Which of the following statements concerning global trade

Question

ENTREPRENEURSHIP

Question 1
Which of the following statements concerning global trade is true?
a. Today, the global marketplace is as much the territory of small, upstart companies as it is that of giant multinational corporations.
b. Ninety-six percent of the world's population and 67 percent of the world's purchasing power lie outside the borders of the United States.
c. Small companies that export grow more rapidly than those that operate domestically only.
d. All of the above.

Question 2
The advance rate on an asset-based loan secured by a company's inventory typically would be __________ percent.
a. 90-100
b. 75-85
c. 55-85
d. 10-50

Question 3
This financing program spans 11 government agencies and is designed to encourage small companies to expand their research and development efforts in science and engineering and to develop new commercial products and services from those efforts.
a. Small Business Innovation Research Program
b. Small Business Technology Transfer Program
c. Certified Development Company Program
d. Urban Development Action Grant Program

Question 4
The typical venture capital company receives more than 1,200 business plans each year, and ultimately invests in __________ of them.
a. 3 to 6
b. 15 to 20
c. 30 to 35
d. about 100

Question 5
An entrepreneur trying to find a location for a sporting goods store has decided to use the index of retail saturation as a guide. She knows that Site 1 has a trading area with 42,374 potential customers who spend an average of $87.50 on sporting goods per year. The only competitor in the trading area has 16,000 square feet of selling space. Site 2 has 38,649 potential customers spending an average of $91.25 per year on sporting goods. In this trading area, two competitors occupy 17,100 square feet of space. Based on the index of retail saturation, which site should the owner choose?
a. Site 1
b. Site 2
c. Neither one
d. Impossible to tell from data given

Question 6
Small business owners consider __________ to be lenders of first resort.
a. insurance companies
b. SBICs
c. commercial banks
d. commercial finance companies

Question 7
When creating a Web site, the best approach is:
a. Get the site online and then tweak it, change it, and update it based on what is working best.
b. Don't launch a Web site until it is absolutely perfect.
c. The flashier a Web site is the better it is.
d. All of the above.

Question 8
According to a study by Jupiter Communications, setting up an e-commerce site takes most companies at least __________ to complete.
a. one month
b. six months
c. one year
d. two years

Question 9
A __________ layout arranges displays in a rectangular fashion so that aisles are parallel; it is a formal layout that controls the traffic flow through the store and is often used in supermarkets and drugstores.
a. Grid
b. free-form
c. boutique
d. spiral

Question 10
Online newsletters should be kept to about:
a. 600 words
b. 2000 words
c. 6 pages
d. 20 pages

Question 11
A __________ Web site is one that visitors are willing to share with their friends because they find it to be useful, informative, or just plain fun.
a. sticky
b. viral
c. collaborative
d. robust

Question 12
Experts estimate that __________ of the products U.S. companies export to other nations require little modification to sell in foreign markets.
a. one-tenth
b. one-fourth
c. one-third
d. one-half

Question 13
Business incubators:
a. combine low-cost, flexible rental space with a multitude of support services for their small business residents.
b. give small companies a greater chance for success by offering them valuable business services as well as connections to funding sources and management consulting.
c. improve their residents' survival rates;
d. All of the above.

Question 14
When searching for a location, a company that develops computer software for the entertainment industry would be interested in studying which of the following factors about the labor supply in a particular area?
a. the number of workers available
b. the level of education, training, and experience of the workforce
c. the prevailing wage rate in the area
d. All of the above

Question 15
Job __________ involves building motivators into a job by increasing the planning, decision making, organizing, and controlling functions workers perform.
a. simplification
b. enlargement
c. enrichment
d. rotation

Question 16
Small companies that operate globally are able to:
a. offset sales declines in the domestic market.
b. extend their products' life cycles.
c. raise their levels of quality and customer-orientation.
d. All of the above.

Question 17
One distinct advantage of a loan guaranteed by the Small Business Administration (SBA) is:
a. its below-market interest rate.
b. its longer payback period.
c. the small company's ability to defer payments on the loan until its cash position is strong enough.
d. All of the above.

Question 18
When Blue Fish Clothing decided to raise money for growth and expansion by selling shares of company stock straight to investors without relying on an investment banker (or underwriter), the company was making which kind of stock offering?
a. Rule 147
b. direct stock offering
c. Regulation S-B
d. Best-efforts stock offering

Question 19
Which of the following statements concerning e-commerce is true?
a. Once an entrepreneur launches a Web site, customers typically flock to it even without advertising and promoting the site.
b. More than 90 percent of all commercial Web sites are profitable.
c. Web retailers invest more of their revenues in marketing and advertising than traditional, "off-line" retailers do.
d. Because of the security precautions modern technology provides, customer privacy is not an important issue on the Web.

