Deck 3: Opportunity Recognition, Shaping, and Reshaping

Question 1

A company will make a better growth decision by identifying the most lucrative PTA.

Answer 1

True

Question 2

A penetration pricing strategy is one of the most simple and successful initial approaches for a new venture.

Answer 2

False

Question 3

An entrepreneur should try to broaden his or her customer base definition at the early stages of developing an idea.

Answer 3

False

Question 4

New, entrepreneurial ideas frequently sprout from an entrepreneur's desire for a product that he or she cannot currently find in the market.

Question 5

According to IDEO, the first step in the creation of a product is to make a set of assumptions.

Question 6

You will likely fail if you start a business in an area you have no experience in

Question 7

No one knows about your strengths better than you do.

Question 8

The S-curve is a forecasting tool designed to measure the power of competition.

Question 9

To target goods and services specifically to Hispanic populations in the US is to focus one's market too narrowly.

Question 10

The key to success in comedy improvisation is to always say, "Yes, but…"

Question 11

In aggregate, baby boomers create powerful trends for US businesses.

Question 12

The first domain name on the Web was assigned in 1986.

Question 13

Starting a company in a sphere of business that you really enjoy is not the best idea, in terms of the chance of success.

Question 14

Customer and market trends change too rapidly to be of any predictive use for an entrepreneur.

Question 15

Playing the role of devil's advocate is important at the "optimize practicality" stage of concept development.

Question 16

Saying, "That will not work because…" is important at later stages of business development.

Question 17

Asking leading questions is the best method of discovering the appeal of a potential product or concept.

Question 18

Cocktail-party entrepreneurs can provide you with invaluable advice about how to run a venture

Question 19

Most successful ideas are driven by the entrepreneur's personal experience.

Question 20

The market enters a fast growth phase when customer awareness and demand exceed supply.

Question 21

Pre-launch analysis will determine the required variables of your business model and should be assumed to be true in the absence of contrary facts.

Question 22

It typically takes 1-2 years for a firm to reach stability and for operating costs to stabilize.

Question 23

It is important to lower your gross margins early in the venture's life

Question 24

On what category of customers should a startup business focus most of its attention?
a. STA
b. PTA
c. TTA
d. An even share of STA, PTA, and TTA
e. None of the above

Question 25

The cost-plus pricing technique is the most reliable one as it sets the price equal to the product's value.

Question 26

When starting web business, which measure of effectiveness matters most?
a. The number of "eyeballs" looking at your site
b. Profits
c. Click thru rates
d. Overhead expenses
e. Revenue

Question 27

Which of the following is not a part of IDEO's product design steps?

A) Optimize practicality
B) Multiply stimuli
C) Gather stimuli
D) Create customer concepts
E) Create stimuli

Question 28

What does moving a seed of an idea to a more concrete possibility require?

A) Practical thinking
B) Market research
C) Input from others
D) A business plan
E) Maturity

Question 29

It is important to evaluate the value chain you are competing in and the different options there are to distribute your product.

Question 30

There is no need to worry about competitors in emerging markets, since they are recently emerging.

Question 31

A startup will likely fail if the entrepreneur ignores feedback from his or her customers.

Question 32

What is the only action that the "gather stimuli" stage requires of the entrepreneur?

A) Ask
B) Think
C) Do nothing
D) Observe
E) Research

Question 33

A venture whose vendors are primarily commodity suppliers, will retain a large portion of the value chains gross margin.

Question 34

Which of the following most typifies a "cocktail entrepreneur?"

A) Fails to take action
B) Popular
C) Productive
D) Decisive
E) Possesses a predilection for cocktails

Question 35

In which stage is it important to play devil's advocate?
a. Optimize practicality
b. Multiply stimuli
c. Gather stimuli
d. Create customer concepts
e. Create stimuli

Question 36

A highly priced product will usually be perceived as better quality by the customer.

Question 37

According to the chapter, into what type of opportunity should a business idea translate?

A) Realistic
B) Easy to implement
C) Attractive
D) Unique
E) Technologically advanced

Question 38

Customers can assist you to determine direct competitors, indirect competitors, and substitutes.

Question 39

Stringent government approval processes may not signal a poor opportunity if potential margins are still relatively high.

Question 40

The graphical depiction that highlights the diffusion of product acceptance over time is:
a. S-Curve
b. C-Curve
c. U-Curve
d. V-Curve
e. J-Curve

Question 41

When pre-launch analysis predicts unfavorable outcomes you should:
a. Abandon the venture
b. Go forward strongly in spite of negative forecasts
c. Seek to confirm/deny the variable that underpin outcomes during execution
d. Seek to confirm/deny all variable prior to starting the venture

Question 42

What is the short-sighted thinking behind the penetration-pricing strategy?
a. Pricing below competitors will lead to higher market share
b. Gross margins should be very high for a new product.
c. Loyal customers demand the lowest price.
d. The simplest method of selective prices saves time.
e. Prices should match the value of products.

Question 43

Which of the following is an example of a perfect business?
a. Intel
b. Wal-Mart
c. Amazon.com
d. McDonalds
e. There is no such thing as a perfect business

Question 44

Which of the following is NOT related to competitive profiling?
a. Net margins
b. Revenues
c. Tax rates
d. Pricing

Question 45

Better Opportunities tend to exist when:
a. The core customer group is small
b. There is existing and strong competition
c. The net margins greater than 10%
d. There are mature market structures