Free Printable Entrepreneurial Finance Big Quiz Year 2023

1.

Which one of the follow is a reason that entrepreneurs fail?

a)

No finance (money)

b)

Too many ideas

c)

Risk-management

d)

Because they love ice cream

2.

What is NOT one of the skills that an entrepreneur needs?

a)

time-management

b)

risk-management

c)

characteristics

d)

Communication

3.

What 2 actions are needed for someone to be called an "entrepreneur"?

a)

starting a business

b)

running a business

c)

being a manager

d)

selling goods

e)

travelling

4.

What word means "a project or business that needs bravery, creativity and ideas"?

a)

Risk-taking

b)

Collaboration

c)

Enterprise

d)

Innovation

5.

What is NOT one of the characteristics that a entrepreneur needs?

a)

risk-taking

b)

creativity

c)

finance (money)

d)

Independence

6.

What is NOT one of the reasons for an entrepreneur to fail?

a)

Poor financial management

b)

Poor location choice

c)

Bad economy

d)

Lack of finance (money)

e)

Unclear objectives

7.

What is one thing that an enterprise needs to be successful?

a)

new ideas

b)

a large office

c)

at least 1000 people

d)

ice cream

8.

What is one of the skills that an entrepreneur needs?

a)

Decision-making

b)

Poor location

c)

Ideas

d)

Independent

9.

What is one of the characteristics that a entrepreneur needs?

a)

self-motivation

b)

interpersonal

c)

finance (money)

d)

communication

10.

Which TWO sections have an aspect about risks?

a)

Failure

b)

Skills

c)

Characteristics

d)

Enterprise

11.

Is an Entrepreneur an employee that works for a small business?

a)

True

b)

False

12.

What is Entrepreneurship?

a)

Job shadowing for customers

b)

The process of working under a boss

c)

The process of starting, organizing, managing, and assuming the responsibility for a business

d)

Working the cash

13.

Describe Venture Capital

a)

Money that is taken from you and used for government use

b)

Loan from your personal bank

c)

Main office of a business

d)

Money provided by large investors to finance new products

14.

True or False:
Innovation is an invention or creation that is brand new

a)

True

b)

False

15.

Becoming an Entrepreneur starts with having ...

a)

Money

b)

An idea

c)

Name

d)

All of the above

16.

True or False:
Is it bad to expand your small business?

a)

True

b)

False

17.

What is financing...

a)

Providing funding for a person or enterprise

b)

A loan from a bank

c)

Saving Money

d)

Cashing out on a business

18.

Small businesses are responsible for most....

a)

Financing

b)

Getting good reviews

c)

Keeping customers coming back

d)

New Employment

19.

Over what percent of new jobs were created by businesses with fewer than 500 employees?

a)

20%

b)

60%

c)

45%

d)

30%

20.

An improvement is a(n)...

a)

idea

b)

Starting over on your product

c)

designed change that increases the usefulness of a product, service, or product

d)

None of The Above

21.

True or False:
Would a doctor with his/her on firm be an entrepreneur?

a)

True

b)

False

22.

True or False:
Could there be more than one owner of a business?

a)

True

b)

False

23.

New and small business produce a large volume of ______ and ______ for the economy.

a)

Knowledge and Training

b)

Managing and Organizing

c)

Products and Money

d)

Goods and Services

24.

The primary reasons that businesses started by entrepreneurs close are:

a)

Lack of adequate capital

b)

Low Sales

c)

Competitive Pressure

d)

All of the above

25.

The value of all of a company’s expected cash flows after a specified forecast period is called _______________.

a)

Equity value

b)

enterprise value

c)

terminal value

d)

free cash flow

26.

The equity value of a company, plus any debt, minus cash is called the _______________.

a)

equity value

b)

enterprise value

c)

terminal value

d)

free cash flow

27.

A model for determining the terminal value of a business that assumes a company exists forever and grows at a constant rate forever is called _______________.

a)

the Gordon Growth model

b)

the terminal valuation model

c)

the non-termination model

d)

business succession planning

28.

