ENT4014 Quiz 1 and 2 Flashcards

question

Google is an established firm that encourages and emphasizes entrepreneurial behavior throughout its various divisions. According the the textbook, Google practices ______ entrepreneurship.
answer

corporate
question

According to the textbook, the number one reason that people become entrepreneurs is to:
answer

be their own boss
question

According to the textbook, entrepreneurs are ______ risk takers.
answer

moderate
question

Entrepreneurship is the process by which individuals pursue opportunities within the constraints of the resources they control.
answer

false
question

The number one characteristic shared by successful entrepreneurs is passion for their business.
answer

true
question

A(n) _________ is a favorable set of circumstances that creates a need for a new product, service, or business.
answer

opportunity
question

Which of the following is not an example of a social force?
answer

changes in interest rates
question

The ability to notice things without engaging in deliberate search is referred to as:
answer

entrepreneurial alertness
question

Studies have shown that prior experience in an industry helps entrepreneurs recognize business opportunities.
answer

true
question

The three ways to identify an opportunity include observing trends, solving a problem, and finding gaps in the marketplace.
answer

true
question

________ is the process of determining whether a business idea is viable.
answer

Feasibility analysis
question

Which of the following is not an attribute of an attractive industry?
answer

is late rather than early in its life cycle
question

Which of the following is not one of the four areas of feasibility analysis discussed in the textbook?
answer

Societal feasibility
question

The proper sequence for developing successful business ideas is to first conduct a feasibility analysis, then progress through the opportunity recognition stage, and finish with the completion of a business plan.
answer

true
question

Jennifer is thinking about starting a firm in the upscale women’s fashion industry. To get a full appreciation of the competitive nature of the industry, and how she might position her products, Jennifer has spent considerable time looking at industry-related publications and ABI-Inform, which is a database that provides access to articles covering a wide-variety of business and industry related issues. Jennifer is conducting ________ research.
answer

secondary
question

Which of the following is the main purpose for writing a business plan?
answer

The plan helps the company develop a “road map”, or blueprint to follow; and, the plan introduces potential investors and other stakeholders to the business opportunity.
question

There are two primary audiences for a business plan:
answer

a firm’s employees, and investors and other external stakeholders
question

Which of the following statements is incorrect regarding business plans?
answer

INCORRECT:To make the best impression, a business plan should follow an unconventional structure, so it will stand out. A business plan has both an external and internal audience. A company’s business plan is typically written by its founders. Potential investors are typically keenly interested in a company’s business plan.
question

Full business plans prepared for investors are typically 60-80 pages long.
answer

False
question

Fragmented industries are more receptive to new entrants than industries that are dominated by a handful of large firms.
answer

true
question

A(n) _____ is a group of firms producing a similar product or service, such as soft drinks, electronic games, or computers.
answer

industry
question

Industries that sell products to seniors, such as the eyeglass industry and hearing aid industry, are benefiting from the aging of the population, which is an important:
answer

environmental trend
question

John is thinking about starting a firm in the specialty chemical industry. In the industry analysis John has been conducting, one thing he has noticed is that the specialty chemical industry is characterized by the following factors: high supplier concentration, high switching costs for buyers when they switch from one supplier to another, and no attractive substitutes for the products that most of the suppliers provide. These factors concern John because they tell him that the profitability of the specialty chemical industry is suppressed by the:
answer

bargaining power of suppliers
question

Shelly recently launched a firm in the fruit drink industry, and has already exported her fruit drinks to 9 different countries. One thing Shelly’s firm is doing is that it is varying the tastes of the fruit drinks it sells on a country by country basis to meet the demands of the local markets. Shelly’s firm is pursuing a __________ strategy.
answer

multidomestic
question

The best industry to enter is an industry where the threat of each of Porter’s five-forces is low.
answer

true
question

In regard to business models, which of the following statements is incorrect?
answer

