Q&A Hero

Q: Gaston knows he cannot be physically present at his new restaurant every hour it is open, so he has decided to share management responsibility and profits equally with two others. Gaston has formed a ________. A) joint proprietorship B) limited liability corporation C) limited liability partnership D) general partnership

Q: Describe a situation in which a company might adopt a pricing objective other than profit maximization.

Q: In a sole proprietorship, profits are ________. A) distributed to all partners equally B) taxed at the prevailing business rate C) taxed as the owner's personal income D) distributed to the partners according to their level of participation

Q: What is cost-oriented pricing?

Q: Fallon wants total control over the decisions related to his business but is concerned that should the business fail, his personal assets are at risk. Fallon has chosen the ________ form of ownership. A) sole proprietorship B) C corporation C) general partnership D) S corporation

Q: Differentiate between fixed costs and variable costs.

Q: The first organizing decision that an entrepreneur must make is the ________. A) type of organizational culture B) form of legal ownership C) organization structure D) assignment of duties and responsibilities

Q: Identify and describe the six sections of the business plan, including the type of information that should appear in each section

Q: How has e-business contributed to lower prices?

Q: What kind of questions should entrepreneurs ask before embarking on a new venture?

Q: The only goal of determining prices is to maximize profit for the firm.

Q: Identify at least three sources or areas where entrepreneurs can find ideas. What should entrepreneurs look for as they explore these idea sources?

Q: The breakeven point is the price at which a company earns the maximum profits.

Q: Variable costs of a product are those costs that change with the quantity of a product produced and sold.

Q: Discuss three of the seven potential sources of opportunity for entrepreneurial ventures.

Q: The financial data section of the business plan should contain projections for the first five years and a breakeven analysis.

Q: One advantage to marketers of selling online is that it is easier for sellers to hide prices and enjoy a large markup.

Q: If prices are set too high, the company will make a large profit on each item, but will sell fewer units.

Q: In a business plan, the analysis of the context is most closely related to the environmental scan.

Q: Which of the following represents the sales volume where total costs equal total revenue? A) Fixed costs B) Pricing analysis C) Skimming D) Variable costs E) Breakeven point

Q: The executive summary of a business plan is constructed to remind the executive of his plan for the new business

Q: The purpose of a business plan is to secure financing for the start-up.

Q: What is the amount added by a retailer to an item's purchase cost needed to make a profit? A) Gross B) Variable cost C) Breakeven D) Markup E) Fixed cost

Q: Which of the following is a primary advantage for the consumer when using the internet for shopping? A) Objective customer reviews B) Faster delivery C) Elimination of added costs of wholesalers and retailers D) Efficient use of corporate resources E) Cost-oriented pricing

Q: Competitive advantage is a necessary ingredient for an entrepreneurial venture's long-term success and survival.

Q: How do companies achieve continuous sales of more units and higher profits, even with lower unit prices? A) Market penetration B) E-business C) Profit-maximization strategies D) Market domination E) Market share

Q: An important difference between entrepreneurs and the rest of us is that entrepreneurs can see opportunities the rest of us miss.

Q: Which pricing objective has the goal of establishing market share? A) Market penetration B) E-business C) Brand recognition D) Brand licensing E) Profit-maximizing

Q: Farrah has created a computer-generated mockup of her new product for inclusion in the ________ section of her business plan. A) supporting documentation B) executive summary C) analysis of the context D) description of the business

Q: Which of the following best describes pricing objectives? A) The need for the company to compete B) An indication of the company's social and ethical concerns C) A reflection of the company's image D) The ability of a firm to generate revenue E) The goals of the seller achieved by pricing products

Q: Which of the following best defines fixed costs? A) Costs that are needed to acquire a fixed market share B) Costs that are needed to acquire fixed profits C) Costs that are unaffected by the number of goods sold by the firm D) Costs that remain the same from year to year E) Costs that remain the same across all products

Q: Emily is calculating her annual revenues, balance sheets, and breakeven points so she can write the ________ section of her business plan. A) description of the business B) executive summary C) financial data and projections D) analysis of the context

Q: Which one of the following items is found in the financial data section of the business plan? A) pricing B) economic analysis C) sales tactics D) pro forma cash flow analysis

Q: Which of the following gives the correct formula for calculating markup percentage? A) Sales price/markup B) Sales price/fixed costs C) Fixed costs/variable costs D) Markup/sales price E) Sales price/variable costs

Q: The marketing plan becomes a part of the ________ section of the business plan. A) description of the business B) executive summary C) analysis of the context D) supporting documentation

Q: The sales price of a product is given as the product's cost to the seller plus which of the following quantities? A) Breakeven price B) Revenues C) Variable price D) Fixed point E) Markup

Q: Before launching his new venture, Doyle is studying the potential competitors for his new product. He will want to find an answer to which one of the following questions? A) How do they finance their operations? B) What competitive advantage do they have? C) Where are they located? D) How many employees do they have?

