Copyright 2019 Pearson Education, Inc.

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Essentials of Entrepreneurship and Small Business Management, 9e (Scarborough) Chapter 1 The Foundations of Entrepreneurship

1) One of the most significant economic developments in recent business history relates to the

________.

• growth of blue-chip corporations
• development of Pacific Rim countries
• entrepreneurial spirit
• additional employment opportunities offered by government institutions

Answer: C

Diff: 1

Learning Obj: 1-1 Define the role of the entrepreneur in business in the United States and around the world.

AACSB: Reflective Thinking

2) The Kauffman Foundation reports that nearly one out of ________ entrepreneurs in the United States start businesses of their own because they cannot find jobs elsewhere.

• four
• five
• six
• seven

Answer: B

Diff: 2

Learning Obj: 1-1 Define the role of the entrepreneur in business in the United States and around the world.

AACSB: Reflective Thinking

3) Globally, one in eight adults is actively engaged in launching a business.

Answer: TRUE

Diff: 1

Learning Obj: 1-1 Define the role of the entrepreneur in business in the United States and around the world.

AACSB: Analytical Thinking

4) Current competitive conditions favor large companies over smaller ones because of their flexibility combined with their ability to use their size to achieve efficiency and economies of scale.

Answer: FALSE

Diff: 1

Learning Obj: 1-1 Define the role of the entrepreneur in business in the United States and around the world.

AACSB: Analytical Thinking

(Essentials of Entrepreneurship and Small Business Management, 9e Norman Scarborough, Jeffrey Cornwall) (Test Bank all Chapters) 1 / 4

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5) Increased entrepreneurial activity is a phenomenon unique to the U.S.

Answer: FALSE

Diff: 1

Learning Obj: 1-1 Define the role of the entrepreneur in business in the United States and around the world.

AACSB: Analytical Thinking

6) One study conducted by the Global Entrepreneurship Monitor (GEM) reports that nearly one in eight people in the United States is working to start a business.

Answer: TRUE

Diff: 2

Learning Obj: 1-1 Define the role of the entrepreneur in business in the United States and around the world.

AACSB: Analytical Thinking

7) The profile of an entrepreneur includes ________.

• a desire for responsibility and moderate risk
• confidence in the ability to succeed and determination
• a high level of energy, a desire for immediate feedback and a future orientation
• All the above

Answer: D

Diff: 1

Learning Obj: 1-2 Describe the entrepreneurial profile.

AACSB: Reflective Thinking

8) An entrepreneur is one who ________.

• is willing to attempt to implement a business concept and then give up if it does not meet

immediate expectations

• understands the process of developing an idea and does not need to understand what it means

to bring that idea to a viable business concept

• knows that the concept they are about to develop will result in a profitable business
• creates a new business concept for the purpose of achieving profit and growth by assembling

the necessary resources to capitalize on identified opportunities

Answer: D

Diff: 1

Learning Obj: 1-2 Describe the entrepreneurial profile.

AACSB: Analytical Thinking

9) All of the following are characteristics of the typical entrepreneur except ________.

• confidence in his/her ability to succeed
• value of money over achievement
• desire for immediate feedback
• a future orientation

Answer: B

Diff: 1

Learning Obj: 1-2 Describe the entrepreneurial profile.

AACSB: Reflective Thinking 2 / 4

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10) Entrepreneurs are characterized by ________.

• skill at organizing
• desire for immediate feedback
• high energy levels
• All of the above

Answer: D

Diff: 1

Learning Obj: 1-2 Describe the entrepreneurial profile.

AACSB: Reflective Thinking

11) Entrepreneurs who repeatedly start businesses and grow to a sustainable size before striking out again are known as ________ entrepreneurs.

• opportunistic
• persistent
• serial
• classic

Answer: C

Diff: 1

Learning Obj: 1-2 Describe the entrepreneurial profile.

AACSB: Reflective Thinking

12) Entrepreneurs typically possess ________.

• the ability to easily access capital
• a set of unique skills that is usually accompanied by advanced degrees in several areas
• a high level of commitment, have a tolerance for ambiguity, are flexible and tenacious
• specialized technical abilities

Answer: C

Diff: 2

Learning Obj: 1-2 Describe the entrepreneurial profile.

AACSB: Reflective Thinking

13) Entrepreneurs who start businesses because they cannot find work any other way are

________.

• necessity entrepreneurs
• serial entrepreneurs
• opportunity entrepreneurs
• corporate cast-offs

Answer: A

Diff: 1

Learning Obj: 1-2 Describe the entrepreneurial profile.

AACSB: Reflective Thinking

• / 4

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14) Research has isolated a set of characteristics that can predict who will succeed as an entrepreneur.

Answer: FALSE

Diff: 2

Learning Obj: 1-2 Describe the entrepreneurial profile.

AACSB: Diverse and Multicultural Work Environments

15) Serial entrepreneurs repeatedly start businesses and grow them to a sustainable size before striking out again.

Answer: TRUE

Diff: 1

Learning Obj: 1-2 Describe the entrepreneurial profile.

AACSB: Analytical Thinking

16) Surveys show that small business owners believe that, as entrepreneurs, they work harder, earn more money, and are happier than if they worked for a large company.

Answer: TRUE

Diff: 2

Learning Obj: 1-2 Describe the entrepreneurial profile.

AACSB: Reflective Thinking

17) The opportunity to reap impressive profits is the primary motivation for most entrepreneurs.

Answer: FALSE

Diff: 2

Learning Obj: 1-2 Describe the entrepreneurial profile.

AACSB: Reflective Thinking

• / 4