Question 1

All of the following are true of direct selling EXCEPT

Accepted Answer

A)  the cost of getting involved is low. 
B)  it can be done part time. 
C)  it requires buying a lot of inventory. 
D)  those who do it can receive commissions on their sales. 
E)  those who do it have the opportunity to recruit other distributors. 
A)  the cost of getting involved is low. 
B)  it can be done part time. 
C)  it requires buying a lot of inventory. 
D)  those who do it can receive commissions on their sales. 
E)  those who do it have the opportunity to recruit other distributors. C

Question 2

What is true of wholesalers?

Accepted Answer

A)  Wholesalers cannot be eliminated because their functions are too important. 
B)  Wholesalers receive their products from retailers. 
C)  Wholesalers do not provide management or merchandising assistance to clients. 
D)  Wholesalers do not perform marketing activities. 
E)  Wholesalers are extremely important because of the marketing activities they perform. 
A)  Wholesalers cannot be eliminated because their functions are too important. 
B)  Wholesalers receive their products from retailers. 
C)  Wholesalers do not provide management or merchandising assistance to clients. 
D)  Wholesalers do not perform marketing activities. 
E)  Wholesalers are extremely important because of the marketing activities they perform. E

Question 3

Small businesses, by their very nature, are small and therefore do not contribute significantly to job creation.

Accepted Answer

A) True 
 B)False  False

Question 4

Jayla wants to open her own business making cakes. She has $10,000 of her own money and receives another $20,000 from family and friends. This combined $30,000 that Jayla can use toward her new business is referred to as

Accepted Answer

A)  capital. 
B)  a mortgage. 
C)  operating income. 
D)  the initial inventory 
E)  a line of credit. 
A)  capital. 
B)  a mortgage. 
C)  operating income. 
D)  the initial inventory 
E)  a line of credit.

Question 5

What is true regarding the reputation of small businesses?

Accepted Answer

A)  Small businesses likely have multiple locations, and it is difficult to maintain customer service across locations. 
B)  Because of their capacity to focus on narrow niches, small businesses can develop enviable reputations for quality and service. 
C)  Since small business employees are often stretched thin by the amount of work they have, their reputations are not as good as larger businesses with more employees. 
D)  Small businesses often have to cut corners in creating their products, so they have a poor reputation for quality. 
E)  Small businesses tend to focus more on service than quality, so their reputation is inconsistent. 
A)  Small businesses likely have multiple locations, and it is difficult to maintain customer service across locations. 
B)  Because of their capacity to focus on narrow niches, small businesses can develop enviable reputations for quality and service. 
C)  Since small business employees are often stretched thin by the amount of work they have, their reputations are not as good as larger businesses with more employees. 
D)  Small businesses often have to cut corners in creating their products, so they have a poor reputation for quality. 
E)  Small businesses tend to focus more on service than quality, so their reputation is inconsistent.

Question 6

Rosemary was born in 1952. She is a wealthy North Carolina native. As she ages, Rosemary spends more of her money on travel, financial planning, and health care. Rosemary is a(n)

Accepted Answer

A)  millennial. 
B)  echo boomer. 
C)  baby boomer. 
D)  immigrant. 
E)  member of Generation Y. 
A)  millennial. 
B)  echo boomer. 
C)  baby boomer. 
D)  immigrant. 
E)  member of Generation Y.

Question 7

Kaden and Elizabeth run a small farm stand on their property, selling vegetables, fruits, and plants to support themselves. During a particularly bad growing season, they try to get financing from a small rural bank in their community but they do not get it. What is the most likely reason for this?

Accepted Answer

A)  The small rural bank believed that their business lacked the flexibility to adapt to changing market demands. 
B)  The bank required a huge sum of money to compete in the mass market. 
C)  Government regulations do not permit financing small rural businesses. 
D)  The small rural bank lacked the necessary financial expertise to counter the risks involved with small-business loans. 
E)  Rural communities have various business guidelines that prohibit rural banks from financing small businesses. 
A)  The small rural bank believed that their business lacked the flexibility to adapt to changing market demands. 
B)  The bank required a huge sum of money to compete in the mass market. 
C)  Government regulations do not permit financing small rural businesses. 
D)  The small rural bank lacked the necessary financial expertise to counter the risks involved with small-business loans. 
E)  Rural communities have various business guidelines that prohibit rural banks from financing small businesses.

