Question 1

A carefully constructed guide for the person starting a business is a(n)

Accepted Answer

A)  business plan. 
B)  marketing plan. 
C)  organizational plan. 
D)  articles of business. 
E)  business budget. 
A)  business plan. 
B)  marketing plan. 
C)  organizational plan. 
D)  articles of business. 
E)  business budget. A

Question 2

Privately owned firms providing venture capital would be identified as

Accepted Answer

A)  the Small Business Administration. 
B)  small-business development centers. 
C)  small-business investment companies. 
D)  small-business institutes. 
E)  the Active Corps of Executives. 
A)  the Small Business Administration. 
B)  small-business development centers. 
C)  small-business investment companies. 
D)  small-business institutes. 
E)  the Active Corps of Executives. C

Question 3

International trade will become more important to small-business owners in the new century.

Accepted Answer

A) True 
 B)False  True

Question 4

The incidence of innovation among small-business workers is significantly higher than that among workers in large businesses.

Accepted Answer

A) True 
 B)False

Question 5

You stop at a SUBWAY to get a sandwich for lunch and you notice that they now have TCBY yogurt. This is an example of a

Accepted Answer

A)  co-branded establishment. 
B)  franchise. 
C)  small business. 
D)  dual-sponsored business. 
E)  dual-branded franchise. 
A)  co-branded establishment. 
B)  franchise. 
C)  small business. 
D)  dual-sponsored business. 
E)  dual-branded franchise.

Question 6

The SBA is a private organization rather than a government agency.

Accepted Answer

A) True 
 B)False

Question 7

In the early days of franchise agreements, franchising was used primarily for automobile dealerships and

Accepted Answer

A)  auto-parts stores. 
B)  dry cleaners. 
C)  fast-food outlets. 
D)  larger restaurants. 
E)  service stations. 
A)  auto-parts stores. 
B)  dry cleaners. 
C)  fast-food outlets. 
D)  larger restaurants. 
E)  service stations.

Question 8

Victor owns his own motorcycle and ATV store. He notices that many of his customers talk about golf while in his store. He quickly adds golf carts and golf clubs to his merchandise selection. Rapidly adjusting to the needs of his customers is possible because small businesses

Accepted Answer

A)  have personal relationships with their customers. 
B)  have the ability to quickly adapt to change. 
C)  are independent. 
D)  have simplified record keeping. 
E)  run the risk of failure. 
A)  have personal relationships with their customers. 
B)  have the ability to quickly adapt to change. 
C)  are independent. 
D)  have simplified record keeping. 
E)  run the risk of failure.

Question 9

How does the SBA define a small business?

Accepted Answer

The Small Business Administration (SBA)

Question 10

There are three general types of franchising arrangements. In one approach, the franchisor authorizes retailers to sell a particular brand-name item. This type of arrangement is common in all of the following areas except

Accepted Answer

A)  the soft-drink industry. 
B)  truck and car sales. 
C)  shoe sales. 
D)  the gasoline industry. 
E)  paint sales. 
A)  the soft-drink industry. 
B)  truck and car sales. 
C)  shoe sales. 
D)  the gasoline industry. 
E)  paint sales.

Question 11

Which statement best describes the general success rate for franchises?

Accepted Answer

A)  Franchises, like other small businesses, have a very high rate of failure. 
B)  Franchises are slightly more successful overall than other types of businesses. 
C)  Franchises have about a 50 percent chance of being successful. 
D)  Franchises have a very high success rate compared to other small businesses. 
E)  Obtaining a franchise is a guarantee for a successful business. 
A)  Franchises, like other small businesses, have a very high rate of failure. 
B)  Franchises are slightly more successful overall than other types of businesses. 
C)  Franchises have about a 50 percent chance of being successful. 
D)  Franchises have a very high success rate compared to other small businesses. 
E)  Obtaining a franchise is a guarantee for a successful business.

Question 12

The purchaser of a franchise is called the franchisor.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is the most likely example of a production industry?

Accepted Answer

A)  Wholesale outlet 
B)  Retail outlet 
C)  Financial enterprise 
D)  Subassembly plant 
E)  Transportation company 
A)  Wholesale outlet 
B)  Retail outlet 
C)  Financial enterprise 
D)  Subassembly plant 
E)  Transportation company

Question 14

To qualify as a small business, a manufacturing plant can employ no more than ____ people.

