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ENTREPRENEURSHIP 2017 - Quiz Answer : Entrepreneurship: Successfully Launching New Ventures, 5e (Barringer/Ireland) - Chapter 14

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 14   Strategies for Firm Growth

 

1) Shake Smart, the company profiled in the opening feature of Chapter 14, sells nutritious smoothie-like shakes. The first place the shakes were sold was ________.

  1. A) at a pop-up store in the Memorial Union on the Iowa State University campus
  2. B) at a kiosk just outside the Aztec Center on the San Diego State University campus
  3. C) at concession stands in Spartan Stadium on the Michigan State University campus
  4. D) on central campus at the University of Nebraska campus
  5. E) in the Lory Student Center on the Colorado State University campus

Answer:  B

Diff: 2      Page Ref: 473

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Application of Knowledge

 

2) Shelby Collins owns a firm that designs and sells women's clothing. She is currently trying to grow her firm by developing new product lines. Shelby is pursuing a(n) ________ growth strategy.

  1. A) in-house
  2. B) center
  3. C) domestic
  4. D) external
  5. E) internal

Answer:  E

Diff: 1      Page Ref: 475

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Analytical Thinking

 

3) New product development, other product-related strategies, and international expansion are examples of ________ growth strategies.

  1. A) external
  2. B) domestic
  3. C) primary
  4. D) internal
  5. E) in-house

Answer:  D

Diff: 2      Page Ref: 475

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Application of Knowledge

 

 

4) Internally generated growth is often called organic growth because it does not rely on ________.

  1. A) outside intervention
  2. B) its own skills and capabilities
  3. C) external funding
  4. D) internal leadership
  5. E) internal design expertise

Answer:  A

Diff: 2      Page Ref: 475

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Analytical Thinking

5) Which of the following is an example of an external growth strategy?

  1. A) Geographic expansion
  2. B) Improving an existing product or service
  3. C) Increasing the market penetration of an existing product or service
  4. D) Extending product lines
  5. E) Strategic alliances

Answer:  E

Diff: 2      Page Ref: 475

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Application of Knowledge

 

 

 

 

6) Modcloth, Zappos and Sir Kensington's are examples of firms that are growing via ________ growth strategies.

  1. A) in-house
  2. B) external
  3. C) internal
  4. D) central
  5. E) derivative

Answer:  C

Diff: 2      Page Ref: 475

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Application of Knowledge

 

7) Which mechanism for firm growth involves the creation and sale of new products or services?

  1. A) Strategic alliances
  2. B) New product development
  3. C) Licensing
  4. D) Franchising
  5. E) Joint ventures

Answer:  B

Diff: 1      Page Ref: 475

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Application of Knowledge

 

 

8) Which of the following is an advantage of internal growth strategies?

  1. A) Need to develop new resources
  2. B) Get quality and pricing right
  3. C) Investment in a failed internal effort can be difficult to recoup
  4. D) Provides maximum control
  5. E) Adds to industry capacity

Answer:  D

Diff: 2      Page Ref: 476

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Application of Knowledge

9) Which of the following statements is not true regarding new product development?

  1. A) New product development involves designing, producing, and selling new products as a means of increasing firm revenues and profits.
  2. B) When new product development is properly executed, there is tremendous upside potential.
  3. C) The key to successful new product development strategy is to develop products that aren't simply "me-too" products.
  4. D) In general, developing new products is a low-risk strategy.
  5. E) In many fast-paced industries, new product development is a competitive necessity.

Answer:  D

Diff: 2      Page Ref: 477

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Reflective Thinking

 

10) The Savvy Entrepreneurial Firm feature in Chapter 14 focuses on SwitchFlops, a company that produces sandals with interchangeable straps. The primary takeaway from the feature is that savvy growth-minded startups ________.

  1. A) utilize both internal and external growth strategies
  2. B) emphasize internal rather than external growth strategies
  3. C) emphasize international growth strategies from their inception
  4. D) configure their products and services in ways that have built-in growth potential
  5. E) compete on the basis of quality rather than price

Answer:  D

Diff: 2      Page Ref: 477

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Reflective Thinking

 

 

11) Which of the following was not identified in the textbook as a key to effective new product development?

