Deck 4: External Analysis

Question 1

When growing a business, the owner needs to define who the likely customers are in order to expand.

Answer 1

False

Question 2

Opening a restaurant on a college campus does not make it competitive with all the other restaurants in the city around the campus.

Answer 2

False

Question 3

Alyss opened a trendy new restaurant; her customer base includes individuals ages 5 to 95 who live within 50 miles of her restaurant.

Answer 3

False

Question 4

After drawing a geographical radius around the business, the owner should define the customer base that resides within that radius.

Question 5

James drew a 10 mile geographical radius around his location to identify potential customers; his next step is to define the customer base.

Question 6

A competitive map shows where all your competitors are located.

Question 7

A resource-based analysis of a company assists the entrepreneur to understand what creates an orthodox practice.

Question 8

An effective industry analysis identifies:

A) product pricing
B) unusual or unique competitive factors
C) substitutes
D) potential customers

Question 9

A competitive map is used for the following reasons:

A) It's less expensive.
B) Insights will be developed regarding pricing.
C) Knowledge about each competitor allows the entrepreneur to better position the new business.
D) All of these.

Question 10

In developing a competitive map, an owner should review:

A) population of the area
B) household income
C) average spending per product or service
D) all of these

Question 11

After completing a competitive map, an owner can decide to:

A) accept the data and go forward with the business
B) not accept the data and cancel the project
C) not do anything with the data
D) all of these

Question 12

_________ demonstrates how easy it is for a customer to switch to substitutes.

A) Elasticity of demand
B) Competitive map
C) Trade-in
D) Benchmarking

Question 13

According to the book, which of the following sequences is correct when you want to start a new business?

A) Identify the exact competitors within that industry, determine who your potential customers might be, define the industry that interests you
B) Define the industry that interests you, determine who your potential customers might be, identify the exact competitors within that industry
C) Determine who your potential customers might be, identify the exact competitors within that industry, define the industry that interests you
D) Identify the exact competitors within that industry, define the industry that interests you, determine who your potential customers might be

Question 14

Which of the following is an example of a fragmented market?

A) pool building companies
B) fast food restaurants
C) hardware stores
D) department stores

Question 15

Which of the following is a product of the Case Study, Guayaki Sustainable Rainforest Products Inc?

A) Umbrellas
B) Rain boots
C) Coffee substitutes
D) Swimwear

Question 16

In the Case Study, Guayaki Sustainable Rainforest Products Inc, the idea for Yerba Mate was based on:

A) A previous business idea
B) A student project
C) A family business
D) None of these

Question 17

When analyzing which aspect of the home health business to focus on, Betty and Joan decided to focus on:

A) The routine domestic element
B) The medically necessary element
C) Both of these
D) None of these

Question 18

Betty and Joan's perfect customer would be:

A) Very Wealthy
B) Very Poor
C) Upper Middle Income
D) Lower Middle Income

Question 19

In the case study, Flow Right Brewery & Bar: A Family Affair, Chris' target customer turned out to be:

A) Beer connoisseurs
B) Young professional who liked beer
C) Alcoholics
D) None of these

Question 20

In the case study, Flow Right Brewery & Bar: A Family Affair, Chris analyzed his competition by developing a(n):

A) External Analysis
B) Competitive Map
C) Both of these
D) None of these