Entrepreneurship Test Flashcards
In a sole proprietorship, who has full control over business decisions?
The owner
In which type of business ownership is the owner personally liable for all business debts and obligations?
Sole proprietorship
How is a sole proprietorship taxed on business profits?
Taxed at the individual level
In a partnership, how do partners share ownership, responsibilities, and profits?
According to the partnership agreement
What are the three main types of partnerships?
General partnerships, limited partnerships, and limited liability partnerships
In which type of partnership do all partners have unlimited liability?
General partnerships
What type of partnership offers liability protection to all partners?
Limited liability partnerships
In a corporation, who elects a board of directors to oversee major decisions?
Shareholders
Which type of corporation can issue stock to raise capital?
C Corporations
What type of corporation passes through income to shareholders for tax purposes?
S Corporations
Which type of corporation allows an unlimited number of shareholders?
C Corporations
This type of business structure does not allow more than 100 shareholders.
S Corporation
What is a disadvantage of a corporation regarding double taxation?
Profits taxed at both corporate and individual levels
S Corps can avoid double taxation.
What is the significance of limited liability in business ownership?
Protects personal assets, encourages investment, facilitates risk management, promotes continuity and growth opportunities
What is the aim of an intensive distribution strategy?
To maximize market coverage and convenience for consumers
What is the purpose of selective distribution?
To sell a product through a limited number of carefully chosen retail outlets
What are the advantages of selective distribution?
Allows for better control over product presentation, ensures consistent brand image, targets specific consumer segments effectively
What does exclusive distribution involve?
Granting exclusive rights to one or a few retailers or distributors to sell a product within a specific geographic area or market segment
What are the advantages of exclusive distribution?
Ensures exclusivity and scarcity, enhances brand prestige and perception, fosters strong relationships with selected partners
What is the purpose of a Request for Proposal (RFP) document?
To solicit bids from potential suppliers or service providers for a specific project, product, or service
What does an RFP aim to define?
Project requirements, scope, objectives, specifications, and deliverables
What are examples of government regulations aimed at protecting consumers?
Product Safety Standards, Food and Drug Regulations, Consumer Financial Protection, Truth in Advertising, Consumer Privacy Protections, Consumer Rights and Redress, Environmental Protections
What is the concept of economies of scale?
Cost advantages achieved as businesses increase the scale of production or expand operations
What are examples of cultural considerations in international business?
Language preferences, communication styles, gift-giving practices, business meetings and negotiations, holidays and observances
Why is it important to assess workload and staffing needs in human resources management?
To avoid understaffing, prevent overstaffing, allocate resources effectively, identify skill gaps, and optimize productivity and efficiency
What are the types of capital resources in business operations?
Financial capital, Physical capital, Human capital, Intellectual capital
Can you provide examples of capital resources in business operations?
Examples include bank loans (financial capital), machinery and equipment (physical capital), employee skills (human capital), patents (intellectual capital)
What is the significance of understanding members in a channel for businesses?
Understanding members in a channel helps businesses effectively manage the distribution and delivery of products or services from manufacturer to consumer, optimizing supply chain operations.
Can you list some common types of torts in business law?
Negligence, Fraud, Defamation, Product Liability, Breach of Contract
What is the purpose of the ADKAR model in change management?
The ADKAR model guides individuals and organizations through the process of achieving successful change by addressing awareness, desire, knowledge, ability, and reinforcement.
How do investors contribute to business growth and development?
Investors provide capital, expertise, mentorship, and strategic support to startups and companies, facilitating growth, expansion, and innovation.
What are some ways entrepreneurs can bootstrap their businesses?
Ways include using personal savings, sweat equity, revenue reinvestment, bartering, crowdfunding, grants, and partnerships, among others.
What is the role of a trade journal in business?
A trade journal provides industry-specific news, analysis, and trends, offering valuable insights and information to businesses operating within that industry.
Can you explain the purpose of a sales invoice in business transactions?
A sales invoice documents the sale of goods or services, providing details such as product/service description, quantity, price, and terms of sale for both the seller and buyer.
How can businesses forecast sales to plan for future operations?
Businesses can forecast sales by analyzing historical data, conducting market research, analyzing the sales pipeline, trend analysis, and gathering customer feedback, among other methods.
What are some common methods of property protection for businesses?
Methods include trademarks, patents, copyrights, trade secrets, industrial design rights, non-compete agreements, contracts, domain name registration, and software licensing.
Angel Investors
These individuals provide capital for startups in exchange for ownership equity or convertible debt. They often offer mentorship and guidance to the entrepreneurs they invest in.
Venture Capitalists (VCs)
VCs are professional investors who invest funds provided by institutions or high-net-worth individuals. They invest in startups and early-stage companies in exchange for equity ownership, often focusing on high-growth potential businesses.
Marketing Mix
Product, price, promotion, place
Product mix strategies
Product line expansion
Product line pruning
Product line extension
Product line modernization
Product line diversification
Product line rationalization
Common-size financial statements
Common-size financial statements express each line item as a percentage of a base figure, typically total revenue (income statement) or total assets (balance sheet).
Income Statement
An income statement, also known as a profit and loss statement, is a financial statement that summarizes a company’s revenues, expenses, and profits or losses over a specific period, typically a quarter or a fiscal year.
Balance Sheet
A balance sheet is a financial statement that provides a snapshot of a company’s financial position at a specific point in time, usually the end of a reporting period such as a quarter or fiscal year.
Includes assets, liabilities, and owner’s equity.
Statement of stockholder’s equity
The statement of stockholders’ equity, also known as the statement of shareholders’ equity or statement of changes in equity, is a financial statement that shows the changes in the equity section of a company’s balance sheet over a specific period.
