Intro to Entrepreneurship OSU Exam 1
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Which one of the following is NOT an essential quality of an opportunity?
A. It is profitable.
B.
It is timely.
C.
It is durable.
D.
It is attractive.
E.
It is anchored in a product, service, or business that creates or adds value to buyer or end-user.
A. It is Profitable
Which one of the following is NOT a social trend that is currently affecting how individuals behave and set up priorities?
A.
Passage of the Affordable Care Act (Obamacare)
B.
Aging of the population
C.
Increased participation in social networks
D.
Growth in the use of mobile devices
E.
The increasing diversity of the workforce
A.
Passage of the Affordable Care Act (Obamacare)
____ in the marketplace are a source of business opportunities.
A.
Gains
B.
Gaps
C.
Profits
D.
Successes
E.
Revenues
B. Gaps
Elon Musk, the founder of the electric car company Tesla and co-founder of the solar panel company SolarCity is credited with having a "sixth sense" that allows him to see opportunities that others miss. This sixth sense that Elon Musk has is called _______.
A.
entrepreneurial alertness
B.
entrepreneurial readiness
C.
market readiness
D.
opportunity recognition
E.
market perception
A. entrepreneurial alertness
John and Amy both work in the billings department of Acme Corp. The nature of their job involves frequent interaction with each other every working day. The tie between John and Amy is an example of a_______ relationship.
A.
corporate
B.
lifestyle
C.
weak-tie
D.
entrepreneurial
E.
strong-tie
E. strong-tie
The number one rule for a brainstorming session is that __________.
A.
the session moves slowly and deliberately
B.
freewheeling is discouraged
C.
no criticism is allowed
D.
every idea is immediately critiqued
E.
leapfrogging is discouraged
C. no criticism is allowed
A popular technique used in classrooms to teach brainstorming is called the ______ report.
A.
trends
B.
churn
C.
ideas
D.
opportunities
E.
bug
E. bug
Intuit (which makes Quicken and TurboTax products) routinely sends teams of testers to the homes and businesses of its users to see how its products are working and to see insights for new product ideas. Intuit uses ________ research.
A.
day-in-the-life
B.
symbolic
C.
motivation
D.
entrepreneurial
E.
focus group
A. day-in-the-life
The term window of opportunity is a metaphor describing the ____ in which a firm can realistically enter a new market.
A.
arena
B.
time period
C.
confidence
D.
region
E.
value proposition
B. time period
Which of the following relationships is more likely to spark a new idea?
A.
Weak-tie
B.
Solo
C.
Strong-tie
D.
Frequent
E.
Network
A. Weak-tie
Which of the following is NOT a key area in feasibility analysis?
A.
Organizational feasibility
B.
Product/service feasibility
C.
Entrepreneurial feasibility
D.
Financial feasibility
E.
Industry/target market feasibility
C. Entrepreneurial feasibility
When you do research by conducting focus groups, you are conducting _____ research.
A.
secondary
B.
exploitative
C.
archival
D.
primary
E.
tertiary
D. primary
A preliminary description of a product or service idea is called a(n) ______.
A.
feasibility analysis
B.
business model
C.
opportunity analysis
D.
business plan
E.
concept statement
E. concept statement
Click here to buy a Maui vacation" is an example of a(n) _______ page.
A.
pass-through
B.
webbing
C.
money
D.
landing
E.
action
D. landing
Which of the following is NOT a characteristic of an attractive industry?
A.
Is concentrated rather than fragmented.
B.
Is young rather than old.
C.
Is not crowded.
D.
Is early rather than late in its life cycle.
E.
Has high rather than low operating margins.
A. Is concentrated rather than fragmented.
Jenny Smith is examining the feasibility of launching a start-up to make an online game for pre-teen girls. Jenny's _____ market is the limited portion of the industry that it goes after or to which it wants to appeal.
A.
target
B.
scalable
C.
broad
D.
entrepreneurial
E.
lifestyle
A. target
Delta, United, American, and Southwest are all in the business of providing airline services to passengers. Together, these firms constitute a(n) ______.
A.
industry
B.
entry barrier
C.
oligopoly
D.
monopoly
E.
target market
A. industry
Daisy and April, two budding entrepreneurs, are examining the skilled labor pool in the community where their start-up is to be launched. Daisy and April are determining their venture's ______.
A.
financial viability
B.
resource sufficiency
C.
industry
D.
fiscal viability
E.
market
B. resource sufficiency
Mitch Johnson, age 22, and Dawn Faircloth, age 21, are assessing the resources of their educational toys start-up, EduVenture. Which of the following is NOT a typical critical nonfinancial resource for EduVenture?
A.
Affordable office space
B.
Manufacturing space
C.
Contract manufacturers
D.
Key support personnel
E.
The age of the founders
E. The age of the founders
If a proposed new venture moves beyond the feasibility analysis stage, it will need to complete ____ financial statements that demonstrate the firm's financial viability for the first 1-3 years of its existence.
A.
non-scalable
B.
profitable
C.
audited
D.
pro forma
E.
attractive
D. pro forma
The three important elements of a firm's business model are its target market, its basis for differentiation, and its ______.
