Test bank for entrepreneurial small business 3rd edition by katz

The BRIE model can help individuals with one of the biggest hurdles of starting a business, which are resources... According to the text, small business involves _____ people and has its

Chapter 01 Small Business: Its Opportunities and Rewards

True / False Questions

1 About half of the adults in the U.S think about owning their own business, but only one person in 50 who thinks about it actually starts a business

8 Nearly all entrepreneurs talk about three universally mentioned rewards: flexibility, fame, and fortune

15 In the BRIE model, exchange refers to moving resources, products, or services to others inexchange for money or other resources

True False

16 The BRIE model can help individuals with one of the biggest hurdles of starting a

business, which are resources

21 According to the text, small business involves _ people and has its owner managing the business on a day-to-day basis

A Moving from inaction to action and taking the right action

B Financing the business and government regulation

C Experience from large corporations for needed skill sets and organization abilities

D Family support and finding the right people for the organization

23 According to the Small Business Administration, about _ of new firms with

employees survive four years, and for owner-only firms this rate is _ percent surviving four years

26 _ are the offices co-sponsored by states and the federal government, that offer free or low-cost help to existing and potential small businesses

A Small Business Development Centers

B Small Business Administration Offices

C Research and Outreach Services

D Occupational structures

27 The U.S government agency that helps people start business is the

A Small Business Administration

B U.S Department of Business Development

C Department of Business Development

D U.S Entrepreneurial Administration

28 The Small Business Administration categorizes a business in the U.S as small, if it has fewer than _ employees

31 _ refers to constant or at least daily management of a business by its owner

C described as being unique and distinctive

D prepackaged businesses you buy or lease from a franchisor

35 A prepackaged business bought, rented, or leased from a company is called a(n)

A incubator

B imitative firm

C franchise

D novelty

36 A person who becomes an owner through inheriting or being given a stake in a family business is called a(n)

A founder

B manager

C heir

D buyer

37 People starting high-growth ventures

A require key market knowledge that focuses on their immediate marketplace and

communities

B focus on how to start small, with resources from the owner, family, and friends

C need to know how to seek and obtain external financing

D require a key type of knowledge of how to grow on the schedule set by and for the

purposes of the owner

38 The key market knowledge for a small business

A is to know how to seek and obtain external financing

B focuses on its immediate marketplace and communities

C is to know how to cash out through the sale of an initial public offering of stock or through the sale of the company to a larger company

D focuses on the need to know how to dominate the market and grow dramatically and quickly

39 Which of the following is a characteristic of a small business?

A Preferred funding source is other people's money

B Focus is on efficiency

C Approach to human resource is to professionalize

D Delegation is essential

40 Which of the following is an attribute of a high-growth venture?

A When the firm is in trouble, it cuts costs

B Metastrategy is novelty

C High-growth ventures grow when necessary

D Delegation is difficult

41 Identify the characteristic of a small business

A When the firm is in trouble, it focuses on selling more products/services

B Approach to human resources is to professionalize

C Focus is on effectiveness

D Metastrategy is imitation

42 Identify the characteristic of a high-tech venture

A Owner's own money is the preferred funding source

B Focus is on efficiency

C Delegation is essential

D Sales are more important than marketing

43 Which of the following refers to the eventual size of the market, which can range from a small, local, or niche market to something used by millions or even billions?

A Dynamic Capitalism Typology

B General Equilibrium Economics

C Creative destruction

D PICS Model of Entrepreneurship

45 Identify the most numerous and widely available type of firm, ranging from low to moderate levels of innovation and growth

A Resource constrained sector

B Ambitious firm sector

C Glamorous sector

D Economic core sector

46 Why are small businesses considered the economic core of society?

A They are high growth and high innovation firms

B They are made up of franchises and multisite firms, who are generally not very innovative, but are designed for high levels of growth

C They have lots of innovative ideas but lack the funds to bring them to market

D They are the most numerous and most widely available type of firms

47 According to the Dynamic Capitalism Typology, the glamorous sector

A consists of firms with high growth and high innovation

B consists of the most numerous and most widely available type of firms

C consists of franchises and multisite firms, with low to moderate innovation and high levels

of growth

D consists of firms high in innovation but low in growth rate due to a lack of resources

