Entrepreneurship Test Review 2012

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

1 Capital

2 What does ROI stand for?

2 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.

1 Monopoly

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

1 Importing

2 The process used to test a business concept.

2 Feasibility Analysis

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

1 Profit

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

2 Equilibrium

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

1 Scarcity

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

2 Demand

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

1 Franchise

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

1 Entrepreneurship

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

2 Exporting

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

1 Competition

2 Watchdog for consumers over products that may be hazardous.

2 Consumer Product Safety Commission

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

1 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.

1 Fair Labors Standard Act

2 Ensures safe and healthy working conditions for employees.

2 Occupational Safety & Health Act

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

2 Fair Packaging and Labeling Act

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

1 Target Market

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

2 Demographics

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

1 Psychographics

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

2 Geographics

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.

1 Buying Characteristics

2 Expresses specific goals for the company.

2 Mission Statement

2 This Association helps assist Americans in starting a business.

2 Small Business Association (SBA)

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

1 Increasing Prices

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

2 Sherman Anti-Trust Act

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

1 $4,000

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

2 Franchise

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

1 Price Decreases

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

2 Entrepreneur

1 Primary reason people start a business?

1 Profit Motive

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

2 Currency Exchange Rate

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

1 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.

2 Unethical

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

1 Brand Loyalty

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

2 Strengths and Weaknesse

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

1 Target Market

2 Data already collected

2 Secondary Data

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

1 Primary Data

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

1 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?

2 Niche Marketing

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

1 Perpetual Inventory

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

2 Physical Inventory count

1 Picture of prospective customers

2 Customer Profile

1 Cheapest way to advertise a school event

1 Flyers

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

2 Operating Expenses

1 1 st Step in Market Research

1 Identify Your Information Needs

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

2 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:

1 Accessibility of distribution methods

2 Tool used to show potential leaders your business idea

2 Business Plan

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

1 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

1 A OSHA

2 Expenses that change with each unit produced.

2 Variable Expenses

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

1 Character

2 What is 16% of $80,000?

2 $12,800

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

1 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?

2 $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?

1 $60

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

2 Non- Profit Organization

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

1 $20,000 x.25 = $5,000

2 Breaking down market into smaller groups

2 Market Segmentation

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

1 60%

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

1 $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 years 5 years = 60 months $70,000 / 60 = $1, monthly payment

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

2 Net Income

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

1 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

1 C – Federal Reserve Bank

2 Evaluating a competitors product selection, quality, promotional activities & pricing policies gives you information about their? A.Intent to sell B.Income Statement C.Strengths & Weaknesses D.Buying Characteristics

2 C. Strengths & Weaknesses

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

1

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

2

1 What is a disadvantage of owning your own business?

1 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?

2

1 Entrepreneurs do not:

1 Collect taxes from the government

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

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

2 Corporation

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

1 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

2