Sample Exam without Answers Verified Test Bank 5th Edition

(Sample) COMPREHENSIVE EXAMINATION/CHALLENGE TEST

Scoring: 100 marks

Time: 3 hours

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student name

Part A

Define each of the following terms in one or two COMPLETE SENTENCES. Please answer in the space provided.

(value: 2 marks each = 14 marks).

1. Entrepreneurship

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2. Liability Insurance

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3. Venture Capitalist

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4. Marketing

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5. Key Ratio

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6. Market Potential

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7. Small Business

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Part B

Calculate the correct answer to each of the following questions. Show your calculations in the space provided. (value: 2 marks each = 6 marks).

1. Angela has a business that prints promotional T-shirts for which she charges about $18.00 apiece. Angela pays $6.00 each for the T-shirts and her monthly overhead runs about $1,020.00. How many T-shirts must Angela sell each month in order to break-even?

2. Last year, Gunther invested $5,000 to start a business and his partners invested

$15,000. The new company also borrowed $5,000 from the bank and made a profit of

$1,000 in the first year. What is the RETURN ON OWNERS' EQUITY in the first year. (Express your answer as a percentage).

3. Zena is thinking of buying a business that makes a profit of about $20,000 per year. She would like to get a Return on Investment of about 20%. How much should she be willing to pay for the business?

Part C

Answer each of the following questions in COMPLETE SENTENCES and paragraphs. Please write carefully on the answer sheets provided.

1. Explain how a business can protect its intellectual property by each of: Patent, Copyright, Trademark, Industrial Design. Explain what each protects and give concrete examples.

(value: 10 marks each = 80 marks)

2. List and discuss the advantages and disadvantages of "Buying an Existing Business", as opposed to other start-up methods. How does buying an existing business compare to buying a franchise? (value: 10 marks).

3. You have saved $7 000 toward the start-up of a retail business. Your total start-up costs (including rent-deposit, inventory, lease-hold improvements and operating capital) will be around $45 000. Identify a variety of sources where you could secure the additional finance and explain the terms under which you would expect to get the money.

(value: 10 marks).

4. You have decided to start up an on-line buy/sell sports memorabilia (collectibles) store with a small brick and mortar storefront that displays product. Describe how your marketing promotion will be the same or will vary for each of the channels? How would you plan to compete in the marketplace? What is the ideal location and site for this storefront?

(value: 10 marks).

5. You and your sister have decided to open a business that you will jointly own and operate. What are your options as to Legal Form? Discuss the advantages and disadvantages of each.

(value: 10 marks).

6. Name the five major sections for a basic start-up business plan and briefly discuss what each covers. (value: 10 marks)

7. Explain five ways in which non-profit organizations are similar to businesses. How are they different? Why do non-profits need business plans? (value: 10 marks)

8. Define the term ethics and explain who can be harmed by unethical behaviour on the part of an entrepreneur. Use examples. Explain how ethics is different from morality and give examples to show how there may be a conflict between the two. (value: 10 marks)