Deck 1: Entrepreneurs: the Driving Force Behind Small Business

Question 1

Researchers who study entrepreneurs have discovered that:

A)successful entrepreneurs start with an idea,resources,and a small management team.
B)there is one key set of traits that mark a successful entrepreneur.
C)entrepreneurs desire responsibility and are willing to take moderate risks.
D)the most successful entrepreneurs are willing to take extreme risks and bet the farm in order to succeed.

Answer 1

C

Question 2

A significant benefit of starting your own company is:

A)more leisure time because there is less of a need to punch a time clock.
B)contributing to society and being recognized for your efforts.
C)to be able to choose who you work with or don't work with.
D)more job security than working for a large corporation.

Answer 2

B

Question 3

Minorities cite which of the following as the primary barrier to their entrepreneurship?

A)skepticism
B)access to capital
C)discrimination
D)social pressure

Answer 3

C

Question 4

Potential drawbacks of small business ownership include:

A)a relatively low guaranteed income.
B)a significantly freer personal schedule but less personal income and assets with which to enjoy the more relaxed schedule.
C)a high likelihood of a lower quality of life while starting and establishing the small business.
D)relatively limited potential for further personal development.

Question 5

Dirk wants to be in control.He's tired of taking orders from others and wants to feel a sense of accountability for the outcome of his work.Dirk displays the entrepreneurial characteristic of:

A)the desire for immediate feedback.
B)a desire for responsibility.
C)confidence in his ability to succeed.
D)a high energy level.

Question 6

Which of the following trends is feeding the growth of entrepreneurial activity?

A)A greater focus on professional advancement combined with the "flattening" of large corporations' management hierarchies
B)The rapid growth of the need for low-technology products
C)A favorable attitude toward entrepreneurs in American society
D)Diminished wage increases in corporations and the desire for a better standard of ling

Question 7

Most of today's immigrant entrepreneurs come into the U.S.with:

A)significant educational and financial resources.
B)few skills,little education,and no financial resources.
C)few resources but lots of dedication and desire.
D)little education but significant financial backing from their families in their home countries.

Question 8

Companies started by women differ from companies started by men in that:

A)men's start-ups tend to be smaller and less well-financed than women's.
B)women's companies tend to be labor-intense businesses and therefore employ more people,even though they have smaller revenues.
C)women's companies start smaller.
D)men tend to start their businesses with their own capital,women with others' capital.

Question 9

Mary and Ted are discussing starting a new business and are asking themselves a series of questions like;"What is the worst that could happen if we fail?" "How likely is that to happen?" They are assessing which potential drawback of small business ownership?

A)The long hours and hard work involved
B)The risk of losing their entire investment
C)The lower quality of life they'll experience
D)The uncertainty of their income

Question 10

The growth of entrepreneurship is being fed by:

A)the return to a manufacturing-based economy.
B)technological advancements.
C)diminished opportunities in overseas markets for larger corporations.
D)the vilifying of large corporations in society.

Question 11

More businesses are started by individuals between ________ than at any other age.

A)under 25
B)25 - 34
C)35 - 44
D)45 - 54

Question 12

Entrepreneurs seem to be characterized by:

A)a desire for money.
B)an inability to organize but strong conceptual skills.
C)a desire to work alone because of weak management skills and a need for control.
D)a high energy level.

Question 13

Surveys show that owners of small businesses believe that:

A)they work harder on their own than if they worked for someone else.
B)they earn less than if they worked for someone else.
C)they are less satisfied than if they worked for someone else.
D)venture capital is relatively easy to raise.

Question 14

The nation is rapidly moving from:

A)industrial to capitalism.
B)capitalism to industrial.
C)industrial to knowledge-based.
D)None of the above

Question 15

The international market:

A)has proven to be a tremendous opportunity for small business.
B)is being dominated by large corporations based in Europe and Japan.
C)is largely closed to small U.S.-based businesses because of the growth of international entrepreneurship.
D)provides greater opportunities for women and minority entrepreneurs than U.S.domestic markets do.

Question 16

Entrepreneurs start businesses for a number of reasons including:

A)an opportunity to make a difference.
B)having to deal with less government regulation than as an executive of a large company.
C)a much lower risk of career failure due to layoff or acquisition than working for a large company.
D)the opportunity to get rich much quicker than if they work for a large company.

Question 17

Juan is able to work well in a constantly changing atmosphere and has little concern for what tomorrow will bring.Juan demonstrates which of the following characteristics of a typical entrepreneur?

A)The willingness to take extreme risks
B)A desire for immediate feedback
C)A tolerance for ambiguity
D)A future orientation

Question 18

Which of the following corporate trends have contributed to the growth of entrepreneurship?

A)The acquisition and merging of mega corporations
B)The idea that "small is beautiful" in large companies,resulting in less hierarchy and layers of management
C)The flood of venture capital being made available to small businesses
D)The downturn in international markets forcing a focus on the domestic market

Question 19

Kyoto has started an interior decoration business.Everything about the business,from its name to the color schemes used in the corporate letterhead,is an expression of her personality.She sees this business as her greatest personal achievement.Kyoto is experiencing the opportunity ________ of small business ownership.

