Chapter 01 The Global Entrepreneurial Revolution for a Flatter World Answer Key
True / False Questions
1.
According to Thomas Friedman, his book titled "The World is Flat" refers to the convergence
(p. 05) of technology and world events that are playing a role in bringing about significant changes in
traditional value chains. TRUE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
2.
Gearing entrepreneurs for competitiveness is likely to hinder the process of entrepreneurial
(p. 05) revolution.
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
3.
Entrepreneurship training works well in schools of business and engineering, but it has not
(p. 05) proven to be useful in fields such as architecture, medicine, and life sciences.
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
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4.
Entrepreneurship educators believe that expertise, wisdom, and knowledge are housed solely
(p. 06) in the faculty brain or in the library.
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
5.
The best entrepreneurship faculties are generally able to determine in advance who among
(p. 06) their incoming students will be the most effective entrepreneurs.
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
6.
David Birch, an MIT researcher, found that new and growing smaller firms had little effect on
(p. 07) the economy as a whole.
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
7.
According to the U.S. Small Business Administration's Office of Advocacy, small firms
(p. 08) accounted for all of the net new jobs in 2010.
TRUE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
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8.
A 2010 report by The Guardian Life Small Business Research Institute indicated that women-
(p. 08) owned businesses have been steadily decreasing over the past few decades.
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
9.
While various surveys of high school seniors indicate a strong interest in entrepreneurship, a
(p. 08) 2004 Gallup Poll showed that a large percentage of American parents would prefer that their
children pursue a less risky career. FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
10.
According to a study conducted in 2006, the self-employed report the lowest levels of personal
(p. 09) satisfaction, challenge, pride, and remuneration.
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
11.
Research in the 1980s and 1990s found that since World War II, small entrepreneurial firms
(p. 11) have been responsible for half of all innovation and a large percentage of all radical innovation
in the United States. TRUE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
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12.
Studies indicate that smaller firms generate twice as many innovations per research and
(p. 11- development (R&D) dollar spent as the established multinationals. 12)
TRUE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
13.
Value creation is a linear process as it requires a short-term perspective.
(p. 14)
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
14.
Entrepreneurship will result in equal incomes among the masses.
(p. 15)
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
15.
When the entrepreneurial process will take over, it will result in economic expansion and
(p. 15) accompanying social mobility.
TRUE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
Multiple Choice Questions
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16.
Rick, an entrepreneur, is in the process of selecting a manager for his new venture. To
(p. 02) successfully run the venture, who is he most likely to select?
A. Fiona, who prefers minimal investment in human resources B. Saeed, who complements the needs of the venture C. Garcia, who views change and ambiguity as detrimental for the venture D. Maria, who has a different vision for the venture Accessibility: Keyboard Navigation Blooms: Apply Level of Difficulty: 3 Hard
17.
Which of the following is a critical factor in enhancing entrepreneurship?
(p. 05)
A. Restricting entrepreneurship at the regional level B. Discouraging entrepreneurs from expressing competitiveness C. Reducing restrictions that block the flow of finance D. Removing programs based on "learning by doing" Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
18.
Which of the following is an entrepreneurial transformation that is changing the world?
(p. 05)
A. Entrepreneurship is now being discouraged in corporate America. B. Entrepreneurship topics and related issues are being removed from the curricula of business schools as they are self-taught. C. Entrepreneurship is becoming a tool to create social and economic equalities. D. Entrepreneurship is becoming a dominant management model for running nonprofit businesses. Accessibility: Keyboard Navigation Blooms: Understand Level of Difficulty: 2 Medium
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19.
What is the characteristic of entrepreneurship educators whose views and attitudes toward
(p. 06) learning differ radically from traditional academic approaches?
A. They are faculty centric. B. They do not prefer a work-in-progress philosophy of teaching. C. They do believe that expertise, wisdom, and knowledge are housed solely in the faculty. D. They are likely to see their role as mentors, coaches, and advocates for students. Accessibility: Keyboard Navigation Blooms: Understand Level of Difficulty: 2 Medium
20.
