Test I: Identification

1. DEVELOPMENT ECONOMICS is a branch of economics that focuses on improving fiscal, economic, and social
conditions in developing countries.

2. ENTREPRENEURSHIP refers to the economic activity of a person who starts, manages and assumes the risk of
business enterprise

3. INNOVATION may be defined as the introduction of a new method, procedure, custom, device, among others.

4. A person who undertakes the risk of starting a new business venture is called and ENTREPRENEUR

5. ETHICS is the study of moral obligation involving the distinction between right and wrong

6. The rules about how entrepreneurs ought to behave are referred to as BUSINESS ETHICS.
7. PERSONALITY is the characteristic patterns of thoughts, feelings, and behaviors that make a person unique.
8. STATUS QUO- means all the business ideas listed passed the adapted criteria

9. PROJECTED BALANCE SHEET- shows the planned or expected financial position of the enterprise on a particular
date

10. PROJECTED FINANCIAL STATEMENT-The forecast of something which will happen in the future, it is a financial
record summarizing firms planned or expected financial performance in terms of revenues expenses, and profits
over a given period of time.

Test II:

 A SMALL BUSINESS may be defined under the total assets approaches as one having total assets that fall a
certain bracket. For example, the MAGNA CARTA FOR SMALL ENTERPRISE (R.A. 6977) Indicates that a firm must
have TOTAL ASSETS valued at above 1.5 million pesos to 15 million pesos to be considered small business. The
government prefers this approach because it simplifies formulation and implementation of policy.
 With the assets value bracket assigned to small business, it is investable that all enterprises having total assets
valued at 1.5 million pesos and below will be classified as “MICROENTERPRISES”.
 WHOLESALING is the business of distributing goods in bulk to other businesses that repackage them in smaller
quantities for sale directly to consumers
 RETAILING covers all activities involved in the sale of goods and/ or services to the final consumers.
 Ethical Behavior whether by a person or a business entity, is influenced by any or a combination of the following:
SITUATION, REWARD SYSTEM, INDIVIDUAL DIFFERENCES; and Other factors
 Entrepreneurs are expected to be REASONABLE RISK TAKER, not conservative but gamblers.
 A SOUND BUSINESS IDEA is an economic opportunity which is within the reach of the enterprise and which could
provide a desirable value
 Strategic Planning, The definition involves three steps: (1) DETERMINATION OF OBJECTIVES, (2) ADOPTION OF
COURSE OF ACTION, AND (3) ALLOCATION OF RESOURCES.
 TACTICS are more detailed and they are used to determine how the specific task can best be accomplished on
time.

Test III:

1. The environment and entrepreneur’s personality are complementary factors that determine whether or not
the new business venture will succeed. ENVIRONMENT
2. Entrepreneurs are different from managers because they perform functions that are distinct from each
other. MANAGERS
3. The success of a new entrepreneurial venture depends on the adaption of a sound business idea. The same
requirement applies to an established business. SOUND BUSINESS IDEA

4. A carefully designed plan for achieving the objectives is called planning. STRATEGY
5. Important as it is, small business operators often ignore strategic planning for various reasons.
 6. Strategic planning provides an answer, in strategic planning the major objectives of the organization are
determined, and strategies are formulated to achieve those objectives.
7. New Business- the term refers to one that will be operated for the first time by the small business operator.
8. Although entrepreneurship is generally regarded as a useful means of running a small business, it is also
conducive in maintaining the growth of large corporations.
9. New venture must develop it into a small business or grow into mature and biggest company. This is
because the entrepreneur must recover the cost of opening the venture.
10. Businesses, especially small enterprises, are important segments of our society. a small business is one
which is independently owned and which is not dominant in its field of operation. SMALL ENTERPRISES

Test IV: Matching Type 10

1. Invention –discovery or devising of new products and processes

2. Independent management- the owner is also the manager
3. Innovation –actual introduction of a new product or process
4. Self-confident- he does his job without inhibition.
5. Development –the process by which the ideas and principles generated from the stage of
6. Strategic Objectives- specific performance targets the entrepreneurship hopes to accomplish.
7. Enterprising- entrepreneur
8. Social-DSWD
9. Realistic- engineer
10. Investigative- biologist
 Test V:
 Small businesses play an important role in the development of our economy. They assume the following
functions
 Business ideas may be screened with the use of the following criteria:
 There are two general methods of generating business ideas. They are as follows:
 Effective Innovation assures the continuous survival growth of the enterprise, but innovation can only thrive in a
creative organization with culture characterized by the following: CULTURE CHARACTERISTICS OF CREATIVE
ORGANIZATION
1) ENCOURAGEMENT OF CREATIVITY AND RISK TAKING- 5) A CLIMATE PARTICIPATION
2) REWARDS FOR CREATIVITY 6) STRUCTURAL MECHANISM THAT CREATIVITY
3) OPEN COMMUNICATION 7) TRAINING CREATIVE PROCESS; AND
4) ALLOWANCE ERROR 8) FLEXIBILITY

Why Small Business Operators Ignore Strategic Planning

Important as it is, strategic planning in small business management is often ignored. This situation is true in many parts
of the world including our country. The reasons could be any of the following:

1. LACK OF EXPERTISE
2. INABILITY TO GET STARTED
3. UNCONTROLLABLE, OFTEN INTANGIBLE VARIABLES
4. RESOURCE POVERTY
5. FOCUS ON DAILY OPERATIONS
6. FAILURE THE IMPORTANCE OF STRATEGIC PLANNING

The transition from a new venture to a successful long-term enterprise consists of at least four major stages

1. PRESTART-UP STAGE,
2. START-UP STAGE,
3. EARLY GROWTH STAGE, AND
4. LATE GROWTH STAGE