Question 8

What type of business has been growing faster than other classifiable firms and represents almost 30 percent of all small businesses?

Accepted Answer

A)  family-owned businesses 
B)  minority-owned businesses 
C)  publicly-owned businesses 
D)  social entrepreneurships 
E)  small corporations 
A)  family-owned businesses 
B)  minority-owned businesses 
C)  publicly-owned businesses 
D)  social entrepreneurships 
E)  small corporations

Question 9

Which group represents over 17 percent of those living in the United States and is largely employed in the retail industry?

Accepted Answer

A)  females 
B)  baby boomers 
C)  immigrants 
D)  retired executives 
E)  males 
A)  females 
B)  baby boomers 
C)  immigrants 
D)  retired executives 
E)  males

Question 10

Marissa is a fitness expert who starts her own personal training company. She conducts fitness classes for women and provides personal training sessions for clients. Marissa can be regarded as a(n)

Accepted Answer

A)  shareholder. 
B)  entrepreneur. 
C)  investor. 
D)  intrapreneur. 
E)  inventor. 
A)  shareholder. 
B)  entrepreneur. 
C)  investor. 
D)  intrapreneur. 
E)  inventor.

Question 11

It has often been said that the greatest impediment to the success of a small business is

Accepted Answer

A)  the entrepreneur. 
B)  the government. 
C)  overcapitalization. 
D)  the business environment. 
E)  too many target markets. 
A)  the entrepreneur. 
B)  the government. 
C)  overcapitalization. 
D)  the business environment. 
E)  too many target markets.

Question 12

Manuel wants to start his own small business. All of the following are things he must to do to start a business EXCEPT

Accepted Answer

A)  hire employees to work for the business. 
B)  have a general idea for the business. 
C)  devise a strategy to guide planning and development in the business. 
D)  make decisions about form of ownership. 
E)  make decisions about financial resources needed. 
A)  hire employees to work for the business. 
B)  have a general idea for the business. 
C)  devise a strategy to guide planning and development in the business. 
D)  make decisions about form of ownership. 
E)  make decisions about financial resources needed.

Question 13

While growing up, Carlos noticed that many families in his community struggled to make ends meet and provide for their children's education. As a result, he started a business to provide low-cost tutoring and scholarship opportunities for low-income families in his community. As his company has grown, Carlos has been able to extend free tutoring and college scholarships to five impoverished students per year. Carlos is a

Accepted Answer

A)  nonprofit entrepreneur. 
B)  profit entrepreneur. 
C)  social entrepreneur. 
D)  sharing entrepreneur. 
E)  macroentrepreneur. 
A)  nonprofit entrepreneur. 
B)  profit entrepreneur. 
C)  social entrepreneur. 
D)  sharing entrepreneur. 
E)  macroentrepreneur.

Question 14

Menami and Michael recently had their first child. As two working parents, they struggled to find good, economical childcare. As a result, they developed their own software to link parents with licensed, reasonably priced childcare providers. This is an example of the

Accepted Answer

A)  sharing economy. 
B)  market segment economy. 
C)  service economy. 
D)  retail economy. 
E)  consumer economy. 
A)  sharing economy. 
B)  market segment economy. 
C)  service economy. 
D)  retail economy. 
E)  consumer economy.

Question 15

Juanita wants to run her own bowling alley, but she does not want to start it from scratch. She decides to buy an existing business. What is one advantage of doing this?

Accepted Answer

A)  It allows her to know all the problems the business already has. 
B)  It gives her the freedom to develop exactly the business she wants. 
C)  It eliminates all the costs Juanita would normally have in starting a business. 
D)  It provides a built-in network of customers, suppliers, and distributors. 
E)  It eliminates all the guesswork inherent in starting a new business. 
A)  It allows her to know all the problems the business already has. 
B)  It gives her the freedom to develop exactly the business she wants. 
C)  It eliminates all the costs Juanita would normally have in starting a business. 
D)  It provides a built-in network of customers, suppliers, and distributors. 
E)  It eliminates all the guesswork inherent in starting a new business.

