Exam Prep Planning for Entrepreneurs Ch.10

Test Bank

Chapter 10: Planning for Entrepreneurs

Multiple Choice

1. The process of envisioning the future for a business, including what one plans to do and how one plans to do it, is called ______.

a. white boarding

b. planning

c. brainstorming

d. surveying

Learning Objective: 10.1: Examine “planning” from an entrepreneurial perspective.

Cognitive Domain: Knowledge

Answer Location: 10.1. What Is Planning?

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

2. ______ help(s) you get out of your head and see your idea for what it really is.

a. Plans

b. Brainstorming sessions

c. Surveys

d. White-boarding

Learning Objective: 10.1: Examine “planning” from an entrepreneurial perspective.

Cognitive Domain: Comprehension

Answer Location: What Is Planning?

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

3. How many blocks compose the Business Model Canvas?

a. four

b. seven

c. nine

d. 12

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Business Model Canvas

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

4. The planning exercise that involves getting out of your usual working environment and imagining what the business could look like in three years is called ______.

a. the Business Model Canvas

b. Vivid Vision

c. a back of a napkin sketch

d. a business brief

Learning Objective: 10.2: Explain vision as an important part of planning.

Cognitive Domain: Comprehension

Answer Location: 10.2. Planning Starts With a Vision

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

5. The ______ has replaced the formal business plan in most venues.

a. pitch deck

b. Business Model Canvas

c. feasibility study

d. business brief

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Pitch Deck

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

6. The first part of the formal business plan is ______.

a. the market section

b. a description of how you intend to design, develop, and implement the plan

c. the business concept

d. the financial section

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Business Plan

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

7. The part of the formal business plan in which you discuss the industry, business structure, products and services, and how you plan to make your business a success is called the ______.

a. market plan

b. business concept

c. business brief

d. financial statement

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Business Plan

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

8. Finding a relaxing spot is important for ______.

a. visualizing

b. feedback

c. data collection

d. research

Learning Objective: 10.2: Explain vision as an important part of planning.

Cognitive Domain: Knowledge

Answer Location: 10.2. Planning Starts With a Vision

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

9. What is the concept presented by Cameron Herold’s book Double Double?

a. Vivid Vision

b. Financial Vision

c. Exercise Vision

d. Customer Vision

Learning Objective: 10.2: Explain vision as an important part of planning.

Cognitive Domain: Knowledge

Answer Location: 10.2. Planning Starts With a Vision

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

10. The feasibility study should be shared with ______.

a. no one, it is for the entrepreneur’s eyes only

b. potential investors

c. trusted friends

d. the competition

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Feasibility Study

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

11. Santiago created a ______ when he wrote down the vision for his product including the features of the product and target market.

a. cash flow statement

b. feasibility statement

c. concept statement

d. market statement

Learning Objective: 10.4: Describe questions to ask during planning.

Cognitive Domain: Comprehension

Answer Location: Questions to Ask During Planning

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

12. What is the plan depicted on one page by filling in the nine blocks of the business model?

a. business brief

b. outline

c. Business Model Canvas

d. back-of-the-napkin plan

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Business Model Canvas

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

13. Which of the following is true of pitch decks?

a. They are highly detailed.

b. They have no strict rules for length or style.

c. They are complicated.

d. They are time-consuming to create.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Pitch Deck

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

14. What is done through the Vivid Vision exercise?

a. The entrepreneur tries to imagine what the business will look like 3 years into the future.

b. The entrepreneur assesses what the business looks like in the present.

c. The entrepreneur envisions how he or she is going to build the business and the steps needed to take to get there.

d. The entrepreneur tries to imagine what the business will look like in 10 years.

Learning Objective: 10.2: Explain vision as an important part of planning.

