Chapter 14 Professional Small Business Management Exam Prep - Small Business Competitive Advantage 7e Test Bank by Timothy S. Hatten. DOCX document preview.
Test Bank
Chapter 14: Professional Small Business Management
Multiple Choice
1. At work on a typical day, Kathleen, a sales manager, spends a portion of her day talking to customers and suppliers, but she also organizes work activities and leads a team of assistants. She has to ensure that quality standards are being met within the company. This example demonstrates that ______.
a. the functions of management are continuous and interrelated
b. leadership is the most important function of management
c. controlling is the most important function of management
d. the functions of management need to be delegated to a large pool of employees
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Reflective thinking
2. Organizing involves all but which of the following?
a. assembling financial resources
b. assembling human resources
c. assembling materials
d. assembling invoices
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
3. Leading, defined, is the process of getting the most ______ possible from the available ______.
a. work; employees
b. output; resources
c. profit; resources
d. resources; suppliers
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
4. Controlling, defined, is comparing what was initially ______ with what was actually ______.
a. received; bought
b. ordered; received
c. planned; accomplished
d. accepted; defined
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
5. Planning is ______ what to do.
a. thinking
b. pretending
c. organizing
d. determining
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
6. Management can be described as planning, leading, organizing, and controlling in order to achieve the ______ of the organization.
a. needs
b. goals
c. debts
d. financial well-being
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
7. Which of the following people were responsible for first articulating the four functions of management in 1916?
a. Henry Mintzberg
b. Henri Fayol
c. Henry Ford
d. Frederick Herzberg
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
8. Efficiency, defined, is ______.
a. making a high profit with low expenses
b. using all available resources to produce a high amount of output
c. accomplishing goals and tasks while making the most of the resources available
d. doing all tasks the right way the first time
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
9. Effectiveness, defined, is achieving which of the following?
a. stated goals
b. high profit
c. low expenses
d. growth
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
10. Within the ______ role of management, the manager needs to determine the direction of the company.
a. entrepreneur
b. resource allocator
c. monitor
d. leader
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Medium
TOP: AACSB Standard: Analytical thinking
11. One of Brandon’s primary roles on the production line is to continuously determine if quality control standards are being met. This relates to which managerial role?
a. entrepreneur
b. resource allocator
c. monitor
d. leader
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
12. Within the ______ role, the manager needs to identify fresh new ideas and innovations.
a. entrepreneur
b. resource allocator
c. monitor
d. leader
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
13. Connie’s consulting business has grown steadily over the course of four years. However, Connie recently has found that some of the jobs are not being completed on time, and there is more stress due to a greater reliance on partners and employees. Connie is most likely experiencing which of these?
a. owner’s fatigue
b. growing pains
c. exit strategy issues
d. resource maturity
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Reflective thinking
14. Signs of growing pains include all but which of the following?
a. jobs not delivered on time
b. costs that rise out of control
c. a feeling that chaos is ruling the business
d. inadequate building size
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
15. The ______ stage of growth involves the owner running the business alone.
a. existence
b. survival
c. success-disengagement
d. resource maturity
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
16. The ______ stage of growth involves the owner hiring other people.
a. existence
b. solo
c. survival
d. resource maturity
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
17. The ______ stage of growth involves the owner adding levels of supervision to lead departments or divisions.
a. formal organization
b. success-disengagement
c. takeoff
d. resource maturity
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
18. Gina’s Pizza has been in operation for three years, and the business has recently expanded to include multiple locations with a head manager at each location. Gina’s Pizza is most likely in which business growth stage?
a. survival
b. success
c. takeoff
d. resource maturity
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
19. During the ______ stage of business growth, the greatest concerns are to consolidate and control the finances and to professionalize the organization.
a. survival
b. success
c. takeoff
d. resource maturity
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
20. The best stage of growth is ______.
a. existence
b. success-disengagement
c. takeoff
d. no single stage is better than the other stages
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
21. According to an NFIB study, small business owners cited what as the most important problem that they face?
a. energy prices
b. cost of health insurance
c. governmental paperwork
d. locating qualified employees
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
22. Wendy has recently been approached by a Rita to sell her art gallery. Rita has been in the art business for over twenty years, but has never owned her own gallery. She tells Wendy that this has been one of her dreams since she was young. If Wendy sells the gallery to Rita, which exit option will she adopt?
a. take the company public
b. sell to a strategic buyer
c. sell to a financial buyer
d. sell to a key employee or group of employees
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
23. Bob Boyd is developing an exit strategy for his sporting goods business, since he plans to retire within the next three years. Bob knows that one of the company’s greatest strengths is that there is a core group of motivated employees who have been with the company for years. Based on this information, which exit strategy would be the best option for Bob?