Question 16

Millennials number around 83 million and represent a huge business opportunity in the United States. What is a defining feature of millennials?

Accepted Answer

A)  This cohort is solely concerned about money. 
B)  This cohort is opposed to working remotely. 
C)  This cohort prefers face-to-face meetings over virtual communication. 
D)  This cohort consists of people born between 1946 and 1964. 
E)  This cohort is concerned with advancement, recognition, and improved capabilities. 
A)  This cohort is solely concerned about money. 
B)  This cohort is opposed to working remotely. 
C)  This cohort prefers face-to-face meetings over virtual communication. 
D)  This cohort consists of people born between 1946 and 1964. 
E)  This cohort is concerned with advancement, recognition, and improved capabilities.

Question 17

Tamika borrows $40,000 from her father for her new business venture. She promises that he will be a partner in the business and be entitled to a significant percent of the business's profits at the end of the year. This is an example of

Accepted Answer

A)  franchising. 
B)  bartering. 
C)  equity financing. 
D)  initial public offering. 
E)  debt financing. 
A)  franchising. 
B)  bartering. 
C)  equity financing. 
D)  initial public offering. 
E)  debt financing.

Question 18

Elaine has a great idea for starting a new business, but she is not sure if she has the knowledge or experience to run a growing business effectively. This relates to which cause of small business failure?

Accepted Answer

A)  high stress levels 
B)  undercapitalization 
C)  inability to cope with growth 
D)  managerial incompetence 
E)  not understanding the competition 
A)  high stress levels 
B)  undercapitalization 
C)  inability to cope with growth 
D)  managerial incompetence 
E)  not understanding the competition

Question 19

Roland wants to start a small editing company. He has enough funds to start the business but not enough to run it effectively. What is one thing he can do to provide working capital to his company?

Accepted Answer

A)  He can use his profits to pay his salary. 
B)  He can borrow funds from outside sources. 
C)  He can refrain from drawing a full salary. 
D)  He can invest his profits into other businesses. 
E)  He can work to find venture capitalists to support his business. 
A)  He can use his profits to pay his salary. 
B)  He can borrow funds from outside sources. 
C)  He can refrain from drawing a full salary. 
D)  He can invest his profits into other businesses. 
E)  He can work to find venture capitalists to support his business.

Question 20

A person who is involved in the process of creating and managing a business to achieve his or her desired objectives is engaged in

Accepted Answer

A)  intrapreneurship. 
B)  capitalization. 
C)  economics. 
D)  philanthropy. 
E)  entrepreneurship. 
A)  intrapreneurship. 
B)  capitalization. 
C)  economics. 
D)  philanthropy. 
E)  entrepreneurship.

All of the following are true of direct selling EXCEPT

What is true of wholesalers?

Small businesses, by their very nature, are small and therefore do not contribute significantly to job creation.

Jayla wants to open her own business making cakes. She has $10,000 of her own money and receives another $20,000 from family and friends. This combined $30,000 that Jayla can use toward her new business is referred to as

What is true regarding the reputation of small businesses?

Rosemary was born in 1952. She is a wealthy North Carolina native. As she ages, Rosemary spends more of her money on travel, financial planning, and health care. Rosemary is a(n)

Kaden and Elizabeth run a small farm stand on their property, selling vegetables, fruits, and plants to support themselves. During a particularly bad growing season, they try to get financing from a small rural bank in their community but they do not get it. What is the most likely reason for this?

What type of business has been growing faster than other classifiable firms and represents almost 30 percent of all small businesses?

Which group represents over 17 percent of those living in the United States and is largely employed in the retail industry?

Marissa is a fitness expert who starts her own personal training company. She conducts fitness classes for women and provides personal training sessions for clients. Marissa can be regarded as a(n)

It has often been said that the greatest impediment to the success of a small business is

Manuel wants to start his own small business. All of the following are things he must to do to start a business EXCEPT

Menami and Michael recently had their first child. As two working parents, they struggled to find good, economical childcare. As a result, they developed their own software to link parents with licensed, reasonably priced childcare providers. This is an example of the

Juanita wants to run her own bowling alley, but she does not want to start it from scratch. She decides to buy an existing business. What is one advantage of doing this?

