Entrepreneurship: Successfully Launching New Ventures, 3e (Barringer/Ireland)
Chapter 1 Introduction to Entrepreneurship
1) Klimit, the company profiled in the opening feature for Chapter 1, plans to make money on
the ski jackets and other apparel products that will use its proprietary technology by:
A) manufacturing the products and selling them via catalogues and the Internet
B) manufacturing the products and selling through large retailers like Gap and Old Navy
C) franchising
D) manufacturing the products and selling them through ski shops and other specialty stores
E) licensing its technology to outdoor gear and apparel companies
Answer: E
Diff: 1 Page Ref: 4
Topic: Introduction to Entrepreneurship
2) According to the Global Entrepreneurship Monitor (GEM) 2007 study, about ________ of
adults in the United States are either starting a business or are running a business that has been in
existence for less than 3 1/2 years.
A) 3.8 percent
B) 7.5 percent
C) 9.6 percent
D) 12.0 percent
E) 15.2 percent
Answer: C
Diff: 2 Page Ref: 5
Topic: Introduction to Entrepreneurship
3) According to the Global Entrepreneurship Monitor (GEM) 2007 study, the majority of people
in high-income countries are drawn to entrepreneurship for the following reasons:
A) to take advantage of an attractive opportunity, to pursue independence, and to increase their
incomes
B) lack of career prospects, government incentives, and to increase their incomes
C) lack of promotional opportunities in their jobs, to pursue independence, and government
incentives
D) to pursue a personal interest, lack of promotional opportunities in their jobs, and to increase
their incomes
E) to take advantage of an attractive opportunity, lack of career prospects, and government
incentives
Answer: A
Diff: 2 Page Ref: 5
Topic: Introduction to Entrepreneurship
1
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
,4) Which of the following statements regarding business success (or failure) rates is correct?
A) 9 out of 10 businesses fail within the first four years.
B) After four years, 50 percent of new businesses are still open.
C) After four years, 25 percent of new businesses are still open.
D) 2 out of 3 businesses fail within the first four years.
E) After four years, 10 percent of new businesses are still open.
Answer: B
Diff: 3 Page Ref: 5
Topic: Introduction to Entrepreneurship
5) Starbucks is a firm that is proactive, innovative and risk-taking. From this description, we can
most accurately conclude that Starbucks has a high level of:
A) inventive zeal
B) innovative intensity
C) entrepreneurial intensity
D) creative intensity
E) general zeal
Answer: C
Diff: 2 Page Ref: 6
Topic: Introduction to Entrepreneurship
AACSB: Analytic Skills
6) Jim Brill is the founder of a company named Extreme Sports Supreme. The company makes
products for extreme sports enthusiasts such as BMX bikers, hang gliders, parasailers, and
surfers. Jim wants his company to pursue a high level of corporate entrepreneurship. To achieve
that goal, Jim's firm should be:
A) innovative, risk averse, and take a "wait and see" posture
B) take a "wait and see" posture, innovative, and risk taking
C) proactive, not innovative, and risk taking
D) take a "wait and see" posture, not innovative, and risk averse
E) proactive, innovative, and risk taking
Answer: E
Diff: 2 Page Ref: 7
Topic: Introduction to Entrepreneurship
AACSB: Reflective Thinking
7) Google is an established firm that encourages and emphasizes entrepreneurial behavior
throughout its various divisions. According to the textbook, Google practices:
A) commercial entrepreneurship
B) corporate entrepreneurship
C) deliberate entrepreneurship
D) business entrepreneurship
E) innovative entrepreneurship
Answer: B
Diff: 2 Page Ref: 7
Topic: Introduction to Entrepreneurship
2
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
,8) The three primary reasons that people become entrepreneurs and start their own firms are to:
A) pursue their own ideas, realize financial rewards, and eliminate risk in their lives
B) do what they were "born" to do, be their own boss, and capture more of the spotlight
C) take big risks, be their own boss, and do what they were "born" to do
D) be their own boss, pursue their own ideas, and realize financial rewards
E) capture more of the spotlight, pursue their own ideas, and take big risks
Answer: D
Diff: 2 Page Ref: 8
Topic: Introduction to Entrepreneurship
9) According to the textbook, the number one reason that people become entrepreneurs is to:
A) realize financial rewards
B) reduce the risk in their lives
C) be their own boss
D) capture more of the spotlight
E) pursue their own ideas
Answer: C
Diff: 1 Page Ref: 8
Topic: Introduction to Entrepreneurship
10) Kate Saunders is starting a firm in the fashion industry primarily to pursue financial rewards.
