Cash Flow
To predict the amount of cash a firm needs to operate smoothly, the company should use a _____.
A) cash sales cycle
B) cash receipt
C) cash surplus
D) cash budget
D) cash budget
Which of the following is an external factor to consider in the layout of a business?
A. Wage rates
B. Construction and appearance
C. Proximity to markets
D. Business climate
B. Construction and appearance
A startup needs immediate funds to cover short-term expenses. Which type of loan should they consider?
A) Term loan
B) Short-term loan
C) Installment loan
D) Quick loan
B) Short-term loan
What is the primary difference between cash and profits?
A) Cash is the difference between total revenue and total expenses, while profits measure liquidity.
B) Cash is the money that is free and readily available to use, while profits are the difference between total revenue and total expenses.
C) Cash measures a company’s liquidity, while profits are the difference between total revenue and total expenses.
D) Cash is the money that is free and readily available to use, while profits measure liquidity.
B) Cash is the money that is free and readily available to use, while profits are the difference between total revenue and total expenses.
Which of the following is NOT a factor to consider when choosing the right state for a business location?
A. Wage rates
B. Proximity to needed raw materials
C. Quality of life
D. Internet access
C. Quality of life
Which strategy involves a domestic firm forming an alliance with a company in the target nation to export goods and services abroad?
A) Foreign licensing
B) International franchising
C) Foreign franchising
D) Foreign joint venture
D) Foreign joint venture
A company is preparing its cash budget and needs to determine an adequate minimum balance. Which method is most reliable for deciding this balance?
A) Based on future sales forecasts
B) Based on past experience
C) Based on industry averages
D) Based on competitor analysis
B) Based on past experience
A business owner is considering opening a pop-up store to test the suitability of a location. What is the primary benefit of this approach?
A. Lower start-up costs
B. Increased foot traffic
C. Compatibility with community
D. Higher sales per square foot
A. Lower start-up costs
An entrepreneur wants to improve their competitive position and raise quality levels by expanding globally. Which of the following strategies would be most effective and simple to adopt?
A) Using countertrading
B) Establishing international locations
C) Becoming an expat entrepreneur
D) Exporting
D) Exporting
What is the cash flow cycle?
A) The process of forecasting, collecting, disbursing, investing, and planning for cash needs
B) The time lag between paying suppliers for merchandise or materials and receiving payment from customers
C) The difference between total revenue and total expenses
D) The ease of converting assets into cash
B) The time lag between paying suppliers for merchandise or materials and receiving payment from customers
When choosing a state to open a business, a business owner would consider all of the following except:
A) wage rates
B) local laws and regulations
C) tax rates
D) labor supply needs
B) local laws and regulations
An entrepreneur is reviewing financing options for his new startup company. He decides to begin funding the business with his own money. Which of the following represents the entrepreneur’s initial source of capital?
A) Equity
B) Debt
C) Venture
D) None of the above
A) Equity
A company is recording its cash disbursements for the cash budget. Which of the following should be included first?
A) Variable expenses
B) Fixed amounts due on certain dates
C) Unexpected expenses
D) Seasonal expenses
B) Fixed amounts due on certain dates
A retail business is evaluating a potential site in a shopping mall. Which factor is most important to consider to ensure high visibility and customer attraction?
A. Compatibility with community
B. Demographic fit
C. Foot traffic generated by the mall
D. Proximity to competitors
C. Foot traffic generated by the mall
An entrepreneur is considering different financing options for their startup. All of the following are characteristics of debt capital EXCEPT:
A) Personal investment of the owner.
B) Must be repaid with interest.
C) Carried as liability on the balance sheet.
D) Can be expensive for small businesses.
A) Personal investment of the owner.