Deck 6: Entrepreneurship and Small Business

Question 1

David Dworkin is the founder and owner of Swoozie's, a chain of stores that carry diverse lines of wrapping paper, stationery, invitations, and gifts for affluent women. He opened the business with his own money and that of investors who saw profit potential in his idea. Dworkin is an example of which of the following?

A) franchisor
B) venture capitalist
C) franchisee
D) entrepreneur

Answer 1

D

Question 2

Some entrepreneurs apply their creativity, vision, and risk taking within a large corporation rather than starting a company of their own. They enjoy a high degree of autonomy while receiving a regular salary and financial backing from their employer. What type of entrepreneur are they?

A) insourced entrepreneurs
B) intrapreneurs
C) multipreneurs
D) corporate entrepreneurs

Answer 2

B

Question 3

Which of the following best describes the activity of an entrepreneur?

A) financing the business
B) locating the business
C) managing the business
D) owning and operating the business

Answer 3

D

Question 4

Gord Larose and his friend David Allan worked at Oracle, a giant company. They dreamed up a scheme for renting software over the Internet. Instead of quitting their jobs, they reported to work on Monday, explained their plan to their boss, and began working to make their idea a reality. Larose and Allan are examples of which of the following type of entrepreneur?

A) growth-oriented entrepreneurs
B) interpreneurs
C) multipreneurs
D) intrapreneurs

Question 5

Michael Bronner made a killing in the direct marketing business as the cofounder and CEO of Bronner Slosberg Humphrey. His newest venture, Upromise Inc., enlists some of America's largest corporations to help families pay for postsecondary education. The 40-year-old Bronner will more than likely start at least one more new company before he retires. What type of entrepreneur is Bonner?

A) a multipreneur
B) an intrapreneur
C) a growth entrepreneur
D) an interpreneur

Question 6

Marc Adler is the owner of Macquarium, a multimillion-dollar communications company that does everything from video productions to creating websites to public relations campaigns. Adler began this company when he could not find anyone in Hollywood who was willing to let him get into the movie making business. Adler is an example of which of the following?

A) venture capitalist
B) entrepreneur
C) franchiser
D) capitalistic adventurer

Question 7

Pim Bouwman quit his lucrative job as a consultant to start a retail website that specializes in marketing Dutch tulip bulbs. He finds it very satisfying and believes that it will provide him with an adequate income. Bouwman is an example of which of type of entrepreneur?

A) classic
B) opportunistic
C) growth-oriented
D) risk-aversive

Question 8

Lachlan Stuart is employed by International Paper, a company that values his vision and creativity. To stay ahead in a very competitive industry, International Paper gives Stuart and his division almost complete autonomy to develop innovative and effective communications. Stuart is an example of which of the following type of entrepreneur?

A) insourced entrepreneur
B) multipreneur
C) intrapreneur
D) corporate entrepreneur

Question 9

What are the three types of entrepreneurs?

A) classic, multipreneur, and intrapreneur
B) traditional, multipreneur, and interpreneur
C) classic, omnipreneur, and micropreneur
D) traditional, dualpreneur, and intrapreneur

Question 10

According to the text, which of the following best describes some of the personality traits of an entrepreneur?

A) creativity and financial skill
B) energy and optimism
C) vision and drive
D) people skills and determination

Question 11

What is the difference between the small business owner and the entrepreneur?

A) The entrepreneur is an innovator.
B) The entrepreneur is a delegator.
C) The entrepreneur is a manager.
D) The entrepreneur is an organizer.

Question 12

What is the difference between the small business owner and the entrepreneur?

A) The entrepreneur is responsible for the profits of the business.
B) The entrepreneur assumes the risk of the business.
C) The entrepreneur files taxes for the business.
D) The entrepreneur manages the business.

Question 13

Many classic entrepreneurs who start small and plan to keep their business small are described as which of the following?

A) intrapreneurs
B) multipreneurs
C) micropreneurs
D) interpreneurs

Question 14

David Dworkin is the founder and owner of Swoozie's, a chain of stores that carry eclectic lines of wrapping paper, stationery, invitations, and gifts for affluent women. He is a classic entrepreneur who envisions having stores across the United States and Canada. Which of the following type of entrepreneurs best describes David?

A) growth-oriented entrepreneur
B) intrapreneur
C) multipreneur
D) interpreneur

Question 15

What is the difference between small business owners and entrepreneurs?

A) Small business owners started the business to pursue their idea for a new product or service.
B) Small business owners are risk takers.
C) Small business owners are innovators.
D) Small business owners accept the status quo and take a short-term view of the future.