  1. A) Develop products that add value.
  2. B) Get quality and pricing right.
  3. C) Find a need and fill it.
  4. D) Conduct ongoing feasibility analysis.
  5. E) Focus on broad target markets.

Answer:  E

Diff: 2      Page Ref: 478

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Reflective Thinking

 

12) Which of the following was not identified in Chapter 14 as one of the top five reasons new products fail?

  1. A) The potential market was overestimated.
  2. B) Customers saw the product as too expensive.
  3. C) Lack of passion for the product
  4. D) The product was no different than the competition's.
  5. E) The costs of developing the product line were too high.

Answer:  C

Diff: 3      Page Ref: 478

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Application of Knowledge

13) External growth strategies involve efforts taken within the firm itself, such as new product development, other product-related strategies, and international expansion.

Answer:  FALSE

Diff: 1      Page Ref: 473

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Application of Knowledge

 

14) Internally generated growth is often called organic growth because it does not rely on outside intervention.

Answer:  TRUE

Diff: 2      Page Ref: 475

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Reflective Thinking

 

15) In many fast-paced industries, new product development is a competitive necessity.

Answer:  TRUE

Diff: 2      Page Ref: 475

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Reflective Thinking

 

 

16) An advantage of internal growth is that it is a rapid form of growth.

Answer:  FALSE

Diff: 2      Page Ref: 476

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Reflective Thinking

 

17) New product development is a low-risk growth strategy.

Answer:  FALSE

Diff: 2      Page Ref: 477

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Reflective Thinking

 

18) Explain the difference between internal and external growth strategies. Provide examples of each.

Answer:  Internal growth strategies rely on efforts generated within the firm itself, such as new product development, other product-related strategies, and international expansion. External growth strategies rely on establishing relationships with third parties, such as mergers, acquisitions, strategic alliances, joint ventures, licensing, and franchising.

Diff: 1      Page Ref: 475

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Reflective Thinking

 

19) Describe the internal growth strategy of new product development. Why is it a competitive necessity in some industries that entrepreneurial firms focus on this form of growth?

Answer:  New product development involves the creation and sale of new products (or services) as a means of increasing firm revenues. In many fast-paced industries, new product development is a competitive necessity. For example, the average product life cycle in the computer software industry can be measured in months. Because of this, to remain competitive, software companies must always have new products in their pipelines.

Diff: 2      Page Ref: 475

LO:  14.1: Identify and discuss the core internal growth strategy for entrepreneurial firms.

AACSB:  Reflective Thinking

20) If a business enhances the quality of a product, makes it more convenient to use, improves its durability, or makes it more up-to-date, any one of those initiatives fall under the category of ________.

  1. A) increasing the market penetration of an existing product or service
  2. B) extending product lines
  3. C) geographic expansion
  4. D) licensing
  5. E) improving an existing product or service

Answer:  E

Diff: 2      Page Ref: 479

LO:  14.2: Describe additional internal product-growth strategies entrepreneurial firms can use.

AACSB:  Application of Knowledge

 

 

21) A ________ strategy seeks to increase the sales of a product or service through greater marketing efforts or through increased production capacity and efficiency.

  1. A) product line extension
  2. B) product line sharpening
  3. C) product line widening
  4. D) market penetration
  5. E) market expansion

Answer:  D

Diff: 2      Page Ref: 479

LO:  14.2: Describe additional internal product-growth strategies entrepreneurial firms can use.

AACSB:  Analytical Thinking

 

22) Pam Ryan owns a store that sells running shoes and related products. Pam is currently trying to increase sales through endorsements by famous runners and former Olympic athletes. Pam is pursuing a(n) ________ strategy.

  1. A) strategic alliance
  2. B) licensing
  3. C) market penetration
  4. D) geographic expansion
  5. E) improving an existing product or service

Answer:  C

Diff: 2      Page Ref: 479

LO:  14.2: Describe additional internal product-growth strategies entrepreneurial firms can use.

AACSB:  Analytical Thinking

 

23) Work that is done for a company by people other than the company's full-time employees is referred to as ________.

