Financing and Leading the Enterprise Test Bank Docx Ch.16

Technology Ventures (Byers), 5e

Chapter 16 Financing and Leading the Enterprise

1) Revenue is sales minus returns, rebates, and discounts.

2) Which of the following is not a revenue model?

A) Transaction fee revenue

B) Advertising revenue

C) Product sales

D) Freemium revenue

3) Etsy and many other ecommerce sites take advantage of this revenue model:

A) Subscription fee

B) Affiliate revenue model

C) Member fee

D) Product sales

4) Open source companies like JBoss often make use of the product sales revenue model.

5) What is a cost driver?

A) Factor that affects total firm costs

B) Fixed costs varying over time

C) Volume of output

D) Impact on profit

6) Management salaries are an example of:

A) Variable costs

B) Semi-variable costs

C) Multi-variable costs

D) Fixed costs

7) How does Google make most of its money?

A) Text based ads on search results

B) Leasing out servers

C) Premium search capabilities

D) Android OS

8) The best conditions for profit occur when product cost is low, and ________ is high.

A) Price

B) Perceived value

C) Hockey stick growth

D) Market ownership

9) Which of the following is a high margin, low volume company?

A) BMW

B) Amazon

C) Walmart

D) Toyota

10) What is a blockbuster profit model?

A) Build a system that reuses a product in many forms

B) Create a low-cost product to offer low price per unit of value

C) Focus on creating a series of big winners

D) Find unmet customer needs and build a new business model

11) Dropbox is this type of profit model:

A) New business model

B) Protected innovation

C) Installed base

D) Low cost

12) Cash flow is the sum of retained earnings minus:

A) Depreciation provision made by the firm

B) Fixed costs

C) Profitability

D) Crunch capital

13) Entrepreneurial intensity is the drive and committed nature of any good entrepreneur.

14) What happened to Patagonia when it grew too quickly?

A) Toxic work environment

B) Cash used to meet demand-outpaced sales

C) Company fractured into two divisions

D) Lost advantages in regional economies

15) Organic growth is growth enabled by internally generated funds.

16) Which of the following is not a source of revenue growth?

A) Increased market capitalization

B) New product offerings

C) Acquisitions

D) Increased brand recognition

17) Facebook's acquisition of Instagram was risky because it cost the company a quarter of the cash they had on hand.

18) Venture capital firms typically do not realize the gains of their investment immediately because harvest plans typically have a horizon of five to ten years.

19) Why did the VR startup Vrideo fail?

A) Major corporations entered the VR scene soon after their founding

B) VR headset makers refused to support their software

C) The hype around VR died and investors no longer saw the vertical as promising

D) Internal power struggles within the company caused mismanagement of funds

20) What strategy does Tencent employ that is not as common among major western tech companies?

A) Software as a service

B) Refusal to cooperate with Chinese government

C) In-app purchases

D) Refusal to bundle software