Small Business Management Exam 1 Questions With Correct Answers

A small business is one that is? - Answer Activity managed by the owners Highly personalized Largely local in it's area of operations Largely dependent on enternal sources of capital. Independently owned and operated and does not donate the field of operation. A successful going concern has demonstrated? - Answer An ability to attract customers. Can control cost. Can make a profit. Has a track record under actual marketing conditions. Causes of business failure? - Answer External Problems: Human Resource Planning Capital Shortages- Lack of available money. Tax Burdens Government regulations Consumerism Internal Problems: Lack of expertise Financial Shortages Human resource management Economic contributions of small business in the U.S.? - Answer Interdependence of business-small business are essential to enable a few large ones to concentrate on those economic activities where their efforts are more effective. S.B. creates 52% of all private employment and 51% of the nations total output of goods & services (as of 2002). Stimulating economic competition Innovation Intangible and Tangible asset - Answer Intangible: is a type of asset that is not able to be physically touched but retained by a small business. Tangible:Physical asset that possess ginuine value. Long range planning - Answer Over 10 years Intermediate planning - Answer 2-9 Years Short-term planning - Answer 1 year or less Major source of new ideas come from? - Answer Innovation Management Activities - Answer 1. planning - selection ordering of tasks to achieve goals 2. organizing - assign/coordination of tasks, resources to perform tasks 3. motivating - goal directing force - organize - give director to tension caused by unsatisfied need 4. directing - process - motivation leading and influencing activities of subordinate 5. controlling - collecting, evaluating, comparison of information in order to correct improper performance Management Skills - Answer 1. technical skills - these are the abilities necessary to carry out specific tasks that have been assigned 2. human skills - the ability to work with, motivate, and direct individuals for to a common goal 3. conceptual skills - ability to understand the degree of complexity in a given situation and to reduce that complexity to a level at which specific course of action can be determined