Deck 14: Earned Income Strategies

Question 1

In nonprofits provide services and resources that corporations need for their business operations, but they also provide opportunities for companies to achieve a social benefit with resources that are outside their philanthropic or marketing budgets.

A) joint ventures
B) nonprofit enterprises
C) operational relationships
D) social enterprises

Answer 1

C

Question 2

In a , the company pays for the use of its name or logo in connection with the nonprofit's products or events.

A) licensing agreement
B) corporate agreement
C) sponsorship
D) joint venture

Answer 2

C

Question 3

A detailed, comprehensive document that encompasses elements of strategic, marketing, business, and operational plans organization is called a:

A) feasibility analysis.
B) market analysis.
C) business plan.
D) sensitivity analysis.

Answer 3

C

Question 4

ties the nonprofit's income directly to the number or amount of total sales made by the corporate partner and thus represents a true partnership in which the interests of both partners are aligned.

A) Cause marketing
B) Social marketing
C) Nonprofit marketing
D) Marketing analysis

Question 5

This is an arrangement under which the company contributes either a fixed amount for each sale of a product or a specified percentage of its sales of a product to the nonprofit, usually in connection with a short-term promotion.

A) Corporate partnership
B) Cause marketing
C) Joint venture
D) Promotion-based venture

Question 6

This is a contract that permits a for-profit company to use the nonprofit's name or logo on its products in return for a royalty payment to the nonprofit.

A) Copyright agreement
B) Partnership
C) Gift-in-kind
D) Licensing agreement

Question 7

The nonprofit's principal contribution to the partnership is its name, recognition, and reputation, for which the corporation is willing to pay in order to enhance its own visibility, image, and sales. Such relationships are largely an exchange of:

A) ideas.
B) assets.
C) supplies.
D) intangibles.

Question 8

The board of a nonprofit organization is studying data retrieved from a feasibility study to determine if there is a marketplace demand for a new service. The board is looking at which part of the organization's business plan?

A) Market analysis
B) Sensitivity analysis
C) Proforma statements
D) Sponsorship

Question 9

are corporations that are engaged in cause marketing.

A) Joint ventures
B) Commercial co-venturers
C) Partners
D) Promoters

Question 10

A nonprofit organization considering selling a product is evaluating the marketplace for competitors. This is an example of exploring:

A) the ventures relationship to the organization's mission.
B) the availability of the raw materials needed to manufacture the product.
C) the availability of storage facilities.
D) the external environment.

Question 11

Corporate sponsorships offer nonprofits the benefits of added revenue and through the company's promotion of the relationship.

A) increased visibility
B) corporate freebies
C) increased respect
D) an increased workforce

Question 12

Careful business plans will include a(an) that shows how projected results will vary if the assumptions are wrong by some percentage.

A) market analysis
B) sensitivity analysis
C) feasibility analysis
D) assets analysis

Question 13

These are new initiatives undertaken jointly by two entities and may involve a specific activity or the creation of a new entity jointly owned by the two partners.

A) Corporate partnerships
B) Joint ventures
C) Nonprofit enterprise
D) Nonprofit business ventures

Question 14

Critics of earned income do not always acknowledge that of nonprofit business ventures providing human and social services are "directly or closely related to their missions."

A) 20 percent
B) 50 percent
C) 90 percent
D) 100 percent

Question 15

The watershed event for nonprofit-corporate partnerships came in 1983, when supported renovation of the Statue of Liberty by offering to contribute a penny to the campaign each time a consumer used his or her credit card from this company.

A) American Express
B) Discover
C) VISA
D) MasterCard

Question 16

According to Young, a business venture is worth pursuing if:

A) it supports the mission.
B) only a minor of the nonprofits supporters are against the venture.
C) only it offers the potential to break even.
D) only it can build a body of political support.

Question 17

This is income from payment for goods or services that the nonprofit has provided.

A) Expendable income
B) Taxable income
C) Contributed income
D) Earned income

Question 18

Most business plans begin with a(an) that gives a thorough but succinct overview of the major points made in the following sections of the plan.

