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Chapter 9The Location Plan TRUE/FALSE 1. States establish enterprise zones in order to locate businesses where they can take advantage of the ser- vices of other businesses located in the same general area. ANS: F States establish enterprise zones in order to bring jobs to economically deprived areas. PTS: 1 REF: p. 267 OBJ: 9-1 TYPE: D NAT: Analytic | Ethical and Legal 2. A brick-and-mortar store is actually a general term that refers a retail outlet dealing in building sup- plies. ANS: F A brick-and-mortar store is the traditional physical store from which often operate. PTS: 1 REF: p. 262 OBJ: 9-1 TYPE: D NAT: Analytic | Value Creation 3. Enterprise zones are sponsored by local city or county governments. ANS: F These zones are state-designated areas. PTS: 1 REF: p. 267 OBJ: 9-1 TYPE: D NAT: Analytic | Ethical and Legal 4. Sometimes an attorney can insert special clauses into a lease agreement that will allow the lessee to exit the agreement under certain circumstances. ANS: T PTS: 1 REF: p. 270 OBJ: 9-1 TYPE: C NAT: Analytic | Ethical and Legal 5. Recent observations have shown that most businesses are started in a new building. ANS: F In reality, new businesses are typically started in an existing building with major or minor remodeling. PTS: 1 REF: p. 271 OBJ: 9-2 TYPE: C NAT: Analytic | Value Creation 6. For many entrepreneurs, choosing a location for a small business is a one-time decisionmade only when the business is first established or purchased. ANS: T PTS: 1 REF: p. 262 OBJ: 9-1 TYPE: C NAT: Analytic | Value Creation 7. All other factors being equal, retail and services businesses will find little advantage in selecting a loc- ation near the center of the market. ANS: F For retail and services firms, one of the foremost considerations in selecting a location should be ac- cess to customers, so a central location would be advantageous in most cases. PTS: 1 REF: p. 264 OBJ: 9-1 TYPE: C NAT: Analytic | Value Creation 8. If the cost of shipping the finished product is high, the factory should probably be located near a source of raw materials. ANS: F Locating near a source of raw materials is important when these inputs are heavy and costly to ship, but this may not apply to the shipping of the finished products of that firm. PTS: 1 REF: p. 267 OBJ: 9-1 TYPE: C NAT: Analytic | Finance 9. Choosing to locate a business in one's home community will offer fewer advantages than disadvant- ages. ANS: F Locating a business in one's home community can offer several advantagese.g., understanding the community, establishing credit, friends as customers. PTS: 1 REF: p. 268 OBJ: 9-1 TYPE: C NAT: Analytic | Value Creation 10. Many entrepreneurs recognize the value of talking to local realtors to determine site availability and appropriateness.... View Full Document

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