Bus 101 5 & 6 – Flashcards

Which of the following BEST explains why small businesses can be so effective in fostering innovation?

Sites like Kickstarter and Indiegogo have popularized a type of start-up financing known as ________, in which entrepreneurs post a detailed explanation of their projects or businesses on the site and ask for financing.

A(n) ________ is defined as a business that is independently owned and operated and is not dominant in its field of operations.

Venture capitalists prefer to invest in innovative companies that have just begun operating.

A(n) ________ is a type of entrepreneur who prefers to keep his or her business small.

The ________ is an independent agency of the federal government that was formed to aid, counsel, assist, and protect the interests of small businesses.

Since Ben opened his own computer repair business, he has had to take a lot of time off to care for his mother who has been seriously ill. In his old job, he would not have been allowed to take so much time off. What advantage of owning a small business is BEST displayed by Ben's situation?

Which of the following is ALWAYS TRUE about the purchases of existing businesses?

A(n) ________ business is one that has at least 20 percent sales growth per year for five years, starting with a base revenue of at least $100,000.

What would be the GREATEST advantage of having a partner as opposed to having an advisory board?

Which of the following is NOT an advantage of buying an existing business?

Which of the following should a business owner create monthly?

Small businesses are important to the economy because they account for nearly 90 percent of America's gross domestic product.

If you are planning to start a new business, how long should you realistically expect it to take for your business to earn a profit?

Entrepreneurs may be motivated to succeed in order to take care of their families.

Isaac is a franchise owner of a fast food restaurant. When another franchisee is accused of using artificial meat in its hamburgers, sales at Isaac's franchise location drop dramatically. What disadvantage of franchising is BEST demonstrated by Isaac's situation?

A ________ is a formal document that states the goals of the business as well as the intended process for reaching those goals.

Maria is the owner of Pet Heaven, a new pet day care, grooming, and boarding business. Maria envisions her business expanding to five locations in her state within three years. To help her succeed, which of the following does Maria MOST need?

Which of the following statements is TRUE?

Amy is the founder of a small IT firm that specializes in social networking applications. She meets weekly with the members of her development team to solicit their ideas, address any problems they are having, and provide motivation and encouragement. Amy is demonstrating which characteristic of a successful entrepreneur?

Rashan has been working as a pharmacist at a large drug store chain. He would like to open his own small pharmacy but is not sure if he could be successful given the predominance of large competitors. What part of his business plan would best address his concern?

Regardless of how well or poorly a franchise business is doing, franchisees must give the franchisor a monthly ________

The major advantage of borrowing money from friends or family to start a business is ________.

Only 20 percent of small businesses survive after five years of operation.

Which of the following statements is TRUE about franchising?

Sam is eager to start a local magazine that will include articles about health and fitness and provide a place for local health and fitness professionals to advertise their services. Which of the following does he NOT need to include in his business plan?

An advantage of buying a franchise is that no initial training is necessary.

To qualify for Small Business Administration programs and benefits specifically targeted for small businesses, a business must generally have fewer than 20 employees.

Advisory boards generally do NOT have the authority to ________.

The Entrepreneurs Organization connects business owners with experts in their industries for individual mentoring.

Which of the following is the BEST example of entrepreneurial innovation?

Which of the following is NOT a disadvantage of franchising?

When a wealthy individual invests his or her own money into a business project or start-up company with little intention to influence decision making, he or she is MOST often called a(n) ________.

A system thinker is someone who focuses on the entire process of turning an idea into reality.

Franchisees are independent third-party operators who market and sell a company's products or services under the company's name.

A sole proprietor's income and expenses flow through ________.

In a large corporation, shareholder responsibilities include ________.

Which of the following methods do not-for-profit corporations primarily use to generate revenues?

A corporation is a specific form of business that is legally formed under state laws and is considered a separate entity.

Arthur is a truck driver who owns his own business. He has been on the road for several months, and the constant wear and tear on his truck results in the need for several major mechanical repairs. This generates a loss for his business. Which of the following reflects how this will affect Arthur's tax obligation?

It's important for partners to spell out the details of their partnership arrangements in writing because ________.

Limited liability companies are unable to offer stock options or stock bonus incentives to their employees because ________.

Owners of limited liability companies are referred to as ________, while owners of corporations are called ________.

The organizational structure of a corporation allows for shareholders to have control over the company's daily operations.

Leslie is excited to begin a personal shopping business. She is planning to have employees and is concerned about losing personal assets should something happen to the business. She would like to focus on profits and building a business but she does not want her business to pay its own taxes. What ownership structure is Leslie's best choice?

Which of the following types of ownership is limited to 100 owners?

Which of the following tasks is NOT the responsibility of the board of directors?

At a meeting to announce a merger with another company, which of the following buzzwords is a business leader MOST likely to use to justify the decision?

A sole proprietorship can have only one owner, but it can have any number of employees.

When establishing a sole proprietorship, it may be necessary to obtain local licensing or permits.

Traci and Sally have considered starting their own business but are concerned about the possibility of losing their personal assets if the business fails. One way for Traci and Sally to avoid this risk would be to organize their company as a ________.

In a sole proprietor ownership, if business assets are not enough to pay business debts, then personal assets, such as the sole proprietor's house, personal investments, and retirement plans can be used to pay the debt. This is called ________.

A disadvantage of a limited liability company is that it ________.

A proxy fight occurs when a company attempts to persuade the target company's shareholders to replace the existing management with one that is ________ the goals of the acquiring company.

Which of the following statements about the operation of a corporation is correct?