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Chapter 01 - The Entrepreneurial Revolution: Changing the World through

Chapter 01 - The Entrepreneurial Revolution: Changing the World through Innovat


Innovat Student: ___________________________________________________________________________

1. There is a role for entrepreneurship and innovation in debates about public policy. True or false? True False

2. A Flatter World refers to the convergence of technology and world events that are playing a role in bringing about significant changes in traditional value chains. True False

3. The best way to judge if anyone has an entrepreneurial mind is to test them. True False

4. Entrepreneurship training works well in schools of business and engineering, but has not proven to be useful in fields such as architecture, medicine, and life sciences. True False

5. MIT researcher David Birch found that while new and growing smaller firms could be regionally important, they had little effect on the economy as a whole. True False

6. While research has begun to show that women are starting businesses at a faster pace than men, women entrepreneurs are typically less growth-oriented than their male counterparts. True False

7. Research in the 1980s and 1990s found that since World War II, small entrepreneurial firms have been responsible for half of all innovation and 95 percent of all radical innovation in the United States. True False

8. Studies indicate that although smaller firms often generate twice as many innovations per R&D dollar spent as the established multinationals, the large firms still produce more innovations per R&D scientist than entrepreneurial companies. True False

9. The world's first solar-powered motoran innovation aimed at heading off the world's dangerous dependence on coalwas introduced in 1861. True False

10. At the heart of the entrepreneurial process is: A. people B. context C. innovation D. difference

11. What is it that entrepreneurs do? A. Make money B. Make a difference C. Transform the world D. Transform work and social life

12. R & D is more beneficial to: A. all firms B. small firms C. technological firms D. private enterprise firms

13. Entrepreneurship: A. is becoming a dominant management model B. has created a new education paradigm C. is the new management paradigm D. All of the given answers

14. What conditions are necessary for entrepreneurship to develop and grow? A. Planned economies B. Unplanned economies C. Free and open markets D. Democratic societies

15. One of the key features of entrepreneurship as the new management paradigm is: A. flat organisations B. large hierarchical top down centralised models C. military-like ways of organising D. concentrating on large organisations

16. What is one of the key features of entrepreneurship as a new education paradigm? A. Student are opportunity-centric B. Students are passive and learn from lectures C. Examinations are the best way to assess students D. Students are not capable of self evaluation

17. Entrepreneurship teachers are more likely to be: A. advocates B. mentors C. coaches D. all of the given answers

18. A central part of the new education paradigm is: A. richness, creativity and lectures B. richness, rule following and creativity C. creativity, innovation and prescription D. creativity and richness

19. An example of the energy creation effect from teachers is: A. creating strategic alliances with others B. bringing old mindsets to new problems C. waiting until resources are available D. maintaining the status quo

20. What has been a key driver of global entrepreneurship? A. Technology B. Geography C. Internet D. People

21. What is one of the strategies of the European Union that makes it the most competitive economy in the world? A. Improving the flow of information B. Encouraging more people to migrate C. Creating more regulations to assist in innovation D. Fuelling entrepreneurial mindsets

22. Do entrepreneurial firms add to employment growth in an economy? A. Some, but not a lot B. Significantly but only in very large firms C. Significantly D. They make no difference at all

23. One of the key contributors to the entrepreneurial revolution is: A. Karl Marx B. the growth and increasing globalisation of venture capital C. Adam Smith D. international financial markets

24. What does 'high engagement' philanthropy mean? A. Someone closely connected to their money B. Funder is directly and personally engaged with the organisation C. An approach to funding ventures to make money D. A funder owns the organisation

25. What is one of the most important areas of the entrepreneurial mindset? A. Role of and attitude towards risk, failure and even bankruptcy B. Role of and attitude towards how quickly a profit can be made C. Role of and attitude towards how quickly the business can be grown and sold D. Role of and attitude towards how finance is raised and at what cost

26. Top-tier ventures that achieve a critical mass that can: A. Attract good people B. Enhance the prospect of a harvest C. Lift a community D. All of the given answers

27. Paul Trainor, one of Australia's most successful entrepreneurs, was a leading developer of: A. Resource based companies B. Rural based companies C. biotechnology companies D. all of the given answers

