Business Planning
Exam Questions
Course Introduction
Business Planning is a comprehensive course designed to guide students through the process of developing effective business plans for new ventures or existing enterprises. The course covers essential elements such as market analysis, competitive strategies, financial forecasting, operational planning, and risk management. By engaging in case studies and practical exercises, students learn to structure and present their business ideas clearly, anticipate challenges, and devise actionable strategies for growth. The skills gained in this course are essential for aspiring entrepreneurs, managers, and anyone interested in turning innovative ideas into successful business operations.
Recommended Textbook
Entrepreneurship Successfully Launching New Ventures 3rd Edition by Bruce R. Barringer
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15 Chapters
1125 Verified Questions
1125 Flashcards
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Page 2
Chapter 1: Introduction to Entrepreneurship
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Sample Questions
Q1) A firm's ________ is a plan for how it competes, uses its resources, structures its relationships, interfaces with customers, and creates value to sustain itself on the basis of the value it creates
A) business plan
B) business model
C) tactical model
D) strategic plan
E) operations model
Answer: B
Q2) Which of the following is not one of the four steps of the entrepreneurial process?
A) deciding to become an entrepreneur
B) determining how to seize the spotlight
C) developing successful business ideas
D) moving from an idea to an entrepreneurial firm
E) managing and growing the entrepreneurial firm
Answer: B
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Chapter 2: Recognizing Opportunities and Generating Ideas
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Sample Questions
Q1) Describe how brainstorming can help facilitate the generation of ideas, and outline the four rules for conducting a brainstorming session.
Answer: Brainstorming is a technique that is used to generate a number of ideas quickly.Among the purposes a brainstorming session could be used for,is the generation of new business,product,or service ideas.
In a brainstorming session,the leader of the group of people is instructed to come up with ideas.One person shares an idea,another person reacts to it,another person reacts to the reaction,and so on.A flip chart is typically used to record all the ideas.A productive session is freewheeling and lively.The main objective is to create an atmosphere of enthusiasm and originality where lots of ideas are generated.The four strict rules of brainstorming are as follows:
1.No criticism is allowed.
2.Freewheeling is encouraged; the more ideas,the better.
3.The session moves quickly,and nothing is permitted to slow down the pace.
4.Leapfrogging is encouraged.This means using one idea as a means of jumping forward quickly to other ideas.
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Page 4
Chapter 3: Feasibility Analysis
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Sample Questions
Q1) John Kite is investigating the feasibility of a new type of electronic game targeting middle school and high school-age boys. Which of the following is an example of "gumshoe research" that John could conduct to get a sense of the likely demand for his game?
A) Leaf through several electronic games industry trade journals.
B) Administer a buying intentions survey.
C) Administer a concept test.
D) Look at the Web sites of a number of companies that sell electronic games.
E) Spend several days in electronic games arcades and stores to observe the types of games that attract the interest of middle school age and high school age boys.
Answer: E
Q2) Which of the following is not a part of assessing the product/service feasibility of a business idea?
A) buying intentions survey
B) gumshoe research
C) library research
D) assessment of total start-up cash needed
E) concept test
Answer: D
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Page 5
Chapter 4: Writing a Business Plan
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Sample Questions
Q1) According to the textbook, in the first meeting investors typically focus on whether the management team has the skills and experience to pull off the venture and:
A) whether the new venture is properly structured
B) whether the new venture has intellectual property
C) legal and tax issues
D) whether a real opportunity exists
E) industry and competitor analysis
Q2) A ________, in a business plan context, is a noteworthy event in the past or future development of a business.
A) aspiration
B) intention
C) signpost
D) milestone
E) target
Q3) There are two primary audiences for a firm's business plan: a firm's employees and investors and other external stakeholders.
A)True
B)False
Q4) What is a business plan?
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Chapter 5: Industry and Competitor Analysis
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Sample Questions
Q1) Which of the following was not identified in the textbook as a nontraditional barrier to entry?
