Question 1

A challenge associated with the sharing economy is

Accepted Answer

A)   whether workers are viewed as independent contractors or employees.
B)   the higher cost of services through this model.
C)   the intense competition from established firms.
D)   the inability to set standardized rates.
E)   the lack of flexibility in this model.

Question 2

Walt owns a business in which he offers standardized test preparation classes and individual tutoring for students. This is an example of a

Accepted Answer

A)   manufacturing business.
B)   wholesaler.
C)   retailer.
D)   service business.
E)   direct selling business.

Question 3

Dante runs Night Moves, his own DJ and party planning company. He has built a good reputation for organizing weddings and corporate events and his business has grown. He recently moved his business from his home to an office located in a corporate building and has increased his staff to 40 employees. Dante's company can be categorized as a

Accepted Answer

A)   multinational corporation.
B)   limited liability company.
C)   franchise.
D)   micropreneurship.
E)   small business.

Question 4

Frank, the owner of a local hardware store, decides to stock extra snow blowers and shovels this year, since his city is predicted to have an unusually snowy winter. Lacking sufficient capital to purchase the extra inventory, he borrows a predetermined sum of money from his bank. Which source of funding does this scenario best illustrate?

Accepted Answer

A)   trade credit
B)   initial public offering
C)   venture capital
D)   equity financing
E)   line of credit

Question 5

What is the purpose of the Small Business Administration?

Accepted Answer

A)   It protects consumers against unfair practices by businesses.
B)   It offers managerial and financial assistance to small businesses.
C)   It protects small businesses against competition from larger companies.
D)   It ensures that newly formed businesses adhere to the law.
E)   It regulates the issue of stocks by small businesses.

Question 6

How do small businesses contribute to the American economy?

Accepted Answer

Small businesses are vital to the Americ...

Question 7

What is undercapitalization? How does it contribute to the failure of a business?

Accepted Answer

The shortest path to failure in business...

Question 8

Bette works for a large company that is trying to function like a smaller company. What might the company do to achieve this goal?

Accepted Answer

A)   The company can increase its management layers.
B)   The company can increase its work tasks.
C)   The company can make its operating units function more like independent small businesses.
D)   The company can increase its corporate staff.
E)   The company can split each operating unit into a separate business.

Question 9

In the process of starting a business, along with developing a business plan, the entrepreneur needs to

Accepted Answer

A)   order supplies for the business.
B)   develop and employee manual.
C)   decide an appropriate legal form of business ownership.
D)   promote the business to the customers.
E)   file for tax returns for the business with the Internal Revenue Service.

Question 10

What affect has the economic turbulence of recent years had on small businesses?

Accepted Answer

A)   It has hurt nearly every small business.
B)   It removed the opportunity for small businesses to thrive in niche markets.
C)   Since small businesses cannot react quickly to change, most were forced into bankruptcy.
D)   It has provided both opportunities and threats for small businesses.
E)   Most small businesses were bought out by large companies.

Question 11

Since Sanjana decides to use her savings to purchase the rights to own and operate a Subway outlet rather than starting her own restaurant, she is most likely to be a(n)

Accepted Answer

A)   trade creditor.
B)   franchisee.
C)   category captain.
D)   intrapreneur.
E)   venture capitalist.

Question 12

Trevor lives in Florida during the winter months. While in Florida, he rents out his main home in Colorado to people traveling there for the skiing season. Trevor is participating in the sharing economy.

Accepted Answer

A) True 
 B)False

Question 13

Mark owns his own small bakery. In addition to being the owner, he also serves as the manager, sales force, head baker, shipping and receiving clerk, bookkeeper, and custodian. Mark is the first person to arrive at the bakery every morning and the last to leave every night. What is the most applicable challenge Mark faces?

Accepted Answer

A)   lack of funding
B)   pricing mistakes
C)   a high stress level
D)   underestimating the time commitment for success
E)   having poor business concepts

Question 14

A company is struggling in the marketplace and decides to reduce layers of management, personnel, and work tasks in order to remain competitive. This company is

Accepted Answer

A)   deregulating.
B)   shifting.
C)   expanding.
D)   layering.
E)   downsizing.

Question 15

Robert's Music Center is a local music shop. Along with selling musical instruments, it also rents instruments to students in school band programs. Robert is the owner and he employs three full-time and five part-time employees. Robert's business is a

Accepted Answer

A)   social entrepreneurship.
B)   limited liability company.
C)   small business.
D)   micropreneurship.
E)   conglomerate.

Question 16

Brett works for a large sporting goods corporation. He champions a new football helmet with advanced concussion protection. Brett is a(n)

Accepted Answer

A)   entrepreneur.
B)   intrapreneur.
C)   innovator.
D)   product leader.
E)   independent contractor.

Question 17

All of the following are programs and resources a small business owner can use to improve his or her ability to compete with other businesses EXCEPT

Accepted Answer

A)   classified files from his competitors.
B)   entrepreneurial training programs.
C)   seminars and college courses.
D)   local chambers of commerce.
E)   national publications and weekly business journals.

Question 18

Which description is the BEST example of a market niche?

