Small Business Management BA 313-01
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An Entrepreneurial Life - Chapter 1 Review

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Chapter 1 Review:

1. Compared to large corporations, small businesses play just as important a part in the economy.
2. The argument developed in Chapter 1 about entrepreneurial opportunities holds that potentially profitable opportunities exist at all times.
3. Any individual is free to enter into business for himself/herself.
4. As the economy continues to gobalize, small businesses become increasingly involved in international business.
5. An entrepreneur starts or owns/operates a small business.
6. According to the textbook, firms with over 100 employees would be excluded as a small business.
7. The three primary rewards or incentives for entrepreneurs are independence, personal fullfillment, and profit.
8. Five resons people decide to become entrepreneurs include: 1) make money, 2) independence, 3) Freedom, 4) personal satisfaction, and 5) personal fullfillment.
9. A refugee is a person who becomes an entrepreneur to escape an undesirable situation. Examples: a person who dislikes their fther's criticism in the fmily business, an individual who dislikes acdemics, a person who goes to another country to obtain a better way of life, a housewife whose children are grown, and many more.
10. Large businesses like Chrysler, Ford, or GM are laying off many workers, some of these persons who decide to start their own business would be called corporate refugees.
11. A person who starts a business is classified as a Founder.
12. A microbusiness is a small firm that is profitable but only provides a modest return to the entrepreneur.
13. An entrepreneurial team is a group composed of individuals who work together for the same small firm.
14. An opportunistic entrepreneur is expected to be well-educated in non-technical matters.
15. Banks appear to be slow to offer loans to women.
16. Because they compete against powerful companies, it is important that entrepreneurs exploit the opportunities that are available to them.
17. Compared to larger companies, small firms may be better positioned to provide good customer service.
18. Because many entrepreneurs are innovators, they tend to see different and often better ways of doing things.
19. One of the ways that entrepreneurs often produce innovations is new ways of doing business (page19).
20. An ideal period of live for starting a business is between the mid-twenties and mid-thirties
21. Individuals who have entered business as a result of financial hardship or other severe negative conditions are called reluctant entrepreneurs.
22. Individuals are typically pulled toward entrepreneurship by the hope of obtaining financial rewards.
23. A corporate manager chafes under red tape and bureaucratic regulations until finally deciding to start a separate business. The apparent reward being sought is a satisfying way of life.
24. A camera hobbyist starts a photographic supplies store. The most obvious reward for this entrepreneur is the opportunity to experience personal fulfillment.
25. Characteristics of artisan entrepreneurs include: They are paternalistic, they use few capital resources, and their time orientation is short.
26. Small businesses that have great prospects for growth are called gazelles.
27. A firm that provides substantial profits to its owner is called an attractive small firm.
28. We would expect an opportunistic entrepreneur to be well educated in non-technical matters.
29. Compared to the general population, entrepreneurs tend to have a passion for business and a higher internal locus of control.
30. One drawback of entrepreneurship is the risk of business failure.
31. In terms of willingness to assume risks, entrepreneurs show moderate risk-taking propensity.
32. Being passed over for promotion prompted an employee to quit and start her own business. This perceived injustice served as a precipitating event.
33. A small business’s advantages of finding a special niche include avoiding intense competition, serving a particular geographic, and having room for expansion.
34. A person that opens a franchise would be considered a limited entrepreneur.
35. A mentor would best describe a go-to person.
36. Approximately 50 percent of private gross national product is generated by small businesses.

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