According to the textbook, starting a business to make a lot of money:
A) often fails to live up to its hype
B) is equally as satisfying as other reasons for starting a business
C) is the number one reason people start their own business
D) is the number two reason that people start their own business, right behind the lack of better
career prospects
E) does not rank among the top three reasons that people start their own business
Answer: A
Diff: 2 Page Ref: 9
Topic: Introduction to Entrepreneurship
AACSB: Reflective Thinking
11) According to the textbook, the four characteristics of successful entrepreneurs are:
A) passion for the business, is on the cutting edge of technological change, is very charismatic,
and tenacity despite failure
B) is young and energetic, passion for the business, product/customer focus, and seeks
recognition
C) passion for the business, tenacity despite failure, product/customer focus, and execution
intelligence
D) is on the cutting edge of technological change, is forward thinking, tenacity despite failure,
and product/customer focus
E) passion for the business, seeks recognition, is young and energetic, and execution intelligence
Answer: C
Diff: 3 Page Ref: 9
Topic: Introduction to Entrepreneurship
3
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
, 12) The number one characteristic shared by successful entrepreneurs is:
A) a charismatic personality
B) passion for the business
C) a desire to employ other people
D) a desire to fulfill a lifetime dream
E) being on the cutting edge of technological change
Answer: B
Diff: 2 Page Ref: 9
Topic: Introduction to Entrepreneurship
13) Kendall Toms recently launched a medical startup. He is very excited about the business
because he strongly believes that the products his firm is working on will make a positive
differences in peoples' lives. Kendall's excitement results from which of the following
characteristics of entrepreneurs?
A) passion for the business
B) tenacity despite failure
C) desire to be his own boss
D) desire to be on the cutting edge of technological change
E) desire to gain financial rewards
Answer: A
Diff: 2 Page Ref: 9
Topic: Introduction to Entrepreneurship
AACSB: Analytic Skills
14) The What Went Wrong? feature in Chapter 1 focuses on ProtectMyPhotos, a company that
was launched in 2006 but eventually went out of business. According to the feature, the business
failed primarily as a result of:
A) a loss of passion for the business idea
B) poor execution
C) a lack of tenacity on the part of the founders
D) a lack of funding
E) a lack of managerial expertise
Answer: A
Diff: 1 Page Ref: 11
Topic: Introduction to Entrepreneurship
AACSB: Reflective Thinking
4
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter 1 Introduction to Entrepreneurship
1) Klimit, the company profiled in the opening feature for Chapter 1, plans to make money on
the ski jackets and other apparel products that will use its proprietary technology by:
A) manufacturing the products and selling them via catalogues and the Internet
B) manufacturing the products and selling through large retailers like Gap and Old Navy
C) franchising
D) manufacturing the products and selling them through ski shops and other specialty stores
E) licensing its technology to outdoor gear and apparel companies
Answer: E
Diff: 1 Page Ref: 4
Topic: Introduction to Entrepreneurship
2) According to the Global Entrepreneurship Monitor (GEM) 2007 study, about ________ of
adults in the United States are either starting a business or are running a business that has been in
existence for less than 3 1/2 years.
A) 3.8 percent
B) 7.5 percent
C) 9.6 percent
D) 12.0 percent
E) 15.2 percent
Answer: C
Diff: 2 Page Ref: 5
Topic: Introduction to Entrepreneurship
3) According to the Global Entrepreneurship Monitor (GEM) 2007 study, the majority of people
in high-income countries are drawn to entrepreneurship for the following reasons:
A) to take advantage of an attractive opportunity, to pursue independence, and to increase their
incomes
B) lack of career prospects, government incentives, and to increase their incomes
C) lack of promotional opportunities in their jobs, to pursue independence, and government
incentives
D) to pursue a personal interest, lack of promotional opportunities in their jobs, and to increase
their incomes
E) to take advantage of an attractive opportunity, lack of career prospects, and government
incentives
Answer: A
Diff: 2 Page Ref: 5
Topic: Introduction to Entrepreneurship
1
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
,4) Which of the following statements regarding business success (or failure) rates is correct?
A) 9 out of 10 businesses fail within the first four years.
B) After four years, 50 percent of new businesses are still open.
C) After four years, 25 percent of new businesses are still open.
D) 2 out of 3 businesses fail within the first four years.
E) After four years, 10 percent of new businesses are still open.
