Management Chapter 6 Study Guide
Management Chapter 6 Study Guide
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This 2 page Study Guide was uploaded by Kiana Kelii on Saturday January 16, 2016. The Study Guide belongs to a course at a university taught by a professor in Fall. Since its upload, it has received 22 views.
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Date Created: 01/16/16
Kiana Kelii Management 201 28 October 2015 1. C Self-conﬁdence is among the personality characteristics commonly found among entrepreneurs. 2. A When an entrepreneur is comfortable with uncertainty and willing to take risks, these are indicators of someone with a high tolerance for ambiguity. 3. B Almost 99% of American businesses meet the deﬁnition of “small business” used by the Small Business Administration. 4. B When a business owner sells to another person the right to operate that business in another location, this is known as franchise. 5. B A small business owner who is concerned about passing the business on to heirs after retirement or death should prepare a formal succession plan. 6. A Among the most common reasons that new small business start-ups fail is intrapreneurship. 7. D When a new business is quick to capture a market niche before competitors, this is called ﬁrst-mover advantage. 8. A When a small business is just starting, the business owner is typically struggling to gain acceptance in the marketplace. 9. B A venture capitalist who receives an ownership share in return for investing in a new business is providing equity ﬁnancing. 10. A In debt ﬁnancing, the business owner borrows money as a loan that must eventually be paid, along with agreed-upon interest to the lender. 11. B Angel investors take ownership shares in new venture in return for providing the entrepreneur with critical start-up funds. 12. D Among the forms of small business ownership, a corporation protects the owners from any personal liabilities for business losses. 13. C The ﬁrst component of a good business plan is usually an executive summary. 14. B Current trends in small business ownership in the United States would most likely show that the majority of small businesses conduct some business by Internet. 15. D If a new venture has reached the point where it is pursuing the IPO, the ﬁrm is most likely successful enough that the public at large will buy it’s shares. 16. What is the relationship between diversity and entrepreneurship? ▯ Entrepreneurship is rich with diversity. Diversity is having an idea or an object with a wide variety of it. Entrepreneurship is the process of starting a business, typically a startup company offering an innovative product, process or service. 17. What are the major stages in the life cycle of an entrepreneurial ﬁrm, and what are the management challenges at each stage? ▯ The three stages in the life cycle are birth, breakthrough, and maturity. In the birth stage leaders are challenged to get customers, and ﬁnd money to keep the business going. In the breakthrough stage the challenges shift to becoming and staying proﬁtable, and managing growth. In the maturity stage, a leader is more focused on revising and maintaining a good business strategy and continuing success. 18. What are the advantages of a limited partnership form of a small business ownership? ▯ The advantage is that the partners may share in proﬁts, but their potential for losses is limited by the size of their original investments. 19. What is the difference, if any, between a venture capitalist and an angel investor? ▯ A venture capitalist makes a living by investing in and taking large ownership interests with the goal of large ﬁnancial gains. An Angel investor is an individual who is willing to make a ﬁnancial investment in return for some ownership of the new ﬁrm.
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