220+ Entrepreneurship and Small Business Management Solved MCQs

Chapters

Chapter: Unit 1
1.

Which of the following is the correct definition of the term 'entrepreneur', as used by the OECD?

A. Entrepreneurs are those people who start new businesses with the aim of making a profit.
B. Entrepreneurs are those persons (business owners) who seek to generate value through the creation or expansion of economic activity, by identifying and exploiting new products, processes or markets.
C. Entrepreneurs are those persons who seek to create value by starting new businesses with innovative products and services.
D. Entrepreneurs are those people who seek to create value for local communities, people or customers by starting new ventures which exploit new products, processes or markets.
Answer» B. Entrepreneurs are those persons (business owners) who seek to generate value through the creation or expansion of economic activity, by identifying and exploiting new products, processes or markets.
2.

What is the definition of the term, 'social enterprise'?

A. A commercial organization that seeks to combine a profit seeking motive with the provision of social benefits.
B. A trading organization that is motivated by profit and a societal orientation.
C. A social enterprise undertakes social marketing and can take a variety of legal forms, including co-operative, a limited company and a community interest company.
D. A trading organization which serves a social purpose and which can take a variety of legal forms, including co-operative, a limited company and a community interest company.
Answer» D. A trading organization which serves a social purpose and which can take a variety of legal forms, including co-operative, a limited company and a community interest company.
3.

Intrapreneurship often takes the form of ...

A. a semi-autonomous group (e.g. an internal venture team), operating within the overarching structure of the parent organization.
B. a spinout venture from a university to commercial a new invention.
C. a subsidiary of a large corporation developing a new product.
D. a semi-autonomous group operating outside the overarching structure of the parent organization.
Answer» A. a semi-autonomous group (e.g. an internal venture team), operating within the overarching structure of the parent organization.
4.

The goals motivating entrepreneurial activity can include which of the following options:

A. To improve the social welfare of people, e.g. in terms of their health.
B. To improve the wealth of the entrepreneurs.
C. To maintain influence amongst powerful local figures.
D. All of the above.
Answer» A. To improve the social welfare of people, e.g. in terms of their health.
5.

Can entrepreneurship be 'learned'?

A. Entrepreneurs are born and not made
B. It's a discipline and like any other discipline it can be learned.
C. You will never become an entrepreneur simply by reading a book
D. Practical exercises, study and critical reflection can be a good way to think about
Answer» D. Practical exercises, study and critical reflection can be a good way to think about
6.

Which of these statements best describes the context for entrepreneurship?

A. Entrepreneurship takes place in small businesses.
B. Entrepreneurship takes place in large businesses.
C. Entrepreneurship takes place in a wide variety of contexts.
D. Entrepreneurship does not take place in social enterprises.
Answer» C. Entrepreneurship takes place in a wide variety of contexts.
7.

Which statement is not true of entrepreneurs?

A. They change the way businesses convert inputs into outputs
B. They generally stick to the processes already in use.
C. They take risks
D. They apply innovative ideas
Answer» B. They generally stick to the processes already in use.
8.

Pichot suggested three roles for the intrapreneur in promoting innovation. What are they?

A. Team builder, information source and advocate
B. Inventor, innovator and sponsor
C. Inventor, developer and marketer
D. Inventor, product champion and sponsor
Answer» D. Inventor, product champion and sponsor
9.

Why is the notion of 'vision' important in entrepreneurship?

A. Without it there is no driving force or sense of direction.
B. People need a sense of fantasy in order to create ambitious ventures.
C. Investors prefer to invest in visionaries.
D. Having a vision helps to create a paradigm shift.
Answer» A. Without it there is no driving force or sense of direction.
10.

What are the two key issues that arise when you create an effective entrepreneurial team from scratch?

A. Team mentality and team synergy
B. Team numbers and team quality
C. Team composition and team roles
D. Team experience and team experience
Answer» C. Team composition and team roles
11.

Establishing a shared vision amongst team members refers to:

A. Members of the team starting out with an essentially similar set of ideas about what they want to create.
B. Members of the team sharing moral principles and standards of behaviour.
C. Members of the team sharing the factors driving them to take part in the venture.
D. Members of the team sharing profits in an equitable manner.
Answer» C. Members of the team sharing the factors driving them to take part in the venture.
12.