What is the difference between entrepreneurial educators and traditional academicians?
(p. 06)
A. Entrepreneurial educators are faculty centric, whereas traditional academicians are student centric. B. Entrepreneurial educators follow a rigid training module, whereas traditional academicians follow a more hands-on philosophy. C. Entrepreneurial educators treat the learning process as solely occurring in the classroom, whereas traditional academicians treat it as more of an apprenticeship. D. Entrepreneurial educators are opportunity centric, whereas traditional academicians are faculty centric. Accessibility: Keyboard Navigation Blooms: Understand Level of Difficulty: 2 Medium
21.
Which of the following is true of new venture creation?
(p. 08)
A. It is process oriented and not result oriented. B. It gives importance to one's nationality. C. It creates economic and social mobility. D. It reduces competitiveness. Accessibility: Keyboard Navigation Blooms: Understand 1-6 Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
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Level of Difficulty: 2 Medium
22.
At the heart of the entrepreneurial process is a(n):
(p. 11)
A. rigid organizational structure. B. resistance to ambiguity. C. innovative spirit. D. resistance to change. Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
23.
Who among the following is most likely to be called a philanthropist?
(p. 13)
A. Lydia, an entrepreneur, who acquires a foreign company B. Ahmed, an entrepreneur, who exercises monopoly in the highly profitable oil and natural gas sector C. Zainab, an entrepreneur, who funds the construction of a public school in her locality D. Eric, an entrepreneur, who sells his innovation in the aviation industry Accessibility: Keyboard Navigation Blooms: Apply Level of Difficulty: 3 Hard
24.
What is true of the majority of America's self-made entrepreneurs?
(p. 14)
A. They accumulated their wealth through luck. B. They are invisible to most Americans. C. They fit the media stereotype. D. They prefer social status to financial independence. Accessibility: Keyboard Navigation Blooms: Understand Level of Difficulty: 2 Medium
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25.
Which of the following is a characteristic of private equity creation?
(p. 14)
A. It is a linear process. B. It requires a long-term perspective. C. It hinders entrepreneurship. D. It targets quick returns on investments made over a short period of time. Accessibility: Keyboard Navigation Blooms: Understand Level of Difficulty: 2 Medium
Fill in the Blank Questions
26.
_____ is becoming a dominant management model for running nonprofit businesses and in the
(p. 05) emerging field of social ventures.
Entrepreneurship Blooms: Remember Level of Difficulty: 1 Easy
27.
_____ entrepreneurship means new venture creation.
(p. 08)
Classical Blooms: Remember Level of Difficulty: 1 Easy
28.
_____ showed the highest rate of increase of any minority group in owning businesses
(p. 08) according to the U.S. Census Bureau in 2007.
African Americans/Blacks Blooms: Remember Level of Difficulty: 1 Easy
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29.
When successful entrepreneurs get involved in the nonprofit sector directly by offering
(p. 13- strategic assistance, like long-term planning and leveraging relationships to identify additional 14)
resources and facilitate partnerships, it is referred to as _____ philanthropy. high-engagement
Blooms: Remember Level of Difficulty: 1 Easy
Short Answer Questions
30.
What is the impact of small firms in driving innovation in the United States?
(p. 1112)
The U.S. Department of Commerce found that since World War II, small entrepreneurial firms have been responsible for half of all innovation and 95 percent of all radical innovation in the United States. Other studies showed that research and development at smaller entrepreneurial firms were more productive and robust than at large firms; smaller firms generated twice as many innovations per R&D dollar spent as the giants, twice as many innovations per R&D scientist as the giants, and 24 times as many innovations per R&D dollar versus those large firms with more than 10,000 employees.
Blooms: Remember Level of Difficulty: 1 Easy
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31.
Briefly discuss the role of angel investors in the creation of new ventures.