A) executive summary
B) operational plan
C) detailed financial plan
D) plan for growth or exit

Question 19

Successful partnerships have logic to them, and a nonprofit seeking a corporate sponsor needs to think in terms of the company's:

A) interests and goals.
B) financial portfolio.
C) dress policy and health benefits.
D) popularity among their staff and volunteers.

Question 20

According to Wei-Skillern, if the level of earned income is small it may be considered:

A) nonessential.
B) disposable.
C) terminable.
D) eliminated.

Question 21

Three principal activities in nonprofit business ventures are: services, distribution or retail, and direct marketing.

Question 22

Business ventures may also be referred to as:

A) lobbying activities.
B) social enterprises.
C) advocacy.
D) accountable.

Question 23

Nonprofits begin to identify business opportunities:

A) by surveying their donors.
B) by surveying their volunteers.
C) by surveying their staff.
D) by inventorying their assets.

Question 24

Which type of relationship is not a nonprofit-corporate relationship?

A) Licensing agreements
B) Sponsorships
C) Cause-marketing
D) Lobbying

Question 25

The three sources of a balanced portfolio are earned income, philanthropy, and government sources.

Question 26

Ultimately, who is responsible for making the decision if a nonprofit organization should enter into a business partnership?

A) The organization's chief executive officer
B) The Internal Revenue Service
C) The governor of the state where the nonprofit organization is located
D) The nonprofit organization's board of directors

Question 27

Economist Burton Weisbrod wrote in the Stanford Social Innovation Review that Congress should:

A) discourage nonprofits from undertaking business ventures.
B) decrease tax incentives to be charitable.
C) decrease tax incentives for philanthropy.
D) discourage the for-profit business sector from participating in partnerships with the nonprofit sector.

Question 28

Examples of nonprofit business ventures are the retail stores operated by Goodwill and the Salvation Army.

Question 29

All nonprofit organizations participate in some type of earned income venture.

Question 30

One of the processes in creating a nonprofit business venture is to conduct a feasibility analysis.

Question 31

A business plan is a document that is used for internal purposes only.

Question 32

One of the concerns about earned income strategies is that it places limits on transparency and disclosure due to contractual agreements.

Question 33

Overall, nonprofit organizations earn most of their revenue from earned income.

Question 34

The executive director of the Global Good Fund argues that reliance on earned income makes an organization:

A) more flexible.
B) unattractive to people wanting to work in the corporate sector.
C) close doors to opportunities with a large number of possible business partners.
D) hinder their potential for growth.

Question 35

the term "nonprofit enterprise" may be used interchangeably with the phrase:

A) commercial transformation of the nonprofit sector.
B) federal transformation of the nonprofit sector.
C) state transformation of the nonprofit sector.
D) corporate intervention of the nonprofit sector.

Question 36

Earning income from commercial ventures is easier than earning income from donations.

Question 37

Financial donations to nonprofit organizations are referred to as:

A) advocacy income.
B) banked income.
C) gifted income.
D) collaborative income.

Question 38

Young labels earned income that is not directly related to the nonprofit's mission as:

A) disposable.
B) integral.
C) sustaining.
D) supplemental.

Question 39

A financial corporate gift to a nonprofit organization made solely for the purpose of corporate social responsibility is making what type of a donation?

A) Charity
B) Philanthropic
C) Earned income
D) Gift-in-kind

Question 40

Earned income is income derived from donor contributions.

Question 41

According to Sagawa and Segal, determine the five obstacles to successful partnerships.

Question 42

Examine and explain Standard 19.

Question 43

Identify and explain the risks and rewards of a nonprofit organization partnering in a business venture.

Question 44

Demonstrate the difference(s) between sponsorships and advertising.

Question 45

Earned income strategies can impact the perception and public relations of a nonprofit organization.

Question 46

Explain why nonprofit organizations are becoming more interested in pursuing earned income through partnerships with business and business ventures.

Question 47

Identify and explain three concerns about earned income strategies that a nonprofit should explore.

Question 48

Investigate why some licensing agreements can be controversial.

Question 49

Identify and explain the three fundamental questions that nonprofit organizations need to answer before starting a business venture.

Question 50

Explain the risks and benefits of a joint venture for a nonprofit.

Question 51

Explain the benefits to the nonprofit of a cause-marketing relationship.

Question 52

Identify the three principal activities nonprofit-operated business engages in.