The discounted cash flow method of business valuation is a methodology that places a value on a business by determining, at a specified discount rate, the sum of the _______________ values of all of the business’s expected future cash flows.

a)

future

b)

present

c)

average

d)

weighted-average

29.

A/An _______________ business valuation is predicated on the idea that a business’s true value lies in its ability to produce net income and positive cash flow in the future.

a)

asset-based

b)

earnings-based

c)

equity-based

d)

market-based

30.

A _______________ business valuation attempts to establish the value of a business by comparing the business to be put on the market to similar businesses that have recently been sold.

a)

asset-based

b)

earnings-based

c)

equity-based

d)

market-based

31.

Which of the following statements about business valuation is false?

a)

The discounted cash flow method of business valuation determines a value for a business based upon the expected future cash flows of the business.

b)

The discount rates used for business valuation are usually higher than the discount rates used for capital budgeting.

c)

A business valuation may become necessary because of insurance requirements, because one of the owners wants to exit the business, or because of the tax planning or tax reporting needs of either the business or one of its owners.

d)

An entrepreneur should place a value on his business based on how much time and money the entrepreneur has invested in the business.

32.

The equity value of your LLC is $4,500,000. If an angel investor offers to invest $450,000 in your business, what percentage of the equity of your business would you likely give him?

a)

1%

b)

10%

c)

0.1%

d)

45%

33.

The equity value of your LLC is $4,500,000 and you have 100,000 shares, what is the value of one share of stock?

a)

$45.00

b)

$450.00

c)

$4.50

d)

$0.02

34.

An angel investor is willing to invest $100K in your company for 10% of the equity and wants to triple her money in five years. How much must the company be worth in three years to get her the requested return?

a)

$300K

b)

$30K

c)

$3M

d)

$100M

35.

1/1

Your company currently has 1,000 shares of stock and plans to sell an angel investor shares that will account for a 10% stake in the business. Approximately, how many shares will you need to sell him?

a)

1 share

b)

10 shares

c)

110 shares

d)

1,100 shares

36.

Start-up businesses usually go through a period of zero revenue: the start-up phase of the business.

a)

True

b)

False

37.

Entrepreneurial working capital management involves asking for better terms than those offered by any vendor, creditor, lender or customer in order to maximize your business’ profitability and cash flow.

a)

True

b)

False

38.

Which of the following is not a balance sheet item working capital management typically focuses on?

a)

cash

b)

accounts receivable

c)

inventory

d)

fixed assets

39.

Sales paid for with a credit card like a Visa or MasterCard should be included in a company's accounts receivable.

a)

True

b)

False

40.

The two primary goals of inventory management are to:

(1pts)

a)

keep inventory at a minimum level to maximize available cash, but keep enough inventory on hand to always satisfy production or customer demand

b)

keep inventory at a maximum level and keep enough inventory on hand to always satisfy production or customer demand

c)

keep inventory at a minimum level to maximize available cash, but keep enough inventory on hand to satisfy production or customer demand most of the time

d)

keep inventory at a maximum level and keep enough inventory on hand to satisfy production or customer demand most of the time

41.

A business can be profitable and still go out of business because it runs out of cash.

a)

True

b)

False

42.

Which of the following is not true about accounts payable?

a)

Accounts payable are amounts a business owes to its customers.

b)

Usually, accounts payable relate to a business’s recurring purchases.

c)

For many businesses, the largest portion of accounts payable typically relates to purchases of inventory.

d)

The usual method of managing accounts payable is to pay out as little cash as possible in order to properly settle the obligations.

43.

An aging of accounts receivable is a schedule that:

a)

lists customers with unpaid balances in alphabetical order

b)

categorizes unpaid customer invoices based on the number of days they have been outstanding

c)

categorizes unpaid customer invoices based on how quickly they have been paid

d)

lists customers with unpaid balances in the order of least likely to most likely to pay

44.

