Question 1

When entrepreneurs identify how they will market,produce,and position their new products,they are involved in which of the following entrepreneurial processes?
A)opportunity placement
B)opportunity planning
C)opportunity management
D)opportunity exploitation
E)opportunity analysis

Accepted Answer

Opportunity exploitation involves the actions taken to market, produce, and position new products, turning identified opportunities into viable business ventures.

Question 2

________ are wealthy individuals who provide capital to new companies.
A)Angel investors
B)Venture capitalists
C)Bank financiers
D)Crowd funders
E)Private equity investors

Accepted Answer

Angel investors are wealthy individuals who provide capital to new companies, often in exchange for ownership equity or convertible debt.

Question 3

Which of the following is true about factors that adversely influence the accuracy of an entrepreneur's risk perceptions?
A)An entrepreneur's belief in the law of small numbers increases the risk he or she perceives with an opportunity.
B)Because individuals are more likely to obtain good information and less likely to obtain bad information,small samples of information are likely biased negatively.
C)Most entrepreneurs have access to large databases.
D)The control that an entrepreneur feels with respect to the opportunity's outcome may influence perceptions of the idea's risk.
E)Law of small numbers and the illusion of control positively influence the accuracy of risk perceptions when evaluating opportunities.

Accepted Answer

The control that an entrepreneur feels can lead to an illusion of control, which may cause them to underestimate the risks associated with an opportunity.

Question 4

Bob's perception that he has been successful with his past entrepreneurial opportunities and therefore his luck will continue with his latest venture is known as ________.
A)upside gain
B)feasibility gain
C)illusion of control
D)feasibility control
E)gain control

Accepted Answer

Bob's belief that his past success will continue into his latest venture, despite not having direct control over the outcome, is an example of the "illusion of control." This cognitive bias leads individuals to overestimate their ability to control events.

Question 5

Exploitation exists when entrepreneurs overestimate the extent to which they can control the outcome of an opportunity.

Accepted Answer

Exploitation refers to the act of taking advantage of something or someone, typically for personal gain, rather than the misestimation of control over outcomes. Overestimating control over outcomes is more related to overconfidence or optimism bias.

Question 6

Which of the following is true about bank financing?
A)Like angel investors and venture capitalists,banks invest in a business.
B)Banks are more interested in ensuring that the entrepreneur's opportunity will survive long enough to ensure repayment.
C)Banks typically focus on investing in a small number of industries.
D)Banks are concerned with the long-term potential for returns.
E)Banks typically provide more capital as the new venture becomes more established.

Accepted Answer

Banks prioritize the ability of a business to repay the loan, focusing on the short to medium-term financial health of the company rather than long-term potential or specific industry focus. Unlike angel investors or venture capitalists, banks do not invest in businesses but provide loans that need to be repaid with interest.

Question 7

________ refers to the activities and investments committed to gain returns from the new product or service arising from the opportunity.
A)Exploitation
B)Information asymmetry
C)Entrepreneurial risk
D)Illusion of control
E)Social value

Accepted Answer

Exploitation involves activities and investments aimed at gaining returns from a new product or service, leveraging the identified opportunity.

Question 8

Describe opportunity exploitation.

Accepted Answer

The answer of Describe opportunity exploitation....

Question 9

Even if an entrepreneur's idea is feasible,opportunities are associated with risk.In this context,________ refers to the resources reduced if an opportunity does not succeed.
A)illusion of control
B)law of small numbers
C)downside loss
D)exploitation
E)feasibility analysis

Accepted Answer

Downside loss refers to the potential resources or assets that could be diminished or lost if an opportunity does not turn out to be successful. This concept is directly related to the risks associated with pursuing new business opportunities.

Question 10

When an entrepreneur obtains financing from a financial institution in the form of a loan,it is termed as ________.
A)angel investing
B)capital investments
C)bank financing
D)loan sharking
E)corporate funding

Accepted Answer

When an entrepreneur obtains financing from a financial institution in the form of a loan, it is termed as bank financing. This is a common method for businesses to secure capital.

Question 11

What is entrepreneurial risk? In this context,explain downside loss.

Accepted Answer

The answer of What is entrepreneurial risk? In this context,explain...

Question 12

Jerry starts his own business even when he is advised by family and friends that it is not a suitable opportunity.His friends feel that the market is uncertain and a new entry at this juncture is inadvisable.Jerry soon realizes that his friends were right and he should have taken their advice.In spite of himself,he is forced to admit that the market situation is such that it would take more than being a good entrepreneur to survive.Which of the following is Jerry experiencing?
A)exploitation
B)anchoring
C)information bias
D)illusion of control
E)reactance

Accepted Answer

Jerry is experiencing the illusion of control, which is the tendency to overestimate one's ability to control events, in this case, believing he could succeed in a difficult market despite advice to the contrary.

