ENT 101 EXAM #1 STUDY GUIDE
Product - Answers - Something that exists in nature or is made by human beings. It is
tangible, meaning that it can be physically touched
Service - Answers - Labor or expertise exchanged for money. It is intangible. It cannot
be physically touched.
Entrepreneur - Answers - A person who recognizes an opportunity and organizes and
manages a business , assuming the risk for the sake of the potential return.
Necessity-based entrepreneurs - Answers - Enter entrepreneurship because
circumstances make self-employment their best available option for income
replacement.
Opportunity-based entrepreneurs - Answers - Start businesses to exploit a perceived
opportunity or to pursue one that they created.
Free-enterprise System - Answers - Characterized by private (rather than
governmental) ownership of capital assets and goods, and prices are determined by
markets; anyone is free to start a business.
Capitalism - Answers - The free-market system, characterized by individuals and private
companies, as opposed to governments, competing for economic gains, ownership of
private property and wealth, and price determination through free-market forces.
Capital - Answers - Cash or goods invested to generate income and wealth
Voluntary Trade - Answers - A market transaction between buyers and sellers who
willingly agree to trade.
Small Buisness - Answers - Having fewer than 500 employees and selling less than $5
million worth of products or services annually
Cost/benefit analysis - Answers - A decision-making process where the costs of taking
an action are compared to the benefits.
Salary - Answers - A fixed payment made at regular intervals, such as every week or
every month
Wage - Answers - A fixed rate per hour
Dividend - Answers - Pay yourself a portion of the business's profits, must be paid to all
shareholders
, Commission - Answers - A percentage of the value of a sale
Opportunity cost - Answers - The value of what must be given up to obtain something
else.
Social entrepreneurship - Answers - A for-profit enterprise with the dual goals of
achieving profitability and attaining beneficial returns for society
Social business - Answers - A company designed to address a social objective within
the highly regulated marketplace of today. It is distinct from a non-profit because the
business should seek to generate a modest profit, but this will be used to expand the
company's reach, improve the product or service, or in other ways to subsidize the
social mission.
Venture philanthropy - Answers - A subset or segment of social entrepreneurship.
Financial and human capital is invested in not-for-profits by individuals and for-profit
enterprises with the intention of generating social rather than financial returns.
Green entrepreneurship - Answers - Enterprise activities that avoid harm to the
environment or help to protect the environment in some way.
Micro-enterprises - Answers - A businesses with five or fewer employees, initial
capitalization requirements of less than $50,000, and the habitual operational
involvement of the owner. More than 60 percent of all U.S. firms have four or fewer
employees.
Lifestyle businesses - Answers - Micro-enterprises that permit their owners to follow a
desired pattern of living, such as supporting college costs or taking vacations.
Family enterprises - Answers - Companies owned and operated primarily by related
family members.
Corporate entrepreneurship - Answers - Occurs when an individual or team within an
existing corporation creates or identifies new opportunities for increased profits and/or
improved competitive position, secures the necessary resources, and creates value
through a new organization or innovation within the firm.
Franchise - Answers - A legal and commercial relationship between the owner of a
trademark, service mark, trade name, or advertising symbol and an individual or group
seeking to use that identification in a business.
Acquisition - Answers - A business purchase
Due diligence - Answers - The process used to learn about its true financial condition
(the current owners may have incentives to provide incomplete, misleading, or
inaccurate information), its reputation, and its continuing viability.
Product - Answers - Something that exists in nature or is made by human beings. It is
tangible, meaning that it can be physically touched
Service - Answers - Labor or expertise exchanged for money. It is intangible. It cannot
be physically touched.
Entrepreneur - Answers - A person who recognizes an opportunity and organizes and
manages a business , assuming the risk for the sake of the potential return.
Necessity-based entrepreneurs - Answers - Enter entrepreneurship because
circumstances make self-employment their best available option for income
replacement.
Opportunity-based entrepreneurs - Answers - Start businesses to exploit a perceived
opportunity or to pursue one that they created.
Free-enterprise System - Answers - Characterized by private (rather than
governmental) ownership of capital assets and goods, and prices are determined by
markets; anyone is free to start a business.
Capitalism - Answers - The free-market system, characterized by individuals and private
companies, as opposed to governments, competing for economic gains, ownership of
private property and wealth, and price determination through free-market forces.
Capital - Answers - Cash or goods invested to generate income and wealth
Voluntary Trade - Answers - A market transaction between buyers and sellers who
willingly agree to trade.
Small Buisness - Answers - Having fewer than 500 employees and selling less than $5
million worth of products or services annually
Cost/benefit analysis - Answers - A decision-making process where the costs of taking
an action are compared to the benefits.
Salary - Answers - A fixed payment made at regular intervals, such as every week or
every month
Wage - Answers - A fixed rate per hour
Dividend - Answers - Pay yourself a portion of the business's profits, must be paid to all
shareholders
, Commission - Answers - A percentage of the value of a sale
Opportunity cost - Answers - The value of what must be given up to obtain something
else.
Social entrepreneurship - Answers - A for-profit enterprise with the dual goals of
achieving profitability and attaining beneficial returns for society
Social business - Answers - A company designed to address a social objective within
the highly regulated marketplace of today. It is distinct from a non-profit because the
business should seek to generate a modest profit, but this will be used to expand the
company's reach, improve the product or service, or in other ways to subsidize the
social mission.
Venture philanthropy - Answers - A subset or segment of social entrepreneurship.
Financial and human capital is invested in not-for-profits by individuals and for-profit
enterprises with the intention of generating social rather than financial returns.
Green entrepreneurship - Answers - Enterprise activities that avoid harm to the
environment or help to protect the environment in some way.
Micro-enterprises - Answers - A businesses with five or fewer employees, initial
capitalization requirements of less than $50,000, and the habitual operational
involvement of the owner. More than 60 percent of all U.S. firms have four or fewer
employees.
Lifestyle businesses - Answers - Micro-enterprises that permit their owners to follow a
desired pattern of living, such as supporting college costs or taking vacations.
Family enterprises - Answers - Companies owned and operated primarily by related
family members.
Corporate entrepreneurship - Answers - Occurs when an individual or team within an
existing corporation creates or identifies new opportunities for increased profits and/or
improved competitive position, secures the necessary resources, and creates value
through a new organization or innovation within the firm.
Franchise - Answers - A legal and commercial relationship between the owner of a
trademark, service mark, trade name, or advertising symbol and an individual or group
seeking to use that identification in a business.
Acquisition - Answers - A business purchase
Due diligence - Answers - The process used to learn about its true financial condition
(the current owners may have incentives to provide incomplete, misleading, or
inaccurate information), its reputation, and its continuing viability.
