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Chapter 3Starting a Small Business TRUE/FALSE 1. "Me, too" strategies are used by very few new ventures. ANS: F In reality, most new ventures (especially in service industries) are founded on "me, too" strategies. PTS: 1 REF: p. 72 OBJ: 3-1 TYPE: C NAT: Analytic | Value Creation 2. Many new businesses are formed from an entrepreneur seeing ways to improve or modify a product as a result of previous work experience. ANS: T PTS: 1 REF: p. 72 OBJ: 3-1 TYPE: C NAT: Analytic | Value Creation 3. Based on knowledge gleaned from a present or recent job, entrepreneurs may see new startup ideas from modifying an existing product, improving a service, or duplicating a business concept in a differ- ent location. ANS: T PTS: 1 REF: p. 73 OBJ: 3-1 TYPE: C NAT: Analytic | Value Creation 4. Hobbies or personal interests can provide startup ideas. ANS: T PTS: 1 REF: p. 74 OBJ: 3-1 TYPE: C NAT: Analytic | Value Creation 5. Serendipity describes a new product idea resulting from deliberate search activities. ANS: F Serendipity refers to making desirable accidental discoveries, not engaging in deliberate search efforts. PTS: 1 REF: p. 74 OBJ: 3-1 TYPE: D NAT: Analytic | Value Creation 6. Serendipity is the facility for making desirable discoveries by accident. ANS: T PTS: 1 REF: p. 74 OBJ: 3-1 TYPE: D NAT: Analytic | Value Creation 7. Magazines and other periodicals are excellent sources of startup ideas. ANS: T PTS: 1 REF: p. 75 OBJ: 3-1 TYPE: C NAT: Analytic | Value Creation 8. Startups are more likely to be successful when the entrepreneur first evaluates his or her own capabilit- ies and then looks for a new product or service idea, as opposed to beginning with a need in the mar- ketplace and then relating those to personal capabilities. ANS: F Startups that are launched by first identifying market needs are more likely to be successful, especially when the business is related to consumer goods and services. PTS: 1 REF: p. 80 OBJ: 3-3 TYPE: C NAT: Analytic | Value Creation 9. Cabana Life , the company started by Melissa Marks Papock, is an example of a startup based on serendipity. ANS: F Cabana Life is an example of a startup based on personal experience. PTS: 1 REF: p. 73 OBJ: 3-1 TYPE: A NAT: Reflective Thinking | Value Creation 10. Business guru Peter Drucker believes entrepreneurs should consider no more than two or three sources of opportunity to avoid being sidetracked as they prepare to launch or grow their enterprises. ANS: F Business guru Peter Drucker believes entrepreneurs should consider seven sources of opportunity as they prepare to launch or grow their enterprises: the unexpected, the incongruous, process needs, struc- tural change, demographics, changes in perception, and new knowledge.... View Full Document

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