Deck 13: Managing Growth

Question 1

Effective planning for the future of a business requires:

A) connection with lenders.
B) an understanding of the life cycle of the business.
C) the use of regional development plans for the business's market area.
D) total sales revenue equal to equity invested times a factor of ten.

Answer 1

B

Question 2

In what stage of the business life cycle does the owner's responsibility become much more managerial?

A) Introduction
B) Decline
C) Growth
D) Maturity

Answer 2

D

Question 3

It is noted in the text that unless a business is growing:

A) it's shrinking.
B) it's losing employees.
C) it's building debt.
D) it's stagnating.

Answer 3

D

Question 4

Two distinctions between a small and large business are:

A) more attractive window displays and speedier delivery of merchandise.
B) higher volume and larger transactions.
C) quality of life for employees and technology infrastructure.
D) employee morale and customer satisfaction.

Question 5

The following expense categories are particularly significant during growth periods:

A) research and development of markets.
B) executive salaries.
C) rent.
D) entertaining potential customers.

Question 6

The business cycle and the product life cycle:

A) are of little value to know.
B) are always different.
C) are sometimes the same as one another.
D) are never determinable.

Question 7

At the end of a growth stage:

A) a business will not have any competition.
B) a business will have significant cash balances on hand.
C) a business will need to make changes in its business strategy.
D) a business will be able to coast along without entering a decline stage.

Question 8

One of the biggest challenges facing growth companies is:

A) human resources.
B) technology.
C) marketing.
D) financial planning.

Question 9

Success and growth can:

A) make a business more difficult to manage.
B) make life as an owner manager simpler and more enjoyable.
C) lead to streamlining and simplifying the management of a business.
D) help to overcome complexity.

Question 10

An acknowledged advantage of a larger growing business is:

A) more influence in the industry.
B) more comfortable corporate offices.
C) more social contacts in the owner's community.
D) an easier time raising capital.

Question 11

The start-up stage of a business is known for its:

A) growth characteristics.
B) low profits.
C) expansion of product lines.
D) level sales results.

Question 12

Which is not what owner-managers should do to try to ensure long-term viability early in the life of the business?

A) Need to understand the life cycle of the business
B) Take specific steps in planning for growth of the business
C) Ensure the location infrastructure is suitable for long-term needs of the business
D) Be aware of some of the more common growth problems a business is likely to face

Question 13

High growth firms in Canada:

A) often do not make any money for many years.
B) are able to accumulate significant cash balances to fund further growth.
C) usually fund growth from current sales.
D) inevitably become profitable.

Question 14

A business can become more competitive by:

A) adding new products or expanding to new markets.
B) improving its factory decor.
C) lowering cost prices in order to increase sales.
D) firing employees.

Question 15

When it comes to growth, management often:

A) puts more merchandise on the shelves and hopes for the best.
B) seeks guidance from suppliers for growth strategies.
C) overlooks the importance of planning.
D) injects their personal funds to finance growth.

Question 16

Which is not a common strategy for pursuing growth?

A) Add new products or services
B) Acquire other small companies
C) Increase sales of existing products or services
D) Find existing uses for the product or service

Question 17

Human resource needs of growth can be addressed by:

A) paying higher wages than competitors.
B) enhancing the skills of current employees
C) purchasing technology to control increased operations.
D) advertising new job openings.

Question 18

In the decline stage of a business:

A) sales may decline but profits usually remain constant.
B) nothing can be done to halt the decline.
C) sales may increase for a while but profits decline steadily.
D) both sales and profits usually decline.

Question 19

Before choosing to grow it is important to determine:

A) how much it will cost to terminate employees if growth doesn't happen.
B) if competitors will permit the business to grow.
C) if customers will support the initiative.
D) whether the product can grow in sales.

Question 20

As a business grows:

A) it becomes easier to find and integrate new employees.
B) owners often need to let go of managing all parts of the operation.
C) departments and individuals begin to work together more productively.
D) owners and employees tend to develop closer relationships.

Question 21

As a business grows:

A) it becomes easier to control.
B) control becomes a less significant concern.
C) it becomes more difficult to control.
D) it is better able to afford outsourcing managerial control.

Question 22

Growth planning requires attention to external forces such as:

A) owner's income goals.
B) social and cultural norms.
C) average cost per unit of product.
D) age of company fleet of delivery vehicles.

Question 23

Which is not a managerial control that would be implemented during business growth?

A) Ratio analysis
B) Restrict sales volumes
C) Benchmarking
D) Margins

Question 24

Franchising is a strategy that may:

A) overcome the weakness of a poor product.
B) provide management with more borrowed funds.
C) enable high growth with limited capital.
D) not be possible to control.