Deck 10: Fostering Entrepreneurship

Question 1

Entrepreneurship is important to a nation's economic development.

Answer 1

True

Question 2

Belinda has found a business opportunity she believes will be successful, but there are already a couple companies in that market. To be successful, Belinda will need to ________.

A) pinpoint a competitive advantage
B) patent her idea
C) pursue a joint venture with them
D) write her mission statement

Answer 2

A

Question 3

Small businesses are the same as entrepreneurial ventures.

Answer 3

False

Question 4

Innovation is a key aspect of entrepreneurship.

Question 5

Rob is a CPA who works out of an office in his home. His business is named "Friendly Accounting Services." Eventually Rob would like to grow his business to include partners and bookkeepers. We would classify Rob as ________.

A) self-employed
B) an entrepreneur
C) an employee
D) a franchisee

Question 6

Entrepreneurships are more likely than large businesses to generate patentable ideas.

Question 7

Entrepreneurship's importance can be shown mostly in three geographic areas in the United States: the Northeast, the South, and the Southwest.

Question 8

The purpose of examining the state of the economy, the regulatory situation, social trends, and the local labor supply is to ________.

A) identify possible customers and employees
B) locate resources for use in the new business
C) determine who are the major players in the market
D) identify opportunities and possible competitive advantages

Question 9

If Camden wants his new business to be a good corporate citizen, he should ________.

A) hire only union labor
B) minimize the risks his business takes
C) consider community goals in his business plan
D) observe all the local ordinances and employment laws

Question 10

Despite their overall importance to the economy, small businesses account for fewer new jobs than large corporations.

Question 11

People who engage in ________ take advantage of opportunities to create new products or services, or change existing ones.

A) social responsibility
B) social engineering
C) venture capitalism
D) entrepreneurship

Question 12

To demonstrate social responsibility, entrepreneurs are encouraged to ________.

A) consider community goals in their business plans
B) use recycled materials in their production processes
C) participate in community organizations such as Kiwanis and Rotary
D) sponsor youth sports teams

Question 13

Entrepreneurship is important to every industry sector in the United States.

Question 14

The main difference between an entrepreneurial venture and a small business is size.

Question 15

Nearly half of all workers in the U.S. are employed by small businesses.

Question 16

Exploring the entrepreneurial context includes scanning the economic, political/legal, social, and work environment.

Question 17

Arthur has an idea. After performing a SWOT, he has identified a market that is not being served so he is planning to start a new business and introduce a new product. Arthur is a(n) ________.

A) strategist
B) dreamer
C) entrepreneur
D) independent business developer

Question 18

Brandon is examining the state of the economy, the regulatory situation, social trends, and the local labor supply. This would indicate Brandon is ________.

A) performing a SWOT analysis
B) exploring the entrepreneurial context
C) self-employed
D) a small business owner

Question 19

________ is a process of changing, experimenting, transforming, and revolutionizing.

A) Developing
B) Research
C) Innovating
D) Inventing

Question 20

Annabel operates a local hardware store that she inherited from her parents. When she took over, she updated the point-of-sale equipment and installed a customer database. Annabel is a(n) ________

A) entrepreneur
B) opportunist
C) venture capitalist
D) small business owner

Question 21

Arthur Fry thought his glue was a failure because it didn't stick permanently, but when applied to small squares of paper, it became the popular Post-It ® note. Arthur Fry took advantage of ________.

A) a process need
B) the unexpected
C) a market structure
D) changes in perception

Question 22

An important difference between entrepreneurs and the rest of us is that entrepreneurs can see opportunities the rest of us miss.

Question 23

Before launching his new venture, Doyle is studying the potential competitors for his new product. He will want to find an answer to which one of the following questions?

A) How do they finance their operations?
B) What competitive advantage do they have?
C) Where are they located?
D) How many employees do they have?

Question 24

After the venture is launched, the entrepreneur continues with the same activities as before the launch.

Question 25

Organizing an entrepreneurial venture involves, among other activities, choosing a legal form of business organization.

Question 26

Explain the differences between an entrepreneurial venture and a small business.

Question 27

In the days before sterile adhesives, bandages were tied onto the patient. Next came adhesive tape with small squares of gauze attached, but making these in the doctors' office was tedious and time consuming. Finally Earle Dickson invented the Band-Aid for his wife, who needed a bandage she could apply to herself for small kitchen burns. Dickson saw ________.

