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Exam 6: Entrepreneurship and Starting a Small Business

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Question 41

True/False

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A good business plan describes the nature of the proposed business,the target market,the competitive advantages,and the qualifications of the owners.

A) True
B) False

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Question 42

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Affiliate marketing is a web-based business strategy that:

A) relies on customers that enter the sites of large companies such as GAP™ and Nike™.
B) asks you to offer the names and emails of ten of your friends who may be interested in the products or services the web-site is selling.
C) is currently illegal,but difficult to stop.
D) Rewards individuals who are willing to link a company's website to their blog or social network page.

E) B) and D)
F) None of the above

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Question 43

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One advantage enjoyed by home-based businesses is the relative ease in attracting new customers.

One way to control the legal costs associated with operating a small business is to purchase a prepaid legal plan.

Studies show that seniority is the most important criteria when selecting employees for promotion to management positions.

For a business,catering to the needs of locavores:

Entrepreneurial teams increase the cooperation between marketing,production and other functional areas of a business venture.

A Small Business Investment Company (SBIC) is a(n) :

As a young boy,Drew remembers his grandfather telling him,"Son,if you can find something you like to do,and somebody is willing to pay you to do it,well,that's the secret to a great life." The way Drew saw it,this was his big break.For the past five years,he split his time between school and working for a local tree farm/nursery business.The owner recently announced he was ready to retire.As Drew began creating a business plan,he contemplated what the business might be worth? How much will he need to buy this business? For starters,Drew

Individuals desiring to learn about small business operations are advised to learn from other entrepreneurs.

A business's size is measured:

Which of the following statements is not a challenge for home-based businesses?

Entrepreneurs learn that there are many legal and financial issues involved in starting their business.The best way for the small business owner to resolve these issues and protect the firm's resources is:

Aside from personal savings,the only other viable source of financing for an entrepreneur would be funds available from friends and family.

Prospective entrepreneurs turned down by private lenders have little hope of getting financial help from the Small Business Administration,since the SBA's standards are even tougher than those of private lenders.

Mini-Case Peppy Roaney believes that pizza is a much more versatile dish than most people realize.As the national marketing manager for Pizza Guys,he observed how consumers were delighted with barbecue pizza,Hawaiian pizza,Mexican pizza and other unique combinations.His suggestions for other unusual pizzas,however,were met with a negative response by his superiors.Even some of his colleagues laughed at his ideas.Peppy's confidence in his ability to understand the market has led him to focus on planning a business of his own.Peppy realizes that he will take a risk when he leaves his job with Pizza Guys and embarks upon a new venture: Peppy's Pizzazzeria.Peppy is excited about the potential of profitably catering to the unmet desires of pizza consumers. -As a former classmate of Peppy's at the nearby university,you remind him what you both learned in your small business management class several years ago:

While Jing wants to start a small business,she has not yet uncovered an opportunity that would offer her security and the likelihood of high profits.Jing will likely find that one must risk more in order to attain high profits.

Mini-Case Peppy Roaney believes that pizza is a much more versatile dish than most people realize.As the national marketing manager for Pizza Guys,he observed how consumers were delighted with barbecue pizza,Hawaiian pizza,Mexican pizza and other unique combinations.His suggestions for other unusual pizzas,however,were met with a negative response by his superiors.Even some of his colleagues laughed at his ideas.Peppy's confidence in his ability to understand the market has led him to focus on planning a business of his own.Peppy realizes that he will take a risk when he leaves his job with Pizza Guys and embarks upon a new venture: Peppy's Pizzazzeria.Peppy is excited about the potential of profitably catering to the unmet desires of pizza consumers. -Given Peppy's willingness to accept the risks of opening and running Peppy's Pizzazzeria,he is clearly an example of a(n) :

Business plans are necessarily a bit vague since these are prepared prior to the beginning of business operations.

Which of the following is