Cognitive Domain: Knowledge

Answer Location: 10.2. Planning Starts With a Vision

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

15. Killian decides that he needs a few days away from it all to think out his ideas. He takes up an offer from a friend to spend a few days in his mountain cabin. During this time, Killian imagines what his business will look like in 3 years. He pictures his customers using his product and coming into his facility. Killian is engaging in a practice called ______.

a. strategic planning

b. Vivid Vision

c. detailing

d. Business Model Canvas

Learning Objective: 10.2: Explain vision as an important part of planning..

Cognitive Domain: Application

Answer Location: 10.2. Planning Starts With a Vision

Difficulty Level: Medium

AACSB Standard: Application of knowledge

16. A type of visual plan that is especially useful for identifying gaps in the business idea is called a ______.

a. pitch deck

b. Business Model Canvas

c. Vivid Vision

d. feasibility study

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Business Model Canvas

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

17. A 2- to 3-page document outlining the company overview, value proposition, customers, and milestones is referred to as a ______.

a. Business Model Canvas

b. business plan

c. business brief

d. feasibility study

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Business Brief

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

18. What planning tool helps entrepreneurs test the possibilities of an initial idea to see if it is worth pursuing?

a. the business brief

b. Vivid Vision

c. the feasibility study

d. the market research study

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Feasibility Study

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

19. The key to a feasibility study is ______.

a. formality

b. completeness

c. complexity

d. speed

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Feasibility Study

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

20. To produce a feasibility study, what action is needed?

a. documenting important parts of your business

b. testing, information gathering, and analysis

c. creating a well-defined financial forecast

d. meeting with the founders who will agree on the plan of action

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Feasibility Study

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

21. What type of plan are traditional investors and bankers likely to require?

a. a pitch deck

b. a traditional business plan

c. a business brief

d. a feasibility study

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Business Plan

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

22. What is the ultimate question a feasibility study is trying to answer?

a. Will my venture work?

b. What kind of team do I need to get started?

c. How much should I charge?

d. How much startup capital do I need?

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Feasibility Study

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

23. What distinguishes a business plan from other forms of business planning?

a. The business plan is for internal use only.

b. The business plan is less detailed than the pitch deck.

c. The business plan is more formal.

d. The business plan does not include a financial forecast.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: The Business Plan

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

24. How many slides do pitch decks need to have?

a. 5

b. 10

c. 25

d. There are no strict rules for pitch deck length.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Pitch Deck

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

25. What is the traditional length of a business plan?

a. less than 5 pages

b. 5–10 pages

c. 20–40 pages

d. over 40 pages

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Business Plan

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

26. Which of the following would be included in the business concept part of the business plan?

a. the industry, business structure, and products and services

b. a description of potential customers and the implementation plan

c. the overall implementation plan

d. the operations and management

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Business Plan

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

27. What is described in the market section of the business plan?

a. the industry, business structure, and products and services

b. a description of potential customers and competitors

c. the overall description of customers and the implementation plan

d. the operations and customer service

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Business Plan

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

28. What is included in the financial section of a business plan?

a. the industry, business structure, and products and services

b. a description of potential customers and competitors

c. income and cash flow, balance sheets, and financial projections

d. financial projections only

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Business Plan

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

29. The most complex and time-consuming type of plan is the ______.

a. business brief

b. pitch deck

c. business plan

d. feasibility study

Learning Objective: 10.5: Debate the value of writing business plans.

Cognitive Domain: Knowledge

Answer Location: 10.5. The Business Plan Debate

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

30. When writing a business plan, you should be ______ about the chance for success.

a. bullish

b. neutral

c. conservative

d. realistic

Learning Objective: 10.6: Implement the tips for writing plans.

Cognitive Domain: Comprehension

Answer Location: Be Realistic

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

31. In the order of entrepreneurial activities, business plans come ______.

a. at the onset of the business idea

b. after idea generation, business model canvas, feasibility study, and pitch deck

c. after the business model but before the feasibility study

d. after the business model but before the pitch deck

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: The Business Plan

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

32. When preparing financial projections for a business plan, be ______ in your estimates.

a. bullish

b. neutral

c. conservative

d. realistic

Learning Objective: 10.6: Implement the tips for writing plans.

