MGMT 275 - Chpt 10, 11, 12

Kimberly Jones is the founder of a company in the medical equipment industry. Kimberly's firm is still in the feasibility analysis stage and doesn't have a product that is ready to sell. The company is spending about $25,000 per month and expects to maintain that level of spending until it reaches profitability. The $25,000 a month is Kimberly's:
A) consumption rate
B) utilization rate
C) burn rate
D) usage rate
E) liquidity rate
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Kimberly Jones is the founder of a company in the medical equipment industry. Kimberly's firm is still in the feasibility analysis stage and doesn't have a product that is ready to sell. The company is spending about $25,000 per month and expects to maintain that level of spending until it reaches profitability. The $25,000 a month is Kimberly's:
A) consumption rate
B) utilization rate
C) burn rate
D) usage rate
E) liquidity rate
C) burn rate
The three reasons startups need funding are:
A) cash flow challenges, capital investments, and lengthy product development cycles
B) business research, cash flow challenges, and costs associated with building a brand
C) bonuses for members of the new venture team, attorney fees, and lengthy product development cycles
D) attorney fees, capital investments, and marketing research
E) bonuses for members of the new venture team, marketing research, and personnel costs
A) cash flow challenges, capital investments, and lengthy product development cycles
In startup firms, inventory must be purchased, employees must be trained and paid, and advertising must be paid for before cash is generated from sales. Which of the following reasons that motivate firms to seek funding or financing is illustrated in this example?
A) cash flow challenges
B) marketing costs
C) personnel costs
D) capital investments
E) lengthy product development cycles
A) cash flow challenges
Jason Graham's startup, which is in the electronics industry, was launched on January 1, 2009. However, prior to its formal launch, Jason spent many hours working on his business, particularly during the feasibility analysis stage. The time and effort that entrepreneurs put into their venture, that can't be easily measured from a financial point of view, is referred to as:
A) effort equity
B) intangible equity
C) sweat equity
D) worry equity
E) fret equity
C) sweat equity
Equity financing (or funding) means:
A) exchanging partial ownership in a firm, usually in the form of stock, for funding
B) getting a grant or outright gift
C) getting a loan
D) getting a lease
E) getting a loan guarantee
A) exchanging partial ownership in a firm, usually in the form of stock, for funding
Which of the following is not a source of equity funding?
A) initial public offering
B) angel investors
C) private placement
D) venture capital
E) government grants
E) government grants
Once a venture capitalist makes an investment in a firm, subsequent investments are made in rounds and are referred to as:
A) later funding
B) successive funding
C) subsequent backing
D) follow-on funding
E) ensuing backing
D) follow-on funding
An important part of obtaining venture capital funding is going through ________, which refers to the process of investigating the merits of a potential venture and verifying the key claims made by the business plan.
A) appropriate diligence
B) fit diligence
C) due diligence
D) prior diligence
E) responsible diligence
C) due diligence
In regard to the stages (or rounds) of venture capital funding, the stage of funding that occurs when an investment is made very early in a venture's life to fund the development of a prototype and feasibility analysis is referred to as:
A) seed funding
B) second-stage funding
C) first-stage funding
D) mezzanine financing
E) startup funding
A) seed funding
The main difference between the SBIR and the STTR programs is that the STTR program requires the participation of:
A) an attorney
B) a venture capitalist
C) researchers working at universities or other research institutions
D) a certified public accountant
E) a government agency in conducting the research
C) researchers working at universities or other research institutions
Which of the following statements is incorrect about grant programs? A) Granting agencies are very visible and well-known, so it's normally not hard to find one. B) The federal government has grant programs beyond the SBIR and STTR programs. C) It's important to avoid grant-related scams. D) There are a limited number of organizations that offer new businesses grants. E) There are private foundations that grant money to both existing and startup firms.A) Granting agencies are very visible and well-known, so it's normally not hard to find one.The first step in selecting a target market is to study the industry in which the firm intends to compete and determine the different potential target markets in that industry. This process is called: A) market positioning B) market splitting C) market targeting D) market subdividing E) market segmentationE) market segmentationWhich of the following