MGMT 3370 ch.6 Questions – Flashcards
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The pursuit of lucrative opportunities by enterprising individuals under conditions of uncertainty is known as:
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entrepreneurship
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The process by which enterprising individuals initiate, manage, and assume the risks and rewards associated with a business is known as a(n):
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entrepreneurial venture
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A business having fewer than 100 employees, independently owned and operated, not dominant in its field, and not characterized by many innovative practices is a(n):
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small business
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A(n) _____ is a new business having growth and high profitability as primary objectives.
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entrepreneurial venture
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While working at a software company, Ronald has created a new venture based solely on his idea while using his company's proprietary technology. Ronald can be described as a(n):
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intrapreneur
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_____ are new venture creators working inside big companies; they are corporate entrepreneurs, using their company's resources to build a profitable line of business based on a fresh new idea.
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intrapreneurs
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Your roommate wants to start a business and everybody has been giving her various kinds of advice about being an entrepreneur. Which of the following statements is true of entrepreneurship?
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Entrepreneurs take careful, calculated risks and are not afraid to act on those decisions
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Eddie was a manager at a company that produced household appliances. He had many innovative ideas to increase profit. However, his ideas were not received well by the company. So, he left the company to pursue his own business. His new business is known as a(n):
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entrepreneurial venture
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Laura recently started her own business. She has nearly recreated a company she worked for previously. But, she has great business acumen and has been able to run her business much more efficiently and profitably. Laura is a(n):
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entrepreneur
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When creating a new business one should start with:
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a great idea
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Laura, an enterprising individual, wants to open a store in her town. She wants her store to be of the same type as a popular coffee chain that is successfully operating in a city nearby. Laura wants to become a(n):
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franchisee
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In the context of successful business models for e-commerce, the _____ model involves charging fees to direct Internet website visitors to other companies' websites
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affiliate
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In the context of successful business models for e-commerce, the _____ model involves charging monthly or annual fees for Internet website visits or access to website content
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subscription
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eBay brings buyers and sellers together and charges a commission for each sale. This type of business model is known as a(n):
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intermediary model
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The side street effect refers to
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the appearance of unexpected opportunities as one follows a plan
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Entrepreneurs may be able to capitalize on _____ that refers to finding unexpected opportunities after heading down a road, even if their original idea does not work.
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the side street effect
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Which of the following characteristics helps an entrepreneur succeed?
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tolerance of risk, ambiguity, and uncertainty
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Cambridge Counseling, an entrepreneurial venture, does not have any distinctive services when compared with the well-established competitors in the field, and the business will require a sizable investment. Which quadrant of the entrepreneurial strategy matrix will the venture be placed?
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low innovation/high risk
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Most small business ventures are located in (the) _____ quadrant(s) of the entrepreneurial strategy matrix.
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lower right
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In the context of the entrepreneurial strategy matrix, a novel product idea that involves a large financial investment would be described as:
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high innovation/high risk
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In the context of the entrepreneurial strategy matrix, which of the following products is most likely to have the highest risks and returns?
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new pharmaceutical drug
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Which of the following is true of entrepreneurial ventures?
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successful companies do not always require a cutting-edge technology or an exciting new product
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Which of the following improves the odds of survival of a venture?
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revenues of $2-3million
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_____ are protected environments for new, small businesses offering low rents and shared costs.
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business incubators
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Which of the following is a benefit of business incubators?
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access to shared services
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In the context of common management challenges, leadership deteriorates into micromanagement when entrepreneurs fail to:
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delegate work
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The success of entrepreneurial venture is often jeopardized by the death of the founder. Which of the following is an important measure to minimize this problem?
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succession planning
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_____ offer a way for a business to raise capital through federally registered and underwritten sales of shares in the company.
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initial public stock offerings
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In order for family-managed businesses to survive and prosper, management guru Peter Drucker advised them to:
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fill at least one key position with a nonfamily member
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According to Peter Drucker, which of the following is true with respect to managing a family business?
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someone outside the family and the business should help plan succession
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Entrepreneurs, in part because they are very busy, often fail to use _____, resulting in inadequate margins to support growth.
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formal control systems
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In the context of starting an entrepreneurial venture, the first formal step is:
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conducting an opportunity analysis
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A description of the good or service, an assessment of the opportunity, an assessment of the entrepreneur, specification of activities and resources needed to translate the idea into a viable business, and the source(s) of capital together make up a(n):
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opportunity analysis
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Which of the following is the purpose of an opportunity analysis?
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To specify resources needed to translate the idea into a viable business
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A(n) _____ describes all the elements involved in starting a new venture.
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business plan
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Which of the following is a function of business plan?
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to ensure the success of the business
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Which of the following devotes too much attention to financial projections while neglecting other important information that is important to investors?
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business plan
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Which of the following key planning elements involves a competitive advantage that can be defended and should be focused on customer?
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opportunity
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People's judgment of a company's acceptance, appropriateness, and desirability, generally stemming from company goals and methods that are consistent with societal values is known as:
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legitimacy
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A competitive advantage from relationships with other people and the image other people have of the entrepreneur is known as:
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social capital
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As an organization grows, the successful entrepreneur will:
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develop an effective top management team
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The first step toward building organizational support for an idea that involves explaining the idea and seeking approval to look for wider support is known as:
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clearing the investments
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Guaranteeing the project's technical and political feasibility, often with a formal presentation to higher management, refers to which of the following stages for building support for an idea?
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getting the blessing
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"Loading the gun", or lining up ammunition in support of one's idea, is a phrase used by managers at General Electric that parallels which stage of building support for an idea?
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making cheerleaders
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Amanda, a manager, decides to offer her support to Jason, one of her subordinates, on a new project in exchange for a share of the payoffs. In the context of entrepreneurship, this practice is known as:
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horse trading
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Orlando works as a technician for a large manufacturer of biomedical equipment. Orlando has discovered a way to produce disposable products in large quantities that will be useful in research facilities. His employer has given Orlando and a selected team of researchers the resources to develop this idea. This project is referred to as:
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a skunkwork
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Informal efforts, as opposed to official job assignments, in which employees work to create new products and processes of their own choosing and initiative are known as:
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bootlegging
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Miguel works as a technician for a large manufacturer of biomedical equipment. He has discovered a technique to produce composite materials more efficiently. The company encourages its employees to pursue new ideas on company premises. Which of the following does Miguel's company support?
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bootlegging
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Successfully fostering and managing intrapreneurship involves
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rewarding risk taking
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The most dangerous risk in intrapreneurship is that of:
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over relying on a single large project
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The tendency of an organization to engage in activities designed to identify and capitalize successfully on opportunities to launch new ventures by entering new or established markets with new or existing goods or services is known as:
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entrepreneurial orientation
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Minute Clinic is an example of a business that was created as a result of:
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demographic changes
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The tourism industry at Mount Helens is an example of a business that was created as a result of:
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a calamity