(p. 13)
The angel investor market in 2010, following a considerable contraction in investment dollars in 2008 and 2009, exhibited a rise in investment dollars and in the number of investments. Similar to the venture capitalists, these angels bring far more than money to the entrepreneurial process. As successful entrepreneurs themselves, they bring experience, networks, wisdom, and maturity to the companies they fund. As directors and advisors, they function as coaches, confidants, mentors, and cheerleaders.
Blooms: Remember Level of Difficulty: 1 Easy
32.
Briefly discuss the role of successful American entrepreneurs as philanthropists.
(p. 1314)
A lesser known and largely ignored role of American entrepreneurs is that of philanthropists and creative community leaders. A majority of new buildings, classrooms, athletic facilities, and universities have been funded by an entrepreneur who wanted to give back. When a successful entrepreneur gets involved in the nonprofit sector, the engagement involves strategic business skills like long-term planning, board and executive recruitment, coaching, and leveraging relationships. These high-engagement philanthropists have a stronger focus and deeper investments in a smaller, more select number of investment partners, and a healthy ambition for the long-term reach of their efforts.
Blooms: Remember Level of Difficulty: 1 Easy
Essay Questions
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33.
Explain the four entrepreneurial transformations that are changing the world.
(p. 05)
Evidence and trends point to at least four entrepreneurial transformations that profoundly impact how the world lives, works, learns, and enjoys leisure. They are as follows: 1. Entrepreneurship is the new management paradigm: Entrepreneurial thinking and reasoning—so common in dynamic, higher-potential, and robust new and emerging firms—are now becoming infused and embedded into the strategies and practices of corporate America. 2. Entrepreneurship has spawned a new education paradigm for learning and teaching. 3. Entrepreneurship is becoming a dominant management model for running nonprofit businesses and in the emerging field of social ventures. 4. Entrepreneurship is rapidly transcending business schools: Engineering, life sciences, architecture, medicine, music, liberal arts, and K-12 are new academic grounds that are exploring and embracing entrepreneurship in their curricula.
Blooms: Understand Level of Difficulty: 2 Medium
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34.
How do entrepreneurial faculties drive the rapid explosion of entrepreneurship?
(p. 0607)
The energizing process for faculty and students alike is also driving the rapid explosion of entrepreneurship education worldwide. First, the field seems to attract, by its substance and nature, highly entrepreneurial people. Historically, entrepreneurial thinkers and doers have been few and far between in the vast majority of schools in the United States and abroad. These creative, can-do, resilient, and passionate people bring their entrepreneurial ways of thinking, acting, doing, and building to their courses, their research, and their institutions. They are the change agents—the movers and shakers. Second, their entrepreneurial bent brings a new mind-set to universities and schools: They think and act like owners. They are creative, courageous, and determined to make it work and happen; they build teams, practice what they preach, are institution builders, and do not let myopic allegiance to their disciplines impede becoming better educators. Students, deans, and colleagues can be energized by the leadingby-example pace they establish. Third, entrepreneurship faculties constantly think in terms of opportunity. Entrepreneurial faculty realize that money follows superior teams and superior opportunities, so they create them. They find ways to innovate, raise money, and implement curricula in resource-strapped universities. They match innovative ideas with wealthy entrepreneurs and their foundations to raise money and launch programs. Fourth, they create powerful strategic alliances with others—colleagues, alumni, and entrepreneurs by practicing the teamwork principles of entrepreneurship they teach. There is something exciting and compelling about being around highly intelligent and creative entrepreneurs as the centerpiece of your subject matter. They invariably inspire other faculty and students as well.
Blooms: Understand Level of Difficulty: 2 Medium
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35.
Describe a typical American entrepreneur.
