Question 1

When things go poorly, people with an internal locus of control feel that:

Accepted Answer

A)   they need to do better next time.
B)   fate is the cause of their failure.
C)   their efforts have been invalidated.
D)   they are victims of others' actions.

Question 2

_____ are wealthy individuals who invest in startup companies with high growth potential in exchange for a share of ownership.

Accepted Answer

A)   Angel investors
B)   Commercial lenders
C)   Private lenders
D)   Alternative lenders

Question 3

One of the biggest problems facing people who want to start a small business is the lack of educational resources available to help them learn the ins and outs of starting and managing their new company.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following places small businesses at a disadvantage compared to larger competitors?

Accepted Answer

A)   Higher overhead costs
B)   Higher insurance costs
C)   Finding market niches
D)   Lower regulatory expectations

Question 5

Roman Sivkov migrated to the United States from Russia soon after the collapse of the Soviet Union. He is very bright and is willing to work hard, but he has had a hard time keeping a full­time job because of his limited command of English and heavy accent. Roman may well find that entrepreneurship is his best option for economic success.

Accepted Answer

A) True 
 B)False

Question 6

An effective business plan is usually:

Accepted Answer

A)   15 to 20 pages long and takes about a month to write.
B)   100 pages long and takes about one year to write.
C)   25 to 50 pages long and takes about six months to write.
D)   1 to 5 pages long and takes about a week to write.

Question 7

Fatima has decided to become an entrepreneur in Italy because the country's high entrepreneurship rate provides her employment protection and strong unemployment insurance.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following is NOT a core question that is answered by a business plan?

Accepted Answer

A)   Who are the potential customers for your product or service?
B)   How will you reach your potential customers?
C)   What product or service does your business provide?
D)   How will the business diversify after five years?

Question 9

Entrepreneurship rates vary according to their location. Low income countries such as Zambia tend to have higher entrepreneurship rates than in high income countries such as Japan.

Accepted Answer

A) True 
 B)False

Question 10

Red Oak Capital Inc. recently funded Feast LLC, a rapidly­growing chain of restaurants, in exchange for 43 percent share of ownership. Red Oak Capital is an example of a(n)  _____.

Accepted Answer

A)   commercial bank
B)   angel investor
C)   credit union
D)   venture capital firm

Question 11

Small business start­ups are likely to find that getting commercial loans is:

Accepted Answer

A)   hard to do because commercial lenders are reluctant to loan to firms that don't have an established record of successful performance.
B)   one of the easiest and most flexible sources of financing because local bankers are usually eager to establish relationships with new companies.
C)   relatively difficult because the risks involved are great because they entail much higher financing costs when compared to other sources.
D)   the best way to obtain 100 percent of the financing they need, but only if they give the lender an ownership stake in the company.

Question 12

Eloise requires funding for her newly­launched online shopping website. However, she has a very low credit score and wants to retain complete control of her business. Given Eloise's situation, which of the following sources of finance would be ideal?

Accepted Answer

A)   Angel investor
B)   Alternative lender
C)   Commercial bank loan
D)   Venture capital firm

Question 13

The majority of new firms are funded with the personal resources of the founder.

Accepted Answer

A) True 
 B)False

Question 14

What is the purpose of a business plan? Identify the core questions a business plan should address.

Accepted Answer

A business plan is a formal document tha...

Question 15

Peer­to­peer lending is a funding option for entrepreneurs that is easier and has better borrowing terms than more established sources, such as commercial loans.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following scenarios best illustrates an entrepreneur?

Accepted Answer

A)   Jackson launched his business in the residential construction industry in 2006, but lost everything in 2007 when the market changed. As he regroups, he formulates a philosophy that failure is a beginning for him, and not an end. As he clears away the rubble of his disaster, he begins to build a new enterprise.
B)   Jewel launched into the film business by crafting a successful independent film. Unfortunately for her, revenues were not sufficient for her to pay off her hefty equipment and travel debts. As she files for bankruptcy, she reads the classifieds and vows, to never go back.
C)   Mike's Metronome Manufacturing, LLC has specialized in timekeeping devices for musicians for several decades. Mike passed away and left the operation to his sons. They in turn run it competently, but it gradually loses market share because its product line is no longer innovative since Mike died.
D)   Basil's great grandfather left him a considerable inheritance, which is managed by several hundred different men at different agencies, including a philanthropic institution that provides venture capital to startup companies. Basil lives quite comfortably and is very grateful to his late grandfather.

Question 17

Entrepreneurship rates are high in countries in which the people:

Accepted Answer

A)   have a high level of government­provided unemployment protection.
B)   have a low entrepreneurial urge and have a low fear of failure.
C)   start their own business because they have no other option.
D)   maintain strong government­ provided unemployment insurance.

Question 18

It is less risky for individuals who want to become small business owners to start their own business than to buy an existing business.

Accepted Answer

A) True 
 B)False

Question 19

The nation of Mizentin has the lowest entrepreneurship rate globally. A new government headed by Prime Minister Anson Rhone aims to make the country's business environment more friendly toward burgeoning entrepreneurs. Which of the following measures should be taken to increase the entrepreneurship rate in Mizentin?

Accepted Answer

A)   Increase unemployment insurance available to employees
B)   Eliminate complex regulations placed on businesses
C)   Mandate that all businesses must provide employee healthcare
D)   Initiate employment protection laws

Question 20

_____ are typically private firms that charge very high interest rates, structure loans to be repaid in months rather than years, and often collect payments daily or weekly to reduce risk.