a. sell to a strategic buyer
b. sell to a key employee or group of employees
c. take the company public
d. undertake a planned liquidation
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
24. The ______ approach to determining a company’s worth involves looking at what others have paid for comparable businesses.
a. asset-based
b. income
c. market
d. liability-based
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Medium
TOP: AACSB Standard: Analytical thinking
25. The ______ approach to determining a company’s worth involves the cost to recreate the operating assets of the business.
a. asset-based
b. income
c. market
d. liability-based
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
26. According to Jim Kouzes, the foundation of small business leadership is ______.
a. being authoritative
b. avoiding stressful situations
c. establishing a vision
d. being credible
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
27. Sandy owns and manages a retail establishment located near a busy waterfront. Her employees often describe Sandy as someone who believes in herself and is committed to accomplishing the company’s vision. Sandy’s style of leading can best be described by which leadership attribute?
a. written and oral communication ability
b. self-confidence and dependability
c. adaptability
d. creative ability
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
28. The person with a vision that cannot be put into action is a/an ______.
a. leader
b. follower
c. dreamer
d. employee
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
29. Vision can be defined as ______ of where the business is headed.
a. having a written plan
b. having a mental picture
c. having no clue
d. having goals
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
30. Written and oral communication, vision, creative ability, and ability to take action are all characteristics of a ______.
a. manager
b. leader
c. small business owner
d. president
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
31. Managers must occasionally make difficult choices or changes. The ability to make these choices or changes is known as ______.
a. an unsympathetic attitude
b. strength
c. toughness
d. an uncaring attitude toward employees
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
32. ______ can be defined as the communication process in which two or more people come together to seek mutual agreement about an issue.
a. Negotiation
b. Delegation
c. Vision
d. Leadership
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Written and oral communication
33. Which of the following is good advice for engaging in the art of negotiation?
a. be aggressive
b. the goal should be win-lose
c. spend more time talking and less time listening
d. let the other side make the first offer
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Medium
TOP: AACSB Standard: Written and oral communication
34. Delegation, defined, is granting authority and responsibility for a specific task to ______.
a. another member of the organization
b. the boss
c. a supervisor
d. top management
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
35. What is often the result when small business managers do not delegate authority and responsibility?
a. productivity increases
b. employees stop trying or leave
c. motivation goes up
d. employees want to negotiate
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Medium
TOP: AACSB Standard: Analytical thinking
36. The reason that an individual takes action in satisfying some need can be referred to as which of the following?
a. stimulation
b. self-actualization
c. motivation
d. delegation
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
37. Maslow’s hierarchy of needs theory ranks the highest level of needs as ______.
a. physiological
b. safety and security
c. esteem
d. self-actualization
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
38. Physiological needs, according to Maslow’s hierarchy of needs theory, include which of the following?
a. food and water
b. safety
c. security
d. esteem
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
39. Maslow’s hierarchy of needs has five levels. These levels, in order from lowest level to highest level, are which of the following?
a. self-actualization, esteem, social, safety and security, and physiological
b. esteem, self-actualization, social, safety and security, and physiological
c. physiological, safety and security, social, esteem, and self-actualization
d. physiological, safety and security, esteem, social, and self-actualization
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
40. Herzberg called items that make people feel positive about their jobs ______ and items that people expect in their jobs ______.
a. motivators; negative factors
b. negative factors; motivators
c. motivators; hygiene factors
d. hygiene factors; motivators
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
41. Which of the following was listed as the most precious and limited resource of a small business?
a. money
b. time
c. quality employees
d. location
KEY: Learning Objective: 14.4: Discuss time and stress management as they relate to small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.4: Special Management Concerns: Time and Stress Management
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
42. An emotional state that occurs in response to demands that may come from internal or external sources is known as ______.
a. stress
b. distress
c. confusion
d. fatigue
KEY: Learning Objective: 14.4: Discuss time and stress management as they relate to small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.4: Special Management Concerns: Time and Stress Management
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
43. Paul and Wendy are planning their first family vacation to Walt Disney World. The planning experience has been challenging for them, but they are excited about the upcoming trip and are working efficiently to ensure that everything is planned accordingly. What type of stress are Paul and Wendy experiencing?
