Question 1

Where do the authors recommend that you look for competitors' information?

Accepted Answer

The authors recommend looking for competitors' information on their websites.

Question 2

What are examples of external factors affecting entrepreneurship?

Accepted Answer

All of the listed factors (market demand, industry trends, customer needs) are external factors that can have a major impact on the success of an entrepreneur's venture. Understanding and responding to these factors is key to maintaining a competitive edge and achieving business goals.

Question 3

Who are initial reference customers?

Accepted Answer

Initial reference customers are the first customers who use your product and are willing to recommend it to others. They provide social proof and can help attract more customers.

Question 4

Which of the following is not a barrier to entry:

Accepted Answer

All the options listed (Capital, Manufacturing, and Marketing) can be considered potential barriers to entry for new firms trying to enter a market. Capital requirements can deter entry due to the need for significant upfront investment. Manufacturing barriers can include the need for specialized facilities or technology. Marketing barriers can involve the challenges of establishing a brand or reaching customers in a market dominated by established players.

Question 5

What should the industry that you will potentially enter balance?

Accepted Answer

To have a successful industry, it is important to balance internal strengths with sector demand. It is crucial to have a favorable supply-demand balance in the industry sector to ensure profitability and sustainability. While fun and innovation are important, they cannot outweigh the importance of meeting the current and future demand in the industry.

Question 6

What is a venture focus?

Accepted Answer

A venture focus refers to the target industry and type of business the entrepreneur is planning to pursue. This helps to narrow down the scope of the business and allows for a more focused approach. B, C, and D are not accurate definitions for venture focus.

Question 7

What is not necessarily an important criteria when trying to select a target industry for starting a venture:

Accepted Answer

An industry that was super hot last year is not necessarily an important criteria when selecting a target industry for starting a venture. The focus should be on the current and projected trends, competition, and activity level in the industry.

Question 8

What are examples of an industry trend:

Accepted Answer

All three options are examples of industry trends. New types of fuel for the energy industry reflect a shift towards renewable energy sources, while the aging of the population is a trend that will impact the healthcare industry as people live longer and require more care. The use of sensors and computers to make cities "smart" is an emerging trend in the public sector as cities seek to improve efficiency and sustainability.

Question 9

What are considered internal factors affecting entrepreneurship?

Accepted Answer

All of the above factors - work experience, education background, and family background and business experience - are considered internal factors that can affect entrepreneurship. Work experience can provide valuable skills and knowledge necessary for starting and running a business, while education background can provide related technical knowledge or business management skills. Family background and business experience can also influence entrepreneurial activities either positively or negatively.

Question 10

What factors do you have to consider when selecting a target industry for a venture:

Accepted Answer

All three factors are important to consider when selecting a target industry for a venture. The technology life cycle stage of the industry overall can affect the level of innovation and competition in the market. The channels of distribution within the industry can affect the cost and ease of reaching customers. Finally, it is important to consider any existing barriers to entry, as these can significantly impact the chances of success for a new venture.

Question 11

What trend should you look for when determining the attractiveness of an industry sector?

Accepted Answer

The upward growth in customer demand for new products and services is a strong indicator of an attractive industry sector. It suggests that there is potential for growth and profitability within the industry, which can be appealing to investors and businesses. The presence of government regulation or large companies making money may not necessarily indicate an attractive industry sector, and modest profitability may suggest limited potential for growth.

Question 12

Effective innovation is most often driven by

Accepted Answer

Talking and interacting with consumers or business customers can reveal the problems they face and provide insights into gaps in the market, which can be addressed with effective innovation. Options A, B, and C are not reliable or ethical methods for driving effective innovation.

Question 13

What is an industry?

Accepted Answer

An industry is a group of firms that produce products and services that are close substitutes for each other. This includes industries such as the automobile industry, technology industry, and healthcare industry. It is distinct from the economy of a country (B) which refers to the overall production, consumption, and distribution of goods and services in a given geographic region. The financial services sector (A) is a subsection of various industries that provide financial products and services such as banking, insurance, and investment management. An individual who works really hard (D) is not a definition of an industry.

Question 14

The LOT-R Test measures a person's:

Accepted Answer

The LOT-R Test measures a person's optimistic attitude - the ability to deal with adversity of all types.

Question 15

Defining the "who" in a venture and articulating who buys your products versus who uses your product, is referred to as your

Accepted Answer

Defining the "who" in a venture and identifying your target customer involves identifying the group of people who are most likely to purchase and use your product or service. This is important for developing marketing strategies and tailoring your product to meet the needs and preferences of your target customer.

Question 16

What is a niche within an industry?

Accepted Answer

A niche within an industry refers to a specific subdivision of an industry that focuses on addressing particular customer groups. This can include specific demographics, interests, or needs that other competitors in the industry might not be addressing, creating a specialized market within the larger industry.

Question 17

What is not a key factor when assessing a potential industry?

Accepted Answer

Exit valuation, while important for investors or entrepreneurs, is not necessarily a key factor when assessing a potential industry. Factors such as industry growth, government regulations, and competitors' activities are typically more important in determining the viability and potential success of a particular industry.

Question 18

Which is not a necessity to know about a new venture during the startup phase?

Accepted Answer

While it is important to have a board of directors in place, it is not a necessity to know about them during the startup phase. The focus should be on the target industry, target customer, and business model to establish a strong foundation for the venture.

Question 19

Entrepreneurs typically want to enter the industry at which stage of the life cycle?

Accepted Answer

Entrepreneurs typically want to enter the industry at the emergent and growth stage because there is high potential for growth and a relatively low level of competition. This stage is characterized by increasing consumer demand, rapid growth in sales and profits, and the entry of new competitors. This presents an opportunity for new entrants to gain market share and establish themselves as key players in the industry. In contrast, the mature stage is characterized by slower growth, increased competition, and a focus on cost-cutting, while the decline stage is characterized by falling sales and profits and a shrinking market size.

Question 20

According to the authors of the text, what should drive the design of your product?

Accepted Answer

The text states that market demand should drive the design of your product, as it is important to create a product that meets the needs and wants of your target customers.

Quiz 1: Defining Your Industry Focus and the Type of Business You Want to Start