Introduction to Business Quiz 2 Question3

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There are about ________ people in the United States, but over ________ in the world.
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Select one:
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a. 5 million; 6 billion
A master limited partnership (MLP) is:
b. 290 million; 6 billion
Select one:
c. 5 million; 100 million
a. not traded on the stock exchanges.
d. 275 million; 1 billion
b. pays corporate income taxes.
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c. taxed like a partnership.
The correct answer is: 290 million; 6 billion
d. the corporate form of choice for small groups of individuals.
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The correct answer is: taxed like a partnership.
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One of the major disadvantages of a sole proprietorship is the:
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Select one:
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a. possibility of disagreements between owners.
A market consists of potential buyers of a good or service. However, for a market to exist:
b. unlimited liability the owner has for the debts of the firm.
Select one:
c. fact that any income earned by this type of business is taxed twice.
a. wholesalers and retailers are involved in the distribution of the product.
d. high cost of starting or ending the company.
b. one firm must dominate in sales and product development.
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c. people must have unsatisfied wants and needs as well as a willingness and ability to
The correct answer is: unlimited liability the owner has for the debts of the firm.
buy.
d. the product must be laboratory tested and approved by the Federal Food and Drug Question5
Administration (FDA). Correct

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The correct answer is: people must have unsatisfied wants and needs as well as a
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willingness and ability to buy.

Nearly half of home-based businesses are in: c. food is a low priority item for most students.
Select one:
d. most high school students can't afford to eat at expensive restaurants.
a. Idaho.
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b. the service industries.
The correct answer is: most high school students can't afford to eat at expensive
c. bankruptcy court.
restaurants.
d. manufacturing.
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The correct answer is: the service industries.
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Marco is a franchisee with Daggies, a chain of sandwich shops. His business was doing
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well until several Daggies franchisees got in trouble and were forced to close their shops.
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Soon afterward, Marco's business deteriorated and he too was forced to close. This is an
The business plan of a new entrepreneur should include which of the following? example of:
Select one: Select one:
a. lifestyle of the competition a. an economic shakeout at work.

b. qualifications of the owners b. the coattail effect.

c. import/export information c. the law of diminishing returns.
d. names of employees d. management by exception.
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The correct answer is: qualifications of the owners The correct answer is: the coattail effect.

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Holiday Shores is an expensive, five-star restaurant with an outstanding reputation. A firm can attract skilled employees by offering benefits such as stock options if it is a:
Although located about two miles from a high school, the restaurant does not view the Select one:
students as part of their market. The restaurant's view is likely correct because: a. sole proprietorship.
Select one: b. general partnership.
a. the school is more than a mile from the restaurant. c. limited partnership.
b. the school cafeteria provides all of the food the students require.

The correct answer is: is a franchisor.