A)to reap unlimited profits
B)to contribute to society
C)to make a difference
D)to reach her full potential

Question 20

Entrepreneurial education:

A)has become extremely popular.
B)universities are not able to meet the demand.
C)more courses are being offered in entrepreneurship.
D)All of the above

Question 21

When building a home-based business,it is important that the entrepreneur:

A)keep friends and neighbors from disturbing him/her while working at home.
B)not discuss it with the family to avoid raising expectations and creating undue pressure.
C)have all business mail sent to the home address.
D)not take the home office deduction to avoid IRS scrutiny of his/her tax return.

Question 22

Tom was a financial consultant who liked to work with his hands,especially in making furniture.He quit his rat race financial job to start a small custom furniture business.After struggling for several years,he closed it and went back to financial services.Tom discovered that there was a big difference between making furniture for himself and running a customer furniture manufacturing business.Tom's business failed because of:

A)uncontrolled growth.
B)poor financial control.
C)his lack of experience.
D)an inability to access start-up capital.

Question 23

When running a home-based business:

A)you generally don't need a separate business line,especially during the day.
B)you still need to dress for work and for client meetings.
C)zoning laws do not apply.
D)you can have up to six employees in your home without informing the local zoning commission.

Question 24

Which of the following is true about home-based businesses?

A)Over 2/3 of all home-based businesses are owned by minority males.
B)Home-based businesses tend to focus on blue-collar,lower skill industries.
C)The growth of technology has significantly slowed the growth of home-based businesses.
D)The average home-based business earns over $60,000 a year.

Question 25

Bill and Sally have been tired of the corporate rat race.They leave their investment banking positions in New York,move to Colorado and start a business raising Mohair sheep.This couple is an example of the entrepreneurial phenomenon of:

A)corporate dropouts.
B)corporate downsizing.
C)corporate raiders.
D)corporate castoffs.

Question 26

Small businesses thrive in every industry,but the majority of them are in the:

A)general construction industry.
B)retail businesses.
C)mining and manufacturing.
D)service industries.

Question 27

Which of the following is true about avoiding business failure?

A)You must understand financial statements.
B)You need to learn how to manage others.
C)You must differentiate your product from the competition.
D)You must do all of these.

Question 28

A knowledge based business economy favors small business because:

A)the cost of managing and transmitting knowledge is very low.
B)small businesses are more successful.
C)information technology is driving cost of managing and transmitting knowledge lower.
D)Both A and C

Question 29

More businesses fail because of ________ than for any other reason.

A)incompetent management
B)theft by employees
C)insufficient capital
D)poor choice of location

Question 30

The key to effective financial management in a start-up is:

A)excellent controls.
B)the use of ABC accounting processes.
C)sufficient start-up capital.
D)an adequate inventory on hand.

Question 31

The location of the business is especially important for what type of start-up businesses?

A)Manufacturing
B)Service
C)Computer-based service
D)Retail

Question 32

Part-time entrepreneurship has an additional advantage over starting up a company full-time in that:

A)it is a much lower risk for the entrepreneur.
B)it doesn't require a business plan.
C)the entrepreneur can change products and markets more easily.
D)the entrepreneur doesn't need to know the industry as well.

Question 33

A major threat that family businesses face is:

A)having kids.
B)divorce.
C)management succession.
D)None of the above

Question 34

One key to success with a business startup is to begin with enough ________:

A)capital
B)sales
C)accounts payable
D)suppliers

Question 35

"Copreneurs" are marked by:

A)a division of labor by expertise.
B)their similarity to the traditional mom and pop operation.
C)a decline in the number of businesses.
D)a greater success at raising venture capital than sole proprietorship-type businesses.

Question 36

Entrepreneurial businesses fall victim to this circumstance because they think it only benefits large companies.Without it,a firm has no sustainable basis for survival.

A)A lack of strategic planning
B)Poor financial controls
C)Uncontrolled growth
D)Lack of inventory control

Question 37

The key ingredient-the crucial element-to avoiding the failure of a new business is:

A)the business plan.
B)knowing the business.
C)technical expertise regarding the product.
D)differentiating the business and product from the competition.

Question 38

U.S.economic structure is moving:

A)away from an agricultural to an industrial economy.
B)away from an industrial to a knowledge-based one.
C)back to an agricultural economy.
D)away from an agricultural to a knowledge-based one.

Question 39

Successful copreneurs are marked by which of the following characteristics?

A)distinct and different business and life goals
B)a clear delineation of who is the superior partner and who is the subordinate partner
C)a blending of responsibilities,roles,and authority
D)mutual respect for each other's talents

Question 40

A key characteristic of a successful entrepreneur is:

A)never having failed.
B)expert technical knowledge of the product.
C)learning to fail intelligently.
D)earning at least a 25% return for investors.

Question 41

Management Incompetence includes all but:

A)the owner lacks the leadership ability necessary to operate it successfully.
B)lack of capacity to make the business work.
C)insufficient capital.
D)inexperience.

