Neck Anticipating Failure Test Bank Ch.11

Test Bank

Chapter 11: Anticipating Failure

Multiple Choice

1. A change in direction in response to a small failure is called a ______.

a. failure

b. pivot

c. termination

d. retrenchment

Learning Objective: 11.1: Describe failure and its effect on entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: 11.1. Failure and Entrepreneurship

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

2. According to the text, why do many see failure as the path by which individuals travel to develop into entrepreneurs?

a. Once the business is closed, stress is reduced, freeing the mind for creative thinking.

b. The process of avoiding failure makes the entrepreneur more vigilant.

c. Failure can intensify the cognitive processes involved in learning, resulting in improvements in future performance.

d. Those who aren’t suited for business get out early, leaving the field open for others’ successes.

Learning Objective: 11.1: Describe failure and its effect on entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.1. Failure and Entrepreneurship

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

3. What behavior is at the top of the failure spectrum?

a. inattention

b. uncertainty

c. deviance

d. lack of ability

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Knowledge

Answer Location: Deviance

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

4. What can be said of small failures in the entrepreneurial journey?

a. They usually lead to the overall failure of the company.

b. They usually have no ultimate effect on the business or the entrepreneur.

c. They are the low points but are manageable and help the entrepreneur learn.

d. They cannot be reversed.

Learning Objective: 11.1: Describe failure and its effect on entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.1. Failure and Entrepreneurship

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

5. Which of the following describes a successful entrepreneur’s typical reaction to failures, particularly small ones?

a. They have very few failures because they do everything to avoid them.

b. They get out of the business as early as possible in order to cut their losses.

c. They see failures as opportunities to build on what they learned or capture new opportunities.

d. They try to make failures happen to increase the overall creative tension.

Learning Objective: 11.1: Describe failure and its effect on entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.1. Failure and Entrepreneurship

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

6. Failure as a result of the wrong procedures being set up in the organization so communication breaks down among employees and things begin to fall through the cracks is known as ______.

a. uncertainty

b. process inadequacy

c. deviance

d. lack of ability

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Comprehension

Answer Location: Process Inadequacy

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

7. Justin opened a physical therapy business in a new location and hired two well-known therapists. Once the business was up and running, Justin began work on launching a restaurant in a neighboring town. With Justin at the restaurant most days, the physical therapy business began to flounder. Which startup failure is represented in this scenario?

a. uncertainty

b. process inadequacy

c. inattention

d. deviance

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Application

Answer Location: Inattention

Difficulty Level: Medium

AACSB Standard: Application of knowledge

8. Nour operated a successful massage and health spa in a lucrative resort location. She handled all reservations herself and if a customer called to make an appointment when she wasn’t in the spa, she asked her employees to leave her a note. The notes sometimes went missing, resulting in angry customers. Which startup failure type is most likely represented in this scenario?

a. uncertainty

b. process inadequacy

c. inattention

d. deviance

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Application

Answer Location: Process Inadequacy

Difficulty Level: Medium

AACSB Standard: Application of knowledge

9. Amy C. Edmondson, professor of leadership and management at Harvard Business School, describes a spectrum for failure that runs from blameworthy to praiseworthy. According to Edmondson, a praiseworthy reason for failure is ______.

a. uncertainty—taking unreasonable actions due to lack of clarity

c. deviance—defying ethical and legal boundaries

b. inattention—getting sidetracked from the core business

d. exploratory experimentation—conducting market tests to get early feedback

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Comprehension

Answer Location: 11.2. The Failure Spectrum

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

10. ______ is caused by crossing an ethical boundary, leading to mismanagement of the venture.

a. Inattention

b. Deviance

c. Lack of ability

d. Uncertainty

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Knowledge

Answer Location: Deviance

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

11. Rory and Katie manufactured a smartphone-related product marketed for personal safety. Unsure about the best market segment to target, they developed a product for older adults and the general public but they decided to also market it for children. Which of the following is the most likely cause for failure here?