d. corporation.
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The correct answer is: corporation.
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Finley is a limited partner in Gettout & Associates. Heywood U. Gettout, one of the senior
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general partners in the company, must temporarily leave the company to attend to some
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personal matters. Heywood has asked Finley to temporarily perform his managerial duties
Entrepreneurs looking for a business that gives them the best opportunity to get rich should while he is gone. As a limited partner, Finley:
consider starting a business in: Select one:
Select one: a. can fill in as a manager whenever necessary, as long as it is for only a limited time.
b. can make managerial decisions as long as they do not involve the payment of money.
a. the manufacturing sector.
b. the food service industry. c. cannot participate in the management of the partnership.
c. a low risk industry. d. can manage the firm as long as he gets approval from the company's other general partners.
d. the agriculture sector. Feedback
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The correct answer is: cannot participate in the management of the partnership.
The correct answer is: the manufacturing sector.
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Entrepreneurs don't always focus on what customers need. They also look for:
Daggie's Sandwiches, Inc., sells the rights to use its name and sell its sandwiches in a given Select one:
market area to aspiring business people who are willing to pay agreed upon fees and meet a. how the weather will affect the business.
certain contractual terms. Daggie's:
b. what customers don't need.
Select one:
c. how many employees are required to meet SBA standards.
a. is offering investors the opportunity to form limited partnerships.
d. what government agency will provide financial assistance with income taxes.
b. is a franchisor. Feedback
c. creates private subsidiary companies.
The correct answer is: what customers don't need.
d. offers a tax-free investment potential.
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One reason limited liability companies have become so popular is that they: Small businesses create about __________ percent of the new jobs in the United States.
Select one: Select one:
a. can be taxed either as a corporation or as a partnership, so owners can choose the tax a. 10
b. 25
treatment that is most advantageous for their situation.
b. allow owners to sell their interests in the company without requiring approval from other c. 75
owners. d. 100
c. have unlimited life. Feedback
d. allow owners to avoid paying self-employment taxes on the company's profits.
The correct answer is: 75
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The correct answer is: can be taxed either as a corporation or as a partnership, so owners
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can choose the tax treatment that is most advantageous for their situation.
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Which of the following best describes the difference between an intrapreneur and an
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entrepreneur?
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Select one:
For prospective entrepreneurs, enrolling in an introduction to business or small business a. Intrapreneurs start nonprofit organizations while entrepreneurs start profit-seeking
management course offered through their community college: businesses.
Select one: b. Intrapreneurs are practical while entrepreneurs are creative.
a. is likely to be wasted time since college courses tend to be too theoretical. c. Intrapreneurs work within existing corporations while entrepreneurs assume the risks of
b. can be helpful by offering them an opportunity to meet experienced small business
starting their own business.
owners. d. Intrapreneurs limit their efforts to financial investments, while entrepreneurs are involved in
c. would be most helpful only after starting their business venture. the management of all areas of a business.
d. would offer training equivalent to two years of on-the-job experience. Feedback
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The correct answer is: Intrapreneurs work within existing corporations while entrepreneurs
The correct answer is: can be helpful by offering them an opportunity to meet experienced assume the risks of starting their own business.
small business owners.
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Trans Globe Airlines has recently looked into a merger with Royal Blue Airlines, a financially
troubled rival. The firms believe the merger will create a stronger company that can offer Rhonda has agreed to invest $16,000 in a partnership with her sister and brother-in-law.
travelers more flights to a wider variety of destinations. This proposed merger is an example Rhonda does not plan to work in the partnership, nor does she wish to risk any of her own
of a: wealth other than the $16,000 she invests, but she does intend to share in any profits
Select one: earned by the partnership. Evidently, Rhonda will be a(n):
a. conglomerate merger. Select one:
b. leveraged buyout. a. restricted partner.
b. preferred stockholder.
c. horizontal merger.
c. secondary partner.
d. joint venture.
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The correct answer is: horizontal merger.

Question19 The correct answer is: limited partner.

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Mara plans to open a shop specializing in foods and cultural items from the Middle East.
She wants to be the firm's only general partner, but she is trying to get several friends to According to the Uniform Partnership Act, the three key elements of any general partnership
participate as limited partners. Apparently Mara wants to: are:
Select one: Select one:
a. limit her personal liability to the amount she personally invests in the company. a. a board of directors, a written partnership agreement, and a well-defined product or service.
b. be the only person allowed to share in the firm's profits. b. two owners, an adequate financial base, and a written statement describing the manner in
c. obtain a strong financial base for the firm while maintaining personal control over the firm's which profits and losses will be divided.

management. c. common ownership, shared profits and losses, and right to participate in management.
d. meet the legal requirements of the Uniform Partnership Act. d. common stock, a board of directors, and a statement of limited liability.
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The correct answer is: obtain a strong financial base for the firm while maintaining personal The correct answer is: common ownership, shared profits and losses, and right to
control over the firm's management. participate in management.

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Which of the following statements identifies an advantage for women who have become Chris is an angel investor. This means that she:
franchisors in recent years? Select one:
Select one:
a. invests her own money in new businesses before they sell stock publicly.
a. The federal government has offered a series of special financial incentives to women to
b. creates business incubators for startup Web-based firms.
encourage them to convert their businesses into franchises.
c. is involved in providing startup money for new churches and other nonprofits.
b. Women usually have less difficulty than men obtaining the needed start-up capital to
d. provides assistance for struggling entrepreneurs.
establish a franchise.
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c. Women business owners have found that operating their businesses as franchises is the
best way to limit their personal liability. The correct answer is: invests her own money in new businesses before they sell stock
d. Women business owners have learned that becoming franchisors can help them finance the publicly.

costs of business expansion. Question25

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The correct answer is: Women business owners have learned that becoming franchisors
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can help them finance the costs of business expansion.
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Question23
One characteristic of micropreneurs is a:
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a. personal focus on security.
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Question text b. long-term vision instead of a short-term payoff.

c. preference for establishing routines.
Which of the following would be a disadvantage of working for a small business?
d. desire for receiving a paycheck rather than earning a profit.
Select one:
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a. required input regarding how the business is run
The correct answer is: long-term vision instead of a short-term payoff.
b. fewer benefits !
c. more chance your ideas will be heard by the owner
d. more challenging jobs
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The correct answer is: fewer benefits

Question24