  1. A) insourcing
  2. B) farming-out
  3. C) personnel extension
  4. D) outsourcing
  5. E) capacity enhancement

Answer:  D

Diff: 1      Page Ref: 480

LO:  14.2: Describe additional internal product-growth strategies entrepreneurial firms can use.

AACSB:  Analytical Thinking

 

24) A(n) ________ strategy involves making additional versions of a product so that it will appeal to different clientele.

  1. A) market penetration
  2. B) geographic expansion
  3. C) improving an existing product or service
  4. D) strategic alliance
  5. E) product line extension

Answer:  E

Diff: 2      Page Ref: 480

LO:  14.2: Describe additional internal product-growth strategies entrepreneurial firms can use.

AACSB:  Application of Knowledge

 

25) Chris Smith owns a store that sells all-terrain vehicles (ATVs). In the past, Chris just sold one version of each of the ATVs he sold in his showroom, but to increase sales, Chris now sells a low-end, a medium-priced, and a high-end version of each of the ATVs he sells. Chris's new strategy is called a(n) ________ strategy.

  1. A) improving an existing product or service
  2. B) market penetration
  3. C) product line extension
  4. D) geographic expansion
  5. E) joint venture

Answer:  C

Diff: 2      Page Ref: 480

LO:  14.2: Describe additional internal product-growth strategies entrepreneurial firms can use.

AACSB:  Analytical Thinking

 

26) Entrepreneurial businesses that grow by expanding from their original location to additional geographic sites are pursuing a ________ strategy.

  1. A) common expansion
  2. B) market penetration
  3. C) universal networking
  4. D) geographic expansion
  5. E) product line extension

Answer:  D

Diff: 2      Page Ref: 480

LO:  14.2: Describe additional internal product-growth strategies entrepreneurial firms can use.

AACSB:  Analytical Thinking

 

 

27) Shelly Watters owns a chain of fashion boutiques that started in Washington, DC and has expanded into Maryland, Virginia, and West Virginia. Shelly is growing her company via a strategy of ________.

  1. A) geographic expansion
  2. B) market penetration
  3. C) product line extension
  4. D) outsourcing
  5. E) licensing

Answer:  A

Diff: 2      Page Ref: 480

LO:  14.2: Describe additional internal product-growth strategies entrepreneurial firms can use.

AACSB:  Analytical Thinking

28) A market penetration strategy involves actions taken to increase the sales of a product or service through greater marketing efforts or through increased product capacity and efficiency.

Answer:  TRUE

Diff: 2      Page Ref: 479

LO:  14.2: Describe additional internal product-growth strategies entrepreneurial firms can use.

AACSB:  Application of Knowledge

 

29) A product line extension strategy involves making additional versions of a product so that it will appeal to a different clientele or making related products to sell to the same clientele.

Answer:  TRUE

Diff: 2      Page Ref: 480

LO:  14.2: Describe additional internal product-growth strategies entrepreneurial firms can use.

AACSB:  Reflective Thinking

 

30) Geographic expansion is most common in manufacturing settings.

Answer:  FALSE

Diff: 2      Page Ref: 480

LO:  14.2: Describe additional internal product-growth strategies entrepreneurial firms can use.

AACSB:  Reflective Thinking

 

 

31) Describe what a product line extension strategy is. What are the advantages of this strategy? Describe a company you are familiar with that utilizes a product line extension growth strategy.

Answer:  A product line extension strategy involves making additional versions of a product so that it will appeal to different clientele or making related products to sell to the same clientele. For example, a company may take a low-end product, make another version of it that is a little better, and then make another version of it that represents the top of the line. The advantage of a product extension strategy is that it allows a firm to take one product and extend it into several products without incurring significant additional development expense. In regard to making related products to sell to the same clientele, many firms start by offering one product or service and then expand into related areas. Many companies utilize product extension strategies. Starbucks, for example, now sells bottled Frappuccino Coffee, which is an extension of its more traditional hot coffees and related drinks sold in its restaurants.

Diff: 2      Page Ref: 480

LO:  14.2: Describe additional internal product-growth strategies entrepreneurial firms can use.

