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ENTREPRENEURSHIP 2017 - Quiz Answer : Entrepreneurship: Successfully Launching New Ventures, 5e (Barringer/Ireland) - Chapter 9

Entrepreneurship and Start Up

ENTREPRENEURSHIP 2017 - Quiz Answer and Case Study Guides

Entrepreneurship: Successfully Launching New Ventures, 5e (Barringer/Ireland)

Quiz Answers and Case Guides

 

 

Entrepreneurship: Successfully Launching New Ventures, 5e (Barringer/Ireland)

Chapter 9   Building a New-Venture Team

 

1) The fact that companies often falter because the people who start the firms can't adjust quickly enough to their new roles and because the firm lacks a "track record" with outside buyers and sellers, is referred to as the ________.

  1. A) liability of preparedness
  2. B) liability of newness
  3. C) burden of novelty
  4. D) burden of freshness
  5. E) millstone of innovation

Answer:  B

Diff: 2      Page Ref: 296

LO:  9.1: Explain the concept called liability of newness.

AACSB:  Refl7.3ective Thinking

 

2) Savanna Combs opened a clothing boutique two years ago. Unfortunately, the boutique failed after 18 months. Savanna attributes the failure of her boutique to the facts that her employees couldn't adjust quickly enough to their new roles and that her boutique lacked a "track record" with outside buyers and sellers, which made it difficult to form partnerships and make sales. Savanna suffered from what research calls the ________.

  1. A) burden of novelty
  2. B) millstone of innovation
  3. C) liability of newness
  4. D) liability of preparedness
  5. E) burden of newness

Answer:  C

Diff: 2      Page Ref: 297

LO:  9.1: Explain the concept called liability of newness.

AACSB:  Reflective Thinking

 

3) The high failure rate among new ventures is due, in part, to the liability of newness, which refers to the fact that new companies often falter because ________.

  1. A) they are underfunded and the founders of the firms don't move quickly enough to put together boards of directors and boards of advisors that can provide them direction and advice
  2. B) the founders of the firms underestimate the complexities involved with starting a new business and the firms lack a "track record" with outside buyers and sellers
  3. C) the people who start the firms can't adjust quickly enough to their new roles and the firms lack a "track record" with outside buyers and sellers
  4. D) the people who start the firms can't adjust quickly enough to their new roles and they are underfunded
  5. E) the founders of the firms underestimate the complexities involved with starting a new business and they don't move quickly enough to establish business partnerships

Answer:  C

Diff: 2      Page Ref: 297

LO:  9.1: Explain the concept called liability of newness.

AACSB:  Reflective Thinking

4) The Partnering for Success feature in Chapter 9 focuses on a technique that entrepreneurs use to overcome the liabilities of newness. The suggestion made by the feature is to overcome the liabilities of newness by considering ________.

  1. A) interviewing a minimum of 20 startup founders to get a sense of what made them successful
  2. B) working in the new product development or corporate innovation division of a major corporation
  3. C) working for a startup for a minimum of two years before starting one
  4. D) earning an MBA
  5. E) joining a startup accelerator

Answer:  E

Diff: 3      Page Ref: 298

LO:  9.1: Explain the concept called liability of newness.

AACSB:  Analytical Thinking

 

5) The term "liability of newness" refers to the fact that companies often falter because the people who start the firms can't adjust quickly enough to their new roles and because the firms lack "track records" with outside buyers and suppliers.

Answer:  TRUE

Diff: 2      Page Ref: 296

LO:  9.1: Explain the concept called liability of newness.

AACSB:  Reflective Thinking

 

6) Describe the term "liability of newness" and suggest several ways that a new venture can overcome this handicap.

Answer:  The term "liability of newness" refers to the fact that companies often falter because the people who start them aren't able to adjust quickly enough to their new roles and because the firms lack "track records" with outside buyers and suppliers. Assembling a talented and experienced new venture team is one path firms can take to overcome these limitations. In addition, firms able to persuade high-quality individuals to join them as directors or advisers quickly gain legitimacy with a variety of individuals, such as some of those working inside the venture as well as some people outside the venture (e.g., suppliers, customers, and investors). In turn, legitimacy opens doors that otherwise would be closed.

Diff: 2      Page Ref: 297

LO:  9.1: Explain the concept called liability of newness.

AACSB:  Reflective Thinking

 

 

7) Next Big Sound, the company profiled in the opening feature of Chapter 9, is a music analytics company. Which of the following statements in incorrect regarding Next Big Sound's co-founders, its personnel policies or the company itself?

  1. A) Next Big Sound has three co-founders.
  2. B) The co-founders have healthy debates, but are able to come to consensus and get along and trust one another.
  3. C) Because the co-founders could not agree who would be the company's CEO, the three share the title of co-CEOs.
  4. D) The idea for Next Big Sound was created at a Startup Weekend event in San Francisco.
  5. E) The firm is in located in New York, New York.

