Deck 2: Recognizing Opportunities and Generating Ideas

Question 1

Economic forces impact the opportunities available to entrepreneurs. Which of the following alternatives reflects a set of economic forces that would be of interest to entrepreneurs?

A) level of disposable income, new uses of old technologies, and new laws and regulations
B) new technologies, consumer spending patterns, and new laws
C) level of disposable income, consumer spending patterns, and level of interest rates
D) social and cultural trends, level of interest rates, and what people think is "in"
E) new changes in political areas, new laws, and level of disposable income

Answer 1

C

Question 2

Which of the following is not an example of a social force?

A) changes in interest rates
B) increased interest in healthy foods
C) retirement of baby boomers
D) increased diversity of the workforce
E) increased interest in green products

Answer 2

A

Question 3

The increasing number of spas opening in the United States is attributed to a jump in the number of people trying to deal more effectively with mental health and wellness issues. The increased emphasis on mental health and wellness in the United States is an important:

A) political trend
B) economic trend
C) legal trend
D) social trend
E) technological advances

Answer 3

D

Question 4

A(n) ________ is a thought, impression, or notion. A(n) ________ is a favorable set of circumstances that creates the need for a new product, service, or business.

A) scheme, notion
B) opportunity, idea
C) idea, design
D) idea, opportunity
E) notion, scheme

Question 5

If a new firm was launched to help other firms comply with The Patriot Act, that opportunity was created by:

A) changes in economic forces
B) demographic changes
C) changes in social forces
D) changes in technological forces
E) political actions and regulatory changes

Question 6

Kathryn Kerrigan, the company profiled in the opening feature for Chapter 2, sells shoes. Kerrigan's original idea for the company stemmed from her recognition that:

A) there were no athletic shoes specifically designed for older women
B) there were no fashionable shoes available for young girls
C) there were no low cost women's shoes available in the Chicago area
D) there were no small shoes available for petite women
E) there were no fashionable shoes available for tall women

Question 7

The aging of the U.S. population has resulted in several new firms that have been founded to help older Americans stay in their homes longer, as an alternative to assisted living or moving into nursing homes. The aging of the U.S. population is an important ________ that is creating opportunities in many areas for entrepreneurial firms.

A) economic force
B) regulatory force
C) legal force
D) technological advances
E) social force

Question 8

GasBuddy and GasPriceWatch.com are companies started to help consumers save money on gas. Which environmental trend is most likely to have provided the impetus for the creation of these companies?

A) regulatory changes
B) political changes
C) social forces
D) technological advances
E) economic forces

Question 9

Hulu.com allows people to watch television shows and movies on the Internet. Hulu.com's business opportunity was made possible by ________ that enhanced the ability of television shows and movies to be uploaded to the Internet and played by anyone with a suitable computer and an Internet connection.

A) social forces
B) technological advances
C) legal changes
D) regulatory changes
E) economic forces

Question 10

The three ways to identify an opportunity include:

A) observing trends, solving a problem, and finding gaps in the marketplace
B) studying industry trade journals, talking to consumers, and solving a problem
C) observing trends, conducting brainstorming sessions, and studying industry trade journals
D) observing trends, talking to consumers, and finding gaps in the marketplace
E) reading books, solving a problem, and findings gaps in the marketplace

Question 11

An opportunity has four essential qualities:

A) attractive, timely, durable, and anchored in a product, service, or business that creates or adds value for its buyer or end user
B) practical, opportune, appropriate, and anchored in a product, service, or business that is efficient and effective
C) realistic, striking, timely, and anchored in a product, service, or business that is timely
D) attention-getting, attractive, timely, and anchored in a product, service, or business that creates or adds value for its buyer or end user
E) attractive, durable, resilient, and opportune

Question 12

According to the textbook, opportunities are:

A) tough to spot
B) easy to spot in the service sector but tough to spot in the manufacturing sector
C) easy to spot in the manufacturing sector but tough to spot in the service sector
D) easy to spot
E) neither easy nor tough to spot

Question 13

Jason Carroll is thinking about starting a chain of fitness centers for people who are 50 years old or older. Which of the following is not an appropriate criteria for Jason to test his idea against?

A) Determine whether the "window of opportunity" is open.
B) Determine whether a fitness center for people who are 50 years or older meets the threshold of being a good idea.
C) Determine the extent to which the notion takes advantage of an environmental trend, solves a problem, or fills a gap in the marketplace.
D) Determine whether opening a fitness center for people 50 years old or older is timely.
E) Determine whether opening a fitness center for people 50 years old or older is a concept that creates value for its buyer or end user.

