Business Plans Test Upwork Answers 2019

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

51. What is one of the reasons for the failure of companies?

Answers: 

• Their product sells too well

• They fail to make a marketing plan

• Lack of long term vision and planning

• The management is over qualified

52. Where would the Financial Projections typically be located in a business plan?

Answers: 

• In the middle of the plan

• In the final section before the appendix

• In the first section before the executive summary

• In the section after the executive summary

53. What is a characteristic of a market leader strategy?

Answers: 

• Follows the strongest company in the industry

• Goes out of business first

• Copy cats other companies

• Makes the first moves and distinguishes itself as the prominent player in the industry

54. What are the minimum financial statements that should be included in a business plan?

Answers: 

• Statement of Retained Earnings and P&L

• Income Statement, Balance Sheet, Statement of Cash Flow

• Only profit projections for five years

• Cash Flow, Balance Sheet and Statement of Retained Earnings

55. What best describes a differentiation strategy?

Answers: 

• Emphasis on the unique benefits of the product or service

• Focus on product pricing

• Focus on marketing

• None of the above

56. Which of the following could be a core competency of a company?

Answers: 

• No marketing plan in place

• Ability to change direction quickly

• High labor burden rates

• Inexperienced management team

57. What would be the best methodology to follow while creating a forecast?

Answers: 

• Be conservative

• Be extravagant

• Base it on a competitor's

• Copy someone else's so you don't have to take any pains

58. What is a "Pay Per Click" marketing campaign?

Answers: 

• Television advertising based on channel changing

• Radio advertising

• Online advertising where a company pays each time their advertisement is clicked on, typically on a website where the company's target market would often be found

• Print ads distributed with newspapers

59. Why would a new company spend most of their budget on marketing?

Answers: 

• Investors want to see their money spent on marketing

• There is nothing else to spend the money on in the early stages

• It is a requirement of SEC for new companies

• To establish a client base early on

60. What are core competencies?

Answers: 

• Things your company is not good at

• What your competition is good at

• The management team

• Things that you and your company are the strongest at

61. Would you ever consider talking to your competitors directly?

Answers: 

• No, you do not want to give away any information about the company

• Only if you can get them to talk without you having to talk

• Yes, but only if they pay you for information

• Yes, companies often discuss their business models with competitors as it is often not a secret, and both parties can benefit

62. Which of the following terms best describes how a company can make itself stand out from the competitors?

Answers: 

• Differentiation

• Marketing

• Doing a business plan

• Stealing employees

63. Why is it important to track your competitors?

Answers: 

• They might be indulging in illegal activities

• You can steal their employees

• To look for the moves they are making which could impact your business

• You can steal their proprietary ideas

64. What policy should be followed regarding employees and the company strategy?

Answers: 

• Never let employees know the strategy; they are there just to do their job and nothing more

• Only let top executives know the company's strategy

• Let everyone know the company strategy and how they will accomplish it

• Require employees to sign a non disclosure before reading it

65. Which of the following strategies has warehouse reseller Costco taken?

Answers: 

• High prices, selected goods

• A strategy similar to that of a regular grocery store

• Low priced items but a limited selection

• A wide variety, low price, no frills shopping experience with a membership

66. What is meant by vertical integration?

Answers: 

• A product sold to marketing firms

• Being involved in many stages of the industry

• Focusing on one aspect of your industry

• Using new age software

67. What section would SWOT analysis typically be in?

Answers: 

• Financial Highlights

• Executive Summary

• Business Model

• Market

68. What market segment is an airline offering no frills targeting?

Answers: 

• Price sensitive people

• Rich people

• Time sensitive people

• Anyone who will fly their airline

69. What should be the minimum length of a business plan?

Answers: 

• 2 pages at the most

• At least 50 pages

• At least 100 pages

• There are no predefined standards

70. Why is it important to talk about market timing?

Answers: 

• There are laws about entering a market in an off time

• There are no preferred times to enter a market, it is irrelevant

• While there is no good time to enter a market, it is important to discuss them

• Several industries are cyclical and there are advantages in entering a market which is just beginning on an upswing

71. What is the purpose of a what-if analysis?

Answers: 

• It is required by law

• It shows the preparer is intelligent

• It shows the forecasted numbers under different scenarios, both good and bad

• It shows what happens if the firm doesn't receive investment capital

72. Which of the following would you factor into long term liabilities?

Answers: 

• Loans the company has to take

• Interest rates

• Current depreciation rates

• Revenue projections

73. Which of the following is one of the groups a business plan is meant to inform?

Answers: 

• The SEC

• Government entities

• Potential investors

• The IRS

74. Which of the following is a traditional method of marketing?

Answers: 

• Pay Per Click

• Television advertisements

• Search Engine Optimization

• None of the above

75. Why would a company with a very rigid business plan possibly face trouble?

Answers: 

• Competitors will more easily mimic their business model

• They will run out of money quicker

• The management will not stay with the company

• It will be unable to change as the market changes

76. What is one of the ways to track your competitors?

Answers: 

• To keep track of publicly available financial statements

• Ask your employees to spy on them

• Bribe one of their employees

• Assume they do better than you

77. Which of the following would not typically be a section in a business plan?

Answers: 

• Executive Summary

• Financial Projections

• Market

• Payroll Policies

78. Why should a business plan be revisited annually?

Answers: 

• To make sure the company gets its money's worth out of the business plan cost

• Because the company's values, objectives, strategies and forecasts keep changing

• It is required by law

• It helps the management to look intelligent to the employees

79. What is meant by Market Demographics?

Answers: 

• The number of people in the market

• Age, gender, racial, educational, occupational, religious characteristics

• The population of the country being marketed to

• Buying trends of the market

True or False? It is acceptable to use business jargon or pop culture references in a business plan.

