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WorksheetsEntrepreneurship Unit 2 Quiz
Total questions: 120
Worksheet time: 3hrs 30mins
What does the Entry Cost Valuation method focus on?
Fair market value of assets
Future earning potential
Estimated cost of replicating the business
Market price per share
Which of the following is NOT a consideration in the Entry Cost Valuation method?
Hiring and training personnel
Future market trends
Developing intellectual property
Acquiring necessary assets
What does the Asset-Based Approach primarily value?
Market price per share
Fair market value of assets
Book value of the company
Future cash flows
What is a limitation of the Asset-Based Approach?
It considers future earning potential
It may undervalue intangible assets
It accurately reflects market conditions
It is easy to calculate
How is Net Book Value calculated?
Total Assets x Total Liabilities
Total Assets / Total Liabilities
Total Assets - Total Liabilities
Total Assets + Total Liabilities
What is a limitation of the Book Value Method?
It reflects true market value
It considers future earning potential
It can be manipulated through accounting practices
It is based on fair market value
What does the Price/Earnings Ratio (P/E Ratio) compare?
Total assets to total liabilities
Earnings per share to total liabilities
Market price per share to earnings per share
Market price per share to total assets
What does a higher P/E ratio often indicate?
Negative market sentiment
No growth expectations
Higher growth expectations
Lower growth expectations
What is a limitation of the P/E Ratio?
It is based on historical data
It can be influenced by market sentiment
It considers future cash flows
It reflects intrinsic value accurately
What does the Discounted Cash Flow (DCF) method determine?
Book value of assets
Fair market value of liabilities
Present value of future cash flows
Future market trends
What is involved in the DCF method?
Calculating book value
Projecting future cash flows
Determining liquidation value
Assessing market presence
Which valuation method may not accurately reflect current market conditions?
Price/Earnings Ratio
Asset-Based Approach
Entry Cost Valuation
Book Value Method
What is the focus of the Book Value Method?
Market price per share
Intangible assets
Accounting records
Future cash flows
Which method is used to compare a company to its industry peers?
Discounted Cash Flow
Entry Cost Valuation
Asset-Based Approach
Price/Earnings Ratio
What is a key consideration in the Entry Cost Valuation method?
Acquiring necessary assets
Book value of the company
Market price fluctuations
Future earning potential
Which of the following is NOT one if the types of venture models;
promising start-ups
ventured-backed start ups
initial public offering
corporate-supported start-ups
Which of the following is NOT a method used in business venture valuation?
cash flow statement
entry cost valuation
asset-based approach
book value method
What is the primary focus of Discounted Cash Flow method in venture valuation?
Assessing the market share
Predicting the stock price
Estimating the present value of future cash flows
Calculating the total revenue
How is Asset-Based Valuation different from Discounted Cash Flow method?
Discounted Cash Flow method focuses on the value of the company's liabilities
Asset-Based Valuation focuses on the company's future cash flows
Discounted Cash Flow method focuses on the value of the company's brand
Asset-Based Valuation focuses on the value of the company's assets
What does Book Value Method primarily consider in venture valuation?
Value of assets and liabilities
Revenue and expenses
Customer satisfaction and brand recognition
Market share and competition
What types of assets are considered in Asset-Based Valuation?
Intellectual property and patents
Real estate and stocks
Cash and liabilities
Tangible and intangible assets
The MOST appropriate form of financing during the rapid growth stage of a venture is
first-round financing
start-up or seed financing
public and seasoned financing
second-round or mezzanine financing
During which stage of a venture‟s life cycle may first-round external financing be utilized?
Survival
Maturity
Start-up
Rapid growth
Which valuation method may become subjective if the shares for a company are NOT traded on the stock market?
Income capitalization
Book value (balance sheet value)
Price earning (multiple earnings value)
Discounted future earnings (discounted cash flow)
Which method is NOT an income valuation method?
Income capitalization
Book value (balance sheet value)
Price earning (multiple earnings value)
Discounted future earnings (discounted cash flow)
The process of buying and selling via the internet is called
E-commerce
E-marketing
E-banking
E-communication
Which of the following products are NOT suitable for online selling?
CDs
Books
Fresh vegetables
Financial services
Which of the following statements is NOT a feature of business ventures?
Ventures are sown.
Ventures can be grown.
Ventures are harvested.
Ventures can be exported
At which stage of the venture life cycle does the entrepreneur create the capacity to possess the product or service?
Start-up
Innovation
Venture growth
New venture development
Which of the following is a factor to consider before launching into E-commerce?
Location
Nationality
Bandwidth
Data mining
Which of the following venture valuation methods takes the time value of money into account?
Book value
Price earnings
Payback period
Discounted future earnings
Which of the following strategies can promote success in E-commerce?