What are the main differences between marketing in a 'corporate setting' and an 'entrepreneurial' one?

A. Lack of resources; lack of brand name; difficulties in making contacts.
B. Greater emphasis on personal selling and personal networking.
C. Faster decision making; more personal responsibility.
D. Better profit margins; lower costs and greater flexibility.
Answer» A. Lack of resources; lack of brand name; difficulties in making contacts.
13.

According to Schumpeter, Innovation occur in the following forms:

A. 2
B. 3
C. 4
D. 5
Answer» D. 5
14.

Innovative entrepreneur ensures:

A. Static equilibrium
B. Dynamic equilibrium
C. Static disequilibrium
D. Dynamic disequilibrium
Answer» D. Dynamic disequilibrium
15.

The book “Innovation and Entrepreneurship” is written by:

A. J.B. Say
B. J.A. Schumpeter
C. Peter F. Drucker
D. Cantillon
Answer» C. Peter F. Drucker
16.

No. of sources for innovative opportunity is given by Peter Drucker.

A. 5
B. 6
C. 7
D. 8
Answer» C. 7
17.

Fabian Entrepreneurs are characterized by:

A. Hardworking
B. Religious and traditional
C. Shy and Lazy
D. Ready to take risk
Answer» C. Shy and Lazy
18.

Drone entrepreneur are those who generally

A. Earn super profit
B. Earn normal profit
C. Earn profit or even losses
D. Incur losses
Answer» C. Earn profit or even losses
19.

Systematic innovation means

A. Monitoring different sources of or innovative opportunity
B. Developing different types of entrepreneurial behavior
C. Identifying different new business opportunity
D. Creating bases for systematic creativity
Answer» A. Monitoring different sources of or innovative opportunity
20.

Supply of entrepreneur depends on the

A. Rate of the profit available
B. Prevailing social climate
C. Rate of profit and social climate
D. None of the above
Answer» C. Rate of profit and social climate
21.

The 'enterprise culture' is a general interest in developing new ventures

A. True
B. False
C. all
D. none
Answer» B. False
22.

Which of the following is presented as evidence of social factors influencing whether someone becomes an owner-manager?

A. Although people believe self-employment runs in families, there is little evidence to support this view.
B. There seems to be little relationship between self-employment and age.
C. Self-employment is more common among some ethnic groups.
D. Self-employment is more common among single people than among the married.
Answer» C. Self-employment is more common among some ethnic groups.
23.

Which of the following is not one of the environmental factors that may influence the potential of a small business?

A. Close contacts with customers related to problem solving activities
B. Clusters of technically advanced small firms
C. An industry with economies of scale
D. Banks recognising the needs of small firms
Answer» C. An industry with economies of scale
24.

What factors have contributed to the blurring of boundaries between different industries?

A. Technological innovation; political change; legal and socio-economic changes
B. Technological innovation
C. Changes amongst customers, competitors and suppliers
D. Both (a) and (d)
Answer» A. Technological innovation; political change; legal and socio-economic changes
25.

One of the differences between marketing in a corporate setting and an entrepreneurial one is the reliance by the entrepreneur on personal credibility and skills in persuasive communication.

A. True
B. False
C. all
D. none
Answer» A. True
26.

EDP meant for developing

A. Professional skill
B. Entrepreneurial motive
C. Personal qualities
D. Entrepreneurial monitoring
Answer» B. Entrepreneurial motive
27.

EDP is required to help

A. Existing entrepreneur
B. First generation entrepreneur
C. Future Entrepreneur
D. None of the above
Answer» B. First generation entrepreneur
28.

Following is not involved in EDP

A. Identification of entrepreneurs for training
B. Selection of entrepreneurs for training
C. Developing entrepreneurial capabilities
D. Arranging infrastructural facilities
Answer» D. Arranging infrastructural facilities
29.

EDII was developed by the

A. Government of India
B. State Government
C. All India Financial Institutions
D. Public sector banks
Answer» C. All India Financial Institutions
30.

