Small Business Management Exam Review
Course Introduction
Small Business Management explores the principles and practices essential for launching, operating, and growing a small business. The course covers topics such as entrepreneurship, business planning, funding options, marketing strategies, financial management, operations, legal considerations, and the unique challenges faced by small enterprises. Students will analyze real-world case studies, develop business plans, and gain insights into decision-making processes that drive success in small business environments. This course equips learners with practical skills and knowledge to effectively manage and sustain a small business in a competitive marketplace.
Recommended Textbook
Entrepreneurship Theory Process and Practice 9th Edition by Donald F. Kuratko
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15 Chapters
1181 Verified Questions
1181 Flashcards
Source URL: https://quizplus.com/study-set/1181
Page 2
Chapter 1: Entrepreneurship: Evolutionary
Development-Revolutionary Impact
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95 Verified Questions
95 Flashcards
Source URL: https://quizplus.com/quiz/23339
Sample Questions
Q1) Characteristics of entrepreneurs can neither be taught nor learned.
A)True
B)False Answer: False
Q2) The financial/capital entrepreneurial school of thought focuses on the potential profit of the business idea.
A)True
B)False
Answer: False
Q3) Michael Gerber, the author of The E-Myth, contends:
A) the entire field of study in entrepreneurship is a myth
B) there is no such thing as entrepreneurship
C) today's business owners are not True entrepreneurs
D) everybody in business is an entrepreneur
Answer: C
Q4) The displacement school of thought focuses on the negative side of group phenomena.
A)True
B)False Answer: True
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Chapter 2: The Entrepreneurial Mind-Set in Individuals:
Cognition and Ethics
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97 Verified Questions
97 Flashcards
Source URL: https://quizplus.com/quiz/23340
Sample Questions
Q1) Entrepreneurs are pessimists who see the cup half empty, rather than half full.
A)True
B)False
Answer: False
Q2) Selfishness and a need for power are two characteristics common in entrepreneurs.
A)True
B)False
Answer: False
Q3) Entrepreneurs with a drive to achieve want to
A) compete.
B) watch others succeed.
C) take great risks.
D) control and dominate.
Answer: A
Q4) The entrepreneur is driven by a strong desire for control over their venture.
A)True
B)False
Answer: True
Page 4
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Chapter 3: The Entrepreneurial Mind-Set in Organizations: Corporate Entrepreneurship
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85 Verified Questions
85 Flashcards
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Sample Questions
Q1) In order to develop an entrepreneurial environment, factors that organizations need to be aware of include:
A) management support and rewards
B) autonomy and time
C) business plans and inventions
D) a and b should be considered
Answer: D
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) Skunk works are project groups that work within the traditional lines of authority.
A)True
B)False
Answer: False
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Chapter 4: Social Entrepreneurship and the Global
Environment for Entrepreneurship
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50 Verified Questions
50 Flashcards
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Sample Questions
Q1) An account framework that goes beyond the traditional measures of profit, return on investment,and shareholder value to include environmental and social dimensions is called
A) the shared bottom line
B) the value proposition
C) the triple bottom line
D) the twin bottom line
Q2) Methods for going international include all of the following except A) importing
B) exporting
C) licensing
D) foreign reclamation
Q3) An L3C is a new legal form for social enterprises known as A) limited liability corporations
B) low-profit, limited liability companies
C) long-term, low-profit, low-liability companies
D) limited liability laborers
Q4) Resource-rich countries and market-rich countries are usually one and the same.
A)True
B)False
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Chapter 5: Innovation: The Creative Pursuit of Ideas
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95 Verified Questions
95 Flashcards
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Sample Questions
Q1) The phase of the creative process when the idea or solution the individual is seeking is discovered is the
A) background or knowledge accumulation.
B) incubation process.
C) idea experience.
D) evaluation and implementation.
Q2) The innovation process involves only the development of a good idea. A)True B)False
Q3) Extension is the combination of existing concepts and factors into a new formulation. A)True B)False
Q4) Creativity is most likely to occur when the "climate" is right. The text listed several important characteristics of this climate. What is the right climate?
Q5) The cognitive ability of entrepreneurs to acquire and transform information has yet to be studied. A)True B)False
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Chapter 6: Assessment of Entrepreneurial Opportunities
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82 Verified Questions
82 Flashcards
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Sample Questions
Q1) "Intensity of competition" changes the dominance of problem areas.
A)True
B)False
Q2) The results of a profile analysis enable the entrepreneur to judge
A) himself or herself.
B) the competition.
C) the potential of the business.
D) venture capital opportunities.
Q3) What sorts of legal issues can be overlooked when assessing an entrepreneurial opportunity?
Q4) Name the pitfall described by the statement, "Engineers and technically trained people are particularly prone to falling in love with an idea for a product or service."
A) inadequate understanding of technical requirements
B) lack of venture uniqueness
C) no real insight into the market
D) lack of objective evaluation
Q5) What are three critical factors in a new venture assessment?
Q6) What are the five specific feasibility phases that a new venture will go through?
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Chapter 7: Pathways to Entrepreneurial Ventures
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75 Verified Questions
75 Flashcards
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Sample Questions
Q1) When is the buyer likely to have power over the seller in the negotiation to purchase a business?
A) if the seller has already purchased another business
B) if potential buyers are numerous
C) if the buyer's backers wish to invest quickly
D) if the seller has no deadline for selling
Q2) Who must negotiate a final deal to purchase a business?
A) A lawyer
B) A CPA
C) The potential buyer
D) All of the above
Q3) Business-related reasons for selling may include all except:
A) trouble with suppliers.
B) changes in leasehold conditions.
C) changes in zoning that affect the business.
D) all of the above
Q4) The most important area to examine prior to purchasing a business is company profitability.