is the correct sequence of events in regard to the process of selecting a target market and position strategy? A) creating a unique positioning strategy, selecting a target market, segmenting the market B) segmenting the market, creating a unique positioning strategy, selecting a target market C) segmenting the market, selecting a target market, creating a unique positioning strategy D) selecting a target market, creating a unique positioning strategy, segmenting the market E) creating a unique positioning strategy, segmenting the market, selecting a target marketC) segmenting the market, selecting a target market, creating a unique positioning strategyA(n) ________ is the set of attributes—positive or negative—that people associate with a company. A) emblem B) logo C) symbol D) brand E) trade nameD) brandWhich of the following selections is incorrect regarding a firm's "positioning" strategy? A) Position is concerned with how the firm is situated relative to its competitors. B) A firm's decision about how to position itself relative to its competitors starts with a product or service idea that is tested and refined through feasibility analysis and marketing research. C) Position is concerned with how a firm is situated relative to competitors. D) Once a firm positions itself in a certain way, it must be able to follow through with a product or service offering that lives up to the image it has created. E) After selecting a positioning strategy, the firm's next step is to select a target market.E) After selecting a positioning strategy, the firm's next step is to select a target market.Creating ________ means creating awareness and a sense of anticipation about a company and its offerings. A) ruckus B) noise C) clatter D) clamor E) buzzE) buzzWhich of the following statements is incorrect regarding the process of building a company's brand? A) A firm's name, logo, Web site design, and even its letterhead are part of its brand. B) One of the keys to effective branding is to create a strong personality for a firm. C) Some companies monitor the integrity of their brands through brand management. D) Startups must build a brand from scratch, which starts with selecting the company's name. E) Most experts recommend a heavy reliance on advertising in building a firm's brandE) Most experts recommend a heavy reliance on advertising in building a firm's brand_______ is a term that denotes the set of assets and liabilities that are linked to a brand and enable it to raise a firm's valuation. A) Trademark equity B) Brand equity C) Logo equity D) Trademark value-added E) Trade name strengthB) Brand equityA(n) ________ is an early user of a firm's product who is willing to give a testimonial regarding his or her experience with the product. A) tribute account B) reference account C) approval report D) appreciation account E) acknowledgment reportB) reference accountBefore Kim Green opened her jiffy print store, she processed several large print jobs for local merchants for free, to demonstrate the quality of her service and to solicit feedback. Two of the merchants wrote favorable reviews of Kim's service, and agreed to let Kim post the reviews on her company's Web site. The companies that wrote the favorable reviews are referred to as: A) appreciation reports B) acknowledgement accounts C) referent accounts D) tribute reports E) approval reportsC) referent accounts________ refers to the activities the firm takes to communicate the merits of its product to its target market. A) Sponsorship B) Advertising C) Endorsement D) Promotion E) PriceD) PromotionThe Google program called ________ allows advertisers to buy keywords on the Google Home Page. A) AdSense B) Adcenter C) Adwords D) Search Marketing E) AdGoogleC) AdwordsA(n) ________ is a route a product takes from the place it is made to the customer who is the end user. A) trade channel B) product channel C) allotment channel D) promotion channel E) distribution channelE) distribution channelA firm's sales process: A) is typically not put in place until a year or more after a startup launches B) describes a firm's branding strategy C) depicts the steps it goes through to identify prospects and close sales D) describes its social media strategy E) depicts the steps it goes through to identify its target market and positioning strategyC) depicts the steps it goes through to identify prospects and close salesWhich of the following is an example of intellectual property? A) Microsoft's headquarters in Redmond, Washington B) Nike's swoosh logo C) the computer that you use D) AirTran's fleet of planes E) the trucks that deliver White Wave soymilk to grocery storesB) Nike's swoosh logoWhich of the following was not identified in the textbook as one of the common mistakes that entrepreneurs make regarding intellectual property? A) not fully recognizing the value of their intellectual property B) not properly identifying all their intellectual property C) not properly registering their Internet domain names D) not using their intellectual property as part of their overall plan for success