Deck 6: Managing Small Business Start-Ups

Question 1

Entrepreneurs in the sustainer category alike the chance to balance work and personal life and often don't want the business to grow too large.

Answer 1

True

Question 2

Entrepreneurs are in more control of their environment,generally speaking,and can be expected to have an external locus of control.

Answer 2

False

Question 3

Women and minorities who have found their opportunities limited in the corporate world are seeing intrapreneurship as the only way to go.

Answer 3

False

Question 4

Hong Kong is the most entrepreneurial country,with 47.4 percent of individuals age 18 to 64 starting a new business.

Question 5

The fastest growing segment of small business in both the U.S.and Canada is partnerships.

Question 6

The process of initiating a business venture,gathering and organizing the appropriate resources,and assuming the associated risks and rewards refers to Entrepreneurship.

Question 7

People who have high achievement needs like to set their own goals,which are moderately difficult.

Question 8

Optimizers are rewarded by chance to work on something new and creative.

Question 9

A tolerance for ambiguity is a psychological characteristic that enables a person to accept the threat of competition and potential risk.

Question 10

Small businesses,according to the Small Business Administration,employ more than 90 percent of the private workforce in the United States and are responsible for 85 percent of all business innovations.

Question 11

Entrepreneurship and small business in the United States is an engine for job creation and innovation.

Question 12

Immigrants are more likely to start small businesses than native-born Americans.

Question 13

Entrepreneurs in the sustainer category are rewarded by the personal satisfaction of being business owners.

Question 14

The primary focus of most entrepreneurs is retail,manufacturing and/or service type of businesses.

Question 15

The psychological characteristic that allows a person to be untroubled by disorder and uncertainty is called tolerance for ambiguity.

Question 16

Sole proprietorships are the fastest growing segment of small business in both the U.S.and Canada.

Question 17

Every time Tina Faye does poorly on an exam and blames some outside factor,she can be described as having an external locus of control.

Question 18

Entrepreneurs in the optimizer category are rewarded by the personal satisfaction of being business owners.

Question 19

Sole proprietorships are the fastest growing segment of small business.

Question 20

Small businesses represent 68 percent of all firms and employ about three quarters of all private sector employees.

Question 21

A business incubator is an independent company producing a product or service similar to that produced by the entrepreneur's former employer.

Question 22

Equity financing is when funds are invested in exchange for ownership in the company.

Question 23

A proprietorship is an unincorporated business owned by two or more people.

Question 24

A venture capital firm is a group of companies or individuals that invests money in new or expanding businesses for ownership and potential profits.

Question 25

Since a corporation is a legal structure reserved for large firms,small businesses have two basic choices for legal structure of their company: proprietorship and partnership.

Question 26

Two principle advantages of forming a corporation are continuity and limits on the owners' liability.

Question 27

Forty-one percent of people start a business to fulfill a dream.

Question 28

The main problems are producing the product or service and obtaining customers in the survival stage of growth.

Question 29

An attractive innovation for entrepreneurs who want to start a business from scratch is to join a business incubator.

Question 30

Borrowing from family and friends is a common source of debt financing for a start-up business.

Question 31

Social entrepreneurship combines the creativity,business smarts,passion,and hard work of the traditional entrepreneur with a mission to change the world for the better.

Question 32

The drawbacks of proprietorship include unlimited liability and difficulty in obtaining financing.

Question 33

Social entrepreneurs have a primary goal of improving society rather than maximizing profits.

Question 34

The advantage of buying an existing business is the ability to develop and design the business in the entrepreneur's own way.

Question 35

Entrepreneurs are able to deal easily with delays and exhibit high levels of patience,knowing that the results will be worth the wait.

Question 36

To succeed in the competitive online market,aspiring entrepreneurs need to identify a market niche that isn't being served by other companies.

Question 37

The first stage of growth for an entrepreneurial company is the investment stage.

Question 38

A document specifying the business details prepared by an entrepreneur prior to opening a new business is known as a business plan.

Question 39

Borrowing money that has to be repaid at a later date in order to start a business is equity financing.

Question 40

A business opportunity that provides shared office space,shared secretarial assistance,management support services,and management advice to entrepreneurs is a franchise.

Question 41

Professional Web sites should be easy to navigate and intuitive,and should avoid common mistakes such as typos,excessively large files,too much information,and sensory overload.

Question 42

The owner should start implementing more structured control systems by Stage 3 of growth for an entrepreneurial firm.

Question 43

Setting standards too high is a common pitfall for keeping a small business running successfully.

Question 44

The economic recession of the late 2000s has had minimal effect on small businesses.

Question 45

A business plan should be detailed,encompassing at least 100 pages.

Question 46

The first step in pursuing an entrepreneurial dream is to come up with a viable idea.

Question 47

Minorities show a high rate of entrepreneurship in the United States,owning 5.8 million firms in 2007 that generated $1 trillion in revenues.

Question 48

A domain name gives a company an address on the Web and a unique identity.

Question 49

The most common source of new business ideas comes from in-depth understanding of an industry or profession.

Question 50

At the success stage,the company's substantial financial gains may come at the cost of losing its advantages of small size.

Question 51

The sluggish economic market of the late 2000s has made the franchise real estate market a seller's market.

