question

. A person who takes the risk of a business venture is

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an entrepreneur

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Major factors in a firm's success include

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having adequate capital, providing a product or service that meets customer needs, the owner's reason for starting the firm in the first place,

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Before starting a business, it is important to identify the kinds of entrepreneurial opportunities that match

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your aptitudes and interests

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Entrepreneurs try to meet the needs of the marketplace by supplying

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a product or service

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Entrepreneurs constantly change U.S. business and contribute to

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the nation's overall good

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Which of the following is not a characteristic of a successful entrepreneur?

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Dependence

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To decide whether or not a business opportunity is realistic for you, compare your background and experience with

answer

the experience of people who own that kind of business

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You can find out about business opportunities from

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books and magazines,government publications, the SBA

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The SBA

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publishes information that may be helpful for small businesses

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The best entrepreneurs use

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a formal problem-solving model to make decisions

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The problem-solving process is not complete until

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the action is evaluated

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Good communication is important in the problem-solving process because to solve problems, you will likely need to

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interact with others, request information and express your ideas, listen to suggestions from others

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The role of business is

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to produce and distribute goods and services that people need and want

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Raw materials supplied by nature are called

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natural resources

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What would not be considered a capital resource

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Employees

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A marketing mix is

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a combination of product, distribution, price, and promotion

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The U.S. economic system is not based on

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government control

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components of the marketing mix do not include

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competition

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When the quantity of a good or service produced increases

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variable costs increase as well

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. The fixed costs of a business

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include monthly rent

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Writing a business plan can help you identify

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problems you might encounter in the future

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A business plan should

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identify target customers, show how your business will earn a profit, detail who will run your business

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A business plan explains how your product or service

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will be produced, will be sold, is either new or better than existing products or services

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Writing a business plan can force entrepreneurs to think

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about their goals

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The marketing section of your business plan should describe

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the location of your business

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The marketing section of your plan explains

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how you plan to enter the market, who your prospective customers are, your advantages over the competition

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A local Chamber of Commerce can provide

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information on trends affecting local businesses, local resources, and zoning and licensing information

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. Your business plan must

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clearly define your market, never overlook the competition, be consistent

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Entrepreneurs estimate demand for their products and services by identifying

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their target market

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. Understanding your customers allows you

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to meet customer demands

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. Psychographics are data that describe a group of people in terms of their

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lifestyle habits, personality traits, opinions

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Secondary data are found in

answer

already published sources

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Secondary data are found

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in government publications, on the Internet, in newspapers

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Customer relationship management

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focuses on understanding customers as individuals

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To convince customers to buy from you instead of your competition, you need

answer

need information about your competitors

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Your analysis of competitors should include

answer

their prices, locations, and facilities

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Competitive analysis does not

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) research a competitor's business plan

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A marketing mix is the blending of

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product, distribution, price, and promotion to satisfy a target market

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Price is one of the elements of

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the marketing mix

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Your marketing strategy should address

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product introduction or innovation, pricing, market share

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The marketing concept is the belief that

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the wants and needs of customers are the most important consideration when developing any product or marketing effort

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Branding is

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the name, symbol, or design used to identify your product

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Companies that use the marketing concept will

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select a product mix that will most appeal to their target customers

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Businesses can increase market share by

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networking with potential customers

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If the terms of an invoice read "2/10, net 30," this means that

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a 2 percent discount may be taken if the invoice is paid within 10 days

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Direct distribution channels move products

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directly from the manufacturer to the consumer

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Physical distribution does not include

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branding

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Direct-mail advertising is

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effective only if people read it

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In choosing an advertising medium, you should

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consider its effectiveness in reaching your target market

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Publicity is free promotion that

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is generated by media coverage, may involve staging an event or bringing in a celebrity, may be favorable or unfavorable

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Personal selling is

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direct communication between a prospective buyer and a sales representative in which the sales representative attempts to influence the prospective buyer in a purchase situation

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When customers know exactly what they want, the fulfillment of their needs is referred to as

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need satisfying

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The first step in the consumer decision-making process is to

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define the problem

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A disadvantage of buying an existing business is that it may

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be poorly located

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. When buying a business, you should not expect to be able to

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inspect a list of all customers

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You should be suspicious when buying a franchise if the franchisor refuses to provide

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written financial statements

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A partnership agreement should include

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a procedure for dealing with the death of a partner

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how dividends are to be distributed

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is not included in a partnership agreement

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During the period a patent is in effect

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no business or individual can copy or use the patented invention without permission from the patent holder

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Laws that protect businesses involve

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trademarks

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Restrictions on where businesses can locate are

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zoning laws

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In choosing location you should be able to

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identify your trade area on a map

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An advantage of working at home is that

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many costs are reduced or eliminated

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E-commerce consists of

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buying and selling over the Internet

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In a percentage lease

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the tenant pays a base rent and a portion of their profits to the landlord

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A lease in which the landlord pays all property expenses is a

answer

) gross lease

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A lease in which the landlord receives a portion of the tenant's revenue each month in addition to rent is a

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percentage lease

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. Inventory consists of

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the products and materials needed to make the product

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Vendors are

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companies that sell products and services to businesses

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A______________ business does not always need inventory before it can open for business

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Service business

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Net worth

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is the difference between what you owe and what you own

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Things that you own are called

answer

assets

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. A bank may turn down a loan application for a new business because the entrepreneur

answer

is investing too little personal money in the business

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The cost of the inventory a business sells during a particular period is called

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cost of goods sold

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Loans and accounts payable are examples of

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liabilities

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. In the accounting equation, assets must always equal

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liabilities plus owner's equity

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You should balance your check register every

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month

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If you have a personal checking account, you

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should still get a separate business account

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A payroll register does not include

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sales taxes deducted from an employee's earnings

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Instruction in safety procedures should be part of

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employee training

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Business rules, policies, and procedures should be included

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in your operations manual

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. If inventory is held too long it may become

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obsolete

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The level of inventory you keep in stock depends on

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the frequency with which you sell your inventory, the cost of carrying inventory, the cost of losing a sale because you are out of stock

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A cash budget is

answer

based on past revenues and will show the projection of incoming cash

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. Reducing your payroll expenses by laying off workers can

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improve your cash flow

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All of the information necessary for calculating net profit on sales is found on the

answer

income statement

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The people who work for your business are your

answer

human resources

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To determine your staffing needs

answer

make a list of all the duties in your business and the time needed to perform each

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A want ad should not

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ask applicants to identify their race and religion

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It is important to make the most of the job interview because you want to hire employees who can

answer

improve your ability to meet customer needs

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When checking references, you should ask previous employers about a candidate's

answer

personal qualities

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Rewards, other than cash are called

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benefits

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During a job interview, you should

answer

allow the applicant plenty of time to talk

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Effective managers need good

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leadership qualities

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Employee training should

answer

begin as soon as the employee is hired, be evaluated to ensure it was effective, be continuous

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You should evaluate employee performance

answer

to help you identify both outstanding and problem employees

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You should let your managers and employees know about your plan for

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handling risks

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A recovery plan is an important part of every

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risk management plan

question

You transfer risk and protect yourself against financial losses from some risks by

answer

purchasing insurance

question

A payment made to an insurance company to cover the cost of insurance is a

answer

premium

question

life insurance.

answer

is not the most important type of insurance you will need for your business

question

Property insurance usually does not cover losses due to

answer

floods

question

An installment loan is

answer

paid back with interest in monthly equal amounts over a specified period of time

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It is the employee's, not the employer's, responsibility to file

answer

a workers' compensation claim.

question

Uncollectible accounts

answer

are an expense to a business

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