Question 1

Small businesses employ over half of all private workers.

Accepted Answer

According to the Small Business Administration (SBA), small businesses employ 58.9 million people in the United States, which is over half of all private workers.

Question 2

A not-for-profit organization has as its purpose to provide some service or good with no intention or goal of earning a profit and has met the requirements of the U.S. Internal Revenue Service tax code as a tax-exempt organization.

Accepted Answer

This statement is true according to the definition of a not-for-profit organization and the qualifications for tax-exempt status.

Question 3

Research has shown that small firms that mixed efficiency (low-cost)and flexibility (differentiation)strategies significantly outperformed those firms that utilized one or the other.

Accepted Answer

False

Question 4

In almost every study, strategy research has shown positive linkages between planning and business performance.

Accepted Answer

Research on the relationship between planning and business performance has shown mixed results, with some studies finding positive linkages, while others have found no significant relationship or even negative effects.

Question 5

Small businesses represent more than 99 percent of all employers.

Accepted Answer

According to the Small Business Administration (SBA), small businesses account for over 99 percent of all employers in the United States.

Question 6

Entrepreneurial ventures pursue opportunities, are characterized by innovative practices, and have growth and profitability as their main goals.

Accepted Answer

This statement accurately defines the characteristics of entrepreneurial ventures. They are driven by identifying and pursuing opportunities, utilizing innovative practices, with a main focus on achieving growth and profitability.

Question 7

Public sector organizations are not considered to be not-for-profit organizations.

Accepted Answer

Public sector organizations can be either for-profit or not-for-profit, depending on their specific charter and purpose. Some public sector organizations, such as public hospitals or schools, may be considered not-for-profit, while others, such as government-owned utility companies or transportation systems, may operate with a profit motive.

Question 8

Economists suggest that most small businesses are not particularly good at creating jobs.

Accepted Answer

According to economists, most small businesses do not create many jobs. While small businesses are important for economic growth and innovation, they tend to have limited resources and may not have the capacity to hire many employees. Additionally, many small businesses are focused on providing services or products to a local market, which may not require a large workforce. However, there are exceptions to this, such as small businesses that are able to scale up quickly and create many jobs.

Question 9

A small business is one that has fewer than 100 employees.

Accepted Answer

The definition of a small business varies by country and industry, but in the United States, the Small Business Administration (SBA) typically defines a small business as one with fewer than 500 employees for most manufacturing and mining industries, and less than $7.5 million in average annual receipts for many non-manufacturing industries.

Question 10

Both small businesses and entrepreneurial ventures play an important role in the global economy.

Accepted Answer

Both small businesses and entrepreneurial ventures contribute significantly to the economy by creating jobs, driving innovation, and improving productivity. They are essential to the growth and development of industries and the overall economy, especially in creating competition and promoting economic diversity.

Question 11

Entrepreneurial ventures and small businesses are not the same.

Accepted Answer

Entrepreneurial ventures refer to innovative and often high-risk businesses that aim for rapid growth and profitability, whereas small businesses may not necessarily be innovative or high-risk and may have a focus on providing stable income and longevity. Therefore, while all entrepreneurial ventures may be small businesses, not all small businesses are entrepreneurial ventures.

Question 12

Recruiting, motivating, and retaining employees is a big challenge for all organizations.

Accepted Answer

This statement is true. Attracting and keeping talented employees is a constant challenge for businesses of all sizes and in all industries. It requires a strategic approach to recruiting, creating a positive work environment, providing opportunities for growth and development, and offering competitive compensation and benefits.

Question 13

Developing a sustainable competitive advantage is important for all organizations.

Accepted Answer

Developing a sustainable competitive advantage is a crucial aspect for the long-term success of any organization. This advantage enables the company to differentiate its products or services from competitors, attract and retain customers, and ultimately generate higher profits. Without a sustainable competitive advantage, a company may struggle to maintain its market position and face challenges in the long run.

Question 14

Small businesses account for over 90 percent of the private sector output.

Accepted Answer

Small businesses are a significant part of the economy, but they do not account for over 90 percent of the private sector output. Larger businesses contribute a substantial portion of the output as well.

Question 15

Some small businesses are ineffective in part due to the "boiled frog phenomenon."

Accepted Answer

The boiled frog phenomenon refers to a situation where small problems or changes within a business go unnoticed and unaddressed until they escalate into large issues that harm the overall effectiveness of the business. This can lead to failure over time if not addressed.

Question 16

The process in which existing products, processes, ideas, and businesses are replaced with better ones is creative destruction.

Accepted Answer

Creative destruction is a term coined by economist Joseph Schumpeter to describe the process in which innovation and technological advances lead to the decline and eventual replacement of existing products, processes, ideas, and businesses by superior ones. This process is considered a driving force of economic growth and progress.

Question 17

A small business is defined as one that is independently owned, operated, and financed; has fewer than 100 employees; engages in innovation marketing practices; and has relatively little impact on its industry.

Accepted Answer

A small business is typically defined as one that is independently owned and operated, often with a small number of employees, but the specific criteria (such as the number of employees) can vary by country and industry. The definition does not necessarily include engaging in innovative marketing practices or having a relatively little impact on its industry.

Question 18

Small businesses and entrepreneurial ventures can compete successfully in narrow market niches by developing a low-cost, differentiation, or integrated competitive advantage.

Accepted Answer

Small businesses and entrepreneurial ventures can indeed compete successfully in narrow market niches by developing a low-cost, differentiation, or integrated competitive advantage. By focusing on a specific market segment and offering a unique product or service, they can stand out and attract customers even in markets dominated by larger players.

Question 19

The main difference between large and small organizations' strategy evaluation efforts will be in terms of the magnitude or extent of evaluation that is done.

Accepted Answer

Large organizations typically have more resources and access to more data than small organizations, so they may conduct more detailed and comprehensive evaluations of their strategies. However, both large and small organizations should still engage in some level of strategy evaluation to ensure they are on track to meet their goals.

Question 20

Innovation is the process of creating, changing, experimenting, transforming, and revolutionizing.

Accepted Answer

Innovation involves all of those processes - creating, changing, experimenting, transforming, and revolutionizing - in order to introduce something new or improved into the world.

Quiz 8: Module Special Topics in Strategy