PBMF Chapter 6 Review

Short-term financing is obtained for a period of less than

• 2 years

• 1 year

• 3 months

• 6 months

If you start a new business, you need information about:

• customers

• competitors

• government regulations

• all of these

Which element of a business plan discusses the entrepreneur's short- and long-term goals for the business?

• customer analysis

• financial plan

• description of the competition

• description of the business

Location is important to small retail businesses because

• customers generally do not want to travel long distances to find what they need.

• many potential customers will stay away if the business isn't easy to find.

• most retailers need good customer traffic to survive.

• all of the above

Small business owners

• usually get direct information from their customers about what they like and dislike.

• typically focus on products and services that meet the needs of a large group of customers.

• rely heavily on consumer research to gather information.

• have less frequent contact with their customers than large businesses.

According to the Small Business Administration, a small business is an independent business with fewer than ____ employees.

• 50

• 10

• 100

• 500

Scrub-a-Dub laundry detergent has been on the market for years. The manufacturer of Scrub-a-Dub recently added a new ingredient to give the detergent extra cleaning power. This is an example of an

• innovation

• opportunity cost

• improvement

• invention

Most of the money needed to start a new business come from

• the sale of stock.

• personal and business loans.

• the entrepreneur and his/her family and friends.

• credit given by businesses that sell products and services to the new business.

Entrepreneurs

• almost never own their first business while in their teens.

• must have a degree to be successful.

• must have very low tolerance for ambiguity.

• come from all age categories and educational back grounds.

In the US, women own close to this percentage of small businesses.

• 25%

• 75%

• 35%

• 50%