Question 1

Imagine you just started a landscaping business in an area that gets very little rain each year.Your market research indicated that the homeowners would pay top dollar to beautify their lawns.Besides advertising in the newspaper or on the radio,name three ways you could promote the business.

Accepted Answer

The answer of Imagine you just started a landscaping business...

Question 2

Even though it is a professional document filled with details and financial statements,it is important to capture the investor's attention by making the business plan interesting to read.

Accepted Answer

Yes, it is important to make the business plan interesting to read in order to capture the investor's attention. This can be achieved by using a clear and concise writing style, including engaging visuals and graphics, and highlighting the unique aspects of the business.

Question 3

You recently graduated from business school and you want to open up a small pizzeria in a large college town.There is a perfect space to lease for the pizzeria; however,a few doors down is a very well-established Italian restaurant that has been around since 1964.Their food has been legendary for all of those years.How would a market analysis help you decide if opening up the pizzeria near the restaurant would be a good idea or not?

Accepted Answer

The answer of You recently graduated from business school and...

Question 4

What is the purpose of the appendices in a business plan?
A) to provide additional information that adds to the credibility of your business plan
B) to summarize your business plan and to remind investors of the key points of the plan
C) to provide a summary of the projected income that has not been adequately provided within the plan
D) to provide key definitions for industry terms used in the plan as it will be read by non-industry experts
E) to provide a clear and concise (abbreviated) form of the entire business plan

Accepted Answer

The purpose of the appendices is to provide additional information that adds to the credibility of your business plan. This can include detailed financial projections, market research data, resumes of key team members, and other relevant information. By including this information in the appendices, you can avoid overwhelming your readers with too much detail in the main body of the plan, while still providing important backup information to support your claims and assumptions.

Question 5

Information on personnel recruitment belongs in the management team section of the business plan.

Accepted Answer

Information on personnel recruitment typically belongs in the Human Resources Management or Operations section of a business plan, not the Management Team section, which focuses on the current team's background and roles.

Question 6

The executive summary is so crucial that if it does not meet a potential investor's expectation,he or she might stop reading the plan and discard it.

Accepted Answer

The executive summary is often the first part of a business plan that an investor or reader will see, and it serves as a summary of the entire plan. If it doesn't pique the reader's interest or meet their expectations, they may not continue reading the rest of the plan. Thus, it is crucial to ensure that the executive summary is well-written and effectively conveys the key points of the plan.

Question 7

An exit strategy is often included in the financial section of a business plan.

Accepted Answer

An exit strategy is often included in the financial section of a business plan as it outlines how the owner or investors plan to cash out or exit the business in the future.

Question 8

Steven wants to buy ten acres of land and start an organic farm near his home.He does not think that he has time to write a business plan.Describe three potential consequences of NOT writing a business plan.

Accepted Answer

The answer of Steven wants to buy ten acres of...

Question 9

First describe a potential business you would like to start.Then describe three ways a business plan could help you be more successful.

Accepted Answer

The answer of First describe a potential business you would...

Question 10

Once a business has been operating for more than a year,it makes little sense to write a business plan if one has not been previously written.

Accepted Answer

It is always a good idea to periodically review and update a business plan, even if one has been previously written. The business environment can change quickly and a plan can help ensure the business stays on track and achieves its goals.

Question 11

What should NOT be stated in the financials section of the business plan?
A) length of time before investors receive revenue
B) amount of revenue to be paid to investors
C) total amount of money needed to operate business
D) total amount of compensation for employees
E) cash flow statement

Accepted Answer

The total amount of compensation for employees is typically not detailed in the financials section of a business plan. This section focuses more on broader financial projections, investment details, operational costs, and cash flow, rather than specific payroll information.

Question 12

Entrepreneurs should prepare their own financial statements and NOT use financial software because they need to fully understand how the numbers were generated.

Accepted Answer

While it is important for entrepreneurs to have a strong understanding of their financial statements, using financial software can actually help them generate accurate and reliable statements. The software can help automate calculations and provide financial insights, allowing entrepreneurs to focus on analyzing and utilizing the data, rather than spending time on manual calculations. However, it is still important for entrepreneurs to regularly review and understand their financial statements, regardless of how they were generated.

Question 13

Entrepreneurs must write their business plan before beginning their business.

Accepted Answer

Entrepreneurs do not necessarily have to write their business plan before beginning their business. Many successful businesses start with a basic idea and evolve over time, with the business plan being developed and refined as the business grows and its needs become clearer.

Question 14

"Indulge and treat yourself to a luxurious day at Shasta Mountain Spa and experience rejuvenation and peace" is a competitive advantage statement.

Accepted Answer

This statement is more of a marketing or promotional message aimed at enticing potential customers, rather than a clear competitive advantage statement which would specifically highlight what makes Shasta Mountain Spa uniquely better than its competitors.

Question 15

Dwayne is seeking financial assistance for his business and needs to include a statement of funding requirements in the business plan.The statement of funding requirement should include all of the following EXCEPT ________.
A) term of the loan
B) personal credit history
C) type of funding needed
D) amount of capital needed
E) an exit strategy

Accepted Answer

While personal credit history may impact the likelihood of obtaining funding and the terms of the loan, it does not belong in the statement of funding requirements. The statement should focus on the specific details of the funding being requested, such as the type of funding, amount needed, term of the loan, and exit strategy.

Question 16

All of the following are included within the business plan BEFORE the appendices EXCEPT ________.
A) marketing strategy
B) professional references
C) core production strategy
D) table of contents
E) company profile and strategy

Accepted Answer

The other options (marketing strategy, core production strategy, table of contents, company profile and strategy) are typically included within the business plan before the appendices, but professional references are not typically included in that section.

Question 17

Describe in a paragraph why a well-defined business plan may attract high-quality employees.

Accepted Answer

The answer of Describe in a paragraph why a well-defined...

Quiz 18: Constructing an Effective Business Plan