Focusing on market needs
Minimizing the use of emails (C) De-emphasizing strategic alliances (D) Focusing on corporate social responsibility
De-emphasizing strategic alliances
Focusing on corporate social responsibility
The stage in the venture life cycle where the entrepreneur can consider entering other target markets is described as
growth
decline
start-up
business stabilization
One reason for valuing a venture fairly accurately is to
promote goodwill
avoid under-harvesting
enhance accountability
avoid customer complaints
As in the brick and motar model, a frequent- buyer programme can help an e-commerce intiative establish
Privacy
Loyalty
Security
Flexibility
Many attempts at e--commerce fail because of the belief that
Technology is all that is needed
The most important factor is strategy
Too much security is better than too little
Online sales can lead to new growth opportunities
Company Adi sells products to individuals. What EC classification do they fit?
B2C
B2B
C2C
P2P
E-Commerce is the process of buying, selling or exchanging products, services or information via computer.
Yes
No
Which of the following best describes e-commerce?
Doing Business electronically
Doing business
Sale of goods
All of the abive
E-Commerce stands for
(a)
Which of the following may be considered an activity that falls under the corporate social responsibility of a lumber company?
Cash donations towards reforestation
Supporting company fun-day celebration
Increasing workers‟ salaries and wages
Spearheading the growth of the company
A Caribbean government recently asked an airline to obtain a license before operating in that territory. This means the airline was being asked to satisfy
a social obligation
a legal requirement
an ethical obligation
a corporate social responsibility
When an existing company grants a license to another company to operate using the formers name and design to provide the same service, the arrangement is called
a franchise
a partnership
an undertaking
limited liability
Which of the following contains guidelines for regulating process and service standards irrespective of the type of business?
COSSH
ISO Standards
Employee Handbook
Economic Partnership Agreement
Which of the following types of business has unlimited life and allows for the easy transferability of ownership interest?
Partnership
Corporation
Sole proprietorship
Limited liability partnership
The Corporate Charter is BEST described as the
basic legal declaration contained in the bylaws
legal document that establishes the corporation
set of rules and procedures established to govern the daily operations of the corporation
document that governs the relationship between the workers of the corporation and management
Which of the following courses of action is available to the regulatory agency in a country if a registered company fails to pay its taxes?
Prosecute the company
Arrest the company's employees
Cut the company's source of raw material supply
Ask buyers to boycott the company's products
An entrepreneur wishing to adopt open innovation must
Maximize the returns of shareholders
Focus on the firm’s core competencies
Build an internal collaboration network
Be willing to collaborate with customers and competitors
In a partnership venture, the partners share the management, profits, and debts of their business based on the terms of their
Friendship or relationship
Capital contribution
Deed of partnership
By-laws
One advantage of the franchise approach to business is that the entrepreneur gets more
Profit
Guidance
Capital
Partners
In the contact of venture operations, a whistle-blower is a person who
Reports illegal and unethical behavior
Speaks loudly during the decision-making process
Contributes capital but is inactive in managing the business
Seeks new innovative ways of doing things within a business
Which of the following is a distinguishing feature of the social entrepreneur
In business to create a profit
Takes environmental objectives into consideration
Highly inclined towards socializing and networking
Repeatedly starts and manages several companies at the same time
The primary purpose of a cooperative is to
break - even
push the economic interest of members
improve the standard of living of the country
bring together a group of existing companies to form one company
Phillip a young designer is desperate for his new clothing line to become successful. To help his chances, he begins to copy the designs of prominent designers. This is in breach of
Tax laws
Labour laws
ISO Regulations
Intellectual property laws
If a business is listed on the stock exchange
it means that it is a
private company
limited partnership
limited liability company
non-governmental organisation
Market research is the process of obtaining information on
the source of financing for the business
the strengths and weaknesses of a business idea
developing the best recruitment and selection model
how the business can create value and manage its operations
Which element of research is concerned with targeting specific customers with niche marketing campaigns?
Customer analysis
Promotion strategy
Expected sales trend
Product characteristics
Which of the following are considered when doing a personality SWOT analysis?
Grades, parent's money, movies, friends
Race, neighborhood, age, fashion sense
Market conditions, economy, taxation, liability
Skills, education, negative work habits, your industry
Which of the following financial statements gives a comprehensive view of the firm's profitability?
Cash budget
Balance sheet
Income statement
Cash flow statement
Which of the following is a form of equity finance for a start-up?
Loans
Debentures
Personal savings
Issuing bonds
The period it takes a business to earn a profit after the initial investment is known as
pay back
liquidity
solvency
profitability
Patrick is a novice entrepreneur. He has to prepare a business model for his business plan. Which of the following components of the business model will determine for whom he has to create value?
Beneficiary
Value proposition
Income generation
Product differentiation
During which stage of a venture's life cycle may first-round external financing be utilized?
Survival
Maturity
Start-up
Growth
The financial statement that shows the value of an organization's assets, liabilities and owner's equity is the
Income statement
Cash flow statement
Balance sheet
Cash budget
Which of the following is a KEY component of a business plan?