Work-in-process inventory is made up of items that are kept on hand not to be sold, but instead to help the firm maintain consistent operations. Replacement parts for key manufacturing equipment is a good example of work-in-process inventory.

a)

True

b)

False

45.

When a company can determine, based on its history, that a certain percentage of its accounts receivable are typically not collectible—or when a company has identified specific individual accounts receivable that are likely not collectible—the company should establish a reserve for bad debts.

a)

True

b)

False

46.

1/1

Ideally, a good business succession plan is in writing and transparent to all of a business’s stakeholders so that, when the time comes to institute the plan, the process can move forward with those most affected by the plan both aware of and in agreement with the plan.

a)

True

b)

False

47.

A _______________ is a contract between a business’s owners that indicates the terms that will surround the purchase of an exiting owner’s interest in the business.

a)

non-compete agreement

b)

buy-sell agreement

c)

liquidation

d)

dissolution

48.

Legally terminating the existence of a business is called a ______________.

a)

non-compete agreement

b)

buy-sell agreement

c)

liquidation

d)

dissolution

49.

In order for a business owner to harvest cash via capital gain, the owner must sell 100% of his ownership of a business.

a)

True

b)

False

50.

An estimate of the value of a business most business brokers, M&A advisors, and investment banking firms consider to be the best estimate of the value of a business to be put on the

market for sale is called _______________.

a)

equity value

b)

enterprise value

c)

terminal value

d)

free cash flow

51.

_______________ is the process of a company willingly subjecting itself to a form of investigation by a potential buyer of the business or a potential new partner in the business.

a)

Due diligence

b)

The Gordon growth model

c)

Leveraged recapitalization

d)

A leveraged buyout

52.

A usually bulleted list of the significant conditions and circumstances associated with a proposed business arrangement is called a _______________.

a)

retainer

b)

term sheet

c)

selling memo

d)

due diligence list

53.

Which of the following statements is false with regard to selling a business?

a)

An asset-only purchase is often preferable for a buyer.

b)

In order to get the best price for your business, beyond sharing your financial statements, you’ll want to be able to produce two or three years of tax returns that are accurate, tie into your business’s financial statements, and demonstrate your business’s profitability.

c)

One type of professional help that’s almost always required when selling a business is the guidance of a good attorney.

d)

Selling a business, though generally a large and complex transaction, rarely brings with it significant emotional impact for a business owner.

54.

Attempting to sell a business should only occur after properly positioning the business for sale.

a)

True

b)

False

55.

Angel investors prefer to hold off on providing advice until after they have invested so they can focus on maximizing their returns.

a)

True

b)

False

56.

VCs are looking for opportunities to

a)

deploy millions of dollars

b)

get multiple times return on their investment

c)

take advantage of a large market

d)

all of the above

57.

Large venture funds like to make a lot of small ($100K) investments to test the market.

a)

True

b)

False

58.

When looking for a VC to make an investment, it is best to find a partner with ten or more current investments.

a)

True

b)

False

59.

When a VC decides to make an investment in a company, they will indicate it through what is called:

a)

an offer sheet

b)

a term sheet

c)

a due diligence request

d)

a valuation offer

60.

When evaluating an opportunity, investors look for

a)

founders with prior ventures

b)

founders with industry experience

c)

founders who have experienced stressful situations

d)

all of the above

61.

VCs look for opportunities that:

a)

a large target market

b)

significant growth potential

c)

limited competition

d)

all of the above

62.

VCs look for opportunities that:

a)

have products with proprietary features

b)

have intellectual property protection

c)

exclusive licenses and marketing relationships

d)

all of the above

63.

The value of all of a company’s expected cash flows after a specified forecast period is called _______________.

a)

Equity value

b)

enterprise value

c)

terminal value

d)

free cash flow

64.

The equity value of a company, plus any debt, minus cash is called the _______________.

a)

equity value

b)

enterprise value

c)

terminal value

d)

free cash flow

65.

