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Exam 7: Small Business Entrepreneurship: Economic Rocket Fuel

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Question 21

Multiple Choice

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According to small business experts, while raising start-up funds from friends and relatives, it is:

A) acceptable to not repay them.
B) essential to involve them in company dealings.
C) acceptable to not document the financing.
D) essential to keep the relationship as professional as possible.

E) A) and B)
F) A) and D)

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Question 22

Multiple Choice

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Beyond the sheer value of the goods and services they generate, small businesses make a powerful contribution to the U.S. economy in terms of:

A) merging billion-dollar corporations.
B) powering the stock market.
C) creating new jobs.
D) accounting for all private sector output.

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

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Question 23

Multiple Choice

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Herbert uses prominent social media websites to promote his newly opened restaurant. He constantly posts promotional offers and provides coupons that customers can redeem to avail discounts when they dine in the restaurant. The opportunity of _____ is highlighted in the given scenario.

Explain the significance of small businesses in the U.S. economy.

Bertha runs a fashion boutique. She prefers to personally interact with her customers to gauge the styles that would suit their personality. Her customers also prefer talking to her in person to share their preferences in colors, designs, styles, and fabric as they value her suggestions. The opportunity of _____ is highlighted in the given scenario.

The U.S. Small Business Administration (SBA) gives interest-free loans to start-up businesses and fully guarantees loans from local commercial lenders.

Jenna left her job as an analyst in a reputed company to start her own event management company at a time when event management was not in vogue. She was bold enough to take this step despite knowing the amount of risk involved. Which entrepreneurial characteristic is highlighted in the given scenario?

An effective business plan is usually 25 to 50 pages long.

Gemini Inc., a large conglomerate, offered Timothy's new logistics company the much required financial support in exchange for a 40% ownership in the company. It also provided Timothy with an experienced group of people to help him make crucial decisions for the company. In the given scenario, which of the following statements is true of Gemini Inc.?

Robert wants to start an independent recording studio. In order to finance his start-up, Robert seeks help from Esther, a successful business magnate. Esther agrees to fund Robert's venture as long as she receives a 20% share of the profits made by Robert. In the given scenario, Robert receives the financial resources to start his business:

Rudy, a food truck owner, has sizable followers on his website where he personally interacts with them and thanks them for their support. He also lets his followers know his location and the menu for a day in advance. The opportunity of _____ is highlighted in the given scenario.

The U.S. Small Business Administration (SBA) gives free money to start-up businesses.

Rudy owns a small metal fabrication business that employs 23 workers. As the owner of a small business, one of the major advantages that Rudy enjoys while competing with larger firms is reduced burden of complying with government regulations.

The Global Entrepreneurship Monitor (GEM) shows that people living in high-income countries tend to be much more willing to start their own businesses than people living low-income countries.

Which of the following is a characteristic of successful entrepreneurs?

Describe any two basic qualities that define successful entrepreneurs.

Felix lost his job at an investment firm because of downsizing during a period of recession. To keep himself financially stable, he opened a food truck that became a huge success. Which of the following advantages of entrepreneurship initially motivated Felix to start the food truck?

Ruben owns an astronomy-themed restaurant. The entire restaurant resembles a planetarium. He has also installed a projector that transforms the ceiling into a night sky. Ruben used most of his savings to fund this venture and also borrowed funds from his friends and family. In the given scenario, Ruben used _____ to fund his business.

Which of the following is an appealing benefit that entrepreneurs enjoy?

In the context of funding options for small businesses, the _____ assists entrepreneurs by partially guaranteeing loans from local commercial lenders.