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Franklin University MBA 711 Chapter 3 1)According to the U

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Franklin University

MBA 711

Chapter 3

1)According to the U.S. Department of Commerce, a business is considered "small" if it has fewer than employees.

A. 250

B. 1,000

C. 1,500

D. 100

E. 500

 

2.            A majority of small businesses are involved in which industry?

A.            Construction

B.            Wholesaling

C.            Services

D.            Transportation

E.            Retailing

 

2.            Which of the following would be considered a small business?

A.            A plant with 15 employees that is part of a global enterprise

B.            A small neighborhood grocery that is part of a chain

C.            A local supermarket and general store that is not part of a chain and employees 550 people

D.            A local dress shop with three employees

E.            A manufacturing company with 3,000 employees

 

3.            Which of the following types of businesses combines and transforms resources into tangible outcomes that are sold to others?

A.            Service

B.            Retailing

C.            Manufacturing

D.            Construction

E.            Wholesaling

 

4.            Brianna buys product in large quantities and then stores that product near the large retailers to which she sells the product throughout the year. Which type of business does Brianna own?

A.            Manufacturing

B.            Retailing

C.            Construction

D.            Service

E.            Wholesaling

 

5.            Which of the following is true of small businesses?

A.            They are generally part of a chain.

B.            They are independent and have little influence in the market.

C.            They have significant influence on the market.

D.            They require significant start-up capital.

E.            They have little impact on job creation.

 

6.            The process of seeking business opportunities, typically under conditions of risk, is referred to as                             .

A.            corporate governance

B.            divestiture

C.            venture speculation

D.            entrepreneurship

E.            franchising

 

7.            Which of the following would likely NOT be a characteristic of a successful entrepreneur?

A.            Strong customer relations skills

B.            Risk aversion

C.            Resourcefulness

D.            Desire for independence

E.            Ambition

 

8.            Which of the following is required to be considered an entrepreneur?

A.            You seek outside financing

B.            You do not desire growth and expansion

C.            You desire growth and expansion

D.            You assume the risk of business ownership

E.            You have a college education

 

9.            In contrast to stereotypes of entrepreneurs of the past, today's entrepreneurs are often            .

A.            clear on goals for growth and expansion

B.            self-reliant

C.            male

D.            open-minded leaders

E.            able to make quick, firm decisions

 

10.          Each of the following is a characteristic shared by most entrepreneurs EXCEPT?

A.            A concern for good customer relations

B.            The ability to deal with uncertainty and risk

C.            A desire to be their own boss

D.            Resourcefulness

E.            They must see what they do as risky

 

11.          Dale has been working in IT for a large company for the past 10 years and has often thought about starting his own business

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he has decided that now is the time. Dale has plans to start small and quickly build his business based on ideas he has worked on for several years. His goal is to double the size and the profitability of his business in the first three years. Which of the following BEST describes Dale's new business?

A.            A private corporation

B.            A public corporation

C.            A franchise

D.            A limited partnership

E.            A new venture

 

12.          A form of competitive advantage that a company achieves by being the first to enter a specific market or industry is known as       advantage.

A.            innovator

B.            product pioneer

C.            first-mover

D.            fast follower

E.            pacesetter

 

13.          Under a franchise agreement, the           grants the right to conduct business using its business model; the                owns and operates the local business.

A.            franchiser; franchisee

B.            franchisee; franchiser

C.            licensee; licensor

D.            entrepreneur; investor

E.            grantee; grantor

 

14.          Which of the following describes the aspect of business that a company performs better than its competitors?

A.            Entrepreneurship

B.            Distinctive competency

C.            Forecast

D.            Business plan

E.            Spin-off

 

15.          Brooke believes that there are many consumers who would like pizza delivery companies to deliver movies and popcorn along with their pizza. Brooke is looking at what type of market?

A.            New

B.            Cooperative

C.            Niche

D.            Established

E.            Franchise

 

16.          In which step of the business plan will the entrepreneur describe the match between his abilities and experiences and the requirements for producing or marketing the product?

A.            Incorporating the business

B.            Determining a distinctive competency

C.            Sales forecasting

D.            Financial planning

E.            Setting goals and objectives

 

17.          Juan is about to start his own business from scratch and needs to study the market to determine how to create his business plan for the bank. He knows that his location is appropriate for what he wants to sell and to whom he wants to sell. He knows where other stores that sell similar products are, how they are doing, and how much he needs to charge to make a profit and appeal to customers. Which question does Juan still need toanswer?

