Question 1

The fundamental equation for liquidation planning is:

Accepted Answer

A)  Opening liquid assets + pay-ins - pay-outs = cash flow 
B)  Opening liquid assets + pay-ins - pay-outs = closing liquid assets 
C)  Opening liquid assets + income - costs = closing liquid assets 
D)  Opening liquid assets +/- gains/losses = closing liquid assets 
A)  Opening liquid assets + pay-ins - pay-outs = cash flow 
B)  Opening liquid assets + pay-ins - pay-outs = closing liquid assets 
C)  Opening liquid assets + income - costs = closing liquid assets 
D)  Opening liquid assets +/- gains/losses = closing liquid assets B

Question 2

Decisions in the upper part of the BMC about quality, prices, service, terms of delivery, inventory, terms of payment, returns policy, discounts, marketing, etc. are translated into gains or losses in liquidity planning.

Accepted Answer

A) True 
 B)False  False

Question 3

The book differentiates between customer value and economic value as business models and the propositions they deliver. The point with differentiating between the two is to show that:

Accepted Answer

A)  economic value precedes the customer value, not the other way around 
B)  economic value is a monetary value extracted from the customer value 
C)  a business model can create customer value without creating economic value 
D)  customer value is the economic value of the customer to the company 
E)  customer value is the company's aggregate revenue from a customer 
A)  economic value precedes the customer value, not the other way around 
B)  economic value is a monetary value extracted from the customer value 
C)  a business model can create customer value without creating economic value 
D)  customer value is the economic value of the customer to the company 
E)  customer value is the company's aggregate revenue from a customer B,C

Question 4

The book addresses a number of fundamental questions around liquidity and profitability. The term connected to the question "Do we have enough money?" is:

Accepted Answer

A)  Liquidity 
B)  Profitability 
A)  Liquidity 
B)  Profitability

Question 5

One needs to calculate how much money will be needed to start the business in the first place - otherwise known as …….. .

Accepted Answer

The answer of One needs to calculate how much money...

Question 6

Profits are needed for more than compensating the owners; for any young company that needs to grow they are an essential source of financing! Without profits, the company's ……….. will grow, which will decrease the company's chances of survival.

Accepted Answer

The answer of Profits are needed for more than compensating...

Question 7

Post-purchase, cash and advanced are three payment alternatives with decidedly different consequences as to the amount of investments that will be needed, and will have to be managed and financed.

Accepted Answer

A) True 
 B)False

Question 8

If the following equation ends in a minus (-), you have a liquidation problem.
Opening liquid assets + pay-ins - pay-outs = closing liquid assets

Accepted Answer

A) True 
 B)False

Question 9

How much do we need to invest to get started? In other words how much ……… will be required?

Accepted Answer

The answer of How much do we need to invest...

Question 10

Another term from the BMC which expresses that revenue can come from a variety of sources is:

Accepted Answer

A)  payments 
B)  revenue sources 
C)  income flow 
D)  revenue streams 
A)  payments 
B)  revenue sources 
C)  income flow 
D)  revenue streams

Question 11

Liquidity planning forces a company to:

Accepted Answer

A)  think about offering customers a longer credit period 
B)  think about the timing between when the money comes in and when it needs to be paid out to various parties 
C)  try to pay suppliers in advance 
D)  try to increase margins and profits 
A)  think about offering customers a longer credit period 
B)  think about the timing between when the money comes in and when it needs to be paid out to various parties 
C)  try to pay suppliers in advance 
D)  try to increase margins and profits

Question 12

The following formula is used to calculate the anticipated result:

Accepted Answer

A)  = anticipated fixed costs - anticipated variable costs 
B)  = anticipated pay-ins - anticipated pay-outs 
C)  = anticipated income - anticipated expenses 
D)  = anticipated income - anticipated costs 
A)  = anticipated fixed costs - anticipated variable costs 
B)  = anticipated pay-ins - anticipated pay-outs 
C)  = anticipated income - anticipated expenses 
D)  = anticipated income - anticipated costs

Question 13

Post-purchase, cash and advanced are three payment alternatives with decidedly different consequences as to the amount of working capital that will be needed, and will have to be managed and financed.

Accepted Answer

A) True 
 B)False

Question 14

Profits are crucial to survival in the longer term since they are needed to cover the costs of developing the business and to render a return to investors/owners in return for the risk they have taken.

Accepted Answer

A) True 
 B)False

Question 15

The main purpose of the gross margin is to cover fixed costs, and when it does, you have your break-even point.

Accepted Answer

A) True 
 B)False

Question 16

Profits are mainly needed to compensate the owners for the work they have invested.