NIESBUD was established in

A. 1980
B. 1983
C. 1986
D. 1989
Answer» B. 1983
31.

All but which of the following is considered to be a myth associated with entrepreneurship?

A. Successful entrepreneurs are born not made
B. First ventures are always successful
C. All entrepreneurs must willingly invest significant sums of money
D. Successful entrepreneurs must have a break-through invention
Answer» A. Successful entrepreneurs are born not made
32.

An ______ is best described by stating it is any business that is independently owned and operated and is not dominate in its market.

A. strategic alliance
B. corporation
C. entrepreneurship
D. proprietorship
Answer» A. strategic alliance
33.

For small business owners, one of the most important objectives is _______.

A. market presence
B. growth
C. profitability
D. adaptability
Answer» C. profitability
34.

Which of the following is not considered a common characteristic of an entrepreneur?

A. Internal locus of control
B. High need for achievement
C. Self-confidence
D. External locus of control
Answer» A. Internal locus of control
35.

The entrepreneur who is committed to the entrepreneurial effort because it makes good business sense is classed as a/an _____.

A. inventor
B. opportunist
C. hacker
D. craftsman
Answer» B. opportunist
36.

Melissa is one of the newest and most successful entrepreneurs in the technology industry. She handles numerous dealings with other companies for the exchange of goods and services. Her primary goal is to ensure that all parties involved receive favorable and acceptable terms. Melissa is most probably excellent at the entrepreneurial skill of _______.

A. negotiating
B. networking
C. leadership
D. analysis
Answer» C. leadership
37.

The ideas for new businesses that are obtained by entrepreneurs are derived from many sources. These various sources include all but _______.

A. replication of an existing business
B. trade journals
C. trade shows
D. family members
Answer» C. trade shows
38.

Which of the following shows the process of creating something new?

A. Business model
B. Modeling
C. Innovation
D. Creative flexibility
Answer» C. Innovation
39.

Which one of the following theory has the attribute of moderate risk taking as a function of skill, not chance?

A. Need for independence
B. Need for achievement
C. Need for affiliation
D. Need for authority
Answer» B. Need for achievement
40.

In which of the following domain; individuals take decision to help others for achieving their dreams?

A. Traditional managers
B. Entrepreneurs
C. Intrapreneurs
D. Administrative managers
Answer» C. Intrapreneurs
41.

An entrepreneur is a person who is a:

A. Risk taker
B. Initiator
C. Actor
D. All of the given options
Answer» D. All of the given options
42.

Which one of the following is NOT an intrapreneurial leadership characteristic?

A. Understands environment
B. Encourage the team work
C. Not flexible
D. Persistent
Answer» C. Not flexible
43.

All but which of the following is considered to be a myth associated with entrepreneurship?

A. Successful entrepreneurs are born not made
B. First ventures are always successful
C. All entrepreneurs must willingly invest significant sums of money
D. Successful entrepreneurs must have a break-through invention
Answer» B. First ventures are always successful
44.

A/An ______ is best described by stating it is any business that is independently owned and operated and is not dominate in its market.

A. strategic alliance
B. corporation
C. entrepreneurship
D. proprietorship
Answer» C. entrepreneurship
45.

Which of the following is not considered a common characteristic of an entrepreneur?

A. Internal locus of control
B. High need for achievement
C. Self-confidence
D. External locus of control
Answer» D. External locus of control
46.

Bobby believes that what takes place within his new company is mostly the result of fate or factors that are outside of his control. It could be stated that Bobby possesses a/an ______.

A. innovative spirit
B. intrapreneurship
C. internal locus of control
D. high need for achievement
Answer» A. innovative spirit
47.

Entrepreneurial Opportunities are defined as: 128

A. situations in which new goods, services, raw materials and organizing methods can be sold at greater than their production cost.
B. New market entry through entrepreneur action.
C. The entrepreneur's mental processes in deciding whether or not to act on a potential opportunity.
D. A feasibility assessment.
Answer» D. A feasibility assessment.
48.

Which among the following aspects affects an entrepreneur's perception of feasibility?

A. Locus of control
B. Learning style
C. Perceived desirability
D. Self-efficacy
Answer» C. Perceived desirability
49.

As the venture becomes established and starts growing, which of the following types of experience becomes increasingly important?

