Entrepreneurship Theory Process Practice

Business

Quiz 7 :

Pathways to Entrepreneurial Ventures

Quiz 7 :

Pathways to Entrepreneurial Ventures

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The Federal Trade Commission does not provide information on franchise success.
Free
True False
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False

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In purchasing an existing business, the first question should be: "Why are you selling?"
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True False
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True

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In negotiating a deal to purchase an existing business, it is possible to request that the seller retain a minority interest in the firm.
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True False
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True

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Franchisees have the option of using the logo and symbols of the franchisor.
True False
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Much franchise litigation has arisen over franchising fees.
True False
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It is always important that you weigh advantages against disadvantages in purchasing a franchise.
True False
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The terms upside gain and downside loss refer to the profits the business can make and the losses it can suffer.
True False
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The elimination of time and effort associated with starting a company is an advantage of acquiring an ongoing venture.
True False
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Entrepreneurs who exploit a radical new technology to provide a product and radically disrupt the market through the creation of a new product space represent the highest level of innovation "newness" relative to other alternatives.
True False
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The prospective investor should obtain as much information as possible on the franchisor.
True False
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Perhaps the greatest advantage of buying a franchise, as compared to starting a new business or buying an existing one, is that the franchisor will usually provide both training and guidance to the franchisee.
True False
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The most important area to examine prior to purchasing a business is company profitability.
True False
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The actual cost of "opening the doors" of a franchise establishment can be more than $200,000.
True False
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Sales records are of very little value to a buyer in evaluating a company's worth.
True False
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When purchasing an existing business, the prospective owner should conduct an assessment of the business's current group of employees.
True False
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It is not uncommon for a buyer to be faced with a franchise fee of $250,000 to $1,000,000.
True False
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Business brokers specialize in business opportunities and can provide leads and assistance in finding a venture for sale.
True False
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Uniqueness in a product or service can be demonstrated through a new-new approach or a new-old approach.
True False
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Generally, the larger and more successful the franchisor, the greater the franchise fee that is charged.
True False
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The way to approach a new business venture is to design a good or service that is unique.
True False
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