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BAEP 301 Midterm Questions and Correct
Answers
non-profit Ans: An organization, very like a business, that does
not generate returns for its investors. It may run off donations as
well as revenue, but all profits are returned to its mission.
Small Business Administration Ans: A U.S. government agency
that provides support services for small businesses, included loan
assistance and guarantees
Business Model Ans: A description of how a business operates
with emphasis on how it engages customers, produces its product,
makes a profit and generates returns on investment.
Angel Investor Ans: An investor or small group that funds early
phase startup businesses with the capital they need for early
growth, usually in the range of hundreds of thousands of dollars.
Most large startups start with Angel Investment
Venture Capital Ans: A sophisticated investor that makes large
investments in startups, with the hope of occasionally finding a
big hit. VCs typically look for firms with potential markets
measured in $billions of dollars and make investments of
$5million and more
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Organic Growth Ans: Growing a firm with money from its own
profit stream.
Lifestyle Business Ans: A business designed to support the
lifestyle of the entrepreneur.
Fusion Firm Ans: A firm that combines more than one basic type
of firm into its model
Shifters Ans: A firm that moves from one type of firm to another.
For instance, a firm started as a lifestyle project could find a
product with huge potential and shift into a scalable startup mode.
Loan Defaults Ans: The failure of a firm to meet its payment
obligations on a loan.
Charged Off Loan Ans: A loan that a lender has given up on
collecting.
Due Diligence Ans: The research work an investor does about a
firm and its potential, in order to insure they are making a wise
investment.
Logistics Ans: The actual work involved in managing the
resources (usually physical) in your business operations. Shipping,
storing, processing and delivering.
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Startup Costs Ans: The money need to get the business off the
ground and usually designed to help it reach the point where it is
stable.
Barriers to Entry Ans: The obstacles which prevent new
businesses from entering a market.
Serial Entrepreneur Ans: An individual who launches many
businesses, one after another.
Parallel Entrepreneur Ans: An individual who launches many
businesses at the same time.
Developed World Ans: Countries with sophisticated economies
and high standards of living such as the United States, Japan and
Europe.
Offshoring Ans: The practice of moving production, usually
manufacturing or software development to another country with a
cheaper labor rate
Automated Ans: A process done by technology such as robots.
Part-time entrepreneurship Ans: Running a business as a sideline,
while working a full time job.
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Direct Sales Ans: When a business sells its products directly to
the consumer rather than through intermediaries such as
distributors or retailers; often, through the Internet.
State-Owned Enterprises Ans: A business primarily owned or
controlled by a government. The United States Postal Service, for
example.
Sunk Cost Fallacy Ans: A misguided focus on investments that
have been previously made into a project, rather than on its
immediate potential for success. Sunk Costs often compel
entrepreneurs to keep working on doomed efforts and investors to
"put good money after bad."
Oppourtunity Cost Ans: The value of something that must be
sacrificed in exchange for pursing a venture. If you choose to work
full time on your startup, your opportunity costs include the
money you might have earned in a regular job.
Agency Ans: The conflict between the personal motivations of an
individual and those of his employer.
Bucket List Ans: The list of achievements one would like to
accomplish in their life.
© 2025 All rights reserved
BAEP 301 Midterm Questions and Correct
Answers
non-profit Ans: An organization, very like a business, that does
not generate returns for its investors. It may run off donations as
well as revenue, but all profits are returned to its mission.
Small Business Administration Ans: A U.S. government agency
that provides support services for small businesses, included loan
assistance and guarantees
Business Model Ans: A description of how a business operates
with emphasis on how it engages customers, produces its product,
makes a profit and generates returns on investment.
Angel Investor Ans: An investor or small group that funds early
phase startup businesses with the capital they need for early
growth, usually in the range of hundreds of thousands of dollars.
Most large startups start with Angel Investment
Venture Capital Ans: A sophisticated investor that makes large
investments in startups, with the hope of occasionally finding a
big hit. VCs typically look for firms with potential markets
measured in $billions of dollars and make investments of
$5million and more
© 2025 All rights reserved
, 2 | Page
Organic Growth Ans: Growing a firm with money from its own
profit stream.
Lifestyle Business Ans: A business designed to support the
lifestyle of the entrepreneur.
Fusion Firm Ans: A firm that combines more than one basic type
of firm into its model
Shifters Ans: A firm that moves from one type of firm to another.
For instance, a firm started as a lifestyle project could find a
product with huge potential and shift into a scalable startup mode.
Loan Defaults Ans: The failure of a firm to meet its payment
obligations on a loan.
Charged Off Loan Ans: A loan that a lender has given up on
collecting.
Due Diligence Ans: The research work an investor does about a
firm and its potential, in order to insure they are making a wise
investment.
Logistics Ans: The actual work involved in managing the
resources (usually physical) in your business operations. Shipping,
storing, processing and delivering.
© 2025 All rights reserved
, 3 | Page
Startup Costs Ans: The money need to get the business off the
ground and usually designed to help it reach the point where it is
stable.
Barriers to Entry Ans: The obstacles which prevent new
businesses from entering a market.
Serial Entrepreneur Ans: An individual who launches many
businesses, one after another.
Parallel Entrepreneur Ans: An individual who launches many
businesses at the same time.
Developed World Ans: Countries with sophisticated economies
and high standards of living such as the United States, Japan and
Europe.
Offshoring Ans: The practice of moving production, usually
manufacturing or software development to another country with a
cheaper labor rate
Automated Ans: A process done by technology such as robots.
Part-time entrepreneurship Ans: Running a business as a sideline,
while working a full time job.
© 2025 All rights reserved
, 4 | Page
Direct Sales Ans: When a business sells its products directly to
the consumer rather than through intermediaries such as
distributors or retailers; often, through the Internet.
State-Owned Enterprises Ans: A business primarily owned or
controlled by a government. The United States Postal Service, for
example.
Sunk Cost Fallacy Ans: A misguided focus on investments that
have been previously made into a project, rather than on its
immediate potential for success. Sunk Costs often compel
entrepreneurs to keep working on doomed efforts and investors to
"put good money after bad."
Oppourtunity Cost Ans: The value of something that must be
sacrificed in exchange for pursing a venture. If you choose to work
full time on your startup, your opportunity costs include the
money you might have earned in a regular job.
Agency Ans: The conflict between the personal motivations of an
individual and those of his employer.
Bucket List Ans: The list of achievements one would like to
accomplish in their life.
© 2025 All rights reserved
