Deck 1: Introduction to Entrepreneurship

Question 1

According to the Global Entrepreneurship Monitor (GEM) 2015-2016 survey, about ________ percent of adults in the United States are either starting a business or are running a business that has been in existence for less than 3 1/2 years.

A) 3.8
B) 5.5
C) 7.6
D) 9.0
E) 11.9

Answer 1

E

Question 2

One of the businesses owned by Kirsten Blowers, the entrepreneur profiled in the opening feature of Chapter 1, is Riffraff. Riffraff sells ________.

A) refurbished furniture
B) clothing
C) jewelry
D) books
E) t-shirts

Answer 2

A

Question 3

According to the textbook, the number one reason that people become entrepreneurs is to ________.

A) realize financial rewards
B) gain prestige
C) be their own boss
D) continue a family tradition
E) pursue their own ideas

Answer 3

C

Question 4

Kasey Stevenson is starting a firm in the women's clothing industry primarily to pursue financial rewards. According to the textbook, starting a business to make a lot of money ________.

A) often fails to live up to its hype
B) is equally as satisfying as other reasons for starting a business
C) is the number one reason people start their own business
D) is the number two reason that people start their own business, right behind the lack of better career prospects
E) does not rank among the top three reasons that people start their own business

Question 5

Apple is an established firm that encourages and emphasizes entrepreneurial behavior throughout its various divisions. According to the textbook, Apple practices ________ entrepreneurship.

A) tactical
B) corporate
C) strategic
D) business
E) enterprise

Question 6

Cody Rodgers is the founder of a company named Extreme Sports Apparel. The company makes apparel products for extreme sports enthusiasts such as rock climbers, triathletes, skateboarders, and BMX bikers. Cody wants his company to pursue a high level of corporate entrepreneurship. To achieve that goal, Cody's firm should be ________.

A) innovative, risk averse, and take a "wait and see" posture
B) taking a "wait and see" posture, innovative, and risk taking
C) proactive, not innovative, and risk taking
D) taking a "wait and see" posture, not innovative, and risk averse
E) proactive, innovative, and risk taking

Question 7

According to the results of the GEM 2015-2016 survey, about 1 out of every 8 and a ½ American adults is actively engaged in starting a business or is the owner/manager of a business that is less than 3 ½ years old.

Question 8

Google is a firm that is proactive, innovative and risk-taking. From this description, we can most accurately conclude that Google has a high level of ________.

A) enterprise focus
B) innovative intensity
C) entrepreneurial intensity
D) creative intensity
E) innovative concentration

Question 9

The number one reason that people become entrepreneurs is to pursue financial rewards.

Question 10

Which of the following is an accurate characterization of interest in entrepreneurship?

A) There is minimal interest in entrepreneurship across the world.
B) There is minimal interest in entrepreneurship in North America and Europe, but significant interest in Asia and Australia.
C) There is significant interest in entrepreneurship in North America and Europe, but minimal interest in Asia and Australia.
D) While interest in entrepreneurship was once high, it is waning in popularity across the world.
E) There is tremendous interest in entrepreneurship across the world.

Question 11

According to the opening feature on Kirsten Blowers, Riffraff's early success was adversely affected by the actions of Pinterest.

Question 12

Entrepreneurship is the process by which individuals pursue opportunities within the constraints of the resources they control.

Question 13

According to the textbook, the four characteristics of successful entrepreneurs are ________.

A) passion for the business, on the cutting edge of technological change, very charismatic, and tenacity despite failure
B) young and energetic, passion for the business, product/customer focus, and seeks recognition
C) passion for the business, tenacity despite failure, product/customer focus, and execution intelligence
D) on the cutting edge of technological change, forward thinking, tenacity despite failure, and product/customer focus
E) passion for the business, seeks recognition, young and energetic, and execution intelligence

Question 14

According to the Global Entrepreneurship Monitor (GEM) 2015-2016 study, the majority of people in high-income countries are drawn to entrepreneurship ________.

