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Exam 6: Small Business and Entrepreneurship: Economic Rocket Fuel

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Question 51

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Which of the following is a significant drawback of getting into business by entering into a franchise arrangement?

A) The initial cost of most well-known franchises can be quite inexpensive.
B) It is less difficult to get out of than other forms of business ownership.
C) The owner must pay an on-going royalty to the franchiser.
D) A franchisee has more independence and flexibility than the owner of a business that is started from scratch.

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Question 52

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To be a successful entrepreneur, you must fit the entrepreneurial profile.

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Question 53

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What three factors explain the wide differences in entrepreneurship rates among countries? How do these factors help explain the relatively high rate of entrepreneurship in Canada?

Successful entrepreneurs typically view their failures as opportunities to learn so that they can do better next time.

Research suggests that teenagers and young adults make up the fastest growing segment of start-up owners.

Starting a business from scratch rather than buying an existing company means that the owner has more control over all aspects of the company's organization, structure, and strategy. This can be both a major advantage and a major disadvantage.

A key reason for developing a formal business plan is that having such a plan is absolutely critical when seeking external financing.

About half of all start-ups use credit cards as a source of financing.

Dr. George Petrie, educator and a university football coach, once explained his outlook in the statement: "I believe that this is a practical world and that I can only count on what I earn. Therefore, I believe in work-hard work." Dr. Petrie's views suggest that he had an internal locus of control.

What would a commercial lender expect to find in a business plan?

Mary Kate is a successful entrepreneur. Which of the following would best describe her?

What do entrepreneurs tend to be tolerant of?

Salome is thinking about starting a small business and is trying to assess the potential opportunities and threats associated with a new start-up. She's talked with friends and associates about her plans, and several have offered her opinions and advice. The comments of four friends are summarized below. Which of these statements would probably be the most helpful to Salome?

Cultural and political factors help explain why Canada has a much higher entrepreneurship rate than Japan and many European nations.

Describe three of the basic qualities of successful entrepreneurs. Give two specific examples of successful entrepreneurs who are currently making their mark.

Small business owners typically find that the small size of their companies makes it simple for them to handle all of the management functions by themselves.

One common mistake that small business owners make is to develop long, detailed business plans that bankers and investors simply won't take the time to read.

The primary factor that influences many people to become entrepreneurs is the opportunity to make more money than they could earn if they worked for someone else.

The majority of new small businesses obtain most of their initial financing from bank loans.

Which of the following nations is likely to have the lowest percentage of "necessity entrepreneurs"?