(p. 14)
American entrepreneurs typically accumulated their wealth through hard work, self-discipline, planning, and frugality—all very entrepreneurial virtues. Two-thirds of them still working are self-employed and are self-made. The vast majority (80 percent) are ordinary people who have accumulated their wealth in one generation, live below their means, and prefer financial independence to social status. Majority of them are invisible to most Americans and do not fit the media stereotype. They get rich slowly, with the average millionaire being 57 years old. Their businesses are ordinary ones they started and built like ambulance services, citrus farming, cafeteria services, consulting services, janitorial services, job training schools, meat processors, mobile home parks, pest controllers, newsletter publishers, rice farmers, and sandblasting contractors.
Blooms: Understand Level of Difficulty: 2 Medium
Chapter 02 The Entrepreneurial Mind: Crafting a Personal Entrepreneurial Strategy Answer Key Is At the End of Each Chapter True / False Questions
1. The psychological motivation of entrepreneurial behavior states that the need for achievement is the need to build a relationship with others. True
False
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2. In the context of psychological motivation of entrepreneurial behavior, the need for power is the need to influence others to achieve a goal. True
False
3. In the context of entrepreneurial behavior, the need for affiliation is the need to excel. True
False
4. Entrepreneurs motivated purely by monetary reward typically build companies of substantial value. True
False
5. All successful business people share characteristics of raw energy and intelligence. True
False
6. The third volume of the Praeger Perspectives examines people and refers to a wide and diverse range of contextual factors that influence the entrepreneur and the entrepreneurial process. True
False
7. Successful entrepreneurs possess a well-developed capacity to exert influence without formal power. True
False
8. Entrepreneurs are self-starters who are internally driven by a strong desire to compete and attain challenging goals. True
False
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9. Research has shown that an entrepreneur is more driven by the conservation of resources, whereas a manager is more opportunity-driven. True
False
10. Studies show a strong connection between the presence of role models and the emergence of entrepreneurs. True
False
11. Entrepreneurs are their own bosses and completely independent. True
False
12. Successful entrepreneurs seek power and control over others. True
False
Multiple Choice Questions
13. Which of the following is defined as the need for measurable personal accomplishment?
A. The need for achievement B. The need for power C. The need for affiliation D. The need for attachment
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14. Which of the following is the least characteristic motivational need of successful entrepreneurs?
A. Achievement B. Control C. Power D. Affiliation 15. Which of the following volumes of the Praeger Perspectives proceeds through the life cycle of a new venture startup by tackling several key steps in the course of action?
A. People B. Process C. Place D. Plan 16. Which of the following is not an entrepreneurial attribute?
A. Being a calculated risk taker B. Being a perfectionist C. Being obsessed with value creation D. Being intensely curious in the face of risk 17. In the context of creativity, self-reliance, and adaptability, which of the following attitudes of an entrepreneur is desirable?
A. Skepticism about conflicts and failure B. Ability to be a lone wolf C. Restlessness with the status quo D. High need for status and power
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18. In the troika of the foundation of a successful new venture, which of the following is an external environmental influence?
A. Value creation B. Ethical behavior C. Focus D. Adaptability 19. Successful entrepreneurs consistently focus on:
A. seizing a market-based opportunity. B. obtaining resources. C. networking. D. making money. 20. When compared to an entrepreneur, a manager is more:
A. resource-driven. B. opportunity-driven. C. creative. D. innovative. 21. According to research, which of the following statements about entrepreneurs is false?
A. Many successful entrepreneurs are well educated. B. Most successful entrepreneurs start companies in their early 20s. C. Most successful entrepreneurs follow a pattern of apprenticeship. D. Family firms spawn entrepreneurs.
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22. According to research studies on the career paths of entrepreneurs and the self-employed, which of the following is the central factor for a successful venture creation?
A. Networking B. The ability to marshal resources C. Experience and know-how D. The ability to attract and motivate an effective team 23. According to an old maxim, how long will venture capitalists work with a startup before declaring the company a "lemon"?
A. Up to a year B. About two and a half years C. At least three years D. Three to five years 24. Which of the following is the most important component of opportunity recognition?
A. Experimenting with new ideas B. Exhibiting low tolerance toward change C. Being risk aversive D. Being a perfectionist 25. Which of the following statements demystifies the myth that entrepreneurs are gamblers?