A)True
B)False
Page 9
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Chapter 8: Sources of Capital for Entrepreneurs
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86 Verified Questions
86 Flashcards
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Sample Questions
Q1) How many people in America have net worth in excess of $1 million?
A) less than 100,000
B) about 200,000
C) about 500,000
D) more than l,000,000
Q2) SEC stands for the
A) Stock Exchange Corporation.
B) Securities and Exchange Commission.
C) Standard Equity Commission.
D) Source of Equity Company.
Q3) The business plan is a critical element in a new-venture proposal.
A)True
B)False
Q4) 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.
Q5) What are the major types and uses of debt financing?
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Chapter 9: Legal Challenges of Entrepreneurial Ventures
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85 Verified Questions
85 Flashcards
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Sample Questions
Q1) The owner of a copyright may do all of the following except A) reproduce the work.
B) deduct the intrinsic value of the rights from one's taxes
C) perform the work publicly.
D) display the work publicly.
Q2) The two parts to a patent application are specification, and .
A) claims
B) percentage
C) value
D) perception
Q3) All of the following are recognized as advantages of partnerships except:
A) ease of formation
B) possible tax advantages
C) direct rewards
D) lack of continuity
Q4) Copyrights may be expressed in A) books.
B) periodicals.
C) motion pictures.
D) all of the above.
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Chapter 10: Marketing Challenges for Entrepreneurial Ventures
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77 Verified Questions
77 Flashcards
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Sample Questions
Q1) A marketing information system compiles and organizes data relating to _______ from the customer base.
A) price
B) revenue
C) demand
D) supply
Q2) Products or services that consumers make a special effort to find and purchase are
A) convenience goods
B) shopping goods
C) specialty goods
D) generic goods
Q3) A consumer driven marketing philosophy often relies on direct selling.
A)True
B)False
Q4) Social media marketing is the application of online collaborative media for marketing purposes.
A)True
B)False
Q5) What types of research questions might be asked about a firm's advertising?
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Chapter 11: Financial Preparation for Entrepreneurial Ventures
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78 Verified Questions
78 Flashcards
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Sample Questions
Q1) Financial information pulls together all the information presented in the other segments of the business.
A)True
B)False
Q2) The last step in preparing the operating budget is to
A) estimate current sales.
B) estimate operating expenses.
C) estimate variable costs.
D) estimate R & D costs.
Q3) The pro forma income statement is prepared before the pro forma balance sheet.
A)True
B)False
Q4) Ratio analysis can be applied from which of the following directions?
A) vertical only
B) vertical and horizontal
C) horizontal only
D) external and internal
Q5) List the elements of a capital budget and define its main objective.
Q6) Explain what a cash flow budget tells a manager/owner.
Q7) Name and describe the final phase of the budget process. Page 13
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Page 14
Chapter 12: Developing an Effective Business Plan
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81 Verified Questions
81 Flashcards
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Sample Questions
Q1) One of the benefits of a business plan for a financial source is that it forces the source to view the plan for miscalculations.
A)True
B)False
Q2) One thing that should be included in the business description is
A) the name of each investor.
B) industry background.
C) potential disadvantages of the venture.
D) a list of suppliers.
Q3) The pro forma balance sheet is used in the critical risk segment of the business plan.
A)True
B)False
Q4) Which of the following is not a critical factor that should be addressed in planning a venture?
A) milestones
B) flexibility
C) specific profit goals
D) realistic goals
Q5) What is the basic structure of a business plan?
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Chapter 13: Strategic Entrepreneurial Growth
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52 Verified Questions
52 Flashcards
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Sample Questions
Q1) 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
Q2) A "SWOT" analysis refers to analyzing strengths, weaknesses, opportunities, and threats.
A)True
B)False
Q3) Participation by subordinates in a strategic plan is never appropriate.
A)True
B)False
Q4) New ventures rarely exhibit a typical life cycle.
A)True
B)False
Q5) Research has shown that there is a distinct lack of strategic planning in new ventures. Relate some of the reasons for this lack of planning.
Q6) Most entrepreneurs are unfamiliar with planning information sources.
A)True
B)False
Page 16
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Chapter 14: Valuation of Entrepreneurial Ventures
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60 Verified Questions
60 Flashcards
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Sample Questions
Q1) An adjusted tangible book value method includes A) goodwill.
B) patents.
C) common price.
D) both a and b
Q2) List and describe the sources an entrepreneur should examine to find available business buying opportunities.
Q3) When considering sales and distribution, the entrepreneur should be concerned about
A) whether any sales are made on consignment.
B) how many sales are internal.
C) how sales vary with social demographics.
D) how many distributors are necessary.
Q4) Weaknesses in small closely held businesses call for careful analysis of the business being valued.
A)True
B)False
Q5) What should be considered in analyzing a business and what are some weaknesses of small business?
Q6) Explain the purpose of a letter of intent.
Page 17
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Chapter 15: Harvesting the Entrepreneurial Venture
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83 Verified Questions
83 Flashcards
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Sample Questions
Q1) Which of the following is not a step in developing a succession strategy?
A) identifying successor qualities
B) carrying out the succession plan
C) undertaking forcing events
D) understanding contextual aspects
Q2) An exit strategy is defined as that component of the business plan where an entrepreneur describes a method by which investors can realize a tangible return on their investment.
A)True
B)False
Q3) The harvest decision may come when the venture has grown to a stage where an IPO is a possibility.
A)True
B)False
Q4) One advantage of an early-entry strategy for the younger generation succeeding the older generation of a family business is
A) normal mistakes are viewed as incompetence.
B) perspective of the environment is broadened.
C) successor's skills are judged with more objectivity.
D) skills specifically required by the business are developed.
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