Q: Companies who price their product low enough to attract a large number of buyers are most likely pursuing which of the following objectives? A) Stable market pricing B) High profits C) Stable market activity D) Low market volatility E) Market share

Q: Dharma is examining her financial position, the market for her proposed new product, the types of ownership available to her, and the tax laws for her area to determine whether she should go forward with her new business. Dharma is conducting a ________ A) market analysis B) technical study C) practicality study D) feasibility study

Q: Which of the following costs refers specifically to those that are unaffected by the quantity of a product sold or produced? A) Annual costs B) Variable costs C) Fixed costs D) Marginal costs E) Market-adjusted costs

Q: Which one of the following would most likely be a source for ideas for the would-be entrepreneur? A) manufacturing exhibitions B) trade publications C) personal interests and hobbies D) pure research

Q: Which of the following costs refers specifically to those that change with the quantity of a product sold or produced? A) Annual costs B) Variable costs C) Fixed costs D) Marginal costs E) Market-adjusted costs

Q: In 1938 Dr. Roy Plunkett discovered that a certain material became very slippery when frozen, and PTFE was invented. Under the brand Teflon, PTFE coatings were applied to a wide variety of items from spacecraft to frying pans. DuPont was able to capitalize on ________. A) the incongruous B) the unexpected C) new knowledge D) process needs

Q: Which of the following terms refers to the monetary amount added to a product's cost to the seller in order to sell it at a target profit? A) Profit margin B) Breakeven cost C) Revenue D) Revenue margin E) Markup

Q: Decades ago only former military personnel and hoodlums sported tattoos. Today tattoos are considered an art form, giving rise to a plethora of tattoo shops. These body artists have taken advantage of changes in ________. A) demographics B) market structure C) perception D) processes

Q: Describe the three types of brand names and give an example of each.

Q: Recognizing the increase in birth rates since 1946, and disliking the task of changing his grandchildren's diapers, Victor Mills began developing a disposable diaper. Pampers were introduced to consumers in 1961. Mills saw opportunity in ________. A) changes in demographics B) changes in perceptions C) new knowledge D) the incongruous

Q: What is branding? Explain what branding is and give an example of branding.

Q: Before Henry Ford and Frederick W. Taylor collaborated, automobiles were built by craftsmen, one at a time. After the establishment of the assembly line, Ford was able to produce automobiles faster than his competitors. but with equivalent quality. and sell them for a fraction of the cost. Ford saw opportunity in ________. A) industry structure B) the unexpected C) changing perceptions D) demographic shifts

Q: Describe three ways to extend a product's life as it nears the end of the maturity stage.

Q: In the days before sterile adhesives, bandages were tied onto the patient. Next came adhesive tape with small squares of gauze attached, but making these in the doctors' office was tedious and time consuming. Finally Earle Dickson invented the Band-Aid for his wife, who needed a bandage she could apply to herself for small kitchen burns. Dickson saw ________. A) the unexpected B) a new industry C) new knowledge D) a process need

Q: Product X is just beginning to generate a profit for the first time as the manufacturer lowers prices slightly and sees a significant increase in sales. At what stage in the product life cycle is Product X, and how is this stage identified?

Q: "Put a motor on a bicycle? You must be crazy!" Yet that is exactly what William Harley and Walter Davidson did. These two founders of the best-known American motorcycle company saw opportunity in ________. A) the incongruous B) the unexpected C) demographics D) changes in perception

Q: With product adaptation, the product is modified for greater appeal in different countries.

Q: Arthur Fry thought his glue was a failure because it didn't stick permanently, but when applied to small squares of paper, it became the popular Post-It note. Arthur Fry took advantage of ________. A) a process need B) the unexpected C) a market structure D) changes in perception

Q: After a product has been in the maturity stage for a few years, marketers must accept that the product will begin to decline.

Q: Compare and contrast self-employment and entrepreneurship.

Q: Explain the differences between an entrepreneurial venture and a small business.

Q: The product life cycle describes the commercial life of services as well as goods.

Q: Product placement includes showing actors on television shows using a name-brand product.

Q: After the venture is launched, the entrepreneur continues with the same activities as before the launch.

Q: Packaging can serve as an in-store advertisement that makes the product attractive, displays the brand name, and identifies features and benefits.

Q: Organizing an entrepreneurial venture involves, among other activities, choosing a legal form of business organization.

Q: Sears' Craftsman Tools is an example of a private brand.

Q: Among the more important pre-launch activities the entrepreneur must perform is the creation of a business plan.

Q: A private brand is a brand name developed by a wholesaler or retailer for their product.

Q: Exploring the entrepreneurial context includes scanning the economic, political/legal, social, and work environment.

Q: How do customers most benefit from packaging design? A) Increased utility B) In-store advertisements C) Less spoilage D) Reduced risk of damage E) Less theft of the product

Q: Entrepreneurship is important to a nation's economic development.

Q: Which of the following best describes a private label brand? A) A retailer uses packaging as a form of advertising. B) A retailer develops a brand name and has a manufacturer put it on a product. C) A manufacturer puts its name on an unrelated product for a fee. D) A brand name is used throughout a series of products made by the same manufacturer. E) A brand is reintroduced in a new, often global, market.

Q: Nearly half of all workers in the U.S. are employed by small businesses.

Q: Which of the following indicates a firm sold the rights to put their name on a product not produced by them? A) Asset brands B) National brands C) Licensed brands D) Private brands E) Private labels

Q: Despite their overall importance to the economy, small businesses account for fewer new jobs than large corporations.

Q: Which of the following best describes product placement? A) Placing products on the shelf where they receive the most attention B) Identifying specific products for viral marketing campaigns C) Placing products in movies and television shows D) Placing a national brand next to a store brand for better comparison E) Determining if a product should be sold only online or only in brick and mortar shops

Q: Entrepreneurships are more likely than large businesses to generate patentable ideas.

Q: In additional to social networking and viral marketing, how do firms successfully increase brand awareness? A) Reintroduction B) Globalization C) Rebranding D) Product placement E) Product extensions

Q: Innovation is a key aspect of entrepreneurship.

Q: What is one of the key benefits to successful branding? A) Brand extension B) Brand loyalty C) Preferred product placement D) Ease of licensing E) Ease in adaptation

Q: Entrepreneurship's importance can be shown mostly in three geographic areas in the United States: the Northeast, the South, and the Southwest.

Q: Using symbols and names to communicate the qualities of a product is a function of what? A) Awareness B) Reintroduction C) Product adaptation D) Product extension E) Branding