Accepted Answer

A) True 
 B)False

Question 17

To keep liquidity firmly in mind implies that one:

Accepted Answer

A)  controls income and costs 
B)  ensures that margins are converted into money in 
C)  ensures there is enough money to run the business at various stages 
D)  ensures there are profits and that they are used in the right way 
A)  controls income and costs 
B)  ensures that margins are converted into money in 
C)  ensures there is enough money to run the business at various stages 
D)  ensures there are profits and that they are used in the right way

Question 18

This consolidation of the company is described as increasing the company's ……….. and is taken by others as a measure of a company's ability to withstand and survive the trials.

Accepted Answer

The answer of This consolidation of the company is described...

Question 19

Startup costs are usually considered in the categories ……….. and other initial costs.

Accepted Answer

The answer of Startup costs are usually considered in the...

Question 20

As a rule of thumb, gross margins of 40 percent and up are deemed viable. Margins under 20 percent are termed "razor thin."

Accepted Answer

A) True 
 B)False

The fundamental equation for liquidation planning is:

Decisions in the upper part of the BMC about quality, prices, service, terms of delivery, inventory, terms of payment, returns policy, discounts, marketing, etc. are translated into gains or losses in liquidity planning.

The book differentiates between customer value and economic value as business models and the propositions they deliver. The point with differentiating between the two is to show that:

The book addresses a number of fundamental questions around liquidity and profitability. The term connected to the question "Do we have enough money?" is:

One needs to calculate how much money will be needed to start the business in the first place - otherwise known as …….. .

Profits are needed for more than compensating the owners; for any young company that needs to grow they are an essential source of financing! Without profits, the company's ……….. will grow, which will decrease the company's chances of survival.

Post-purchase, cash and advanced are three payment alternatives with decidedly different consequences as to the amount of investments that will be needed, and will have to be managed and financed.

If the following equation ends in a minus (-), you have a liquidation problem. Opening liquid assets + pay-ins - pay-outs = closing liquid assets

How much do we need to invest to get started? In other words how much ……… will be required?

Another term from the BMC which expresses that revenue can come from a variety of sources is:

Liquidity planning forces a company to:

The following formula is used to calculate the anticipated result:

Post-purchase, cash and advanced are three payment alternatives with decidedly different consequences as to the amount of working capital that will be needed, and will have to be managed and financed.

Profits are crucial to survival in the longer term since they are needed to cover the costs of developing the business and to render a return to investors/owners in return for the risk they have taken.

The main purpose of the gross margin is to cover fixed costs, and when it does, you have your break-even point.

Profits are mainly needed to compensate the owners for the work they have invested.

To keep liquidity firmly in mind implies that one:

This consolidation of the company is described as increasing the company's ……….. and is taken by others as a measure of a company's ability to withstand and survive the trials.

Startup costs are usually considered in the categories ……….. and other initial costs.

As a rule of thumb, gross margins of 40 percent and up are deemed viable. Margins under 20 percent are termed "razor thin."

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Exam 7: The Business Models Financial Abcs

The fundamental equation for liquidation planning is:

Decisions in the upper part of the BMC about quality, prices, service, terms of delivery, inventory, terms of payment, returns policy, discounts, marketing, etc. are translated into gains or losses in liquidity planning.

The book differentiates between customer value and economic value as business models and the propositions they deliver. The point with differentiating between the two is to show that:

The book addresses a number of fundamental questions around liquidity and profitability. The term connected to the question "Do we have enough money?" is:

One needs to calculate how much money will be needed to start the business in the first place - otherwise known as …….. .

Profits are needed for more than compensating the owners; for any young company that needs to grow they are an essential source of financing! Without profits, the company's ……….. will grow, which will decrease the company's chances of survival.

Post-purchase, cash and advanced are three payment alternatives with decidedly different consequences as to the amount of investments that will be needed, and will have to be managed and financed.

If the following equation ends in a minus (-), you have a liquidation problem. Opening liquid assets + pay-ins - pay-outs = closing liquid assets

How much do we need to invest to get started? In other words how much ……… will be required?

Another term from the BMC which expresses that revenue can come from a variety of sources is:

Liquidity planning forces a company to:

The following formula is used to calculate the anticipated result:

Post-purchase, cash and advanced are three payment alternatives with decidedly different consequences as to the amount of working capital that will be needed, and will have to be managed and financed.

Profits are crucial to survival in the longer term since they are needed to cover the costs of developing the business and to render a return to investors/owners in return for the risk they have taken.

The main purpose of the gross margin is to cover fixed costs, and when it does, you have your break-even point.

Profits are mainly needed to compensate the owners for the work they have invested.

To keep liquidity firmly in mind implies that one:

This consolidation of the company is described as increasing the company's ……….. and is taken by others as a measure of a company's ability to withstand and survive the trials.

Startup costs are usually considered in the categories ……….. and other initial costs.

As a rule of thumb, gross margins of 40 percent and up are deemed viable. Margins under 20 percent are termed "razor thin."

The Rise, Fall and Return of the Entrepreneur

Environment

People

Opportunity

The Process

The Business Model

Filters