Question 16

Which of the following best describes intrapreneurs?

A) They have the characteristics of creativity and vision, but are not risk takers.
B) They receive higher salaries and better employee benefits.
C) They have a low degree of autonomy because they work for a large corporation.
D) They run mini-companies within large corporations.

Question 17

Willa Dakin started a high-tech company that she expects to grow into a major corporation within three years. Which of the following type of entrepreneurs best describes Dakin?

A) blossoming
B) latent
C) growth-oriented
D) potential

Question 18

Which of the following terms would be used to identify the person who takes the risk of starting and managing a business to make a profit?

A) entrepreneur
B) franchiser
C) venture capitalist
D) capitalistic adventurer

Question 19

Which of the following are entrepreneurs who start a series of companies?

A) multiventurists
B) multifaceted venturists
C) multipreneurs
D) intrapreneurs

Question 20

In 1984, Suzanne Pogell wanted to learn to sail, but she could find no one to teach her. She finally convinced someone to teach her to sail, and after mastering sailing, she started an all-woman sailing school called Womanship. Pogell started small and plans to stay small. Which type of entrepreneur is Pogell?

A) a micropreneur
B) an interpreneur
C) an intrapreneur
D) a multipreneur

Question 21

Edie Lopez is opening a catering business because, as an entrepreneur, she will enjoy which of the following?

A) guaranteed profits
B) being her own boss
C) shorter work hours
D) interest-free loans

Question 22

According to Industry Canada small businesses employ what percentage of the workforce?

A) 33
B) 40
C) 48
D) 61

Question 23

Which of the following is a common motive for becoming an entrepreneur?

A) wanting to be rich and powerful
B) to impress friends and family
C) control one's own destiny
D) dissatisfaction with one's current job

Question 24

Which of the following is a disadvantage associated with the ownership of a small business?

A) harder to obtain financing
B) difficult to hire good employees
C) more laws to obey
D) complex tax codes

Question 25

Why does small business thrive in Canada?

A) the owners' ability to avoid outsourcing
B) the owners' regular working hours
C) our rapidly changing technology
D) small businesses have lower costs to comply with regulations

Question 26

What is one advantage of owning a small business?

A) interest-free loans
B) guaranteed profit
C) flexibility
D) no taxes

Question 27

Which of the following is the most common motive for becoming an entrepreneur?

A) challenge of building a business
B) less risk because the entrepreneur is the boss
C) financial dependence
D) dissatisfaction with one's current job

Question 28

According to the text, which of the following is a characteristic of the entrepreneurial personality?

A) social
B) inquisitive
C) passionate
D) detail oriented

Question 29

Michael Bronner made a killing in the direct marketing business as the cofounder and CEO of Bronner Slosberg Humphrey, a wildly successful direct-marketing company. His newest venture, Upromise Inc., enlists some of America's largest corporations to help families pay for postsecondary education and is extremely successful. Bronner would likely be described as which of the following?

A) dependent
B) not committed
C) visionary
D) cautious

Question 30

Dakota Lynn Brown is opening a business in which she will sell educational materials to parents who are home schooling their children. As an entrepreneur, Brown will enjoy which of the following benefits?

A) guaranteed profits
B) shorter work hours
C) personal satisfaction
D) less stress

Question 31

According to the text, which of the following is a characteristic of the entrepreneurial personality?

A) ambivalent
B) inclusive
C) talkative
D) visionary

Question 32

What is one advantage of owning a small business?

A) depending on other locations for assistance
B) the ability to serve specialized markets
C) having more financial resources
D) the avoidance of taxes

Question 33

Which of the following is a disadvantage associated with the ownership of a small business?

A) easier fundraising
B) unlimited management skill
C) fewer government regulations
D) extreme personal commitment

Question 34

Jerome Matthews is opening a small computer repair shop. Like other small-business owners, Matthews probably will experience which of the following?

A) guaranteed profits
B) short work hours
C) burdensome government regulations
D) interest-free loans

Question 35

Small business refers to which of the following?

A) only the bottom 10 percent of all businesses
B) the size and impact of a company in the industry
C) companies with fewer than 30 employees
D) firms with less than $100,000 in sales

Question 36

What is one way for the owner of a small business to keep in touch with all areas of the business?

A) hire assistant managers to report to him
B) work in each area one day a week
C) do all the work himself and hire no employees.
D) have a solid business plan

Question 37

Which of the following is a characteristic of the entrepreneurial personality?

