February 21, 2017

Homework Help: Exam: 986109RR - CHOOSING YOUR BUSINESS

Posted by Anonymous on Thursday, March 7, 2013 at 5:00am.

1. The servers at Gerry Frasier's busy ice cream shop decided that putting more ice cream in the sundaes
and cones would bring back more customers. After three months, Gerry was surprised to discover that his
profit had
A. increased, although sales had dropped.
B. literally been "eaten up."
C. increased by more than 10 percent.
D. dropped, along with his costs.
2. An Internet search for information about franchise businesses will not help you find out
A. the number of hours you'll have to put in.
B. support you'll receive from the parent corporation.
C. the variety of franchise businesses available.
D. start-up costs.
3. With their flooring business now eight months old, Jesse and Ed readily admit that _______ has been
both a pro and a con in their partnership.
A. raising capital
B. shared decision making
C. legal liability
D. accurate record keeping
4. Rob, Dave, and Kelly understand the financial risks involved in starting their own brewery; that's why
they've established their business as a
A. close corporation.
B. proprietorship.
C. partnership.
D. company.
5. Once you've chosen your business and focused on your niche, the next step is to
A. research the amount of capital you'll need.
B. research the best location for your shop.
C. write your business plan.
D. establish a Web presence.
6. Your beachside inn will be ready to open next spring. To get in on the summer tourist trade, it will be
necessary to
A. offer bargain rates at first.
B. establish a strong Web presence.
C. advertise heavily in local newspapers.
D. give it an unforgettable name.
7. Gary and Wilma Johnson plan to open a bus tour business, taking people from their small city to historic
sites along the East Coast. Tours will include bus fare, hotel accommodations, breakfast, and admission to
the sites. What aspect of their research might they want to pay special attention to?
A. Inventory
B. Profit margin
C. Past trends
D. Computer software
8. Ben and Alison have decided to turn their large farmhouse into a bed-and-breakfast
business. One of the benefits they're likely to enjoy is
A. a profit margin of 15–20 percent.
B. keeping their day jobs.
C. high ratings by national organizations.
D. relaxing days at home.
9. Which one of the following types of businesses has the least amount of personal liability?
A. Close corporation
B. Corporation
C. Partnership
D. Sole proprietorship
10. The best way to find out if a particular business is a good fit for you is to
A. try the business for two years, then sell it if it's not right for you.
B. "shadow" an owner for several days to see what's really involved.
C. talk to customers to see what they expect in a service.
D. take a personality test and go with its recommendation.
11. Which of the following business entities would allow you the most personal control?
A. A restaurant with your brother as a full partner
B. A realty office with a partner, organized as a close corporation
C. A landscaping business, of which you're the sole proprietor
D. A manufacturing corporation
12. Amy, Jan, and Beth have decided to combine their talents in a business partnership.
One of the benefits they'll have over a sole ownership is
A. less personal financial liability.
B. shared resources.
C. greater individual authority.
D. less paperwork.
13. Suzanne, who started a new restaurant, set up her business as a _______ in order to keep her personal
and business finances legally separate.
A. sole proprietorship
B. company
C. close corporation
D. partnership
14. A company owned by the shareholders and based on a charter is a
A. service organization.
B. corporation.
C. small business.
D. partnership.
15. Ricardo is sure he has what it takes to succeed in the food business, but because he lacks management
experience, he wants one that will provide the most training and support. Which of these possibilities would
be his best choice?
A. Subway
B. Ricardo's Café
C. Old MacDonald's Bed and Breakfast
D. Fuzzy's Tavern
16. To find out as much as you can about the market for your potential business, be sure to talk to
A. potential employees.
B. anyone who may compete with you locally.
C. potential customers.
D. the local bookstore owner.
17. If teamwork and support are high on your priority list, a _______ may be a poor choice for a business.
A. corporation.
B. sole proprietorship.
C. partnership.
D. close corporation.
18. What is a good way to find a business idea that'll put your talents and interests to the best use?
A. Purchase a franchise that needs to follow strict corporate guidelines.
B. Buy a local business that has been around a long time.
C. Search the Internet or the Yellow Pages for information on related subjects.
D. Open a business with a high profit margin.
End of exam
19. Which one of the following may be the least valuable source of advice when you're researching the
market for your new business?
A. Local attorneys who specialize in business law
B. Small Business Administration
C. Online attorneys who offer 24/7 Web site service
D. Other business owners with similar businesses
20. Now that you've chosen your business and found your niche, you're in need of some advice on the
practical aspects of setting up the business. A reliable resource for business information is
A. the Small Business Administration.
B. a friend who has a business.
C. Web sites offering free legal advice.
D. online business chat rooms.

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