Questions and Answers
What method is used for determining the value of a business by using the price/earnings ratios of similar businesses?
Which pair of terms correctly describes the process of thinking new things and doing new things?
What term refers to a business that employs less than 100 people?
Which of the following is NOT a benefit of owning a small business?
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Which form of business ownership is designed for a business owned and managed by one individual?
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What does 'Intellectual capital' refer to in a business context?
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In a partnership, the co-owners legally share a business’s assets, liabilities, and profits according to what?
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What does UPA stand for in the context of business?
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Which type of competitors offer some of the same products and services?
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What do you call a corporation that conducts business in the state where it is incorporated?
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What are the key methods for preparing an advertising budget?
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What factors play a role in determining the right price for a product or service?
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What is the purpose of promotion in marketing?
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What differentiates a small business from its competitors and gives it a unique position in the market?
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Which type of information is commonly used in data mining?
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What can be a disadvantage of buying an existing business?
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In franchising, what do semi-independent business owners receive in return for paying fees and royalties to a parent company?
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What can be an advantage of buying an existing business according to the text?
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What should a company consider when selecting advertising media?
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Which structure features elements of a partnership and a corporation?
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What is a natural part of the creative process?
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What areas should a business plan presentation cover?
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What is a distinction made only for federal income tax purposes?
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What is a road map an entrepreneur draws up to fulfill a company's mission?
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What is a potential drawback of owning a small business related to income?
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Which drawback of owning a small business is associated with the risk of losing all invested capital?
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What potential drawback involves the need for long hours and hard work in small business ownership?
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Which drawback is related to the lower quality of life until a small business becomes profitable?
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Which potential drawback of owning a small business involves always being under pressure to succeed?
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What potential drawback highlights the fact that small business owners are liable for all debts, losses, and lost capital if the business fails?
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Study Notes
Advantages and Disadvantages of Buying an Existing Business
- One advantage of buying an existing business is leveraging the experience of the previous owner
- A disadvantage of buying an existing business is paying for “ill will”
Types of Business Ownership
- Corporation: a corporation conducts business in the state in which it is incorporated
- Partnership: co-owners (partners) legally share a business’s assets, liabilities, and profits according to the terms of an established partnership agreement
- Joint Venture: semi-independent business owners pay fees and royalties to a parent company in return for the right to become identified with its trademark, to sell its products or services, and often to use its business format and system
- Sole Proprietorship: a business owned and managed by one individual
Marketing and Advertising
- The purpose of promotion in marketing is to inform consumers about a product or service and influence them to make a purchase
- Factors that determine the right price for a product or service include cost structure, market assessment, and desired image
- Methods for preparing an advertising budget include affordable, competitor matching, and percentage of sales
Entrepreneurship and Innovation
- Creativity refers to thinking new things, and innovation refers to doing new things
- Intellectual capital refers to the knowledge and information a company acquires and uses to create a competitive advantage in its market segment
- Failure is a natural part of the creative process
Business Planning
- A business plan is a road map an entrepreneur draws up of the actions necessary to fulfill a company's mission, goals, and objectives
- Areas that a business plan presentation should cover include the problem your product or service solves
Types of Franchising
- Franchising: a method of distributing products or services where a franchiser grants a franchisee the right to operate a business using the franchiser's business system and trademark
- Pure franchising (or comprehensive franchising or business format franchising): a franchisee gets the ability to use the brand name, products, and complete business system of the franchiser
Drawbacks of Owning a Small Business
- Uncertainty of income
- Risk of losing entire invested capital
- Long hours and hard work
- Lower quality of life until the business gets established
- High levels of stress
- Complete responsibility
- Discouragement
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Description
This quiz contains multiple choice questions and true/false statements related to entrepreneurship and partnership agreements, focusing on topics like co-ownership, business assets, liabilities, profits, and legal structures. Test your knowledge on concepts like Uniform Partnership Act.
