Deck 3: Opportunity Recognition, Shaping, and Reshaping

Question 1

Asking leading questions is the best method of discovering the appeal of a potential product or concept.

Answer 1

False

Question 2

The S-curve is a forecasting tool designed to measure the power of competition.

Answer 2

True

Question 3

A company will make a better growth decision by identifying the most lucrative PTA.

Answer 3

True

Question 4

Starting a company in a sphere of business that you really enjoy is not the best idea, in terms of the chance of success.

Question 5

You will likely fail if you start a business in an area you have no experience in

Question 6

The key to success in comedy improvisation is to always say, "Yes, but…"

Question 7

Playing the role of devil's advocate is important at the "optimize practicality" stage of concept development.

Question 8

According to IDEO, the first step in the creation of a product is to make a set of assumptions.

Question 9

To target goods and services specifically to Hispanic populations in the US is to focus one's market too narrowly.

Question 10

Saying, "That will not work because…" is important at later stages of business development.

Question 11

The first domain name on the Web was assigned in 1986.

Question 12

New, entrepreneurial ideas frequently sprout from an entrepreneur's desire for a product that he or she cannot currently find in the market.

Question 13

The market enters a fast growth phase when customer awareness and demand exceed supply.

Question 14

Cocktail-party entrepreneurs can provide you with invaluable advice about how to run a venture

Question 15

An entrepreneur should try to broaden his or her customer base definition at the early stages of developing an idea.

Question 16

Customer and market trends change too rapidly to be of any predictive use for an entrepreneur.

Question 17

A penetration pricing strategy is one of the most simple and successful initial approaches for a new venture.

Question 18

In aggregate, baby boomers create powerful trends for US businesses.

Question 19

No one knows about your strengths better than you do.

Question 20

Most successful ideas are driven by the entrepreneur's personal experience.

Question 21

Which of the following most typifies a "cocktail entrepreneur?"

A)Fails to take action
B)Popular
C)Productive
D)Decisive
E)Possesses a predilection for cocktails

Question 22

What is the only action that the "gather stimuli" stage requires of the entrepreneur?

A)Ask
B)Think
C)Do nothing
D)Observe
E)Research

Question 23

According to the chapter, into what type of opportunity should a business idea translate?

A)Realistic
B)Easy to implement
C)Attractive
D)Unique
E)Technologically advanced

Question 24

It is important to lower your gross margins early in the venture's life

Question 25

An understanding of your STA helps you to:

A)Train your employees
B)Find better management
C)Develop a penetration strategy
D)Make better growth decisions
E)Build your value chain

Question 26

The cost-plus pricing technique is the most reliable one as it sets the price equal to the product's value.

Question 27

A venture whose vendors are primarily commodity suppliers, will retain a large portion of the value chains gross margin.

Question 28

Which of the following is not a venture stage specifically enumerated in the chapter?

A)Investigation
B)Launch
C)Growth
D)Operations
E)All of the above are stages

Question 29

Which of the following is not a part of IDEO's product design steps?

A)Optimize practicality
B)Multiply stimuli
C)Gather stimuli
D)Create customer concepts
E)Create stimuli

Question 30

Pre-launch analysis will determine the required variables of your business model and should be assumed to be true in the absence of contrary facts.

Question 31

In which stage is it important to play devil's advocate?

A)Optimize practicality
B)Multiply stimuli
C)Gather stimuli
D)Create customer concepts
E)Create stimuli

Question 32

A highly priced product will usually be perceived as better quality by the customer.

Question 33

What is the name of the process that is the equivalent of brainstorming, but with a focus on writing rather than verbal communication?

A)Paper-writing
B)Brain-writing
C)Mute-storming
D)Brain-exploding
E)Paper-storming

Question 34

It typically takes 1-2 years for a firm to reach stability and for operating costs to stabilize.

Question 35

A startup will likely fail if the entrepreneur ignores feedback from his or her customers.

Question 36

An important technique in brainstorming is to say:

A)"Yes and…"
B)"Yes, but…"
C)"That won't work because…"
D)"We need to avoid…"
E)"Nice!"

Question 37

On what category of customers should a startup business focus most of its attention?

A)STA
B)PTA
C)TTA
D)An even share of STA, PTA, and TTA
E)None of the above

Question 38

Stringent government approval processes may not signal a poor opportunity if potential margins are still relatively high.

Question 39

Customers can assist you to determine direct competitors, indirect competitors, and substitutes.

Question 40

What does moving a seed of an idea to a more concrete possibility require?

A)Practical thinking
B)Market research
C)Input from others
D)A business plan
E)Maturity

Question 41

Why is it important to be passionate about your venture?

Question 42

What is the approximate number of baby boomers in the US?

