,DOWNLOADgTHEgTestgBankgforgEntrepreneurialgFinanceg6thgEditiongLeach
CHAPTERg2gDEVELOPIN
GgTHEgBUSINESSgIDEA
True-FalsegQuestions
T.
1.g Forgventuresgthatgfirstggetgtogmarketgorgcreategintellectualgpropertygri
ghts,git’sgcommongtogpricegnewgproductsgorgservicesgatghighgmarkupsgorgprofitg
margins.
F. 2.g Lifestylegfirmsgareggrowth-
drivengingtermsgofgrevenues,gprofits,gandgcashgflowsgandgalsogperformance-
orientedgasgreflectedgingrapidgvaluegcreationgovergtime.
T. 3.g “Salary-
replacement”gfirmsgprovidegtheirgownersgwithgincomeglevelsgcomparablegt
ogwhatgtheygcouldghavegearnedgworkinggforgmuchglargergfirms.
T.
4.g Angentrepreneurgmaygstartgagnumbergofgdifferentgtypesgofgbusinesses
,gincludinggsalary-
replacementgfirms,glifestylegfirms,gandgentrepreneurialgfirmsgorgventures.
F.
5.g “Entrepreneurialgventures”garegfirmsgthatgallowgownersgtogpursueg
specificglifestylesgwhilegbeinggpaidgforgdoinggwhatgtheyglikegtogdo.
F.
6.g Entrepreneurialgventuresgemphasizegsurvivalgandgprovidinggangac
ceptableglivinggforgtheirgownersgwithggrowthgbeinggagsecondaryggoal.
F.
7.g Agsoundgbusinessgmodelgisgagplangtoggenerateginvestorginterest,gmak
egprofits,gandggrowgassetginvestments.
T.
8.g Agsoundgbusinessgmodelgshouldgprovidegagplangtoggenerategrevenu
es,gmakegprofits,gandgproducegfreegcashgflows.
F.
9.g MarkgTwaingsaid:g “LikegIgtellganybody,gifgyougfailgtogplan,gyou’reg
planninggtogfail.”
T. 10.g Bestgpracticesgofghigh-growth,ghigh-
performancegfirmsgappliedgingthegmarketinggpracticesgareagincludeg“developin
ggnewgproductsgorgservicesgthatgaregconsideredgtogbegthegbest.”
mynursytest.store
,DOWNLOADgTHEgTestgBankgforgEntrepreneurialgFinanceg6thgEditiongLeach
F. 11.g Bestgpracticesgofghigh-growth,ghigh-
performancegfirmsgappliedgingthegmarketinggpracticesgareagincludeg“prepari
nggdetailedgmonthlygfinancialgplansgforgthegnextgyeargandgannualgfinancialgp
lansgforgthegnextgfivegyears.
10
mynursytest.store
, DOWNLOADgTHEgTestgBankgforgEntrepreneurialgFinanceg6thgEditiongLeach
Chapterg2:gDevelopinggthegBusinessgIdea 11
T. 12.g Bestgpracticesgofghigh-growth,ghigh-
performancegfirmsgappliedgingthegfinancialgpracticesgareagincludeg“preparinggd
etailedgmonthlygfinancialgplansgforgthegnextgyeargandgannualgfinancialgplansgfo
rgthegnextgfivegyears.
T. 13.g Bestgpracticesgofghigh-growth,ghigh-
performancegfirmsgappliedgingthegmanagementgpracticesgareagincludeg“asse
mblinggagmanagementgteamgthatgisgbalancedgingbothgfunctionalgareagcovera
gegandgindustry/marketgknowledge.”
T.
14.g Businessgopportunities,gbecausegtheygexistgingrealgtime,ghavegagr
elativelygnarrowgwindowgofgopportunitygtogbecomegagsuccessfulgbusinessgv
enture.gHowevergbeinggthegfirstgtogmarketgdoesgnotgguaranteegsuccess.
T.
15.gIdeasgthatgaregsaidgtogbeg“aheadgofgtheirgtime”garegtoogearlygto
becomegviablegbusinessgopportunitiesgforgtheginventorgorginnovator.
g
T.
16.g Oncegconceptualized,gagnewgideagshouldgbegexaminedgforgitsg
businessgfeasibility.
T.
17.g AgSWOTganalysisgisgangexaminationgofgthegstrengths,gweaknesses
,gopportunities,gandgthreatsgtogdeterminegthegbusinessgopportunitygviabilitygofg
angidea.
F.
18.g AgSWOTganalysisgfocusesgongstrengthsg(S),gworriesg(W),goppo
rtunitiesg(O),gandgtreatsg(T).
F.
19.g Ag“venturegopportunitygscreening”gisgthegsamegthinggasgpre
paringgagbusinessgplan.
T.
20.g AgSWOTganalysisgshouldgconsidergasgpotentialgstrengthsgorgweak
nessesgwhethergtheregaregunfilledgcustomergneedsgandgthegextentgtogwhichgint
ellectualgpropertygrightsgexist.
F.
21.g AgSWOTganalysisgshouldgconsidergthegextentgofgexistinggcompeti
tiongandgtheglikelihoodgofgsubstitutegproductsgorgservicesgasgpotentialgstrengt
hsgorgopportunities.
T.
