BUSINESS INTRO: Chapter 7 - Key Terms and Questions
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18 terms
Terms | Definitions |
|---|---|
 entrepreneurs | people who risk their time, money, and other resources to start and manage a business |
| internal locus of control | a deep-seated sense that the individual is personally responsible for what happens in his or her life |
| external locus of control | a deep-seated sense that forces other than the individual are responsible for what happens in his or her life |
| market niche | small segment of a market with fewer competitors than the market as a whole. Quite attractive to small firms. |
| small business administration (SBA) | an agency of the federal government designed to maintain and strengthen the nation's economy by aiding, counseling, assisting and protecting the interests of small businesses |
| small business development centers (SBDCs) | local offices - affiliated with the Small Business Administration - that provide comprehensive management assistance to current and prospective small business owners |
| business plan | a formal document that describes a business concept, outlines core business objectives, and details strategies and timelines for achieving those objectives |
| angel investors | individuals who invest in start-up companies with high growth potential in exchange for a share of ownership |
| venture capital firms | companies that invest in start-up businesses with high growth potential in exchange for a share of ownership |
| 1) Greater financial success 2) Independence 3) Flexibility 4) Challenge 5) Survival | What are the key reasons that people launch small businesses? |
| 1) Entrepreneurs aim to dominate their industry 2) Vision, Self-reliance, energy, Confidence, tolerance of uncertainty, Tolerance of failure | What is the entrepreneur mindset? What are the entrepreneurial characteristics? |
| 1) Market niches, Personal customer service, Lower overhead costs, Technology | What are the opportunities that small businesses offer? |
| 1) High risk of failure 2) Lack of knowledge and experience 3) Too little money 4) Bigger regulatory burden 5) Higher health insurance costs | What are some threats that small businesses face? |
| 1) starting from scratch 2) buying an established business 3) Buying a franchise | What are some ways to become a new business owner? |
| 1) Gain experience 2)Learn from others 3)Educate yourself 4)Access SBA resources 5)Develop a plan | What are some strategies for success when starting a new business? |
| 1) The personal resources of the founder 2) bank loans, angel investors, venture capital firms | How are the vast majority of new firms funded? What are some other key funding sources? |
| 1) generate more than half of the U.S. gross domestic product 2) Account for 60 to 80% of all new jobs over past decade 3) Small businesses contribute innovations at twice rate of big business 4) Offer opportunities in inner city economies 5) One out of ten start a business each year 6) Entrepreneurship ranges dramatically from country to country | Explain the size, scope, and economic contributions of small business. |
| 1) Per Capita Income 2) Opportunity costs 3) Cultural/Political environment | What are the three key factors that determine the entrepreneurial rate in different countries? |
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