Answer:  D

Diff: 2      Page Ref: 296

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

8) A ________ is the group of founders, key employees, and advisers that move a new venture from an idea to a fully functioning firm.

  1. A) new venture panel
  2. B) startup team
  3. C) new venture team
  4. D) new project team
  5. E) startup cadre

Answer:  C

Diff: 2      Page Ref: 296

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

9) Kathy Denver is preparing to launch a home security firm. The team of people that will launch Kathy's firm are as follows: Kathy (CEO), Trevor (VP-Finance), Shelia (VP-Sales), a four-person Board of Directors, a five-person Board of Advisors, and Kathy's primary investor, who will assume an advisory role. The group of people that will launch Kathy's firm is called its ________.

  1. A) startup squad
  2. B) new venture panel
  3. C) new venture team
  4. D) startup cadre
  5. E) startup troop

Answer:  C

Diff: 1      Page Ref: 296

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

 

10) Which of the following was not identified in the textbook as an element of a new venture team?

  1. A) Board of advisors
  2. B) Suppliers and vendors
  3. C) Key employees
  4. D) Lenders and investors
  5. E) Management team

Answer:  B

Diff: 2      Page Ref: 297

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

11) According to the textbook, studies show that more than one individual starts ________ percent of all new firms.

  1. A) 20 to 25
  2. B) 50 to 70
  3. C) 5 to 15
  4. D) 30 to 40
  5. E) 75 to 90

Answer:  B

Diff: 3      Page Ref: 300

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

12) Which of the following statements is untrue regarding founding teams?

  1. A) The members of heterogeneous teams are diverse in terms of their abilities and experiences.
  2. B) The members of homogenous teams are very similar in terms of their abilities and experiences.
  3. C) Teams that have worked together before have an edge.
  4. D) Studies show that more than one individual starts 50 to 70 percent of all new firms.
  5. E) It is generally believed that new ventures started by an individual have an advantage over new ventures started by a team.

Answer:  E

Diff: 2      Page Ref: 300

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

 

13) Which of the following statements is incorrect regarding founding teams?

  1. A) The members of heterogeneous teams are diverse in terms of their abilities and experiences.
  2. B) Teams that are working together for the first time have an advantage over teams that have worked together before.
  3. C) The psychological support that cofounders of a new business can offer one another is an important element of a firm's success.
  4. D) The members of homogeneous teams are very similar in terms of their abilities and experiences.
  5. E) Studies show that more than one individual starts 50 to 70 percent of all new teams.

Answer:  B

Diff: 2      Page Ref: 300

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

14) The members of heterogeneous teams are ________.

  1. A) diverse in terms of their abilities and experiences
  2. B) diverse in terms of their abilities, but very similar in terms of their experiences
  3. C) similar in terms of their abilities and experiences
  4. D) diverse in terms of their experiences, but very similar in terms of their abilities
  5. E) sometimes diverse in terms of their abilities and experiences and sometimes similar along the same dimensions

Answer:  A

Diff: 2      Page Ref: 300

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

15) The members of homogeneous teams are ________ in terms of their ________.

  1. A) diverse; abilities and experiences
  2. B) diverse; abilities, but very similar in terms of their experiences
  3. C) similar; abilities and experiences
  4. D) diverse; experiences, but very similar in terms of their abilities
  5. E) sometimes diverse; abilities and experiences and sometimes similar along the same dimensions

Answer:  C

Diff: 2      Page Ref: 300

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

16) According to the textbook, which of the following statements is inaccurate regarding the size and composition of the founding team of a firm?

  1. A) There is no relationship between a founding team's size and its effectiveness.
  2. B) A founding team larger than four people is typically too large to be practical.
  3. C) The members of a homogeneous founding team are similar in terms of their abilities and experiences.
  4. D) The members of a heterogeneous founding team are diverse in terms of their abilities and experiences.
  5. E) A founding team can be too big, causing communication problems and increasing potential for conflict.

Answer:  A

Diff: 2      Page Ref: 300

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

17) According to the textbook, prior entrepreneurial experience ________.

  1. A) is one of the poorest predictors of future entrepreneurial performance
  2. B) is one of the most consistent predictors of future entrepreneurial performance for entrepreneurs under 50 years of age, but not for entrepreneurs over 50 years of age
  3. C) is one of the most consistent predictors of future entrepreneurial performance
  4. D) is one of the most consistent predictors of future entrepreneurial performance in service firms, but not in manufacturing firms
  5. E) has no relationship to future entrepreneurial performance

Answer:  C

Diff: 2      Page Ref: 301

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

18) Which of the following statements is not true regarding the attributes of the founder(s) of a firm?