22.g Venturegopportunitygscreeningginvolvesgassessmentgofgangidea’sg
mynursytest.store
CHAPTERg2gDEVELOPIN
GgTHEgBUSINESSgIDEA
True-FalsegQuestions
T.
1.g Forgventuresgthatgfirstggetgtogmarketgorgcreategintellectualgpropertygri
ghts,git’sgcommongtogpricegnewgproductsgorgservicesgatghighgmarkupsgorgprofitg
margins.
F. 2.g Lifestylegfirmsgareggrowth-
drivengingtermsgofgrevenues,gprofits,gandgcashgflowsgandgalsogperformance-
orientedgasgreflectedgingrapidgvaluegcreationgovergtime.
T. 3.g “Salary-
replacement”gfirmsgprovidegtheirgownersgwithgincomeglevelsgcomparablegt
ogwhatgtheygcouldghavegearnedgworkinggforgmuchglargergfirms.
T.
4.g Angentrepreneurgmaygstartgagnumbergofgdifferentgtypesgofgbusinesses
,gincludinggsalary-
replacementgfirms,glifestylegfirms,gandgentrepreneurialgfirmsgorgventures.
F.
5.g “Entrepreneurialgventures”garegfirmsgthatgallowgownersgtogpursueg
specificglifestylesgwhilegbeinggpaidgforgdoinggwhatgtheyglikegtogdo.
F.
6.g Entrepreneurialgventuresgemphasizegsurvivalgandgprovidinggangac
ceptableglivinggforgtheirgownersgwithggrowthgbeinggagsecondaryggoal.
F.
7.g Agsoundgbusinessgmodelgisgagplangtoggenerateginvestorginterest,gmak
egprofits,gandggrowgassetginvestments.
T.
8.g Agsoundgbusinessgmodelgshouldgprovidegagplangtoggenerategrevenu
es,gmakegprofits,gandgproducegfreegcashgflows.
F.
9.g MarkgTwaingsaid:g “LikegIgtellganybody,gifgyougfailgtogplan,gyou’reg
planninggtogfail.”
T. 10.g Bestgpracticesgofghigh-growth,ghigh-
performancegfirmsgappliedgingthegmarketinggpracticesgareagincludeg“developin
ggnewgproductsgorgservicesgthatgaregconsideredgtogbegthegbest.”
mynursytest.store
,DOWNLOADgTHEgTestgBankgforgEntrepreneurialgFinanceg6thgEditiongLeach
F. 11.g Bestgpracticesgofghigh-growth,ghigh-
performancegfirmsgappliedgingthegmarketinggpracticesgareagincludeg“prepari
nggdetailedgmonthlygfinancialgplansgforgthegnextgyeargandgannualgfinancialgp
lansgforgthegnextgfivegyears.
10
mynursytest.store
, DOWNLOADgTHEgTestgBankgforgEntrepreneurialgFinanceg6thgEditiongLeach
Chapterg2:gDevelopinggthegBusinessgIdea 11
T. 12.g Bestgpracticesgofghigh-growth,ghigh-
performancegfirmsgappliedgingthegfinancialgpracticesgareagincludeg“preparinggd
etailedgmonthlygfinancialgplansgforgthegnextgyeargandgannualgfinancialgplansgfo
rgthegnextgfivegyears.
T. 13.g Bestgpracticesgofghigh-growth,ghigh-
performancegfirmsgappliedgingthegmanagementgpracticesgareagincludeg“asse
mblinggagmanagementgteamgthatgisgbalancedgingbothgfunctionalgareagcovera
gegandgindustry/marketgknowledge.”
T.
14.g Businessgopportunities,gbecausegtheygexistgingrealgtime,ghavegagr
elativelygnarrowgwindowgofgopportunitygtogbecomegagsuccessfulgbusinessgv
enture.gHowevergbeinggthegfirstgtogmarketgdoesgnotgguaranteegsuccess.
T.
15.gIdeasgthatgaregsaidgtogbeg“aheadgofgtheirgtime”garegtoogearlygto
becomegviablegbusinessgopportunitiesgforgtheginventorgorginnovator.
g
T.
16.g Oncegconceptualized,gagnewgideagshouldgbegexaminedgforgitsg
businessgfeasibility.
T.
17.g AgSWOTganalysisgisgangexaminationgofgthegstrengths,gweaknesses
,gopportunities,gandgthreatsgtogdeterminegthegbusinessgopportunitygviabilitygofg
angidea.
F.
18.g AgSWOTganalysisgfocusesgongstrengthsg(S),gworriesg(W),goppo
rtunitiesg(O),gandgtreatsg(T).
F.
19.g Ag“venturegopportunitygscreening”gisgthegsamegthinggasgpre
paringgagbusinessgplan.
T.
20.g AgSWOTganalysisgshouldgconsidergasgpotentialgstrengthsgorgweak
nessesgwhethergtheregaregunfilledgcustomergneedsgandgthegextentgtogwhichgint
ellectualgpropertygrightsgexist.
F.
21.g AgSWOTganalysisgshouldgconsidergthegextentgofgexistinggcompeti
tiongandgtheglikelihoodgofgsubstitutegproductsgorgservicesgasgpotentialgstrengt
hsgorgopportunities.
T.
22.g Venturegopportunitygscreeningginvolvesgassessmentgofgangidea’sg
mynursytest.store