A. Entrepreneurs consider an idea and an opportunity as the same. B. Successful entrepreneurs try to influence the odds, often by getting others to share the risk. C. Successful entrepreneurs are completely independent and their own bosses. D. Entrepreneurs are driven by instant gratification through high salaries and perks.
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26. Which of the following is a reality and not a persistent myth about entrepreneurs?
A. Entrepreneurs are born, not made. B. Entrepreneurs are gamblers. C. Solo entrepreneurs limit their own potential for growth. D. Entrepreneurs should be young, energetic, and in their 20s. 27. Which of the following is a myth about successful entrepreneurs?
A. They are driven by the need for achievement. B. They are driven by the need to control others. C. They have the ability to exert influence. D. They have the ability to be patient even in adverse situations. 28. According to venture investors, what is the realistic time frame for growing a high potential business to the point where a capital gain can be realized?
A. 1-3 years B. 2-5 years C. 5-7 years D. 7-8 years 29. Successful entrepreneurs are driven by:
A. the quest for power for its own sake. B. a personal need for authority expressed by control over others. C. the quest for achievement and results. D. a need to seek money as an end in itself.
Fill in the Blank Questions
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30. The need for _____ is the need to excel and the need for measurable personal accomplishment. ________________________________________ 31. The need to build a relationship with others is known as the need for ___. ________________________________________ 32. The first volume of the Praeger Perspectives deals with _____ and takes a broad view of entrepreneurship as a form of human action, pulling together the current research with respect to cognitive, economic, social, and institutional factors that influence entrepreneurial behavior. ________________________________________ 33. An entrepreneur who displays a high energy level and a sense of urgency is known as a ___. ________________________________________ 34. Based on the entrepreneurial leadership paradigm, when the competencies of others are sought and used, it is referred to as ___. ________________________________________ 35. Entrepreneurs who are internally driven by a strong desire to compete and attain challenging goals are typically known as ___. ________________________________________ 36. Although the skills of a manager and an entrepreneur overlap in the area of solid management skills, a manager is more driven by the conservation of resources, while the entrepreneur is more ___. ________________________________________
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37. Numerous studies show a strong connection between the presence of _____ and the emergence of successful entrepreneurs. ________________________________________ 38. Successful entrepreneurs are not gamblers; they take ___. ________________________________________ 39. Most successful entrepreneurs have had a _____ to help them achieve their dreams and goals, both implicitly and explicitly. ________________________________________
Short Answer Questions
40. Write a short note on the Praeger Perspectives.
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41. In the context of the seven dominant themes of desirable and acquirable attitudes and behavior of entrepreneurs, briefly describe the role of creativity, self-reliance, and adaptability.
Essay Questions
42. Discuss any two myths and realities about entrepreneurs.
43. Describe at least three important aspects of courage in entrepreneurship.
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Chapter 02 The Entrepreneurial Mind: Crafting a Personal Entrepreneurial Strategy Answer Key
True / False Questions
1.
The psychological motivation of entrepreneurial behavior states that the need for achievement
(p. 29) is the need to build a relationship with others.
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
2.
In the context of psychological motivation of entrepreneurial behavior, the need for power is
(p. 29) the need to influence others to achieve a goal.
TRUE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
3.
In the context of entrepreneurial behavior, the need for affiliation is the need to excel.
(p. 29)
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
4.
Entrepreneurs motivated purely by monetary reward typically build companies of substantial
(p. 29) value.
FALSE Accessibility: Keyboard Navigation 1-23 Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
SOURCE: Browsegrades.net
Blooms: Remember Level of Difficulty: 1 Easy
5.
All successful business people share characteristics of raw energy and intelligence.
(p. 30)
TRUE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
6.
The third volume of the Praeger Perspectives examines people and refers to a wide and
(p. 31) diverse range of contextual factors that influence the entrepreneur and the entrepreneurial
process. FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
7.
