Question 1

An opportunity assessment plan:

Accepted Answer

An opportunity assessment plan focuses on evaluating the potential of a business opportunity, rather than outlining the details of a specific venture, as is done in a business plan. It may include market research, competitive analysis, and financial projections, but the main goal is to assess the feasibility and potential of the opportunity itself. It may be shorter than a business plan and may not include a comprehensive financial statement.

Question 2

A nonequity arrangement is a method by which an entrepreneur can enter a market and obtain sales and profits without direct equity investment in the foreign market.

Accepted Answer

A nonequity arrangement allows an entrepreneur to gain access to a foreign market without making direct equity investments. This can be done through various strategies such as licensing, franchising, or contract manufacturing.

Question 3

When researching foreign markets,the entrepreneur will usually want data such as population,GDP,per capita income,inflation rate,literacy rate,unemployment,and education levels.

Accepted Answer

This statement is true. When expanding a business into a foreign market, the entrepreneur will want to gather data on various economic and social indicators in order to assess the potential success and viability of the business in that market. The data points listed (population, GDP, per capita income, inflation rate, literacy rate, unemployment, and education levels) are all examples of key indicators that can inform the entrepreneur's decision-making.

Question 4

For a U.S.-based entrepreneurial firm,the 75 percent of the world's population living outside the United States offers a very large market opportunity.

Accepted Answer

The answer of For a U.S.-based entrepreneurial firm,the 75 percent...

Question 5

A product extension merger occurs when acquiring and acquired companies have related production and/or distribution activities but do not have products that compete directly with each other.

Accepted Answer

A product extension merger occurs when the acquiring and acquired companies have related production and/or distribution activities but do not have products that compete directly with each other. This allows the merged company to expand its product line and reach a wider market without cannibalizing its own sales.

Question 6

A disadvantage of using licensing as an entry strategy for a foreign market is the high amount of risk involved.

Accepted Answer

Licensing typically involves lower risk compared to other entry strategies like direct investment, as it requires less financial commitment and exposes the company to less legal and financial vulnerabilities in the foreign market.

Question 7

The General Agreement on Tariffs and Trade is an attempt to impose significant tariffs on business between nations.

Accepted Answer

The General Agreement on Tariffs and Trade (GATT) was actually an international agreement that aimed to reduce tariffs and other barriers to international trade. It was created in 1947 and eventually led to the formation of the World Trade Organization (WTO) in 1995. Therefore, it was not an attempt to impose significant tariffs, but rather to promote free and open trade between nations.

Question 8

All of the following statements concerning opportunity assessment plans are correct except:

Accepted Answer

The first major section of the opportunity assessment plan does not typically involve developing a timeline for launching the venture; this is more characteristic of a business plan.

Question 9

In selecting a foreign market,two critical issues for the entrepreneur are foreign market selection and market entry strategy.

Accepted Answer

Selecting the right foreign market is important for the success of the business, and deciding on the appropriate market entry strategy is equally crucial. Both of these are critical issues for entrepreneurs when expanding into international markets.

Question 10

Reference groups in any culture provide values and attitudes that influence behavior.

Accepted Answer

Reference groups are social groups that an individual uses as a point of reference for their behaviors, attitudes, values, and beliefs. They play an important role in shaping cultural norms and influencing the behavior of individuals. Therefore, it is true that reference groups in any culture provide values and attitudes that influence behavior.

Question 11

Gifts related to business proceedings are illegal in most other countries and should not be offered to foreign business partners.

Accepted Answer

While the legality and appropriateness of giving gifts in a business context vary significantly from country to country, it is not true that such gifts are illegal in most countries. Many cultures consider gift-giving an important part of business etiquette, though there are often specific rules and limits to prevent bribery and corruption.

Question 12

________ is a nonprofit organization that provides free online and in-person assistance to entrepreneurs in the form of training,consulting and mentoring provided mainly by retired executives and entrepreneurs.

Accepted Answer

SCORE is a nonprofit organization that offers free services to entrepreneurs, including training, consulting, and mentoring. The organization is mainly operated by retired executives and entrepreneurs who offer advice on various business aspects.

Question 13

The objectives of the General Agreement on Tariffs and Trade was to liberalize trade by eliminating or reducing tariffs.

Accepted Answer

The primary objective of the General Agreement on Tariffs and Trade (GATT) was to promote free and fair trade by reducing or eliminating tariffs and other barriers to trade among member countries.

Question 14

Nonequity arrangements discussed by the text include licensing,management projects and exporting.

Accepted Answer

The answer of Nonequity arrangements discussed by the text include...

Question 15

________ provides information on industries such as aerospace,energy,healthcare and defense.

Accepted Answer

Frost and Sullivan is a leading research and consulting firm that provides insights on various industries including aerospace, energy, healthcare, and defense. They offer market research reports, analysis, and strategic recommendations to help businesses make informed decisions. The other options provided do not specialize in industry-specific research and analysis.

Question 16

There are three general classifications for exporting; direct,indirect and third-party.

Accepted Answer

There are generally two main classifications for exporting: direct and indirect. Third-party is not a standard classification.

Question 17

________ are both government sources of information that might be helpful in gathering the information needed to start a business.

Accepted Answer

NAICS (North American Industry Classification System) and SIC (Standard Industrial Classification) codes are government sources of information that classify business establishments by their type of activity for data collection purposes. They can be helpful in identifying industry trends and potential competitors in the market.

Question 18

Profits and tax benefits are common motivations for going global.

Accepted Answer

Profits and tax benefits are two major reasons why businesses expand their operations globally.

Question 19

A vertical merger is the combination of two firms that produce one or more of the same or closely related products in the same geographical area.

Accepted Answer

This is actually the definition of a horizontal merger. A vertical merger is the combination of two firms in different stages of the production process – for example, a car manufacturer merging with a parts supplier.

Question 20

The North American Free Trade Agreement (NAFTA)increases trade barriers and quotas among the United States,Canada,and Mexico.

Accepted Answer

This statement is false. NAFTA is designed to decrease trade barriers and promote free trade among the three countries by eliminating tariffs and other restrictions on goods and services traded between them.

Quiz 5: Identifying and Analyzing Domestic and International Opportunities