A) first mover advantage
B) unique business model
C) product differentiation
D) strength of management team
E) Internet domain name
Q2) In the beverage industry, soda, fruit juice, and sports drinks are ________ competitors of bottled water.
A) occasional
B) infrequent
C) indirect
D) direct
E) future
Q3) The first step in a competitor analysis is to determine who the competition is.
A)True
B)False
Q4) Discuss the nontraditional barriers to entry identified in the chapter. Why is it important that entrepreneurial firms utilize one or more of these forms of barriers to entry?
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Chapter 6: Developing an Effective Business Model
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Sample Questions
Q1) Briefly describe the four main components of a business model. Identify the subcomponents of each the four main components of a business model.
Q2) In the WebHouse example included in Chapter 6, WebHouse failed because:
A) it did not complete a feasibility analysis
B) it did not write a complete business plan
C) it couldn't motivate its suppliers or customers to participate at a sufficient scale to support the overhead of the business
D) it charged too much for its services
E) it failed to focus on developing a core strategy
Q3) A ________ is a firm's plan or diagram for how it competes, uses its resources, structures its relationships, interfaces with customers, and creates value to sustain itself on the basis of the profits it earns.
A) feasibility model
B) business model
C) strategic plan
D) business plan
E) competitive model
Q4) Why is it important for a firm to have a well-thought-out business model?
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Page 8
Chapter 7: Preparing the Proper Ethical and Legal Foundation
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Sample Questions
Q1) A ________ is a formal statement of an organization's values on certain ethical and social issues.
A) code of conduct
B) code of behavior
C) code of performance
D) code of principles
E) code of morals
Q2) A separate legal entity organized under the authority of a state is referred to as a:
A) limited partnership
B) conglomerate
C) general partnership
D) sole proprietorship
E) corporation
Q3) Which of the following statements is incorrect regarding sole proprietorships?
A) There is one owner.
B) Sole proprietor is in full control.
C) Business ends at the owner's death or loss of interest in the business.
D) Liquidity of the investment is high.
E) Money must be raised by the sole proprietor.
Page 9
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Chapter 8: Assessing a New Venture's Financial Strength and Viability
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Sample Questions
Q1) According to the textbook, the most practical way to interpret or make sense of a firm's historical financial statements is through:
A) profit analysis
B) regression analysis
C) the preparation of pro forma financial statements
D) ratio analysis
E) percentage analysis
Q2) Match the financial term with its proper definition.
A) forecasts/depict relationships between items on a firm's financial statements
B) forecasts/written report that quantitatively describes a firm's financial health
C) budgets/itemized forecasts of a company's income, expenses, and capital needs
D) financial ratios/written report that quantitatively describes a firm's financial health
E) financial statements/an estimate of a firm's future income and expenses
Q3) What are forecasts? What role do they play in the preparation of pro form financial statements?
Q4) What is ratio analysis? Why is it important?
Q5) Describe each of the four primary financial objectives of firms.
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Chapter 9: Building a New Venture Team
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Sample Questions
Q1) SCORE is a for-profit organization that provides consulting services to small businesses.
A)True
B)False
Q2) Although a board of directors has formal governance responsibilities, its most useful role is to provide guidance and support to the firm's managers.
A)True
B)False
Q3) Studies show that more than one individual starts 50 to 70 percent of all new firms.
A)True
B)False
Q4) What is the difference between a heterogeneous and a homogeneous founding team? Which type of team has the advantage?
Q5) More people are willing to serve on a company's board of directors than board of advisors.
A)True
B)False
Q6) What is SCORE? What is its role in helping a firm fill out its new venture team?
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Chapter 10: Getting Financing or Funding
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Sample Questions
Q1) Which of the following statements is incorrect regarding equity funding?
A) Equity investors expect to get their money back, along with a substantial capital gain, through the sale of their stock.
B) Angel investors are a common source of equity funding.
