Entrepreneurship

Test Review 2012

1

• Buildings, equipment, tools, and other goods needed to produce a product, or the money used to purchase these items.

Capital

2

• What does ROI stand for?

Return On Investment

1

• A market that only has one producer, and has no competition. A company that has a monopoly is able to charge higher prices because consumers have nowhere else to go.

Monopoly

1

• Buying goods from other countries to sell in your own country

Importing

2

• The process used to test a business concept.

Feasibility Analysis

1

• The money leftover after all the expenses of a business have been deducted from the income.

Profit

2

• Point at which supply equals demand, neither leaving a surplus or a shortage.

Equilibrium

1

• When demand is higher than supply. It allows businesses to increase prices.

Scarcity

2

• The quantity of goods or services that consumers are willing and able to buy

Demand

1

• Legal agreement to market a company’s products or services in a particular area.

Franchise

1

• The process of getting into and operating one’s own business.

Entrepreneurship

2

• Making goods in your own country and sending them to other countries

Exporting

1

• When several businesses strive for the same customer or market.

Competition

2

• Watchdog for consumers over products that may be hazardous.

Consumer Product Safety Commission

1

• Protects the rights of employees age, race, color or national origin, religion, gender or physical challenge.

Equal Employment Opportunity Commission

1

• Minimum wage and maximum working hours are identified. Children under 16 cannot work full-time except if employed by parents.

Fair Labors Standard Act

2

• Ensures safe and healthy working conditions for employees.

Occupational Safety & Health Act

2

• Requires manufacturers truthfully label products, showing all raw materials used in the production process.

Fair Packaging and Labeling Act

1

• The specific market segment where all of a business’s activities are directed.

Target Market

2

• Statistical data that describes a given market by criteria such as age, gender, and income.

Demographics

1

• Statistical data that describes a given market by criteria such as personality, opinions, and lifestyle.

Psychographics

2

• Study of the market based on where customers live by region, state, city, and/or area.

Geographic's

1

• Customers will purchase products or services from companies they know or have experience with. Customers have knowledge of and personal experiences with the actual goods or services.

Buying Characteristics

2

• Expresses specific goals for the company.

Mission Statement

2

• This Association helps assist Americans in starting a business.

Small Business Association (SBA)

1

• Businesses respond to scarcity in the marketplace by doing what?

Increasing Prices

2

• This Act makes it illegal for businesses to create monopolies.

Sherman Anti-Trust Act

1

• If you invested $20,000 and you want a 20% return on your investment, what would that amount be?

$4,000

2

• Provides legal rights to market a large chain & company’s products in a specific geographic area.

Franchise

1

• When new competitors enter a market and the supply of goods increases what happens to the price of that good?

Price Decreases

2

• Individuals who undertake the creation, organization and ownership of a business.

Entrepreneur

1

• Primary reason people start a business?

Profit Motive

2

• It is important that when business owners are participating in business overseas that they watch the:

Currency Exchange Rate

1

• Pricing that happens when consumers buy all products supplied leaving neither a surplus nor a shortage.

Equilibrium Pricing

2

• It is considered what when you let your friends sneak into the movie for free if you are working at the movie theater.

Unethical

1

• Consists of consumers commitment to repurchase or otherwise continue using the brand and can be demonstrated by repeated buying of a product.

Brand Loyalty

2

• Evaluating a competitors product selection, quality, promotional activities and pricing policies provides info about their?

Strengths and Weaknesses

1

• What a company must identify in order to sell goods or services.

Target Market

2

• Data already collected

Secondary Data

1

• Research collected for the first time and relates directly to the collector’s study.

Primary Data

2

• A group of people whose opinions are studied to determine the opinions/buying preferences of a larger population.

Focus Group

2

• 2 women of different ages, different income levels & different levels of education buy the same coffee. What is this an example of?

Niche Marketing

1

• Inventory used to keep storage space to a minimum and costs low.

Perpetual Inventory

2

• No matter what type of inventory system a company uses they should periodically conduct a ?

Physical Inventory count

1

• Picture of prospective customers

Customer Profile

1

• Cheapest way to advertise a school event

Flyers

2

• Advertising and Promotional activities are all considered what kind of expenses?

Operating Expenses

1

• 1st Step in Market Research

Identify Your Information Needs

2

• When people buy based on others’ opinions. What is this called?

Buying Motives

1

• Joe is a manufacturer who exports 90% of his products overseas. When considering a location for his new site he needs to consider:

Accessibility of distribution methods

2

• Tool used to show potential leaders your business idea

Business Plan

1

• This is the amount added to the cost of items to cover expenses and ensure a profit

Markup

1

• Government Agencies that assist entrepreneurs in starting their own businesses include all of the following except:

• A OSHA• B Chamber of Commerce• C State Governments• D SBA

A OSHA

2

• Expenses that change with each unit produced.

Variable Expenses

1

• Of the 5 C’s of credit, which one refers to a business owner’s reputation for fair and ethical practices?

Character

2

• What is 16% of $80,000?

$12,800

1

• Shows a company what they are worth at a given time.

Balance Sheet

2

• Jackie spent $130,000 on her goods and had net sales of $200,000 and expenses of $40,000. What is her Gross Profit?

$200,000 - $130,000 - $40,000 = $30,000 Gross Profit

1

• If you sell designer handbags at $300 and you want to give a customer a 20% discount how much would you take off the price?

$60

2

• Legal Entity that makes money for a reason other than the owners profit

Non- Profit Organization

1

• If you invest $20,000 and want a return of 25% what would that be?

$20,000 x .25 = $5,000

2

• Breaking down market into smaller groups

Market Segmentation

1

Marking up a product from $5 to $8 is what % markup?A. 40%B. 60%C. 106%D. 16%

60%

1

• You borrow $50,000 at 8% interest for 5 years. How much is your monthly payment?

$50,000 x .08 = $4,000 interest per year$4,000 x 5 years = $20,000$50,000 + $20,000 = $70,000 total to repay over 5 years5 years = 60 months$70,000 / 60 = $1,166.67 monthly payment

2

• If a company has more assets than liabilities what does it have?

Net Income

1

• The part of the marketing mix (4 Ps) that deals with getting the product to the consumer is:

Place

1

• All of the following give money to an entrepreneur BUT:

• A - Venture Capitalist• B - Personal Savings• C – Federal Reserve Bank• D – Family & Friends

C – Federal Reserve Bank

2

• Evaluating a competitors product selection, quality, promotional activities & pricing policies gives you information about their?A. Intent to sellB. Income StatementC. Strengths & WeaknessesD. Buying Characteristics

C. Strengths & Weaknesses

1

• Easiest form of business to create:• A. Limited Partnership• B. Corporation• C. Subchapter C• D. Sole Proprietorship

D. Sole Proprietorship

2

• If a company owes $100,000 on its building, what section of a balance sheet do you put that on?

• Liabilities Section

1

• What is a disadvantage of owning your own business?

You could lose your investment if the business fails.

2

• A Golf course and a Movie Theater compete for the same customers dollar. What kind of competition is this?

• Indirect Competition

1

• Entrepreneurs do not:

Collect taxes from the government

2

• Wholesale cost of shoes is $50. What would they cost if you marked them up 100%?

• $100

2

• If a business owner wants to protect their personal assets what kind of business ownership should they have?

• LLC (LIMITED LIABILITY COMPANY)

1

• Cabinet business selling to retailers should probably locate their business in a?

Industrial Park

2

• Government’s role in business does everything EXCEPT:

• A. Provide subsidies to select groups• B. determine supply & demand in the

marketplace• C. purchase large amounts of goods & services• D. collect retail sales taxes