A) to take advantage of an attractive opportunity
B) due to lack of career prospects
C) as a result of government incentives
D) because an important role model was an entrepreneur
E) to gain prestige

Question 15

What is entrepreneurship? What is the essence of entrepreneurial behavior?

Question 16

The three primary reasons that people become entrepreneurs and start their own firms are to ________.

A) gain prestige, realize financial rewards, and eliminate risk in their lives
B) do what they were "born" to do, be their own boss, and gain prestige
C) take big risks, be their own boss, and do what they were "born" to do
D) be their own boss, pursue their own ideas, and pursue financial rewards
E) take advantage of government subsidies, pursue their own ideas, and realize financial rewards

Question 17

Which of the following statements regarding survival rates of entrepreneurial firms in the United States is correct?

A) As high as 50 percent after four years
B) As high as 60 percent after four years
C) As high as 70 percent after four years
D) As high as 80 percent after four years
E) As high as 90 percent after four years

Question 18

According to reliable statistics, 9 out of 10 businesses fail in their first few years of existence.

Question 19

Describe the three primary reasons that people become entrepreneurs and start their own firms.

Question 20

Established firms with an entrepreneurial emphasis are proactive, innovative, and risk-taking.

Question 21

According to Chapter 1, investors often cite the ________ as their most important criterion in the decision to fund new ventures.

A) financial position of the new venture
B) strength of the industry the new firm is entering
C) strength of the new venture's marketing plan
D) strength of the business idea
E) strength of the entrepreneur

Question 22

Which of the following statements is correct regarding entrepreneurial activity and age ranges?

A) The highest percentage of entrepreneurs falls in the 20 to 34 age range.
B) The highest percentage of entrepreneurs falls in the 45 to 54 age range.
C) The highest percentage of entrepreneurs falls in the 35 to 44 age range.
D) The highest percentage of entrepreneurs falls in the 55 to 64 age range.
E) The highest percentage of entrepreneurs falls in the 60⁺ age range.

Question 23

The Savvy Entrepreneurial Firm feature in Chapter 1 focuses on incubators and accelerators, those that help start-ups. ________ are organizations that offer a small amount of seed funding in exchange for small equity positions in the companies that participate in their programs.

A) Incubators
B) Intrapreneurs
C) Accelerators
D) Capital markets
E) Banks

Question 24

According to the textbook, entrepreneurs are ________.

A) gamblers
B) moderate risk takers
C) aggressive risk takers
D) forceful risk takers
E) minimal risk takers

Question 25

Alex and Patty Webb launched a firm several years ago and have been particularly successful in introducing new products to the marketplace. One thing that Alex and Patty are particularly good at is translating their thoughts, creativity, and imaginations into products that reach the marketplace. The ability to make this happen is most closely related to which of the following characteristics of successful entrepreneurs?

A) A passion for the business
B) Execution intelligence
C) Tenacity despite failure
D) Product/market focus
E) A desire for recognition

Question 26

The passion that entrepreneurs have typically stems from the ability to pursue their own ideas.

Question 27

According to Chapter 1, a sentiment that venture capitalists often express is that ________.

A) the strength of the entrepreneur and the strength of the business idea are of equal importance
B) they would never fund a strong entrepreneur with a weak business idea
C) they would rather fund a strong entrepreneur with a mediocre business idea than fund a strong business idea with a mediocre entrepreneur
D) a new venture's marketing plan is more important than either the strength of the entrepreneur or the strength of the business idea
E) they would rather fund a strong business idea with a mediocre entrepreneur than fund a strong entrepreneur with a mediocre business idea

Question 28

Stacey Wills, who is at heart a craftsperson, recently started a firm to manufacture a new innovative food blender. Stacey's desire is to sell her food blender to as many people as possible because she firmly believes in the merits of her product. Stacey's story best illustrates which of the following characteristics, or attributes, of a successful entrepreneur?

A) Product/customer focus
B) Execution intelligence
C) Tenacity despite failure
D) A desire to please consumers
E) A desire to gain financial rewards

Question 29

The What Went Wrong? feature in Chapter 1 focuses on Prim, a failed startup in the laundry industry. According to the feature, Prim failed largely as a result of ________.