A)55-60 million
B)60-65 million
C)65-70 million
D)70-75 million
E)75-80 million

Question 43

Based on existing research, how long in the life of a startup do operating costs take to stabilize?

A)1-2 years
B)3-5 years
C)4-6 years
D)6-7 years
E)8 years

Question 44

What is the short-sighted thinking behind the penetration-pricing strategy?

A)Pricing below competitors will lead to higher market share
B)Gross margins should be very high for a new product.
C)Loyal customers demand the lowest price.
D)The simplest method of selective prices saves time.
E)Prices should match the value of products.

Question 45

When markets are emerging, which factor matters most long term?

A)Gross margins
B)Number of new entrants annually
C)Determining and securing the dominate customer value proposition
D)Attracting a diverse pool of investors

Question 46

What is an example of a relatively inelastic product?

A)Burgers
B)Train tickets
C)Gasoline
D)DVD discs
E)Notebooks

Question 47

When starting web business, which measure of effectiveness matters most?

A)The number of "eyeballs" looking at your site
B)Profits
C)Click thru rates
D)Overhead expenses
E)Revenue

Question 48

According to the chapter, people of Hispanic descent will comprise 25% of the US population by what year?

A)2020
B)2030
C)2035
D)2040
E)2050

Question 49

To replace $70,000 of forgone salary and benefits, an entrepreneur will need the new venture to generate approximately how much in annual revenue?

A)$70,000
B)$200,000
C)$400,000
D)$600,000
E)$800,000

Question 50

When pre-launch analysis predicts unfavorable outcomes you should:

A)Abandon the venture
B)Go forward strongly in spite of negative forecasts
C)Seek to confirm/deny the variable that underpin outcomes during execution
D)Seek to confirm/deny all variable prior to starting the venture .

Question 51

How does the US Government support entrepreneurship?

A)Registration of a new business is a relatively short process
B)The level of regulations is generally low
C)US taxes are lower than those in most nations
D)All of the above
E)None of the above

Question 52

Research suggests that a gross margin of what percent is a good benchmark for distinguishing more attractive opportunities from less attractive ones?

A)5%
B)15%
C)40%
D)70%
E)None of the above.

Question 53

Generally speaking, what is the lowest level of total revenue in which a market becomes attractive for new entrants?

A)$15 million
B)$20 million
C)$25 million
D)$30 million
E)$35 million

Question 54

Better Opportunities tend to exist when:

A)The core customer group is small
B)There is existing and strong competition
C)The net margins greater than 10%
D)There are mature market structures

Question 55

The weak link in Gourmet Stew's business model was?

A)Value proposition
B)Customer segments
C)Distribution channels
D)Cost structure

Question 56

Which of the following is an example of a perfect business?

A)Intel
B)Wal-Mart
C)Amazon.com
D)McDonalds
E)There is no such thing as a perfect business

Question 57

Which of the following is NOT related to competitive profiling?

A)Net margins
B)Revenues
C)Tax rates
D)Pricing

Question 58

How does one turn a seed of idea into an actual idea?

Question 59

What markets are characterized by "stealth" competition?

A)Growing
B)Primitive
C)Developed
D)Speculative
E)Emerging

Question 60

The graphical depiction that highlights the diffusion of product acceptance over time is:

A)S-Curve
B)C-Curve
C)U-Curve
D)V-Curve
E)J-Curve

Question 61

How can a business separate its target customers into categories of importance?

Question 62

What are the ways of pricing a new product and what mistakes should entrepreneurs avoid?

Question 63

Why can't companies raise prices after using penetration pricing strategy?

Question 64

Why is the statement, "My startup has no competition," always wrong? How can you find out about your competitors?

Question 65

In contrast to the dangers of employing a penetration pricing strategy, describe the dangers of employing a maximal pricing strategy.

Question 66

What other value chains, besides those of direct competitors, should be analyzed?

Question 67

List some vulnerabilities of competitors in larger, mature, consolidate market vis-à-vis a new entrant.

Question 68

Give examples of some of the biggest trends in the recent history that have shaped business in the US.How did they influence business in general?

Question 69

What is the function of the government in the process of enterprise creation?

Question 70

How can one best predict the acceptance of the product by the customer?

Question 71

Give two examples showing vendor power, both strong and weak.

Question 72

Discuss the limitation of first mover advantage in an emerging market where intellectual property protections are not a major factor.

Question 73

What can an entrepreneur do when there are no business opportunities at all?

Question 74

Describe the process IDEO suggests an entrepreneur needs to go through to design a product.

Question 75

What categories of customers exist? How do you prioritize and address them?

Question 76

Give a brief checklist of information that an entrepreneur should investigate.