AACSB:  Reflective Thinking

 

32) According to a survey of rapid growth firms conducted by the Small Business & Entrepreneurship Council and the Financial Services Roundtable, ________ percent of the firms in the survey said that expanding into overseas markets factored into their business plans over the next five years.

  1. A) 9
  2. B) 21
  3. C) 40
  4. D) 53
  5. E) 66

Answer:  B

Diff: 3      Page Ref: 481

LO:  14.3: Examine international expansion as a growth strategy.

AACSB:  Application of Knowledge

33) International new ventures are ________.

  1. A) businesses that have employees located in two or more countries
  2. B) businesses that sell products in two or more countries
  3. C) businesses that, from inception, seek to derive significant competitive advantage by using their resources to sell products or services in multiple countries
  4. D) businesses that are headquartered in a foreign country and export their products to the United States
  5. E) new ventures that export at least one-third of their products to foreign countries

Answer:  C

Diff: 2      Page Ref: 481

LO:  14.3: Examine international expansion as a growth strategy.

AACSB:  Analytical Thinking

 

 

34) The What Went Wrong feature in Chapter 14 focuses on the failure of Crumbs Bake Shop, a specialty-restaurant chain that sold gourmet cupcakes. According to the feature, Crumbs failed due to ________.

  1. A) lack of funding to facilitate expansion, high real estate costs, management turnover, poor operating margins
  2. B) no pivot or change in strategy, lack of international expansion, trademark dispute with a competitor, failure to franchise
  3. C) increasingly crowded market, consumers started losing interest in cupcakes, high real estate costs, and no pivot or change in strategy
  4. D) lack of funding to facilitate expansion, management turnover, increasingly crowded market, and high fixed costs
  5. E) high operating costs, trademark dispute with a competitor, consumers started losing interest in cupcakes, and failure to franchise

Answer:  C

Diff: 3      Page Ref: 482

LO:  14.3: Examine international expansion as a growth strategy.

AACSB:  Analytical Thinking

 

35) Which of the following is the primary advantage of exporting as a foreign market entry strategy?

  1. A) Provides a firm total control over its foreign operations
  2. B) Ability to generate revenue
  3. C) Exporting is a relatively inexpensive way for a firm to become involved in foreign markets.
  4. D) The exporting company's customers put up most of the capital needed to establish the export operation.
  5. E) Exporting involves very little effort on the part of a firm.

Answer:  C

Diff: 2      Page Ref: 484

LO:  14.3: Examine international expansion as a growth strategy.

AACSB:  Reflective Thinking

36) Which of the following is the primary disadvantage of licensing as a foreign market entry strategy?

  1. A) A firm in effect "teaches" a foreign company how to produce its proprietary products.
  2. B) High transportation costs
  3. C) It is usually a one-time activity.
  4. D) A firm loses partial control of its business operations.
  5. E) Quality control

Answer:  A

Diff: 2      Page Ref: 484

LO:  14.3: Examine international expansion as a growth strategy.

AACSB:  Application of Knowledge

 

 

37) Which of the following is the primary advantage of a wholly owned subsidiary as a foreign market entry strategy?

  1. A) Provides a firm total control over its operations
  2. B) Easier to raise capital to implement than other foreign market entry strategies
  3. C) Gaining an appreciation of local customs and market preferences
  4. D) Low transportation costs
  5. E) The ability to give employees foreign market experience

Answer:  A

Diff: 2      Page Ref: 484

LO:  14.3: Examine international expansion as a growth strategy.

AACSB:  Analytical Thinking

 

38) The majority of entrepreneurial firms first enter foreign markets as exporters.

Answer:  TRUE

Diff: 2      Page Ref: 484

LO:  14.3: Examine international expansion as a growth strategy.

AACSB:  Application of Knowledge

 

39) ________ growth strategies rely on establishing relationships with third parties, such as mergers, acquisitions, strategic alliances, joint ventures, licensing, and franchising.

  1. A) Internal
  2. B) Domestic
  3. C) Outside
  4. D) External
  5. E) Peripheral

Answer:  D

Diff: 1      Page Ref: 485

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Application of Knowledge

40) Brian Ramsey owns a firm that develops and sells smartphone accessories. He is currently trying to grow his firm through strategic alliances and joint ventures. Brian is pursuing a(n) ________ growth strategy.