Question 14

Which of the following is correct regarding opportunities and ideas?

A) An opportunity and an idea are essentially the same thing.
B) An idea almost always meets the criteria of an opportunity.
C) An opportunity is a thought, an impression, or a notion.
D) An idea is a favorable set of circumstances that creates a need for a new product, service, or business.
E) It's important to discern whether a particular idea meets the tests of an opportunity.

Question 15

Kate Williams is starting a fashion boutique in an upscale mall near Kansas City. She wants to open her store during the time period in which a business like hers can realistically enter the new market. Kate is trying to open her business while the ________ is open.

A) safe harbor
B) window of opportunity
C) portal of entry
D) doorway of opportunity
E) safety zone

Question 16

The term "window of opportunity," as discussed in Chapter 2, describes the time period in which a firm can:

A) obtain funding or financing
B) hire new employees
C) obtain patent protection for a new product
D) realistically enter a new market
E) get government approval for a regulated product or service

Question 17

The Savvy Entrepreneurial Firm feature in Chapter 2 focuses on iHearSafe, ZUCA, and J.J. Creations, three entrepreneurial startups. While each firm is different and is successful in its own right, the main point of the feature is to illustrate that:

A) companies are often started by everyday people solving problems in their everyday lives
B) closely monitoring environmental trends is an effective way to identify business opportunities
C) one of the most important points to consider before launching a business is to determine if its window of opportunity is open
D) finding gaps in the marketplace is an effective way of identifying business opportunities
E) both economic and social forces impact the opportunities available to entrepreneurs

Question 18

A(n) ________ is a favorable set of circumstances that creates a need for a new product, service, or business.

A) idea
B) scheme
C) design
D) proposal
E) opportunity

Question 19

GreatCall is a company that was started to produce cell phones for older people. Many cell phones are too complicated and the buttons are too small for older people to effectively use. Which of the following approaches to identifying an opportunity was most likely the impetus for GreatCall?

A) observing trends
B) studying industry reports
C) solving a problem
D) talking to consumers
E) finding gaps in the marketplace

Question 20

Hank Simms is a very capable computer programmer. Recently, he noticed a problem that many programmers have, and thought of a solution to the problem that might represent an opportunity for a new software product. Hank's idea for a new software product is an example of a ________ discovery.

A) serendipitous
B) knowable
C) traditional
D) conventional
E) predictable

Question 21

An individual who identifies a business idea on his or her own is referred to as a:

A) separate entrepreneur
B) functional entrepreneur
C) lone entrepreneur
D) individual entrepreneur
E) solo entrepreneur

Question 22

According to the textbook, in a survey of 65 start-ups, ________ of the founders reported that they got their business ideas through social contacts.

A) 90 percent
B) 50 percent
C) 66 percent
D) 12 percent
E) 33 percent

Question 23

According to research in this area, it is more likely that an entrepreneur will get a new business idea through a ________ relationship than the alternatives.

A) weak-tie
B) moderate-tie
C) vertical-tie
D) lateral-tie
E) strong-tie

Question 24

The process of perceiving the possibility of a profitable new business, product or service idea is referred to as:

A) inspired detection
B) creative recognition
C) idea confirmation
D) opportunity recognition
E) inspired discovery

Question 25

________ are characterized by frequent interactions that form between coworkers, friends, and spouses.

A) Balanced relationships
B) Weak-tie relationships
C) Lateral-tie relationships
D) Moderate-tie relationships
E) Strong-tie relationships

Question 26

________ is the process of generating a novel or useful idea.

A) Innovation
B) Imagining
C) Creativity
D) Visualization
E) Envisioning

Question 27

Most of Karen's ideas come from interacting with coworkers, friends, her spouse, her parents, and other people that share the same beliefs that she does. Karen is getting most of her ideas through ________ relationships.

A) weak-tie relationships
B) social-tie relationships
C) strong-tie relationships
D) multiple-tie relationships
E) vertical-tie relationships

Question 28

Curves International, which was founded in 1992 by Gary Heavin, is a fitness center just for women. At the time Curves was founded, most fitness centers targeted fitness enthusiasts and included a number of amenities, ranging from showers and towel service to swimming pools. Rather than competing head-to-head against these centers, Heavin opened a fitness center targeted towards what he felt was an ignored part of the marketplace: women who wanted to lose weight. The best way to describe how Heavin's business idea was recognized is:

A) brainstorming
B) talking to consumers
C) reading industry reports
D) observing trends
E) finding a gap in the marketplace

Question 29

In the five-stage creative process, the flash of recognition, or what is sometimes referred to as the "eureka" experience, occurs in the:

A) insight stage
B) preparation stage
C) incubation stage
D) elaboration stage
E) evaluation stage

Question 30

The ability to notice things without engaging in deliberate search is referred to as:

A) cognitive alertness
B) cognitive awareness
C) managerial alertness
D) entrepreneurial alertness
E) individual awareness

Question 31

Melanie Meyers, who has launched several successful entrepreneurial firms, seems to have a "sixth sense" that allows her to see opportunities that others miss. Melanie's ability is referred to as:

A) individual awareness
B) cognitive alertness
C) entrepreneurial alertness
D) individual readiness
E) cognitive readiness

Question 32

Which of the following statements is incorrect regarding the personal characteristics of entrepreneurs?

A) Some people think that entrepreneurs have a "sixth sense" that allows them to see opportunities that others miss.
B) The extent and depth of an individual's social network affects opportunity recognition.
C) Several studies show that prior experience in an industry actually blinds an entrepreneur to the recognition of new opportunities in the same industry.
D) Creativity is the process of generating novel or useful ideas.
E) The corridor principle states that once an entrepreneur starts a firm, he or she begins a journey down a path where "corridors" leading to new venture opportunities become apparent.

Question 33

Alex has a number of casual acquaintances that he interacts with infrequently. The relationships that Alex has with these people are referred to as: ________.

A) strong-tie relationships
B) moderate-tie relationships
C) lateral-tie relationships
D) weak-tie relationships
E) multiple-tie relationships

Question 34

Which of the following statements is incorrect in regard to entrepreneurial alertness?

A) The research findings on entrepreneurial alertness are conclusive.
B) Alertness is largely a learned skill.
C) People who have more knowledge of an area tend to be more alert to opportunities in that area than others.
D) The term "entrepreneurial alertness" is often associated with a "sixth sense" that seems to allows some people to see opportunities that others miss.
E) Entrepreneurial alertness is defined as the ability to notice things without engaging in deliberate search.

Question 35

A solo entrepreneur is an individual who identified his or her business idea ________. A network entrepreneur is an individual who identified his or her business idea ________.

A) through social contacts, on their own
B) through a business incubator program, through social contacts
C) on their own, through social contacts
D) through the assistance of a paid consultant, through social contacts
E) with one or more partners, on their own

Question 36

Frank Patterson started a firm in 2008 that creates and manufactures accessories for Harley-Davidson motorcycles. He started with four accessories, and after several months added three new accessories that have been very successful. The fact that Frank recognized the opportunity for the three new accessories only after he started his firm and become immersed in the motorcycle industry is an example of the ________ at work.

A) opportunity tenet
B) opportunity rule
C) chance rule
D) access principle
E) corridor principle

Question 37

Small clothing boutiques and specialty shops often start because there is a need for a particular product but large retailers like Target, JC Penny, and Kohl's can't sell enough of the item to stock it on their shelves. If a clothing boutique started to sell designer clothes or clothing for hard-to-fit people because the clothing wasn't being offered by a larger retailer, the best way to describe how that idea was recognized is:

A) finding a gap in the marketplace
B) brainstorming
C) observing trends
D) solving a problem
E) talking to consumers

Question 38

Marie is a very creative person. Often, when trying to generate a novel or useful idea, she spends several days "mulling over" the idea, which is her way of thinking it through, at both the conscious and unconscious level. The stage of the creative process that Marie is in while she is mulling over an idea is referred to as:

A) preparation
B) insight
C) evaluation
D) elaboration
E) incubation

Question 39

Which of the following represents the correct order of the five stages of the creative process?

A) preparation, incubation, elaboration, insight, evaluation
B) insight, preparation, incubation, elaboration, insight
C) preparation, incubation, insight, evaluation, elaboration
D) incubation, evaluation, insight, preparation, elaboration
E) incubation, preparation, evaluation, elaboration, insight

Question 40

A network entrepreneur is an individual who identifies his or her business idea:

A) on their own
B) through the assistance of a paid consultant
C) through social contacts
D) with one or more partners
E) through a business incubator program

Question 41

Economic factors, social factors, technological advances, and political action and regulatory changes are the most important trends to follow in trying to identify opportunities.

Question 42

Which of the following selections is an example of how to discourage creativity at the individual level?

A) Protect people who make honest mistakes and are willing to learn from them.
B) Speculate, be open, and build on others' ideas.
C) Punish mistakes or failed ideas.
D) Deal with employees as equals to show that status isn't very important.
E) Listen attentively in order to acknowledge and provide early support to ideas.