Successful entrepreneurs possess a well-developed capacity to exert influence without formal
(p. 33) power.
TRUE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
8.
Entrepreneurs are self-starters who are internally driven by a strong desire to compete and
(p. 34) attain challenging goals.
TRUE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
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9.
Research has shown that an entrepreneur is more driven by the conservation of resources,
(p. 35) whereas a manager is more opportunity-driven.
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
10.
Studies show a strong connection between the presence of role models and the emergence of
(p. 36) entrepreneurs.
TRUE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
11.
Entrepreneurs are their own bosses and completely independent.
(p. 37)
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
12.
Successful entrepreneurs seek power and control over others.
(p. 38)
FALSE Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
Multiple Choice Questions
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13.
Which of the following is defined as the need for measurable personal accomplishment?
(p. 29)
A. The need for achievement B. The need for power C. The need for affiliation D. The need for attachment Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
14.
Which of the following is the least characteristic motivational need of successful
(p. 30) entrepreneurs?
A. Achievement B. Control C. Power D. Affiliation Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
15.
Which of the following volumes of the Praeger Perspectives proceeds through the life cycle of
(p. 30) a new venture startup by tackling several key steps in the course of action?
A. People B. Process C. Place D. Plan Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
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16.
Which of the following is not an entrepreneurial attribute?
(p. 31)
A. Being a calculated risk taker B. Being a perfectionist C. Being obsessed with value creation D. Being intensely curious in the face of risk Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
17.
In the context of creativity, self-reliance, and adaptability, which of the following attitudes of an
(p. 31) entrepreneur is desirable?
A. Skepticism about conflicts and failure B. Ability to be a lone wolf C. Restlessness with the status quo D. High need for status and power Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
18.
In the troika of the foundation of a successful new venture, which of the following is an
(p. 33) external environmental influence?
A. Value creation B. Ethical behavior C. Focus D. Adaptability Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
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19.
Successful entrepreneurs consistently focus on:
(p. 33)
A. seizing a market-based opportunity. B. obtaining resources. C. networking. D. making money. Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
20.
When compared to an entrepreneur, a manager is more:
(p. 35)
A. resource-driven. B. opportunity-driven. C. creative. D. innovative. Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
21.
According to research, which of the following statements about entrepreneurs is false?
(p. 36)
A. Many successful entrepreneurs are well educated. B. Most successful entrepreneurs start companies in their early 20s. C. Most successful entrepreneurs follow a pattern of apprenticeship. D. Family firms spawn entrepreneurs. Accessibility: Keyboard Navigation Blooms: Understand Level of Difficulty: 2 Medium
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22.
According to research studies on the career paths of entrepreneurs and the self-employed,
(p. 36) which of the following is the central factor for a successful venture creation?
A. Networking B. The ability to marshal resources C. Experience and know-how D. The ability to attract and motivate an effective team Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
23.
According to an old maxim, how long will venture capitalists work with a startup before
(p. 38) declaring the company a "lemon"?
A. Up to a year B. About two and a half years C. At least three years D. Three to five years Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 2 Medium
24.
Which of the following is the most important component of opportunity recognition?
(p. 36)
A. Experimenting with new ideas B. Exhibiting low tolerance toward change C. Being risk aversive D. Being a perfectionist Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
1-29 Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
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25.
Which of the following statements demystifies the myth that entrepreneurs are gamblers?
(p. 37)
A. Entrepreneurs consider an idea and an opportunity as the same. B. Successful entrepreneurs try to influence the odds, often by getting others to share the risk. C. Successful entrepreneurs are completely independent and their own bosses. D. Entrepreneurs are driven by instant gratification through high salaries and perks. Accessibility: Keyboard Navigation Blooms: Understand Level of Difficulty: 2 Medium
26.
Which of the following is a reality and not a persistent myth about entrepreneurs?
(p. 37)
A. Entrepreneurs are born, not made. B. Entrepreneurs are gamblers. C. Solo entrepreneurs limit their own potential for growth. D. Entrepreneurs should be young, energetic, and in their 20s. Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
27.
