Question 1

As discussed in the text, the first step in attempting to determine the market potential for a new venture is to __________.
A) identify all competitive offerings within the local market
B) define the market
C) gather national industry trends for the specific venture
D) decide on the scope of the business
E) None of the answers apply.

Accepted Answer

Defining the market is the first step in determining the market potential for a new venture.

Question 2

When collecting market information the entrepreneur should attempt to __________.
A) evaluate general environmental trends
B) evaluate trends in the specific industry of the new venture
C) assess the local market where the venture will be located
D) analyze the competitive environment for the new venture
E) All of the answers are correct.

Accepted Answer

An entrepreneur should consider all aspects: general trends, industry-specific trends, local market conditions, and the competitive environment to make informed decisions.

Question 3

When collecting market information to determine the market potential of the new venture, the entrepreneur should __________.
A) start with very specific information and work up to more broad-based data and information
B) draw from all available sources of information
C) start with very broad-based data and information and work down to more specific information
D) rely only on publicly-funded sources of information as they are the most unbiased
E) None of the answers apply.

Accepted Answer

The entrepreneur should start with broad-based data to understand the general market landscape and then narrow down to specific information to identify niche opportunities and detailed insights.

Question 4

When collecting market information to determine the market potential of the new venture, general environmental trends of interest would include which of the following?
A) household income trends
B) population shifts
C) industry-specific consumption trends
D) employment trends
E) All of the answers are correct.

Accepted Answer

All the options listed are general environmental trends that can influence the market potential of a new venture. Understanding household income, population shifts, industry-specific consumption, and employment trends can provide valuable insights into market opportunities and challenges.

Question 5

As discussed in the text, when collecting market information to determine the potential for the venture, the entrepreneur should first attempt to __________.
A) evaluate general environmental trends
B) evaluate trends in the specific industry of the new venture
C) assess the local market where the venture will be located
D) analyze the competitive environment for the new venture
E) None of the answers apply.

Accepted Answer

The entrepreneur should first evaluate general environmental trends to understand the broader context and potential opportunities or threats that could impact the venture.

Question 6

As discussed in the text, when collecting market information to determine the potential for the venture, the second task for the entrepreneur should be to __________.
A) evaluate general environmental trends
B) evaluate trends in the specific industry of the new venture
C) assess the local market where the venture will be located
D) analyze the competitive environment for the new venture
E) None of the answers apply.

Accepted Answer

The second task for the entrepreneur, after evaluating general environmental trends, is to evaluate trends in the specific industry of the new venture to understand industry dynamics and potential opportunities or threats.

Question 7

As discussed in the text, when collecting market information to determine the potential for the venture, the third task for the entrepreneur should be to __________.
A) evaluate general environmental trends
B) evaluate trends in the specific industry of the new venture
C) assess the local market where the venture will be located
D) analyze the competitive environment for the new venture
E) None of the answers apply.

Accepted Answer

The answer of As discussed in the text, when collecting...

Question 8

As discussed in the text, when collecting market information to determine the potential for the venture, the fourth task for the entrepreneur should be to __________.
A) evaluate general environmental trends
B) evaluate trends in the specific industry of the new venture
C) assess the local market where the venture will be located
D) analyze the competitive environment for the new venture
E) None of the answers apply.

Accepted Answer

The fourth task for the entrepreneur is to analyze the competitive environment for the new venture, which involves understanding the competition and how it might impact the venture's success.

Question 9

The end result(s) of the four-step gathering market information process discussed in the text should be__________.
A) to clarify the product or service offering
B) to determine the actual market positioning in the competitive environment
C) to help set the market objectives for the new venture
D) All of the answers are correct.

Accepted Answer

The four-step gathering market information process aims to clarify the product or service offering, determine market positioning, and help set market objectives, making all the options correct.

Question 10

A feasibility study of the manufacturing operations for a new venture would include which of the following types of information?
A) equipment required
B) location and type of facility required
C) sources of raw materials
D) labour skills required
E) All of the answers are correct.

Accepted Answer

A feasibility study for manufacturing operations would include all these aspects: equipment, location, raw materials, and labor skills.

Question 11

A study that included information on the location, facility, equipment, processes, raw materials, labour skills, overhead expenses, and space for a new business venture would most likely to be which of the following?
A) market feasibility study
B) manufacturing operations feasibility study
C) business plan
D) marketing plan
E) None of the answers apply.

Accepted Answer

A manufacturing operations feasibility study focuses on the practical aspects of setting up a production facility, including location, equipment, processes, and other operational factors.

Question 12

The entrepreneur and his or her family must make a total commitment to the business in order to be able to meet the demands of a new venture.
A) it is very possible to operate a new venture on a part-time basis while still holding on to a full-time position
B) it is difficult to operate a new venture on a part-time basis while still holding on to a full-time position
C) it is very easy to operate a new venture on a part-time basis while still holding on to a full-time position
D) it is "no problem" to operate a new venture on a part-time basis while still holding on to a full-time position to make extra cash
E) None of the answers apply.

Accepted Answer

Operating a new venture typically requires significant time and effort, making it difficult to manage alongside a full-time job.

