Question 1

Discuss several ways the Small Business Administration assists entrepreneurs.

Accepted Answer

a. The SBA is a valuable source of information and technical advice for small businesspeople.
b. The SBA also provides financial assistance to small businesses through a variety of programs. The SBA will sometimes provide direct loans to firms that have difficulty securing conventional loans from private sources. The SBA also provides programs to help minorities and women obtain funds.
c. The SBA licenses SBICs, which are private investment companies that loan money to small businesses.
d. The SBA operates SCORE, the Service Corps of Retired Executives. This group provides counseling and advice to small business owners.

Question 2

Which of the following is a characteristic of successful entrepreneurs?

Accepted Answer

A)  Power-seeking 
B)  Relies heavily on others who believe in the business 
C)  Willingness and desire to follow others 
D)  Action-oriented 
A)  Power-seeking 
B)  Relies heavily on others who believe in the business 
C)  Willingness and desire to follow others 
D)  Action-oriented D

Question 3

Hiring family members offers the best answer to the problem of attracting qualified employees.

Accepted Answer

A) True 
 B)False  False

Question 4

Commercial loan officers and insurance agents offer expert assistance that can be valuable to small business owners.

Accepted Answer

A) True 
 B)False

Question 5

While entrepreneurs frequently earn significant profits for themselves, their impact on society is quite small.

Accepted Answer

A) True 
 B)False

Question 6

About 80% of U.S. workers find their first job in small business.

Accepted Answer

A) True 
 B)False

Question 7

The Internet has slowed small businesses' participation in international markets.

Accepted Answer

A) True 
 B)False

Question 8

The business opportunities with the greatest growth potential tend to be in the high technology industries.

Accepted Answer

A) True 
 B)False

Question 9

Mohamed's four employees have been with him since he opened Employment Experts, Inc., nearly a decade ago. As he anticipates staffing his new branch office, he decides none of these four long-time employees are ready to manage the office. Faced with this difficult situation, what should Mohamed do?

Accepted Answer

A)  He should appoint one of the three anyway to show that he appreciates their loyalty and commitment. 
B)  He should run the new branch himself and appoint one of the three to take over the original office. 
C)  He should hire a new qualified employee to manage the office since utilizing his unready employees could be detrimental to the business. 
D)  He should appoint all three to the new branch and let them run it using a team approach. 
A)  He should appoint one of the three anyway to show that he appreciates their loyalty and commitment. 
B)  He should run the new branch himself and appoint one of the three to take over the original office. 
C)  He should hire a new qualified employee to manage the office since utilizing his unready employees could be detrimental to the business. 
D)  He should appoint all three to the new branch and let them run it using a team approach.

Question 10

From a competitive standpoint, small businesses cannot expect to successfully compete with large corporations in international markets.

Accepted Answer

A) True 
 B)False

Question 11

The entrepreneur's integrity is not relevant to bankers when determining the creditworthiness of a business loan.

Accepted Answer

A) True 
 B)False

Question 12

Kyle is a recent college graduate with a business degree. While still in school, he learned that as a potential small business owner, he should focus his sights on domestic business only.

Accepted Answer

A) True 
 B)False

Question 13

To be considered part of a market, an individual must

Accepted Answer

A)  be a registered buyer. 
B)  have made a purchase within the past 30 days. 
C)  know the names and addresses of two or more sellers. 
D)  have both a willingness to buy and the financial resources needed to buy. 
A)  be a registered buyer. 
B)  have made a purchase within the past 30 days. 
C)  know the names and addresses of two or more sellers. 
D)  have both a willingness to buy and the financial resources needed to buy.

Question 14

Small businesses create about ________ percent of the new jobs in the United States.

Accepted Answer

A)  25 
B)  45 
C)  65 
D)  85 
A)  25 
B)  45 
C)  65 
D)  85

Question 15

Quinn has landed a management position with a pioneering new small business after many years of working as a regional manager for a nationally known nonprofit. As Quinn starts her new job, she is likely to find that

Accepted Answer

A)  due to the significant differences in large and small firms, her previous experience will be of little value in her new position. 
B)  the principles of management are much the same at large and small firms. 
C)  nonprofit organizations are motivated by their desire to help people and so financial management is of little concern. 
D)  planning is more important to a nonprofit organization and less important to a small business so she will need to adjust the time she spends on the planning function. 
A)  due to the significant differences in large and small firms, her previous experience will be of little value in her new position. 
B)  the principles of management are much the same at large and small firms. 
C)  nonprofit organizations are motivated by their desire to help people and so financial management is of little concern. 
D)  planning is more important to a nonprofit organization and less important to a small business so she will need to adjust the time she spends on the planning function.

Question 16

When comparing small businesses to their larger competitors, it is clear that

Accepted Answer

A)  bigger is always better. 
B)  small firms can always outperform big firms on a level playing field. 
C)  small firms often can offer more personalized customer services than big firms. 
D)  small firms are slower to respond to opportunities than are large firms. 
A)  bigger is always better. 
B)  small firms can always outperform big firms on a level playing field. 
C)  small firms often can offer more personalized customer services than big firms. 
D)  small firms are slower to respond to opportunities than are large firms.

