DECA Entrepreneurship Terms and Questions

these are questions/words i missed/need to learn - study quiz let’s, corporate jargon, add examples

Channel members add value to a product by

pursuing individual goals.

close corporation

A corporation whose shareholders are limited to a small group of persons, often family members.

open corporation

a corporation whose stock can be bought and sold by any individual

Sole Proprietorship

a business owned and managed by a single individual

General Partnership

partnership in which partners share equally in both responsibility and liability

When responding to an official request for a formally solicited project, the writer creating the proposal should

follow directions in the request for proposal document.

In many places, trash pickup is legally controlled by just one company. This is known as

a regulated monopoly.

Regulated monopoly

Monopoly that the government allows to exist legally

nonprice competition

a way to attract customers through style, service, or location, but not a lower price

price competition

emphasizing price as an issue and matching or beating competitors' prices

price discrimination

the business practice of selling the same good at different prices to different customers

To decrease its unit costs, Marti Mart has entered into long-term contracts with some of its vendors and has
agreed to buy in bulk. This is an example of

economies of scale.

economies of scale

factors that cause a producer's average cost per unit to fall as output rises

Collette wants to fill out at least five job applications this week. What standard has she set for her success?

An objective measure

marginal cost

the cost of producing one more unit of a good

tying agreement

An agreement by a party to sell one product but only on the condition that the buyer also purchases a different (or tied) product, or at least agrees he will not purchase the product from any other supplier.

law of diminishing returns

the principle that, at some point, adding more of a variable input, such as labor, to the same amount of a fixed input, such as capital, will cause the marginal product of the variable input to decline

Associations with color are a cultural sensitivity issue that is most important for

businesses.

When selling your ideas to others, objections typically signify that

the audience is taking your idea seriously.

Internal and external controls, policies, and guidelines for reaching goals while meeting stakeholders' needs are
all common elements of

corporate governance structures.

corporate governance structures

determines the distribution of rights and responsibilities between the different parties in the organization and sets the decision-making rules and procedures

What is the first step in entrepreneurial discovery?

Identifying an unmet want or need

The founder of a startup should think about hiring employees when they are

turning down work due to limited capacity.

Which of the following questions would Allison ask herself when deciding if she should hire an assistant for her
growing business:

Does the workload require a full-time or part-time employee?

Which of the following is an example of a capital resource:

Conveyer belt

capital resources

The tools, equipment, and buildings that are used to produce goods and services

When should an entrepreneur start plotting their exit strategy?

When writing the business plan

When trying to raise capital, an existing business that is owed a large amount of money as accounts receivable
may turn them into cash by selling them to a(n)

factor.

Which of the following is true of income statements:

They typically have at least five categories.

The main five categories of a business's income statement are:

revenue, cost of goods sold/cost of sales, gross profit, operating expenses, and net income/profit

Rebuilding the budget for each new budgeting period is a strategy known as __________ budgeting.

zero-based.

Zero-based budgeting

a budgeting approach in which each department starts from zero every year and must justify every item in the budget, rather than simply adjusting the previous year's budget amounts

long-term budgeting

Planning spending over a relatively long period of time in order to meet financial goals.

Fixed budgeting

expenditures and revenues are projected on a monthly basis, thereby providing an estimate of cash flow; most appropriate for large, well-established sports medicine clinics during economic certainty

incremental budgeting

allocates increased or decreased funds to a department by using the last budget period as a reference point; only incremental changes in the budget request are reviewed

Which of the following is a component of a profit-and-loss statement:

Gross margin

Gross Margin

the amount of money the retailer makes as a percentage of sales after the cost of goods sold is subtracted

Book Value

the difference between the cost of a depreciable asset and its related accumulated depreciation

petty cash

an amount of cash kept on hand and used for making small payments

Which of the following methods of financial analysis displays all information as percentages and is particularly
useful for comparing companies within their industries:

Common-sized statements

Common-sized statements

all items are expressed as percentages with no dollar amounts shown

Vertical analysis

reporting an amount on a financial statement as a percentage of another item on the same financial statement

horizontal analysis

analysis of financial statements that compares account values reported on these statements over two or more years to identify changes and trends

Trend analysis

hypothetical extension of a past series of events into the future

Which of the following can legally be asked on a job application:

Military experience

Why should a manager seek employee input when considering solutions to an employee complaint?

Employees may already have a solution to the problem.

Which of the following is a true statement about the effects of remedial action:

The results of punishing undesirable behavior are unpredictable.

Which of the following is an example of how sales promotion tactics can impact marketing goals:

Samuel purchases a new car after viewing a commercial.

What is a potential strength that a manager might identify in a SWOT analysis?

Market leadership

SWOT analysis

strengths, weaknesses, opportunities, threats

When creating a quality assurance program, it is important that a manager first

creates standards.

How can a business sell more goods to increase profit quickly but do so without increasing expenses?