Cognitive Domain: Knowledge

Answer Location: Tips for Writing Any Type of Plan

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

33. When writing a business plan, what is the most effective way to incorporate visuals?

a. Include a robust number of charts, graphs, and images on each page to support your plan.

b. Avoid using visuals if possible.

c. Include visuals to bring your idea to life but be careful not to crowd the plan with too many charts, graphs, and images.

d. Reduce the amount of white space as much as possible by using visuals.

Learning Objective: 10.6: Implement the tips for writing plans.

Cognitive Domain: Comprehension

Answer Location: Use Visuals

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

34. Nan presents her plan for a slip-on shoe that is water repellent, inexpensive, and highly fashionable. She believes that the market for the product is “everyone in the city of Seattle.” Because of this, she forecasts that she will capture 40 percent of the market. What is the business plan error that Nan is incurring?

a. too much fluff in the presentation

b. no clear product benefits

c. the exaggerated hockey stick

d. There is no error. This is a reasonable estimate.

Learning Objective: 10.6: Implement the tips for writing plans.

Cognitive Domain: Application

Answer Location: Tips for Writing Any Type of Plan

Difficulty Level: Medium

AACSB Standard: Application of knowledge

35. Of the following, what is the best time to write a business plan?

a. when you have the data to prove your concept

b. when you have the founder team

c. when you have adequate time

d. at any time in the formation of the business

Learning Objective: 10.6: Implement the tips for writing plans.

Cognitive Domain: Knowledge

Answer Location: Use Visuals

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

36. David writes the following at the start of his business plan: “Computers are used by almost everyone in today’s tech-savvy world. Computers are here to stay.” What advice would you give David?

a. Reserve this statement for the marketing section of the business plan.

b. Revise this statement to explain why computers are here to stay.

c. Remove the statement. It does not communicate new information.

d. Keep the statement where it is as it will help establish the market size.

Learning Objective: 10.6: Implement the tips for writing plans.

Cognitive Domain: Comprehension

Answer Location: Remove the Fluff

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

37. A document that can easily be sent to stakeholders that will give them an at-a-glance understanding of who you are, the business, and its potential, is called the ______.

a. business brief

b. pitch deck

c. Business Model Canvas

d. business plan

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Answer Location: The Business Brief

Cognitive Domain: Knowledge

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

38. What are the benefits of using visuals in a business plan?

a. They allow you to exaggerate your financial projections.

b. They are a good way to break up the text.

c. They help you avoid typos.

d. They help you avoid the exaggerated hockey stick.

Learning Objective: 10.6: Implement the tips for writing plans.

Cognitive Domain: Comprehension

Answer Location: Use Visuals

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

39. A feasibility study involves ______.

a. a 5-year plan to scale the business

b. at least 15 pages of appendices for investors to examine

c. action, testing, information gathering, and analysis

d. the creation of detailed financial projections and cash flow analysis

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Answer Location: Feasibility Study

Cognitive Domain: Knowledge

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

40. A good reason to not write a formal business plan is ______.

a. the plan costs too much

b. the team is not complete

c. the plan is old as soon as it comes off the printer

d. the data do not support the financial projections

Learning Objective: 9.2. Define TRIM and explain its importance to entrepreneurial planning. | 10.5. Debate the value of writing business plans.

Cognitive Domain: Knowledge

Answer Location: 10.5. The Business Plan Debate

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

41. Why might an entrepreneur write a simple business plan only for themselves?

a. It’s a good way to thinking about things they may not have thought about before.

b. A full plan is useless.

c. It saves time.

d. They may be unfamiliar with other plan types.

Learning Objective: 10.5: Debate the value of writing business plans.