  1. A) Evidence suggests that important entrepreneurial skills are enhanced through higher education.
  2. B) Founders with prior entrepreneurial experience are more likely to avoid costly mistakes.
  3. C) Founders with experience in the same industry as their new ventures will typically have "blinders" on and are typically not as effective as founders new to the industry.
  4. D) Founders with broad social and professional networks have an advantage.
  5. E) New ventures that are started by a team rather than an individual have an advantage.

Answer:  C

Diff: 2      Page Ref: 301

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

19) Which of the following qualities was not identified in the textbook as a preferred attribute of the founder(s) of a firm?

  1. A) Prior entrepreneurial experience
  2. B) Firm started by a team
  3. C) Relevant industry experience
  4. D) Prior experience working in a government or university position
  5. E) Higher education

Answer:  D

Diff: 2      Page Ref: 301

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

20) The What Went Wrong feature in Chapter 9 focuses on Deever, a 2008 startup that helped software developers use cloud-based services to "test" their code in an expedient manner. According to the feature, one of the primary reasons Deever failed was ________.

  1. A) it lacked a cofounder who loved the business side of running a startup
  2. B) the cofounders couldn't get along
  3. C) it didn't build a robust partnership network
  4. D) it didn't solicit advice from attorneys, bankers or business consultants
  5. E) it didn't have a Board of Advisors

Answer:  A

Diff: 2      Page Ref: 302

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

21) The process of building and maintaining relationships with people whose interests are similar or whose relationship could bring advantages to the firm is called ________.

  1. A) linking
  2. B) socializing
  3. C) networking
  4. D) associating
  5. E) connecting

Answer:  C

Diff: 2      Page Ref: 303

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

 

22) Sam Simpson is a four time business owner. One thing that has served Sam well throughout his entrepreneurial career is his ability to build and maintain relationships with people whose interests are similar or whose relationships could bring advantages to his new ventures. According to the textbook, Sam is a good ________.

  1. A) networker
  2. B) socializer
  3. C) linker
  4. D) assembler
  5. E) connector

Answer:  A

Diff: 2      Page Ref: 303

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

23) A(n) ________ is a chart that depicts the most important skills that are needed in a new venture and where skills gaps exist.

  1. A) expertise report
  2. B) talent profile
  3. C) abilities summary
  4. D) skills profile
  5. E) talent summary

Answer:  D

Diff: 2      Page Ref: 304

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

24) Jason Andersen just finished writing a business plan for a new type of office supply store. One thing Jason included in the "Management Team & Company Structure" section of his business plan is a chart that depicts the most important skills that are needed for his business and where skills gaps exist. Jason included a(n)________ in his business plan.

  1. A) skills profile
  2. B) talent report
  3. C) abilities profile
  4. D) expertise report
  5. E) talent summary

Answer:  A

Diff: 2      Page Ref: 304

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

 

25) A skills profile is a chart that depicts the ________.

  1. A) preferable skills and abilities of the members of a firm's board of advisors
  2. B) preferable skills and abilities of the members of a firm's board of directors
  3. C) most important skills that are needed in a business startup and where skills gaps exist
  4. D) skills and abilities that will be needed for a firm to maintain an aggressive growth strategy
  5. E) skills of a company's customers and how those skills impact the products and services a company provides

Answer:  C

Diff: 2      Page Ref: 304

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

26) The Savvy Entrepreneurial Firm feature in Chapter 9 focuses on how business founders overcome a lack of business experience. Which of the following was not mentioned as a practical way for a new business founder to overcome a lack of business experience?

  1. A) Hiring consultants from a major consulting firm (e.g., Bain & Company or McKinsey & Company)
  2. B) Taking on a partner that has business experience
  3. C) Getting help from a Small Business Development Center
  4. D) Joining a Meetup group
  5. E) Participating in online forums

Answer:  A

Diff: 2      Page Ref: 305

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Analytical Thinking

27) A(n) ________ is a person who works for a business as an apprentice or trainee for the purpose of obtaining actual experience.

  1. A) freelancer
  2. B) consultant
  3. C) intern
  4. D) virtual assistant
  5. E) novice

Answer:  C

Diff: 2      Page Ref: 306

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

 

28) A(n) ________ is a person who is in business for themselves, works on their own time with their own tools and equipment, and performs services for a number of different clients.

  1. A) employee
  2. B) virtual assistant
  3. C) intern
  4. D) trainee
  5. E) freelancer

Answer:  E

Diff: 2      Page Ref: 306

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

29) Calvin Tucker is in the process of launching an educational services firm. He plans to incorporate the firm. Because the firm will be incorporated, Calvin is legally required to have a ________.