Question 42

Drawbacks of owning a small business include all but:

A)unbalanced family life.
B)no guarantee that the business would make profits.
C)too many financial statements.
D)Both A and B

Question 43

Joanne is thinking about running her own business.What risks does she face?

A)Getting stuck in a job she hates
B)Having to deal with more government regulation than if she were a manager in a larger company
C)Having less status in society,as most people do not respect small business owners
D)Losing her entire invested capital

Question 44

Primary cause of business failure is:

A)improper managerial attitude.
B)poor financial controls.
C)incompetent management.
D)location.

Question 45

The average small business owner works ________ hours per week.

A)39.5
B)54
C)40
D)80

Question 46

"Copreneurs" are:

A)personality traits of entrepreneurs.
B)entrepreneurial couples who work together as co-owners of their business.
C)business magazines targeted towards entrepreneurs.
D)None of the above

Question 47

Typically,entrepreneurs are very good conceptually but are not able to organize and manage people and jobs.

Question 48

To avoid business failure,an entrepreneur should:

A)know the business in depth.
B)develop a solid business plan.
C)take entrepreneurship courses.
D)Both A and B

Question 49

Small businesses are those that employ:

A)more than 100 employees.
B)fewer than 20 employees.
C)fewer than 100 employees.
D)Number doesn't matter.

Question 50

Which of the following is not a common characteristic of entrepreneurs?

A)Desire for responsibility
B)Business plan expertise
C)Preference for moderate risk
D)High energy level

Question 51

Launching and running a business can be an extremely rewarding experience,but it also can:

A)be highly fun.
B)bring steady paycheck.
C)be stressful.
D)not be rewarding at all.

Question 52

There has been a significant change in the U.S.economic structure,one that favors small business.

Question 53

The most important change due to Expansion occurs in:

A)organizational structure.
B)inventory and financial control procedures.
C)managerial expertise.
D)personnel assignments.

Question 54

Entrepreneurs are people who grow existing businesses by careful management of existing resources.

Question 55

Money driven and wild risk takers are both:

A)common characteristics of entrepreneurs.
B)entrepreneur's techniques to success.
C)common misconceptions of entrepreneurs.
D)None of the above

Question 56

One hallmark of true entrepreneurs is their ability to adapt to the changing demands of their customers and businesses.

Question 57

Customer service,convenience,speed and quality are all examples of:

A)learning to manage people effectively.
B)generating more revenue.
C)small businesses.
D)setting your business apart from others.

Question 58

Entrepreneurs are noted for their ability to bounce back after a business failure.

Question 59

Forces driving the entrepreneurial trend in our economy include which of the following?

A)Technological advancement
B)Shift to a service economy
C)World Wide Web
D)All of the above

Question 60

Starting a part-time business is a popular gateway to entrepreneurship.

Question 61

In today's economy,entrepreneurs are seen as heroes.

Question 62

Advances in technology available to entrepreneurs permit them to move into manufacturing and compete directly with Fortune 500 companies.

Question 63

Entrepreneurs usually experience greater income stability running their own businesses than they did in their corporate careers.

Question 64

Research has isolated a set of characteristics that can predict who will succeed as an entrepreneur.

Question 65

Despite their popularity,family-owned businesses are actually a small portion of the economy and contribute less than 25% of the GNP to the economy of the United States.

Question 66

Although it is a lower risk way to start,very few entrepreneurs start part-time.Most prefer to cut all ties and "dive" into their business full-time,right from the start.

Question 67

The opportunity to reap unlimited profits is the primary motivator for most entrepreneurs.

Question 68

Studies indicate that the opportunity to make a difference is a significant benefit in the eyes of most entrepreneurs.

Question 69

Most entrepreneurs start their businesses when they are between the ages of 25 and 44.

Question 70

"Corporate dropouts" are middle managers who are laid off from large corporations and decide to start their own businesses rather than return to a corporate job.

Question 71

Many entrepreneurs discover they work fewer hours (less than 45 hours a week)as new business owners than they did as middle managers in large corporations.

Question 72

It is common to experience a lower quality of life during a business start-up than after the business is established.

Question 73

When an entrepreneur develops a relationship with a manager in a large established company in order to draw on the corporate manager's experience,it is called "Copreneurship."

Question 74

Research shows that for "Copreneurship" to work,responsibilities must be divided by gender.

Question 75

Immigrant entrepreneurs tend to arrive in the United States with less education and experience but more drive and access to capital through their "ethnic" connections.

Question 76

Companies started by women tend to be smaller than those started by men.

Question 77

One important characteristic of successful "copreneurs" is their ability to separate their business life from their personal life,so that one doesn't consume the other.

Question 78

Despite their magnitude,family businesses face a major threat - a threat from within: management succession.

Question 79

Family-owned businesses have a significant advantage over other forms of small business,in that they have a very high survival rate when transitioning between generations of leadership.

Question 80

To many entrepreneurs,the opportunity for future earnings is more important than the immediate earning potential of the business.