Cognitive Domain: Comprehension

Answer Location: 10.5. The Business Plan Debate

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

42. Dr. Emmet (Tom) Thompson believes ______ is the key to success.

a. learning about the competition

b. creating a basic team

c. planning

d. implementing

Learning Objective: 10.1: Examine “planning” from an entrepreneurial perspective.

Cognitive Domain: Knowledge

Answer Location: 10.1. What Is Planning?

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

43. What important fact did the founders of Blue River Technology find out during the feasibility study?

a. The target market did not thinking their solution was viable.

b. The manufacturing plant could not make their product.

c. The team members were exaggerating their skills.

d. The product was too much.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Feasibility Study

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

44. What plan is popular for angel and venture capital funding?

a. feasibility study

b. the business plan

c. the pitch deck

d. the business brief

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Pitch Deck

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

45. All business planning starts with a ______.

a. need

b. team

c. written document

d. vision

Learning Objective: 10.2: Explain vision as an important part of planning.

Cognitive Domain: Knowledge

Answer Location: 10.2. Planning Starts With a Vision

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

46. At its heart, the ______ is the document that records answers to questions.

a. feasibility study

b. business brief

c. plan

d. pitch deck

Learning Objective: 10.2: Explain vision as an important part of planning.

Cognitive Domain: Knowledge

Answer Location: 10.2. Planning Starts With a Vision

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

47. Key partners is an aspect of what type of plan?

a. the Business Model Canvas

b. the business brief

c. the feasibility study

d. the pitch deck

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Plans Take Many Forms

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

48. Which of the following helps an entrepreneur make decisions during the initial conceptualization of the venture?

a. the Business Model Canvas

b. the business brief

c. the feasibility study

d. the pitch deck

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Feasibility Study

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

49. “Launch plan” is another term to describe a ______.

a. Business Model Canvas

b. business brief

c. feasibility study

d. pitch deck

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Pitch Deck

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

50. What sage advice would you offer an entrepreneur who has just written their first business plan?

a. Only first-time entrepreneurs need business plans, so you’ll never need to repeat the process.

b. The plan isn’t real; you can ditch it after you’ve used it to secure funding.

c. Things won’t go according to plan.

d. It’s the easiest business plan you’ll ever write since they’re more difficult to create for established companies.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Business Plan

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

51. What question are you answering in your plan when you describe the needs your product or service fulfills for your customer, the problems you are solving for them, and any evidence you have to show that your potential customers will want to buy your offering?

a. Who is your customer?

b. How big is the market?

c. How will you enter the market?

d. Who is your competition?

Learning Objective: 10.4: Describe questions to ask during planning.

Cognitive Domain: Comprehension

Answer Location: Questions to Ask During Planning

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

52. What question are you answering in your plan when you compare a competitive analysis?

a. Who is your customer?

b. How big is the market?

c. How will you enter the market?

d. Who is your competition?

Learning Objective: 10.4: Describe questions to ask during planning.

Cognitive Domain: Comprehension

Answer Location: Questions to Ask During Planning

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

53. It can take up to ______ hours to write a comprehensive business plan.

a. 4

b. 20

c. 200

d. 400

Learning Objective: 10.5: Debate the value of writing business plans.

Cognitive Domain: Knowledge

Answer Location: 10.5. The Business Plan Debate

Difficulty Level: Easy

AACSB Standard: Application of knowledge

54. Eric Ries, author of The Lean Startup, makes what argument regarding planning and forecasting?

a. Planning and forecasting are accurate only for large corporations; startups are very different and require a different approach.

b. A clever entrepreneur will take the lessons learned from large corporations’ planning and forecasting models and apply them to their startup.

c. Planning and forecasting are solid tools no matter the size of a business.

d. A lack of understanding of planning and forecasting is the reason many startups fail.

Learning Objective: 10.5: Debate the value of writing business plans.