C) Equity funding is not a loan.
D) Equity investors are very demanding.
E) Equity investors fund the majority of the plans they consider.
Q2) A brief carefully constructed statement that outlines the merits of a business opportunity is called an:
A) subway speech
B) sway speech
C) bootstrap speech
D) teaser speech
E) elevator speech
Q3) Approximately 20 percent of the 9,000 banks in the United States participate in the SBA Guaranteed Loan Program.
A)True
B)False
Q4) What is an elevator speech? How did it get its name?
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Chapter 11: Unique Marketing Issues
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Sample Questions
Q1) Some companies monitor the integrity of their brands through a program of:
A) brand administration
B) brand persistence
C) brand determination
D) brand resolution
E) brand management
Q2) Promotion is the only element in the marketing mix that produces revenue; all other elements represent costs.
A)True
B)False
Q3) A ________ is a place within a market segment that represents a narrower group of customers with similar interests.
A) position market
B) niche market
C) slot market
D) spot market
E) gap market
Q4) A firm's "position" is concerned with how it is situated relative to its rivals.
A)True
B)False
Page 13
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Chapter 12: The Importance of Intellectual Property
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Sample Questions
Q1) A utility patent is good for ________ from the date of the original application, a design patent is good for ________ from the date the patent is granted, and a plant patent is good for ________ from the date of the original application.
A) 14 years, 14 years, 20 years
B) 20 years, 20 years, 14 years
C) 20 years, 20 years, 20 years
D) 20 years, 14 years, 20 years
E) 14 years, 20 years, 14 years
Q2) Which of the following isn't an example of intellectual property?
A) Proactiv's formula for acne medication
B) Yahoo's trademark
C) the Internet domain name www.starbucks.com
D) Microsoft's Window operating system
E) a computer mouse
Q3) Which of the following symbols is the copyright bug?
A) ç
B)
C) ¢
D) ©
E)
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Chapter 13: Preparing for and Evaluating the Challenges of Growth
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Sample Questions
Q1) ________ means that as the number of employees a firm need increases, it becomes increasingly difficult for it to find the right employees, place them in appropriate positions, and provide adequate supervision.
A) Difficult hazard
B) Adverse hazard
C) Adverse selection
D) Moral selection
E) Moral hazard
Q2) According to Penrose, entrepreneurial services generate new market, product, and service ideas.
A)True
B)False
Q3) Market leadership occurs when a firm is one of the top ten firms in an industry or niche market in terms of sales volume.
A)True
B)False
Q4) Fixed costs are the costs a company incurs as it generates sales.
A)True
B)False
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Chapter 14: Strategies for Firm Growth
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Sample Questions
Q1) Internally generated growth is often called ________ growth because it does not rely on outside intervention.
A) natural
B) whole
C) expected
D) organic
E) ordinary
Q2) A ________ is an entity created when two or more firms pool a portion of their resources to create a separate, jointly owned organization.
A) strategic venture
B) strategic alliance
C) tactical venture
D) acquisition venture
E) joint venture
Q3) Licensing is the granting of permission by one company to another company to use a specific form of its intellectual property under clearly defined conditions.
A)True
B)False
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Chapter 15: Franchising
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Sample Questions
Q1) An area franchise agreement allows a franchisee to own and operate a specific number of outlets in a particular geographic area.
A)True
B)False
Q2) Clark Jensen recently opened a Planet Smoothie franchise. So far, he is very satisfied with Planet Smoothie because in exchange for an initial franchise fee and an ongoing royalty payment, Planet Smoothie has provided Clark a formula for doing business along with training, advertising, and other forms of assistance. Clark purchased a ________ franchise.
A) business extension
B) formula driven
C) sales extension
D) business format
E) product and trademark
Q3) One of the most important questions a prospective franchisor should consider is whether the fees and royalties charged by a franchisor are consistent with the franchise's value or worth.
A)True
B)False
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Page 17