E) not taking sufficient steps to protect their intellectual propertyC) not properly registering their Internet domain namesThere are two primary rules of thumb for deciding if intellectual property protection should be pursued for a particular intellectual asset. First, a firm should determine if the intellectual property in question is directly related to its competitive advantage. Second, a firm should determine if its intellectual property: A) is less than 20 years old B) could be licensed to another company C) has value in the marketplace D) is something that was developed "in-house" E) rightfully belongs to the firm or the employees who developed itC) has value in the marketplaceThe What Went Wrong feature in Chapter 12 focuses on Dippin' Dots, a company that sells ice cream snacks. Dippin' Dots lost the patent on its small beads of ice cream primarily because: A) it failed to obtain permission from a patent holder that has "prior art" pertaining to the claims in its patent B) it had sold its ice cream product one year prior to applying for a patent C) it filed its patent application incorrectly D) its patent infringes on the patent of a competitor E) it failed to renew its patent on timeB) it had sold its ice cream product one year prior to applying for a patentWhich form of intellectual property protection is the only one expressly mentioned in the original articles of the U.S. Constitution? A) assurances B) patents C) copyrights D) trade secrets E) trademarksB) patentsThe sole entity responsible for granting patents in the United States is the: A) U.S. Patent and Trademark Office B) Federal Patent, Copyright and Trademark Office C) Securities and Exchange Commission D) U.S. Departments of Patents E) U.S. Treasury DepartmentA) U.S. Patent and Trademark OfficeSince the first patent was granted, there have been over ________ patents granted in the United States. A) 500,000 B) 3 million C) 5 million D) 7 million E) 9 millionD) 7 millionThe term of a utility patent is: A) 7 years from the date the patent is granted B) 15 years from the date of the initial application C) 15 years from the date the patent is granted D) 20 years from the date of the initial application E) 20 years from the date the patent is grantedD) 20 years from the date of the initial applicationAmazon.com's one-click ordering system, Priceline.com's "name-your-price" business model and Netflix's method for allowing customers to set up a rental list of movies they want mailed to them are examples of: A) copyright extension patents B) utility patents C) business process protection patents D) trademark extension patents E) business method patentsE) business method patents________ patents are the second most common type of patent and cover the invention of new, original, and ornamental designs for manufactured products. A) Aesthetic B) Utility C) Visual D) Blueprint E) DesignE) DesignA utility patent is good for ________ from the date of the original application, a design patent is good for ________ from the date the patent is granted, and a plant patent is good for ________ from the date of the original application. A) 14 years, 14 years, 20 years B) 20 years, 20 years, 14 years C) 20 years, 20 years, 20 years D) 20 years, 14 years, 20 years E) 14 years, 20 years, 14 yearsD) 20 years, 14 years, 20 years________ takes place when one party engages in the unauthorized use of another party's patent. A) Patent breach B) Patent encroachment C) Patent violation D) Patent infraction E) Patent infringementE) Patent infringementThere are four types of trademarks: A) trademarks, service marks, collective marks, and certification marks B) examination marks, trademarks, combined marks, and service marks C) shared marks, collective marks, mutual marks, and trademarks D) service marks, cooperative market, trademarks, and shared marks E) trademarks, collective marks, documentation marks, and combined marksA) trademarks, service marks, collective marks, and certification marksWhich of the following is not a type of trademark? A) trademark B) certification mark C) documentation mark D) collective mark E) service markC) documentation mark________ are similar to ordinary trademarks, but they are used to identify the services or intangible activities of a business rather than a business's physical product. A) Creative marks B) Intangible marks C) Examination marks D) Service marks E) Subtle marksD) Service marks________ are trademarks or service marks used by the members of a cooperative, association, or other collective group, including marks indicating membership in a union or similar organization. A) Collective marks B) Share marks C) Examination marks D) Joint marks E) Certification marksA) Collective marksWhich of the following is an example of a certification mark? A) ModCloth B) International Franchise Association C) Underwriter's Laboratories D) Rotary International E) 1-800-FREE-411C) Underwriter's LaboratoriesA trademark is renewable: A) every 10 years, as long as the mark remains in use B) indefinitely, regardless of whether the mark remains in use C) every 20 