False

True

The use of exhibits are intended for:

All of these

Showing your graphing skills

Visual information that is easier to interpret than words

Breaking up the writing

Which should NOT be included in an executive summary?

Dates

Name of founders

Exhibits

Current investors

The 4Ps are also known as:

Marketing trends

Market demographics

Promotions

Marketing mix

Financial Projections are done before Market Analysis and objectives are set. True or False.

False

True

How long should a typical business plan project for?

6 months

3-5 years

8-10 years

12 months

Estimating capital requirements is important for the:

Product management

Product design

Break-even analysis

Marketing

A Business Plan should not include a section about regulatory issues since this is out of the business owners hands. True or False

True

False

What does the 'T' stand for in SWOT analysis?

Target

Technology

Trends

Threat

What does Market Share mean?

The portion of a market controlled by a particular company or product.

Ownership stake in a public company

Opportunities to share in greater market profits

What is the first section in a traditional business plan?

Executive summary

Financials

Marketing plan

Management profile

True or False? You should have concise bulleted lists in a business plan.

False

True

Answering which of the following questions does NOT help in understanding a niche?

Which areas are being ignored by competitors?

How will the Board of Directors help implement capital controls?

What are potential opportunities for the business?

Which areas are competitors already well-established?

Potential creditors will often be interested in gaining collateral before lending. True or False

True

False

The Purpose of the Company Description in the Business Plan is:

(all of these)

Describe the nature of your business and list the marketplace needs that you are trying to satisfy.

List the specific consumers, organizations or businesses that your company serves or will serve.

Explain how your products and services meet these needs.

One common method for selecting prices is called Cost Pricing Strategy. This means:

Estimating price consumers wish to pay

Comparing to market norms and adding/subtracting premium based on perceived quality

Calculating the Costs of Production/Service per unit and adding a per unit profit margin

In the financial forecasting, operating profit margin should be:

Negative

Positive

Unchanged

In a competitor analysis, what should you focus on?

Barriers to entry

Prime customer motivators

All of these

Component costs

True or False? A business plan should only focus on short term objectives

False

True

True or False: Narrowing the target for potential clients helps because it concentrates sales efforts to a selective group that is most likely to be most profitable.

True

False

New funds can be put toward which of the following?

All of the above

Working capital

Acquisitions

Debt retirement

What should organizational structures include?

All of these

Management résumés

Forms of ownership

Percentage of ownership

Who are the most important readers of a business plan?

Customers

Investors

Competitors

Employees

True or False: Start-up companies are almost always succesful in the first few years.

True

False

True or False: A partnership is normally run by one entreprenuer

True

False

Legal issues like non-disclosure agreements and patents are NOT important considerations for the business.

True

False

An appendix may include:

Letters of reference

All of these

Building permits

Résumés

It is common for creditors to want historial financial statements, True or False

True

False

Ratio and Trend Analysis can help to create a better picture of profitability and growth potential. True or False

False

True

True or False? A business plan should state a value proposition.

True

False

Which of these is an example of a competitive strategy?

Pricing

Distribution

All of these

Promotion

Sales targets should be:

Both specific and measurable

Measurable

Specific

Lofty

True or Fales: An Organization Chart is a diagram that shows the structure of an organization and the relationships and relative ranks of its parts and positions/jobs.

True

False

What is ROI?

Return on Investment

Ratio of Intermediaries

Rapid Operation Inspection

Rate of Installation

What is the Executive Summary of a Business Plan?

Plan of Executive Orders

Summary Provided To Bank Executives

A snapshot of your business plan as a whole and touches on your company profile and goals.

SWOT Stands for

Simple While On Target

Strengths, Weakness, Origination, Targets

(none of these)

Strengths, Weaknesses, Opportunities, Threats

True or False: The Market Analysis of your business plan should illustrate your industry and market knowledge as well as any of your research findings and conclusions.

True

False

When requesting funding it's important to be clear on:

Timing of funds

Time period funding is for

All of these

Type of funding (Equity vs Debt)

What is not included in variable costs?

Direct sales

Technology

Packaging

Supplies

Market Penetration Strategy is one of the Strategies underlying Cost Control. True or False

True

False

International sales can be hampered by:

Language Barriers

Cultural Differences

Regulatory Issues

All of the above

What should the prospective financial data include?

All of these

Cash flow statements

Income statements

Balance sheets

A pricing strategy where you set your prices high for quick cash and little emphasis on market penetration is called:

Price skimming

Top shelf pricing

Luxury illusion

Market saturation

Marketing Strategies can be composed of:

Funding Allocations

Growth Strategy

Poison Pill

SWOT

In a business plan the Funding Requests portion should include:

All of the above

Strategic Financial Situations

Expected Employee Retention

Competitors Product Cycle

In the Competitive Analysis It's important to include:

SWOT Analysis

Financial Statements

Potential Barriers to the Market

A good way to analyze the external environment is with a(n):

PEST Analysis

SWOT Analysis

None of these

VRIO Framework

What is the post-money valuation for a $1.5 million round of investment when the equity stake offered is 25%?

$4.5 million

$1.5 million

$6 million

$375,000

What will a VRIO framework help distinguish?

Organizational structure

Financial potential

Competitive potential

Size of the target market

The first thing to assess in your market analysis is the:

Target market

Industry outlook

Competitive analysis

Size of primary target market

The section of your business plan that is similar to an "elevator pitch" is the:

Executive Summary

Company Description

Appendix

Market Analysis

For a typical executive summary, what is the maximum length?

1 page

3 pages

2 paragraphs

Half a page