PRINCIPLES OF MANAGEMENT
CHAPTER 6,Entrepreneurship
1. The difference between the transaction fee and intermediary models of e-commerce is that the transaction fee model charges a fee
a. for goods and services while the intermediary model charges a fee to direct website visitors to other companies' websites.
b. to advertise on a website while the intermediary model charges a fee to direct website visitors to other companies' websites.
c. for goods and services while the intermediary model charges a fee to bring buyers and sellers together.
d. to bring buyers and sellers together while the intermediary model charges a fee to advertise on a website.
e. to advertise on a website while the intermediary model charges a fee to bring buyers and sellers together.
2. In the context of entrepreneurship, a(n) _____ focuses on an entire venture and describes all the elements involved in starting it.
a. balance sheet
b. business plan
c. tax invoice
d. initial public offering
e. income statement
3. In the context of key planning elements, which of the following is true of what venture capital firms consider important for an entrepreneurial venture?
a) They believe that a good quality product is the best bet for an entrepreneurial venture.
b) They believe that a strong marketing campaign is the best for an entrepreneurial venture.
c) They believe that the greater the strength of a venture, the better it is.
d) They believe that the venture with the highest projected profit is the best.
e) They believe that what counts is a person's ability to execute an idea.
4. Which of the following is the difference between inventors and entrepreneurs?
a) Entrepreneurs have good knowledge and skills in management, business, and networking, whereas inventors lack such skills.
b) Entrepreneurs have better promoting skills than inventors.
c) Inventors are better able to ensure efficient operations, whereas entrepreneurs are unable to do so.
d) Inventors have lower levels of creativity and innovation as compared to entrepreneurs.
e) Inventors have better management, business, and networking skills as compared to entrepreneurs.
5. involves creating new systems, resources, or processes to produce new goods or services and/or serve new markets.
a) Entrepreneurship
b) Profiteering
c) Transporting
d) Advertising
e) Micropayment
6. A competitive advantage in the form of relationships with other people and the image other people have of an entrepreneur is known as
a) quality of life.
b) opportunity analysis.
c) legitimacy.
d) social capital.
e) community standing.
7. Which of the following individuals is most likely to become a successful entrepreneur?
a) Nigel enjoys challenges, has a strong social network, has good knowledge of management techniques, and possesses excellent business skills.
b) Edward is creative, embraces new ideas and products, and likes to motivate others but prefers working by himself.
c) Phoebe likes to invent new products, enjoys working in the laboratory, and avoids conflict whenever possible. She has little knowledge of business.
d) Hilary has an MBA and has been a manager in a corporate office for ten years. She likes a job to be well done and works best when she plans ahead.
e) Kylie has strong marketing and selling skills, and loves challenges in these areas.
8. The tendency of an organization 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
a) competitive aggressiveness.
b) bootlegging.
c) opportunity analysis.
d) entrepreneurial orientation.
e) innovativeness.
9. An entrepreneurial alliance between an innovator who has created at least one successful store and wants to grow and a partner who manages a new store of the same type in a new location is known as
a. the affiliate model.
b. an initial public offering.
c. the subscription model.
d. bootlegging.
e. franchising.
10. Which of the following qualities makes it most likely for an entrepreneur to succeed?
a) power hunger
b) opportunity obsession
c) cultural apathy
d) hypersensitivity
e) excessive risk taking
11. A difference between entrepreneurs and intrapreneurs is
a) the degree of success they gain after five years.
b) the salary of people who join their organizations.
c) the presence or absence of corporate support.
d) the type of computing systems used in their organizations.
e) the level of technical knowledge they have.
12. To meet the medical needs of a growing population of aged people, there has been an increase in entrepreneurial ventures specific for different medical problems of the aged. Which of the following types of opportunity does this exemplify?
a) demographic changes
b) lifestyle and taste changes
c) calamities
d) government initiatives and rule changes
e) economic dislocations
13. Which of the following entrepreneurial ventures is an example of low innovation and high risk?
a) A business selling a vaccine to combat malaria
b) An American restaurant serving burgers and fries
c) The first old age home in a region with a predominantly aging population
d) A business selling an automobile with new technology
e) The only tax preparation service in town
14. What is the role of the economic environment in the success of entrepreneurial ventures?
a) Entrepreneurial success is affected only by the talent and behavior of individuals, not by the economic environment.
b) A robust economy and the resulting increase in credit and demand boost the rate of new business formation, but a troubled economy has little effect on new ventures.
c) Downturns in the economic environment offer no opportunity for entrepreneurial success.
d) Entrepreneurial success is not affected by the economic environment; a good idea will prevail in all external conditions.
e) Increases in the money supply and the supply of bank loans lead to improved prospects and increased sources of capital.
15. Which of the following is true of common management challenges faced by entrepreneurs?
a. When competition heats up, a small start-up serving a niche market tends to flourish.
b. Going global creates challenges that can make survival difficult for a young company.
c. Entrepreneurs tend to enjoy each and every aspect of managing an entrepreneurial venture.
d. As the business grows, entrepreneurs readily delegate work to their subordinates.
e. The entrepreneur becomes too focused on the big picture and loses control of technical details.
16. Gerard realizes that the availability of appliances with embedded computer chips is low in the market. Hence, he uses this lucrative opportunity and sets up a store that sells appliances with embedded computer chips exclusively. Which of the following is Gerard engaging in?
a. partnership
b. brokerage
c. bootlegging
d. contracting
e. entrepreneurship
17. The sale to the public, for the first time, of federally registered and underwritten shares of stock in a company is called a(n)
a) futures exchange.
b) trade sale.
c) add-on sale.
d) initial public offering.
e) commodity exchange.
18. In the _____ approach to corporate innovation, risk takers are not punished for taking risks and failing-their former jobs are held for them.
a) bootlegging
b) horse trading
c) skunk works
d) job sharing
e) spinoff
19. What is the role of business incubators?
a. They provide a protected environment for new and small businesses.
b. They provide enhanced wellness benefits to employees of large businesses.
c. They provide new and small businesses with information silos.
d. They provide opportunities for exponential growth without competition.
e. They protect consumers from fraud.
20. Legitimacy in the minds of the public increases the probability of success of a new business by
a) helping a firm acquire other resources such as top managers, good employees, and government support.
b) helping to revise the rules and expectations of society.
c) weakening the competition and its ability to operate in the future.
d) eliminating any risk from the business plan.
e) reducing the number of resources necessary to start the firm such as office space, loans, and supplies.