Question 13

Which of the following is true about the differences between angel investors and venture capitalists?
A)Venture capitalists are wealthy individuals who provide capital to new companies.
B)Angel investors raise money and then use this money to make investments in new firms.
C)Venture capitalists make more investments than angel investors.
D)Angel investors tend not to focus on particular industries.
E)Venture capitalists typically provide the initial financing to start-up ventures.

Accepted Answer

Angel investors tend not to focus on particular industries.

Question 14

Which of the following best describes an angel investor?
A)Families and friends of an entrepreneur are not angel investors.
B)Angel investors raise money and then use this money to make investments in new firms.
C)Angel investors make fewer investments than venture capitalists.
D)Angel investors focus on a small number of industries.
E)Angel investors provide initial financing to start-up ventures.

Accepted Answer

Angel investors provide initial financing to start-up ventures.

Question 15

Explain feasibility analysis.

Accepted Answer

The answer of Explain feasibility analysis....

Question 16

Entrepreneurs are most likely to exploit an opportunity when ________.
A)customers are likely to continue using the same product
B)there is no market demand,but an opportunity to create market demand
C)they perceive that they have the support of important stakeholders
D)they want to enhance the prospects of the opportunity by training an incapable management team
E)they feel they do not have access to the resources needed to ensure high levels of organizational performance

Accepted Answer

Entrepreneurs are more likely to exploit an opportunity when they perceive support from important stakeholders, as this support can provide resources, credibility, and networks necessary for successful opportunity exploitation.

Question 17

________ are firms that raise money from investors and then use this money to make investments in new firms.
A)Angel investors
B)Venture capitalists
C)Banking institutions
D)Entrepreneurs
E)Insurance companies

Accepted Answer

Venture capitalists are the entities that raise funds from investors to invest in new and emerging companies, typically in exchange for equity in the companies they invest in.

Question 18

Jose has successfully started a business of repairing cars.However,without immediate income to sustain the business,he may have to close his shop.His friend,Adam,invests in the company and gives the company a much-required boost.In this situation,Adam is a(n)________.
A)bank financier
B)venture capitalist
C)angel investor
D)crowd funder
E)private equity investor

Accepted Answer

Adam is acting as an angel investor by providing capital to a startup (Jose's car repair business) at an early stage to help it grow, typically in exchange for ownership equity or convertible debt.

Question 19

When analyzing entrepreneurial opportunities,the opportunity identification step is,"Where the rubber meets the road."

Accepted Answer

The phrase "where the rubber meets the road" typically refers to the implementation or execution phase, not the opportunity identification step. Opportunity identification is about recognizing potential business ideas or market needs.

Question 20

________ is the third step of the entrepreneurial process.
A)Opportunity identification
B)Opportunity evaluation
C)Opportunity exploitation
D)Opportunity selection
E)Opportunity improvement

Accepted Answer

Opportunity exploitation is the third step of the entrepreneurial process, following opportunity identification and evaluation.

Quiz 2: Management and Entrepreneurship: Handling Start-Ups and New Ventures

When entrepreneurs identify how they will market,produce,and position their new products,they are involved in which of the following entrepreneurial processes?

________ are wealthy individuals who provide capital to new companies.

Which of the following is true about factors that adversely influence the accuracy of an entrepreneur's risk perceptions?

Bob's perception that he has been successful with his past entrepreneurial opportunities and therefore his luck will continue with his latest venture is known as ________.

Exploitation exists when entrepreneurs overestimate the extent to which they can control the outcome of an opportunity.

Which of the following is true about bank financing?

________ refers to the activities and investments committed to gain returns from the new product or service arising from the opportunity.

Describe opportunity exploitation.

Even if an entrepreneur's idea is feasible,opportunities are associated with risk.In this context,________ refers to the resources reduced if an opportunity does not succeed.

When an entrepreneur obtains financing from a financial institution in the form of a loan,it is termed as ________.

What is entrepreneurial risk? In this context,explain downside loss.

Which of the following is true about the differences between angel investors and venture capitalists?

Which of the following best describes an angel investor?

Explain feasibility analysis.

Entrepreneurs are most likely to exploit an opportunity when ________.

________ are firms that raise money from investors and then use this money to make investments in new firms.

Jose has successfully started a business of repairing cars.However,without immediate income to sustain the business,he may have to close his shop.His friend,Adam,invests in the company and gives the company a much-required boost.In this situation,Adam is a(n) ________.

When analyzing entrepreneurial opportunities,the opportunity identification step is,"Where the rubber meets the road."

________ is the third step of the entrepreneurial process.