Entrepreneurship I test

One advantage of establishing a new company as some type of a corporation is:

ability to shield owners from liabilities of or judgments against the company

To determine whether a business opportunity is realistic, the entrepreneur must:

determine how much capital is required to launch the business

A business plan has the following purpose:

describes in detail how the company’s product or service will be differentiated versus its competition 

Amari has had a frustrating week.  One of the new employees hired just last week showed up late her first two days, and another didn’t even show up one of his scheduled days.  Amari talked patiently with both of them in the hope that they could turn their situation around and become valuable team members.  Unfortunately, at the same time the bank returned the credit application that took Amari hours to fill out with requests for additional information.  Amari had to find the time to find that information and send the application back to the bank.  Finally, Amari really wanted to watch the The Voice on television tonight, but decided to stay in the store until closing because the store is short-staffed. 

 

The type of entrepreneurial behavior that Amari has been exhibiting can best be described as:

self-discipline

Compared to a bank loan, an online loan is:

much easier to obtain

An example of a fixed cost is:

monthly rent

A breakeven analysis can determine:

how many units the company will need to sell to pay for a new piece of equipment

The financial term liability refers to:

a debt or a loan a company must repay

Which is an entrepreneur?

an adult who started cutting grass as a pre-teen and now runs a gardening business with a sibling

Businesses should always set their prices: 

to reflect the value of their goods or services, not just their costs

Revenue per unit minus cost of goods sold equals:

contribution margin

A conflict of interest is:

a situation in which an individual might take an action to his/her advantage that would be to the disadvantage of a person or company that believe this individual is serving them

Loan applications require:

applicants to provide personal and business information that must be truthful

When launching a business, which is NOT a critical consideration?

what type of bank account the company will use

Characteristics of successful entrepreneurs include:

optimism

The government agency that enables companies to register to do business in the state of Louisiana is:

Secretary of State

An employee:

works for someone else

An example of a variable cost is:

cost of goods sold

An example of intellectual property is:

a patent on an invention

Total revenues minus total costs equals:

profits before owner compensation and taxes

Characteristics of successful entrepreneurs include:

grit

Which of the following best defines self-motivation?

ability to start and finish a task without giving up despite obstacles that might arise

The fixed costs of a business: 

are the same no matter how many customers the business serves

Which factors reduce the cost of borrowing from a bank?

a guarantor

Which of the following is a school expectation:

two months of summer vacation

A payment made to an insurance company to cover the costs of an insurance policy is called:

a premium

Successful entrepreneurs can be described as:

change agents

Corporate social responsibility:

are voluntary steps beyond a company’s financial self-interest that reflect what business leaders believe their companies can or should accomplish

Bank loan applications:

can be intimidating, complex and detailed

Parker needs money to expand the warehouse.  By expanding the warehouse the company will be able to carry a lot more inventory, which will make it possible for them to fill more customer orders much more quickly.  This expansion will cost approximately $150,000 in construction costs.  Purchasing the additional inventory will cost $50,000.  Over the next two years Parker believes this will increase sales 20% and profitability 25%.

 

What type of financing should Parker seek?

bank credit

The profit margin on an item a company sells can best be defined as:

price of the unit minus unit cost of goods sold

Which of the following is an essential skill for a successful entrepreneur and small business leader?

ability to interact in a friendly and effective way with people you don’t know

Pricing strategies may include: 

maximizing revenues for different products using different price points

Robin has been working throughout the week to get ready for the store opening on Friday.  The tiles for the entryway weren’t delivered on time, but Robin took the company van and picked up the tiles at the vendor’s warehouse.  When the utility didn’t connect the electricity on Monday, Robin stayed on hold for an hour before finding a supervisor who sent a utility tech right away.  

 

The type of entrepreneurial behavior that Robin has been exhibiting over the past week can best be described as:

determination

A company balance sheet is the single report that best indicates: 

company assets and liabilities

Advertising can be important for a new business because it:

communicates a differentiated message to your target customers

Is the workplace expectation for being on-time different than the high school expectation?

Yes – being late for work carries greater penalties than being late at school

A guarantor:

is a credit-worthy individual or business responsible for repaying a loan if the debtholder cannot

Which of the following is a work expectation:

serious consequences for failures in self-discipline

The maturity of a loan is:

the timeframe by which the borrower must repay the loan

Online loans are:

easier to obtain but more expensive than bank loans

Which is an entrepreneur?

a woman who designs and makes her own line of clothing and sells them to her friends

What is a “registered agent?” 

an individual responsible for receiving legal documents 

Self-discipline can best be defined as:

persistence

The geauxBIZ portal is:

a Louisiana Secretary of State website entrepreneurs use to register a company

Which of the following is a state government agency:

Louisiana Economic Development (LED)

Entrepreneurial problem solvers exhibit the following behaviors:

comfort performing under pressure

One critical difference between bank loans and online loans is:

the amount of information the applicant must provide

Consuelo’s gift store has an opportunity that will disappear if they don’t move quickly.  A competitor is moving to another state and they’ve offered to sell Consuelo their inventory at 25% of retail value.  Consuelo has inspected the inventory – it’s in perfect condition and includes all of the most popular items that Consuelo’s store sells every day.  In the upcoming holiday season 60 days away Consuelo is sure the store can sell pretty much all of this inventory.  Unfortunately this offer is only open for 48 hours – after that, the competitor will sell to another buyer.

 

What type of financing should Consuelo seek?

online credit

Characteristics of successful entrepreneurs include:

independence