48 Which of the following is an example of the glamorous sector?

A Inventors

B Fortune 500s

C Small businesses

D Franchises and multisite firms

49 All of the following relate to firms in the ambitious firm sector EXCEPT

A they are mostly franchises and multisite firms

B they are characterized by low to moderate innovation

C they are made up of inventors and research and development firms

D they are designed for high levels of growth

50 The resource constrained sector

A are firms that have low to moderate levels of innovation and growth

B are high growth and high innovation firms

C are firms that have lots of innovative ideas but lack the funds to bring them to market

D are generally not very innovative, but are designed for high levels of growth

51 All of the following are the popular reward types for small business owners EXCEPT

A flexibility

B power

C income

D growth

52 Which of the following is a reward that is rarely mentioned by entrepreneurs?

A Building great wealth

56 The ability of business owners to structure life in the way that suits their needs best refers

57 Which of the following is NOT a myth about small businesses?

A There is not enough financing to start businesses

B You need to make something if you are going to make money

C You can never try again if you fail once

D There is no flexibility when you own your own business

58 Funding invested for a share of a firm or given as loans or credit from family, friends, and other businesses used to help start or grow a firm is known as

A committed capital

B informal capital

C mezzanine capital

D formal social capital

59 According to Sageworks, in 2008, amid a recession, which of the following represented the most profitable industries for small businesses?

A Manufacturing industries

B Financial services

C Service industries

D Software industries

60 According to the BRIE model, in order to start a business, you need all of these elements

to come together EXCEPT

A boundary

B resources

C intention

D experience

61 Which factor distinguishes a firm from the process of buying or selling or bartering we all

A include a business name or government registration

B refer to moving goods or service to others in exchange for money

C are the most frequently occurring element of the BRIE model

D include the product or service to be offered

64 Which is the most frequently occurring element of the BRIE model?

66 The BRIE model can help an individual deal with one of the biggest hurdles in starting a business, which is

70 Mandarin is a restaurant which has opened recently People from all over town flock to Mandarin to find out how good it is This gives a big boost to the restaurant's initial business But it causes the other restaurants in the area to lose business temporarily The way in which Mandarin hurts existing restaurants is an example of

74 Innovation-driven economies

A are those where entrepreneurship becomes a key way to build the middle class

B are nations where industrialization is becoming the major force providing jobs, revenues and taxes

C are focused on high-value-added manufacturing but are marked by a very large service sector

D are those where entrepreneurship is essential to helping build personal wealth and break the cycle of low-wage jobs

75 Entrepreneurship levels in countries such as Germany, Israel, the Republic of Korea, and the United States average the lowest of the

C The VIGE approach produces large numbers of smaller-scale exporters

D VIGE sites replace institutional procedures with personal contacts to help even the smallestsmall businesses go global

77 Which aspect of entrepreneurship refers to being in-tune with one's market?

A Efficiency

B Creation

C Customer-focus

D Growth

78 The form of entrepreneurship in which a person or group own their own for-profit business is

82 Identify the type of entrepreneurship which concentrates typically on innovation and customer-focus

A Public entrepreneurship

B Corporate entrepreneurship

C Independent entrepreneurship

D Social entrepreneurship

83 Which of the following best describes a corporate form of entrepreneurship?

A It is a form of entrepreneurship involving the creation of self-sustaining charitable and civic organizations

B It is a form of entrepreneurship that involves revitalizing government agencies

C It is a form of entrepreneurship in which a person or group owns their own for-profit business

D It is a form of entrepreneurship which takes place in existing businesses around new products, services or markets

84 Social entrepreneurship

A involves creating new charitable and civic organizations which are financially sufficient

self-B involves bringing new products or services to market

C involves a person or group who owns their own for-profit business

D involves revitalizing government agencies

85 This is the degree of attention your target market pays to your idea or organization

A Efficiency

B Identity

C Mindshare

D Growth

Scenario: Jamie Johnson and "For Kidz"

Taking classes at a local university, Jamie heard a consistent theme from many professors, students, and parents in the community: "There is nothing for children in this rural area." Jamie always liked children and thought of starting a business "For Kidz" targeting children

