Midterm answers .docx

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1. Why would anyone want to start a new business? a. Be your own boss b. Pursue your own ideas c. Financial rewards i. Replicative vs. innovative entrepreneurs ii. Pure vs. hybrid entrepreneurs d. Contribute to society i. Nonprofits 2. What are the main differences between a for-profit and a not-for-profit business? a. Profit Objective and Business Operation i. A nonprofit is an organization that needs a fund balance to survive. Like a for-profit business, nonprofits must strategically plan for the future, spend their money wisely, market their goods and services, and manage efficiently and effectively. Like for-profits, nonprofits need to hire and pay employees with entrepreneurial behavior skills in order to better solve social problems. b. Entrepreneurial Orientation (EO) i. Nonprofits, like for-profits, are in need of an entrepreneurial orientation. Nonprofits seek entrepreneurial behavior from their paid and volunteer employees, such as innovating ways to achieve the mission by increasing efficiencies, serving more clients, or enhancing what is done for clients. Proactiveness is needed to find new ways of generating sources of revenue needed for survival and growth of the nonprofit. Risk-taking is required to start and operate a nonprofit. 3. What economic data supports the fact that family businesses play a prominent role in entrepreneurship? a. Within the U.S. economy, family businesses comprise an estimated 80 to 90 percent of the businesses, contribute more than 50 percent of the total Gross National Product, employ 50 percent of the work force, and about one-third of all Fortune 500 firms are family controlled. 4. Can entrepreneurship be taught and learned? a. Researchers are studying formal education and entrepreneurship thinking, and find that knowledge and learning are the foundations of entrepreneurship. Knowledge is a main source of competitive advantage, so research supports that entrepreneurship can be taught and learned. 5. Why are entrepreneurs drivers of social change? a. Entrepreneurs are drivers of social change, and they create a better world. Entrepreneurship and innovation are fundamental drivers of economic growth and wealth creation. Today’s entrepreneurs are looking for international opportunities, and international entrepreneurs are fueling global growth. Even though small firms have a risk of failure, the risk doesn't increase with crossborder sales; in fact international sales are associated with better survival prospects. 6. What questions do you need to ask about starting a new venture? a. Do I really want to be an entrepreneur?
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b. What option should I take to become a entreprenuer? c. What business do I want to start? d. What are my chances of success? 7. Can people be trained to think more creatively?
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