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Entrepreneurs and new ventures

Can you check through these review questions?

I feel pretty good about most of them; however I am having trouble supporting my responses to:

7,9,10,11,&13. Please let me know your thoughts on anything you feel is incorrect, and can you provide a reference to support your reasoning?

Question 1 of 25

Most business ventures that fail are:

A.More than five years old.
*** B.Less then five years old.
C.Less than one year old
D.More than seven years old.

Question 2 of 25

Entrepreneurs tend to have a higher probability of success when

*** A.The venture created is in their field of work experience.
B.The entire family is involved.
C.They are motivated solely from a profit standpoint.
D.The perceived level of risk is high

Question 3 of 25

In order to gain the financing needed to create a venture, entrepreneurs must often give up

A.Some control of the new venture
B.A share of the ownership
C.Patent rights
*** D.Both a and b

Question 4 of 25

Which of the following statements are true

*** A.An entrepreneur can work well with an equal partner
B.An entrepreneur is often pessimistic
C.An entrepreneur is a "loner"
D.An entrepreneur does not suffer fools gladly

Question 5 of 25

A life style company

A.Is grown so that the entrepreneur can live luxuriously.
*** B.Usually remains rather small and owned by the original entrepreneurs.
C.Is unusual for start-ups.
D.Stays like this because the owners cannot find someone to invest.

Question 6 of 25

A company that grows rapidly requires

A.A lot of money from investors.
*** B.An entrepreneur's willingness to give up a controlling interest.
C.Help from a major company
D.Products or services targeted at a billion dollar market.

Question 7 of 25

Which of the following is the least fruitful source for identifying business opportunities?

B.Other Entrepreneurs
C.Technical People
*** D.Family Members

Question 8 of 25

A spider-web provides an analogy to a small company because

A.It is continually under attack from outside
B.It has both radial and circumferential axes
C.It has multiple points for support on the outside
*** D.It is fragile

Question 9 of 25

A near-neighbor network is confined to

A.People living in the same neighborhood
B.People who have a fear of flying
*** C.People who can meet frequently
D.People who like each other

Question 10 of 25

A scale free network has

A.Members who only communicate on the Internet and never meet
B.Members who prefer to fly rather than drive
*** C.A few members who have many more contacts than the most
D.Most members know all the others

Question 11 of 25

The most likely place to spot a good opportunity is:

*** A.When working for a large company
B.When reading the newspaper
C.By talking with friends
D.By searching the internet

Question 12 of 25

Radical Innovation means that

A.Nothing from the past is retained
B.It applies to only products
*** C.It changes the rules of competition.
D.It is too risky for a start-up to follow.

Question 13 of 25

Which of the following "thought processes" are not usually found to be effective by an entrepreneur when seeking new opportunities

*** A.Copying a larger company but getting to market faster.
B.Solving "points of pain."
C.Taking an idea from one market and using it in a new field.
D.Making connections between two seemingly unrelated innovations to create new opportunities.

Question 14 of 25

Which of the following criteria would definitely indicate that the opportunity is highly risky:

A.Two well-financed companies have already tried this and went bankrupt.
B.There are three major well-entrenched competitors that are already cutting prices.
C.The product is a fashion item and you have little personal experience in this market.
*** D.All of the above

Question 15 of 25

The elements of the marketing mix that can best assist the entrepreneur in forecasting, market planning, and strategy and product development are

A.Distribution Channel Members
C.Elements in the Distribution Chain
*** D.All of the above

Question 16 of 25

Market Segmentation by Demographics includes

A.Defining targeted customers by income level.
*** B.Defining targeted customers by intelligence.
C.Defining targeted customers by educational level.
D.Defining targeted customers by height.

Question 17 of 25

Entering a market is more attractive when

A.The sector is declining and is not eliciting more competition.
B.Some customers are already supplying themselves internally.
C.There are high barriers to entry.
*** D.Currently there are no major competitors.

Question 18 of 25

Financial statements are an important part of the business planning process because

A.The planning process relates primarily to the financial function of the company.
B.After completing the business plan, the next step is to develop financial projections.
C.Financial statements are commonly used to express business expectations and results of performance.
*** D.None of the above.

Question 19 of 25

Conducting feasibility analysis of the venture is to

A.Define the goals and objectives of the venture.
B.Compile a list of potential investors.
C.Identify possible barriers to success.
*** D.Both A and C.

Question 20 of 25

If personal risk taking is a major concern, the following forms of company should be chosen

A.A partnership.
B.A sole proprietorship.
*** C.An LLC
D.No form at all.

Question 21 of 25

The disadvantages of an LLC are

A.Investors are not allowed.
B.The company cannot trade overseas.
*** C.Venture Capitalists will not invest.
D.The corporate tax rate is higher than a "C" corporation.

Question 22 of 25

In the first 30 days of your new company you should

A.Register your internet domain name.
*** B.Obtain an Employer ID Number from the IRS.
C.File your first tax return.
D.Join the local entrepreneurs' network.

Question 23 of 25

Between 30 and 60 days of formation you should have

A.Signed a lease on your business premises.
*** B.Developed relationships with a corporate banker.
C.Hired a marketing director.
D.Filed state tax returns.

Question 24 of 25

You are seeking a new name for your company that clearly conveys the nature of the business you are planning. Which of the following steps do you take?

A.Identify a name that is unique, catchy and professional.
B.Undertake a rigorous search to make sure that the name is not being used by a company in a similar or related business area.
C.Register the new name with the Patent and Trademark Office.
*** D.All of the above.

Question 25 of 25

You are seeking a web-address for your new company. Which of the following are not important?

A.You can only get the .net address as the .com is already taken.
*** B.You can buy the required domain names from a broker.
C.The name can be confused with an existing business.
D.The name is difficult to remember or pronounce.

Solution Preview

For number 7, the smallest data set is the worst, so you are correct (I think). The point is that "opportunity" is a technical term. It does not mean the random discovery of things that might work in business. It is a statistical term that usually refers to large data sets. Since family is small compared with the others, it is probably correct.

Number 9, as stated has two possible answers, which is why I hate multiple choice and never burdened by students with it. "Near Neighbor" is more or less a statistical term dealing with those data points that behave in a similar way. So "fear of flying" would be the closest, but people who like each other and neighbors in general might work too. If like refers to liking the same sort of thing, then this works. They would also meet frequently. I would argue "fear of flying" since it deals with a ...

Solution Summary

The entrepreneurs which trend to have a higher probability of success when a venture is created is determined. The financing needs to create a venture is provided.