  1. A) board of investors
  2. B) board of advisors
  3. C) customer advisory board
  4. D) board of directors
  5. E) panel of advisors and peers

Answer:  D

Diff: 2      Page Ref: 307

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

30) A board of directors is typically made up of both ________ and ________ directors.

  1. A) junior; senior
  2. B) inside; outside
  3. C) experienced; inexperienced
  4. D) novice; expert
  5. E) paid; unpaid

Answer:  B

Diff: 2      Page Ref: 307

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

31) In the context of boards of directors, a(n) ________ director is a person who is also an officer of the firm.

  1. A) outside
  2. B) junior
  3. C) inside
  4. D) expert
  5. E) senior

Answer:  C

Diff: 2      Page Ref: 307

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

32) In the context of boards of directors, a(n) ________ director is someone who is not employed by the firm.

  1. A) outside
  2. B) inside
  3. C) external
  4. D) impartial
  5. E) peripheral

Answer:  A

Diff: 2      Page Ref: 307

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

33) James Williams is the Chief Operating Officer of a startup in the health food industry. He is also a member of his firm's board of directors. In board of directors terminology, James is a(n) ________ director.

  1. A) inside
  2. B) outside
  3. C) expert
  4. D) junior
  5. E) senior

Answer:  A

Diff: 2      Page Ref: 307

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

34) Adam Miller is a general partner in a venture capital firm that just funded Gold Coast Software, a software firm in Santa Barbara, California. Gold Coast Software is incorporated, and Adam has taken a seat on the firm's board of directors. In board of directors terminology, Keith is a(n) ________ director.

  1. A) subordinate
  2. B) senior
  3. C) distant
  4. D) inside
  5. E) outside

Answer:  E

Diff: 2      Page Ref: 307

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

35) A board of directors' three formal responsibilities are to ________.

  1. A) periodically update the firm's business plan, declare dividends, and write the firm's marketing plan
  2. B) appoint the officers of the firm, declare dividends, and oversee the affairs of the corporation
  3. C) write the firm's strategic plan, declare dividends, and conduct the annual meeting
  4. D) appoint the officers of the firm, conduct the annual meeting, and submit the firm's annual report to the Securities & Exchange Commission
  5. E) provide funding to the firm, write the firm's strategic plan, and submit the firm's annual report to the Securities & Exchange Commission

Answer:  B

Diff: 2      Page Ref: 307

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

36) A board of directors' three formal responsibilities are to appoint the officers of the firm, oversee the affairs of the corporation, and ________.

  1. A) conduct the annual meeting
  2. B) provide funding for the firm
  3. C) submit the firm's annual report to the stockholders
  4. D) declare dividends
  5. E) write the firm's strategic plan

Answer:  D

Diff: 2      Page Ref: 307

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Analytical Thinking

 

37) A board of directors' three formal responsibilities are to appoint the officers of the firm, declare dividends, and ________.

  1. A) write the firm's strategic plan
  2. B) conduct the annual meeting
  3. C) provide funding for the firm
  4. D) represent the firm in public relations activities
  5. E) oversee the affairs of the corporation

Answer:  E

Diff: 2      Page Ref: 307

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

 

38) Which of the following statements is incorrect regarding boards of directors?

  1. A) If a new venture organizes as a corporation, it is not legally required to have a board of directors, but it is strongly recommended.
  2. B) A board is typically made up of both inside and outside directors.
  3. C) The board is responsible for declaring dividends.
  4. D) Most boards meet formally three or four times a year.
  5. E) The boards for publicly-traded companies are required by law to have audit and compensation committees.

Answer:  A

Diff: 2      Page Ref: 307

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

39) According to the textbook, although a board of directors has formal governance responsibilities, its most useful role is to ________.

  1. A) provide guidance and support to the firm's managers
  2. B) submit papers on behalf of the firm to the SEC
  3. C) represent the firm in public relations activities
  4. D) conduct the firm's annual meeting
  5. E) provide funding to the firm

Answer:  A

Diff: 2      Page Ref: 308

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

40) Liz Zackery just launched a firm in the sporting goods industry. On the day the company was launched, Liz issued a press release, indicating that the vice president of New Balance, a highly respected athletic shoe and sports apparel company, had agreed to serve on her board of directors. Liz knows that such a high quality appointment will send an important message to her potential clientele. This phenomenon is referred to as ________.

  1. A) championing
  2. B) signaling
  3. C) profiling
  4. D) indicating
  5. E) trumping

Answer:  B

Diff: 2      Page Ref: 308

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

 

41) Melissa Jones just launched a firm in the wireless communications industry. Shortly after the company was launched, Melissa announced that a prominent Silicon Valley venture capitalist had agreed to serve on her board of directors. Melissa knows that such a high quality appointment will send an important message to her potential business partners and clientele. This phenomenon is referred to as ________.