years from the date of application for the trademark D) every 3 years E) every 33 yearA) every 10 years, as long as the mark remains in useWhich of the following is not generally eligible for trademark protection? A) trade dress B) shapes C) words D) surnames E) designs or logosD) surnamesA trademark is registered with the: A) U.S. Commerce Department B) Federal Trade Commission C) Securities and Exchange Commission D) Federal Patent, Copyright, and Trademark Office E) U.S. Patent and Trademark OfficeE) U.S. Patent and Trademark OfficeA form of intellectual property protection that grants to the owner of a work of authorship the legal right to determine how the work is used and to obtain the economic benefits from the work is referred to as a(n): A) assurance document B) patent C) trade secret D) brand E) copyrightE) copyrightWhich of the following statements about copyrights is incorrect? A) Businesses typically possess a treasure trove of copyrightable material. B) A musical composition that is written down is copyrightable. C) Copyrightable material may be in tangible or intangible form. D) The 1976 Copyright Act governs copyright law in the United States. E) A copyright is a form of intellectual property protectionC) Copyrightable material may be in tangible or intangible form.Copyright law is governed by the: A) U.S. Constitution B) the 1946 Intellectual Property Act C) the 1966 Trademark and Copyright Act D) the 1955 Inventors and Writer's Protection Act E) Copyright Revision Act of 1976E) Copyright Revision Act of 1976Which of the following symbols is the copyright bug? A) ç B) € C) ¢ D) © E) ™D) ©According to current regulations, any copyrightable work created on or after January 1, 1978, is protected by copyright law for the life of the author plus: A) 28.5 years B) 101 years C) 40 years D) 55 years E) 70 yearsE) 70 yearsThe main exclusion from copyright laws is that copyright laws cannot protect: A) ideas B) dramatic works C) computer software D) musical compositions E) literary worksA) ideas________ occurs when one work derives from another or is an exact copy or shows substantial similarity to the original work. A) Copyright infringement B) Copyright violation C) Copyright intrusion D) Copyright breach E) Copyright duplicationA) Copyright infringementA company's customer list is most commonly protected under ________ regulations. A) patent B) copyright C) trade secret D) trademark E) collective markC) trade secret________ include marketing plans, product formulas, financial forecasts, employee rosters, logs of sales calls, and laboratory notebooks. A) Trade secrets B) Trademarks C) Collective marks D) Patents E) Copyrights venturesA) Trade secretsWhich of the following items would typically be protected by a form of intellectual property protection other than trade secret statutes? A) financial forecast B) product formula C) a company's tagline D) logs of sales calls E) employee rosterC) a company's taglineThe federal Economic Espionage Act, passed in 1996, criminalizes: A) copyright infringement B) utility patent violations C) trademark violations D) design patent violations E) the theft of trade secretsE) the theft of trade secretsThe ________, which was drafted in 1979 by a special commission, attempted to set nationwide standards for trade secret legislation. A) Intangible Assets Protection Act B) Fairness in Intellectual Property Act C) Uniform Trade Secrets Act D) Trademark & Copyright Act E) Economic Espionage ActC) Uniform Trade Secrets ActAccording to the textbook, trade secret disputes arise most frequently when: A) one firm alleges that it can legally use another firm's trade secrets because they were "voluntarily" disclosed B) an employee leaves a firm to join a competitor and is accused of taking confidential information with him or her C) one firm claims that another firm outright stole its trade secrets D) one firms claims that what another firm is claiming as a trade secret is common knowledge E) one firm claims that it obtained another firm's trade secrets through legal meansB) an employee leaves a firm to join a competitor and is accused of taking confidentialAn ________ is conducted to determine the intellectual property a company owns. A) intellectual property audit B) intangible materials audit C) academic property inventory D) intellectual materials inventory E) intangible property inventoryA) intellectual property auditThere are two primary reasons to conduct an intellectual property audit. First, it is prudent for a company to periodically determine whether its intellectual property is being properly protected. The second reason for a company to conduct an intellectual property audit is to: A) remain prepared for a Security & Exchange Commission spot inspection B) remain prepared to justify its value in the event of a merger or acquisition C) remain prepared for an initial public offering D) update the value of its intellectual property on its balance sheet E) make sure no intellectual property has been stolenB) remain prepared to justify its value in the event of a merger or acquisition