1. How could a video rental outlet stand out above their competitors in a positive way?
Answers:
• Guaranteeing availability of all videos
• Charging more by claiming better quality
• Having less staff and creating longer waiting time
• Having fewer locations and thus making it exclusive
2. How does a company assess the performance of its marketing efforts?
Answers:
• By looking at the total revenue and assuming part of it came from marketing
• By dividing marketing expenses by revenue
• By just assuming the more the company spends on marketing, the more it makes
• By tracking where customers are coming from and weighing the cost of marketing against the number of customers and their spending
3. How is "distribution and delivery" defined?
Answers:
• How a company receives its inventory
• How a customer pays for its product
• How a customer learns about its product
• How a customer actually receives its product
4. Why is it important to talk about competition?
Answers:
• It is not important; competition should be ignored
• You want to compliment them in your plan so they like you and your company
• They can sue you if you ignore that they exist and lie to the reader
• Everyone has competition. It is best to address the competition and plan how your firm will stack up against it
5. How detailed should a business plan be?
Answers:
• As detailed as possible, making each section very clear and specific
• Very vague, leaving the reader having to ask several questions
• Somewhat clear, answering general questions but including nothing specific
• None of the above
6. How far into the future should revenue be projected in a business plan?
Answers:
• 2 years
• 6 months
• 1 year
• 5 years
73 NOT Answered Yet Test Questions:
(hold on, will be updated soon)7. What would a Market Follower strategy be distinguished by?
Answers:
• A company who attacks the market leader
• A company who turns a few heads but does not challenge the market leader
• A company on the verge of going out of business
• A company who wants to enter new markets
8. What is a value chain?
Answers:
• The sequence of activities a business takes to add value to its products and services
• A list of questions directed at past clients
• An award given to industry leaders
• A marketing strategy
9. What is meant by "top down" budgeting?
Answers:
• Starting with specific forecasts by department and then rolling them up
• Starting with high level numbers and breaking down into subcategory amounts
• Allowing several people to contribute to the budget
• Budgeting for the next 10 years
10. Where would company valuation be discussed?
Answers:
• Market
• Marketing
• Financial section
• Executive Summary
11. Why are companies able to stay in business during turbulent financial market times?
Answers:
• They have saved up enough money; they can use these savings to bolster their earnings
• They frequently lay off people thus running a bare bones company
• They have designed a flexible business model that can adapt to change
• They don't; most if not all companies go out of business
12. What is the purpose of creating a valuation statement of the company?
Answers:
• It is required for financial statements
• To work with investors and determine what percentage of equity to give away for investments
• To entice private investors by giving them an unrealistic view of what the company is worth
• The IRS will require it with the tax return
13. What is meant by Relationship Marketing?
Answers:
• Placing ads on the television
• Going door to door to market the company
• Sending out coupons to customers
• The opposite of Mass Marketing — connecting with customers directly, one to one
14. What is Blockbuster Videos business model?
Answers:
• It sells candies
• It hires unemployed war veterans
• It sells high quality goods at discounted prices
• It rents dvds for a fee
15. What best describes a cost-leadership strategy?
Answers:
• Focus on product quality
• Focus on marketing
• Focus on pricing
• None of the above
16. Which of the following would be a mistake in forecasting?
Answers:
• Using unrealistic expectations
• Creating a detailed revenue projection
• Creating a set of assumptions on which the forecast is built
• Making a forecast for several years
17. Which of the following would be a value proposition?
Answers:
• Wal-Mart offers the cheapest prices around on a wide range of merchandise.
• Wal-Mart uses coupons to entice visitors to the store
• Wal-Mart hires elderly people
• Wal-Mart is always busy
18. What type of company would never need a business plan?
Answers:
• A hockey equipment manufacturer
• A new online service based company
• A shoe retailer
• None of the above
19. Which of the items below is NOT a purpose of a business plan?
Answers:
• Informing potential investors of the company's business model
• Offering shares of the company for sale
• Letting the employees know the purpose of the business
• Helping the management by providing them with a road map
20. Which of the following factors would be used in estimating revenue?
Answers:
• Current telephone rates
• Number of employees
• Market size
• Interest rates
21. In which section of a business plan would the company's mission statement be located?
Answers:
• Business Model
• Financial Projections
• Market
• Management
22. Why would a company's website be considered a part of its marketing effort?
Answers:
• It is a way to reach out to current and potential customers with information about its product and its value proposition
• It falls under the marketing budget
• The web designer's salary falls under marketing
• The company can offer coupons to customers by creating it
23. Where might a potential competitor come from?
Answers:
• An established company in a different industry could easily expand into your market
• Any company in any industry is a threat
• Some employees may leave and start their own companies
• Some members of the management could leave and start their own company
24. What is one of the ways to establish who your competitors are?
Answers:
• Conduct a survey
• Ask the government
• Pay a detective firm to find out
• Determine your customer base and look at their alternatives
25. What is one of the criteria that a flower delivery company could distinguish itself by on the market?
Answers:
• Charging more
• Timeliness of the deliveries
• Their delivery people are all over age 45
• They have the latest cash register on the market
26. Would a company that produces a complementary product to yours be considered a competitor (e.g. a tennis ball maker and a tennis racket maker)?