  1. A) trumping
  2. B) championing
  3. C) profiling
  4. D) signaling
  5. E) indicating

Answer:  D

Diff: 2      Page Ref: 308

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

42) Which of the following was not identified in the textbook as an attribute of an effective board of directors?

  1. A) Homogeneous set of experiences and talents
  2. B) Customer-focused point of view
  3. C) Ability and willingness to stand up to the CEO and top managers of the firm
  4. D) Strong communication with the CEO
  5. E) Decisiveness

Answer:  A

Diff: 2      Page Ref: 308

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

43) Which of the following was not identified in the textbook as an attribute of an effective board member?

  1. A) Strong personal and professional networks
  2. B) Unknown in their field
  3. C) Investment and/or operating experience
  4. D) Ability and willingness to mentor the CEO and the top managers of the firm
  5. E) Pattern recognition skills

Answer:  B

Diff: 2      Page Ref: 308

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

44) A new venture team is the group of founders, key employees, and advisers that move a new venture from an idea to a fully functioning firm.

Answer:  TRUE

Diff: 1      Page Ref: 296

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

 

45) Studies show that more than one individual starts 50 to 70 percent of all new firms.

Answer:  TRUE

Diff: 3      Page Ref: 300

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

46) It is generally believed that new ventures started by an individual have an advantage over those started by a team.

Answer:  FALSE

Diff: 2      Page Ref: 300

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

47) Founding teams that have worked together before, as opposed to teams that are working together for the first time, have an edge.

Answer:  TRUE

Diff: 2      Page Ref: 300

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

48) Homogeneous teams are diverse in terms of their abilities and experiences.

Answer:  FALSE

Diff: 2      Page Ref: 300

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

49) Prior entrepreneurial experience, relevant industry experience, and networking are attributes that strengthen the chances of a founder's success.

Answer:  TRUE

Diff: 2      Page Ref: 301

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

50) Prior entrepreneurial experience is a poor predictor of future entrepreneurial performance.

Answer:  FALSE

Diff: 2      Page Ref: 301

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

51) Networking is building and maintaining relationships with people whose interests are similar or whose relationship could bring advantages to a firm.

Answer:  TRUE

Diff: 2      Page Ref: 303

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

 

52) A skills profile is a chart that depicts the most important skills that are needed and where skills gaps exist.

Answer:  TRUE

Diff: 2      Page Ref: 304

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

53) A virtual assistant is a freelancer who provides administrative, technical, or creative assistance to clients remotely from a home office.

Answer:  TRUE

Diff: 2      Page Ref: 306

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

54) Although a board of directors has formal governance responsibilities, its most useful role is to provide guidance and support to the firm's managers.

Answer:  TRUE

Diff: 2      Page Ref: 308

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

55) Are more firms started by individuals or founding teams? What are the advantages to founding a firm as a team rather than as an individual?

Answer:  Studies show that more than one individual starts 50 to 70 percent of all new firms. It is generally believed that new ventures started by a team have an advantage over those started by an individual because a team brings more talent, resources, ideas, and professional contacts to a new venture than does a sole entrepreneur. In addition, the psychological support that cofounders of a new business can offer one another is an important element in the firm's success.

Diff: 2      Page Ref: 300

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

56) What is the difference between a heterogeneous and a homogeneous founding team? Which type of team has the advantage?

Answer:  Heterogeneous founding teams are diverse in terms of their abilities and experiences. Homogeneous founding teams are very similar on the same dimensions. Heterogeneous teams typically have the advantage. The members of heterogeneous teams are likely to have different points of view about technology, hiring, decisions, competitive tactics, and other important activities. These different points of view are likely to generate debate and constructive conflict among the founders, reducing the likelihood that decisions will be made in haste or without the airing of alternative points of view.

Diff: 2      Page Ref: 300

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

 

57) What is a skills profile and what is it used for?

Answer:  A skills profile is a chart that depicts the most important skills that are needed in a startup (e.g., executive leadership, finance, operations, human resources) on the horizontal axis and lists the members of the new venture team and the skills that each individual contributes on the vertical axis. The idea is to see whether the skills that are needed to launch a firm are adequately covered by the members of the new venture team, or whether skills gaps exist that need to be filled.

Diff: 2      Page Ref: 304

LO:  9.2: Describe a new-venture team and discuss the primary elements that form such a team.

AACSB:  Reflective Thinking

 

58) A(n) ________ is a panel of experts who are asked by a firm's managers to provide counsel and advice on an ongoing basis.