A) lack of product/customer focus
B) poor intellectual property protection
C) the individuals who started the firm were too young and inexperienced
D) poor execution intelligence
E) a lack of passion and resolve

Question 30

Which of the following is NOT one of the five common myths about entrepreneurs?

A) Entrepreneurs are tenacious.
B) Entrepreneurs are moderate risk takers.
C) Entrepreneurs should be young and energetic.
D) Entrepreneurs love the spotlight.
E) Entrepreneurs are born not made.

Question 31

Describe the four main characteristics of successful entrepreneurs.

Question 32

According to the textbook, the passion that motivates people to launch entrepreneurial firms typically stems from the entrepreneur's belief that the business will ________.

A) positively influence people's lives
B) make a lot of money
C) increase his or her prestige
D) lead to a high-level job in the corporate sector
E) provide for a secure retirement

Question 33

Which of the following was NOT identified in the textbook as one of the common traits and characteristics of entrepreneurs?

A) Lengthy attention span
B) Self-starter
C) Tolerant of ambiguity
D) Tenacious
E) Pessimistic disposition

Question 34

Which of the following was NOT identified in the textbook as one of the five primary reasons passion is important for the launch of a successful entrepreneurial organization?

A) The ability to stick to a plan even when faced with evidence that changes are needed
B) A willingness to work hard for an extended period of time
C) The ability to overcome setbacks and "no's"
D) The ability to listen to feedback on the limitations of your organization and yourself
E) Perseverance and persistence when the going gets tough

Question 35

Which of the following statements is incorrect regarding entrepreneurial activity and age range?

A) The highest percent of business owners fall in the 45-54 age range.
B) The lowest percent of business owners fall in the 60⁺ age range.
C) The majority of business founders have no prior work experience.
D) The majority of individuals who start companies are in their forties and fifties.
E) Entrepreneurial activity is fairly evenly spread out over age ranges.

Question 36

The number one characteristic shared by successful entrepreneurs is passion for the business.

Question 37

Which of the following is NOT a personality trait or characteristic common among entrepreneurs?

A) Promoter
B) Visionary
C) Short attention span
D) Alert to opportunities
E) Self-starter

Question 38

The four main characteristics of successful entrepreneurs are: passion for the business, execution intelligence, product/customer focus, and tenacity despite failure.

Question 39

The number one characteristic shared by successful entrepreneurs is ________.

A) a desire to achieve financial rewards
B) a passion for the business
C) a desire to employ other people
D) a desire to fulfill a lifetime dream
E) a desire to bring a revolutionary new product or service to market

Question 40

Suppose you are a Small Business Development Center counselor and you're looking at the personality profiles of five potential entrepreneurs. Based on the profiles, which individual has the most desirable mix of personal characteristics to become a successful entrepreneur?

A) Candidate A: visionary, energetic, moderate risk taker
B) Candidate B: seeks recognition, self-starter, creative
C) Candidate C: visionary, high-risk taker, energetic
D) Candidate D: high-risk taker, achievement-motivated, networker
E) Candidate E: tolerant for ambiguity, seeks recognition, motivated primarily by money

Question 41

There has been ________ in the number of minority entrepreneurs in the United States over the past several years.

A) a moderate increase
B) a substantial decrease
C) no meaningful change
D) a substantial increase
E) a moderate decrease

Question 42

As new products that are better than the existing generation of products are introduced, sales normally increase because the new products provide consumers increased value or worth. This process, which is called ________, stimulates economic activity, which is a good thing for the economy.

A) creative destruction
B) repetitive destruction
C) iterative replacement
D) inventive replacement
E) iterative destruction

Question 43

Montana Sky Trails leads multiday outdoor adventure trips for private groups and corporate clients to various locations across Montana. The company was started by Justin Smith, an individual that gave up a prestigious job in banking because Montana Sky Trails better accommodates his personal lifestyle. Montana Sky Trails is an example of a(n) ________ firm.

A) entrepreneurial
B) salary-substitute
C) standard-of-living
D) statutory
E) lifestyle

Question 44

Which of the following was NOT given in the textbook as a reason for the increase in the number of senior entrepreneurs?

