MNE3701 EXAM PACK
2025
QUESTIONS AND
ANSWERS
FOR ASSISTANCE CONTACT
EMAIL:
, lOMoARcPSD|31863004
CGMV
Chapter 6: The Business Plan: Visualizing the Dream
6-1. Explain the purpose and objectives of business plans .
• A business plan is a document that sets out the basic idea underlying a business and describes
related startup considerations. It should explain where the entrepreneur is presently, indicate
where he or she wants to go, and outline how he or she proposes to get there.
• business plan has three key elements:
o (1) a logical statement of a problem and its solution,
o (2) a significant amount of hard evidence, and
o (3) candor about the risks, gaps, and assumptions that might be proved wrong.
• The objectives of a business plan include assessing whether a good idea is also a good
investment opportunity, determining whether the business aligns with your personal goals,
providing direction for insiders, and convincing outsiders to enter into a relationship with the
company.
6-2. Give the rationale for writing (or not writing) a business plan when starting a new venture.
• Studies attempting to measure whether entrepreneurs who have business plans do better than
those who don’t have produced mixed results. Some findings suggest a relationship; others do
not.
• What ultimately matters is not writing a plan, but implementing it. The goal is to execute the
plan.
• An entrepreneur must find the right balance between planning and becoming operational.
• For some startups, excessive planning isn’t beneficial because the environment is too turbulent,
fast action is needed to take advantage of an opportunity, or there’s a shortage of capital.
• Most entrepreneurs need the discipline that comes with writing a business plan. A written plan
helps to ensure systematic, complete coverage of the important factors to be considered in
starting a new business.
• A business plan helps an entrepreneur communicate his or her vision to current and prospective
employees of the business.
• By enhancing the business’s credibility, a business plan serves as an effective selling tool with
prospective customers and suppliers, as well as investors.
• A short (dehydrated) plan is an abbreviated form of a traditional business plan that presents
only the most important issues and projections for the business.
• A comprehensive plan is a complete business plan that provides an in-depth analysis of the
critical factors that will determine a business’s success or failure, along with the underlying
assumptions.
, lOMoARcPSD|31863004
CGMV
6-3. Explain the concept and process for developing a business model.
• The term business model has become a popular phrase in business, especially among
entrepreneurs and their investors.
• The business model measures the anticipated results of the core business decisions and all the
trade-offs that determine a company’s profits and cash flows.
• Understanding the business model is especially important in a startup, where there is so much
uncertainty.
• A business model explains in a systematic and clear way how a business will generate profits and
cash flows, given its revenue sources, its cost structures, the required size of investment, and its
sources of risk.
, lOMoARcPSD|31863004
CGMV
6-4. Describe the preferred content and format for a business plan.
• The opportunity, the critical resources, the entrepreneurial team, the financing structure, and
the context of an opportunity are all interdependent factors that should be given consideration
when thinking about the content of a business plan.
• Key sections of a business plan are the
o (1) cover page,
o (2) table of contents,
o (3) executive summary (overview),
o (4) company description,
o (5) industry, target customer, and competitor analysis,
o (6) product/service plan,
o (7) marketing plan,
o (8) operations and development plan,
o (9) management team,
o (10) critical risks,
o (11) offering,
o (12) exit strategy,
o (13) financial plan, and
o (14) appendix of supporting documents.
6-5. Offer practical advice on writing a business plan.
• Analyze the market thoroughly.
• Provide solid evidence for any claims.
• Understand how investors think.
• Don’t hide weaknesses; try to identify potential fatal flaws.
• Maintain confidentiality, when appropriate.
• Pay attention to the details.
2025
QUESTIONS AND
ANSWERS
FOR ASSISTANCE CONTACT
EMAIL:
, lOMoARcPSD|31863004
CGMV
Chapter 6: The Business Plan: Visualizing the Dream
6-1. Explain the purpose and objectives of business plans .
• A business plan is a document that sets out the basic idea underlying a business and describes
related startup considerations. It should explain where the entrepreneur is presently, indicate
where he or she wants to go, and outline how he or she proposes to get there.
• business plan has three key elements:
o (1) a logical statement of a problem and its solution,
o (2) a significant amount of hard evidence, and
o (3) candor about the risks, gaps, and assumptions that might be proved wrong.
• The objectives of a business plan include assessing whether a good idea is also a good
investment opportunity, determining whether the business aligns with your personal goals,
providing direction for insiders, and convincing outsiders to enter into a relationship with the
company.
6-2. Give the rationale for writing (or not writing) a business plan when starting a new venture.
• Studies attempting to measure whether entrepreneurs who have business plans do better than
those who don’t have produced mixed results. Some findings suggest a relationship; others do
not.
• What ultimately matters is not writing a plan, but implementing it. The goal is to execute the
plan.
• An entrepreneur must find the right balance between planning and becoming operational.
• For some startups, excessive planning isn’t beneficial because the environment is too turbulent,
fast action is needed to take advantage of an opportunity, or there’s a shortage of capital.
• Most entrepreneurs need the discipline that comes with writing a business plan. A written plan
helps to ensure systematic, complete coverage of the important factors to be considered in
starting a new business.
• A business plan helps an entrepreneur communicate his or her vision to current and prospective
employees of the business.
• By enhancing the business’s credibility, a business plan serves as an effective selling tool with
prospective customers and suppliers, as well as investors.
• A short (dehydrated) plan is an abbreviated form of a traditional business plan that presents
only the most important issues and projections for the business.
• A comprehensive plan is a complete business plan that provides an in-depth analysis of the
critical factors that will determine a business’s success or failure, along with the underlying
assumptions.
, lOMoARcPSD|31863004
CGMV
6-3. Explain the concept and process for developing a business model.
• The term business model has become a popular phrase in business, especially among
entrepreneurs and their investors.
• The business model measures the anticipated results of the core business decisions and all the
trade-offs that determine a company’s profits and cash flows.
• Understanding the business model is especially important in a startup, where there is so much
uncertainty.
• A business model explains in a systematic and clear way how a business will generate profits and
cash flows, given its revenue sources, its cost structures, the required size of investment, and its
sources of risk.
, lOMoARcPSD|31863004
CGMV
6-4. Describe the preferred content and format for a business plan.
• The opportunity, the critical resources, the entrepreneurial team, the financing structure, and
the context of an opportunity are all interdependent factors that should be given consideration
when thinking about the content of a business plan.
• Key sections of a business plan are the
o (1) cover page,
o (2) table of contents,
o (3) executive summary (overview),
o (4) company description,
o (5) industry, target customer, and competitor analysis,
o (6) product/service plan,
o (7) marketing plan,
o (8) operations and development plan,
o (9) management team,
o (10) critical risks,
o (11) offering,
o (12) exit strategy,
o (13) financial plan, and
o (14) appendix of supporting documents.
6-5. Offer practical advice on writing a business plan.
• Analyze the market thoroughly.
• Provide solid evidence for any claims.
• Understand how investors think.
• Don’t hide weaknesses; try to identify potential fatal flaws.
• Maintain confidentiality, when appropriate.
• Pay attention to the details.
