Building Networks And Foundations Ch.12 Complete Test Bank

Chapter 12: Building Networks and Foundations

= Correct answer

Multiple Choice/Fill in the Blank

1. Which of the following best defines networking from an entrepreneur’s perspective?

A. exchanging information and services among groups and institutions

B. finding and establishing relationships with business professionals

C. interacting with people on a variety of virtual social networks

D. meeting people who might be useful to know in your career

Difficulty: Easy

1. According to the text, how should you present yourself to people who might be part of your network?

A. as a colleague

B. as an expert

C. as a friend

D. as a salesperson

Difficulty: Easy

1. Which of the following is an example of a college or university special interest group?

A. Alumni Association

B. Botany-Microbiology Club

C. Sigma Alpha Epsilon

D. Working-Class Studies Association

Difficulty: Moderate

1. Which of the following is a characteristic of active members of alumni associations, according to the text?

A. activism

B. conformity

C. loyalty

D. wealth

Difficulty: Easy

1. Which of the following is an example of a closed group?

A. American Association of University Women

B. Amnesty International

C. Environmental Working Group

D. MoveOn

Difficulty: Moderate

1. According to the text, which of the following is characteristic of an effective group?

A. domination of a leader

B. formal legal structure

C. impulsivity

D. restricted communication

Difficulty: Moderate

1. Which of the following is an example of a trade association?

A. Congressional Leadership Fund

B. Environmental Defense Fund

C. Glass Packaging Institute

D. National League of Cities

Difficulty: Moderate

1. Which of the following makes business accelerators different from business incubators?

A. Business accelerators make equity investments in their members’ companies.

B. Business accelerators provide office space and shared facilities.

C. Business accelerators have experts who can provide advice and mentoring.

D. Business accelerators allow entrepreneurs to stay for long periods of time.

Difficulty: Difficult

1. Which of the following is a micro-level purpose of the Small Business Administration?

A. defend competition

B. direct counseling

C. fortify the national economy

D. safeguard small business

Difficulty: Moderate

1. Which of the following describes a macro-level function of the Small Business Administration?

A. facilitate public-private partnerships with other institutions

B. help people start, build, and grow their small businesses

C. protect and defend a competitive business environment

D. provide direct counseling to new business owners

Difficulty: Easy

1. In order to qualify for a Service-Disabled Veteran-Owned Small Business Concern program, which of these requirements must be met?

A. direct ownership and control of 21 percent of the business

B. direct ownership and control of 51 percent of the business

C. direct ownership and control of 71 percent of the business

D. direct ownership and control of 100 percent of the business

Difficulty: Easy

1. NFL quarterback Tom Brady, MLB pitcher Nolan Ryan, and medical news reporter and neurosurgeon Dr. Sanjay Gupta all agree that ________ is vital to entrepreneurial success.

A. business degree

B. intelligence

C. luck

D. teamwork

Difficulty: Easy

1. Accountants can help entrepreneurs create a ________ that shows how much and where monies will be collected and spent in the early stages of the business.

A. pro bono

B. pro forma

C. pro rata

D. pro se

Difficulty: Easy

1. Which of the following is an example of a capital improvement?

A. building an addition

B. installing carpet

C. painting the walls

D. repairing a roof leak

Difficulty: Difficult

1. Ms. O’Sullivan is just starting her business, and she needs an attorney to help her with a variety of services. If she wants to save money, which type of attorney is her best choice?

A. civil litigation

B. general practice

C. personal injury

D. workers compensation

Difficulty: Moderate

1. According to the text, which of these mindsets is challenging to leave behind as a new entrepreneur?

A. business

B. employee

C. fear

D. social

Difficulty: Moderate

1. Tamara started a business selling fair trade clothing. Her business has recently expanded from her small town to several larger cities in the state. Which of these statements best describes how her banking needs have evolved?

A. She opened an account with a small bank and moved to a large bank.

B. She opened an account with a large bank and moved to a small bank.

C. She opened an account with a small bank and continued to stay with the small bank.

D. She opened an account with a large bank and continued to stay with the large bank.

Difficulty: Moderate

1. Which of the following best describes a role of an advisory team?

A. explain options and risks

B. hire and fire employees

C. mentor managers

D. raise money for capital

Difficulty: Moderate

1. In the 2001 film Ocean’s Eleven, a team is organized for a casino heist. The team members include a con man, a pickpocket, an acrobat, and an explosives expert. Which of these characteristics best explains the high effectiveness of the team?

A. cross-disciplinary

B. project

C. self-directed

D. special purpose

Difficulty: Moderate

1. The ________ type of organizational structure works best when the environment is changing rapidly, the members of the organization have a shared purpose, and there is a need for innovation.