A) Seniors tend to be more passionate about new business ideas than middle-aged or younger prospective entrepreneurs.
B) Many seniors have extensive business experience and other qualities that equip them for an entrepreneurial career.
C) Growing worries among seniors that they need to earn additional income to pay for future health care services and other expenses
D) An increasing desire among older workers for more personal fulfillment in their lives.
E) Corporate downsizing

Question 45

Entrepreneurs are motivated primarily by money.

Question 46

In terms of the "types" of startup firms, entrepreneurial firms bring new products and services to market.

Question 47

Identify the three types of startup firms, and discuss how they differ. Provide examples of each type of firm.

Question 48

Unfortunately, statistics show that there is very little interest in entrepreneurship among young people in the United States.

Question 49

Although interest in entrepreneurship remains high nationwide, the number of women-owned businesses is decreasing.

Question 50

Entrepreneurial firms ________.

A) are small firms that yield a level of income for their owner(s) that is similar to what they would earn when working for an employer
B) bring to market new products and services that are not particularly innovative
C) offer to customers common products that are not particularly innovative, and provide their owner(s) the opportunity to pursue a particular lifestyle and earn a living while doing so
D) provide their owner(s) the opportunity to pursue a particular lifestyle and earn a living while doing so
E) bring new products and services to market by creating and seizing opportunities

Question 51

Pacific Fishing LLC is a startup that is working on a new technology for the fishing industry. Because the technology it's working on is highly proprietary, the company is located in the warehouse district of a large western city. Pacific's founder, Ray Sims, rarely gives interviews and is careful to not divulge much about what the company is doing. Which of the following common myths about entrepreneurs does the behavior of its founder, Ray Sims, dispel?

A) Entrepreneurs are born, not made.
B) Entrepreneurs are gamblers.
C) Entrepreneurs are motivated primarily by money.
D) Entrepreneurs should be young and energetic.
E) Entrepreneurs love the spotlight.

Question 52

According to the textbook, there are three types of startup firms: ________.

A) lifestyle firms, general firms, and entrepreneurial firms
B) standard-of-living firms, statutory firms, and general firms
C) entrepreneurial firms, standard-of-living firms, and statutory firms
D) lifestyle firms, salary-substitute firms, and entrepreneurial firms
E) innovative firms, entrepreneurial firms, and standard firms

Question 53

Which of the following statements is NOT true about women-owned businesses in the United States?

A) The number of women-owned businesses is decreasing.
B) A total of 44 percent of women-owned businesses are owned by minorities.
C) In some industries, women own a significant share of the business.
D) The number of groups that support and advocate for women-owned businesses continues to increase.
E) Over the past nine years, the number of women-owned businesses has grown at a rate five times faster than the national average.

Question 54

Colorado Sandwich, Soup and Salad is a casual dining restaurant that has been owned by Stephanie Peterson for the past 14 years. The restaurant offers a menu that is typical for casual dining restaurants and affords Stephanie a level of income that is similar to what she would earn in a conventional job. According to the textbook, Colorado Sandwich, Soup and Salad is an example of a(n) ________ firm.

A) salary-substitute
B) entrepreneurial
C) quality-of-life
D) lifestyle
E) industry-standard

Question 55

According to the textbook, Dropbox, Facebook, and Uber are examples of ________ firms.

A) lifestyle
B) salary-substitute
C) industry-standard
D) entrepreneurial
E) standard-of-living

Question 56

Over the past 10 years, the demographic makeup of entrepreneurial firms has remained fairly stable in the United States and around the world.

Question 57

The Partnering for Success feature in Chapter 1 focuses on campus ambassador or campus rep programs. According to the feature, which of the following is NOT a characteristic that such programs typically look for in student hires?

A) Have upbeat personalities
B) Are effective communicators
C) Have a wide network of friends
D) Have effective marketing skills
E) Have in-depth knowledge and love for the product

Question 58

Entrepreneurs are usually moderate, rather than high, risk-takers.