Venture logo
SWOT analysis
Value Proposition
Executive summary
The point at which a venture is neither making profits nor losses is described by the term
pay back
break even
cash strap
start-up
Which of the following is NOT a key aspect of the feasibility analysis for a new venture?
Time
Culture
Finance
Employment
Which of the following is a savings and investment option?
Fixed deposit
Loan
Cash
Inventory
A short-term debt obligation backed by the government with a maturity of less than one year is known as a
Bond
Fixed deposit
Stock
Treasury bill
The net change in cash and cash equivalents is
$4 million (increase)
$4 million (decrease)
$27 million (increase)
$6 million (decrease)
Which section of a business plan provides information about staffing?
Finance
Marketing
Operations
Management
Which method is NOT an income valuation method?
Income capitalization
Book value
Price-earnings
Discounted cash flow
Using the book value approach calculate the book value of an asset if the original cost was $10,000 and accumulated depreciation totaled $2,300 after 3 years:
$12,300
$7,700
$6,900
$7,000
Which of the following products are not suitable for online selling?
Fresh vegetables
Books
CD's
Financial services
What is the price earnings multiple (ratio) for this firm?
2
8
10
12
Which of the following is a factor to consider before launching into e-commerce?
Location
Nationality
Bandwidth
Data mining
Which of the following strategies can promote e-commerce success?
Promotion online and offline
Minimizing the use of emails
Focusing on corporate social responsibility
De-emphasizing strategic alliances
When a venture first begins operations it experiences
low sales, high costs
low sales, low costs
high sales, low costs
high sales, high costs
Many attempts at e-commerce fail because of the belief that
the most important factor is strategy
all you need is technology
too much security is better than too little
online sales can lead to new growth opportunities
At which stage of the venture's life cycle is innovation critical for the survival of the venture?
Growth
Decline
Start-up
Acceleration
To reward employees, businesses may allow them to purchase shares at a predetermined price, effectively making them part owners of the firm. This practice is
Deregulation
Reward programme
Employee stock option plan
None of the above
As in a brick and mortar model, a frequent buyer programme can help e-commerce ventures establish customer
loyalty
security
privacy
flexibility
Which of the following is NOT an approach to e-commerce
Online shopping malls
Own website
Partnering with payment service providers
Partnering with sole traders
Many unknown recording artistes use the Internet and You Tube because of
speed and flexibility
access to global market
potential to increase sales
potential to improve margins
When assessing the online potential of a business venture, consideration should be given to
data mining, target markets, difficulty of access to offline customers
appeal to customers, online shopping malls, data mining
appeal to customers, target markets, costs and benefits
costs and benefits, domain name
The following would appear in which section of the cash flow statement?
Cash payments for purchasing inventory
Operating
Investing
Financing
The following would appear in which section of the cash flow statement?
Cash received from a business investor
Operating
Investing
Financing
The following would appear in which section of the cash flow statement?
cash payments for equipment
Operating
Investing
Financing
The following would appear in which section of the cash flow statement?
cash received from sales of services
Operating
Investing
Financing
Selling and distributing merchandise sold by the company
Operating
Investing
Financing
Borrowing cash from a bank for additional working capital
Operating
Investing
Financing
Gross profit is calculated by...
Revenue - Expense
Revenue + Expense
Revenue - Liabilities
Revenue + Liabilities
Revenue and Expenses
Which of the following means money spent?
income
expense
net income
gross income
Which of the following means money received?
net loss
net gain
insurance
income
When expenses are greater than income?
expense
net loss
net income
net gain
If total expenses exceed total revenue, a net loss is reported.
True
False
If total sales is 20,000 and Total Expenses is 1000, then profit will be:
21000
19000
1000
It informs the users of the financial condition of the business at a given date.
Statement of Financial Position
Financial Statement
Statement of Income
Another name for the statement of Financial Position.
Balance Sheet
Income Statement
Pofit and Loss Statement
A debt or obligation owed to others.
Liabilities
Assets
Owner's Equity
Cash in Bank is classified as
Current Asset
Current Liability
Noncurrent Asset
Noncurrent Liability
Account Receivable is classified as
Current Asset
Current Liability
Noncurrent Asset
Noncurrent Liability
Furniture and Fixtures is classified as
Current Asset
Current Liability
Noncurrent Asset
Noncurrent Liability
Two types of Financial Statement Account:
General and Journal Form
Report and Account Form
Statement of Cash flow and Income Statement
Also known as the "Long-term Assets"
Non-current Assets
Current Assets
Non-current liabilities
Current Liabilities
What term refers to the process of starting a new business, typically involving the creation and development of innovative ideas into profitable ventures?
Marketing
Entrepreneurship
Investment
Management
________ is conducted to determine whether a proposed business has sufficient management expertise, organizational competence, and resources to successfully launch its business.
B) Financial feasibility analysis
C) Organizational feasibility analysis
E) Institutional feasibility analysis