A. Technical
B. Financing
C. Managerial
D. Marketing
Answer» B. Financing
50.

Intrapreneurship is best described as:

A. the hiring of former Entrepreneurs.
B. Entrepreneurial action within an organization.
C. The process of buying acquiring entrepreneurial firms.
D. The process of hiring consultants to teach a firm how to be more creative.
Answer» D. The process of hiring consultants to teach a firm how to be more creative.
51.

_____ includes initiative and risk taking, as well as competitive aggressiveness and boldness.

A. New business venturing
B. Self-renewal
C. Innovativeness
D. Proactive Behavior
Answer» B. Self-renewal
52.

In regards to the differences between the entrepreneurial and administrative focuses which of the following is correct?

A. Entrepreneurs focus on slow steady growth and managers’ focus on rapid growth
B. Entrepreneurs rent or sporadically use resources; managers like to own resources
C. Entrepreneurs are driven by controlled resources; managers by opportunity
D. Entrepreneurs tend to use a hierarchical management structure; managers use a more fluid, flat approach
Answer» D. Entrepreneurs tend to use a hierarchical management structure; managers use a more fluid, flat approach
53.

. Entrepreneurial culture and growth orientation consists of all of the following except:

A. Encouraging employees to generate ideas.
B. Focusing on opportunities.
C. The desire to grow at a slow and controlled pace.
D. Being creative.
Answer» A. Encouraging employees to generate ideas.
54.

All these are characteristics of an entrepreneurial environment except:

A. there is short term horizons.
B. new ideas are encouraged.
C. the organization operates on frontiers of technology.
D. it uses a multidiscipline teamwork approach.
Answer» B. new ideas are encouraged.
55.

Which of the following is true about corporate entrepreneurship (Inrapreneurship)?

A. Equity in a new venture should not be used as a reward due to its uncertain value
B. A company must be willing to invest money without a guarantee of a return in the short term
C. Teams should be segmented by department
D. Top management should not be involved in the process.
Answer» B. A company must be willing to invest money without a guarantee of a return in the short term
Chapter: Unit 2
56.

Which of the following is a disadvantage of the 'drafting a traditional business plan' approach?

A. They do not reflect the way in which people shape their entrepreneurial visions.
B. It can be difficult to explain your vision to other people.
C. This approach lacks rigour.
D. The process involved can help an entrepreneur to improve their own understanding
Answer» A. They do not reflect the way in which people shape their entrepreneurial visions.
57.

Which of the following are 'drivers' underlying the opportunity business model?

A. Societal, commercial, legal, technological, people
B. Societal, commercial, legal, technological
C. Societal, ethical, commercial, legal, technological
D. Societal, commercial, legal, technological, environmental.
Answer» B. Societal, commercial, legal, technological
58.

What are the main sources of entrepreneurial opportunity?

A. Personal - entrepreneurs experience or perceive something that others do not.
B. Secondary research - from industry analyses.
C. Primary research - from speaking to potential customers to determine their needs.
D. Observation - of other peoples' experiences with products and services.
Answer» A. Personal - entrepreneurs experience or perceive something that others do not.
59.

Social innovation refers to:

A. the introduction of new social practices, activities or ways of organizing.
B. the introduction of novelties; the alteration of what is established by the introduction of new elements or forms.
C. new designs, processes, marketing approaches, or a new way of conducting training.
D. the means by which entrepreneurs exploit change as an opportunity for a different business or service.
Answer» A. the introduction of new social practices, activities or ways of organizing.
60.

Entrepreneurial opportunities are a particular type of opportunity, which could lead you to create a self-sustaining venture.

A. True
B. False
C. all
D. none
Answer» A. True
61.

Porter also argues that much of innovation is 'dependent on a single, major technological breakthrough rather than mundane and incremental'

A. True
B. False
C. all
D. none
Answer» B. False
62.

In the creativity and innovation matrix, what is a 'medium level of creativity' and a 'medium level of innovation' referred to as?