Accepted Answer

A)   Personal lenders
B)   Commercial lenders
C)   Alternative lenders
D)   Angel lenders

Exam 7: Small Business Entrepreneurship: Economic Rocket Fuel

Small business startups are likely to find that getting commercial loans is:

Correct Answer
verified

An effective business plan is usually:

Correct Answer
verified

Entrepreneurship rates are high in countries in which the people:

Correct Answer
verified

Correct Answer
verified

Peertopeer lending is a funding option for entrepreneurs that is easier and has better borrowing terms than more established sources, such as commercial loans.

Correct Answer
verified

_____ are typically private firms that charge very high interest rates, structure loans to be repaid in months rather than years, and often collect payments daily or weekly to reduce risk.

Correct Answer
verified

Which of the following is NOT a core question that is answered by a business plan?

Correct Answer
verified

One of the biggest problems facing people who want to start a small business is the lack of educational resources available to help them learn the ins and outs of starting and managing their new company.

Correct Answer
verified

Which of the following places small businesses at a disadvantage compared to larger competitors?

Correct Answer
verified

Eloise requires funding for her newlylaunched online shopping website. However, she has a very low credit score and wants to retain complete control of her business. Given Eloise's situation, which of the following sources of finance would be ideal?

Correct Answer
verified

_____ are wealthy individuals who invest in startup companies with high growth potential in exchange for a share of ownership.

Correct Answer
verified

It is less risky for individuals who want to become small business owners to start their own business than to buy an existing business.

Correct Answer
verified

What is the purpose of a business plan? Identify the core questions a business plan should address.

Correct Answer
verified
A business plan is a formal document tha...
View Answer

The majority of new firms are funded with the personal resources of the founder.

Correct Answer
verified

Correct Answer
verified

Which of the following scenarios best illustrates an entrepreneur?

Correct Answer
verified

Entrepreneurship rates vary according to their location. Low income countries such as Zambia tend to have higher entrepreneurship rates than in high income countries such as Japan.

Correct Answer
verified

When things go poorly, people with an internal locus of control feel that:

Correct Answer
verified

Fatima has decided to become an entrepreneur in Italy because the country's high entrepreneurship rate provides her employment protection and strong unemployment insurance.

Correct Answer
verified

Red Oak Capital Inc. recently funded Feast LLC, a rapidlygrowing chain of restaurants, in exchange for 43 percent share of ownership. Red Oak Capital is an example of a(n) _____.

Correct Answer
verified

Exam 7: Small Business Entrepreneurship: Economic Rocket Fuel

Small business start­ups are likely to find that getting commercial loans is:

Correct AnswerverifiedShow Answer

An effective business plan is usually:

Correct AnswerverifiedShow Answer

Entrepreneurship rates are high in countries in which the people:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Peer­to­peer lending is a funding option for entrepreneurs that is easier and has better borrowing terms than more established sources, such as commercial loans.

Correct AnswerverifiedShow Answer

_____ are typically private firms that charge very high interest rates, structure loans to be repaid in months rather than years, and often collect payments daily or weekly to reduce risk.

Correct AnswerverifiedShow Answer

Which of the following is NOT a core question that is answered by a business plan?

Correct AnswerverifiedShow Answer

One of the biggest problems facing people who want to start a small business is the lack of educational resources available to help them learn the ins and outs of starting and managing their new company.

Correct AnswerverifiedShow Answer

Which of the following places small businesses at a disadvantage compared to larger competitors?

Correct AnswerverifiedShow Answer

Eloise requires funding for her newly­launched online shopping website. However, she has a very low credit score and wants to retain complete control of her business. Given Eloise's situation, which of the following sources of finance would be ideal?

Correct AnswerverifiedShow Answer

_____ are wealthy individuals who invest in startup companies with high growth potential in exchange for a share of ownership.

Correct AnswerverifiedShow Answer

It is less risky for individuals who want to become small business owners to start their own business than to buy an existing business.

Correct AnswerverifiedShow Answer

What is the purpose of a business plan? Identify the core questions a business plan should address.

Correct AnswerverifiedA business plan is a formal document tha...View AnswerShow Answer

The majority of new firms are funded with the personal resources of the founder.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following scenarios best illustrates an entrepreneur?

Correct AnswerverifiedShow Answer

Entrepreneurship rates vary according to their location. Low income countries such as Zambia tend to have higher entrepreneurship rates than in high income countries such as Japan.

Correct AnswerverifiedShow Answer

When things go poorly, people with an internal locus of control feel that:

Correct AnswerverifiedShow Answer

Fatima has decided to become an entrepreneur in Italy because the country's high entrepreneurship rate provides her employment protection and strong unemployment insurance.

Correct AnswerverifiedShow Answer

Red Oak Capital Inc. recently funded Feast LLC, a rapidly­growing chain of restaurants, in exchange for 43 percent share of ownership. Red Oak Capital is an example of a(n) _____.

Correct AnswerverifiedShow Answer

Small business startups are likely to find that getting commercial loans is:

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Peertopeer lending is a funding option for entrepreneurs that is easier and has better borrowing terms than more established sources, such as commercial loans.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Eloise requires funding for her newlylaunched online shopping website. However, she has a very low credit score and wants to retain complete control of her business. Given Eloise's situation, which of the following sources of finance would be ideal?

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
A business plan is a formal document tha...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Red Oak Capital Inc. recently funded Feast LLC, a rapidlygrowing chain of restaurants, in exchange for 43 percent share of ownership. Red Oak Capital is an example of a(n) _____.

Correct Answer
verified