Question 1

Getting into business today is easier and faster than ever before and there are many more potential opportunities than at any other time in history.

Accepted Answer

With advancements in technology and increased access to information and resources, the barriers to starting a business have decreased, creating a greater number of potential opportunities for entrepreneurs.

Question 2

According to the Small Business Administration, small businesses account for a small percentage of all U.S. exports.

Accepted Answer

This statement is false. Small businesses account for a significant portion of all U.S. exports. In fact, according to the U.S. Department of Commerce, small and medium-sized enterprises make up over 98% of all U.S. exporters and are responsible for more than one-third of all U.S. merchandise exports.

Question 3

Small business ⎯ especially in certain industries ⎯ is an important source of new (and often well-paid) jobs in the United States.

Accepted Answer

Small businesses, particularly those in industries such as technology and healthcare, have been a significant driver of job growth in the US. These new jobs often offer competitive salaries and benefits, contributing to the overall prosperity of local communities and the country as a whole.

Question 4

Any start-up or new venture may succeed and grow to become a large business, succeed but remain small, fail and shut down, or be bought by an existing business.

Accepted Answer

This statement is true. There are multiple possible outcomes for any start-up or new venture.

Question 5

More than any other industry, manufacturing lends itself to small business.

Accepted Answer

Manufacturing often requires significant capital investment, specialized equipment, and a skilled workforce, making it less accessible for small businesses compared to industries like retail or services.

Question 6

Small business is a strong presence in the U.S.economy, but that is not true of most of the world's mature economies.

Accepted Answer

Small businesses are a significant presence in economies around the world, including mature economies, where they contribute to job creation, innovation, and economic diversity.

Question 7

A first-mover enters a segment of a market that offers a new opportunity because it is not currently being satisfied.

Accepted Answer

A first-mover typically identifies a new opportunity in a segment of the market that is not being satisfied, and enters the market in order to capture market share before competitors emerge.

Question 8

The purpose of the SBA's SCORE program is to evaluate the managerial performance of small businesses and then to assign scores that are used to determine the amount of loans that individual businesses can obtain.

Accepted Answer

The purpose of the SBA's SCORE program is to provide free business mentorship and counseling to small businesses to help them grow and succeed. It does not evaluate managerial performance or assign scores for loans.

Question 9

The Internet has virtually rewritten all of the rules for starting and operating a small business.

Accepted Answer

The Internet offers numerous tools and resources for small businesses, including access to a global market, cost-effective marketing strategies, and the ability to operate remotely. As a result, small businesses can now thrive without the traditional limitations and expenses of brick-and-mortar establishments.

Question 10

Most U.S. workers are employed by large firms.

Accepted Answer

Most U.S. workers are employed by small businesses, which are defined as firms with fewer than 500 employees. These small businesses account for a significant portion of the workforce.

Question 11

Market research is a key step in building a business plan.

Accepted Answer

Market research helps entrepreneurs to understand their target market, competitors, and industry trends. This information is critical in developing a comprehensive business plan that includes a well-defined target audience, marketing strategies, and financial projections. Hence, market research is an essential step in building a successful business plan.

Question 12

History has shown that major innovations are as likely to come from small businesses (or individuals) as from big businesses.

Accepted Answer

Many major innovations throughout history, from the personal computer to the telephone, have been developed by small businesses or individuals rather than large corporations.

Question 13

The business plan should describe the match between the entrepreneur's abilities and the requirements for producing and marketing a particular product or service.

Accepted Answer

The business plan should not only describe the match between the entrepreneur's abilities and the product or service, but also include other important aspects like market analysis, financial projections, and operational strategy.

Question 14

Professional managers, whose job is running someone else's business, are entrepreneurs.

Accepted Answer

While professional managers may exhibit some entrepreneurial characteristics, they are not considered entrepreneurs as their job is to manage and grow an established business owned by someone else. Entrepreneurs typically start their own businesses from scratch or invest in early-stage companies.

Question 15

Professional managers who run someone else's business are not entrepreneurs.

Accepted Answer

Professional managers who run someone's business can still exhibit entrepreneurial qualities by innovating, taking risks, and making strategic decisions to grow and improve the business, aligning with the broader definition of an entrepreneur.

Question 16

The idea of a business plan is not new. What is new is the growing use of specialized business plans by entrepreneurs, mostly because creditors and investors demand them for use in deciding whether to help finance a small business.

Accepted Answer

The statement correctly states that the idea of a business plan is not new, but emphasizes the growing use of specialized plans due to demand from creditors and investors.

Question 17

The risks of starting a business from scratch are less than those of buying an existing firm.

Accepted Answer

Starting a business from scratch involves more uncertainty and risk as there is no established customer base, reputation or track record. Buying an existing firm can also have its own risks such as hidden liabilities or outdated business practices, but it has a proven business model and existing assets that can mitigate some of the risk.

Question 18

If someone is technically challenged, they should avoid starting a business because e-commerce is where small businesses are finding success.

Accepted Answer

While e-commerce may be a popular avenue for small businesses, it is not the only option available. Someone who is technically challenged can still start a successful business in other industries or through traditional brick-and-mortar methods. However, they may need to seek assistance or training in certain areas to ensure their business runs smoothly.

Question 19

The purpose of the SBA's SBDC program is to consolidate information from various disciplines and institutions, including technical and professional schools.

Accepted Answer

The purpose of the SBA's SBDC program is to provide assistance to small businesses by consolidating information from various disciplines and institutions, including technical and professional schools.

Question 20

The more resources an industry requires, the harder it is to start a business and the less likely that the industry is dominated by small firms.

Accepted Answer

This statement is true as industries that require more resources such as capital, technology, and specialized skills are more likely to be dominated by larger firms that have the necessary resources to start and compete in the market. Small firms may find it difficult to enter and survive in such industries.

Quiz 9: Managing Start-Ups and New Ventures