Question 43

An example of a valuable library resources is IBISWorld, which is a:

A) business publication
B) academic journal
C) Census Bureau publication
D) trade journal
E) database of industry-related information

Question 44

According to the textbook, a focus group is a gathering of 5 to 10 people who are selected because:

A) they are most likely to purchase large amounts of the product or service being discussed
B) they responded to a self-selected opinion pool about the topic being discussed
C) of their relationship to the issue being discussed
D) they responded to a mail survey about the topic being discussed
E) they are spokespersons for the topic being discussed

Question 45

Several studies have shown that prior experience in an industry blinds an entrepreneur to potential business opportunities in the same industry.

Question 46

The term "opportunity recognition" refers to the process of perceiving the possibility of a profitable new business or a new product or service.

Question 47

The term "window of opportunity" is a metaphor describing the time period in which a firm can realistically enter a new market.

Question 48

Many specialty shops and boutiques exist because an entrepreneur recognized a gap in the marketplace and started a firm to fill the gap.

Question 49

To make sure that its customers are satisfied and to probe for new product ideas, Intuit routinely sends employees to the facilities of their customers. This technique for generating new business ideas is called:

A) brainstorming
B) day-in-the-life research
C) focus group
D) survey
E) customer advisory board

Question 50

The three ways to identify an opportunity include observing trends, solving a problem, and finding gaps in the marketplace.

Question 51

________ is (are) used to generate a number of ideas quickly.

A) Insight groups
B) Competitive intelligence gatherings
C) Examination groups
D) Survey groups
E) Brainstorming

Question 52

According to the textbook, the best approach to utilizing a library for entrepreneurship-related research is to:

A) discuss your general area of interest with a reference librarian
B) focus your efforts on studying newspapers and periodicals
C) focus your efforts on browsing through industry-related materials
D) discuss your general area of interest with other library patrons
E) focus your efforts on academic journals

Question 53

A(n) ________ is a physical or digital repository for storing ideas.

A) suggestion bank
B) idea depository
C) suggestion pool
D) idea bank
E) proposition pool

Question 54

An opportunity is a thought, impression, or notion.

Question 55

The number one rule for a brainstorming sessions is:

A) no criticism is allowed
B) no freewheeling is allowed
C) no leapfrogging is allowed
D) no more than 10 people are allowed to participate
E) no wild or unrealistic ideas are allowed

Question 56

Most entrepreneurs believe they are more "alert" than others.

Question 57

An opportunity has four essential qualities: it is (1) rare, (2) attractive, (3) timely, and (4) resilient.

Question 58

Which of the following is an example of how to encourage creativity at the organizational level?

A) Maintain a "stiff" organizational culture with no room for different behaviors.
B) Elevate creativity's importance throughout the organization.
C) Pigeonhole employees; keep them in the same job for years.
D) Make no attempt to hire creative people.
E) Promote a mentality suggesting that the best solutions to all problems have already been found.

Question 59

Which of the following is not one of the rules for a formal brainstorming session?

A) no criticism is allowed
B) the session moves quickly
C) freewheeling is encouraged
D) leapfrogging is encouraged
E) the session is used for decision making

Question 60

An opportunity is a favorable set of circumstances that creates a need for a new product, service, or business.

Question 61

Describe the three separate ways that entrepreneurs identify new business, product, and service opportunities?

Question 62

Creativity and innovation are almost identical concepts.

Question 63

It is more likely that an entrepreneur will get a new business idea through a weak-tie than a strong-tie relationship.

Question 64

Describe the difference between an idea and an opportunity. Why is the distinction important?

Question 65

Strong-tie relationships are characterized by infrequent interaction and ties between casual acquaintances.

Question 66

Brainstorming sessions are designed to move slowly, so ideas can be presented and evaluated.

Question 67

Evaluation is the stage of the creative process during which an idea is subjected to scrutiny and analyzed for its viability.

Question 68

Brainstorming is used to generate a number of ideas quickly.

Question 69

The five stages of the creative process include preparation, incubation, insight, evaluation, and elaboration.

Question 70

Elaboration is the stage of the creative process when the solution to a problem is seen or an idea is born.

Question 71

An idea bank is a physical or digital repository for storing ideas.

Question 72

Describe how brainstorming can help facilitate the generation of ideas, and outline the four rules for conducting a brainstorming session.

Question 73

Describe how library and Internet research can be used to generate new business ideas.

Question 74

Describe the difference between strong-tie and weak-tie relationships. Is it more likely that an entrepreneur will get new ideas through strong-tie or weak-tie relationships?

Question 75

A focus group is a gathering of 5 to 10 people who are selected because of their relationship to the issue being discussed.