A model for determining the terminal value of a business that assumes a company exists forever and grows at a constant rate forever is called _______________.

a)

the Gordon Growth model

b)

the terminal valuation model

c)

the non-termination model

d)

business succession planning

66.

The discounted cash flow method of business valuation is a methodology that places a value on a business by determining, at a specified discount rate, the sum of the _______________ values of all of the business’s expected future cash flows.

a)

future

b)

present

c)

average

d)

weighted-average

67.

A/An _______________ business valuation is predicated on the idea that a business’s true value lies in its ability to produce net income and positive cash flow in the future.

a)

asset-based

b)

earnings-based

c)

equity-based

d)

market-based

68.

A _______________ business valuation attempts to establish the value of a business by comparing the business to be put on the market to similar businesses that have recently been sold.

a)

asset-based

b)

earnings-based

c)

equity-based

d)

market-based

69.

Which of the following statements about business valuation is false?

a)

The discounted cash flow method of business valuation determines a value for a business based upon the expected future cash flows of the business.

b)

The discount rates used for business valuation are usually higher than the discount rates used for capital budgeting.

c)

A business valuation may become necessary because of insurance requirements, because one of the owners wants to exit the business, or because of the tax planning or tax reporting needs of either the business or one of its owners.

d)

An entrepreneur should place a value on his business based on how much time and money the entrepreneur has invested in the business.

70.

The equity value of your LLC is $4,500,000. If an angel investor offers to invest $450,000 in your business, what percentage of the equity of your business would you likely give him?

a)

1%

b)

10%

c)

0.1%

d)

45%

71.

The equity value of your LLC is $4,500,000 and you have 100,000 shares, what is the value of one share of stock?

a)

$45.00

b)

$450.00

c)

$4.50

d)

$0.02

72.

1/1

Your company currently has 1,000 shares of stock and plans to sell an angel investor shares that will account for a 10% stake in the business. Approximately, how many shares will you need to sell him?

a)

1 share

b)

10 shares

c)

110 shares

d)

1,100 shares

73.

Start-up businesses usually go through a period of zero revenue: the start-up phase of the business.

a)

True

b)

False

74.

Entrepreneurial working capital management involves asking for better terms than those offered by any vendor, creditor, lender or customer in order to maximize your business’ profitability and cash flow.

a)

True

b)

False

75.

Which of the following is not a balance sheet item working capital management typically focuses on?

a)

cash

b)

accounts receivable

c)

inventory

d)

fixed assets

76.

Sales paid for with a credit card like a Visa or MasterCard should be included in a company's accounts receivable.

a)

True

b)

False

77.

The two primary goals of inventory management are to:

(1pts)

a)

keep inventory at a minimum level to maximize available cash, but keep enough inventory on hand to always satisfy production or customer demand

b)

keep inventory at a maximum level and keep enough inventory on hand to always satisfy production or customer demand

c)

keep inventory at a minimum level to maximize available cash, but keep enough inventory on hand to satisfy production or customer demand most of the time

d)

keep inventory at a maximum level and keep enough inventory on hand to satisfy production or customer demand most of the time

78.

A business can be profitable and still go out of business because it runs out of cash.

a)

True

b)

False

79.

Which of the following is not true about accounts payable?

a)

Accounts payable are amounts a business owes to its customers.

b)

Usually, accounts payable relate to a business’s recurring purchases.

c)

For many businesses, the largest portion of accounts payable typically relates to purchases of inventory.

d)

The usual method of managing accounts payable is to pay out as little cash as possible in order to properly settle the obligations.

80.

An aging of accounts receivable is a schedule that:

a)

lists customers with unpaid balances in alphabetical order

b)

categorizes unpaid customer invoices based on the number of days they have been outstanding

c)

categorizes unpaid customer invoices based on how quickly they have been paid

d)

lists customers with unpaid balances in the order of least likely to most likely to pay

81.