Question 52

Social entrepreneurs are leaders who are committed to both good business and ensuring high profitability.

Question 53

At Stage 3 of growth for an entrepreneurial firm,managers often are hired to take over duties performed by the owner.

Question 54

The takeoff stage is the last of the five stages of growth for an entrepreneurial company.

Question 55

Owning 40 percent of the private businesses in the United States,women create about 50 percent of the venture-backed technology start-ups.

Question 56

In the start-up stage of an entrepreneurial business,formal planning tends to be nonexistent except for the business plan.

Question 57

Particularly in a turbulent environment,the three most important traits of successful entrepreneurs are realism,flexibility,and passion.

Question 58

The failure rate for high-tech business is lower than the failure rate for conventional businesses.

Question 59

During turbulent times,small business formation is the primary process by which an economy recreates and reinvents itself.

Question 60

The Small Business Administration (SBA)can provide loan financing for small business start-up.

Question 61

The belief by individuals that their future is not within their control,but rather is influenced by some external force is considered

A)an external locus of control.
B)an internal locus of control.
C)a result of a need to achieve.
D)a tolerance for ambiguity.
E)a result of a boost of self-confidence.

Question 62

Which of the following is the belief by individuals that their future is not within their control but rather is influenced by external forces?

A)Awareness of passing time
B)Tolerance for ambiguity
C)Internal locus of control
D)External locus of control
E)Deferred locus of control

Question 63

____ refers to the belief by individuals that their future is within their control and that external forces will have little influence.

A)Awareness of passing time
B)Tolerance for ambiguity
C)Internal locus of control
D)External locus of control
E)Deferred locus of control

Question 64

In the United States,minorities own ____ firms.

A)5.8 million
B)1.3 billion
C)872,000
D)8.9 million
E)2.9 million

Question 65

Which of the following is the type of business that most entrepreneurs start?

A)Retail
B)Manufacturing
C)Service
D)All of these
E)Retail and manufacturing only

Question 66

Which of the following is the process of starting a business venture,organizing the resources,and taking the risks?

A)Intrapreneurship
B)Entrepreneurship
C)Small business administration
D)Venture capital
E)Equity financing

Question 67

A(n)____ is someone who recognizes a viable idea for a business product or service and carries it out.

A)intrapreneur
B)entrepreneur
C)manager
D)leader
E)introvert

Question 68

Being interested in computers,Jose Cohata came up with an idea of personalizing the screen saver programs with family pictures.After trying a couple of programs,Jose started marketing this service to neighbors and area businesses.Jose's activities can be described as a(n)

A)entrepreneurship.
B)intrapreneurship.
C)useless idea.
D)large business.
E)partnership.

Question 69

Lauren Dean strongly believes in her abilities and feels that she controls her own destiny.She can be described as having a(n)

A)tolerance for ambiguity.
B)internal locus of control.
C)external locus of control.
D)low energy level.
E)awareness of passing time.

Question 70

Which of the following demographic factors distinguish entrepreneurs from others?

A)They are likely the youngest child in their family.
B)Most entrepreneurs launch their businesses between the ages of 35 and 55.
C)Their parents likely worked for large companies.
D)They are likely the children of immigrants.
E)All of these.

Question 71

Tracy's Trikes believes that each employee should enjoy the idea of working on something that is new,creative,or personally meaningful.Tracy's Trikes exemplifies which of the categories of small business owners?

A)Optimizers
B)Idealists
C)Hard workers
D)Sustainers
E)Jugglers

Question 72

According to the Small Business Administration,which of these defines a small business?

A)It has fewer than 500 employees.
B)It has sales less than $5 million a year.
C)It has fewer than $100 million in assets.
D)The SBA's definition of small business is one that is independently owned and operated and not dominant in its field of action.
E)It has fewer than 50 employees and $1 million in sales.

Question 73

Which of the following are high-energy people who enjoy handling every detail of their own businesses?

A)Jugglers
B)Idealists
C)Sustainers
D)Optimizers
E)Hard workers

Question 74

Small businesses represent ____ percent of all firms and employ about half of all private sector employees.

A)86.3
B)21.9
C)99.7
D)54.2
E)72.8

Question 75

If a small business owner enjoys the chance to balance work and personal life,he would be considered a(n)

A)idealist.
B)optimizer.
C)hard worker.
D)juggler.
E)sustainer.

Question 76

Small firms that file for patents typically produce ____ more patents per employee than large patenting firms.

A)twice
B)3 to 4 times
C)6 to 7 times
D)9 to 10 times
E)13 to 14 times

Question 77

Which of these characteristics is associated with entrepreneurship?

A)A high need for power
B)A high need for affiliation
C)An internal locus of control
D)An external locus of control
E)Low energy level

Question 78

Today,inspired by the growth of companies such as Amazon.com,entrepreneurs are flocking to the ____ to start new businesses.

A)Small Business Administration
B)Internet
C)bookstore
D)mall
E)Internal Revenue Service

Question 79

An entrepreneur

A)assumes the risks of the business.
B)reaps the rewards of the business.
C)assumes the financial and legal risks of ownership.
D)recognizes a viable idea for a business product or service and carries it out.
E)all of these.

Question 80

At the success stage of growth,a company's substantial financial gains may come at the cost of losing its advantages of small size,including flexibility and the entrepreneurial spirit.