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Exam 6: Entrepreneurship and Starting a Small Business

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Question 101

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Since entrepreneurs are starting new businesses, experience gained from working for an established business isn't particularly helpful.

A) True
B) False

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Question 102

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A major advantage of preparing a formal business plan is that prospective entrepreneurs must identify the resources and activities required to successfully operate their proposed venture.

A) True
B) False

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Question 103

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Angel investors are the government agencies that invest money in new companies before they go public.

Rachel hopes to start her own business soon, but is concerned about her limited financial resources. She should save money by waiting to meet with lawyers and accountants until the business has grown and has been operating successfully for a few years.

Austin, Aiden, and Zara wanted to open A₂Z Sports Bar that serves a unique offering of beer, weekend entertainment, and a limited menu of appetizers. In one of the preliminary meetings, Zara presented a list of reasons that small businesses fail. Although many of the ideas on this list were applicable to many types of business, one challenge pertained specifically to the restaurant and bar business. The challenge he referred to was

Questions about how much authority to delegate and to whom, are easier issues for family-run businesses since they can't fire family.

Enterprise zones offer lower tax rates and government assistance to attract private business investment.

Mini-Case Pepe Pieman believes that pizza is a much more versatile meal than most people realize. As the national marketing manager for Pizza Pals, he has watched how consumers ate up barbecue pizza, Hawaiian pizza, Mexican pizza, and other new and unique combinations. His superiors, however, met his suggestions for other unusual pizzas with a negative response. Even some of his teammates laughed at his ideas. Pepe's confidence in his ability to understand the market has led him to focus on planning a business of his own. Pepe realizes that he will take a risk when he leaves his job with Pizza Pals and sets off on a new endeavor: Pepe's Pizzazzeria. Pepe is excited about the potential of profitably catering to the unmet desires of pizza consumers. -Since Pepe has worked in marketing for a large corporation before getting into the pizza business

Micropreneurs are motivated by a desire to have both a satisfying family life and rewarding work.

Kyle is a recent college graduate with a business degree. While still in school, he learned that as a potential small business owner, he should focus his sights on domestic business only.

The SBA's ________ program provides export-financing opportunities for small businesses.

Small businesses

As an employee of a small business, Dante has heard the owner is getting ready to retire. Since Dante would like to buy the business, he needs to determine how much the business is worth. In order to determine a fair price for the business, Dante should add up the market value of all of the firm's physical assets such as buildings, machinery, equipment, and inventory, and willingly pay this amount for the business.

Enterprise zones are specific geographic areas that

Since creating a detailed business plan is almost impossible, entrepreneurs should focus on the other tasks needed to get their firm started.

A business is considered small by comparing its size to others in the same industry.

Which of the following statements accurately depicts an advantage that small business has over big business?

The Spotlight on Small Business box is testimonial to the fact that entrepreneurs are problem solvers.

Due in part to government support, the majority of U.S. small businesses are involved in exporting.

Large multinational firms dominate the international market, leaving few opportunities for small businesses.