a. inattention

b. deviance

c. lack of ability

d. uncertainty

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Application

Answer Location: Uncertainty

Difficulty Level: Medium

AACSB Standard: Application of knowledge

12. Founding CEO Alison led a team of talented programmers. The company quickly grew. Alison eventually stepped down as CEO because while she had strong technical skills, she realized she did not have the vision and skillset a CEO needed to lead a large corporation. Which of the following is likely the reason Alison stepped down?

a. lack of ability

b. process inadequacy

c. uncertainty

d. inattention

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Application

Answer Location: Lack of Ability

Difficulty Level: Hard

AACSB Standard: Application of knowledge

13. It is important for entrepreneurs to manage the negative emotions associated with failure so they can ______.

a. begin the process of learning from failure

b. avoid the consequences of failure

c. understand the external reasons for their failure

d. shift the blame to others for their failure

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.3. Fear of Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

14. According to the text, we don’t always hear about the reasons for business failures because ______.

a. expressing the emotions of failure is difficult, as admitting failure is unpleasant

b. people may be unaware of their role in the failure

c. people blame external reasons for their failure

d. no one is interested in hearing about failures

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.3. Fear of Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

15. Studies show that individuals who are ______ will go out of their way to avoid failure.

a. raised in uncertain environments

b. raised to believe failure is unacceptable

c. raised to view failure as a learning opportunity

d. raised by helicopter parents

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.3. Fear of Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

16. Sasha developed a new technology for cordless charging of cellphones and other devices, but she misled her investors about the cost of producing the new chargers and the number of units she could supply. Which of the following is the most likely cause of failure here?

a. lack of ability

b. deviance

c. uncertainty

d. inattention

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Application

Answer Location: Deviance

Difficulty Level: Hard

AACSB Standard: Application of knowledge

17. Essential to the idea of intelligent failure is that this sort of failure ______.

a. is made only by intelligent people

b. provides valuable new knowledge

c. is intentional

d. has already been experienced by the competition

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Knowledge

Answer Location: 11.4. Learning From Failure

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

18. Based on the description in the text, Jeff Bezos is a big believer in experimentation, especially when it comes to learning from ______.

a. new ventures

b. startups

c. failures

d. other entrepreneurs

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Knowledge

Answer Location: 11.4. Learning From Failure

Difficulty Level: Medium

AACSB Standard: Application of knowledge

19. The quality that enables people to work hard and sustain interest in their long-term goals is ______.

a. fear of failure

b. grit

c. leadership

d. the entrepreneurial mindset

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Knowledge

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

20. According to Stanford psychologist Carol Dweck, people with ______ tend to believe that intelligence and talent is something we’re born with, and they avoid failure at all costs.

a. a growth mindset

b. a fixed mindset

c. grit

d. an entrepreneurial mindset

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Comprehension

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

21. Once you establish the extent of your fear of failure, which of the following would be a good step toward coping with it?

a. Reframe goals so that they are more achievable.

b. Keep your goals exactly the same.

c. Reframe goals so they are harder to achieve.

d. Stop being goal-oriented.

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Signs of Fear of Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

22. Once you establish the extent of your fear of failure, which of the following would be a good step toward coping with it?

a. Deliberately allow yourself to feel the fear.

b. Try to suppress your fear.

c. Try to distract yourself so you don’t feel your fear.

d. Pretend you are fearless.

