QUESTION David embraced the bedouin work style when he began his consulting business, but now he feels ready for a little permanence and resource support. Which of the following will best meet his needs? A) angel investor B) incubator C) venture capitalist D) enterprise zone E) public stock offering ANSWER Answer: B Explanation: B) […]
QUESTION Kay is excited about her idea to open an organic cafe, but she wants to know all about the realities of operating a restaurant. She waited tables in college and has met with a retired food service executive who arranged a mentor for her. What other resource can Kay use before writing her business […]
QUESTION Which of the following reasons for the failure of a small business is NOT grounded in financial challenges? A) problems with cash flow B) unfavorable economies of scale C) highly competitive market D) lack of credit E) initial underfunding ANSWER Answer: C Explanation: C) A very competitive market may cut into profits for […]
QUESTION One of the cardinal rules of business is that the customer is always right. Which of the following business activities is NOT associated with this philosophy? A) develop familiarity with clientele B) implement economies of scale C) adapt to the market’s changing needs D) set fair prices E) sell quality products ANSWER Answer: […]
QUESTION Last year Sara made a lot of money selling organic sandwiches from her food truck parked in front of the local college. After the winter snows melted, she was surprised to see seven other food trucks parked nearby, and shorter lines and lower profits for her business. What best describes the challenge she faces? […]
QUESTION What distinguishes a micropreneur from an entrepreneur? What will be an ideal response? ANSWER Answer: Generally, a micropreneur wants to stay small and make a living, while an entrepreneur may begin as a small business but hope to grow into a larger enterprise. Explanation: Entrepreneurs tend to focus on growth, whereas micropreneurs often […]
QUESTION Teena owns a moderately successful Cuban restaurant, but finances are always tight. Her chef is extremely talented and a key factor in the restaurant’s success, but he has been considering offers from other restaurants. What is Teena’s best strategy to retain this important asset? A) offer the chef additional vacation time and a year-end […]
QUESTION Which of the following tools for supporting business is NOT associated with the government? A) credit union B) enterprise zone C) the Small Business Administration D) incubator E) the Small Business Investment Company ANSWER Answer: A Explanation: A) Enterprise zones and incubators often have some government backing. The SBA is a federal agency […]
QUESTION Sarita has been having difficulty getting a bank loan to help finance startup costs for her new food truck business. Which of the following can help a bank feel more confident in lending money to support Sarita’s new enterprise? A) Sarita’s business model B) Small Business Administration support C) urban enterprise zone participation D) […]
QUESTION Which of the following is NOT associated with financial institutions? A) credit unions B) the Small Business Administration C) banks D) peer-to-peer lending networks E) savings and loans ANSWER Answer: D Explanation: D) Peer-to-peer lending groups are associated with private organizations or Web-based communities and offer microloans to support new businesses.