A.            Who and where are the customers?

B.            How much of the product can he expect to sell?

C.            Why will customers buy from him, rather than from his competitors?

D.            Who are his competitors?

E.            How much will the customers pay for the product?

 

18.          After working for a large firm for several years, Tyler started his own landscaping design

business. However, he soon ran out of money and was forced to close the business because he couldn't pay the expenses of the firm along with his personal expenses. Based on this information, what is the likely reason for Tyler's business failure?

A.            Insufficient demand for services being provided

B.            Neglect

C.            Insufficient capital

D.            Inexperience

E.            Weak control systems

 

19.          Cosmetics pioneer Estee Lauder said of her success in the cosmetics industry, "I never dreamed about success. I worked for it." Which basic factor of small business success does this BEST describe?

A.            Market demand for products/services provided

B.            Managerial competence

C.            Managerial experience

D.            Luck

E.            Hard work, drive, and dedication

 

20.          More than half of all new businesses will fail in the long run. Which of the following is NOT a general factor in small business failure?

A.            Weak control systems

B.            Repayment of franchise fees

C.            Insufficient capital

D.            Neglect

E.            Managerial incompetence

 

21.          Which of the following often explains why a small business is successful?

A.            Women owners

B.            Plenty of capital

C.            Luck

D.            New and emerging markets

E.            Strong control systems

 

22.          Which of the following trends has made it easier for entrepreneurs to start new businesses?

A.            Crossover from big business

B.            Global opportunities

C.            Better survival rates

D.            E-commerce

E.            Opportunities for minorities and women

 

23.          According to studies, what is one of the MOST common reasons that women are starting their own businesses?

A.            They have good ideas.

B.            They are not getting promoted in their current jobs.

C.            They want to set their own hours.

D.            They need the extra income.

E.            They see good opportunities.

 

24.          A             is a business that is owned and usually operated by one person.

A.            cooperative

B.            publicly held corporation

C.            limited partnership

D.            general partnership E. sole proprietorship

 

25.          Lee is a sole proprietor and owns a restaurant. When the economy falters, he is forced to close his restaurant and owes creditors nearly $24,000. The creditors can go after not only Lee's business assets but also his personal property such as his house, car, and personal bank account. This demonstrates the concept of                .

A.            unlimited liability

B.            double taxation

C.            a tender offer

D.            divestiture

E.            limited liability

 

26.          Which of the following is a disadvantage of a sole proprietorship?

A.            You cannot incorporate

B.            Complicated setup requirements

C.            Double taxation

D.            Unlimited liability

E.            Difficulty in transferring ownership

 

27.          Ryan invested money in a new business, but does not have time to help run the company. He is not going to be part of running the business, and is only liable for debt up to the amount he invested. Which type of partner is Ryan?

A.            General partner

B.            Limited partner

C.            Active partner

D.            Minority partner

E.            Master partner

 

28.          Jake owns his own small business. He has agreed to work with others who have similar small businesses so they can put together a stronger marketing campaign. Jake is now part of which of the following?

A.            Partnership

B.            Cooperative

C.            General partnership

D.            Master limited partnership

E.            Corporation

 

29.          Which is the MOST common type of small business partnership?

A.            Silent partnership

B.            Limited partnership

C.            General partnership

D.            Sole proprietorship

E.            Master limited partnership

 

30.          Which of the following is a strategy in which a firm sells one or more of its business units?

A.            Acquisition

B.            Franchise

C.            Joint venture

D.            Divestiture

E.            Strategic alliance

 

31.          Who are the owners of a corporation?

A.            Corporate officers

B.            Board of directors

C.            General partners

D.            Stockholders

E.            Employees

 

32.          Which type of corporation is organized like a corporation but treated like a partnership for tax purposes?

A.            Publicly held

B.            Closely held corporation

C.            S corporation

D.            Limited liability corporation

E.            Professional corporation

 

33.          Which of the following are the owners of a corporation?

A.            Silent partners

B.            Shareholders

C.            Officers

D.            Master limited partners

E.            The board of directors

 

34.          Tim and Ryan each have their own business, and together they are starting a new company that uses the best competencies of both their companies. The new organization will remain separate from their existing companies. Which of the following BEST describes their new endeavor?

A.            Joint venture

B.            A master limited partnership

C.            A limited partnership

D.            A closely held corporation

E.            A professional corporation

 

35.          K's Deli learned that the deli a couple miles away was having financial trouble and decided to buy the struggling deli and expand it. In what type of corporate action did K's Deli take part?

A.            Merger

B.            Acquisition

C.            Spin-off

D.            Partnership

E.            Divestiture