Which of the following is a myth about successful entrepreneurs?
(p. 38)
A. They are driven by the need for achievement. B. They are driven by the need to control others. C. They have the ability to exert influence. D. They have the ability to be patient even in adverse situations. Accessibility: Keyboard Navigation Blooms: Understand Level of Difficulty: 2 Medium
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28.
According to venture investors, what is the realistic time frame for growing a high potential
(p. 38) business to the point where a capital gain can be realized?
A. 1-3 years B. 2-5 years C. 5-7 years D. 7-8 years Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
29.
Successful entrepreneurs are driven by:
(p. 38)
A. the quest for power for its own sake. B. a personal need for authority expressed by control over others. C. the quest for achievement and results. D. a need to seek money as an end in itself. Accessibility: Keyboard Navigation Blooms: Remember Level of Difficulty: 1 Easy
Fill in the Blank Questions
30.
The need for _____ is the need to excel and the need for measurable personal
(p. 29) accomplishment.
achievement Blooms: Remember Level of Difficulty: 1 Easy
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31.
The need to build a relationship with others is known as the need for ___.
(p. 29)
affiliation Blooms: Remember Level of Difficulty: 1 Easy
32.
The first volume of the Praeger Perspectives deals with _____ and takes a broad view of
(p. 30) entrepreneurship as a form of human action, pulling together the current research with respect
to cognitive, economic, social, and institutional factors that influence entrepreneurial behavior. people Blooms: Remember Level of Difficulty: 1 Easy
33.
An entrepreneur who displays a high energy level and a sense of urgency is known as a ___.
(p. 34)
pacemaker Blooms: Remember Level of Difficulty: 1 Easy
34.
Based on the entrepreneurial leadership paradigm, when the competencies of others are
(p. 34) sought and used, it is referred to as ___.
mentoring Blooms: Remember Level of Difficulty: 1 Easy
35.
Entrepreneurs who are internally driven by a strong desire to compete and attain challenging
(p. 34) goals are typically known as ___.
self-starters Blooms: Remember Level of Difficulty: 1 Easy
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36.
Although the skills of a manager and an entrepreneur overlap in the area of solid management
(p. 35) skills, a manager is more driven by the conservation of resources, while the entrepreneur is
more ___. opportunity-driven Blooms: Remember Level of Difficulty: 1 Easy
37.
Numerous studies show a strong connection between the presence of _____ and the
(p. 36) emergence of successful entrepreneurs.
role models Blooms: Remember Level of Difficulty: 1 Easy
38.
Successful entrepreneurs are not gamblers; they take ___.
(p. 37)
calculated risks Blooms: Remember Level of Difficulty: 1 Easy
39.
Most successful entrepreneurs have had a _____ to help them achieve their dreams and
(p. 39) goals, both implicitly and explicitly.
personal strategy Blooms: Remember Level of Difficulty: 1 Easy
Short Answer Questions
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40.
Write a short note on the Praeger Perspectives.
(p. 3031)
The Praeger Perspectives is a three volume series from 2007 that researched entrepreneurship from three perspectives: people, process, and place. This study brings together insights into the field of entrepreneurship by some of the leading scholars in the world. The first volume, people, takes a broad view of entrepreneurship as a form of human action, pulling together the current research with respect to cognitive, economic, social, and institutional factors that influence entrepreneurial behavior. The second volume, process, proceeds through the life cycle of a new venture startup by tackling several key steps in the process: idea, opportunity, team building, resource acquisition, growth management, and entering global markets. The third volume in the series examines place, which refers to a wide and diverse range of contextual factors that influence the entrepreneur and the entrepreneurial process.
Blooms: Remember Level of Difficulty: 1 Easy
41.
In the context of the seven dominant themes of desirable and acquirable attitudes and
(p. 34) behavior of entrepreneurs, briefly describe the role of creativity, self-reliance, and adaptability.