Work-in-process inventory is made up of items that are kept on hand not to be sold, but instead to help the firm maintain consistent operations. Replacement parts for key manufacturing equipment is a good example of work-in-process inventory.

a)

True

b)

False

82.

When a company can determine, based on its history, that a certain percentage of its accounts receivable are typically not collectible—or when a company has identified specific individual accounts receivable that are likely not collectible—the company should establish a reserve for bad debts.

a)

True

b)

False

83.

1/1

Ideally, a good business succession plan is in writing and transparent to all of a business’s stakeholders so that, when the time comes to institute the plan, the process can move forward with those most affected by the plan both aware of and in agreement with the plan.

a)

True

b)

False

84.

A _______________ is a contract between a business’s owners that indicates the terms that will surround the purchase of an exiting owner’s interest in the business.

a)

non-compete agreement

b)

buy-sell agreement

c)

liquidation

d)

dissolution

85.

Legally terminating the existence of a business is called a ______________.

a)

non-compete agreement

b)

buy-sell agreement

c)

liquidation

d)

dissolution

86.

In order for a business owner to harvest cash via capital gain, the owner must sell 100% of his ownership of a business.

a)

True

b)

False

87.

An estimate of the value of a business most business brokers, M&A advisors, and investment banking firms consider to be the best estimate of the value of a business to be put on the

market for sale is called _______________.

a)

equity value

b)

enterprise value

c)

terminal value

d)

free cash flow

88.

_______________ is the process of a company willingly subjecting itself to a form of investigation by a potential buyer of the business or a potential new partner in the business.

a)

Due diligence

b)

The Gordon growth model

c)

Leveraged recapitalization

d)

A leveraged buyout

89.

A usually bulleted list of the significant conditions and circumstances associated with a proposed business arrangement is called a _______________.

a)

retainer

b)

term sheet

c)

selling memo

d)

due diligence list

90.

Which of the following statements is false with regard to selling a business?

a)

An asset-only purchase is often preferable for a buyer.

b)

In order to get the best price for your business, beyond sharing your financial statements, you’ll want to be able to produce two or three years of tax returns that are accurate, tie into your business’s financial statements, and demonstrate your business’s profitability.

c)

One type of professional help that’s almost always required when selling a business is the guidance of a good attorney.

d)

Selling a business, though generally a large and complex transaction, rarely brings with it significant emotional impact for a business owner.

91.

Attempting to sell a business should only occur after properly positioning the business for sale.

a)

True

b)

False

92.

Angel investors prefer to hold off on providing advice until after they have invested so they can focus on maximizing their returns.

a)

True

b)

False

93.

Connolly suggest when making your financial ask of an angel you should:

a)

Ask for how much you think you can get from the particular angel

b)

Only ask for how much you need

c)

Don't be afraid to to ask for a larger investment than is on the table

d)

Ask for twice what you need and hope to get half of it

94.

VCs are looking for opportunities to

a)

deploy millions of dollars

b)

get multiple times return on their investment

c)

take advantage of a large market

d)

all of the above

95.

Large venture funds like to make a lot of small ($100K) investments to test the market.

a)

True

b)

False

96.

When looking for a VC to make an investment, it is best to find a partner with ten or more current investments.

a)

True

b)

False

97.

When a VC decides to make an investment in a company, they will indicate it through what is called:

a)

an offer sheet

b)

a term sheet

c)

a due diligence request

d)

a valuation offer

98.

When evaluating an opportunity, investors look for

a)

founders with prior ventures

b)

founders with industry experience

c)

founders who have experienced stressful situations

d)

all of the above

99.

VCs look for opportunities that:

a)

a large target market

b)

significant growth potential

c)

limited competition

d)

all of the above

100.

VCs look for opportunities that:

a)

have products with proprietary features

b)

have intellectual property protection

c)

exclusive licenses and marketing relationships

d)

all of the above

Entrepreneurial Finance Big Quiz Year 2023

Total questions: 100

Worksheet time: 33mins

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