Deck 6: Managing Start Ups and New Ventures

Question 1

Approximately 600,000 new businesses are launched in the U.S. each year by entrepreneurs.

Answer 1

True

Question 2

Social entrepreneurs are leaders who are committed to both good business and ensuring high profitability.

Answer 2

False

Question 3

Entrepreneurship and small business in the United States is an engine for job creation and innovation.

Answer 3

True

Question 4

Optimizers are rewarded by chance to work on something new and creative.

Question 5

Entrepreneurs in the sustainer category are rewarded by the personal satisfaction of being business owners.

Question 6

China is the most entrepreneurial country, with 24 percent of individuals age 18 to 64 starting a new business.

Question 7

Minorities show a high rate of entrepreneurship in the United States, owning 5.8 million firms in 2007 that generated $1 trillion in revenues.

Question 8

Small businesses, according to the Small Business Administration, employ more than 90 percent of the private workforce in the United States.

Question 9

Particularly in a turbulent environment, the three most important traits of successful entrepreneurs are realism, flexibility, and passion.

Question 10

Social entrepreneurs have a primary goal of improving society rather than maximizing profits.

Question 11

Entrepreneurs in the sustainer category like the chance to balance work and personal life and often don't want the business to grow too large.

Question 12

During turbulent times, small business formation is the primary process by which an economy recreates and reinvents itself.

Question 13

A need to achieve is a psychological characteristic that means people are motivated to excell and pick situations in which success is likely.

Question 14

Sole proprietorships are one of the fastest growing segment of small business.

Question 15

Women and minorities who have found their opportunities limited in the corporate world are seeing intrapreneurship as the only way to go.

Question 16

Immigrants are more likely to start small businesses than native-born Americans.

Question 17

Social entrepreneurship combines the creativity, business smarts, passion, and hard work of the traditional entrepreneur with a mission to change the world for the better.

Question 18

Entrepreneurs in the optimizer category are rewarded by the personal satisfaction of being business owners.

Question 19

The process of initiating a business venture, gathering and organizing the appropriate resources, and assuming the associated risks and rewards refers to entrepreneurship.

Question 20

Entrepreneurs are able to deal easily with delays and exhibit high levels of patience, knowing that the results will be worth the wait.

Question 21

Borrowing from family and friends is a common source of debt financing for a start-up business.

Question 22

The drawbacks of proprietorship include unlimited liability and difficulty in obtaining financing.

Question 23

The advantage of buying an existing business is the ability to develop and design the business in the entrepreneur's own way.

Question 24

A domain name gives a company an address on the Web and a unique identity.

Question 25

Setting standards too high is a common pitfall for keeping a small business running successfully.

Question 26

A venture capital firm is a group of companies or individuals that invests money in new or expanding businesses for ownership and potential profits.

Question 27

A document specifying the business details prepared by an entrepreneur prior to opening a new business is known as a business plan.

Question 28

An attractive innovation for entrepreneurs who want to start a business from scratch is to join a business incubator.

Question 29

Entrepreneurs see themselves as being less in control of their environment, generally speaking, and can be expected to have an external locus of control.

Question 30

The owner should start implementing more structured control systems by Stage 3 of growth for an entrepreneurial firm.

Question 31

The most common source of new business ideas comes from in-depth understanding of an industry or profession.

Question 32

Since a corporation is a legal structure reserved for large firms, small businesses have two basic choices for legal structure of their company: proprietorship and partnership.

Question 33

A business plan for a small business should be detailed, encompassing at least 100 pages.

Question 34

The first step in pursuing an entrepreneurial dream is to come up with a viable idea.

Question 35

Two principle advantages of forming a corporation are continuity and limits on the owners' liability.

Question 36

Equity financing is when funds are invested in exchange for ownership in the company.

Question 37

The Small Business Administration (SBA) can provide loan financing for small business start-up.

Question 38

To succeed in the competitive online market, aspiring entrepreneurs need to identify a market niche that isn't being served by other companies.

Question 39

The failure rate for high-tech business is lower than the failure rate for conventional businesses.

Question 40

A sole proprietorship an unincorporated business owned by two or more people.

Question 41

Which of these means that people are motivated to excel and pick situations in which success is likely?