Answers:
• Yes, they will try to put you out of business for sure
• Yes, they could expand into your market with their industry expertise
• No, they are restricted by law against entering your market
• No, they won't know how to enter your market
27. Why is it important to have an executive summary?
Answers:
• It is required by law
• It urges the reader to read the entire plan to learn more
• It gives the reader a quick 1 to 2 page summary of the entire business plan without having to read the whole document
• It can be used to sell the shares of the company
28. Why is it important to identify your market segments?
Answers:
• It is required by law
• The company will fail without the information
• It is required for budgeting
• You need to tailor your marketing strategy and products to each market segment differently
29. Why is it important to hire intelligently early on?
Answers:
• You can pay lower rates if you hire early on
• It is easier to fire people who were hired early
• There are tax benefits
• Having key management people in place is important as they will aid in making important decisions early on
30. What is meant by "market segments"?
Answers:
• Different areas of the market
• Different categories of customers
• Different ways to reach the customer
• The various product lines of the company
31. What would sending coupons to prior customers directly be considered?
Answers:
• Target Marketing
• Mass Marketing
• Radio Marketing
• Coupon Forwarding Marketing
32. What role does marketing play in a company's business life?
Answers:
• It creates a tax obligation
• It is how it makes potential customers aware of its products and services
• It is part of the ordering process
• It is part of the financial reporting process
33. What strategy should a new company wanting to enter a market employ?
Answers:
• Market to everyone on earth and see what happens
• Look at the market leader and attempt to steal all of their clients
• Spend every cent they can on online advertising
• Focus on smaller, ignored territories to gain a foothold
34. What is the DuPont formula?
Answers:
• The basic balance sheet formula
• The basic P&L formula
• A formula to show how cash flow is calculated
• A formula created by the DuPont company to help capture all the ingredients of Return on Equity
35. What should a company do if they do not have a marketing plan?
Answers:
• Omit the marketing section completely
• Leave the section blank or write N/A
• Determine the company's marketing plans and realize every company needs some form of marketing
• Copy someone else's marketing plan
36. In which section of a business plan would you talk about the CEO?
Answers:
• Management
• Financial Projections
• Market
• SWOT
37. What is a business model?
Answers:
• A marketing plan
• A financial plan
• A description of what your company does and how it makes money by doing it
• A mini model of the company's headquarters
38. What should be considered while deciding a firm's strategy?
Answers:
• The competitors and the strategy they have employed
• How much the company wants to spend on payroll
• If there is a potential for a lawsuit
• None of the above
39. What is a competitive advantage?
Answers:
• A feature which distinguishes your company from the others and will help it to achieve success
• A listing of competitors
• A marketing strategy
• An advantage your competitors have over you
40. Why is it important to know the entire potential market even if your company can only focus on a small segment?
Answers:
• The total market dictates what the individual market size will be and what the maximum potential size is
• It is needed for company financial reports
• You can expand the company to reach the entire market
• There is no real reason to know
41. What is an advantage of making a competitor analysis?
Answers:
• It is required by law
• It fills out sections of the business plan so it looks impressive
• It find weaknesses in competitors business models and exploit them
• It can lead to lower tax obligations
42. What marketing method is a gas station most likely to use?
Answers:
• Door to door sales
• Online advertisements
• Television ads
• Coupons distributed locally to the residents
43. What is meant by Target Marketing?
Answers:
• Placing a television ad during prime time spots
• Directing your marketing efforts towards a specific demographic or customer type
• Handing out flyers at a football game
• Marketing outside of the Target retail store
44. What is the purpose of a cash flow forecast?
Answers:
• To forecast the company's cash flow and also see if and when the company will ever run out of cash at all
• To fulfill a legal requirement
• To predict profit and loss
• To show if the company can afford to take on investors
45. What is a way to segment the market?
Answers:
• By their looks
• By their geographical location
• By their dreams
• By their library status
46. Why is it okay to let some competitors' moves go unanswered?
Answers:
• Companies should focus on their own initiatives rather that constantly respond to other companies actions
• Let the competitors succeed or fail first before responding to their moves
• It is better to be a follower and always follow the competition
• Competitors always make stupid decisions
47. What is meant by Value Proposition?
Answers:
• The same as by marketing strategy
• How a company plans to raise capital
• How a company plans to price their product
• A promise of value to be delivered and a belief from the customer that value will be experienced.
48. What has been the trend in marketing in the last few decades?
Answers:
• Marketing to mass markets
• Moving towards smaller marketing schemes, more direct to the customer
• Spending less on marketing as it does not really reward the company
• Getting away from the internet and spending more on television advertising
49. How might a company learn more about its market and what drives the customers to purchase their product?
Answers:
• Contact focus groups and gain valuable information directly from the customers
• Make assumptions and go with them
• Ask the competitors and assume it's the same for your company
• There is no way to find out
50. What section of the financial forecast would expenditure on telephones be forecasted under?
Answers:
• Revenue
• Cost of goods sold
• Short term liabilities
• SG&A