There is a standard business model that most firms will follow.
question

The _______ is the string of activities that moves a product from the raw material stage, through manufacturing and distribution, and ultimately to the end user.
answer

value chain
question

Kendra is starting a firm in the shoe industry. Her shoes will be very high quality and will be priced at the top end of the market. Kendra has chosen the generic strategy referred to as:
answer

differentiation
question

Jared is starting a firm in the electronic games industry. The firm will produce games similar to popular games on the market, but they won’t be as sophisticated and will be priced at the low end of the market. Jared has chosen the generic strategy referred to as:
answer

cost leadership
question

Historically, it has been difficult for a new venture to use a differentiation strategy.
answer

false
question

Which of the following is the most important thing that an entrepreneur, or team of entrepreneurs, can do to build a strong ethical culture in their organization?
answer

lead by example
question

A(n) _______ is a written document that deals with issues such as the relative split of the equity among the founders of the firm, how individual founders will be compensated for the cash or the “sweat equity” they put into the firm, and how long the founder will have to remain with the firm for their shares to fully vest.
answer

founders’ agreement
question

Which of the following is a disadvantage of a C Corporation?
answer

Income is subject to double taxation
question

A disadvantage of a sole proprietorship is that it is subject to double taxation.
answer

false
question

The major difference between a general partnership and a limited partnership is that a limited partnership includes two classes of owners: general partners and limited partners.
answer

true
question

Which of the following was not identified as one of the four main financial objectives of a firm?
answer

Timeliness
question

Which financial statement records all of a firms revenues and expenses for a given period and shows whether the firm is making a profit or experiencing a loss?
answer

Income Statement
question

Kevin was reading the business plan of New Venture Fitness Drinks, and noticed that prior to its financial forecasts, New Venture Fitness Drinks placed an explanation of the sources of the numbers for the forecast and the assumptions used to generate them. This explanation is called a(n) _______.
answer

Assumption Sheet
question

Financial management deals with two things: raising money and managing a company’s finances in a way that achieves the highest rate of return.
answer

true
question

A statement of cash flows is a snapshot of a company’s assets, liabilities, and owners’ equity at a specific point in time.
answer

false
question

Gillian is in the process of launching an educational services firm. She plans to incorporate the firm. Because the firm will be a corporation, Gillian is legally required to have a ______.
answer

board of directors
question

A(n) __________ is a panel of experts who are asked by a firm’s managers to provide counsel and advice on an ongoing basis.
answer

advisory board
question

Which of the following statements about advisory boards is incorrect?
answer

Similar to a board of directors, an advisory board has legal responsibility for the firm in certain areas.
question

A new venture team is the group of founders, key employees, and advisers that move a new venture from an idea to a fully functioning firm.
answer

true
question

Founding teams that have worked together before, as opposed to teams that are working together for the first time, have an edge.
answer

true
question

Jason’s startup, which is in the electronics industry, was launched January 1, 2009. However, prior to its formal launch, Jason spent many hours working on his business, particularly during the feasibility analysis stage. The value of the time and effort that a founder puts into a new venture is referred to as _________.
answer

sweat equity
question

Lucas just opened a soup and salad restaurant. Rather than borrow money or raise funds from investors, Lucas used his creativity and ingenuity and figured out how to get his business up and running without the need for external funding. Lucas is utilizing a technique referred to as _______.
answer

bootstrapping
question

Which of the following is not a source of equity funding?
answer

Government grants
question

There are three reasons that most entrepreneurial ventures need to raise money during their early life: cash flow challenges, capital investments, and lengthy product development cycles.
answer

true
question

Typically, the seed money that gets a company started comes from a commercial bank.
answer

false
question

The first step in selecting a target market is to study the industry in which the firm intends to compete and determine the different potential target markets in that industry. This process is called __________.
answer

market segmentation
question

Once a firm has segmented the market, the next step is to ____________.
answer

select a target market
question

A(n) ______ is the set of attributes – positive or negative – that people associate with a company.
answer

brand
question

A firm’s marketing mix is the assortment of products and services it sells.
answer

false
question

Many startups emphasize advertising over public relations primarily because advertising is cheaper and helps build the firm’s credibility.
answer

false
question

Which of the following is an example of intellectual property?
answer

Nike’s swoosh logo
question

There are two primary rules of thumb for deciding if intellectual property protection should be pursued for a particular intellectual asset. First, a firm should determine if the intellectual property in question is directly related to its competitive advantage. Second, a firm should determine if its intellectual property _____________.
answer

has value in the marketplace
question

Which of the following are the four key forms of intellectual property protection?
answer

Patents, trademarks, copyrights, and trade secrets
question

Utility patents are the most common type of patent and cover what we generally think of as new inventions.
answer

true
question

Computer software is not covered by copyright law.
answer

false

Get instant access to
all materials

Become a Member