A) ambitious
B) being a follower rather than a leader
C) risk-aversive
D) dependent on others

Question 38

According to Industry Canada, what percentage of all employer businesses are small businesses?

A) 98
B) 92
C) 80
D) 77

Question 39

Over half of small businesses in Canada are found in found industries. Which of the following is NOT one of those four industries?

A) construction
B) manufacturing
C) professional, scientific and technical services
D) wholesale and retail trade

Question 40

Which of the following is a characteristic of small businesses?

A) Small businesses pay very little tax.
B) Small businesses are owned by an individual or small group.
C) Small businesses are very influential in their industries.
D) Small businesses can be based nationally.

Question 41

What is one way to ease the burden of managing a business?

A) operate the business 20 hours a week
B) hire outside consultants
C) do all the work oneself and hire no employees
D) keep minimal inventory on hand

Question 42

How are export management companies characterized?

A) They handle all aspects of exporting, for a percentage fee of the business.
B) They form joint ventures with small exporting businesses.
C) They work on flat fees per month.
D) They do only consulting work.

Question 43

What should a small business owner do on a constant basis that will help identify strengths and weaknesses and explore possible opportunities for expansion?

A) have strategic meetings
B) review the business plan
C) do audits
D) read industry magazines

Question 44

According to the text, what is the best way to keep up with small-business trends?

A) reading magazines
B) going to conferences
C) talking to other small business owners
D) attending networking events

Question 45

Estes Kennedy has decided that he will open a used bookstore as a sole proprietorship. His next step is to write which of the following before he applies for a business loan?

A) a venture prospectus
B) a business plan
C) a business essay
D) a market perspective

Question 46

Which of the following best describes a business plan?

A) a first operating plan for a new business
B) a focus on the product or service
C) a document for the bankers
D) a detailed description of the competition

Question 47

Mark Ghermizian had quit his job and was looking to start a small business so he could be his own boss. When he read that people spend up to 15 minutes every day staring at a bathroom stall door, he decided there was real advertising potential in toilet advertising. Since he has his idea, what is Ghermizian's next step?

A) to create a name for his business
B) to get financing for his new business
C) to choose a form of business organization
D) to determine if he has the right personality to run a business

Question 48

What percentage of business start-ups are brand new organizations?

A) 50
B) 75
C) 85
D) 95

Question 49

Those who provide equity financing to a firm usually get which of the following in return?

A) a fixed rate of return
B) free products
C) shares in the business
D) leverage

Question 50

Which of the following forms of business requires less financing than the others?

A) lifestyle
B) manufacturing
C) growth-oriented
D) high tech

Question 51

Which of the following is a one-to-three page summary of the business plan?

A) executive summary
B) corporate summary
C) shareholders summary
D) directors summary

Question 52

Which of the following is a formal written statement that describes in detail the idea for a new business and how it will be carried out?

A) a business plan
B) a mission statement
C) a vision
D) a statement of purpose

Question 53

Which of the following is the most common use of business plans?

A) to persuade lenders and investors to finance the venture
B) to comply with the Ontario Securities Commission
C) to persuade customers to buy the new product or service
D) to use as a recruitment tool

Question 54

About 80 percent of executives got their ideas for their businesses from working in which of the following?

A) another small business
B) a part-time job
C) a brand new start-up
D) the same or a related industry

Question 55

What is the first step in starting one's own business?

A) to make a business plan
B) to find an idea for a new product or service
C) to determine where the funding will come from
D) to do a self-assessment

Question 56

Once Keeler Monroe had decided he wanted to quit working as a tax preparer and go into some kind of business for himself, he did a self-assessment. What will be his next step?

A) to create a business plan
B) to determine where the funding will come from
C) to find the idea for his business
D) to look for customers

Question 57

Which of the following represent international trade specialists who buy goods at a discount from small businesses and resell them abroad?

A) business trade unions
B) domestic channel members
C) commission house brokers
D) export trading companies

Question 58

Which of the following two forms of business financing describe borrowed funds and ownership funds, respectively?

A) debt; equity
B) credit; leverage
C) equity; debt
D) equity; leverage

Question 59

Marc Adler is the owner of Macquarium, a multimillion-dollar communications company. Macquarium has done work for several large companies. Even though these companies could have prepared their videos and created their websites in-house, these tasks were handled in which of the following ways?

A) They were supplied outside normal channels.
B) They were autonomous productions.
C) They were allocated to a specialized firm.
D) They were outsourced.

Question 60

Once the business plan is finished, what is the next step?

A) to find financing for the business
B) to locate customers
C) to create a promotional campaign
D) to choose a business format

Question 61

Which of the following best describes venture capital?

