Question 1

As discussed in the Opening Profile to Chapter 12, a large percentage of small to medium-sized business owners in Canada __________.

Accepted Answer

Many small to medium-sized business owners in Canada lack a formal succession plan even though they intend to retire within the next five years.

Question 2

As discussed in the Opening Profile to Chapter 12, Gerald Schwartz is an example of a very successful entrepreneur who __________.

Accepted Answer

Gerald Schwartz is an example of a very successful entrepreneur who likes to buy distressed businesses, improve them, and then sell them.

Question 3

As discussed in the text, research has shown that the failure rate of new businesses within the first three years is __________.

Accepted Answer

The answer of As discussed in the text, research has...

Question 4

Which of the following is not one of the three general categories of pitfalls that an entrepreneur needs to be aware of to ensure the survival of their business?

Accepted Answer

The answer of Which of the following is not one...

Question 5

As discussed in the text, the most common reason cited for bankruptcy among young Canadian companies is (are) __________.

Accepted Answer

The answer of As discussed in the text, the most...

Question 6

As discussed in the text, starting a business based on an idea or hobby can prove to be a problem for a young company for which of the following reasons?

Accepted Answer

The owner's passion for the hobby may blind them to the reality that there might not be a viable market or opportunity for the business to succeed.

Question 7

Common pitfalls of young companies include which of the following?

Accepted Answer

Young companies often face multiple challenges, including starting with a weak business idea, poor financial management, HR issues, and failure to implement their business plan effectively.

Question 8

Which of the following is not a common pitfall of young companies, as discussed in the text?

Accepted Answer

The answer of Which of the following is not a...

Question 9

"It is easy to design a cost control system on paper, but it is much tougher to execute one, especially if you have not done this in the past"- this is the description of which Management Problem

Accepted Answer

The statement describes the difficulty in executing a cost control system, which directly relates to the problem of failing to anticipate or control costs.

Question 10

"Rather than creating a true opportunity, they assume that since they love something and they want to work in a related business, they can make money."- this is the description of which Management Problem

Accepted Answer

This statement describes the problem of starting a business based on an idea or hobby without considering its market viability or profitability.

Question 11

"an inability to hire people, problems attracting excellent employees"- this is the description of which Management Problem

Accepted Answer

This description refers to human resource problems, specifically issues related to hiring and attracting qualified employees.

Question 12

"some entrepreneurs can write a great business plan, they may actually lack the skills to implement the plan properly."- this is the description of which Management Problem

Accepted Answer

The statement describes a situation where entrepreneurs can create a business plan but lack the skills to execute it, which directly relates to failing to execute a business plan.

Question 13

"results of quick expansion often cause businesses to borrow additional funds, expand operations, and/ or act without planning."- this is the description of which Management Problem

Accepted Answer

The description matches the problem of "Trying to grow too quickly," where rapid expansion leads to borrowing, expanding operations, and acting without adequate planning.

Question 14

"spending two to three years researching their idea prior to starting their company, and then work 50- to 80-hour weeks during the early years"- this is the description of which Management Problem

Accepted Answer

The description highlights the intense workload and long hours that can lead to entrepreneur burnout.

Question 15

A human resource problem common to a young business that the entrepreneur has relatively little control over is (are) __________.

Accepted Answer

Attracting top-performing salespeople to join an unproven company is challenging because the company's reputation and stability are not yet established, making it difficult to compete with more established firms.

Question 16

As discussed in the text, Canadian companies that manage to survive their first five years are more prone to fail due to __________.

Accepted Answer

Canadian companies that survive the initial years often face challenges related to managing growth, which can lead to mistakes and potential failure.

Question 17

As discussed in the text, mature firm management problem(s) include which of the following?

Accepted Answer

Mature firms can face a range of management problems, including ineffective use of outside advisors, poorly planned expansions, human resource challenges like losing key employees, and difficulties in transitioning from entrepreneurial to managerial roles.

Question 18

Which of the following was not a mature firm management problem discussed in the text?

Accepted Answer

The answer of Which of the following was not a...

Question 19

For a mature firm, a poorly planned or executed expansion can be a problem for the business for which of the following reasons?

Accepted Answer

A poorly planned or executed expansion can cause the entrepreneur to lose focus on profitable products or markets and can also lead to an expansion into unprofitable products, which can drain valuable cash from the business.

Question 20

To be successful managing a mature firm, an entrepreneur __________.

Accepted Answer

Managing a mature firm requires more emphasis on careful planning and risk management, as opposed to the more flexible and adaptive approach often needed during the start-up phase.

Quiz 12: Informal Risk Capital, Venture Capital, and Going Public