Question 20
For which of the following businesses would clustering be an effective location strategy?
a. a car dealership
b. a flower shop
c. a sporting goods store
d. a dry cleaner

Question 21
"Cool" companies:
a. demonstrate a respect for work and life balance.
b. value diversity in the work force.
c. create and support a learning environment among employees.
d. All of the above.

Question 22
A(n) __________ minimizes estate taxes on a business by creating two classes of stock: preferred voting stock (the value of which remains constant) for the parents, and nonvoting common stock (the value of which reflects the increased value of the business) for the children.
a. family limited partnership
b. estate freeze
c. buy/sell agreement
d. grantor retained annuity trust

Question 23
__________ banks are most likely to lend money to small businesses.
a. Small
b. Large
c. International
d. Foreign

Question 24
The Americans with Disabilities Act (ADA):
a. applies to every business, whatever its size.
b. requires companies to make expensive changes to their work environments and stores to accommodate disabled workers and customers.
c. requires most businesses to make their facilities available to physically challenged customers and workers.
d. requires businesses in all multistory buildings to have elevators.

Question 25
When a company is doing business in a country that lacks the cash to pay for imported goods or whose currency is basically worthless outside that country's borders, it:
a. should stop doing business there.
b. can use bartering.
c. can use countertrading.
d. can use bartering or countertrading.

Question 26
__________ capital represents a company's temporary funds and the need for it is created by the uneven flow of cash into and out of the business due to normal seasonal fluctuations.
a. Fixed
b. Working
c. Growth
d. Disposable

Question 27
What drives the choice of the "best" site for a small business?
a. the owner's preferences in finding a good place to live
b. customer traffic
c. cost
d. available rental space

Question 28
Which of the following statements concerning asset-based loans is false?
a. The most common types of asset-based loans are discounting accounts receivable and inventory financing.
b. Because of its efficiency and low cost, asset-based loans are an ideal source of long-term financing.
c. A small company that qualifies for a $1 million line of credit would be able to borrow as much as $3 million using asset-based loans.
d. All of the above

Question 29
Created in 1947, this became the first global tariff agreement, and, today, it includes 124 countries that account for nearly 90 percent of world trade.
a. NAFTA
b. WTO
c. GATT
d. NATO

Question 30
Companies that make the best candidates for direct public offerings (DPOs):
a. have the ability to meet the same requirements as companies making stock offerings using more traditional methods.
b. have high name recognition and a loyal customer base.
c. usually are simple, one-product companies.
d. All of the above.

Question 31
The most important ingredient in the recipe for a successful joint venture is:
a. negotiating an iron-clad contract that binds both parties.
b. choosing the right partner.
c. seeing the joint venture for what it really is: a chance for both parties to make large profits by joining forces.
d. to build a monopoly in the target country.

Question 32
Which of the following types of information is not available from U.S. census data?
a. income levels
b. educational levels
c. expenditures on food
d. commuting times

Question 33
Retail customers on the Web demand:
a. good product selection at competitive prices
b. well-designed product presentations
c. easy ordering with fast and reliable shipping and handling
d. All of the above.

Question 34
When a bank becomes a __________ lender under the Small Business Administration's loan program, the bank makes the final decision on a small company's loan application (subject only to review by the SBA) but still receives the security of the SBA's loan guarantee.
a. certified
b. preferred
c. authorized
d. conferred

Question 35
__________ items are best suited for selling on the World Wide Web.
a. high-volume
b. low-margin
c. commodity
d. all of the above.

Question 36
__________ offer many of the same kinds of loans that commercial banks do, but they are willing to tolerate more risk in their loan portfolios than banks and often use some type of asset-based lending when making commercial loans.
a. Insurance companies
b. Stock brokerage houses
c. Commercial finance companies
d. Credit unions

Question 37
Effective leaders:
a. create a set of values and beliefs for employees and passionately pursue them.
b. communicate with their employees.
c. value the diversity of their workers.
d. All of the above.

Question 38
Studies show that __________ percent of first-generation family businesses fail to survive into the second generation, and of those that do survive, __________ make it to the third generation.
a. 20; 81
b. 40; 75
c. 70; 12
d. 90; 24

Question 39
The greatest opportunities for e-commerce lie in which sector?
a. retail
b. business-to-consumer
c. business-to-business
d. information technology

Question 40
What can e-businesses do to enhance customers' trust in their Web sites?
a. post a privacy policy on their sites and stick to it.
b. clearly explain shipping costs and return policies.
c. protect and respect their customers' privacy online.
d. all of the above.