Question 59

According to a Bentley University survey, ________ percent of millennials have a desire to start their own business.

A) 11
B) 29
C) 36
D) 66
E) 74

Question 60

According to the consensus of the research, some people are genetically predisposed to be entrepreneurs.

Question 61

Which of the following is the correct sequence for the four steps in the entrepreneurial process?

A) Deciding to become an entrepreneur, developing successful business ideas, moving from an idea to an entrepreneurial firm, managing the growing entrepreneurial firm
B) Developing successful business ideas, deciding to become an entrepreneur, moving from an idea to an entrepreneurial firm, managing and growing the entrepreneurial firm
C) Developing successful business ideas, moving from an idea to an entrepreneurial firm, deciding to become an entrepreneur, managing and growing the entrepreneurial firm
D) Deciding to become an entrepreneur, moving from an idea to an entrepreneurial firm, developing successful business ideas, managing and growing the entrepreneurial firm
E) Managing and growing the entrepreneurial firm, developing successful business ideas, deciding to become an entrepreneur, moving from an idea to an entrepreneurial firm

Question 62

The entrepreneurial process consists of four steps: deciding to become an entrepreneur, developing successful business ideas, moving from an idea to an entrepreneurial firm, and divesting or selling the entrepreneurial firm.

Question 63

In regard to patent activity (issuance), which of the following statements is correct?

A) Small businesses outperform their larger counterparts.
B) Small businesses underperform their larger counterparts.
C) Small businesses and large businesses are relatively equal.
D) Small businesses are not active in patent activity.
E) Large businesses are not active in patent activity.

Question 64

A firm's ________ is a plan for how it competes, uses its resources, structures its relationships, interfaces with customers, and creates value to sustain itself on the basis of the value it creates.

A) business plan
B) business model
C) tactical model
D) strategic plan
E) operations model

Question 65

In the book The Theory of Economic Development, ________ argued that entrepreneurs develop new products and technologies that, over time, make current products and technologies obsolete. This process is called creative destruction.

A) Malcolm Gladwell
B) Seth Godin
C) Joseph Schumpeter
D) Thomas Friedman
E) Jim Collins

Question 66

Small businesses outperform their larger counterparts in terms of patent activity (issuance).

Question 67

An event that prompts an individual to become an entrepreneur, such as losing a job, inheriting money, or accommodating a certain lifestyle, is referred to as a(n) ________.

A) prompting event
B) entrepreneurial prompt
C) initiating event
D) triggering event
E) kick-off event

Question 68

________ is the process of creating something new, which is central to the entrepreneurial process.

A) Creative destruction
B) Modernism
C) Execution
D) Creativity
E) Innovation

Question 69

Innovation is the process of creating something new, which is central to the entrepreneurial process.

Question 70

According to the textbook, entrepreneurship has historically had ________.

A) a major impact on the economy and minor impact on society
B) a minor impact on both the economy and society
C) a major impact on society and minor impact on the economy
D) a major impact on both the economy and society
E) no impact on either the economy or society

Question 71

Which of the following is NOT one of the four steps of the entrepreneurial process?

A) Deciding to become an entrepreneur
B) Determining how to seize the spotlight
C) Developing successful business ideas
D) Moving from an idea to an entrepreneurial firm
E) Managing and growing the entrepreneurial firm

Question 72

A(n) ________ is a written document that describes all the aspects of a business venture in a concise manner.

A) business plan
B) business model
C) operations plan
D) corporate plan
E) contingency plan

Question 73

Jan Berry recently received a $500,000 inheritance from her maternal grandmother. Jan decided to use the money to start a business. According to the textbook, the inheritance that Jan received was the ________ that prompted her to start a business.

A) prompting event
B) entrepreneurial prompt
C) initiating event
D) triggering event
E) kick-off event

Question 74

Joseph Schumpeter argued that entrepreneurs develop new products and technologies that over time make current products and technologies obsolete, and this process, which he called creative destruction, is good because it stimulates economic activity.

Question 75

Identify and discuss the three primary reasons that entrepreneurial behavior has a strong impact on the United States economy.