Question 17

After Abby graduated from college last year, her uncle created an accounting position for her in his business. Her older brother is in charge of purchasing inventory for the store, yet often the store runs out of popular items or is overstocked with products that must be marked down to be sold. Abby is confident that her brother is more suited for handling accounting and finance, while she has a sense of what sells and how much sells. Although she has spoken with her uncle about it a couple of times, he seems reluctant to change. As the founder of the business, he may

Accepted Answer

A)  find it difficult to remove family members from positions, even if it is not good for the business. 
B)  find it difficult to retrain Abby for the job, and even though his business is losing opportunities, he will stay the course. 
C)  know that profit margins have declined, but he doesn't care. 
D)  have a bigger picture of things, and not feel the need to respond to a family member's request. 
A)  find it difficult to remove family members from positions, even if it is not good for the business. 
B)  find it difficult to retrain Abby for the job, and even though his business is losing opportunities, he will stay the course. 
C)  know that profit margins have declined, but he doesn't care. 
D)  have a bigger picture of things, and not feel the need to respond to a family member's request.

Question 18

The Small Business Administration's microloan program awards loans to entrepreneurs based primarily on their

Accepted Answer

A)  collateral. 
B)  credit history. 
C)  previous business success. 
D)  integrity and sound business idea. 
A)  collateral. 
B)  credit history. 
C)  previous business success. 
D)  integrity and sound business idea.

Question 19

Angelina recently left her job at a large corporation to start her own business. She knows that her decision comes with risk, but she is excited to be her own boss and to tackle the challenges that running her own company will bring. Angelina is an example of a(n)

Accepted Answer

A)  intrapreneur. 
B)  entrepreneur. 
C)  venture capitalist. 
D)  raconteur. 
A)  intrapreneur. 
B)  entrepreneur. 
C)  venture capitalist. 
D)  raconteur.

Question 20

Intrapreneurs make use of ________ to develop and launch new products and generate new profits.

Accepted Answer

A)  their employer's existing human, financial, and physical resources 
B)  their own personal financial resources 
C)  government-supplied physical and financial resources 
D)  old ideas abandoned by entrepreneurs 
A)  their employer's existing human, financial, and physical resources 
B)  their own personal financial resources 
C)  government-supplied physical and financial resources 
D)  old ideas abandoned by entrepreneurs

Exam 6: Entrepreneurship and Starting a Small Business

Discuss several ways the Small Business Administration assists entrepreneurs.

Which of the following is a characteristic of successful entrepreneurs?

Hiring family members offers the best answer to the problem of attracting qualified employees.

Commercial loan officers and insurance agents offer expert assistance that can be valuable to small business owners.

While entrepreneurs frequently earn significant profits for themselves, their impact on society is quite small.

About 80% of U.S. workers find their first job in small business.

The Internet has slowed small businesses' participation in international markets.

The business opportunities with the greatest growth potential tend to be in the high technology industries.

Mohamed's four employees have been with him since he opened Employment Experts, Inc., nearly a decade ago. As he anticipates staffing his new branch office, he decides none of these four long-time employees are ready to manage the office. Faced with this difficult situation, what should Mohamed do?

From a competitive standpoint, small businesses cannot expect to successfully compete with large corporations in international markets.

The entrepreneur's integrity is not relevant to bankers when determining the creditworthiness of a business loan.

Kyle is a recent college graduate with a business degree. While still in school, he learned that as a potential small business owner, he should focus his sights on domestic business only.

To be considered part of a market, an individual must

Small businesses create about ________ percent of the new jobs in the United States.

Quinn has landed a management position with a pioneering new small business after many years of working as a regional manager for a nationally known nonprofit. As Quinn starts her new job, she is likely to find that

When comparing small businesses to their larger competitors, it is clear that

The Small Business Administration's microloan program awards loans to entrepreneurs based primarily on their

Angelina recently left her job at a large corporation to start her own business. She knows that her decision comes with risk, but she is excited to be her own boss and to tackle the challenges that running her own company will bring. Angelina is an example of a(n)

Intrapreneurs make use of ________ to develop and launch new products and generate new profits.

Taking Risks and Making Profits Within the Dynamic Business Environment

Understanding Economics and How It Affects Business

Doing Business in Global Markets

Demanding Ethical and Socially Responsible Behavior

How to Form a Business

Management and Leadership

Structuring Organizations for Todays Challenges

Production and Operations Management

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Dealing With Employeemanagement Issues

Marketing: Helping Buyers Buy

Developing and Pricing Goods and Services

Distributing Products

Using Effective Promotions

Understanding Accounting and Financial Information

Financial Management

Using Securities Markets for Financing and Investing Opportunities

Money, Financial Institutions, and the Federal Reserve

Appendix: Working Within the Legal Environment

Appendix: Using Technology to Manage Information

Appendix: Managing Risk

Appendix: Managing Personal Finances

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