A.
founders' backgrounds
B.
key assets
C.
mission
D.
form of organization
E.
vision
B.
key assets
The proper time to determine a company's business model is following the _______ of the business idea and prior to fleshing out the operational details of the firm.
A.
launch
B.
capitalizing
C.
financing
D.
initial validation
E.
marketing
D. initial validation
There are two general categories of business models: standard and _____ business models.
A.
informational
B.
motivational
C.
disruptive
D.
explorational
E.
exploitative
C. disruptive
_____ refers to the number of subscribers that a subscription-based business loses each month.
A.
Destruction
B.
Disruption
C.
Scalability
D.
Burn
E.
Churn
E. Churn
Uber connects ride seekers with car owners willing to provide rides. Uber is an example of a(n) _______ business model.
A.
standard
B.
unsustainable
C.
disruptive
D.
non-scalable
E.
unviable
C. disruptive
_____ disruption is possible when the firms in an industry continue to improve products or services to the point where they are actually better than a sizeable portion of their clientele needs or desires.
A.
Medium-end
B.
Non-market
C.
Low-end
D.
Standard
E.
High-end
C. Low-end
Which of the following is NOT a primary element of core strategy?
A.
Basis of differentiation
B.
Target market
C.
Product/market scope
D.
Business mission
E.
Finances
E. Finances
A business's ____ describes why it exists and what its business model is supposed to accomplish.
A.
marketing plan
B.
budget
C.
balance sheet
D.
income statement
E.
mission
E. mission
A company's _______ is what causes consumers to pick that company's products over another's.
A.
marketing plan
B.
advertising budget
C.
financial clout
D.
basis of differentiation
E.
marketing budget
D. basis of differentiation
A(n) ____ market is a place within a larger market segment that represents a narrower group of customers with similar interests.
A.
sustainable
B.
target
C.
scalable
D.
capital
E.
approachable
B. target
It is useful for a new venture to think about its position at both the _____ level and the product or service level.
A.
industry
B.
global
C.
cooperative
D.
company
E.
international
D. company
Economic trends, ____ trends, technological advances, and political and regulatory changes are the most important environmental trends for entrepreneurs to study.
A.
information
B.
social
C.
motivation
D.
exploration
E.
innovation
B. social
The five forces model looks at forces that determine _____ profitability.
A.
firm
B.
industry
C.
customer
D.
product
E.
national
B. industry
Which of the following is NOT a force as per the five forces model?
A.
The threat of new entrants
B.
Bargaining power of stockholders
C.
The bargaining power of suppliers
D.
The threat of substitutes
E.
Rivalry among existing firms
B. Bargaining power of stockholders
In analyzing the pharmaceutical industry for a prospective business launch, Nicole Turco, a Ph.D. in pharmacology, concluded that the industry was attractive because the threat of substitutes is ___________.
A.
existent
B.
nonstandard
C.
high
D.
standard
E.
low
E. Low
A _____ is a condition that creates a disincentive for a new firm to enter an industry.
A.
barrier to exist
B.
barrier to entry
C.
barrier to move
D.
barrier to coerce
E.
barrier to exploit
B. barrier to entry
In contemplating the launch of her seafood restaurant, Paige Graham concluded that suppliers of seafood had an advantage in bargaining power over restaurant owners in her market. Paige's conclusion is likely to have happened because there were __________ suppliers to provide a critical product to a large number of restaurants.
A.
only a few
B.
several
C.
a moderate number of
D.
a fair number of
E.
many
A. only a few
A(n) _____ industry is one in which standard operating procedures have yet to be developed.
A.
fragmented
B.
mature
C.
stagnating
D.
declining
E.
emerging
E. emerging
A(n) ________ advantage is a sometimes insurmountable advantage gained by the first company to establish a significant position in a new market.
A.
first-mover
B.
late-mover
C.
lateral-mover
D.
incumbent
E.
second-mover
A. first-mover
The consumer milk industry in the United States over the last few years is characterized by slow growth, repeat (rather than new) customers, and limited product innovation. This industry is an example of a(n) ______ industry.
A.
mature
B.
global
C.
emerging
D.
fragmented
E.
declining
A. mature
______ analysis is the process of determining whether a business idea is viable.
A.
Industry
B.
Opportunity
C.
Structural
D.
Marketing
E.
Feasibility
E. Feasibility
_____ research is research collected by the person(s) completing the analysis.
A.
Library
B.
Tertiary
C.
Primary
D.
Secondary
E.
Archival
C. Primary
A ____ test involves showing a preliminary description of a product or service idea.
A.
market
B.
concept
C.
functional
D.
feasibility
E.
customer
B. concept
_____ bias is the tendency to search for information that validates one's preconceptions.
A.
Confirmation
B.
Duplication
C.
Reservation
D.
Proclamation
E.
Reliability
A. Confirmation
PepsiCo, Coca-Cola, Dr. Pepper, and Schweppes are a group of firms that produce carbonated beverages. Together, these firms constitute a(n) ______.
