops carry fabrics for all types of clothing along with floral, yarn and other craft supplies.Kitty-Kat carries only items related to quilting.Which of the following best describes Kitty-Kat's strategy?

Accepted Answer

A) focus 
B) cost-based 
C) quality 
D) innovation 
A) focus 
B) cost-based 
C) quality 
D) innovation

Question 4

Using a focus strategy, a company would focus its attention on producing one product that satisfied the greatest number of customers.

Accepted Answer

A) True 
 B)False

Question 5

One of the drawbacks of SWOT analysis is:

Accepted Answer

A) it is very time consuming. 
B) a professional consultant must perform it. 
C) its focus on present conditions. 
D) it requires information about competitors not readily available to outsiders. 
A) it is very time consuming. 
B) a professional consultant must perform it. 
C) its focus on present conditions. 
D) it requires information about competitors not readily available to outsiders.

Question 6

Which statement is an example of a political/legal trend?

Accepted Answer

A) The South African Reserve Bank announces that it will decrease the interest rate it charges banks. 
B) Government passes legislation that increases the tax rates on companies. 
C) A new computer chip is announced which will allow for miniaturisation of many electronic devices. 
D) The EU declares an increase in tariffs on all agricultural goods. 
A) The South African Reserve Bank announces that it will decrease the interest rate it charges banks. 
B) Government passes legislation that increases the tax rates on companies. 
C) A new computer chip is announced which will allow for miniaturisation of many electronic devices. 
D) The EU declares an increase in tariffs on all agricultural goods.

Question 7

The diamond market is monopolised by the De Beers organisation, from mining to cutting and polishing to wholesaling.Jewellers can do little to negotiate prices.This situation typifies:

Accepted Answer

A) low barriers to entry. 
B) availability of substitutes. 
C) intense rivalry. 
D) strong suppliers. 
A) low barriers to entry. 
B) availability of substitutes. 
C) intense rivalry. 
D) strong suppliers.

Question 8

Today's smartphones bear little resemblance to the original analogue cell phones of the early 1990s.Their capabilities exceed those of the early desktop computers.It seems nearly every adult carries at least one cell phone.Which of the trends does this represent?

Accepted Answer

A) Sociocultural 
B) Demographic 
C) Technological 
D) Global 
A) Sociocultural 
B) Demographic 
C) Technological 
D) Global

Question 9

According to a study by the National Federation of Independent Business, the most common source of new product ideas for small business start-ups is:

Accepted Answer

A) prior work experience. 
B) personal interests and hobbies. 
C) a chance happening. 
D) existing records of a business. 
A) prior work experience. 
B) personal interests and hobbies. 
C) a chance happening. 
D) existing records of a business.

Question 10

Miles' start-up company began well but within a couple months he found he was unable to pay invoices from suppliers.He didn't understand how he could have this problem.He hired experts; his business idea was sound; and he had many new customers.What went wrong?

Accepted Answer

A) Miles lacked critical technologies. 
B) Miles lacked patents or copyrights. 
C) Miles lacked raw materials. 
D) Miles lacked cash resources. 
A) Miles lacked critical technologies. 
B) Miles lacked patents or copyrights. 
C) Miles lacked raw materials. 
D) Miles lacked cash resources.

Question 11

Using a cost-based strategy, a company would take steps to increase efficiency and hold down costs.

Accepted Answer

A) True 
 B)False

Question 12

An evaluation of the general environment:

Accepted Answer

A) is done before the feasibility analysis. 
B) helps identify a trend that could be used for a possible start-up idea. 
C) will clarify the unique value of the start-up idea. 
D) will be the primary determinant for a possible start-up idea. 
A) is done before the feasibility analysis. 
B) helps identify a trend that could be used for a possible start-up idea. 
C) will clarify the unique value of the start-up idea. 
D) will be the primary determinant for a possible start-up idea.

Question 13

An example of an idea for a new start-up from an accidental discovery is

Accepted Answer

A) a coin collector, who bought and sold coins for years to build a personal collection, deciding to become a coin dealer. 
B) a furniture salesperson seeing the possibility of opening a new furniture store in a different area of the city. 
C) a sharpshooter, who shot holes in a pair of her boyfriend's jeans during an argument, hearing him get complimented on the way they look. 
D) all of the above are examples. 
A) a coin collector, who bought and sold coins for years to build a personal collection, deciding to become a coin dealer. 
B) a furniture salesperson seeing the possibility of opening a new furniture store in a different area of the city. 
C) a sharpshooter, who shot holes in a pair of her boyfriend's jeans during an argument, hearing him get complimented on the way they look. 
D) all of the above are examples.

Question 14

Richard could see the demand for towable recreational vehicles declining so beginning in the early 1970s he used his equipment, employee, and professional network to design and build utility trucks, a more recession-resistant industry.This is an example of:

Accepted Answer

A) serendipity. 
B) diversification. 
C) innovative thinking 
D) market ideas. 
A) serendipity. 
B) diversification. 
C) innovative thinking 
D) market ideas.

Question 15

An inside-out analysis identifies a company's strengths and the competition's weaknesses.

Accepted Answer

A) True 
 B)False

Question 16

Serendipity describes a new product idea resulting from deliberate search activities.