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Signs of Fear of Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

23. In efforts to cope with the emotions associated with fear, which of the following is recommended for shifting negative feelings and triggering a calm response?

a. deep breathing

b. avoiding high-stress situations

c. lowering your expectations of success

d. refusing to recognize the fear

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Signs of Fear of Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

24. According to The Global Entrepreneurship Monitor report, people in what area of the world have the highest percentage of perceived opportunities?

a. Africa

b. Oceania

c. Asia

d. Europe

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Global Fear of Failure

Difficulty Level: Easy

AACSB Standard: Contexts of organizations in a global society

25. According to The Global Entrepreneurship Monitor report, the fear of failure in the United States is higher than in which of the following?

a. Angola

b. India

c. Greece

d. Morocco

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Global Fear of Failure

Difficulty Level: Medium

AACSB Standard: Contexts of organizations in a global society

26. In studying failure around the world, Global Entrepreneurship Monitor recognized three types of economies. Which of the following represents people who think they have what it takes to start a business?

a. perceived opportunities

b. entrepreneurial intentions

c. entrepreneurial success

d. perceived capabilities

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Global Fear of Failure

Difficulty Level: Easy

AACSB Standard: Contexts of organizations in a global society

27. In studying failure around the world, Global Entrepreneurship Monitor recognized three types of economies. Which of the following represents the degree to which those capable of starting a business may intend to do so over three years?

a. entrepreneurial intentions

b. perceived opportunities

c. driven opportunities

d. perceived capabilities

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Global Fear of Failure

Difficulty Level: Easy

AACSB Standard: Contexts of organizations in a global society

28. In the context of experimentation, what is another way to think about the word failure?

a. intentional iteration

b. bad failures

c. controlled research

d. unnecessary mistakes

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Comprehension

Answer Location: 11.4. Learning From Failure

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

29. Failures that provide valuable new knowledge that can help a startup innovate and stride ahead of its competition are best described as ______.

a. constructive failures

b. intentional failures

c. intelligent failures

d. planned failures

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Knowledge

Answer Location: 11.4. Learning From Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

30. Instead of “failure,” a process of prototyping, testing, analyzing, and refinement is best thought of as ______.

a. unintentional iteration

b. intentional iteration

c. intelligent failure

d. constructive failure

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Knowledge

Answer Location: 11.4. Learning From Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

31. According to Stanford psychologist Carol Dweck, people with ______ develop their abilities through dedication, effort, and hard work.

a. a growth mindset

b. a fixed mindset

c. grit

d. an entrepreneurial mindset

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Comprehension

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

32. In the context of grit, the strength to recover from failure and overcome obstacles in order to persevere toward the achievement of long-term goals is called ______.

a. excellence

b. resilience

c. conscientiousness

d. courage

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Knowledge

Answer Location: Resilience

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

33. In the context of grit, the commitment to long-term goals through purposeful deliberate practice is called ______.

a. resilience

b. excellence

c. conscientiousness

d. perseverance

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Knowledge

Answer Location: Perseverance

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

34. In the context of grit, committing to activities that enhance skills, as well as prioritizing improvement over perfection, is called ______.

a. courage

b. excellence

c. conscientiousness

d. perseverance

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Knowledge

Answer Location: Excellence

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

35. Which of the following describes a blame-free environment?

a. an environment where entrepreneurs can never be blamed

b. an environment where everyone in the business is comfortable admitting mistakes and learning from them

c. an environment where mistakes are not acknowledged or discussed

d. an environment where blame is always directed at the entrepreneur rather than the employee

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Comprehension

Answer Location: Building a Blame-Free Environment

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

36. The key to building a blame-free environment is to ______.

a. require managers to accept all the blame

b. ensure that all failures are anonymous

c. communicate clearly what types of failures are acceptable and what types are unacceptable

d. realize that any type of failure is acceptable

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Knowledge

Answer Location: Building a Blame-Free Environment

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

37. In the context of grit, working tirelessly in the face of challenges and toward the achievement of long-term goals is called ______.

