Business Plan Development Practice Exam
Course Introduction
Business Plan Development equips students with the essential skills and methodologies needed to create comprehensive and effective business plans for new ventures or existing enterprises. The course explores the fundamental components of a professional business plan, including market research, competitive analysis, organizational structure, operations, product or service strategies, marketing plans, and financial projections. Through practical assignments, real-world case studies, and collaborative projects, students learn how to synthesize research, articulate business concepts clearly, and present their plans to diverse stakeholders, preparing them to launch successful ventures or contribute strategically within dynamic business environments.
Recommended Textbook
Entrepreneurship Theory Process and Practice 9th Edition by Donald F. Kuratko
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15 Chapters
1181 Verified Questions
1181 Flashcards
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Chapter 1: Entrepreneurship: Evolutionary
Development-Revolutionary Impact
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95 Verified Questions
95 Flashcards
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Sample Questions
Q1) The word entrepreneur is derived from the French entreprendre, which is translated as
A) to apprehend
B) to undertake
C) to compete
D) to enter and dare
Answer: C
Q2) The financial/capital entrepreneurial school of thought focuses on the potential profit of the business idea.
A)True
B)False
Answer: False
Q3) In the evolutionary process of economic growth, _________ plays the crucial and indispensable role of providing the "social glue" that binds together both high-tech and "Main Street" activities.
A) entrepreneurship
B) supply and demand
C) the Internet
D) management
Answer: A
Page 3
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Chapter 2: The Entrepreneurial Mind-Set in Individuals:
Cognition and Ethics
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97 Verified Questions
97 Flashcards
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Sample Questions
Q1) What kind of thinking can lead to unethical behavior in a business context?
A) top line
B) bottom line
C) abstract
D) critical
Answer: B
Q2) Morals and law are not synonymous but may be viewed as two circles that are partially superimposed upon each other.
A)True
B)False
Answer: True
Q3) The "dark side" of entrepreneurship refers to
A) a destructive force within the energetic drive of entrepreneurs.
B) the part of entrepreneurship that is most exciting.
C) a misunderstanding about the results of entrepreneurship.
D) another myth of entrepreneurship.
Answer: A
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Page 4
Chapter 3: The Entrepreneurial Mind-Set in Organizations: Corporate Entrepreneurship
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85 Verified Questions
85 Flashcards
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Sample Questions
Q1) Employees shouldn't expect feedback on their entrepreneurial ideas.
A)True
B)False Answer: False
Q2) One step an organization can take to make its corporate environment more innovative is to
A) gain top management support of an entrepreneuring program.
B) fire top management and hire young executives.
C) change the dress code to "casual attire."
D) give across-the-board raises.
Answer: A
Q3) When an entrepreneurial environment is created, a company does not usually set aside the traditions of the company.
A)True
B)False
Answer: False
Q4) Another common name for an I-Team is an intrapreneurial team.
A)True
B)False Answer: False
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Chapter 4: Social Entrepreneurship and the Global
Environment for Entrepreneurship
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50 Verified Questions
50 Flashcards
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Sample Questions
Q1) Methods for going international include all of the following except
A) importing
B) exporting
C) licensing
D) foreign reclamation
Q2) NAFTA (North American Free Trade Agreement) offers strong protection for
A) patents and copyrights
B) patents but not copyrights
C) patents and copyrights but not trade secrets
D) patents, copyrights, and trade secrets
Q3) The triple bottom line is an accounting framework that focuses on optimizing short-term financial performance.
A)True
B)False
Q4) Bottom-line measures of social performance include the unemployment rate and health-adjusted life expectancy.
A)True
B)False
Page 6
Q5) In the context of benefit corporations, what does transparency refer to?
Q6) Why is global thinking important to today's entrepreneurs?
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Page 7
Chapter 5: Innovation: The Creative Pursuit of Ideas
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95 Verified Questions
95 Flashcards
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Sample Questions
Q1) Describe the innovation process.
Q2) Which of the following are causes of industry and market changes?
A) process needs
B) advancements in technology
C) unexpected occurrences
D) natural disasters
Q3) Which of the following mental habits inhibit creativity and innovation?