Cognitive Domain: Comprehension

Answer Location: 10.5. The Business Plan Debate

Difficulty Level: Medium

AACSB Standard: Application of knowledge

55. How should you discuss your business’s weaknesses when writing your plan?

a. By the time you’re writing a plan, there should be no weaknesses.

b. Only include them if you already have a plan to fix them.

c. Avoid mentioning them.

d. Be honest, but don’t dwell on it.

Learning Objective: 10.6: Implement the tips for writing plans.

Cognitive Domain: Knowledge

Answer Location: Be Honest About Your Weaknesses

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

True/False

1. Most businesses do not need a plan to get started.

Learning Objective: 10.1: Examine “planning” from an entrepreneurial perspective.

Cognitive Domain: Comprehension

Answer Location: 10.1. What Is Planning?

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

2. If your plan is not described in a formal document, chances are you do not really have a plan.

Learning Objective: 10.1: Examine “planning” from an entrepreneurial perspective.

Cognitive Domain: Comprehension

Answer Location: 10.1. What Is Planning?

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

3. The feasibility study helps determine whether the idea is a “go” or “no go.” ______

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Feasibility Study

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

4. A plan is a written description of the future you envision for your business, including what you plan to do and how you plan to do it.

Learning Objective: 10.1: Examine “planning” from an entrepreneurial perspective.

Cognitive Domain: Knowledge

Answer Location: 10.1. What Is Planning?

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

5. The purpose of the feasibility study is to provide a short-term plan for launching your business.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Feasibility Study

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

6. The pitch deck is a presentation highlighting many of the essential elements found in a feasibility study and a business plan.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Pitch Deck

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

7. The pitch deck has replaced the formal business plan in most venues.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Pitch Deck

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

8. In general, it is not a good idea to use visuals in a business plan.

Learning Objective: 10.6: Implement the tips for writing plans.

Cognitive Domain: Comprehension

Answer Location: Use Visuals

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

9. All experts agree that writing a formal business plan is necessary for the success of a startup.

Learning Objective: 10.5: Debate the value of writing business plans.

Cognitive Domain: Comprehension

Answer Location: 10.5. The Business Plan Debate

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

10. Planning is the same as a plan.

Learning Objective: 10.1: Examine “planning” from an entrepreneurial perspective.

Cognitive Domain: Knowledge

Answer Location: 10.1. What Is Planning?

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

11. A Vivid Vision should always be presented as a written document rather than a gallery sketch, photo montage, or video.

Learning Objective: 10.2: Explain vision as an important part of planning.

Answer Location: 10.2. Planning Starts With a Vision

Cognitive Domain: Knowledge

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

12. According to the text, you are not ready to decide whether a business idea is viable until you have talked to at least 50 potential customers.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Answer Location: Feasibility Study

Cognitive Domain: Knowledge

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

13. A business plan must be thought of as a work in progress because nothing goes according to plan.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Answer Location: The Business Plan

Cognitive Domain: Knowledge

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

14. The authors advise writing a formal business plan before testing ideas in the real world.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Answer Location: Summary of Different Types of Plans

Cognitive Domain: Comprehension

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

15. Your Vivid Vision should detail how you plan to reach your idealized future.

Learning Objective: 10.2: Explain vision as an important part of planning.

Answer Location: 10.2. Planning Starts With a Vision

Cognitive Domain: Knowledge

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

16. An entrepreneur must create a single business plan that will work for all audiences.

Learning Objective: 10.6: Implement the tips for writing plans.

Answer Location: Tips for Writing Any Type of Plan

Cognitive Domain: Comprehension

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

17. It is important to remember that only a business plan can be used to obtain funding.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 10.3. Plans Take Many Forms

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

18. All businesses, regardless of size, need a formal business plan.

Learning Objective: 10.5: Debate the value of writing business plans.

Cognitive Domain: Comprehension

Answer Location: 10.5. The Business Plan Debate

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

19. Experts today are unanimous: the business plan is a critical first step for a successful entrepreneur.

Learning Objective: 10.5: Debate the value of writing business plans.