a. courage

b. excellence

c. conscientiousness

d. perseverance

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Knowledge

Answer Location: Conscientiousness

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

38. Which of the following is a positive step toward building a blame-free environment?

a. establishing clear lines of distinction between founders and employees

b. treating everyone in the company as equal members

c. not noticing mistakes when they happen

d. allowing the same mistakes to recur several times before addressing them

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Comprehension

Answer Location: Building a Blame-Free Environment

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

39. Psychologist Angela Lee Duckworth describes grit as which of the following?

a. a form of intelligence

b. the ability to work hard and sustain interest in long-term goals

c. the ability to suppress emotion when confronted with failure

d. the ability change course when interest has waned

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Knowledge

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

40. Based on her studies, psychologist Angela Lee Duckworth determined that grit ______.

a. is primarily a factor in physically demanding tasks

b. is only a factor for success in the military

c. contributes to success in a wide variety of fields and roles

d. is related to IQ

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Comprehension

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

41. Despite multiple failures and setbacks, Terri perseveres in her efforts to solve an engineering problem. This is an example of which of the following?

a. market research

b. team building

c. grit

d. pitching

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Application

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure

Difficulty Level: Easy

AACSB Standard: Application of knowledge

42. Based upon Angela Lee Duckworth’s research on children, what is the relationship between mindset and grit?

a. Those with a growth mindset tend to have less grit.

b. Those with a fixed mindset tend to have more grit.

c. Those with a growth mindset tend to have more grit.

d. Mindset is unrelated to grit.

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Knowledge

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

43. Conscious, highly structured efforts to learn new skills, carried out with an eye on long-term achievement, describes which of the following terms?

a. fixed mindset

b. perseverance

c. deliberate practice

d. structured learning

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Comprehension

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

44. Why would a growth mindset contribute to a person’s grit?

a. Both are a way to measure intelligence.

b. A desire to learn will help overcome failure and allow the person to persevere.

c. People with a growth mindset need to make things perfect.

d. People with grit will keep doing the same thing repeatedly.

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Comprehension

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure.

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

45. Lee just lost a major client. The next day, she made a list of potential new clients and started calling them to set up an introductory meeting. Which of the following characteristics is associated with this action?

a. resilience

b. creativity

c. learning

d. adaptation

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Application

Answer Location: Resilience

Difficulty Level: Medium

AACSB Standard: Application of knowledge

46. An entrepreneur who conducts market tests to get early feedback and acquire important learning and information is demonstrating ______.

a. exploratory experimentation

b. inattention

c. lack of ability

d. uncertainty

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Comprehension

Answer Location: Exploratory Experimentation

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

47. An entrepreneur who takes unreasonable actions due to a lack of clarity about future events most likely suffers from ______.

a. deviance

b. inattention

c. lack of ability

d. uncertainty

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Comprehension

Answer Location: 11.2. The Failure Spectrum

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

48. A strong fear of failure is often rooted in one’s ______, as demonstrated by the Global Entrepreneurship Monitor report.

a. national culture

b. personality type

c. peer relationships

d. work experience

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Global Fear of Failure

Difficulty Level: Medium

AACSB Standard: Contexts of organizations in a global society

49. Why did the Juicero company experience failure?

a. It failed to received funding.

b. Its founders lacked required experience.

c. It burned through money too quickly.

d. It received negative marketing exposure.

Learning Objective: 11.1: Describe failure and its effect on entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.1. Failure and Entrepreneurship

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

50. Why did Beepi fail even though it raised over $150 million?

a. There was a lawsuit over the business idea.

b. The founders spent through money too quickly.

c. Nobody wanted peer-to-peer used cars.

d. The founders were too inexperienced.

Learning Objective: 11.1: Describe failure and its effect on entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.1. Failure and Entrepreneurship

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

51. Two college friends started a company. While they were friends, they had never worked together. Why might their company fail?

a. process inadequacy

b. uncertainty

c. lack of ability

d. inattention

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Comprehension

Answer Location: Process Inadequacy

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

52. When Joelle Mertzel interviewed over 1,000 people about her prototype, she was ______.

a. preparing for failure

b. conducting exploratory experimentation

c. changing her ideas as she gained feedback

d. teaching her co-founders how to develop a product

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Comprehension

Answer Location: Exploratory Experimentation

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

53. What did CBI Insights find out when analyzing startup postmortems?

a. Co-founders cannot agree how to move forward quick enough.

b. The companies failed 42 percent of the time because they did not solve a big enough problem.

c. A little bump in the beginning will cause the startup to fail 34 percent of the time.

d. Most startups fail because a few bad reviews on social media.