Question 41
__________ are privately-owned financial institutions that are licensed and regulated by the Small Business Administration; they use a combination of private and federally-guaranteed debt to provide long-term capital to small businesses.
a. SBICs
b. SBDCs
c. LDCs
d. UDAGs

Question 42
Web-based businesses invest ____ percent of revenue in marketing, compared to _____ percent for off-line businesses.
a. 65, 4
b. 55, 8
c. 45, 16
d. 35, 32

Question 43
The most popular estate planning technique among business owners is the:
a. buy/sell agreement.
b. grantor retained annuity trust
c. estate freeze
d. family limited partnership

Question 44
More than __________ percent of all companies in the United States are family-owned.
a. 20
b. 40
c. 60
d. 90

Question 45
The average success rate of joint ventures is __________ percent , while its average life is __________ years.
a. 81; 20
b. 62; 10.5
c. 43: 3.5
d. 25; 1.5

Question 46
Column A Column B people things vision logistics toward the vision doing the right things doing things right comes first comes second Column A deals with __________, and column B deals with __________.
a. staffing; leadership
b. leadership; staffing
c. management; leadership
d. leadership; management

Question 47
Empowerment works best when a manager:
a. trusts workers to do their jobs well.
b. trains workers continuously to upgrade their skills.
c. listens when workers have ideas, solutions, or suggestions.
d. All of the above.

Question 48
In the _________ management style, entrepreneurs bring other people into the company to help but do not delegate any significant authority to them, choosing instead to watch over everything themselves.
a. craftsman
b. classic
c. coordinator
d. small partnership

Question 49
A __________ is an exemption from the Security and Exchange Commission's full-blown registration process that is designed to make it easier and less expensive for small companies to make initial public offerings. The ceiling on this type of issue is $1 million, and the price of the shares must be at least $5.
a. Regulation S-B
b. Regulation A
c. Small Company Offering Registration (SCOR)
d. Direct Public Offering

Question 50
"Freebies" are not very effective in attracting visitors on the Internet.
True
False

Question 51
The best time for a business founder to name his successor as top manager is:
a. only after he steps down from the helm of the company.
b. at his retirement party.
c. well before he steps down.
d. irrelevant to the company's survival.

Question 52
A(n) __________ is a tax or a duty that a government imposes on goods and services shipped into that country.
a. tariff
b. quota
c. embargo
d. lateral agreement

Question 53
The first place entrepreneurs in search of startup funds should look is:
a. their own pockets.
b. relatives and friends.
c. venture capitalist firms.
d. angels.

Question 54
The most popular loan program sponsored by the Small Business Administration (SBA) is:
a. Low Doc Program
b. Export Working Capital Program
c. 7(a) Loan Guaranty Program
d. All of the above

Question 55
A small company using factoring would prefer which type of factoring arrangement?
a. with recourse
b. without recourse
c. exempted
d. None of the above. A small company should never use factoring as a source of financing because of its excessively high risks and costs.

Question 56
In America, business people expect to do business quickly and typically do not waste time "getting down to business." In other countries around the world, however, closing a deal typically takes much longer. In which country would an American entrepreneur need a large dose of patience when conducting business?
a. Spain
b. China
c. Japan
d. All of the above

Question 57
When financing a business startup with angel financing, entrepreneurs should remember that:
a. angels are most likely to finance startups in the $5 to $10 million range.
b. angels are willing to wait no more than two years to "cash out" their investments and expect to earn at least 60 to 75 percent returns annually.
c. angels usually invest their money locally, so it is wise to look close to home for them - usually within a 50-to 100-mile radius.
d. All of the above.

Question 58
Research by BizRate.com found that __________ percent of Web shoppers who fill their online shopping carts become frustrated and leave the site before checking out.
a. 15
b. 25
c. 55
d. 75

Question 59
Genuine leaders:
a. are self-appointed.
b. know that their success is determined by their employees' success.
c. treat their employees severely to earn their respect.
d. know that what they say to employees is more important than what they actually do.

