Quiz 4

 Which of the following best describes a key reason for starting your own business?

• a. Running one's own business provides a level of challenge unmatched by many other endeavors.

• b. Being one's own boss provides security and is statistically proven in a recent study conducted at Harvard.

• c. While starting up one own business actually crowds the schedule a little bit more, this lack of flexibility up front is worth it in the end.

• d. Most small businesses are taken public in the first five years, netting entrepreneurial founders huge profits.

 Chelsea currently works as a manager at a major corporation but has been thinking about quitting her job and starting her own business.  Which of the following reasons would most likely explain Chelsea's interest in making this major career change.

• a. She wants a job with fewer responsibilities and smaller span of duties.

• b. She wants access to more benefits such as health insurance and a steadier income.

• c. She doesn't like the risk associated with working in the corporate environment.

• d. She want to have more independence and flexibility than her corporate position allows.

 _____________________ are people who risk their time, money, and other resources to start and manage a business.

• a. Stockholders.

• b. Entrepreneurs.

• c. Stakeholders.

• d. Venture capitalists.

The primary reason many people become entrepreneurs is to:

• a. obtain a stable income.

• b. avoid risk uncertainty.

• c. make more money.

• d. revolutionize business model.

 Technological developments over the past two decades, such as the rise of the Internet and social media have:

• a. reduced the role of entrepreneurship in the national economy.

• b. given small business owners more flexibility in business management.

• c. made it harder for small business to compete against large business.

• d. reduced the independence small businesses have in managing a business.

 When entrepreneurs fail, they tend to:

• a. frequently label themselves as losers.

• b. become even more averse to risk.

• c. view failure as a chance to learn.

• d. cut their losses and get regular jobs.

Entrepreneurs must understand that no conventional lender, whether private or public, will:

• a. loan all of the startup's funding.

• b. work with large corporations.

• c. lend any money to start-ups.

• d. charge low interest for start-ups.

 Small business start-ups are likely to find that getting commercial loans is:

• a. hard to do because commercial lenders are reluctant to loan to firms that don't have an established record of successful performance.

• b. one of the easiest and most flexible sources of financing because local bankers are usually eager to establish relationships with new companies.

• c. relatively difficult because the risks involved are great because they entail much higher financing costs when compared to other sources.

• d. the best way to obtain 100 percent of the financing they need, but only if they give the lender an ownership stake in the company.

Which of the follow bodies assists entrepreneurs by guaranteeing loans from local commercial lenders?

• a. Federal Reserve.

• b. Patent and Trademark Office.

• c. Small Business Administration.

• d. Department of the Treasury.

 __________________ are wealthy individuals who invest in startup companies with high growth potential in exchange for a share of ownership.

• a. Angel investors.

• b. Commercial lenders.

• c. Private lenders

• d. Alternative lenders.