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Comprehension

Answer Location: Exploratory Experimentation

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

54. A child has a higher fear of failure if ______.

a. the parents spank the child

b. the child is punished for failing

c. a sibling is better at something first

d. they are not the first-born in their family

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.3. Fear of Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

55. The cofounder of Classy Llama, Kurt Theobald, learned from his failures and ______.

a. gave up on being an entrepreneur

b. finally learned he was better as an employee

c. made a success out of his 11th startup

d. talked his parents into funding him one more time.

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Comprehension

Answer Location: Lessons Learned by Successful Entrepreneurs

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

True/False

1. Because of their personalities, entrepreneurs do not experience the emotional pain of failure.

Learning Objective: 11.1: Describe failure and its effect on entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.1. Failure and Entrepreneurship

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

2. Many entrepreneurs who have failed become more confident, prepared, and motivated to attempt another startup.

Learning Objective: 11.1: Describe failure and its effect on entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.1. Failure and Entrepreneurship

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

3. According to psychologist Angela Lee Duckworth, grit is the quality that enables people to work hard and sustain interest in their long-term goals.

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Knowledge

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

4. In the context of grit, excellence is the commitment to long-term goals through purposeful deliberate practice.

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Comprehension

Answer Location: Perseverance

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

5. Studies such as those taken on by Angela Lee Duckworth and Carol Dweck have shown that people with a high IQ are more likely to achieve success.

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Knowledge

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure.

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

6. Grit combines with deliberate practice to help the entrepreneur achieve success.

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Comprehension

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure.

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

7. Informing people of what is and is not an acceptable mistake will help create a blame-free environment.

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Comprehension

Answer Location: Building a Blame-Free Environment

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

8. Cultural differences may influence the way we approach failure.

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Global Fear of Failure

Difficulty Level: Easy

AACSB Standard: Contexts of organizations in a global society

9. The term deliberate practice refers to learning from good failures that provide valuable new knowledge that can help a startup innovate and stride ahead of its competition.

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Knowledge

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

10. According to the text, bankruptcy or forced sale is probably the biggest failure for a startup.

Learning Objective: 11.1: Describe failure and its effect on entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.1. Failure and Entrepreneurship

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

11. Researchers have suggested that the origins of fear of failure may lie in parent–child relations.

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Signs of Fear of Failure

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

12. Deviance is an attribute of grit.

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Knowledge

Answer Location: 11.5. Getting Gritty: Building a Tolerance for Failure

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

13. People in Africa have the highest percentage of entrepreneurial intentions.

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Global Fear of Failure

Difficulty Level: Medium

AACSB Standard: Contexts of organizations in a global society

14. People living in the Caribbean score among the lowest for fear of failure.

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: Global Fear of Failure

Difficulty Level: Medium

AACSB Standard: Contexts of organizations in a global society

15. Amy C. Edmondson, a professor of leadership and management at Harvard Business School, believes that failures are small blips compared to the success of an entrepreneur.

