Entrepreneurship and Innovation
Textbook Exam Questions
Course Introduction
This course explores the foundational principles and practical aspects of entrepreneurship and innovation in modern business environments. Students will examine the process of identifying opportunities, developing creative solutions, and launching new ventures or products. Key topics include idea generation, business model development, market analysis, resource acquisition, and strategies for managing risk and uncertainty. Through case studies, interactive discussions, and hands-on projects, learners will gain an understanding of both the mindset and skills required to drive innovation and build successful entrepreneurial endeavors in a variety of industries.
Recommended Textbook
Entrepreneurship Theory Process and Practice 9th Edition by Donald F. Kuratko
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15 Chapters
1181 Verified Questions
1181 Flashcards
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Page 2
Chapter 1: Entrepreneurship: Evolutionary
Development-Revolutionary Impact
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95 Flashcards
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Sample Questions
Q1) Entrepreneurs are not heroes in today's marketplace.
A)True
B)False
Answer: False
Q2) There is no single definition of an entrepreneur.
A)True
B)False
Answer: True
Q3) Prepared entrepreneurs who seize opportunities when they arise often appear to be lucky.
A)True
B)False
Answer: True
Q4) Michael Gerber, the author of The E-Myth, explains that the failure of most small businesses is due to:
A) owners being more technical rather than entrepreneurial
B) owners being more managerial rather than technical
C) owners being more entrepreneurial rather than managerial
D) owners being more entrepreneurial rather than technical
Answer: A
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Chapter 2: The Entrepreneurial Mind-Set in Individuals:
Cognition and Ethics
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Sample Questions
Q1) Which of the following is a False statement about entrepreneurs?
A) They burn with the competitive desire to excel.
B) They see the cup half full rather than half empty.
C) They do not use failure as a tool for learning.
D) They are achievers.
Answer: C
Q2) The Greek thinker, Chilon, felt that a merchant does better to take a loss than to make a dishonest profit.
A)True
B)False
Answer: True
Q3) The need to achieve can be a source of stress for entrepreneurs.
A)True
B)False
Answer: True
Q4) Successful entrepreneurs fear failure the same way all people do.
A)True
B)False
Answer: False
Page 4
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Chapter 3: The Entrepreneurial Mind-Set in Organizations: Corporate Entrepreneurship
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85 Flashcards
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Sample Questions
Q1) Corporations that promote personal growth will attract the best people.
A)True
B)False
Answer: True
Q2) One reason why corporate entrepreneurship has done so well is that it allows organizations to
A) increase salaries.
B) fire the dead wood.
C) encourage high risk taking.
D) tap the innovative talents of their people.
Answer: D
Q3) In restructuring corporate thinking, top management should
A) identify potential entrepreneurs after an innovation program is in operation.
B) make the entrepreneur follow strict corporate guidelines.
C) promote entrepreneurship through experimentation.
D) create diversity and order in strategic activities.
Answer: C
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Page 5
Chapter 4: Social Entrepreneurship and the Global
Environment for Entrepreneurship
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Sample Questions
Q1) International alliances rarely require the exchange of proprietary knowledge.
A)True
B)False
Q2) Thanks to the North American Free Trade Agreement, among the largest U.S. trading partners are China and Brazil.
A)True
B)False
Q3) Social entrepreneurs are known to combine resources to exploit opportunities to create social value.
A)True
B)False
Q4) Which of the following designations is not synonymous with social entrepreneur?
A) social innovator
B) public entrepreneur
C) civic entrepreneur
D) social impersonator
Q5) Social entrepreneurship is rarely a vehicle for sustainable development.
A)True
B)False
Q6) Why is global thinking important to today's entrepreneurs? Page 6
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Page 7
Chapter 5: Innovation: The Creative Pursuit of Ideas
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Sample Questions
Q1) The incubation process involves which of the following?
A) working harder
B) letting the subconscious work
C) talking with friends
D) changing jobs
Q2) Most successful innovations are
A) simple and focused.
B) complex and focused.