  1. A) consultation board
  2. B) idea panel
  3. C) counseling panel
  4. D) advisory board
  5. E) suggestion panel

Answer:  D

Diff: 2      Page Ref: 310

LO:  9.3: Identify professional advisers and explain their role with a new-venture team.

AACSB:  Reflective Thinking

59) Shelly Cook recently launched a social network for chefs. One thing Shelly is thinking about is creating is a panel of experts who can provide her ongoing direction and advice regarding the future of her business. Shelly is thinking about creating a(n) ________.

  1. A) analysis panel
  2. B) discussion board
  3. C) advisory board
  4. D) suggestion panel
  5. E) accountability panel

Answer:  C

Diff: 2      Page Ref: 310

LO:  9.3: Identify professional advisers and explain their role with a new-venture team.

AACSB:  Reflective Thinking

 

 

60) Kelly Andersen founded a technology consulting firm several years ago. Her firm has grown rapidly and is financially successful. One thing that Kelly attributes her success to is that early on she assembled a panel of experts who provided her ongoing direction and advice about her business. What Kelly created is called a(n) ________.

  1. A) consultation panel
  2. B) suggestion panel
  3. C) idea board
  4. D) accountability panel
  5. E) advisory board

Answer:  E

Diff: 2      Page Ref: 310

LO:  9.3: Identify professional advisers and explain their role with a new-venture team.

AACSB:  Reflective Thinking

 

61) Which of the following statements about advisory boards is incorrect?

  1. A) The fact that a corporation has a board of directors does not preclude it from establishing one or more advisory boards.
  2. B) An advisory board can be established for general purposes or can be set up to address a specific issue or need.
  3. C) Similar to a board of directors, an advisory board has legal responsibility for the firm in certain areas.
  4. D) An advisory board is a panel of experts who are asked by a firm's managers to provide counsel and advice on an ongoing basis.
  5. E) A growing number of startups are forming advisory boards.

Answer:  C

Diff: 2      Page Ref: 310

LO:  9.3: Identify professional advisers and explain their role with a new-venture team.

AACSB:  Reflective Thinking

62) Which of the following statements about advisory boards is incorrect?

  1. A) If a firm has a board of directors, it is not permitted to have an advisory board.
  2. B) Many people are more willing to serve on a company's board of advisors than its board of directors because it requires less time and there is no potential legal liability involved.
  3. C) Most boards of advisers have between 5 and 15 members.
  4. D) A growing number of startups are forming advisory boards.
  5. E) An advisory board can be established for general purposes or can be set up to address a specific issue or need.

Answer:  A

Diff: 2      Page Ref: 310

LO:  9.3: Identify professional advisers and explain their role with a new-venture team.

AACSB:  Reflective Thinking

 

 

63) According to the textbook, most boards of advisers have between ________ and ________ members.

  1. A) 5; 15
  2. B) 2; 4
  3. C) 10; 18
  4. D) 2; 3
  5. E) 4; 7

Answer:  A

Diff: 3      Page Ref: 310

LO:  9.3: Identify professional advisers and explain their role with a new-venture team.

AACSB:  Reflective Thinking

 

64) An advisory board is a panel of experts who are asked by a firm's managers to provide counsel and advice on an ongoing basis.

Answer:  TRUE

Diff: 1      Page Ref: 310

LO:  9.3: Identify professional advisers and explain their role with a new-venture team.

AACSB:  Reflective Thinking

 

65) Similar to a board of directors, an advisory board possesses legal responsibility for the firm.

Answer:  FALSE

Diff: 2      Page Ref: 310

LO:  9.3: Identify professional advisers and explain their role with a new-venture team.

AACSB:  Reflective Thinking

 

66) An advisory board can be established for general purposes or can be set up to address a specific need.

Answer:  TRUE

Diff: 2      Page Ref: 310

LO:  9.3: Identify professional advisers and explain their role with a new-venture team.

AACSB:  Reflective Thinking

 

67) The fact that a corporation has a board of directors precludes it from having a board of advisors.

Answer:  FALSE

Diff: 2      Page Ref: 310

LO:  9.3: Identify professional advisers and explain their role with a new-venture team.

AACSB:  Reflective Thinking

68) Most boards of advisers have between 3 and 5 members.

Answer:  FALSE

Diff: 3      Page Ref: 310

LO:  9.3: Identify professional advisers and explain their role with a new-venture team.

AACSB:  Reflective Thinking

 

 

69) More people are willing to serve on a company's board of directors than board of advisors.

Answer:  FALSE

Diff: 3      Page Ref: 311

LO:  9.3: Identify professional advisers and explain their role with a new-venture team.

AACSB:  Reflective Thinking

 

70) A business ________ is an individual who gives professional or expert advice, on a volunteer or fee basis.