a. eustress
b. distress
c. role conflict stress
d. task overload stress
KEY: Learning Objective: 14.4: Discuss time and stress management as they relate to small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.4: Special Management Concerns: Time and Stress Management
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
44. Role conflict can be defined as ______.
a. being faced with a situation that presents divergent role expectations
b. not being sure where to start working
c. not being sure what to do in a certain situation
d. not knowing when to start working
KEY: Learning Objective: 14.4: Discuss time and stress management as they relate to small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.4: Special Management Concerns: Time and Stress Management
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
45. Task overload can be defined as which of the following?
a. not being sure where to start working
b. more work expected from the employee than time permits
c. not being sure what to do with the time available
d. not being sure when to start working
KEY: Learning Objective: 14.4: Discuss time and stress management as they relate to small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.4: Special Management Concerns: Time and Stress Management
Difficulty Level: Medium
TOP: AACSB Standard: Analytical thinking
46. Role ambiguity is ______.
a. not being sure where to start working
b. being faced with a situation that presents divergent role expectations
c. not being sure what to do in a certain situation
d. not knowing when to start working
KEY: Learning Objective: 14.4: Discuss time and stress management as they relate to small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.4: Special Management Concerns: Time and Stress Management
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
NARRBEGIN: 14-1
Scenario 14-1. Larry owns and manages a pasta shop in a large Italian town. He employs 12 people, all of whom are fine employees. Larry has a degree in management and knows there are several functions and techniques he must pay close attention to in order to be an effective manager. The pasta shop has always been profitable for Larry and his staff.
NARREND
47. In Scenario 14-1, Larry remembers that leading is getting the most ______ possible from the available ______.
a. work; employees
b. output; resources
c. resources; suppliers
d. resources; profit
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership in Action
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
NAR: 14-1
48. In Scenario 14-1, Larry also remembers that controlling is comparing what was initially ______ with what was actually ______.
a. received; bought
b. ordered; received
c. planned; accomplished
d. accepted; defined
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
NAR: 14-1
49. In Scenario 14-1, for Larry, efficiency is when he ______.
a. makes a high profit with low expenses
b. uses all available resources to produce a high amount of output
c. does all of his tasks the right way the first time
d. accomplishes his goals and tasks while making the most of the available resources
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
NAR: 14-1
50. In Scenario 14-1, Larry knows that effectiveness from a manager’s view means ______.
a. achieving stated goals
b. achieving high profits
c. achieving low expenses
d. achieving business growth
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
NAR: 14-1
51. In Scenario 14-1, Larry has had so much business lately that some of his orders are not being filled on time. His costs are also rising out of control and there is a feeling of chaos in his business. Larry is experiencing ______.
a. growing sickness
b. growing pains
c. internal sickness
d. psychological disorders
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
NAR: 14-1
NARRBEGIN: 14-2
Scenario 14-2. Larry’s pasta shop has been growing continuously. The shop is now three times the size it was when Larry first opened it 10 years ago. There are now 26 employees working in three different shops. Larry has finally controlled his costs and has made his overall system of doing business more efficient. His two brothers, Lon and Lyn, manage the other two shops. The brothers have a partnership agreement.
NARREND
52. In Scenario 14-2, Larry can remember when he was running the first pasta shop alone. At that point he was in the ______ stage of growth.
a. initial
b. existence
c. survival
d. success
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
NAR: 14-2
53. In Scenario 14-2, when Larry hired his first employees, he went through the transition to enter the ______ stage of growth.
a. existence
b. survival
c. takeoff
d. success
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
NAR: 14-2
54. In Scenario 14-2, Larry has shown that he is an excellent manager. However, judging by the success of his pasta shops, Larry is probably also an excellent ______ since he has directed and influenced his employees into a highly successful business.
a. follower
b. dreamer
c. leader
d. supervisor
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Medium
TOP: AACSB Standard: Reflective thinking
NAR: 14-2
True/False
1. All businesses must be managed or they will cease to exist.
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
2. The four functions of management are planning, leading, organizing, and controlling.
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
3. Management is getting things done through available resources.
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
4. More time will be spent by the business owner performing the basic tasks of running the business, such as cleaning machinery, as the business is beginning than will occur later in the life cycle of the business.
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
5. The four management functions of planning, organizing, leading, and controlling are continuous and interrelated.
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
6. The negotiator role of managing an organization involves continuously going to bat for the resources needed for the success of the company.
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
7. Managers tend to work on a wide variety of activities that are brief and have little continuity throughout an eight-hour work day.