Accepted Answer

A)  500 
B)  1,000 
C)  2,000 
D)  3,000 
E)  3,500 
A)  500 
B)  1,000 
C)  2,000 
D)  3,000 
E)  3,500

Question 15

A group of senior and graduate students in business administration providing management counseling to small businesses is known as a

Accepted Answer

A)  small-business administration. 
B)  small-business development center. 
C)  small-business institute. 
D)  special task force. 
E)  none of the above. 
A)  small-business administration. 
B)  small-business development center. 
C)  small-business institute. 
D)  special task force. 
E)  none of the above.

Question 16

Money invested in small firms with the potential to become very successful is known as venture capital.

Accepted Answer

A) True 
 B)False

Question 17

What is the Service Corps of Retired Executives (SCORE)? How does it assist small-business owners?

Accepted Answer

The Service Corps of Retired Executives

Question 18

Franchising experienced tremendous growth during the early 1430s.

Accepted Answer

A) True 
 B)False

Question 19

Jamie applies for a small-business loan from the SBA. If he is approved for the loan, where will the money actually come from?

Accepted Answer

A)  The government 
B)  Private lenders 
C)  Venture capitalists 
D)  The Small Business Administration 
E)  Other small businesses 
A)  The government 
B)  Private lenders 
C)  Venture capitalists 
D)  The Small Business Administration 
E)  Other small businesses

Question 20

Of the small businesses in the distribution industry, nearly three-quarters of them are involved in

Accepted Answer

A)  wholesaling. 
B)  purchasing. 
C)  service. 
D)  retailing. 
E)  communications. 
A)  wholesaling. 
B)  purchasing. 
C)  service. 
D)  retailing. 
E)  communications.

Exam 5: Small Business, Entrepreneurship, and Franchises

A carefully constructed guide for the person starting a business is a(n)

Privately owned firms providing venture capital would be identified as

International trade will become more important to small-business owners in the new century.

The incidence of innovation among small-business workers is significantly higher than that among workers in large businesses.

You stop at a SUBWAY to get a sandwich for lunch and you notice that they now have TCBY yogurt. This is an example of a

The SBA is a private organization rather than a government agency.

In the early days of franchise agreements, franchising was used primarily for automobile dealerships and

Victor owns his own motorcycle and ATV store. He notices that many of his customers talk about golf while in his store. He quickly adds golf carts and golf clubs to his merchandise selection. Rapidly adjusting to the needs of his customers is possible because small businesses

How does the SBA define a small business?

There are three general types of franchising arrangements. In one approach, the franchisor authorizes retailers to sell a particular brand-name item. This type of arrangement is common in all of the following areas except

Which statement best describes the general success rate for franchises?

The purchaser of a franchise is called the franchisor.

Which of the following is the most likely example of a production industry?

To qualify as a small business, a manufacturing plant can employ no more than ____ people.

A group of senior and graduate students in business administration providing management counseling to small businesses is known as a

Money invested in small firms with the potential to become very successful is known as venture capital.

What is the Service Corps of Retired Executives (SCORE)? How does it assist small-business owners?

Franchising experienced tremendous growth during the early 1430s.

Jamie applies for a small-business loan from the SBA. If he is approved for the loan, where will the money actually come from?

Of the small businesses in the distribution industry, nearly three-quarters of them are involved in

Exploring the World of Business and Economics

A: Being Ethical and Socially Responsible

B: Being Ethical and Socially Responsible

A: Exploring Global Business

B: Exploring Global Business

Choosing a Form of Business Ownership

Understanding the Management Process

Creating a Flexible Organization

Producing Quality Goods and Services

Attracting and Retaining the Best Employees

Motivating and Satisfying Employees and Teams

Enhancing Union-Management Relations

Building Customer Relationships Through Effective Marketing

A: Creating and Pricing Products That Satisfy Customers

B: Creating and Pricing Products That Satisfy Customers

Wholesaling, Retailing, and Physical Distribution

Developing Integrated Marketing Communications

Social Media, E-Business, and Accounting

Using Management and Accounting Information

Understanding Money, Banking, and Credit

Mastering Financial Management

A: Understanding Personal Finances and Investments

B: Understanding Personal Finances and Investments

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