A) the unexpected
B) a new industry
C) new knowledge
D) a process need

Question 28

Which one of the following would most likely be a source for ideas for the would-be entrepreneur?

A) manufacturing exhibitions
B) trade publications
C) personal interests and hobbies
D) pure research

Question 29

Farrah has created a computer-generated mockup of her new product for inclusion in the ________ section of her business plan.

A) supporting documentation
B) executive summary
C) analysis of the context
D) description of the business

Question 30

Among the more important pre-launch activities the entrepreneur must perform is the creation of a business plan.

Question 31

"Put a motor on a bicycle? You must be crazy!" Yet that is exactly what William Harley and Walter Davidson did. These two founders of the best-known American motorcycle company saw opportunity in ________.

A) the incongruous
B) the unexpected
C) demographics
D) changes in perception

Question 32

Which one of the following items is found in the financial data section of the business plan?

A) pricing
B) economic analysis
C) sales tactics
D) pro forma cash flow analysis

Question 33

The marketing plan becomes a part of the ________ section of the business plan.

A) description of the business
B) executive summary
C) analysis of the context
D) supporting documentation

Question 34

Emily is calculating her annual revenues, balance sheets, and breakeven points so she can write the ________ section of her business plan.

A) description of the business
B) executive summary
C) financial data and projections
D) analysis of the context

Question 35

In 1938 Dr. Roy Plunkett discovered that a certain material became very slippery when frozen, and PTFE was invented. Under the brand Teflon, PTFE coatings were applied to a wide variety of items from spacecraft to frying pans. DuPont was able to capitalize on ________.

A) the incongruous
B) the unexpected
C) new knowledge
D) process needs

Question 36

Dharma is examining her financial position, the market for her proposed new product, the types of ownership available to her, and the tax laws for her area to determine whether she should go forward with her new business. Dharma is conducting a ________

A) market analysis
B) technical study
C) practicality study
D) feasibility study

Question 37

Before Henry Ford and Frederick W. Taylor collaborated, automobiles were built by craftsmen, one at a time. After the establishment of the assembly line, Ford was able to produce automobiles faster than his competitors. but with equivalent quality. and sell them for a fraction of the cost. Ford saw opportunity in ________.

A) industry structure
B) the unexpected
C) changing perceptions
D) demographic shifts

Question 38

Decades ago only former military personnel and hoodlums sported tattoos. Today tattoos are considered an art form, giving rise to a plethora of tattoo shops. These body artists have taken advantage of changes in ________.

A) demographics
B) market structure
C) perception
D) processes

Question 39

Recognizing the increase in birth rates since 1946, and disliking the task of changing his grandchildren's diapers, Victor Mills began developing a disposable diaper. Pampers were introduced to consumers in 1961. Mills saw opportunity in ________.

A) changes in demographics
B) changes in perceptions
C) new knowledge
D) the incongruous

Question 40

Compare and contrast self-employment and entrepreneurship.

Question 41

Identify at least three sources or areas where entrepreneurs can find ideas. What should entrepreneurs look for as they explore these idea sources?

Question 42

Geneva needs additional capital to launch her business but does not want to share management responsibility with partners. Neither does she want to pay the high taxes often assessed on businesses. Her best option may be a(n) ________.

A) sole proprietorship
B) limited liability partnership
C) C corporation
D) S corporation

Question 43

Hortense and a few of her family members want to launch a new venture but don't want to place their personal assets at risk. For this privilege they are willing to incur the higher taxes associated with the ________ form of organization.

A) limited liability partnership
B) limited liability company
C) S corporation
D) C corporation

Question 44

Identify and describe the six sections of the business plan, including the type of information that should appear in each section

Question 45

Competitive advantage is a necessary ingredient for an entrepreneurial venture's long-term success and survival.

Question 46

The executive summary of a business plan is constructed to remind the executive of his plan for the new business

Question 47

The financial data section of the business plan should contain projections for the first five years and a breakeven analysis.

Question 48

What kind of questions should entrepreneurs ask before embarking on a new venture?

Question 49

The purpose of a business plan is to secure financing for the start-up.

Question 50

In a business plan, the analysis of the context is most closely related to the environmental scan.

Question 51

In a sole proprietorship, profits are ________.

A) distributed to all partners equally
B) taxed at the prevailing business rate
C) taxed as the owner's personal income
D) distributed to the partners according to their level of participation

Question 52

Ignacio knows he cannot pay what the "big boys" pay, so he decides instead to emphasize the ________ his company offers.

