Business in Action Chapter 6 Exam
Questions and Complete Solutions
Graded A+
small business - Answer: A company that is independently owned and operated, is not dominant in its
field, and employs fewer than 500 people (although this number varies by industry).
entrepreneurial spirit - Answer: The positive, forward-thinking desire to create profitable, sustainable
business enterprises.
business plan - Answer: A document that summarizes a proposed business venture, its goals, and plans
for achieving those goals.
advisory board - Answer: A team of people with subject-area expertise or vital contacts who help a
business owner review plans and decisions.
business incubators - Answer: Facilities that house small businesses and provide support services during
the company's early growth phases.
seed money - Answer: The first infusion of capital used to get a business started.
microlenders - Answer: Organizations, often not-for-profit, that lend smaller amounts of money to
business owners who might not qualify for conventional bank loans.
venture capitalists - Answer: Investors who provide money to finance new businesses or turnarounds in
exchange for a portion of ownership, with the objective of reselling the business at a profit.
angel investors - Answer: Private individuals who invest money in start-ups, usually earlier in a business's
life and in smaller amounts that VCs are willing to invest or banks are willing to lend.
initial public offering - Answer: A corporation's first offering of shares to the public.
Questions and Complete Solutions
Graded A+
small business - Answer: A company that is independently owned and operated, is not dominant in its
field, and employs fewer than 500 people (although this number varies by industry).
entrepreneurial spirit - Answer: The positive, forward-thinking desire to create profitable, sustainable
business enterprises.
business plan - Answer: A document that summarizes a proposed business venture, its goals, and plans
for achieving those goals.
advisory board - Answer: A team of people with subject-area expertise or vital contacts who help a
business owner review plans and decisions.
business incubators - Answer: Facilities that house small businesses and provide support services during
the company's early growth phases.
seed money - Answer: The first infusion of capital used to get a business started.
microlenders - Answer: Organizations, often not-for-profit, that lend smaller amounts of money to
business owners who might not qualify for conventional bank loans.
venture capitalists - Answer: Investors who provide money to finance new businesses or turnarounds in
exchange for a portion of ownership, with the objective of reselling the business at a profit.
angel investors - Answer: Private individuals who invest money in start-ups, usually earlier in a business's
life and in smaller amounts that VCs are willing to invest or banks are willing to lend.
initial public offering - Answer: A corporation's first offering of shares to the public.