A. Winner
B. Loser
C. Mediocre
D. Average
Answer» D. Average
63.

The following example of networking represents which type of activity: In an entrepreneurial setting, you might be: renewing contact with a old school friend, now working in a finance house, to provide advice or support for the venture; converting an informal contact made while on holiday into a potential client; or building a much closer relationship with a supplier, which may lead to a formal alliance or merger.

A. Creating new ties
B. Renewing and pruning existing ties
C. Developing existing ties
D. Extending existing ties
Answer» A. Creating new ties
64.

_________ __________ between people in the personal contact network play an important communications role, enabling the entrepreneur to identify opportunities that are not evident to others.

A. Good relations
B. Weak ties
C. Strong ties
D. Unique connections
Answer» C. Strong ties
65.

What are the missing words in the following definition: 'The management of regular marketing can be characterized by a careful planning process which is informed by _____ _____ to guide the selection of target markets and the composition of a marketing mix with which to position products competitively within the marketplace.

A. Environmental forecasting
B. Market research
C. Product analysis
D. Customer understanding
Answer» B. Market research
66.

What characterizes the techniques used in entrepreneurial marketing?

A. Mass media, passive reception, customer resistance
B. Low cost, word-of-mouth
C. Informal, personal and strongly interactive
D. Guerrilla marketing and ambush marketing
Answer» C. Informal, personal and strongly interactive
67.

New entrepreneurial ventures face the same marketing opportunities and challenges, as compared to their larger and more well-established counterparts.

A. True
B. False
C. all
D. none
Answer» B. False
68.

Business opportunity relates with

A. Business possibilities
B. Commercially feasible projects
C. Risky projects
D. Favourable market demand
Answer» B. Commercially feasible projects
69.

Early growth stage fails to consider following symptoms.

A. Very slow
B. Perceived comfort zone
C. Very rapid
D. Rapid
Answer» D. Rapid
70.

Very rapid situation indicates

A. Increase in production
B. Rapid increase in production
C. Rapid increase in sales
D. Increase in sales
Answer» D. Increase in sales
71.

Enterprise positioning is meant for

A. Short-term arrangement
B. Continuous process
C. Long-term process
D. None of the above
Answer» C. Long-term process
72.

Techno-economic analysis deals with identification of the

A. Supply potential
B. Demand potential
C. Export potential
D. Import potential
Answer» B. Demand potential
73.

Input analysis relates with

A. Funding requirement
B. Material requirement
C. Labour requirement
D. Resource requirement
Answer» D. Resource requirement
74.

General objective of selecting a location is not he following

A. Minimise the cost of production
B. Minimise the distribution cost
C. Minimise the cost of capital
D. None of the above
Answer» C. Minimise the cost of capital
75.

External economies affect location

A. Generally
B. Exceptionally
C. All of the above
D. None of the above
Answer» B. Exceptionally
76.

The initial stages of the entrepreneurial process are generating new business ideas (i.e. creativity and innovation) and recognizing opportunities that have the potential for exploitation (i.e. evaluation and selection).

A. True
B. False
C. all
D. none
Answer» A. True
77.

Which of the following is NOT one of the definitions of 'business models' as identified in the text?

A. The system of components, linkages and associated dynamics, which that make commercial advantage of the Internet.
B. A business model describes the rationale of how an organization creates, delivers and captures value.
C. Business models identify where the resources necessary to establish a venture will come from.
D. Business models describe, as a system, how the pieces fit together.
Answer» C. Business models identify where the resources necessary to establish a venture will come from.
78.

Which of the following statements is true?

A. The entrepreneurial process starts with creativity and the task of generating new ideas.
B. The creativity process starts with innovation and the task of generating new ideas.
C. The idea generation process starts with creativity and the task of innovation.
D. The innovation process starts with creativity and the task of generating new ideas.
Answer» D. The innovation process starts with creativity and the task of generating new ideas.
79.

What are markets made up of?

A. Customers and competitors
B. Customers and potential customers
C. Customers, competitors and suppliers
D. Customer, competitors, suppliers and regulators
Answer» B. Customers and potential customers
80.

Product development process involves

A. One stage
B. Two stage
C. Three stage
D. Four stage
Answer» D. Four stage
81.

Incubation stage deals with

A. Sample development
B. Idea development
C. Prototype Development
D. None of the above
Answer» C. Prototype Development
82.