  1. A) domestic
  2. B) external
  3. C) subsidiary
  4. D) internal
  5. E) secondary

Answer:  B

Diff: 1      Page Ref: 485

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Analytical Thinking

 

 

41) Which of the following is an example of an external growth strategy?

  1. A) New product development
  2. B) Mergers and acquisitions
  3. C) Market penetration
  4. D) Product line extension
  5. E) Geographic expansion

Answer:  B

Diff: 2      Page Ref: 485

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Application of Knowledge

 

42) Rachel Watts owns a chain of office supply stores. Over the past three years, Rachel has significantly increased her sales through the outright purchase of additional office supply stores. Rachel is pursuing a(n) ________ strategy.

  1. A) acquisition
  2. B) merger
  3. C) strategic alliance
  4. D) joint venture
  5. E) licensing

Answer:  A

Diff: 2      Page Ref: 485

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Analytical Thinking

 

43) A(n) ________ is the pooling of interests to combine two or more firms into one. A(n) ________ is the outright purchase of one firm by another.

  1. A) acquisition; merger
  2. B) merger; acquisition
  3. C) licensing agreement; acquisition
  4. D) joint venture; strategic alliance
  5. E) strategic alliance; joint venture

Answer:  B

Diff: 1      Page Ref: 485

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Analytical Thinking

44) In an acquisition, the surviving firm is called the ________, and the firm that is acquired is called the ________.

  1. A) target; acquirer
  2. B) goal; objective
  3. C) objective; aggressor
  4. D) acquirer; target
  5. E) aggressor; objective

Answer:  D

Diff: 2      Page Ref: 485

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Analytical Thinking

 

45) Two years ago, Cameron Jones and Mary Scott each owned a small chain of smoothie restaurants in New York City. Just recently, they decided to pool their interests and combine their individual chains of restaurants into one chain. What Cameron and Mary did with their firms is called a(n) ________.

  1. A) licensing agreement
  2. B) strategic alliance
  3. C) acquisition
  4. D) joint venture
  5. E) merger

Answer:  E

Diff: 2      Page Ref: 485

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

46) Which of the following is a disadvantage of growth by means of external growth strategies?

  1. A) Diversification of business risk
  2. B) Economies of scale
  3. C) Getting access to proprietary products or services
  4. D) Reducing competition
  5. E) Loss of organizational flexibility

Answer:  E

Diff: 3      Page Ref: 486

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Application of Knowledge

 

47) Which of the following is an advantage of growth by means of external growth strategies?

  1. A) Gaining access to new products and markets
  2. B) Increased business complexity
  3. C) Clash of corporate cultures
  4. D) Antitrust implications
  5. E) Loss of organizational flexibility

Answer:  A

Diff: 3      Page Ref: 486

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Application of Knowledge

 

48) The two primary steps involved in finding an appropriate acquisition candidate are (1) Make a "short list" of appropriate acquisition candidates and (2) ________.

  1. A) carefully screen each candidate to determine its suitability for acquisition
  2. B) interview the CEO of each candidate to determine his/her openness to an acquisition
  3. C) determine if acquiring each candidate is financially feasible
  4. D) meet with each candidate's top management team to discern if they are compatible with your top management team
  5. E) hire a consulting firm to determine the best acquisition candidate

Answer:  A

Diff: 3      Page Ref: 487

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

49) ________ is the granting of permission by one company to another company to use a specific form of its intellectual property under clearly defined conditions.

  1. A) Verifying
  2. B) Confirming
  3. C) Endorsing
  4. D) Licensing
  5. E) Certifying

Answer:  D

Diff: 1      Page Ref: 489

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Application of Knowledge

 

50) The ________ is the company that owns the intellectual property. The ________ is the company purchasing the right to use it.

  1. A) endorsee; endorser
  2. B) licensor; licensee
  3. C) licensor; endorsee
  4. D) endorser; endorsee
  5. E) licensee; licensor

Answer:  B

Diff: 2      Page Ref: 489

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

 

51) ________ licensing is the licensing of proprietary technology that the licensor typically controls by virtue of a utility patent.