  1. A) consultant
  2. B) intern
  3. C) employee
  4. D) virtual assistant
  5. E) mentor

Answer:  E

Diff: 2      Page Ref: 313

LO:  9.4: Explain why a new-venture team might use consultants to obtain advice.

AACSB:  Reflective Thinking

 

71) Which of the following is incorrect regarding the typical role of consultants in business startups?

  1. A) Give professional advice
  2. B) International consulting firms (e.g., Accenture and Bearing Point) are financially beyond the reach of most small firms.
  3. C) Consultants fall into two categories—paid consultants and consultants who are made available for free.
  4. D) Give expert advice
  5. E) Help manage the day-to-day activities of the firm

Answer:  E

Diff: 2      Page Ref: 313

LO:  9.4: Explain why a new-venture team might use consultants to obtain advice.

AACSB:  Reflective Thinking

 

72) Consultants fall into two categories-paid consultants and consultants who are made available for free or at a reduced rate through a nonprofit or government agency.

Answer:  TRUE

Diff: 2      Page Ref: 313

LO:  9.4: Explain why a new-venture team might use consultants to obtain advice.

AACSB:  Reflective Thinking

 

73) SCORE is a for-profit organization that provides consulting services to small businesses.

Answer:  FALSE

Diff: 2      Page Ref: 313

LO:  9.4: Explain why a new-venture team might use consultants to obtain advice.

AACSB:  Reflective Thinking

 

74) What is SCORE? What is its role in helping a firm fill out its new venture team?

Answer:  SCORE is a nonprofit organization that provides free consulting services to small businesses. SCORE currently has over 11,000 volunteers who are typically retired business owners and who counsel in areas as diverse as finance, operations, and sales. SCORE helps a business fill out its new venture team by providing important advice and direction in areas that the new venture cannot provide for itself.

Diff: 2      Page Ref: 313

LO:  9.4: Explain why a new-venture team might use consultants to obtain advice.

AACSB:  Reflective Thinking

 

 

-----
Entrepreneurship: Starting and Operating A Small Business, 4th Edition, 2016, Steve Mariotti
Entrepreneurship: Successfully Launching New Ventures, 5th Edition, 2016, Bruce R. Barringer
Essentials of Entrepreneurship and Small Business Management, 8th Edition, 2016, Norman M. Scarborough
Fundamentals for Becoming a Successful Entrepreneur: From Business Idea to Launch and Management, 2016, Malin Brannback, Alan Carsrud
Entrepreneurship and Effective Small Business Management, 11th Edition, 2015, Norman M. Scarborough

------
PART 1: Decision to Become an Entrepreneur
1. Introduction to Entrepreneurship
PART 2: Developing Successful Business Ideas
3. Feasibility Analysis
4. Developing an Effective Business Model
5. Industry and Competitor Analysis
6. Writing a Business Plan
PART 3: Moving from an Idea to an Entrepreneurial Firm
7. Preparing the Proper Ethical and Legal Foundation
8. Assessing a New Venture’s Financial Strength and Viability
9. Building a New-Venture Team
10. Getting Financing or Funding
PART 4: Managing and Growing an Entrepreneurial Firm
11. Unique Marketing Issues
12. The Importance of Intellectual Property
13. Preparing for and Evaluating the Challenges of Growth
14. Strategies for Firm Growth
15. Franchising

------
PART I. STARTING THE PROCESS
Chapter 1. Why Plan?
PART II. WHAT TO DO BEFORE THE BUSINESS PLAN IS WRITTEN
Chapter 2. Developing and Screening Business Ideas
Chapter 3. Feasibiity Analysis
PART III. PREPARING A BUSINESS PLAN
Chapter 4. Introductory Material, Executive Summary, and Description of the Business
Chapter 5. Industry Analysis
Chapter 6. Market Analysis
Chapter 7. Marketing Plan
Chapter 8. Management Team and Company Structure
Chapter 9. Operations Plan and Product (or Service) Design and Development Plan
Chapter 10. Financial Projections
PART IV. PRESENTING THE BUSINESS PLAN
Chapter 11. Presenting the Plan with Confidence