A. divisional

B. flat

C. functional

D. matrix

Difficulty: Difficult

1. Which of the following is a characteristic of linear thinking?

A. creative

B. emotional

C. intuitive

D. logical

Difficulty: Easy

1. Which management consultant introduced scientific management techniques into manufacturing industries?

A. Peter Drucker

B. Henry Ford

C. Frederick Taylor

D. Jack Welch

Difficulty: Easy

1. The process of comparing what a business has done to what it can or should do is known as ________.

A. baselining

B. modeling

C. projecting

D. streamlining

Difficulty: Moderate

1. Which of the following happens when entrepreneurs compare their business with an industry average or a market segment?

A. benchmarking

B. correlating

C. juxtaposing

D. paralleling

Difficulty: Moderate

1. Engineers at a paper manufacturer designed a workstation so that the machine operator did not have to repeatedly reach too far while performing his work. The engineers used ________ to plan the design of the workstation.

A. ergonomics

B. fabrication

C. innovation

D. workflow

Difficulty: Moderate

True/False

1. True or false? Henry Ford was the first person to describe the division of labor that is used in Western economic models.

Difficulty: Moderate

1. True or false? Business accelerators allow entrepreneurs to stay for long periods of time.

Difficulty: Easy

1. True or false? The total cost of ownership of equipment needed to run a business includes the sticker price, delivery, installation, set-up, calibration, and operational expenses.

Difficulty: Difficult

1. True or false? An entrepreneur needs to purchase printer paper, ink, and other office supplies. These are included in capital expenses.

Difficulty: Easy

1. True or false? Juan is the owner of a widget shop. He tells a client that his machine can produce 1,000 widgets in an hour if the machine does not have to be resupplied with raw materials, cleaned, or shut down for repairs. Juan is referring to the machine’s operational capacity.

Difficulty: Difficult

1. True or false? A schedule of regularly planned maintenance that includes preventive repairs increases costs over the long term.

Difficulty: Moderate

1. True or false? A web development company has its employees do most of the work of the business. This is called self-management.

Difficulty: Moderate

1. True or false? Outsourcing work to contractors is a preferred method of getting sales work completed if the organization is under financial strain.

Difficulty: Difficult

1. True or false? A leader ensures that employees will perform assigned duties as expected.

Difficulty: Moderate

1. True or false? Employees work for leaders because they are obligated to on the basis of assigned roles.

Difficulty: Moderate

1. True or false? An effective leader is aware of his or her shortcomings and chooses employees who can compensate for those shortcomings.

Difficulty: Easy

1. True or false? A person with an internal locus of control believes that they have significant control and influence over events in their life.

Difficulty: Easy

1. True or false? Autocratic leadership works well if the organization or industry is complex.

Difficulty: Moderate

1. True or false? The first questions entrepreneurs need to ask themselves are: When can I take my company public? When can I obtain a patent?

Difficulty: Moderate

1. True or false? Only 5 to 30 percent of new products are successful.

Difficulty: Easy

Short Answer

1. While you were in college, you developed a new device that you would now like to market as an aspiring entrepreneur. A small business consultant has told you to develop a network of business professionals who can help you. Describe three of the places you would go to find people who might be able to help you develop your business.

Difficulty: Difficult

1. Describe at least two differences between a business incubator and a business accelerator.

Difficulty: Easy

1. What benefits can nonprofit organizations like SCORE offer aspiring entrepreneurs?

Difficulty: Easy

1. Describe one of the government programs funded by or partnered with the Small Business Administration and explain how it can help aspiring entrepreneurs.

Students may also describe the Service Corps of Retired Employees, which partners retired executives with aspiring small business owners; Small Business Development Centers, which are often connected to colleges and universities; the Veteran’s Business Outreach Center, which assists veterans and their families in starting and operating small businesses; or a HUBZone, which assists aspiring entrepreneurs in areas that have historically low employment.

Difficulty: Moderate

1. You and a partner are starting a small business in your hometown. Describe three members of your startup dream team, along with some of the things you would need those members to do.

Difficulty: Difficult

1. Describe three suggestions the text makes regarding the selection of your dream team of advisors.

Difficulty: Moderate

1. You are considering adding a personality assessment to your employee hiring process. Your dream team advisory board has advised you against it. Make an argument for or against using a personality assessment and support your argument with reasoning.

Students may argue in favor of personality assessments because they allow employers to assess whether a candidate will work effectively with other team members.

Difficulty: Difficult

1. Describe how a cross-disciplinary team benefits both the team members and the employers.

Difficulty: Moderate

1. Why do entrepreneurs need both linear and nonlinear thinkers among their advisors and employees?

Difficulty: Moderate

1. Describe the benefits of performing a baseline study.

Difficulty: Moderate

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