A.
market
B.
cohort
C.
industry
D.
oligopoly
E.
organization
C. industry
Shelter Pups makes eco-friendly plush animals. The company aims its product at parents who are willing to pay a premium for super-safe, environmentally friendly, educational toys. This is Shelter Pups' ______.
A.
business model
B.
budget
C.
industry
D.
business plan
E.
target market
E. target market
In examining resource sufficiency, the focus in organizational feasibility analysis is on ____ resources.
A.
all
B.
financial and nonfinancial
C.
nonfinancial
D.
financial
E.
past
C. nonfinancial
The most important issues to consider in financial feasibility analysis are ________, financial performance of similar businesses, and the overall financial attractiveness of the proposed venture.
A.
market share
B.
owners' equity
C.
total debt
D.
profit margin
E.
total start-up cash needed
E. total start-up cash needed
Which of the following is NOT a factor against which a start-up's projected rate of return should be weighed?
A.
The existing alternatives for the entrepreneur's time and efforts
B.
The amount of capital invested
C.
The existing alternatives for the money being invested
D.
The risks assumed in launching a business
E.
The returns required by the venture capital firms
E. The returns required by the venture capital firms
____ is a template entrepreneurial firms use to complete a feasibility analysis.
A.
First Go
B.
First Screen
C.
Final Pass
D.
First Shot
E.
Final Shot
B. First Screen
Uber provides transportation service for people by quickly connecting riders with the owners of private cars who are willing to provide rides. As far as local taxis are concerned, Uber's business model ___ their business.
A.
supports
B.
disrupts
C.
complements
D.
validates
E.
enables
B. disrupts
Netflix has a subscription business model, where it adds and loses subscribers each month. One of the disadvantages of the subscription business model is ____.
A.
churn
B.
its lack of scalability
C.
its limited market potential
D.
lack of profit focus
E.
its disruptiveness
A. churn
Ryanair, like Southwest Airlines, provides point-to-point, no-frills airline service, in Ryanair's case across Europe. This is an example of _______ disruption.
A.
standard
B.
high-end
C.
medium-end
D.
low-end
E.
financial
D. low-end
At a very broad, 50,000-foot level, a mission statement indicates how a firm intends to create value for _______.
A.
stakeholders
B.
suppliers
C.
owners
D.
customers
E.
investors
A. stakeholders
Etsy generates its revenues by bringing two parties together to complete a sale. Its revenue stream is based on ____.
A.
licensing
B.
advertising
C.
matchmaking
D.
commissions
E.
download fee
D. commissions
For the start-up Her Campus, there are 4,000-plus college females volunteering in chapters across the country writing articles in which they believe other college females will be interested. The volunteer group is an example of ______ in Her Campus's business model.
A.
a revenue stream
B.
key assets
C.
target market
D.
customers
E.
basis of differentiation
B. key assets
Over the course of the last few years, Etsy has built a network of over 1.7 million sellers of artisanal goods. The fact that it would take a tremendous effort on the part of a competitor to match Etsy's network of sellers makes Etsy's business model difficult to _____.
A.
scale
B.
copy
C.
act immediately
D.
launch
E.
be profitable
B. copy
Prior to launching his Korean-Mexican fusion restaurant, Gregory Kim is making a detailed evaluation of the restaurants in his market area. Gregory Kim is doing a ____ analysis.
A.
industry
B.
resource
C.
stakeholder
D.
competitor
E.
stockholder
D. competitor
The five forces in the five forces model determine the threat to industry _______.
A.
stakeholders
B.
products
C.
services
D.
profitability
E.
revenues
D. profitability
A(n) _____ industry is an industry or a part of an industry that is experiencing a reduction in demand.
A.
declining
B.
nurturing
C.
mature
D.
emerging
E.
fragmented
A. declining
A(n) ____ industry is one that is characterized by a large number of firms of approximately equal size.
A.
fragmented
B.
mature
C.
global
D.
declining
E.
emerging
A. fragmented
_____ competitors are businesses that offer products or services that are identical or highly similar to those of the firm in question.
A.
Peripheral
B.
Future
C.
Substitute
D.
Indirect
E.
Direct
E. Direct
Coffee, milk, tea, and water are ______ competitors for Coca-Cola.
A.
not
B.
future
C.
peripheral
D.
direct
E.
indirect
E. indirect
Economic trends, ____ trends, technological advances, and political and regulatory changes are the most important environmental trends for entrepreneurs to study.
A.
social
B.
motivation
C.
innovation
D.
exploration
E.
information
A. social
The ability of firms in some industries to benefit from an increasing ability to outsource manufacturing or service functions to lower-cost foreign labor markets is an example of a(n) _____ trend.
A.
regulatory
B.
social
C.
business
D.
economic
E.
technological
C. business
If the price of the United States Postal Service's express mail gets too high, people will increasingly attach documents to e-mail messages. This is an example of ________.
A.
bargaining power of buyers
B.
threat of new entrants
C.
bargaining power of suppliers
D.
intensity of rivalry
E.
threat of substitutes
E. threat of substitutes
______ occur(s) when mass-producing a product results in lower average costs.
A.
Customization
B.
Product differentiation
C.
Economies of scale
D.
Economies of scope
E.
Globalization
C. Economies of scale