12 and under

86 Where can Jamie go to get some help with his business idea?

A Small Business Development Center

B U.S Department of Commerce office

C Incubator

D Small Business Administration Center

87 If Jamie gets "For Kidz" up and running, he could be described as all of the following EXCEPT

A Its focus should be on effectiveness

B The approach to human resources should be to professionalize

C Metastrategy should be imitation

D It should grow when possible

89 Jamie should be aware that all of the following are myths about a small business EXCEPT

A there is not enough financing to start businesses

B you need to make something if you are going to make money

C you can never try again if you fail

D the biggest hurdle facing an individual considering a business opportunity is inaction

90 In order to start "For Kidz" successfully, Jamie needs all of the following elements to come together EXCEPT

A boundary

B recruitment

C intention

D exchange

Essay Questions

91 Define small business Differentiate between small businesses and high-growth ventures

92 Briefly describe the three universally mentioned and four rarely mentioned rewards

93 What are the most common myths about small businesses? What are the realities?

Explain

94 Briefly describe the BRIE model

95 What roles do small businesses play in new jobs? Explain

96 What is creative destruction? Explain with an example

97 What is a factor-driven economy?

98 What is VIGE? Explain

99 What are the different aspects of entrepreneurship according to the PICS Model of Entrepreneurship?

100 What are the four forms of entrepreneurship in the PICS Model of Entrepreneurship? Explain

Chapter 01 Small Business: Its Opportunities and Rewards Answer Key

True / False Questions

1. (p 4) About half of the adults in the U.S think about owning their own business, but only one person in 50 who thinks about it actually starts a business

2. (p 4) When thinking about owning their own business, one hurdle people need to overcome

is taking the right action

4. (p 6) Imitative firms are defined as prepackaged businesses that are bought, rented, or leased from another company

8. (p 8) Nearly all entrepreneurs talk about three universally mentioned rewards: flexibility, fame, and fortune

12. (p 10) Some of the problems faced by people who are thinking about starting small businesses are: (1) there is not enough financing to start businesses, and (2) they must make something to make money

16. (p 14) The BRIE model can help individuals with one of the biggest hurdles of starting a business, which are resources

20. (p 20) Public entrepreneurship is the form of entrepreneurship that involves revitalizing private agencies

Multiple Choice Questions

21. (p 4) According to the text, small business involves _ people and has its owner

managing the business on a day-to-day basis

A Moving from inaction to action and taking the right action.

B Financing the business and government regulation

C Experience from large corporations for needed skill sets and organization abilities

D Family support and finding the right people for the organization

There are two hurdles that people need to overcome to move from thinking to achieving One

of these is moving from inaction to action The second hurdle is taking the right actions

AACSB: Analytic

Bloom's: Knowledge

23. (p 5) According to the Small Business Administration, about _ of new firms with employees survive four years, and for owner-only firms this rate is _ percent surviving four years

AACSB: Analytic

Bloom's: Knowledge

Difficulty: Easy

Learning Objective: 01-1

25. (p 5) What percent of firms getting help in incubators were still going at four years?

A Small Business Development Centers

B Small Business Administration Offices

C Research and Outreach Services

D Occupational structures

More than 81 percent of the clients of Small Business Development Centers were still going after five years, and 87 percent of firms getting help in incubators were still going at four years

AACSB: Analytic

Bloom's: Knowledge

Difficulty: Medium

Learning Objective: 01-1

27. (p 5) The U.S government agency that helps people start business is the

A Small Business Administration.

B U.S Department of Business Development

C Department of Business Development

D U.S Entrepreneurial Administration

The Small Business Administration or SBA categorizes a business in the United States as small if it has fewer than 500 employees

AACSB: Analytic

Bloom's: Knowledge

Difficulty: Medium

Learning Objective: 01-1

29. (p 5) Among SMEs, medium enterprises have _ people

D independent small business.

Independent means that the business is owned by an individual or small group rather than existing as part of a larger enterprise or a business whose stock can be bought on an exchange

AACSB: Analytic

Bloom's: Knowledge

Difficulty: Easy

Learning Objective: 01-1

31. (p 5) _ refers to constant or at least daily management of a business by its owner

33. (p 6) Truly entrepreneurial businesses are characterized by _, in their products, services, or business models

C described as being unique and distinctive

D prepackaged businesses you buy or lease from a franchisor

Small businesses are imitative in nature, with most small firms doing what other firms do, with only slight variations

AACSB: Reflective Thinking