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entrepreneurship theory process practice
Questions and Answers of
Entrepreneurship Theory Process Practice
They would not be dependent on the unreliable supply of electricity in the area since they would function without it.
They could help them to preserve fresh dairy products and fruit that could only be bought on certain days.
Become aware of how social entrepreneurship has been contributing to tackling global challenges.
Identify key elements that help to differentiate social entrepreneurship from entrepreneurship, charitable endeavours, social movements, and other forms of social and sustainable business.
Understand the meaning of social change, social innovation, and social impact and how they intersect with social entrepreneurship.
What are the benefts and risks of having multiple defnitions of social entrepreneurship?
Putting together all that you have learnt so far, what is your view of social entrepreneurship? Do you agree with the one proposed by this book or would you include different characteristics?
What are the similarities and differences between the different schools of thought?
Can you think of a historic example (i.e. pre-1990s) that you would consider as an example of social entrepreneurship?
Does their only social impact come from their end result or are their practices and activities also conducted in a sustainable and socially minded way?
Are they involving stakeholders, especially benefciaries, in decision-making and try to treat everyone fairly across their value chain in order to maximise the social impact of their initiative?
If they are non-profts and do not present revenue-generating activities or an entrepreneurial orientation, are they so innovative that they have the potential to change the status quo and solve the
If they manage to become proftable, do they reinvest a signifcant part of their profts to generate further social and/or environmental impact, reaching more members of their target community or
Do they try to tackle a social and/or environmental issue leveraging business tools and mindset, or an innovative approach?
Understand how social entrepreneurship and related concepts are defned in this book.
Refect on the factors driving the emergence of social entrepreneurship as a concept.
Distinguish the main schools of thought on what social entrepreneurship is about.
Learn how social entrepreneurship developed as a concept and as an activity in different parts of the world.
Get a broad understanding of the concept of social entrepreneurship.
If the Isaacsons conclude that the business is worth $660 000, what will be the final selling price, assuming a sale is made? Defend your answer.
How do the replacement value and liquidation value methods work? Why would the Isaacsons want to examine these methods?
If the owner reduces the earnings estimates from seven to five years, what effect will this have on the final valuation? If he increases the discount factor from 15 per cent to 20–22 per cent, what
What would you recommend Rebecca and Josh do to convince Vince that they are right? Offer at least three operative recommendations.
Cite and discuss two reasons Vince should begin thinking about succession planning.
Why is Vince reluctant to turn over the reins to Josh? Include a discussion of Figure 14.2 in your answer.
An entrepreneur can make a number of choices regarding a successor. What choices do you identify with that fit well for your business?
As you see it, what pressures do entrepreneurs sometimes face from outside the family?
As you see it, what pressures do entrepreneurs sometimes face from within the family?
What barriers exist to succession in a business for an entrepreneur?
What eight steps should be followed to harvest a business? Discuss each of these steps.
Why do entrepreneurs look forward to the day when they can take their company public?
What are five qualities or characteristics successors should possess?
In what way can forcing events cause the replacement of an owner/manager? Cite three examples.
What are three of the contextual aspects that must be considered in an effective succession plan?
Explain why the following are important factors to consider when valuing a business: start-up costs, accuracy of projections and degree of control.
What are the steps involved in using the discounted earnings method? Give an example.
Explain how the P/E method of valuation works. Give an example.
One of the most popular methods of business valuation is the adjusted tangible book value. Describe how this method works.
To analyse a business, what types of questions or concerns should the entrepreneur address in the following areas: history of the business, market and competition, sales and distribution, management,
Identify and discuss the three underlying issues in the acquisition of a business.
What would you recommend Pacapol do now? Briefly outline a plan of action he can use to get the financing process started.
In preparing the business plan for the bank, how would this differ to the approach for a private placement, or for the ICC network? Can he present the same plan?
What would be the benefits of raising the THB 120 million through a private placement? What would be the benefits of raising the money through ICC? Are there other creative ways to find a blend of
Would a crowdfunding campaign be the right avenue? After all, they want to grow the business online, so why shouldn’t they use this same channel to raise funds? Be complete in your answer and
What would be the advantages of approaching their uncle and what would be the risks if he said yes? Should they consider debt or equity with a family member?
Would a commercial banker be willing to lend money to the Kumars? How much? On what do you base your answer?
What are the opportunities and risks associated with the new forms of cryptocurrencies for entrepreneurs seeking funds?
Why would an entrepreneur opt to seek crowdfunding? Describe the types of funds an entrepreneur may expect to achieve through the two main types of crowdfunding.
Define the difference between peer-to-peer lending and crowdfunding.
Why do some entrepreneurs need micro-credit?
What has given rise to the emergence of the ‘Impact Investor’ and what, if any, are the differences between them and an angel investor?
An entrepreneur of a new venture has had no success in getting financing from formal venture capitalists. He now has decided to turn to the informal risk capital market. Who is in this market? How
What are some special considerations in approaching family, friends and the foolhardy for entrepreneurial capital?
What are the four Fs and can you identify four-F investors that you know?
Which type of informal investors demand a lower return on investment (ROI)?
An entrepreneur is in the process of contacting three different venture capitalists and asking each to evaluate her new business proposal. What questions should she be able to answer about each of
Some entrepreneurs do not like to seek new-venture financing because they feel that venture capitalists are greedy. In your opinion, is this true? Do these capitalists want too much ROI?
In a new-venture evaluation, what are the four stages through which a proposal typically goes? Describe each in detail.
Identify and describe four of the most common criteria venture capitalists use to evaluate a proposal.
What advantages does venture capital financing offer over finance from an angel investor?
What are some of the advantages of going public? What are some of the disadvantages?
Identify and describe four types of debt financing. Which would you use and why?
If a new venture has its choice between long-term debt and equity financing, which would you recommend? Why?
Profile the differences in characteristics between formal and informal investors as sources of capital.
Identify five different sources of capital and describe the stage of venture development that would most suit each different source.
Of what value is break-even analysis to Dennis? Be complete in your answer.
If the project will be profitable, will it provide Dennis with the desired 20 per cent return? Explain.
What is the break-even point for this project? Will the company make money if it manufactures the components? Show your calculations.
How does the internal rate of return method work? How would you explain it to Regina?
How does the net present value method work? How would you explain this method to Regina?
Using the 2018 sales figures as a trend, with a spreadsheet, develop a sales forecast for January to December with the increase in workflow enabled by each machine purchasing option. Regina has
If Bill has some room for negotiation with the computer company, what would you recommend he do? Why?
Should Bill bid on the contract? Why or why not?
Make up five more questions that could be added to this exercise.
Which country in the world has the ‘worst’ price for a Big Mac?
In which country, Australia or New Zealand, is a Big Mac sold at the best value?
Which country, Australia or New Zealand, is doing better in retail sales volume?
Which country has the highest budget balance as a percentage of GDP? Based upon interest rates, where would you ideally invest your money?
Which country has the highest and which has the lowest trade balance?
Which region of the world has the lowest industrial production?
Which country has the lowest GDP growth and which has the highest?
Which country has the highest predicted increase in GDP from this year to next?
What is the price of one barrel of West Texas Intermediate crude oil?
What are the trends in world oil prices?
How is the price of cocoa tracking?
Which stock (share) has dropped the most?
Which world share market is doing best right now?
What is a sensitivity analysis and why should an entrepreneur seek to apply it? Explain.
When would an entrepreneur be interested in break-even analysis? Explain how fixed, variable and mixed costs are used in the break-even analysis.
Describe the internal rate of return method. When and why would an entrepreneur use this method?
Describe the net present value method. When would an entrepreneur use this method? Why? Make up an example similar to the one in ‘Entrepreneurship in practice: The Indian entrepreneur and the
One of the most popular capital-budgeting techniques is the payback method. How does this method work?Give an example.
Describe how a capital budget is constructed.
What are pro forma statements? How are they constructed? Be complete in your answer.
Describe how a cash-flow budget is constructed.
Describe how an operating budget is constructed.
Describe two sales forecasting methods and explain how they are used.
What are the benefits of the budgeting process?
Describe the purpose of the balance sheet, the income statement and the cash flow statement. Why are these three statements of accounts important for an entrepreneur to understand? Explain in detail.
What do we mean by performance measures? What are the traditional ones? Why do we need to look beyond these now?
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