A) either/or thinking, stereotyping
B) functional perspective, mind-sets
C) security hunting, risks
D) stereotyping, incubation
Q4) Which of the following statements is True?
A) The right brain is more important in the creative process than the left brain.
B) The left brain is more important in the creative process than the right brain.
C) Both sides of the brain are important to the creative process.
D) Motivation, not the brain is the key to the creative process.
Q5) Creativity is most likely to occur when the "climate" is right. The text listed several important characteristics of this climate. What is the right climate?
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Chapter 6: Assessment of Entrepreneurial Opportunities
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82 Verified Questions
82 Flashcards
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Sample Questions
Q1) A new venture must go through _____ phases.
A) five
B) two
C) three
D) seven
Q2) General sources for a market feasibility analysis include
A) reliability studies.
B) statistical analyses.
C) pricing data.
D) supplier data.
Q3) There are five specific phases that a new venture goes through.
A)True
B)False
Q4) When premature entry into the marketplace causes the failure of a new venture, it can be termed
A) poor timing.
B) undercapitalization.
C) a design problem.
D) a distribution problem.
Q5) Explain three major reasons why new ventures fail.
Page 9
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Chapter 7: Pathways to Entrepreneurial Ventures
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75 Verified Questions
75 Flashcards
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Sample Questions
Q1) Which of the following is not currently cited as a trend creating business opportunities?
A) green products
B) breakfast cereals
C) health care
D) concierge services
Q2) Why did the Federal Trade Commission enact the Franchise Rule?
Q3) It is not uncommon for a buyer to be faced with a franchise fee of $250,000 to $1,000,000.
A)True
B)False
Q4) Which of the following costs add to the cost of franchising?
A) insurance
B) payroll
C) legal and professional fees
D) all of the above
Q5) In negotiating a deal to purchase an existing business, it is possible to request that the seller retain a minority interest in the firm.
A)True
B)False
Page 10
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Chapter 8: Sources of Capital for Entrepreneurs
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Sample Questions
Q1) An informal risk capitalist is referred to as:
A) your neighbor.
B) a business angel.
C) a retiree.
D) someone with extra money to invest but who is not interested becoming an entrepreneur.
Q2) Public offering is a term used to refer to corporations taking public donations to raise capital.
A)True
B)False
Q3) The Regulation D exemptions include all of the following except:
A) placements of up to $5 million.
B) placements of less than $500,000.
C) placements in excess of $5 million.
D) placements in excess of $l0 million.
Q4) When going public specific detailed information that must be presented includes A) a 20-year plan.
B) the capital structure of the company.
C) any financial conflicts of interest.
D) any previous business failures.
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Chapter 9: Legal Challenges of Entrepreneurial Ventures
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Sample Questions
Q1) Who defined the corporation as "an artificial being, invisible, intangible, and existing only in contemplation of the law."
A) Karl Marx
B) Justice John Marshall
C) Henry Ford
D) Thomas Jefferson
Q2) Which of the following are suggestions to minimize legal costs?
A) visit the lawyer during normal hours of operation
B) have the lawyer custom design forms specifically for you
C) always handle matters personally
D) try to avoid hiring a lawyer if and until an emergency requires it
Q3) Straight bankruptcy is often called liquidation.
A)True
B)False
Q4) According to the U.S. Patent Office, the process of obtaining a patent takes how many months?
A) about 24 months
B) about 36 months
C) about 48 months
D) about 60 months
Page 12
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Chapter 10: Marketing Challenges for Entrepreneurial Ventures
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77 Verified Questions
77 Flashcards
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Sample Questions
Q1) Identify and describe one shortcoming of a sales-driven marketing philosophy?
Q2) The purpose of marketing research is __________.
A) to gain customers
B) to identify customer
C) to fulfill customer needs
D) to develop new products
Q3) Marketing planning is the process of determining a clear, comprehensive approach to the creation of customers.
