MGT 241 Midterm Chapter 1

Entrepreneurs are aggressive catalysts for change within the marketplace.
True
Entrepreneurs are not heroes in today’s marketplace.
True
Entrepreneurs are the major source of innovation and job creation in any economy
True
Entrepreneurship is more than the mere creation of a business.
True
During the past ten years, new business incorporations averaged nearly 600,000 per year.
True
One of every 1,000 adults participates in the founding of a new firm every year.
False
The entrepreneurial spirit is unique to America and Western Europe.
False
A “gazelle” is a business establishment with at least 20 percent sales growth every year for five years.
True
Gazelles produce half the innovations per employee that larger firms typically do.
False
New and smaller firms obtain more patents per sale than do larger firms.
True
Gazelles produced 5 million jobs despite the continual downsizing in major corporations over the last decade.
True
New and smaller firms are responsible for 95 percent of all radical innovations.
True
Gazelles are almost always high tech.
False
Gazelles do not always get venture capital funding.
True
Three characteristics of an entrepreneur are personal initiative, management skills, and a desire for autonomy.
True
Large firms, as opposed to entrepreneurs, are the aggressive catalyst for change in the world of business.
False
The word entrepreneur is derived from the Spanish word entreprendre, meaning “to undertake.”
False
There is no single definition of an entrepreneur.
True
Recognition of entrepreneurs dates back to the French economist Richard Cantillon.
True
Entrepreneurs are the major source of innovation and job creation in the economy.
True
According to Robert C. Ronstadt, entrepreneurship is the process of creating incremental wealth.
True
Most entrepreneurs are inventors.
False
An entrepreneur needs neither a lot of money nor luck.
True
Prepared entrepreneurs who seize opportunities when they arise often appear to be lucky.
True
Entrepreneurs are high risk takers.
False
Entrepreneurs always start their business at a young age.
False
Characteristics of entrepreneurs can neither be taught nor learned.
False
Entrepreneurs are born not made.
False
Entrepreneurs are doers not thinkers.
False
Entrepreneurs must fit the “profile.”
False
Entrepreneurs are often very methodical people who plan their moves very carefully.
True
The “corridor principle” states that entrepreneurs often get stuck on one idea.
False
Entrepreneurs are often known as calculated risk takers, as opposed to “gamblers.”
True
The macro view of entrepreneurship includes external processes that are sometimes beyond the control of the entrepreneur.
True
The displacement school of thought focuses on the negative side of group phenomena.
True
The strategic formulation school of thought emphasizes the planning process in successful venture development.
True
In the environmental school of thought, legal issues surrounding the natural environment are primary.
False
The financial/capital entrepreneurial school of thought focuses on the potential profit of the business idea.
False
Political, cultural, and economic displacement are all part of the displacement school of entrepreneurial thought.
True
“Great chef” strategies focus on unique markets.
False
Entrepreneurship involves an interdisciplinary approach.
True
The four major dimensions considered in the dynamic states approach are the individual, the environment, the organization, and the process.
False
Entrepreneurs are best characterized as:
aggressive catalysts for change
During the past ten years, there were approximately how many business incorporations per year?
600,000
Entrepreneurs will always be
the major source of job creation and innovation in any economy
In the evolutionary process of economic growth, _________ plays the crucial and indispensable role of providing the “social glue” that binds together both high-tech and “Main Street” activities.
entrepreneurship
Entrepreneurs and gazelles have been credited with making disproportionate contributions to all but which of the following?
unemployment
Which of the following statements best describes a “gazelle?”
a business with at least 20 percent growth every year
Gazelles have been responsible for which of the following:
55 percent of innovations
______________ is the economic basis for all entrepreneurial activity.
Free enterprise
The word entrepreneur is derived from the French entreprendre, which is translated as
to compete
The entrepreneur is one who
manages.
Which of the following characteristics is most important to an entrepreneur?
management skills
The study of entrepreneurship is
interdisciplinary
Which economist first associated the “risk bearing” activity in the economy with the entrepreneur?
Richard Cantillon
Which is not one of the chief characteristics of an entrepreneur?
desire for control of people
Entrepreneurial traits include which of the following?
initiative
Robert C. Ronstadt put together a summary definition of entrepreneur that included which of the following key phrases?
the dynamic process of creating incremental wealth
Which of the following concepts is entrepreneurship considered synonymous with?
free enterprise
Which is a true statement about entrepreneurs?
Entrepreneurs are doers and thinkers.
Throughout the years, many myths have arisen about entrepreneurship as a result of?
a lack of research about entrepreneurship
The “corridor principle” is best described by which of the following statements?
With every new venture launched, new and unintended opportunities arise.
Which of the following traits is not that of an entrepreneur?
shyness
Which of the following is not a common myth about entrepreneurs?
Entrepreneurs today are considered heroes.
Which statement is not true?
Entrepreneurs fare poorly in today’s hypercompetitive market.
Most entrepreneurs should be categorized as
innovators
Which of the following statements is true?
Entrepreneurship is the ability to create and build a vision from practically nothing.
Which of the following economists wrote about entrepreneurship and its impact on economic development?
Joseph Schumpeter
Entrepreneurship has become synonymous or closely linked with:
free enterprise and capitalism
Michael Gerber, the author of The E-Myth, contends:
today’s business owners are not true entrepreneurs
Michael Gerber, the author of The E-Myth, explains that the failure of most small businesses is due to:
owners being more technical rather than entrepreneurial
Entrepreneurs always
generate ideas and plan for their implementation
When referring to “luck” and an entrepreneur, which of the following statements is an appropriate adage?
luck happens when preparation meets opportunity
The statement, “with every new venture launched, new and unintended opportunities often arise,” would be associated with:
the corridor principle
Entrepreneurs themselves perceive the concept of risk in which of the following ways:
calculated risk taking
In the study of contemporary entrepreneurship, one concept reoccurs:
entrepreneurship is interdisciplinary
The macro view of entrepreneurship presents factors exhibiting a strong
external locus of control
Entrepreneurs are accurately described in which way?
as calculated risk takers
3M’s Post-it notes are an example of the
corridor principle
Which of the following schools of thought is not a micro view school of thought?
the inherited business school of thought
The macro view can be broken down into which three areas?
financial/capital, strategic, and opportunity
The displacement school of thought can be divided into which three groups?
economic, cultural, and political
The micro view is divided into which three theories?
venture opportunity theory, entrepreneurial, strategic
Which of the following is not a form of displacement in the displacement school of thought?
racial
Which of the following does not apply to the strategic formulation school of thought?
unique places
Water well strategies refer to:
unique resources
Mountain gap strategies refer to:
unique markets
The process approach to entrepreneurship seeks to
model the various factors that characterize the entrepreneurial process
The dynamic states model depicts ventures as
being dependent on their environment for survival