Question 60
A company must file a __________ describing both the company and the stock offering with the Securities and Exchange Commission (SEC) before making an initial public offering.
a. lockup agreement
b. letter of intent
c. statement of corporate standing
d. registration statement

Question 61
. According to the textbook, the fastest growing market for U.S. small business exporters is:
a. Brazil
b. Malaysia
c. China
d. Phillipines

Question 62
Which of the following statements concerning the interview process is false?
a. To avoid the threat of lawsuits, business owners should ask only questions calling for "yes/no" answers.
b. Creating hypothetical situations candidates would be likely to encounter on the job and asking how they would handle them gives insight into their work habits and attitudes.
c. Develop a series of core questions and ask them of every candidate.
d. Business owners should ask candidates about a recent success and a recent failure and then look for those who describe them both with equal enthusiasm.

Question 63
Which of the following is a strategy for building a successful e-business?
a. Focus on a niche market.
b. Attract customers by giving away "freebies" and then sell to them.
c. Make sure your Web site says "credibility" to customers.
d. All of the above

Question 64
Shopping malls typically average __________ parking spaces per 1,000 square feet of shopping space.
a. 2
b. 5
c. 10
d. 16

Question 65
Which of the following countries represents the top market for U.S. small business exporters?
a. Japan
b. Mexico
c. Canada
d. Germany

Question 66
Which of the following statements concerning financing a small business is true?
a. Choosing the right sources of capital for a business can be just as important as choosing the right form of ownership or the right location because of the long-term impact it has on a company.
b. When it comes to attracting capital for launching or expanding a business, creativity counts; entrepreneurs must use as much ingenuity in financing their businesses as they do in generating their product or service ideas.
c. Before accepting startup money, entrepreneurs must take into account the "chemistry" between themselves, their companies, and their funding sources, making sure that the match is a good one.
d. All of the above.

Question 67
A __________ is a written statement of the duties, responsibilities, reporting relationships, working conditions, and materials and equipment used in a job.
a. job specification
b. job title
c. job description
d. work order

Question 68
Creating a family limited partnership can save business owners significant amounts in the estate taxes they must pay. Because family-owned businesses are closely-held, their shares of ownership are not as marketable as those of publicly-held, and tax law allows owners to discount the value of those shares. The average discount is __________ of a company's full market value.
a. 20
b. 40
c. 50
d. 70

Question 69
An entrepreneur who wants to open a bed and breakfast inn in an area that is zoned "residential" is going before the local zoning board seeking a(n) __________, a special exemption to the zoning ordinance that would allow her to locate her business in this area.
a. exception
b. variance
c. redemption
d. exclusion

Question 70
A(n) __________ is a loan arrangement with a commercial bank in which a small company can borrow up to a predetermined amount at any time during the year quickly and conveniently by writing itself a loan.
a. commercial bank loan
b. line of credit
c. floor plan
d. installment loan

Question 71
The simplest and least expensive way for a small business to begin conducting business globally is to:
a. establish a site on the World Wide Web (WWW).
b. launch an export program.
c. set up a foreign joint venture with a company in another country.
d. establish a location in a foreign country.

Question 72
The simplest way for entrepreneurs to get their business online is to:
a. rent space at an online shopping mall.
b. hire an Internet service provider (ISP).
c. hire professionals to create a custom site.
d. build a site in-house.

Question 73
A __________ is a specially designated area that allows resident companies to import materials and components from foreign countries; assemble, process, package, or manufacture them; and then ship finished products out while incurring lower tariffs and duties, or in some cases, eliminating them altogether.
a. enterprise zone
b. business incubator
c. foreign trade zone
d. export zone

Question 74
__________ is a work arrangement in which employees who spend most of their time away from the office use the same office space at different times, which can greatly reduce the need for permanent offices that would sit idle much of the time.
a. Telecommuting
b. Hoteling
c. Job sharing
d. Flexplace

Question 75
Which of the following questions is illegal in an interview?
a. Do you drink alcohol?
b. Why should we hire you?
c. Have you ever been arrested?
d. Is there any limit to your ability to work overtime or to travel?

Question 76
Domain names can be registered with the U.S. Patent and Trademark Office.
True
False

Question 77
Under NAFTA, companies have greater protection of their patents, trademarks, and copyrights across national borders.
True
False

Question 78
The Arthur Andersen/MassMutual Survey of American Family Businesses reports that __________ percent of small business owners have written estate plans.
a. 25
b. 40
c. 55
d. 75

Question 79
Small companies account for __________ percent of the companies involved in exporting, and they generate about __________ of the dollar value of the nation's exports.
a. 20; one-fifth
b. 45; one tenth
c. 58; two-thirds
d. 97; one-third

Question 80
A business owner seeking money to purchase a building and the equipment needed to launch a welding shop would need which kind of capital?
a. Fixed
b. working
c. growth
d. disposable