Set lower prices

Which of the following provides the most economical way for a new business to obtain office space if it has
limited cash flow:

Pay a $2,000 security deposit to lease a facility

An operations manager must determine the sequence materials will take through the production process. This
activity is known as

routing.

Improved performance, reduced costs, increased profitability, and competitive advantage are most likely to be
reasons why a business may choose to engage in

business process change.

Which of the following is a top priority for supply chain managers:

Controlling costs

Bernard's business is more successful than his competitors' because he is innovative, which gives him a

competitive advantage.

Which of the following statements accurately describes the relationship between ethics and corporate
governance:

Corporate governance seeks to minimize unethical behavior, reduce risk, and avoid mismanagement.

What is the relationship between shareholders and the board of directors?

The board of directors represents the shareholders.

board of directors

a group of persons elected by the stockholders to manage a corporation

Which of the following is a profit-oriented pricing objective:

Earning return on investment

Which element of the promotional mix is being used by a business that builds a display to show a new line of
products?

Sales promotion

What do many businesses often use to promote products and increase awareness?

Public relations activities

A risk management program helps __________ risk, which makes it easier to organize and handle.

categorize

What is an example of a broad goal that management might develop for a business?

Reduce operating expenses

Which of the following is a promotion-related question that a business might ask to adjust its marketing mix in
response to environmental changes:

What laws affect our advertising?

Which of the following best describes the relationship between learning and innovation:

The ability to learn is essential for innovation.

The ADKAR model, which stands for Awareness, Desire, Knowledge, Ability, and Reinforcement, is a strategy
that businesses use for

change management.

Economies of scale are highly dependent on average

total cost

Which of the following statements regarding international trade is true:

Internet-based companies can easily become involved in international trade.

One factor that an entrepreneur should consider when assessing a venture opportunity is whether it will

satisfy vendors' needs.

feasibility study

an assessment of the practicality and potential for success of a proposed business idea

Incorporation Fees

The fee you must pay to the state or government to corporate a business.

Evan does not want the legal obligation of repaying a loan and is willing to share profits with others.
Which of the following options is Evan most likely to select to fund a new venture:

Private equity

Private Equity

investments in companies that are not traded on a stock exchange

Community bank

type of commercial bank that is locally owned and operated

Collateral savings

Collateral is a property or other asset that a borrower offers as a way for a lender to secure the loan.

trade credit

the practice of buying goods and services now and paying for them later

Small-business owners often obtain ideas for new venture opportunities when they

talk with their customers and vendors.

When Deanna, a small-business owner, allocates 6% of her company's profit to product development, she is investing which type of resource:

Financial

A car company has decided to invest less in its successful pickup truck and to use those funds instead on the development of its new hybrid vehicle. This is an example of

a harvest strategy

Harvest Strategy

A corporate-level strategy through which a company seeks to gain short-term profits while phasing out a product line or exiting a market

Which of the following presents the first three steps in the accounting cycle in the correct order:

Analyze, journalize, and post

Le' Grand Hotel experienced record profits and chose to reinvest those profits back into the hotel for a major remodeling project. Where would these retained earnings be represented on a balance sheet?

Under stockholders' equity

When a business seeks to establish a budget or make major business decisions, what type of accounting does it use?

Managerial accounting

Managerial accounting

accounting used to provide information and analyses to managers inside the organization to assist them in decision making

financial accounting

accounting information and analyses prepared for people outside the organization

Forensic Accounting

An area of accounting that uses accounting, auditing, and investigative skills to conduct investigations into theft and fraud.

Internal auditing

An independent, objective assurance and consulting activity designed to add value and improve an organization's operations

A small restaurant wants to expand, but first it needs to raise funds. John wants to raise capital through debt financing, but his partner, Damien, isn't sure that's a good idea. What is one downside of debt financing that Damien could cite to prove his point to John?

They will have to pay interest on the borrowed amount.

Which of the following is an intangible benefit that might be included in a cost-benefit analysis:

Increased convenience

cost-benefit analysis

a study that compares the costs and benefits to society of providing a public good

The CEO of a medium-sized business asked the top five executives to each prepare a sales forecast for the upcoming year. The forecasts were then averaged together to get the composite forecast. What method of forecasting was used?

Jury of executive opinion

Jury of executive opinion

a forecasting technique that uses the opinion of a small group of high-level managers to form a group estimate of demand

Sales force composite

a forecasting technique based on salespersons' estimates of expected sales

The Delphi technique

A decision-making technique in which group members do not meet face-to-face but respond in writing to questions posed by the group leader.

Survey of buyer intentions

a sample of current or potential customers are asked how much of a particular product they would buy at a given price during a specified future time period

Which of the following equations should employees know when they are verifying the accuracy of a
business's balance sheet:

Assets = Owner's Equity - Liabilities

The marketing function that includes creating strategies to attract the target customer to a business is

marketing-information management.

Company B's management has determined that it must downsize. Three persons in the customer service department will lose their jobs. Which of the following records can management use to help them determine which employees to keep:

Human resources records