Deck 1: Introduction

Question 1

A mission statement is a comprehensive document that helps the entrepreneur analyze the market and plan the business strategy.

Answer 1

False

Question 2

A business plan is often prepared by an existing company to ensure that growth is properly managed.

Answer 2

True

Question 3

Business plans are often necessary to obtain financing.

Answer 3

True

Question 4

A two-page overview of the important facts in the business plan is called the "Key Points" section.

Question 5

A mission statement describes the purpose of the business and management philosophy.

Question 6

The mission statement is a concise, well-defined explanation of the purpose of the business and the management's philosophy.

Question 7

National trends do not have an impact on a company that operates only in a local area.

Question 8

The single most important demographic trend in the United States is that there are more women than men.

Question 9

Local trends do not have an impact on a company that has retail outlets throughout the United States.

Question 10

A comprehensive document that helps the entrepreneur analyze the market and plan the business strategy is a

A) mission statement.
B) business plan.
C) marketing strategy.
D) scan of the environment.

Question 11

Which of the following is true?

A) A business plan is often prepared by an existing company to ensure that growth is properly managed.
B) A business plan is often required in order to get financing.
C) If a business plan is completed for a start-up, it will help the entrepreneur avoid costly mistakes.
D) All of the above.

Question 12

Business plans for start-ups and existing businesses are similar; however,

A) the focus varies slightly.
B) the plan for an existing business has no executive summary.
C) the plan for a start-up has no executive summary.
D) the plan for an existing business does not need a section on location because the business has already leased or purchased a site.

Question 13

A two-page overview of the most important facts in the business plan is known as the

A) exclusive agreements.
B) relevant trends.
C) executive summary.
D) total business operation.

Question 14

Which of the following is included in an executive summary?

A) The product or service provided by the business
B) The most important trends in the industry
C) The type of advertising and promotion that will be implemented
D) All of the above

Question 15

A concise, well-defined explanation of the purpose of the
Business and the management's philosophy is known as the

A) executive summary.
B) business plan.
C) mission statement.
D) industry trends.

Question 16

Many experts suggest that the mission statement should be 50 words or less because

A) bankers don't want to read long documents.
B) that restriction forces the entrepreneur to be very focused.
C) the mission statement should be shorter than the statement of management philosophy.
D) all of the above.

Question 17

A mission statement describes

A) the purpose of the business and management philosophy.
B) the advertising that will be implemented.
C) the education and work experience of the entrepreneur.
D) all of the above.

Question 18

"To educate, inspire, and assist individuals and organizations of diverse cultures to conserve wildlife and other natural resources while protecting the Earth's environment to promote a peaceful, equitable, and sustainable future." This is the National Wildlife Foundation's

A) executive summary.
B) description of industry trends.
C) mission statement.
D) description of business environment.

Question 19

The mission statement

A) provides direction for the company.
B) helps prevent the company from diversifying into areas that do not serve the original company purpose.
C) should be written as the first step in developing a business plan.
D) all of the above

Question 20

Which of the following is included in an analysis of the business environment?

A) National trends
B) Local trends
C) Industry trends
D) All of the above

Question 21

Changes in demographic trends and an increase in the number of women working outside the home are examples of

A) national trends.
B) industry trends.
C) legislative trends.
D) none of the above.

Question 22

As the large number of baby-boomers ages and changes lifestyles, this has created a

A) decrease in the amount of goods and services sold.
B) threat to the survival of businesses.
C) demand for different products and services.
D) upheaval in the U.S. economy.

Question 23

The single most important demographic trend in the United States is the

A) fact that there are more women than men.
B) aging of the population.
C) large number of teenagers.
D) number of babies born each year.

Question 24

Demographic changes, lifestyle changes, and legislative
Trends are examples of

A) national trends.
B) industry trends.
C) local trends.
D) facts included in the mission statement.

Question 25

A competitive analysis examines the competitor's strengths and weaknesses.

Question 26

A competitive analysis should be completed before the entrepreneur develops his or her competitive strategy.

Question 27

When setting prices, two of the factors that must be considered are the competitor's prices and the desired company image.