Accepted Answer

A)   all the potential customers who are interested in buying a new vehicle
B)   the four deli sandwich shops that serve customers in and near a college campus
C)   elderly people, residing in assisted living centers, who suffer from macular degeneration
D)   people interested in taking a cruise to any of the Caribbean islands
E)   selecting to advertise women's apparel in magazines rather than through television ads

Question 19

If a small business fails to repay a bank loan, what will the lending institution do to recover its loss?

Accepted Answer

A)   take over the business and run it for profits
B)   claim and rent out the business
C)   sell stock in the business
D)   claim and sell the collateral or mortgage
E)   claim and sell all the owner's personal property

Question 20

Seamus has worked for a large corporation for years, and he feels like he just does not fit in the "corporate mold" anymore. He decides to start his own business because he wants the freedom to choose with whom he works and when and where he works. What advantage of small business ownership seems the most prevalent in this example?

Accepted Answer

A)   costs
B)   independence
C)   flexibility
D)   focus
E)   reputation

Exam 5: Small Business, Entrepreneurship, and Franchising

If a small business fails to repay a bank loan, what will the lending institution do to recover its loss?

Correct Answer
verified

Trevor lives in Florida during the winter months. While in Florida, he rents out his main home in Colorado to people traveling there for the skiing season. Trevor is participating in the sharing economy.

Correct Answer
verified

A challenge associated with the sharing economy is

Correct Answer
verified

Since Sanjana decides to use her savings to purchase the rights to own and operate a Subway outlet rather than starting her own restaurant, she is most likely to be a(n)

Correct Answer
verified

Which description is the BEST example of a market niche?

Correct Answer
verified

How do small businesses contribute to the American economy?

Correct Answer
verified
Small businesses are vital to the Americ...
View Answer

Brett works for a large sporting goods corporation. He champions a new football helmet with advanced concussion protection. Brett is a(n)

Correct Answer
verified

What is undercapitalization? How does it contribute to the failure of a business?

Correct Answer
verified
The shortest path to failure in business...
View Answer

All of the following are programs and resources a small business owner can use to improve his or her ability to compete with other businesses EXCEPT

Correct Answer
verified

Robert's Music Center is a local music shop. Along with selling musical instruments, it also rents instruments to students in school band programs. Robert is the owner and he employs three full-time and five part-time employees. Robert's business is a

Correct Answer
verified

Correct Answer
verified

What is the purpose of the Small Business Administration?

Correct Answer
verified

Walt owns a business in which he offers standardized test preparation classes and individual tutoring for students. This is an example of a

Correct Answer
verified

Correct Answer
verified

What affect has the economic turbulence of recent years had on small businesses?

Correct Answer
verified

Correct Answer
verified

A company is struggling in the marketplace and decides to reduce layers of management, personnel, and work tasks in order to remain competitive. This company is

Correct Answer
verified

Bette works for a large company that is trying to function like a smaller company. What might the company do to achieve this goal?

Correct Answer
verified

In the process of starting a business, along with developing a business plan, the entrepreneur needs to

Correct Answer
verified

Correct Answer
verified

Exam 5: Small Business, Entrepreneurship, and Franchising

If a small business fails to repay a bank loan, what will the lending institution do to recover its loss?

Correct AnswerverifiedShow Answer

Trevor lives in Florida during the winter months. While in Florida, he rents out his main home in Colorado to people traveling there for the skiing season. Trevor is participating in the sharing economy.

Correct AnswerverifiedShow Answer

A challenge associated with the sharing economy is

Correct AnswerverifiedShow Answer

Since Sanjana decides to use her savings to purchase the rights to own and operate a Subway outlet rather than starting her own restaurant, she is most likely to be a(n)

Correct AnswerverifiedShow Answer

Which description is the BEST example of a market niche?

Correct AnswerverifiedShow Answer

How do small businesses contribute to the American economy?

Correct AnswerverifiedSmall businesses are vital to the Americ...View AnswerShow Answer

Brett works for a large sporting goods corporation. He champions a new football helmet with advanced concussion protection. Brett is a(n)

Correct AnswerverifiedShow Answer

What is undercapitalization? How does it contribute to the failure of a business?

Correct AnswerverifiedThe shortest path to failure in business...View AnswerShow Answer

All of the following are programs and resources a small business owner can use to improve his or her ability to compete with other businesses EXCEPT

Correct AnswerverifiedShow Answer

Robert's Music Center is a local music shop. Along with selling musical instruments, it also rents instruments to students in school band programs. Robert is the owner and he employs three full-time and five part-time employees. Robert's business is a

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

What is the purpose of the Small Business Administration?

Correct AnswerverifiedShow Answer

Walt owns a business in which he offers standardized test preparation classes and individual tutoring for students. This is an example of a

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

What affect has the economic turbulence of recent years had on small businesses?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A company is struggling in the marketplace and decides to reduce layers of management, personnel, and work tasks in order to remain competitive. This company is

Correct AnswerverifiedShow Answer

Bette works for a large company that is trying to function like a smaller company. What might the company do to achieve this goal?

Correct AnswerverifiedShow Answer

In the process of starting a business, along with developing a business plan, the entrepreneur needs to

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified
Small businesses are vital to the Americ...
View Answer

Correct Answer
verified

Correct Answer
verified
The shortest path to failure in business...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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