  1. A) Skill
  2. B) Intellectual property
  3. C) Utility
  4. D) Technology
  5. E) Expertise

Answer:  D

Diff: 1      Page Ref: 490

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

52) Qualcomm, a high-tech company headquartered in San Diego, owns the rights to several of the key components that permit cell phones to work. Instead of selling cell phones itself, Qualcomm grants permission to many companies to use specific forms of its intellectual property in exchange for monetary compensation. Qualcomm in engaging in an external growth strategy referred to as ________.

  1. A) licensing
  2. B) strategic alliances
  3. C) acquisitions
  4. D) new product development
  5. E) joint ventures

Answer:  A

Diff: 2      Page Ref: 490

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Analytical Thinking

 

53) ________ licensing is the licensing of a recognized trademark or brand that the licensor typically controls through a registered trademark or copyright.

  1. A) Goods and character
  2. B) Products and trademark
  3. C) Products and brand
  4. D) Merchandise and character
  5. E) Products and services

Answer:  D

Diff: 2      Page Ref: 490

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Application of Knowledge

 

 

54) Merchandise and character licensing is the licensing of a recognized trademark or brand that the licensor typically controls through a registered ________.

  1. A) trade secret or copyright
  2. B) patent or copyright
  3. C) trademark or patent
  4. D) patent or trade secret
  5. E) trademark or copyright

Answer:  E

Diff: 2      Page Ref: 490

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

55) Samantha Jones owns a chain of ice cream stores in New England. To draw attention to her stores, she adopted a very colorful and distinctive logo several years ago, which depicts a funny-looking cow churning ice cream. Recently, a dairy company asked Samantha if it could use a characterization of her funny-looking cow on a line of yogurt it is coming out with, and offered to pay Samantha's company 3 cents for every carton of yogurt it sells that has the cow's image on the carton. If Samantha accepts this proposal, she will need to enter into a(n) ________ agreement with the dairy.

  1. A) licensing
  2. B) joint venture
  3. C) strategic alliance
  4. D) new product development
  5. E) exporting

Answer:  A

Diff: 2      Page Ref: 490

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Analytical Thinking

 

56) According to the textbook, the key to effective merchandise and character licensing is ________.

  1. A) get licensing income monthly rather than yearly
  2. B) resist the temptation to license a trademark too widely
  3. C) licensing a trademark very widely
  4. D) restrict licensing agreements to one year
  5. E) restrict licensing to product categories that have no relevance and appeal to a firm's core customers

Answer:  B

Diff: 3      Page Ref: 490

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

 

57) A ________ is a partnership between two or more firms that is developed to achieve a specific goal and has no joint ownership involved.

  1. A) joint alliance
  2. B) joint venture
  3. C) licensing agreement
  4. D) merger
  5. E) strategic alliance

Answer:  E

Diff: 1      Page Ref: 491

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

58) Which of the following was identified in the textbook as an advantage of participating in strategic alliances and joint ventures?

  1. A) Management complexities
  2. B) Loss of organizational flexibility
  3. C) Partners' cultures may clash.
  4. D) Risk becoming dependent on a partner
  5. E) Learning

Answer:  E

Diff: 2      Page Ref: 491

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

59) Which of the following was identified in the textbook as a disadvantage of participating in strategic alliances and joint ventures?

  1. A) Risk and cost sharing
  2. B) Economies of scale
  3. C) Partial loss of decision autonomy
  4. D) Gain access to a foreign market
  5. E) Neutralizing or blocking competitors

Answer:  C

Diff: 2      Page Ref: 491

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

60) In the context of strategic alliances, ________ alliances feature cooperation in research and development, engineering, and manufacturing.

  1. A) administrative
  2. B) directorial
  3. C) marketing
  4. D) organizational
  5. E) technological

Answer:  E

Diff: 2      Page Ref: 491

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

61) In the context of strategic alliances, ________ alliances typically match a company with a distribution system with a company that has a product to sell to increase sales of a product or service.

