Question 1

Manufacturing businesses are the largest and fastest growing segment of small business enterprise.

Accepted Answer

Service-oriented businesses, not manufacturing, represent the largest and fastest-growing segment of small business enterprises.

Question 2

Planning does not have to be complete before action is taken.

Accepted Answer

While it is important to have a plan in place, it does not have to be fully completed before taking action. Plans can be adjusted and revised as necessary while still moving forward.

Question 3

During the period from 2001 to 2011, small businesses created about two-thirds of all the jobs in Canada.

Accepted Answer

The answer of During the period from 2001 to 2011,...

Question 4

Small founding teams tend to work better than big ones when starting a company, and it is quite common for the initial team to consist of just two people: a craftsperson and a salesperson.

Accepted Answer

Small founding teams are often more effective than larger ones when starting a company, and it is common for the initial team to consist of a craftsperson (who can create the product or service) and a salesperson (who can market and sell it).

Question 5

About 75 percent of all businesses in Canada are small.

Accepted Answer

The answer of About 75 percent of all businesses in...

Question 6

The risks of starting a business from scratch are greater than the risks of buying an existing firm.

Accepted Answer

When starting a business from scratch, it involves a lot of uncertainties and requires a lot of resources such as time, capital, and effort. There is no established customer base or proven business model, which increases the risk of failure. On the other hand, buying an existing firm provides a proven track record, an established customer base, existing policies and procedures, and experienced employees. This makes it less risky compared to starting a business from scratch.

Question 7

The most important reason that women give for starting their own business is to gain control of their schedules.

Accepted Answer

According to research, gaining control of their schedules is the most common reason cited by women for starting their own business.

Question 8

A sales forecast is the foundation for determining the financial viability of a venture and the resources needed to start it.

Accepted Answer

A sales forecast projects future sales revenue for a business and helps determine the financial feasibility of the venture. This information is crucial for securing funding, creating a business plan, and making important decisions about resources and investments. Therefore, it is essential for any entrepreneur or business owner to create a realistic sales forecast.

Question 9

Suppliers who provide goods such as inventory are providing trade credit.

Accepted Answer

Suppliers often provide trade credit to their customers, allowing them to purchase goods on credit and pay later. This is a common practice in business-to-business transactions and helps to establish a relationship between the supplier and the customer.

Question 10

A business is at its riskiest point during the start-up phase.

Accepted Answer

During the start-up phase, a business is new and untested, with uncertain revenue streams and unproven products or services. This makes it inherently risky, as the business has not yet established a track record of success or built up a customer base. Additionally, start-ups often require significant financial investment, with the potential for a high rate of failure.

Question 11

Women lead only a small percentage of small- and medium-sized firms that export goods and services.

Accepted Answer

Studies have shown that women lead only a small percentage of small- and medium-sized firms that export goods and services.

Question 12

An idea with high business exit costs is good, because it will motivate the entrepreneur to work hard to achieve success.

Accepted Answer

High business exit costs can deter entrepreneurs from leaving a failing venture, potentially leading to greater losses and discouraging innovation and flexibility.

Question 13

A key difference between intrapreneurs and entrepreneurs is that intrapreneurs typically don't have to concern themselves with getting the resources needed to bring a new product to market.

Accepted Answer

Intrapreneurs work within an existing organization and therefore have access to the resources provided by the organization. Entrepreneurs, on the other hand, typically have to secure their own funding and resources to bring a new product to market.

Question 14

Most new ventures are not the result of a deliberate search for a viable business idea.

Accepted Answer

According to research, most successful new ventures come from unexpected or serendipitous experiences rather than a deliberate search for a viable business idea.

Question 15

Most new venture ideas come from peoples' hobbies.

Accepted Answer

The answer of Most new venture ideas come from peoples'...

Question 16

It is important to assess the "fit" between the various elements in the entrepreneurial process at the outset and then stick with that setup as the business grows.

Accepted Answer

The entrepreneurial process is dynamic, and the "fit" between its elements may need to adjust as the business grows and external conditions change. Flexibility and adaptability are key to navigating the evolving challenges and opportunities.

Question 17

Equity refers to the money, or capital, invested in the enterprise by individuals in return for an ownership interest.

Accepted Answer

Equity is indeed the ownership interest in an enterprise earned by investing money or capital.

Question 18

One source of debt financing is through private investors, also known as angels.

Accepted Answer

The answer of One source of debt financing is through...

Question 19

If market conditions are rapidly changing, the benefits gained from research diminish quickly.

Accepted Answer

Market conditions that are rapidly changing require quick action and decision making. The benefits gained from research may not be applicable or relevant in a constantly changing market, thus diminishing the value of the research.

Question 20

Survival rates for new ventures are greatly improved by getting involved with an incubator.

Accepted Answer

Incubators provide resources, mentorship, and support that can increase the likelihood of success for new ventures. They also offer networking opportunities and access to funding, which are crucial for long-term survival of startups.

Quiz 4: Entrepreneurship, Small Business, and New Venture Creation