Answer: B
Diff: 3 Page Ref: 5
Topic: Introduction to Entrepreneurship
5) Starbucks is a firm that is proactive, innovative and risk-taking. From this description, we can
most accurately conclude that Starbucks has a high level of:
A) inventive zeal
B) innovative intensity
C) entrepreneurial intensity
D) creative intensity
E) general zeal
Answer: C
Diff: 2 Page Ref: 6
Topic: Introduction to Entrepreneurship
AACSB: Analytic Skills
6) Jim Brill is the founder of a company named Extreme Sports Supreme. The company makes
products for extreme sports enthusiasts such as BMX bikers, hang gliders, parasailers, and
surfers. Jim wants his company to pursue a high level of corporate entrepreneurship. To achieve
that goal, Jim's firm should be:
A) innovative, risk averse, and take a "wait and see" posture
B) take a "wait and see" posture, innovative, and risk taking
C) proactive, not innovative, and risk taking
D) take a "wait and see" posture, not innovative, and risk averse
E) proactive, innovative, and risk taking
Answer: E
Diff: 2 Page Ref: 7
Topic: Introduction to Entrepreneurship
AACSB: Reflective Thinking
7) Google is an established firm that encourages and emphasizes entrepreneurial behavior
throughout its various divisions. According to the textbook, Google practices:
A) commercial entrepreneurship
B) corporate entrepreneurship
C) deliberate entrepreneurship
D) business entrepreneurship
E) innovative entrepreneurship
Answer: B
Diff: 2 Page Ref: 7
Topic: Introduction to Entrepreneurship
2
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
,8) The three primary reasons that people become entrepreneurs and start their own firms are to:
A) pursue their own ideas, realize financial rewards, and eliminate risk in their lives
B) do what they were "born" to do, be their own boss, and capture more of the spotlight
C) take big risks, be their own boss, and do what they were "born" to do
D) be their own boss, pursue their own ideas, and realize financial rewards
E) capture more of the spotlight, pursue their own ideas, and take big risks
Answer: D
Diff: 2 Page Ref: 8
Topic: Introduction to Entrepreneurship
9) According to the textbook, the number one reason that people become entrepreneurs is to:
A) realize financial rewards
B) reduce the risk in their lives
C) be their own boss
D) capture more of the spotlight
E) pursue their own ideas
Answer: C
Diff: 1 Page Ref: 8
Topic: Introduction to Entrepreneurship
10) Kate Saunders is starting a firm in the fashion industry primarily to pursue financial rewards.
According to the textbook, starting a business to make a lot of money:
A) often fails to live up to its hype
B) is equally as satisfying as other reasons for starting a business
C) is the number one reason people start their own business
D) is the number two reason that people start their own business, right behind the lack of better
career prospects
E) does not rank among the top three reasons that people start their own business
Answer: A
Diff: 2 Page Ref: 9
Topic: Introduction to Entrepreneurship
AACSB: Reflective Thinking
11) According to the textbook, the four characteristics of successful entrepreneurs are:
A) passion for the business, is on the cutting edge of technological change, is very charismatic,
and tenacity despite failure
B) is young and energetic, passion for the business, product/customer focus, and seeks
recognition
C) passion for the business, tenacity despite failure, product/customer focus, and execution
intelligence
D) is on the cutting edge of technological change, is forward thinking, tenacity despite failure,
and product/customer focus
E) passion for the business, seeks recognition, is young and energetic, and execution intelligence
Answer: C
Diff: 3 Page Ref: 9
Topic: Introduction to Entrepreneurship
3
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
, 12) The number one characteristic shared by successful entrepreneurs is:
A) a charismatic personality
B) passion for the business
C) a desire to employ other people
D) a desire to fulfill a lifetime dream
E) being on the cutting edge of technological change
Answer: B
Diff: 2 Page Ref: 9
Topic: Introduction to Entrepreneurship
13) Kendall Toms recently launched a medical startup. He is very excited about the business
because he strongly believes that the products his firm is working on will make a positive
differences in peoples' lives. Kendall's excitement results from which of the following
characteristics of entrepreneurs?
A) passion for the business
B) tenacity despite failure
C) desire to be his own boss
D) desire to be on the cutting edge of technological change
E) desire to gain financial rewards
Answer: A
Diff: 2 Page Ref: 9
Topic: Introduction to Entrepreneurship
AACSB: Analytic Skills
14) The What Went Wrong? feature in Chapter 1 focuses on ProtectMyPhotos, a company that
was launched in 2006 but eventually went out of business. According to the feature, the business
failed primarily as a result of:
A) a loss of passion for the business idea
B) poor execution
C) a lack of tenacity on the part of the founders
D) a lack of funding
E) a lack of managerial expertise
Answer: A
Diff: 1 Page Ref: 11
Topic: Introduction to Entrepreneurship
AACSB: Reflective Thinking
4
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