  1. A) promotion
  2. B) marketing
  3. C) organizational
  4. D) directional
  5. E) technological

Answer:  B

Diff: 2      Page Ref: 491

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

62) The Partnering for Success feature in Chapter 14 is titled "Three Steps to Alliance Success." The three steps to alliance success identified in the feature are ________.

  1. A) drafting a licensing agreement, setting up a governance structure, and making it work
  2. B) selecting a partner, cutting the deal, and making it work
  3. C) interviewing potential partners, cutting the deal, and supervising the implementation of the agreement
  4. D) drafting a licensing agreement, cutting the deal, and setting up a governance structure
  5. E) selecting an alliance "manager," setting up a governance structure, and making it work

Answer:  B

Diff: 3      Page Ref: 492

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

63) External growth strategies rely on establishing relationships with third parties, such as mergers, acquisitions, strategic alliances, joint ventures, licensing, and franchising.

Answer:  TRUE

Diff: 1      Page Ref: 485

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

64) An acquisition is the pooling of interests to combine two or more firms into one. A merger is the outright purchase of one firm by another.

Answer:  FALSE

Diff: 2      Page Ref: 485

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Analytical Thinking

 

65) In an acquisition, the surviving firm is called the acquirer, and the firm that is acquired is called the target.

Answer:  TRUE

Diff: 2      Page Ref: 486

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

66) In regard to acquisitions, many firms have found that the process of assimilating another company into their current operations is relatively easy and is not disruptive to the current operations of their firm.

Answer:  FALSE

Diff: 3      Page Ref: 486

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

67) Licensing is the granting of permission by one company to another company to use a specific form of its intellectual property under clearly-defined conditions.

Answer:  TRUE

Diff: 2      Page Ref: 489

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

68) Technology licensing is the licensing of proprietary technology that the licensor typically controls by virtue of a utility patent.

Answer:  TRUE

Diff: 2      Page Ref: 490

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

69) Loss of proprietary information is a disadvantage of participating in strategic alliances and joint ventures.

Answer:  TRUE

Diff: 2      Page Ref: 491

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

70) A joint venture is a partnership between two or more firms that is developed to achieve a specific goal and has no joint ownership involved.

Answer:  FALSE

Diff: 2      Page Ref: 491

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Analytical Thinking

 

71) In a link joint venture, the partners collaborate at a single point in the value chain to gain economies of scale in production or distribution.

Answer:  FALSE

Diff: 2      Page Ref: 493

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Analytical Thinking

 

 

72) In a scale joint venture, the position of the parties is not symmetrical, and the objectives of the partners may diverge.

Answer:  FALSE

Diff: 2      Page Ref: 493

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Analytical Thinking

 

73) A spin-out occurs when a large company divests itself of one of its smaller divisions and the division becomes an independent company.

Answer:  TRUE

Diff: 3      Page Ref: 494

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

 

74) Describe what licensing is. What type of intellectual property can be licensed? Identify the two types of licensing pursued by entrepreneurial firms.

Answer:  Licensing is the granting of permission by one company to another company to use a specific form of its intellectual property under clearly defined conditions. Virtually any intellectual property a company owns that is protected by a patent, trademark or copyright can be licensed to a third party. There are two principle types of licensing. Technology licensing is the licensing of proprietary technology that the licensor typically controls by virtue of a utility patent. Merchandise and character licensing is the licensing of a recognized trademark or brand that the licensor typically controls through a registered trademark or copyright.

Diff: 2      Page Ref: 489

LO:  14.4: Discuss different types of external growth strategies.

AACSB:  Reflective Thinking

75) Describe what a joint venture is. Identify the two types of joint ventures.

Answer:  A joint venture is an entity created when two or more firms pool a portion of their resources to create a separate, jointly owned organization. The two types of joint ventures are scale joint ventures and link joint ventures. In a scale joint venture, the partners collaborate at a single point in the value chain to gain economies of scale in production and distribution. In a link joint venture, the position of the parties is not symmetrical, and the objectives of the parties may diverge. For example, many of the joint ventures between American and Canadian food companies provide the American partner with access to Canadian markets and distribution channels and the Canadian partner with the opportunity to add to its product line.

Diff: 3      Page Ref: 493

LO:  14.4: Discuss different types of external growth strategies.

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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