Cognitive Domain: Comprehension

Answer Location: 10.5. The Business Plan Debate

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

20. Most startups do not have competition.

Learning Objective: 10.4: Describe questions to ask during planning.

Cognitive Domain: Comprehension

Answer Location: Tips for Writing Any Type of Plan

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

21. Key partners, key activities, and key resources are three of the nine blocks in the Business Model Canvas.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Business Model Canvas

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

22. As compared to the Business Model Canvas, the business brief is much more visual but requires less detail.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: The Business Brief

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

23. Most feasibility studies are three pages or fewer.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Feasibility Study

Difficulty Level: Easy

AACSB Standard: Systems and processes in organizations

24. The purpose of a pitch deck is to help the entrepreneur determine if a venture is viable.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: The Pitch Deck

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

25. There are free tools online that help entrepreneurs distill their plans down into single pages.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Summary of Different Types of Plans

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

Essay

1. Imagine that you are opening a store that offers landscaping supplies to homeowners. Describe the actions you would take in planning for your business.

Learning Objective: 10.1: Examine “planning” from an entrepreneurial perspective.

Cognitive Domain: Comprehension

Answer Location: 10.1. What Is Planning?

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

2. Compare and contrast a feasibility study versus a pitch deck.

Ans. A feasibility study typically is used internally by the company to determine the essentials that make the business work. The entrepreneur will look at market size, suppliers, distributors, and the skills of the founders but will usually keep the conclusions internally. A pitch deck may include some of the same data, but it is presented to angel and venture capital funding teams. The information is summarized into a “deck.”

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Analysis

Answer Location: 10.3. Plans Take Many Forms

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

3. Imagine that you are thinking of starting a home care business for those recovering from illness or requiring home assistance. What research would be appropriate when preparing a feasibility study?

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Application

Answer Location: Feasibility Study

Difficulty Level: Medium

AACSB Standard: Application of knowledge

4 You have been talking to a friend who may be interested in investing in your company. However, he would like to see a plan to be assured that the business would work, given the business environment, market, and ability to carry out the plan. Describe the planning tool advisable in this situation and itemize the elements of the plan.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Analysis

Answer Location: The Pitch Deck

Difficulty Level: Medium

AACSB Standard: Analytical thinking

5. Describe what a business brief is and how it would be used as part of the entrepreneur’s planning process.

Learning Objective: 10.3: Explain the different types of plans used by entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: The Business Brief

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

6. Describe why you do or do not believe that writing a business plan would be important to your business success.

Learning Objective: 10.5: Debate the value of writing business plans.

Cognitive Domain: Comprehension

Answer Location: 10.5. The Business Plan Debate

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

7. Explain the importance of planning for entrepreneurs.

Learning Objective: 10.1: Examine “planning” from an entrepreneurial perspective.

Cognitive Domain: Comprehension

Answer Location: 10.1. What Is Planning?

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

8. Describe a concept statement. What questions is it designed to answer? What is its value to the entrepreneur? What is its value to potential investors?

Learning Objective: 10.4: Describe questions to ask during planning.

Answer Location: What Is Your Business and How Does It Add Value?

Cognitive Domain: Analysis

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

9. What is the best way, during planning, to determine who your competition is? Why is this necessary and valuable?

Learning Objective: 10.4: Describe questions to ask during planning.

Answer Location: Who Is Your Competition? Why Are You Better?

Cognitive Domain: Analysis

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations

10. Describe Cameron Herold’s Vivid Vision process. Why is the focus on three years down the road? What are the crucial aspects of the process? What is innovative or groundbreaking about the process, and why? What part of the process will be most challenging, in your evaluation, and why?

Learning Objective: 10.2: Explain vision as an important part of planning.

Answer Location: 10.2. Planning Starts With a Vision

Cognitive Domain: Analysis

Difficulty Level: Medium

AACSB Standard: Systems and processes in organizations