Accepted Answer

A) True 
 B)False

Question 17

Alyson and Andrea, country artists, realised that their love of classic rock was also popular with their fans.Their change to their show to incorporate more rock songs with a country flavour is an example of:

Accepted Answer

A) recognising a hot trend and riding the wave. 
B) combining two businesses into one to create a market opening. 
C) beginning with a problem in mind. 
D) finding a way to adapt a product or service to meet customer needs in a different way. 
A) recognising a hot trend and riding the wave. 
B) combining two businesses into one to create a market opening. 
C) beginning with a problem in mind. 
D) finding a way to adapt a product or service to meet customer needs in a different way.

Question 18

TV commercials promote security systems and vehicle tracking.Other ads promote medications for high blood pressure, immune system disorders and high cholesterol.Which type of trend do these represent?

Accepted Answer

A) Sociocultural 
B) Global 
C) Technological 
D) Demographic 
A) Sociocultural 
B) Global 
C) Technological 
D) Demographic

Question 19

Containers Etc.manufactures household containers.In contrast to traditional market designs, all of the products are microwaveable, child-proof and come in an assortment of 35 colours.Accordingly, Containers Etc.is pursuing a _____ strategy.

Accepted Answer

A) product-based 
B) differentiation-based 
C) concept-based 
D) efficiency-based 
A) product-based 
B) differentiation-based 
C) concept-based 
D) efficiency-based

Question 20

Which statement is an example of a technological trend?

Accepted Answer

A) The South African Reserve Bank announces that it will decrease the interest rate it charges banks. 
B) Government passes legislation that increases the tax rates on companies. 
C) A new computer chip is announced which will allow for miniaturisation of many electronic devices. 
D) The EU announces an increase in tariffs on all agricultural goods. 
A) The South African Reserve Bank announces that it will decrease the interest rate it charges banks. 
B) Government passes legislation that increases the tax rates on companies. 
C) A new computer chip is announced which will allow for miniaturisation of many electronic devices. 
D) The EU announces an increase in tariffs on all agricultural goods.

Exam 3: Starting a Small Business

Which segment is part of the general environment?

Israel Kirzner believes entrepreneurs have a unique capability, which he calls _________ ________, to spot existing opportunities for businesses.

Kitty-Kat Korner fabric shop caters to the quilters in the region.Other fabric shops carry fabrics for all types of clothing along with floral, yarn and other craft supplies.Kitty-Kat carries only items related to quilting.Which of the following best describes Kitty-Kat's strategy?

Using a focus strategy, a company would focus its attention on producing one product that satisfied the greatest number of customers.

One of the drawbacks of SWOT analysis is:

Which statement is an example of a political/legal trend?

The diamond market is monopolised by the De Beers organisation, from mining to cutting and polishing to wholesaling.Jewellers can do little to negotiate prices.This situation typifies:

Today's smartphones bear little resemblance to the original analogue cell phones of the early 1990s.Their capabilities exceed those of the early desktop computers.It seems nearly every adult carries at least one cell phone.Which of the trends does this represent?

According to a study by the National Federation of Independent Business, the most common source of new product ideas for small business start-ups is:

Miles' start-up company began well but within a couple months he found he was unable to pay invoices from suppliers.He didn't understand how he could have this problem.He hired experts; his business idea was sound; and he had many new customers.What went wrong?

Using a cost-based strategy, a company would take steps to increase efficiency and hold down costs.

An evaluation of the general environment:

An example of an idea for a new start-up from an accidental discovery is

Richard could see the demand for towable recreational vehicles declining so beginning in the early 1970s he used his equipment, employee, and professional network to design and build utility trucks, a more recession-resistant industry.This is an example of:

An inside-out analysis identifies a company's strengths and the competition's weaknesses.

Serendipity describes a new product idea resulting from deliberate search activities.

Alyson and Andrea, country artists, realised that their love of classic rock was also popular with their fans.Their change to their show to incorporate more rock songs with a country flavour is an example of:

TV commercials promote security systems and vehicle tracking.Other ads promote medications for high blood pressure, immune system disorders and high cholesterol.Which type of trend do these represent?

Containers Etc.manufactures household containers.In contrast to traditional market designs, all of the products are microwaveable, child-proof and come in an assortment of 35 colours.Accordingly, Containers Etc.is pursuing a _____ strategy.

Which statement is an example of a technological trend?

The Entrepreneurial Life

Integrity, Ethics And, Social Entrepreneurship

Franchising and Buyouts

The Family Business

The Business Plan: Visualizing the Dream

The Marketing Plan

The Organizational Plan: Teams, Legal Structures, Alliances, and Directors

The Location Plan

Understanding a Firms Financial Statements

Forecasting Financial Requirements

A Firms Sources of Financing

Planning for the Harvest

Building Customer Relationships

Product and Supply Chain Management

Pricing and Credit Decisions

Promotional Planning

Global Opportunities for Small Business

Professional Management and the Small Business

Managing Human Resources

Managing Operations

Managing the Firms Assets

Managing Risk in the Small Business

Filters

Israel Kirzner believes entrepreneurs have a unique capability, which he calls _ , to spot existing opportunities for businesses.