------
BRIEF CONTENTS
UNIT 1 Entrepreneurial Pathways
Chapter 1 Entrepreneurs Recognize Opportunities
Chapter 2 Franchising
Chapter 3 Finding Opportunity in an Existing Business
Chapter 4 The Business Plan: Road Map to Success
Honest Tea Business Plan
Unit 1 Case Study: Spanx
UNIT 2 Who Are Your Customers?
Chapter 5 Creating Business from Opportunity
Chapter 6 Exploring Your Market
Unit 2 Case Study: Kitchen Arts & Letters, Inc.
UNIT 3 Integrated Marketing
Chapter 7 Developing the Right Marketing Mix and Plan
Chapter 8 Pricing and Credit Strategies
Chapter 9 Integrated Marketing Communications
Chapter 10 Marketing Globally
Chapter 11 Smart Selling and Effective Customer Service
Unit 3 Case Study: Empact
UNIT 4 Show Me the Money: Finding, Securing, and Managing It
Chapter 12 Understanding and Managing Start-Up, Fixed, and Variable Costs
Chapter 13 Using Financial Statements to Guide a Business
Chapter 14 Cash Flow and Taxes
Chapter 15 Financing Strategy: Debt, Equity, or Both?
Unit 4 Case Study: Lee’s Ice Cream
UNIT 5 Operating a Small Business Effectively
Chapter 16 Addressing Legal Issues and Managing Risk
Chapter 17 Operating for Success
Chapter 18 Location, Facilities, and Layout
Chapter 19 Human Resources and Management
Unit 5 Case Study: ONLC
UNIT 6 Leadership, Ethics, and Exits
Chapter 20 Leadership and Ethical Practices
Chapter 21 Franchising, Licensing, and Harvesting: Cashing in Your Brand
Unit 6 Case Study: Honest Tea
Appendix 1 Sample Student Business Plan: University Parent, Inc.
Appendix 2 BizBuilder Business Plan
Appendix 3 Resources for Entrepreneurs
Appendix 4 Useful Formulas and Equations
------
Section 1: The Rewards and Challenges of Entrepreneurship
1. Entrepreneurs: The Driving Force Behind Small Business
2. Ethics and Social Responsibility: Doing the Right Thing
3. Creativity and Innovation: Keys to Entrepreneurial Success
4. Strategic Management and the Entrepreneur
Section 2: Launching a Venture: Entry Strategies
5. Choosing a Form of Ownership
6. Franchising and the Entrepreneur
7. Buying an Existing Business
8. New Business Planning Process: Feasibility Analysis, Business Modeling, and Crafting a Winning Business Plan
Section 3: Building a Marketing Plan
9. Building a Bootstrap Marketing Plan
10. Creative Use of Advertising and Promotion
11. Pricing and Credit Strategies
12. Global Marketing Strategies
13. E-Commerce and Entrepreneurship
Section 4: Building a Financial Plan
14. Creating a Solid Financial Plan
15. Managing Cash Flow
16. Sources of Equity Financing
17. Sources of Debt Financing
Section 5: Building an Operating Plan
18. Location, Layout, and Physical Facilities
19. Supply Chain Management
20. Managing Inventory
21. Staffing and Leading a Growing Company
Section 6: Legal Aspects of Small Business: Succession, Ethics, and Government Regulation
22. Management Succession and Risk Management Strategies in the Family Business
23. The Legal Environment: Business Law and Government Regulation
------
Section I: The Challenge of Entrepreneurship 
1. The Foundations of Entrepreneurship
2. Ethics and Social Responsibility: Doing the Right Thing
3. Inside the Entrepreneurial Mind: From Ideas to Reality
Section II: The Entrepreneurial Journey Begins
4. Conducting a Feasibility Analysis and Designing a Business Model
5. Crafting a Business Plan and Building a Solid Strategic Plan
6. Forms of Business Ownership and Buying an Existing Business
7. Franchising and the Entrepreneur
Section III: Launching the Business
8. Building a Powerful Bootstrap Marketing Plan
9. E-commerce and the Entrepreneur
10. Pricing and Credit Strategies
11. Creating a Successful Financial Plan
12. Managing Cash Flow
Section IV: Putting the Business Plan to Work: Sources of Funds
13. Sources of Financing: Equity and Debt
14. Choosing the Right Location and Layout
15. Global Aspects of Entrepreneurship
16. Building a New Venture Team and Planning the Next Generation
------

 

ENTREPRENEURSHIP 2017 - NEW COLLECTION 2016 - 2017

1. Youtube Playlist: See the collection of videos - www.youtube.com/ecomftu2012

2. Download Power Point Slides Free

Entrepreneurship: Starting and Operating A Small Business, 4th Edition, 2016, Steve Mariotti - LINK
Entrepreneurship: Successfully Launching New Ventures, 5th Edition, 2016, Bruce R. Barringer  - LINK
Essentials of Entrepreneurship and Small Business Management, 8th Edition, 2016, Norman M. Scarborough - LINK
Fundamentals for Becoming a Successful Entrepreneur: From Business Idea to Launch and Management, 2016, Malin Brannback - LINK
Entrepreneurship and Effective Small Business Management, 11th Edition, 2015, Norman M. Scarborough - LINK

 

For Test Bankz, Quiz Answers and Case study Guides, email toThis email address is being protected from spambots. You need JavaScript enabled to view it.

Good Luck and Success, Enjoy Your Study !

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