C) focused and extensive.
D) complex and extensive.
Q3) The creative climate rejects the ambiguity common in work and life.
A)True
B)False
Q4) Creativity, in the entrepreneurial context, is the generation of ideas that result in the improved efficiency or effectiveness of a system.
A)True
B)False
Q5) Innovation is planned and predictable.
A)True
B)False
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Chapter 6: Assessment of Entrepreneurial Opportunities
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Sample Questions
Q1) Failure of a new venture can be avoided
A) by being a high-risk taker.
B) through a careful profile analysis.
C) through both a and c
D) through none of the above.
Q2) An approach developed as a criteria selection list from which entrepreneurs can gain insights into the viability of their venture is the
A) feasibility criteria approach.
B) time-essence of a venture approach.
C) marketability feasibility approach.
D) comprehensive feasibility approach.
Q3) Many entrepreneurs do not understand the marketing life cycle of a new product.
A)True
B)False
Q4) Solid analysis and evaluation of the feasibility of the product/service idea are critical tasks in starting a new business.
A)True
B)False
Q5) What are three critical factors in a new venture assessment?
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Chapter 7: Pathways to Entrepreneurial Ventures
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Sample Questions
Q1) Much franchise litigation has arisen over termination of owners.
A)True
B)False
Q2) The individual who buys the franchise is the A) franchisee.
B) franchisor.
C) franchisette.
D) franchatter.
Q3) Franchisees have the option of using the logo and symbols of the franchisor.
A)True
B)False
Q4) The final decision to purchase a franchise should be up to A) your lawyer.
B) your financial backer.
C) you.
D) your accountant.
Q5) Sales records are of very little value to a buyer in evaluating a company's worth.
A)True
B)False
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Chapter 8: Sources of Capital for Entrepreneurs
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Sample Questions
Q1) Criteria that venture capitalists use in evaluating new venture proposals include:
A) the entrepreneur's education.
B) the entrepreneur's travel expenses.
C) the characteristics of the product or service.
D) when they will be paid back in full.
Q2) Which is one of the most important questions for entrepreneurs to ask regarding venture capitalists?
A) What is it like to work with their firm?
B) Are they good communicators?
C) Are they wealthy?
D) Are they good at financial computation?
Q3) SEC stands for the
A) Stock Exchange Corporation.
B) Securities and Exchange Commission.
C) Standard Equity Commission.
D) Source of Equity Company.
Q4) There is only a small number of informal risk capitalists in the market today.
A)True
B)False
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Chapter 9: Legal Challenges of Entrepreneurial Ventures
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Sample Questions
Q1) According to the U.S. Patent Office, the process of obtaining a patent takes how many months?
A) about 24 months
B) about 36 months
C) about 48 months
D) about 60 months
Q2) A person who loses an infringement battle in court may have to pay
A) extra legal fees.
B) damages of up to five times the actual amount.
C) higher profits due to the infringement.
D) the taxpayers back.
Q3) A typical symptom of impending bankruptcy failure is when
A) new competition exits the market.
B) other firms seem to be selling products that are a generation ahead.
C) retailers always seem to be understocked.
D) the entrepreneur seeks to exit the market.
Q4) Identify the three major sections of the Bankruptcy Act.
Q5) What are the rules for avoiding pitfalls in selecting trademarks?
Q6) What does a copyright protect?
Q7) What are the uses of trademarks and how can they be invalidated?
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Chapter 10: Marketing Challenges for Entrepreneurial Ventures
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Sample Questions
Q1) Which of the following influences the choice of marketing philosophy?
A) competitive pressure
B) economic outlook
C) Dow Jones Industrial averages
D) cost of living index
Q2) Explain the new marketing concept?
Q3) What is skimming and what are its effects?
Q4) What is skimming?
A) setting price to maximize profit
B) setting price to maximize market share
C) setting price to switch customers to new product lines
D) setting price to match the competition
Q5) Which of the following is not a method of collecting primary data?