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Knowledge

Answer Location: 11.2. The Failure Spectrum

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

16. Theranos, the blood testing company, is a high-profile example of deviance.

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Knowledge

Answer Location: Deviance

Difficulty Level: Medium

AACSB Standard: Application of knowledge

17. With inattention, an entrepreneur becomes sidetracked from the core business.

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Knowledge

Answer Location: Deviance

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

18. A CBI Insights study of startup postmortems found that more than 40 percent failed because of process inadequacy.

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Knowledge

Answer Location: Exploratory Experimentation

Difficulty Level: Medium

AACSB Standard: Application of knowledge

19. One reason new companies fail is because the wrong processes are set up in the organization.

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Knowledge

Answer Location: Process Inadequacy

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

20. Antifailure bias inhibits us from learning from failure.

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: 11.3. Fear of Failure

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

21. Entrepreneurs may find it especially difficult to separate personal failure from professional failure.

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: 11.3. Fear of Failure

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

22. Maternal irritability and paternal absence may contribute to a child’s fear of failure.

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Signs of Fear of Failure

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

23. The Global Entrepreneurship Monitor report showed that the type of economy in which an entrepreneur is operating is a significant factor in fear of failure rates.

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Knowledge

Answer Location: Global Fear of Failure

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

24. When people feel comfortable enough to report failures, it is a sign that there is a successful blame-free environment.

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Comprehension

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

25. Angela Lee Duckworth’s research has proven a link between talent and achievement.

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Knowledge

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

Essay

1. Describe failure and its effect on entrepreneurs.

Learning Objective: 11.1: Describe failure and its effect on entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.1. Failure and Entrepreneurship

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

2. Describe how a fear of failure affects entrepreneurs, including whether there are any positive aspects to a fear of failure.

Learning Objective: 11.3: Describe the consequences of fear of failure for entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.3. Fear of Failure

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

3. Explain the different ways entrepreneurs can learn from failure and why it is important that they do so.

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Comprehension

Answer Location: 11.4. Learning From Failure

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

4. Jill had to close a cupcake bakery that she had established close to home. Her total investment was just under $7,000, representing all her personal savings. She attributes her failure to a poor business model. She had assumed that customers would come from wealthy residential areas when, in fact, customers seemed to be employees of large corporations who bought the cupcakes for office celebrations. In spite of her losses, Jill is hoping to start another cupcake bakery. Explain why this might be so.

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Application

Answer Location: 11.1. Failure and Entrepreneurship

Difficulty Level: Medium

AACSB Standard: Application of knowledge

5. Jeremiah has just closed his lumber yard. Based on construction demand, his business suffered during a decline in new construction. This, combined with unemployment in the area leading to fewer home improvement projects, created a limited market. Describe Jeremiah’s potential reaction to this failure based on the principles of “small” and “big” failures.

Learning Objective: 11.1: Describe failure and its effect on entrepreneurs.

Cognitive Domain: Analysis

Answer Location: 11.1. Failure and Entrepreneurship

Difficulty Level: Easy

AACSB Standard: Analytical thinking

6. Explain how the ability to pivot can avoid a “big failure.”

Learning Objective: 11.1: Describe failure and its effect on entrepreneurs.

Cognitive Domain: Comprehension

Answer Location: 11.1. Failure and Entrepreneurship

Difficulty Level: Easy

AACSB Standard: Group and individual behaviors

7. Explain how an entrepreneur might fail from lack of ability.

Learning Objective: 11.2: Identify several reasons for failure.

Cognitive Domain: Analysis

Answer Location: Lack of Ability

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

8. Describe the steps you can take to create a blame-free environment.

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Comprehension

Answer Location: Building a Blame-Free Environment

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

9. Define the term intentional iteration and explain why it is important.

Learning Objective: 11.4: Explain the different ways entrepreneurs can learn from failure.

Cognitive Domain: Comprehension

Answer Location: 11.4. Learning From Failure

Difficulty Level: Medium

AACSB Standard: Group and individual behaviors

10. Describe Angela Lee Duckworth’s research into grit at the United States Military Academy at West Point. Why might she have chosen West Point? What were her findings? What was her assessment of the West Point Whole Candidate Score as compared to her tool to measure grit?

Learning Objective: 11.5: Describe the significance of “grit” and its role in building tolerance for failure.

Cognitive Domain: Comprehension

Difficulty Level: Medium

AACSB Standard: Analysis

AACSB Standard: Group and individual behaviors