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
8. Managers have no regular duties that must be performed throughout the day.
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
9. Managers are people who must depend on judgment and intuition more than they depend on technology.
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
10. Effectiveness and efficiency, defined, are interchangeable words.
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
11. Growth is a natural, usually desirable, consequence of being in business.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
12. Growing businesses do not necessarily need changes in management techniques.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
13. A growing business will experience five different stages of growth.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
14. The distinguishing characteristic of the existence stage of growth is that the business owner is running the business alone.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
15. The distinguishing characteristic of the second stage of growth is that the key problem shifts to cash flow.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
16. The distinguishing characteristic of the third stage (the success-disengagement stage) of growth is that the business owner is removing a level of supervision.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
17. The distinguishing characteristic of the takeoff stage of growth is that the business has been reduced to a single department with one supervisor.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
18. The greatest concerns in the resource maturity stage are to consolidate and control the finances generated by rapid growth.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
19. The takeoff stage of small business growth is the stage that all business owners should aspire to reach rapidly and maintain indefinitely.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
20. When transitioning a small business to professional management, it is important to avoid delegation.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
21. One attribute of a professionally managed small business is that it plans and manages growth.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
22. An NFIB survey shows that “poor earnings” are the most important problem facing small business owners.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
23. Your three broad choices for exit strategy include sell, merge, or close.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
24. When developing an exit strategy for a current business, it is important to rely on research and analysis and avoid following instincts.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
25. Small businesses need managers who are also leaders.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
26. Leadership abilities are not necessary for small business owners since they do not work closely with people.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
27. Leadership is the process of directing and influencing the actions of members within a group.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
28. Vision is having a written plan of where the business is headed in the future.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
29. The art of negotiation is really more important for large businesses than small ones.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Written and oral communication
30. Skillful negotiators are better at talking than listening.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Written and oral communication
31. In all business negotiations, the goal for each party should be win-lose.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Written and oral communication
32. Delegation empowers employees, meaning that it increases their involvement in their work.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
33. Motivation is the reason an individual takes an action in satisfying some need.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
34. Maslow’s hierarchy of needs states that people have a common set of universal needs.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
35. The lowest needs in Maslow’s hierarchy are psychological needs.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
36. The lowest needs according to Maslow’s hierarchy are physiological needs.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
37. Items that cause people to feel positive about their job are known as motivators according to Herzberg’s motivation-hygiene theory.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
38. Items that people expect on the job are known as hygiene factors according to Herzberg’s motivation-hygiene theory.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
39. According to Herzberg, if a lower level need arises for an employee, the employee will still be able to concentrate on higher level needs.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
40. Money always motivates people.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
41. Fear always motivates people.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
42. Management is the efficient and effective use of resources.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
43. Parkinson’s law states that “anything that can go wrong, will go wrong.”
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
44. The negative side of stress, called distress, is caused by uncertain outcome and importance to the individual.
KEY: Learning Objective: 14.4: Discuss time and stress management as they relate to small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.4: Special Management Concerns: Time and Stress Management
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
45. For a situation to create eustress for a person, two conditions are necessary: the outcome must be uncertain, and it must be a matter of importance to the person.
KEY: Learning Objective: 14.4: Discuss time and stress management as they relate to small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.4: Special Management Concerns: Time and Stress Management
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
46. A person’s physical condition affects his response in stressful situations.
KEY: Learning Objective: 14.4: Discuss time and stress management as they relate to small business.
REF: Cognitive Domain: Knowledge
Answer Location: Concept Module 14.4: Special Management Concerns: Time and Stress Management
Difficulty Level: Easy
TOP: AACSB Standard: Analytical thinking
Short Answer
1. Compare and contrast two of the four functions of management.
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Medium
TOP: AACSB Standard: Analytical thinking
2. Describe at least three roles that, according to Mintzberg, are needed by managers to effectively plan, organize, lead, and control business operations.
KEY: Learning Objective: 14.1: Describe the functions and activities involved in managing a small business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.1: Managing Small Business
Difficulty Level: Medium
TOP: AACSB Standard: Analytical thinking
3. Discuss three of the five stages of business growth.
KEY: Learning Objective: 14.2: Explain the stages of small business growth and their consequences for managing your business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.2: Small Business Growth
Difficulty Level: Medium
TOP: AACSB Standard: Analytical thinking
4. Discuss three attributes that business leaders will need in the coming decade.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Medium
TOP: AACSB Standard: Analytical thinking
5. Provide at least three tips for managing time effectively.
KEY: Learning Objective: 14.4: Discuss time and stress management as they relate to small business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.4: Special Management Concerns: Time and Stress Management
Difficulty Level: Medium
TOP: AACSB Standard: Analytical thinking
6. Compare and contrast Maslow’s hierarchy of needs and Herzberg’s motivation-hygiene theory.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Medium
TOP: AACSB Standard: Analytical thinking
7. Employee theft is a serious problem for small business owners. Discuss how you would try to minimize it in your business.
KEY: Learning Objective: 14.3: Discuss the significance of leadership and motivation in regard to employees of small business.
REF: Cognitive Domain: Comprehension
Answer Location: Concept Module 14.3: Leadership In Action
Difficulty Level: Medium
TOP: AACSB Standard: Analytical thinking
Document Information
Connected Book
Small Business Competitive Advantage 7e Test Bank
By Timothy S. Hatten