A) External locus of control
B) Tolerance for Ambiguity
C) Awareness of passing time
D) Internal locus of control
E) Need to achieve

Question 42

Connie, a single mother and home-business entrepreneur, enjoys running her own business. However, because she is busy balancing work and family, she does not foresee her home business growing significantly in the near future. Connie can best be described as what type of entrepreneur?

A) Idealist
B) Sustainer
C) Optimizer
D) Juggler
E) Hard worker

Question 43

Which of the following are high-energy people who enjoy handling every detail of their own businesses?

A) Jugglers
B) Idealists
C) Sustainers
D) Optimizers
E) Hard workers

Question 44

The Small Business Association (SBA) reports that small businesses create at least _____ percent of America's new jobs.

A) 30
B) 32
C) 46
D) 64
E) 82

Question 45

Being interested in computers, Jose Cohata came up with an idea of personalizing the screen saver programs with family pictures. After trying a couple of programs, Jose started marketing this service to neighbors and area businesses. Jose's activities can be described as a(n) _____.

A) entrepreneurship
B) intrapreneurship
C) useless idea
D) large business
E) partnership

Question 46

What percentage of women entrepreneurs have employees?

A) Five
B) Ten
C) Twenty
D) Fifty
E) Eighty

Question 47

An entrepreneur:

A) assumes the risks of the business.
B) reaps the rewards of the business.
C) assumes the financial and legal risks of ownership.
D) recognizes a viable idea for a business product or service and carries it out.
E) all of these.

Question 48

Today, inspired by the growth of companies such as Amazon.com, entrepreneurs are flocking to the _____ to start new businesses.

A) Small Business Administration
B) Internet
C) bookstore
D) mall
E) Internal Revenue Service

Question 49

Which of the following demographic factors distinguish entrepreneurs from others?

A) They are likely the youngest child in their family.
B) Most entrepreneurs launch their businesses between the ages of 35 and 55.
C) Their parents likely worked for large companies.
D) They are likely the children of immigrants.
E) All of these.

Question 50

In 2012, which country had the largest percentage of individuals age 18 to 64 that were active in starting or managing a business?

A) China
B) Peru
C) Columbia
D) Angola
E) Dominican Republic

Question 51

A(n) _____ is someone who recognizes a viable idea for a business product or service and carries it out.

A) intrapreneur
B) entrepreneur
C) manager
D) leader
E) introvert

Question 52

If a small business owner enjoys the chance to balance work and personal life, he would be considered a(n) _____.

A) idealist
B) optimizer
C) hard worker
D) juggler
E) sustainer

Question 53

Tracy's Trikes believes that each employee should enjoy the idea of working on something that is new, creative, or personally meaningful. Tracy's Trikes exemplifies which of the categories of small business owners?

A) Optimizers
B) Idealists
C) Hard workers
D) Sustainers
E) Jugglers

Question 54

Small firms that file for patents typically produce _____ more patents per employee than large patenting firms.

A) twice
B) 3 to 4 times
C) 6 to 7 times
D) 9 to 10 times
E) 13 to 14 times

Question 55

In the United States, minorities own _____ firms.

A) 5.8 million
B) 1.3 billion
C) 872,000
D) 8.9 million
E) 2.9 million

Question 56

Andrew, a young entrepreneur, feels sure about his ability to win customers through his people skills. He is comfortable with his ability to handle technical details and feels that he is able to keep his business moving. This most closely relates to which personality trait of entrepreneurs?

A) Need to achieve
B) Impatience
C) Tolerance for ambiguity
D) High energy level
E) Self-confidence

Question 57

Celine has an unwavering belief in her new start-up company. She possesses intense focus and takes unconventional risks to make her new company successful. These examples most closely relate to which personality trait of entrepreneurs?

A) Need to achieve
B) Patience
C) Tolerance for ambiguity
D) High energy level
E) Self-confidence

Question 58

Which of the following is the process of starting a business venture, organizing the resources, and taking the risks?

A) Intrapreneurship
B) Entrepreneurship
C) Small business administration
D) Venture capital
E) Equity financing

Question 59

Which of the following is the type of business that most entrepreneurs start?

A) Retail
B) Manufacturing
C) Service
D) All of these
E) Retail and manufacturing only

Question 60

Small businesses represent _____ percent of all firms and employ about half of all private sector employees.

A) 87
B) 22
C) 98
D) 54
E) 72

Question 61

Vaughn Hager started his one-man consulting business under the name Hager Associates. The legal structure for the company can best be described as a(n):

A) proprietorship.
B) partnership.
C) trade alliance.
D) corporation.
E) one man operation.