A)True
B)False
Q4) Market segmentation is
A) the process of categorizing products into different segments
B) the process of identifying a specific set of characteristics that differentiate one group of consumers from the rest
C) the process of segmenting the sales force
D) heavily psychographic in nature
Q5) It is usually more expensive to gather secondary data than primary data.
A)True
B)False
Q6) Explain the new marketing concept?
Page 13
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Page 14
Chapter 11: Financial Preparation for Entrepreneurial Ventures
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78 Verified Questions
78 Flashcards
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Sample Questions
Q1) Pro forma statements show the firm's present financial position.
A)True
B)False
Q2) Financial information is important to entrepreneurs because:
A) it pulls together all the information presented in other segments of the business.
B) it quantifies all the assumptions concerning business operations.
C) it answers all questions about the business and the entrepreneur.
D) a and b are both correct.
Q3) The set of assumptions on which financial projections are based have little meaning.
A)True
B)False
Q4) After the operating budget has been prepared, an entrepreneur can proceed to the next phase of the budget process, the cash flow budget.
A)True
B)False
Q5) List the elements of a capital budget and define its main objective.
Q6) Define break-even analysis and identify some useful methods for finding the break-even point.
Page 15
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Chapter 12: Developing an Effective Business Plan
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Sample Questions
Q1) Because of the competition for funding, an entrepreneur's business plan needs to capture the reader's interest right away by stating the uniqueness of the venture.
A)True
B)False
Q2) The entrepreneur should expect to encounter a friendly and supportive audience when presenting the business plan to potential financial sources.
A)True
B)False
Q3) In some professional areas, the business plan is referred to as
A) a proposal for economic development.
B) an investment prospectus.
C) a strategic development project.
D) a and b only.
Q4) An indicator of the planning pitfall of "failure to anticipate roadblocks" is A) recognition of future problems.
B) making no admission of possible flaws in the plan.
C) having a contingency or alternative plan.
D) pursuing a good work force.
Q5) How does a business plan benefit the entrepreneur?
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Chapter 13: Strategic Entrepreneurial Growth
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Sample Questions
Q1) New ventures rarely exhibit a typical life cycle.
A)True
B)False
Q2) Most entrepreneurs are unfamiliar with planning information sources.
A)True
B)False
Q3) Which is not perceived as a difficulty in long-range planning?
A) arranging vacation time
B) inadequately defined objectives
C) poor planning climate
D) inexperienced managers
Q4) In principle, incumbents and entrepreneurs face the same challenges in finding new strategic positions. In practice, incumbents often have an edge.
A)True
B)False
Q5) The "best" strategic plan will be influenced by the abilities of the entrepreneur, the complexity of the venture, and the nature of the industry.
A)True
B)False
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Chapter 14: Valuation of Entrepreneurial Ventures
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Sample Questions
Q1) Which of the following methods of valuation was developed by the U.S. Treasury to determine a firm's intangible assets?
A) market value
B) replacement value
C) excess earnings
D) multiple of earnings
Q2) Specific factors of a venture being offered for sale that should be examined include
A) age, trends, and future.
B) profits, sales, and operating ratios.
C) employees, suppliers, and competitors.
D) profits, price, product.
Q3) A drawback to the price/earnings ratio method is that
A) the stock of a private company is publicly traded.
B) the stated net income of a private company may not truly reflect its actual earning power.
C) it is relatively easy to find a truly comparable publicly held company, even in the same industry.
D) it distorts profits earned.
Q4) Explain the purpose of a letter of intent.
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Chapter 15: Harvesting the Entrepreneurial Venture
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Sample Questions
Q1) Only ten percent of all privately held enterprises make it to a third generation.
A)True
B)False
Q2) Research on family firms demonstrates which of the following facts?
A) only 16 percent make it to a third generation
B) many family firms cease to exist after one month
C) only nine out of ten make it to a second generation
D) only 3 percent make it to the next generation
Q3) An entrepreneurial successor is someone who
A) is ingenious, creative, and driven
B) is loyal
C) has a profit orientation
D) has an administrative orientation
Q4) Which of the following is not a contextual aspect to be considered in an effective succession plan?
A) technology
B) time
C) environmental factors
D) type of venture
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