Question 28

When setting prices, two of the factors that should be considered are channels of distribution and the compatibility of the prices with sales and production goals.

Question 29

If a company sells through middlemen such as wholesalers or manufacturer's representatives, this does not affect the company's pricing.

Question 30

Goals to be achieved with the pricing structure are known as pricing policies.

Question 31

General pricing guidelines are known as pricing objectives.

Question 32

Markup on cost and markup on selling price are pricing methods used in retailing.

Question 33

If a company ships goods F.O.B. seller, the buyer pays all shipping costs.

Question 34

If a company ships goods F.O.B. Buyer, the buyer pays all shipping costs.

Question 35

If all customers within the same demographic territory pay the same shipping cost, this is known as uniform-delivered pricing.

Question 36

The main reason for extending credit is to increase sales.

Question 37

The two general categories of credit are consumer credit and trade credit.

Question 38

Trade credit is credit extended from retail stores to the final consumer.

Question 39

A credit term of 2/10 net 30 means that the customer must pay 2% of the bill within 10 days, and the remainder within 30 days.

Question 40

A company's credit policy will have an effect on cash flow.

Question 41

A competitive advantage differentiates the company from its competitors.

Question 42

Typical competitive advantages include price, quality, and service.

Question 43

A company's location may be its competitive advantage.

Question 44

Separating customers into groups with similar needs is known as the company's competitive advantage.

Question 45

Separating customers by zip code is demographic segmentation.

Question 46

Separating customers according to their reason for purchasing the product is known as benefit segmentation.

Question 47

Grouping customers by how often they use a product or service is known as demographic segmentation.

Question 48

Grouping customers by how often they use a product or service is known as psychographic segmentation.

Question 49

Grouping customers based on their lifestyle is known as psychographic segmentation.

Question 50

A sustainable competitive advantage is one that is not easily copied.

Question 51

One of the first steps in selecting a location is to develop a list of required and desirable criteria.

Question 52

A geographically defined area in which customers are located is known as the market segment.

Question 53

Accessibility refers to the ease with which a customer can get to the business.

Question 54

Businesses that are adjacent to a retail business will not have an impact on the retail company's sales.

Question 55

Communities often have laws specifying the minimum number of parking places for retail stores.

Question 56

A site analysis for a manufacturing plant would include the labor climate, utility access, and environmental regulations.

Question 57

The labor climate includes the level of union activity, the average wage rates, and the work ethic of the residents.

Question 58

When selecting a site for a wholesale business, the financial health of the retail outlets would be considered.

Question 59

Business incubators are facilities that provide start-up firms with below-market rates for rent and shared use of equipment.

Question 60

Most start-up companies stay in incubators for approximately ten years.

Question 61

Direct marketing includes direct mail, mail-order catalogs, and direct selling.

Question 62

Public relations is company information released as news.

Question 63

The combination of direct marketing, advertising, sales promotion, publicity, and public relations is called the promotional mix.

Question 64

One of the best methods for determining the advertising budget is the objective and task method.

Question 65

Responsibilities of a sales manager include recruiting, training, and supervising the sales force.

Question 66

Cooperative advertising is a form of consumer promotion.

Question 67

Informative advertising explains the company's products and services and helps build the initial customer base.

Question 68

Maintenance advertising is used to convince the customer that the new company is better than the competition.

Question 69

Billboards are purchased in two forms-poster panels and painted bulletins.

Question 70

Outdoor advertising includes transit advertising.

Question 71

The number of people who will see or hear an ad is referred to as the reach.

Question 72

The number of customers reached through outdoor advertising is known as the delivery.

Question 73

The Yellow Pages has excellent selectivity.

Question 74

Outdoor advertising has poor selectivity.

Question 75

If an entrepreneur uses heavy promotion during peak selling seasons and no advertising during slow times, this is referred to as flighting.

Question 76

Using heavy promotion during peak selling seasons and no advertising during slow times is referred to as pulsing.

Question 77

Small businessses with a website face less competition on the Internet than in the regular marketplace.

Question 78

The most effective websites are those that are not part of a company's overall marketing strategy.

Question 79

The goal of public relations is to create a favorable impression with the public.

Question 80

Publicity and public relations are different names for the same thing.