Question 62

The drawback(s) of proprietorship include:

A) the unlimited liability of the partners.
B) conflicts with partners.
C) existence regardless of whether the owners live or dies.
D) difficulty in obtaining financing.
E) complexity and cost.

Question 63

Melissa is a very good middle manager. However, she has long wanted to open her own business. Which of Melissa's characteristics is not consistent with entrepreneurship?

A) Melissa has high self-confidence.
B) Melissa tends to put things off till later.
C) She is untroubled by uncertainty.
D) She has a high energy level.
E) She has high need to achieve.

Question 64

Before opening his own business, Kareem was writing a report that details the specifics of his ideas and future business operations. This document is known as a:

A) SWOT analysis.
B) business portfolio.
C) business plan.
D) competitive analysis.
E) mission statement.

Question 65

A(n) _____ has a legal life of its own.

A) partnership
B) proprietorship
C) corporation
D) association
E) trade alliance

Question 66

Blake, Madison and Sean started selling computer software on college campuses under the name Student Software Company. Each person contributed $1500 toward start-up costs and agreed on dividing costs and profits equally. The legal structure for the company can best be described as:

A) a proprietorship.
B) a partnership.
C) a trade alliance.
D) a corporation.
E) none of these.

Question 67

One of the first characteristics or points of a successful business plan is:

A) a profile of potential customers and market needs.
B) demonstrate a clear, compelling vision that creates an air of excitement.
C) the key ingredient of the business that will attract million of customers.
D) the entrepreneur's background and role in the company.
E) essential information about funding received so far.

Question 68

Which of these refers to an unincorporated business owned by an individual for profit?

A) Partnership
B) Sole proprietorship
C) Corporation
D) Association
E) Trade alliance

Question 69

Ginger likes to set her own goals, which have an intermediate level of difficulty. Which of the entrepreneurial characteristics does she probably possess?

A) A high need for achievement
B) A high need for power
C) An external locus of control
D) An inability to deal with uncertainty
E) Intolerance for ambiguity

Question 70

An artificial entity created by the state and existing apart from its owners is known as:

A) a partnership.
B) a proprietorship.
C) a corporation.
D) an association.
E) a trade alliance.

Question 71

What is the primary goal of the social entrepreneur?

A) Maximizing profits
B) Improving society
C) Reaching social circles
D) Finding funding
E) Writing grants

Question 72

All of the following are common reasons why small business ventures fail except:

A) sloppy accounting.
B) naive hiring.
C) lack of controls.
D) long-term focus.
E) unrealistic focus.

Question 73

What are the two principal advantages of forming a corporation?

A) Unlimited liability and potential conflicts with partners
B) Freedom from debt and relatively simple structure
C) Continuity and limits on owner's liability
D) Unlimited liability and continuity
E) Continuity and non-tax structure

Question 74

Which of the following is the most cited source of new business ideas?

A) Brainstorming
B) In-depth understanding of industry/profession
C) A hobby
D) Copying someone else
E) None of these

Question 75

_____ combines creativity, business smarts, passion, and hard work of the traditional entrepreneur with a mission to change the world for better.

A) Contemporary entrepreneurship
B) Traditional entrepreneurship
C) Modern-day entrepreneurship
D) Social entrepreneurship
E) Conventional entrepreneurship

Question 76

Which of the following is an unincorporated business owned by two or more?

A) A partnership
B) A proprietorship
C) A corporation
D) An association
E) A trade alliance

Question 77

The most common reason for becoming an entrepreneur is:

A) joining the family business.
B) to control one's future.
C) to be one's own boss.
D) to fulfill a dream.
E) the result of being laid off.

Question 78

Which of the following is a popular small business form because it is easy to start and has few legal requirements?

A) A partnership
B) A proprietorship
C) A corporation
D) An association
E) A trade alliance

Question 79

Which of the following is NOT an appropriate legal structure for an entrepreneurial company?

A) Proprietorship
B) Corporation
C) Partnership
D) Trade alliance
E) All of these are appropriate legal structures for an entrepreneurial company.

Question 80

Social entrepreneurs are committed to both good business and:

A) swaying political opinion of consumers.
B) improving the natural environment.
C) positive social change.
D) non-profit goals.
E) big profits.