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Exam 6: Entrepreneurship and Starting a Small Business

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Question 21

Multiple Choice

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Bankers and potential investors are likely to read ___________ first.

A) the executive summary
B) the marketing plan
C) the qualifications of the management team
D) the analysis of the competition

E) A) and B)
F) A) and C)

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Question 22

True/False

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Attracting qualified workers presents a problem for small businesses since they usually offer less money,fewer benefits,and less room for advancement than larger firms offer.

A) True
B) False

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Question 23

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Justin feels that his family-run business will be more likely to avoid the problems many growing businesses have with managing employees.His attitude will likely hinder the growth of his company.

Economist Bruce Kirchhoff contends that business failures are much lower than traditionally reported.

Dr.Smiley White just graduated from dental school.He is hoping to acquire the necessary funding to start his own dental practice.One advantage of this type of business is:

While the Small Business Administration provides management advice to new business owners,it is not empowered to provide financial assistance.

The business opportunities with the greatest growth potential tend to be in the high technology industries.

Small business employees:

Big businesses do not serve all the needs of a market.

Small Business Administration loans help firms finance their domestic operations.These funds however,cannot be used to finance exports since the money is provided by U.S.taxpayers.

The easiest businesses to start also have the least growth potential and the greatest failure rates.

Hoping to qualify for a microloan from the Small Business Administration,Magdalena's business plan clearly identifies her strategy to profitably serve a target market.Unfortunately,her lack of business experience and limited collateral greatly reduce her chances of obtaining the microloan.

Enterprise zones are specific geographic areas that:

Felicia decided to work for a floral design studio before opening her own shop.This approach to learning the business is okay,but her time would be put to better use starting her own business.

For prospective entrepreneurs,enrolling in an introduction to business or small business management course offered through their community college:

According to SBA guidelines,a manufacturing firm with 1,000 employees:

A firm or individual providing financial capital to small businesses in exchange for an ownership stake in the company is called a:

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. -Peppy knows a lot about marketing,but not much about the legal or financial aspects of starting a new business.He wants to consult with a lawyer and accountant,but his budget is tight with all of the expenses involved in getting Peppy's Pizzazzeria up and running.Peppy should:

Jayne started a small bakery in a resort town.She was certain she had the ideal location,with plenty of hotels and inns within walking distance of her establishment.She planned to use her grandmother's recipes,using only the finest ingredients for her upscale resort customers.During the first week of business,she was disappointed with lackluster sales.When she drove past the regular breakfast style restaurants and even the Starbucks™,she noticed they were rather bustling.Jayne most likely:

As a result of corporate downsizing,Alex lost his job as an information systems manager for a large telecommunications company.A bonafide computer geek in his own right,Alex knew that several of his past company contacts often outsourced their computer problems.He decided it was a good time to test the waters and see if he could secure enough computer clients to be in business for himself.His success demonstrated that: