Small Business Practice Test 2


1. A _____________ statement should be short (one/two sentences) easy to understand and easy to remember.
a. Mission
b. Vision
c. Cash Flow
d. Pro Forma

2. A Mission statement focuses on the "what" of a business.
a. TRUE b. FALSE

3. A Mission Statement should include:
a. market focus, location,unique qualities of business and what business will do
b. how to grow your business
c. financing methods
d. both "a" and "b"
e. all of the above

4. In the initial business plan it is best to keep your objectives a bit vague, so you won't be discouraged in the first year.
a. TRUE
b. FALSE

5. Measurable objectives could be about market share, return on investment, stages in development, financial performance.
a. TRUE
b. FALSE

6. Objectives should
a. be measurable and refer to a specific outcome
b. be realistic with a specific deadline
c. both of the above

7. A(n) ____________ business plan is usually developed when the business is planning to grow rapidly; whereas, a(n) ______________ business plan is developed when trying to raise substantial money or to attract a partner.
a. summary/full
b. full/operational
c. operational/summary
d. operational/full

8. A(n) ______________ captures the reader's attention, should explain the business status, provide objectives, describe products or services.
a. executive summary
b. transmittal letter
c. table of contents

9. Milestones, schedule and risks are part of
a. fact sheet
b. financial plan
c. Implementation schedule
d. both "b" and "c"

10. Locations, facilities, equipment, labour and manufacturing plans are part of
a. Financial Plan
b. Marketing Plan
c. Implementation Plan
d. Production/Operations Plan

11. The _____________ plan tells what has to be done, when, how and who as far as sales, advertising, policy and distribution.
a. Marketing
b. Financial
c. Pricing
d. Selection

12. Things that are placed in the appendix may include "need to know information" that is too long to put in the body of the report.
a. TRUE
b. FALSE

13. If the monthly cost of operations is $2000 and the profit per unit is $1.00 and the cost per unit is $4.00, then the break even monthly sales amount would be:
a. $10,000
b. $8000
c. $20,000
d. $2000

14. If a newspaper has a circulation of 100,000 and an ad in the paper costs $2000, then the CPM would be:
a. $20
b. $50
c. $ 200
d. $500

15. Intellectual property includes
a. trademarks, patents, copyright
b. concepts, ideas, theories, business objectives

16.A(n) ____________ is a government grant that gives owner the right to take legal action against others who without consent make, use, or sell the invention covered by the during the time from date of application plus 20 years and is not renewable; afterwards product is in pubic domain
a. copyright
b. trademark
c. patent
d. Industrial design

17. Once a trademark, copyright or patent is granted, the government will ensure that legal action is taken against those who violate any intellectual property.
a. TRUE
b. FALSE

18. In business profits equal cash flow.
a. TRUE
b. FALSE

20. To obtain copyright there is no legal requirement in Canada that work be registered; it is acquired on creation of original work.
a. TRUE
b. FALSE

21. Once an owner of a copyright, trademark or patent is dead, the products, ideas or symbols are in the public domain.
a. TRUE
b. FALSE

22. A(n)_______________ normally takes one year before it is granted and is effective for 15 years and may be renewed for 15 year terms>
a. trademark
b. patent
c. copyright
d. auxiliary plan

23. Love money is money from a venture capitalist who sees value in your financial plan.
a. TRUE
b. FALSE

24. An operating loan and a term loan are both classified as "demand" loans. A bank can call in the loan at any time, if they feel your business could be in trouble.
a. TRUE
b.FALSE

ANSWERS



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