Chapter 6—The Business Plan: Visualizing the Dream
TRUE/FALSE
1.
A business plan is a written document that sets out the basic idea underlying a business and its related
startup considerations.
ANS:
T
PTS:
1
DIF:
Difficulty: Easy
REF:
p. 142
OBJ:
LO: 6-1
NAT:
BUSPROG: Communication
STA:
DISC: Value CreationKEY:
Bloom’s: Comprehension
2.
One of the primary functions of a business plan is to serve as a selling document to convince key
individuals that the venture has real potential.
ANS:
T
PTS:
1
DIF:
Difficulty: Moderate
REF:
p. 143
OBJ:
LO: 6-1
NAT:
BUSPROG: Communication
STA:
DISC: Dynamics
KEY:
Bloom’s: Comprehension
3.
Writing an effective plan is more important for internal purposes than for persons outside of the firm.
ANS: F
It is important for both internal and external purposes.
PTS:
1
DIF:
Difficulty: Moderate
REF:
p. 143
OBJ:
LO: 6-1
NAT:
BUSPROG: Communication
STA:
DISC: Dynamics
KEY:
Bloom’s: Comprehension
4.
A business plan is used to provide a statement of goals and strategies for use by company outsiders,
and aid in the development of relationships with insiders.
ANS: F
The plan provides goals and strategies for insiders to aid in development of relationships with
outsiders.
PTS:
1
DIF:
Difficulty: Moderate
REF:
p. 143
OBJ:
LO: 6-1
NAT:
BUSPROG: Communication
STA:
DISC: Dynamics
KEY:
Bloom’s: Comprehension
5.
A business plan should always be written before deciding to go forward with a startup business idea.
ANS: F
A business plan is not always needed as what matters is not writing a plan, but implementing it.
PTS:
1
DIF:
Difficulty: Moderate
REF:
p. 144
OBJ:
LO: 6-2a
NAT:
BUSPROG: Communication
STA:
DISC: Value Creation
KEY:
Bloom’s: Comprehension
6.
An extensive business plan that is not followed is more valuable than no business plan at all.
ANS: F
The purpose of the plan is to cause action not write a plan.
PTS:
1
DIF:
Difficulty: Moderate
REF:
p. 144
OBJ:
LO: 6-2a
NAT:
BUSPROG: Communication
STA:
DISC: Value Creation
KEY:
Bloom’s: Comprehension
7.
Time and money are factors that affect the extent of business plan preparation.
ANS:
T
PTS:
1
DIF:
Difficulty: Easy
REF:
p. 145
OBJ:
LO: 6-2a
NAT:
BUSPROG: Communication
STA:
DISC: Value CreationKEY:
Bloom’s: Comprehension
8.
Once the decision is made to prepare a business plan, it should always be a comprehensive plan.
ANS: F
A dehydrated plan is best for situations of high uncertainty in the environment or when timing is
critical to take advantage of a new opportunity.
PTS:
1
DIF:
Difficulty: Easy
REF:
p. 145-146
OBJ:
LO: 6-2b
NAT:
BUSPROG: Communication
STA:
DISC: Value Creation
KEY:
Bloom’s: Comprehension
9.
A written business plan helps to ensure systematic, complete coverage of the important factors to be
considered in starting a new business.
ANS:
T
PTS:
1
DIF:
Difficulty: Easy
REF:
p. 146-147
OBJ:
LO: 6-3
NAT:
BUSPROG: Communication
STA:
DISC: Value CreationKEY:
Bloom’s: Comprehension
10.
The executive summary of a business plan presents a firm's history and its form of organization.
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- Spring '17
- lorid bradshaw
- Business, Management