Millennials number around 83 million and represent a huge business opportunity in the United States. What is a defining feature of millennials?

Tamika borrows $40,000 from her father for her new business venture. She promises that he will be a partner in the business and be entitled to a significant percent of the business's profits at the end of the year. This is an example of

Elaine has a great idea for starting a new business, but she is not sure if she has the knowledge or experience to run a growing business effectively. This relates to which cause of small business failure?

Roland wants to start a small editing company. He has enough funds to start the business but not enough to run it effectively. What is one thing he can do to provide working capital to his company?

A person who is involved in the process of creating and managing a business to achieve his or her desired objectives is engaged in

The Dynamics of Business and Economics

Business Ethics and Social Responsibility

Business in a Borderless World

Options for Organizing Business

The Nature of Management

Organization, Teamwork, and Communication

Managing Operations and Supply Chains

Motivating the Workforce

Managing Human Resources

Customer-Driven Marketing

Dimensions of Marketing Strategy

Digital Marketing and Social Networking

Accounting and Financial Statements

Money and the Financial System

Financial Management and Securities Markets

Personal Financial Planning and Legal and Regulatory Environment

Appendix A: Guidelines for the Development of the Business Plan

Appendix B: Personal Career Plan

Appendix C: Risk: The Basics of Risk Management

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Exam 5: Small Business, Entrepreneurship, and Franchising

All of the following are true of direct selling EXCEPT

What is true of wholesalers?

Small businesses, by their very nature, are small and therefore do not contribute significantly to job creation.

Jayla wants to open her own business making cakes. She has $10,000 of her own money and receives another $20,000 from family and friends. This combined $30,000 that Jayla can use toward her new business is referred to as

What is true regarding the reputation of small businesses?

Rosemary was born in 1952. She is a wealthy North Carolina native. As she ages, Rosemary spends more of her money on travel, financial planning, and health care. Rosemary is a(n)

Kaden and Elizabeth run a small farm stand on their property, selling vegetables, fruits, and plants to support themselves. During a particularly bad growing season, they try to get financing from a small rural bank in their community but they do not get it. What is the most likely reason for this?

What type of business has been growing faster than other classifiable firms and represents almost 30 percent of all small businesses?

Which group represents over 17 percent of those living in the United States and is largely employed in the retail industry?

Marissa is a fitness expert who starts her own personal training company. She conducts fitness classes for women and provides personal training sessions for clients. Marissa can be regarded as a(n)

It has often been said that the greatest impediment to the success of a small business is

Manuel wants to start his own small business. All of the following are things he must to do to start a business EXCEPT

Menami and Michael recently had their first child. As two working parents, they struggled to find good, economical childcare. As a result, they developed their own software to link parents with licensed, reasonably priced childcare providers. This is an example of the

Juanita wants to run her own bowling alley, but she does not want to start it from scratch. She decides to buy an existing business. What is one advantage of doing this?

Millennials number around 83 million and represent a huge business opportunity in the United States. What is a defining feature of millennials?

Tamika borrows $40,000 from her father for her new business venture. She promises that he will be a partner in the business and be entitled to a significant percent of the business's profits at the end of the year. This is an example of

Elaine has a great idea for starting a new business, but she is not sure if she has the knowledge or experience to run a growing business effectively. This relates to which cause of small business failure?

Roland wants to start a small editing company. He has enough funds to start the business but not enough to run it effectively. What is one thing he can do to provide working capital to his company?

A person who is involved in the process of creating and managing a business to achieve his or her desired objectives is engaged in

The Dynamics of Business and Economics

Business Ethics and Social Responsibility

Business in a Borderless World

Options for Organizing Business

The Nature of Management

Organization, Teamwork, and Communication

Managing Operations and Supply Chains

Motivating the Workforce

Managing Human Resources

Customer-Driven Marketing

Dimensions of Marketing Strategy

Digital Marketing and Social Networking

Accounting and Financial Statements

Money and the Financial System

Financial Management and Securities Markets

Personal Financial Planning and Legal and Regulatory Environment

Appendix A: Guidelines for the Development of the Business Plan

Appendix B: Personal Career Plan

Appendix C: Risk: The Basics of Risk Management

Filters