A) health insurance benefits
B) retirement savings plan
C) learning opportunities and recognition
D) performance incentives

Question 53

Hobart is at the point in his new venture that he needs to hire more people. He comes to you for advice on the type of candidate he should seek. You tell him, "________."

A) Find someone who can be groomed to take over the business when you are ready to retire
B) Offer each candidate a stake in the business and hire the one who accepts the offer
C) The important thing is to get people on board whose strengths complement your weaknesses
D) Look for people who are exceptionally capable and fit well with the entrepreneurial culture

Question 54

Discuss three of the seven potential sources of opportunity for entrepreneurial ventures.

Question 55

In a sole proprietorship, the founder keeps all the profits but must share management responsibility with investors.

Question 56

A sole proprietor's personal assets are protected from any liability associated with the business.

Question 57

Fallon wants total control over the decisions related to his business but is concerned that should the business fail, his personal assets are at risk. Fallon has chosen the ________ form of ownership.

A) sole proprietorship
B) C corporation
C) general partnership
D) S corporation

Question 58

The first organizing decision that an entrepreneur must make is the ________.

A) type of organizational culture
B) form of legal ownership
C) organization structure
D) assignment of duties and responsibilities

Question 59

As her business grew and competitors entered the market, Inez knew she had to step up her game. What had worked well when the company was brand new no longer enabled her company to meet its goals. Inez realizes she must become a(n) ________ if her company is to continue to grow and prosper.

A) change agent
B) better manager
C) visionary
D) charismatic leader

Question 60

Gaston knows he cannot be physically present at his new restaurant every hour it is open, so he has decided to share management responsibility and profits equally with two others. Gaston has formed a ________.

A) joint proprietorship
B) limited liability corporation
C) limited liability partnership
D) general partnership

Question 61

Organizations that support innovation tend to be smaller with fewer rules and resources.

Question 62

In a general partnership, all partners assume full responsibility for all debts of the business.

Question 63

"There is absolutely no reason why I, the founder of this enterprise, should be making the choice of floor cleaner. The housekeepers know what works and what doesn't. Let them choose." So said Juan, owner of Miller's Office Cleaning. Juan's comment indicates he believes in ________.

A) employee empowerment
B) self-direction
C) autonomy
D) problem solving

Question 64

Because small businesses cannot usually compete with the salaries offered by large corporations, they tend to focus on psychological rewards for their employees.

Question 65

Identify each of the six legal forms of organizations. Discuss the responsibilities of owners, their liability, and the tax treatment of profits of each form.

Question 66

As a company grows, an informal, loose, and flexible atmosphere may not work well.

Question 67

The profits of an S corporation are taxed as a partnership.

Question 68

Which one of the many personality traits of entrepreneurs appeared on two separate lists?

A) abundance of self-confidence
B) high energy level
C) persistent problem solver
D) moderate risk taker

Question 69

Juanita gathers her employees to solicit their opinions regarding big issues facing the young business. After considering their input, Juanita makes the final decision. Juanita is engaging in ________.

A) employee empowerment
B) democratic management
C) participative management
D) autocratic management

Question 70

Corporations look for candidates who match job requirements; entrepreneurs look for candidates to fill skills gaps.

Question 71

The minimum number of partners in a general partnership is three: two general partners and at least one limited partner.

Question 72

Explain why it is difficult for a young business to recruit and retain employees.

Question 73

One advantage of the C corporation is that the owners have complete protection from liability related to business activity.

Question 74

The limited liability company has advantages for the new venture that neither the C or S corporation do.

Question 75

A C corporation can have no more than 50 owners who agree not to sell their stock.

Question 76

Karl and his top managers set goals for the organization, then each department sets supporting goals with their employees, who then set their personal performance goals. These non-managerial employees are allowed to pursue their goals, within certain guidelines, using their best judgement, knowledge, and skills. These employees are ________.

A) called delegates
B) fully empowered
C) being taken advantage of
D) knowledge workers

Question 77

The ability of small firms to successfully recruit appropriate employees is one of the most important factors influencing organizational success.

Question 78

By the time the new company has grown to the point that the founder can no longer make all the decisions, s/he is typically glad to hand off some of that responsibility.

Question 79

Limited liability partners have the right to inspect the business and make copies of company records.

Question 80

In a limited liability company, profits are taxed as a partnership.