A) It includes all the money the owner of the business invests in his or her new enterprise.
B) It is financing obtained from investment companies that specialize in financing small, high-growth companies.
C) It is another name for the principal that a business borrows from a bank.
D) It is borrowed money invested in start-up businesses and provided by the Business Development Bank of Canada.

Question 62

Which of the following best describes angel investors?

A) They provide funding for start-up businesses.
B) They are bank loan officers who are responsible for funding start-up businesses.
C) They are most interested in investing in businesses that are well established.
D) They provide equity financing to a business by loaning the business money at a low interest rate.

Question 63

In buying an existing business, the prospective buyer should ask questions about the operation of the business. Which of the following would be the most appropriate question to ask?

A) How are you going to use the money you receive for the business?
B) Are any of the employees creating problems?
C) Who loaned you the initial investment?
D) Are there any problems with the business?

Question 64

Seltzer Darrigan borrowed $25,000 from his bank to open an art gallery. Darrigan used which type of financing?

A) venture
B) liquid
C) debt
D) equity

Question 65

What does the Business Development Bank of Canada do?

A) It provides direct loans for business start-ups.
B) It provides on-site consulting.
C) It helps people start and manage small businesses.
D) It helps immigrants with Canadian business start-ups.

Question 66

When buying an existing business, the prospective buyer should ask questions about the operation of the business. Which of the following would be an inappropriate question to ask?

A) Why are you selling?
B) Are there any problems with the business?
C) Is the business operating at a profit?
D) What are you going to do with the down payment?

Question 67

Pim Bouwman quit his lucrative job as a consultant to start a retail website that specializes in Dutch tulip bulbs. To fund his website, he borrowed money from his friends and relatives. In other words, he used which type of financing?

A) venture
B) liquid
C) debt
D) equity

Question 68

Which of the following is an agency of the federal government that offers both managerial and financial assistance to small businesses?

A) Business Development Bank of Canada
B) Business Incubator Agency
C) Business Welfare Administration
D) Federal Aid Program

Question 69

Jeff Arnold and Reggie Bradford created WebMD, an Internet provider of health care information. Early in the development of this high-growth company, Arnold and Bradford attracted a group of investors who provided them with money needed to acquire other Internet companies with similar missions. What is the investment group called?

A) angel investors
B) entrepreneurial capitalists
C) equity entrepreneurs
D) investment counsellors

Question 70

Which of the following are individual investors or groups of experienced investors who provide funding for start-up businesses?

A) angel investors
B) equity entrepreneurs
C) opportunity entrepreneurs
D) entrepreneurial capitalists

Question 71

According to the text, changes in demographics and society, technology advances, and economic changes offer the best opportunities for which of the following?

A) entrepreneurs
B) not-for-profits
C) educational institutions
D) corporations

Question 72

Somebody who specializes in financing small high-growth companies in return for an ownership interest and a voice in management is referred to as which of the following?

A) angel investor
B) equity entrepreneur
C) venture capitalist
D) financier

Question 73

What does the Business Development Bank of Canada offer?

A) the elimination of sales and employee taxation for the first three years of operation
B) employee recruiting, hiring, and firing
C) bank loans
D) entrepreneurial ideas

Question 74

Which of the following provides the start-up financing for the majority of new small businesses?

A) the local bank
B) venture capitalists
C) the business owner
D) the Business Development Bank of Canada

Question 75

Which of the following is NOT a common cause of most business failures?

A) economic factors
B) financial causes
C) personnel problems
D) owner's lack of experience

Question 76

Jeff Arnold and Reggie Bradford created WebMD, an Internet provider of health care information. Early in the development of this high-growth company, Arnold attracted a group of investors who provided him with which of the following type of financing?

A) debt
B) venture
C) equity
D) liquid

Question 77

Which of the following is the primary source of financing for all small business start-ups?

A) the owner's personal savings
B) supplier and customer credit
C) banks
D) the Business Development Bank of Canada

Question 78

Jim Lightsey sold stock to investors in order to finance his company, which will run an Internet auction for sports memorabilia. Lightsey used which type of financing?

A) equity
B) liquid
C) venture
D) debt

Question 79

Which of the following is at the core of most business failures?

A) too much inventory
B) poor cash flow
C) low interest rate
D) inadequate planning

Question 80

Which of the following is financing obtained from investment companies that specialize in financing small, high-growth companies and receive an ownership interest and a voice in management in return for their money?

A) equity financing
B) entrepreneurial capital
C) venture capital
D) debt financing