Question 13

The initial budget for the first year of operations should include which of the following expenditures?
A) capital expenditures
B) direct operating expenses
C) cash expenditures for non-expense items
D) All of the answers are correct.

Accepted Answer

The initial budget should account for all types of expenditures, including capital expenditures, direct operating expenses, and cash expenditures for non-expense items, to ensure comprehensive financial planning.

Question 14

The initial budget for the first year of operations should include which of the following sources of funds?
A) revenue from sales
B) owner's investment
C) funds from external investors
D) funds from external lenders
E) All of the answers are correct.

Accepted Answer

The initial budget for the first year of operations should consider all potential sources of funds, including revenue from sales, owner's investment, funds from external investors, and funds from external lenders.

Question 15

Benchmarks, industry norms, and financial ratios are typically used in preparing proforma financial statements for which of the following reasons?
A) They can provide reasonable assumptions regarding expenditures based on industry history and trends.
B) They take the guesswork out of estimating sales and expenses.
C) They are readily available for most industries.
D) They can be used as a basis for comparison with the entrepreneur's estimates.
E) All of the answers are correct.

Accepted Answer

Benchmarks, industry norms, and financial ratios help in making informed assumptions, reducing guesswork, are widely available, and serve as a comparison basis, making all options correct.

Question 16

In preparing the business plan, the Internet can be used as a source of information for which of the following?
A) industry analysis
B) competitor analysis
C) measurement of market potential
D) demographic information
E) All of the answers are correct.

Accepted Answer

The Internet is a valuable resource for gathering information on industry trends, competitor strategies, market potential, and demographic data, making all the options correct.

Question 17

The Internet can be used by entrepreneurs for which of the following reasons?
A) as a source of business intelligence for decision making
B) as part of their marketing strategy for communicating with customers
C) as a source of competitive intelligence
D) as a way of selling products or services to customers
E) All of the answers are correct.

Accepted Answer

The Internet serves multiple purposes for entrepreneurs, including gathering business and competitive intelligence, marketing, and selling products or services.

Question 18

Newsgroups on the Internet can be useful to an entrepreneur for which of the following reasons?
A) People who participate in newsgroups are potential customers who can provide marketing intelligence.
B) Staying current with general news is part of an environmental scanning initiative.
C) Entrepreneurs need unbiased support from many sources, including those found on the Internet.
D) Newsgroups tend to be more objective than commercially available marketing research information.
E) None of the answers apply.

Accepted Answer

Newsgroups can provide entrepreneurs with direct access to potential customers who can offer valuable insights and feedback, which can be used for marketing intelligence.

Question 19

When it comes to writing the business plan, many entrepreneurs are shocked or surprised to find out__________.
A) how quickly it comes together due to their enthusiasm and energy level
B) that more than one type or versions of the plan will be needed
C) how easily and cheaply the plan can be purchased online
D) that interested stakeholders encourage the use of different formats as it shows creativity
E) None of the answers apply.

Accepted Answer

Entrepreneurs often realize that they need different versions of a business plan for various stakeholders, such as investors, partners, or internal use, each with a different focus or level of detail.

Question 20

The primary difference between a business plan written for investors and the master business plan is__________.
A) the plan for potential investors is much longer than the master plan
B) the plan for potential investors focuses only on financial considerations
C) the master plan is more comprehensive in nature and therefore, much longer
D) the degree of optimism shown in the investor's plan
E) None of the answers apply.

Accepted Answer

The master plan is more comprehensive in nature and therefore, much longer.

Quiz 4: Creativity and the Business Idea

As discussed in the text, the first step in attempting to determine the market potential for a new venture is to __________.

When collecting market information the entrepreneur should attempt to __________.

When collecting market information to determine the market potential of the new venture, the entrepreneur should __________.

When collecting market information to determine the market potential of the new venture, general environmental trends of interest would include which of the following?

As discussed in the text, when collecting market information to determine the potential for the venture, the entrepreneur should first attempt to __________.

As discussed in the text, when collecting market information to determine the potential for the venture, the second task for the entrepreneur should be to __________.

As discussed in the text, when collecting market information to determine the potential for the venture, the third task for the entrepreneur should be to __________.

As discussed in the text, when collecting market information to determine the potential for the venture, the fourth task for the entrepreneur should be to __________.

The end result(s) of the four-step gathering market information process discussed in the text should be__________.

A feasibility study of the manufacturing operations for a new venture would include which of the following types of information?

A study that included information on the location, facility, equipment, processes, raw materials, labour skills, overhead expenses, and space for a new business venture would most likely to be which of the following?

The entrepreneur and his or her family must make a total commitment to the business in order to be able to meet the demands of a new venture.

The initial budget for the first year of operations should include which of the following expenditures?

The initial budget for the first year of operations should include which of the following sources of funds?

Benchmarks, industry norms, and financial ratios are typically used in preparing proforma financial statements for which of the following reasons?

In preparing the business plan, the Internet can be used as a source of information for which of the following?

The Internet can be used by entrepreneurs for which of the following reasons?

Newsgroups on the Internet can be useful to an entrepreneur for which of the following reasons?

When it comes to writing the business plan, many entrepreneurs are shocked or surprised to find out__________.

The primary difference between a business plan written for investors and the master business plan is__________.