Product design defines

A. Micro activities of the project
B. Macro activities of the project
C. Allied activities of the project
D. Individual activities of the project
Answer» A. Micro activities of the project
83.

Feasibility study is defined as

A. Formal investigation of profitable opportunity
B. Informal investigation of profitable opportunities
C. Intensive investigation of profitable opportunities
D. None of the above
Answer» A. Formal investigation of profitable opportunity
84.

Project selection is

A. Product idea is used as a basis for project idea
B. Project idea is used as a basis for product idea
C. Both are the same
D. None of the above
Answer» A. Product idea is used as a basis for project idea
85.

General criteria is concerned with

A. Entrepreneur’s own interests
B. Economic development of the country
C. Business environment of the country
D. None of the above
Answer» A. Entrepreneur’s own interests
86.

A(n) ________ is defined as a form of business that is an association of two or more people acting as co-owners of a business.

A. proprietorship
B. partnership
C. INC
D. corporation
Answer» B. partnership
87.

Which one of the following would not be considered an advantage to a partnership formation?

A. Potential for double taxation
B. Less governmental control
C. Ease of formation
D. Direct share of profits
Answer» A. Potential for double taxation
88.

Which one of the following would not be considered a disadvantage of a corporation?

A. Limited continuality of life of enterprise
B. Extensive government regulations of activities
C. High incorporation fees
D. Corporate capital, profits, dividends, and salaries are double taxed
Answer» A. Limited continuality of life of enterprise
89.

Entrepreneurships require financial backing in order to get started in the business world. Which of the following is not one of the methods commonly utilized to obtain the financial resources needed?

A. Equity
B. Commercial loans
C. Personal finances provided by friends
D. Venture capitalists
Answer» D. Venture capitalists
90.

Of the following, which one would not be considered an alternative to independent entrepreneurship?

A. Franchise
B. Spin-off
C. Intrapreneurship
D. Extrapreneurship
Answer» B. Spin-off
91.

Of the following, which is best identified as an independent entrepreneurship that produces a product or service that originated in a large company?

A. Diversification
B. Intrapreneurship
C. Trade-off
D. Franchise
Answer» A. Diversification
92.

Management tactics purported to maximize innovation for an entrepreneurship include all but which of the following items?

A. Cutting of losses
B. Culture
C. Benchmarking
D. Customer orientation
Answer» B. Culture
93.

In franchising, the entrepreneur assumes fewer risks because the franchise provides all but which one of the following?

A. Established market for the product
B. Management assistance in operating the business
C. Economies of scale for purchasing
D. Oversale of rights
Answer» A. Established market for the product
94.

The ideas for new businesses that are obtained by entrepreneurs are derived from many sources. These various sources include all but _______.

A. replication of an existing business
B. trade journals
C. trade shows
D. family members
Answer» A. replication of an existing business
95.

The steps involved in an entrepreneurial endeavor include all but which one of the following?

A. Business plan formulation
B. Obtaining financing
C. Selecting the type of legal structure
D. Hiring a partner
Answer» D. Hiring a partner
96.

Common reasons for entrepreneurial failure include all but which one of the following?

A. Poor implementation
B. Lack of capital
C. Adequate financial support
D. Faulty product design
Answer» C. Adequate financial support
97.

A/An ________ is defined as the blueprint describing the business strategy for entering the

A. business alliance
B. spin-off
C. intrapreneurship
D. competitor analysis
Answer» C. intrapreneurship
98.

A(n) ________ is defined as a form of business that is an association of two or more people acting as co-owners of a business.

A. proprietorship
B. partnership
C. INC
D. corporation
Answer» B. partnership
99.

______ is best described as doing something differently and has been described as discontinuous or complementary change.

A. Entrepreneurship
B. Innovation
C. Spin-off
D. Variance
Answer» B. Innovation
100.

An opportunity assessment plan:

A. is the same thing as a business plan.
B. is longer than a business plan.
C. has a lot of computer-based spreadsheets.
D. focuses on the opportunity, not the venture.
Answer» D. focuses on the opportunity, not the venture.
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