High levels of uncertainty and rapid change characterizing new ventures require organizations that can respond quickly. The most successful entrepreneurial teams have the ability to focus on a goal with outstanding execution, while being flexible enough to shift when the market and circumstances require it. At the same time, entrepreneurs are not afraid of failing; rather, they are more intent on succeeding.
Blooms: Remember Level of Difficulty: 1 Easy
Essay Questions
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42.
Discuss any two myths and realities about entrepreneurs.
(p. 37)
Myth 1—Entrepreneurs are born, not made. Reality—While entrepreneurs are born with certain native intelligence, a flair for creating, and energy, these talents by themselves are like unmolded clay or an unpainted canvas. The making of an entrepreneur occurs by accumulating the relevant skills, know-how, experiences, and contacts over a period of years and includes large doses of self-development. The creative capacity to envision and then pursue an opportunity is a direct descendant of at least 10 or more years of experience that lead to pattern recognition. Myth 2—Anyone can start a business. Reality—Entrepreneurs who recognize the difference between an idea and an opportunity, and who think big enough, start businesses that have a better chance of succeeding. Luck, to the extent it is involved, requires good preparation. The easiest part is starting. What is hardest is surviving, sustaining, and building a venture so its founders can realize a harvest. Perhaps only one in 10 to 20 new businesses that survive five years or more results in a capital gain for the founders.
Blooms: Understand Level of Difficulty: 2 Medium
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43.
Describe at least three important aspects of courage in entrepreneurship.
(p. 33)
Courage has at least three important aspects in entrepreneurship. The first aspect is moral strength and principles. This refers to the character and the personal integrity to know right from wrong, and the will and commitment to act accordingly. The second aspect of courage is being a fearless experimenter. Fearless experimentation suggests restlessness with convention and a rejection of the status quo. This relentless experimentation is enhanced by a third aspect of courage, which is a lack of fear of failing at the experiment and a lack of fear of conflicts that may arise. In other words, there is a mental toughness that is quite impervious to fears but is not ignorant or oblivious to possible consequences.
Blooms: Understand Level of Difficulty: 2 Medium
Chapter 03 The Entrepreneurial Process
True / False Questions
1. Entrepreneurship results in the creation, enhancement, realization, and renewal of value, not just for owners, but for all participants and stakeholders. True
False
2. The classic expression of entrepreneurship is the raw start-up company, an innovative idea that develops into a high-growth company. True
False
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3. Too much control and an obsession with orderliness are prerequisites to a successful entrepreneurial approach. True
False
4. Entrepreneurship requires inflexible strategies and tactics that are not nimble. True
False
5. Building long-term equity requires large, continuous reinvestment in people, products, and services in advance of revenues. True
False
6. One of the biggest strategic mistakes aspiring entrepreneurs make is that they think too small. True
False
7. Small, simple businesses that are more affordable, more manageable, and less demanding are more profitable than high-potential ventures. True
False
8. While government data, research, and business mortality statisticians may not agree on the precise failure and survival figures for new businesses, they do agree that moderate success is the rule, not the exception with new ventures. True
False
9. Knowing the difference between a good idea and a real opportunity is vital for would-be entrepreneurs. True
False
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10. In case of competition, the entrepreneurial task is to find a way to direct the arena of competition toward the areas where a new venture is at a competitive disadvantage. True
False
11. The threshold concept proposes that the odds of success change as a venture reaches a critical mass of over $8 million in sales and 50 employees. True
False
12. Successful entrepreneurs avoid creating their own investment pools, and they do not compete directly with venture capitalists for deals. True
False
13. Like venture capitalists, private investors are constrained by having to invest a lot of money in a relatively short period. True
False
14. Private investors are funding more and more early-stage businesses, enabling risk mitigation before larger, institutional venture funds invest. True
False
15. There is often a direct correlation between creativity and innovation and the level of resources available at the start of a venture. True
False
16. "Durability" refers to the market advantage a company can enjoy by developing proprietary barriers to entry. True
False
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