A) review of government publications
B) telephone
C) mail survey
D) observation
B)False Page 13
Q6) Marketing information that has already been compiled is known as secondary data. A)True
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Page 14
Chapter 11: Financial Preparation for Entrepreneurial Ventures
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Sample Questions
Q1) It is typical for a firm to prepare an operating budget but not a cash budget.
A)True
B)False
Q2) Production requirements are figured by subtracting the period's beginning inventory from
A) inventory from the previous period.
B) inventory needed for that period.
C) both of the above.
D) fixed costs.
Q3) The first step in the preparation of the cash flow budget is the A) identification of cash inflows.
B) identification of cash outflows.
C) identification and timing of cash inflows.
D) identification and timing of cash outflows.
Q4) Capital budgeting is designed to show A) how many projects, in total, should be selected.
B) which project is most profitable.
C) which of several mutually exclusive projects should be selected
D) how to evaluate projects based on rates of return.
Page 15
Q5) Explain what a cash flow budget tells a manager/owner.
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Chapter 12: Developing an Effective Business Plan
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Sample Questions
Q1) The entrepreneur should expect to encounter a friendly and supportive audience when presenting the business plan to potential financial sources.
A)True
B)False
Q2) Which of the following statements is not part of the "five-minute reading" by venture capitalists?
A) Determine the characteristics of the venture and industry.
B) Determine the strengths and weaknesses of the entrepreneur.
C) Determine the financial structure of the plan.
D) Read the latest balance sheet.
Q3) The completed business plan provides the entrepreneur with A) a tool for communicating with financial sources.
B) a sense of well-being.
C) a product-launch timetable.
D) a nicely designed booklet.
Q4) An entrepreneur is much better off preparing his or her own business plan rather than hiring someone else, even if more experienced, to prepare it.
A)True
B)False
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Chapter 13: Strategic Entrepreneurial Growth
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Sample Questions
Q1) The entrepreneurial strategy matrix measures risk and innovation.
A)True
B)False
Q2) Formation of long-range plans for effective management in light of a venture's strengths and weaknesses is referred to as
A) dimensional planning.
B) tactical planning.
C) strategic planning.
D) operational planning.
Q3) Analysis of a firm's external and internal environments provides the firm with the information to develop
A) a degree of uncertainty
B) administrative experience
C) competitive strengths
D) strategic intent and strategic mission
Q4) Which is not perceived as a difficulty in long-range planning?
A) arranging vacation time
B) inadequately defined objectives
C) poor planning climate
D) inexperienced managers
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Chapter 14: Valuation of Entrepreneurial Ventures
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Sample Questions
Q1) When Facebook went public in May of 2012, what was its starting valuation?
A) more than $10 billion but less than $50 billion
B) more than $50 billion but less than $100 billion
C) more the $100 billion but less than $150 billion
D) more than $150 billion
Q2) When a company is liquidated, preferred stockholders received a certain fixed amount after assets are distributed to common stockholders.
A)True
B)False
Q3) "Why is the business being sold?" is not an important question to ask when analyzing the viability of buying a business.
A)True
B)False
Q4) Tangible assets as well as intangible assets of a business need to be assessed for proper venture evaluation.
A)True
B)False
Q5) What should be considered in analyzing a business and what are some weaknesses of small business?
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Chapter 15: Harvesting the Entrepreneurial Venture
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Sample Questions
Q1) Which of the following is not an example of pressures or interests from within a firm that affect succession issues?
A) rivalry among various branches of the family
B) pressure from a family member to start his/her own business
C) employee wanting a percentage of the business in the owner's will
D) pressure on the owner/manager to designate an heir
Q2) Once the decision is made to harvest the business, the way forward is easy.
A)True
B)False
Q3) Loss of ownership control is often attributable to one of the Four Ds: disability, death, dissolution, and debtorship.
A)True
B)False
Q4) The harvest decision may come when the venture has grown to a stage where an IPO is a possibility.
A)True
B)False
Q5) What are the four critical steps to consider in developing a succession strategy in a family business?
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