ENTREPRENEURIAL FINANCE UPDATED ACTUAL
QUESTIONS AND CORRECT ANSWERS
◉ 2. An initial public offering provides a venture with a source of
bridge financing.
Answer: false
◉ One principle of entrepreneurial finance is "risk and expected
reward go hand in hand."
Answer: true
◉ 4. Entrepreneurial opportunities can occur only when there are
societal changes in the world.
Answer: false
◉ 5. The entrepreneurial process involves: developing
opportunities, gathering resources, and managing and building
operations, all with the goal of creating value.
Answer: true
◉ 6. Technological change may be the most important source of
entrepreneurial opportunities.
Answer: true
,◉ 7. "Crises and "'bubbles'" and "emerging economies and global
change" are considered to be sources of entrepreneurial
opportunities.
Answer: true
◉ 8. An entrepreneur is an individual who thinks, reasons, and acts
to convert ideas into commercial opportunities and to create value.
Answer: true
◉ 9. The sharing economy is a(n):
Answer: a. developing societal megatrend
◉ 10. Which of the following statements is correct?
Answer: b. the early-maturity stage is the final stage of a new
venture's life cycle
◉ 11. Founder and venture investor shares that are sold to the
public after the initial public offering to the public is called a:
Answer: b. secondary stock offering
◉ 12. The goal of the entrepreneurial process is to:
Answer: d. create value
,◉ 13. The last three stages of a successful venture's life cycle occur
in the following order:
Answer: c. survival, rapid-growth, early-maturity
◉ 14. The type of financing that occurs during the development
stage of a venture's life cycle is typically referred to as:
Answer: a. seed financing
◉ 15. Which stage in the venture life cycle is characterized by
creating and building value, obtaining additional financing, and
examining opportunities?
Answer: c. rapid-growth stage
◉ 16. Which of the following is not a source of entrepreneurial
opportunities referred to in this textbook?
Answer: b. political changes
◉ 17. Obtaining bank loans, issuing bonds, and issuing stock is
characteristic of which type of financing during a venture's life cycle
Answer: d. seasoned financing
◉ 18. Mezzanine financing is associated with which of the following
life cycle stages?
, Answer: d. rapid-growth stage
◉ 19. The first component of a sound business model is the need to
generate revenues.
Answer: true
◉ 20. A sound business model should provide a plan to generate
revenues, make profits, and produce free cash flows.
Answer: true
◉ 21. A sound business model is a plan to generate investor interest,
make profits, and grow asset investments.
Answer: false
◉ 22. A SWOT analysis is an examination of the strengths,
weaknesses, opportunities, and threats to determine the business
opportunity viability of an idea.
Answer: true
◉ 23. Best practices of high-growth, high-performance firms applied
in the marketing practices area include "developing new products or
services that are considered to be the best."
Answer: true
QUESTIONS AND CORRECT ANSWERS
◉ 2. An initial public offering provides a venture with a source of
bridge financing.
Answer: false
◉ One principle of entrepreneurial finance is "risk and expected
reward go hand in hand."
Answer: true
◉ 4. Entrepreneurial opportunities can occur only when there are
societal changes in the world.
Answer: false
◉ 5. The entrepreneurial process involves: developing
opportunities, gathering resources, and managing and building
operations, all with the goal of creating value.
Answer: true
◉ 6. Technological change may be the most important source of
entrepreneurial opportunities.
Answer: true
,◉ 7. "Crises and "'bubbles'" and "emerging economies and global
change" are considered to be sources of entrepreneurial
opportunities.
Answer: true
◉ 8. An entrepreneur is an individual who thinks, reasons, and acts
to convert ideas into commercial opportunities and to create value.
Answer: true
◉ 9. The sharing economy is a(n):
Answer: a. developing societal megatrend
◉ 10. Which of the following statements is correct?
Answer: b. the early-maturity stage is the final stage of a new
venture's life cycle
◉ 11. Founder and venture investor shares that are sold to the
public after the initial public offering to the public is called a:
Answer: b. secondary stock offering
◉ 12. The goal of the entrepreneurial process is to:
Answer: d. create value
,◉ 13. The last three stages of a successful venture's life cycle occur
in the following order:
Answer: c. survival, rapid-growth, early-maturity
◉ 14. The type of financing that occurs during the development
stage of a venture's life cycle is typically referred to as:
Answer: a. seed financing
◉ 15. Which stage in the venture life cycle is characterized by
creating and building value, obtaining additional financing, and
examining opportunities?
Answer: c. rapid-growth stage
◉ 16. Which of the following is not a source of entrepreneurial
opportunities referred to in this textbook?
Answer: b. political changes
◉ 17. Obtaining bank loans, issuing bonds, and issuing stock is
characteristic of which type of financing during a venture's life cycle
Answer: d. seasoned financing
◉ 18. Mezzanine financing is associated with which of the following
life cycle stages?
, Answer: d. rapid-growth stage
◉ 19. The first component of a sound business model is the need to
generate revenues.
Answer: true
◉ 20. A sound business model should provide a plan to generate
revenues, make profits, and produce free cash flows.
Answer: true
◉ 21. A sound business model is a plan to generate investor interest,
make profits, and grow asset investments.
Answer: false
◉ 22. A SWOT analysis is an examination of the strengths,
weaknesses, opportunities, and threats to determine the business
opportunity viability of an idea.
Answer: true
◉ 23. Best practices of high-growth, high-performance firms applied
in the marketing practices area include "developing new products or
services that are considered to be the best."
Answer: true