28. A European Union action plan to boost entrepreneurship in the region included all the following except: A. Improving the flow of finance B. Gearing entrepreneurs for growth and competitiveness C. Privatising state-controlled enterprises D. Creating a more entrepreneurial-friendly regulatory and administrative framework

29. Which of the following is not a characteristic of new venture creation? A. Fosters job creation B. Rewards talent and performance C. Creates economic and social mobility D. All of the given answers are characteristics of new venture creation

30. Which internationally recognised innovative firms did not have origins in Australia? A. INCAT B. INTEL C. Cochlear D. Compushare

31. Which of the following was not a company that fostered the formation of a new industry? A. Google B. INTEL C. Federal Express D. Apple

32. Innovation + Entrepreneurship = Prosperity and ________. ________________________________________

33. Entrepreneurship is a proven force of economic and social ________. ________________________________________

34. When successful entrepreneurs get involved with non-profits directly by offering strategic assistance (like long-term planning, board and executive recruitment, coaching, and leveraging relationships to identify additional resources and facilitate partnerships), this is referred to as ________ philanthropy. ________________________________________

35. Name three countries outside the US where entrepreneurship is affecting positive political, social and/or economic change.

36. What should always be done following an interview with an entrepreneur?

37. Explain why venture capital is a particularly appropriate funding source for industries with long gestation periods.

Chapter 01 - The Entrepreneurial Revolution: Changing the World through Innovat Key

1. (p. 16) There is a role for entrepreneurship and innovation in debates about public policy. True or false? TRUE

Governments have come to realise that entrepreneurship can lead to significant economic growth and hence are attempting to put in place policies which will encourage the development of entrepreneurial activities and, as a result, increase the rate of economic development.

Difficulty: Easy

2. A Flatter World refers to the convergence of technology and world events that are playing a role in bringing about significant changes in traditional value chains. TRUE

Difficulty: Easy

3. (p. 2) The best way to judge if anyone has an entrepreneurial mind is to test them. FALSE

Difficulty: Easy

4. (p. 12) Entrepreneurship training works well in schools of business and engineering, but has not proven to be useful in fields such as architecture, medicine, and life sciences. FALSE

Difficulty: Easy

5. (p. 17) MIT researcher David Birch found that while new and growing smaller firms could be regionally important, they had little effect on the economy as a whole. FALSE

Difficulty: Medium

6. (p. 18) While research has begun to show that women are starting businesses at a faster pace than men, women entrepreneurs are typically less growth-oriented than their male counterparts. FALSE

Difficulty: Medium

7. (p. 6) Research in the 1980s and 1990s found that since World War II, small entrepreneurial firms have been responsible for half of all innovation and 95 percent of all radical innovation in the United States. TRUE

Difficulty: Easy

8. (p. 6) Studies indicate that although smaller firms often generate twice as many innovations per R&D dollar spent as the established multinationals, the large firms still produce more innovations per R&D scientist than entrepreneurial companies. FALSE

Difficulty: Medium

9. (p. 20) The world's first solar-powered motoran innovation aimed at heading off the world's dangerous dependence on coalwas introduced in 1861. TRUE

Difficulty: Easy

10. (p. 5) At the heart of the entrepreneurial process is: A. people B. context C. innovation D. difference

While each of the elements mentioned are part of the entrepreneurial process, what differentiates entrepreneurs from others is often the way/s in which they are innovative they are doing something new or different. Of course there can be an issue of what constitutes innovation but in terms of the other options innovation is specific to entrepreneurship.

Difficulty: Medium

11. (p. 4) What is it that entrepreneurs do? A. Make money B. Make a difference C. Transform the world D. Transform work and social life

While it is often not their intention, entrepreneurs change the way we work, which can flow into our social life and continue on into the society as a whole. New technology is a good example of this especially the mobile phone (see Exhibit 1.1).

Difficulty: Easy

12. (p. 6) R & D is more beneficial to: A. all firms B. small firms C. technological firms D. private enterprise firms

Studies in the United States consistently demonstrate that per dollar spent, small firms produce more innovations than large firms.

Difficulty: Medium

13. (p. 89) Entrepreneurship: A. is becoming a dominant management model B. has created a new education paradigm C. is the new management paradigm D. All of the given answers

The techniques of entrepreneurship are being used to foster different approaches in each of these areas as there is the belief that entrepreneurship is an essentially transformative force which can be applied across core issues.

Difficulty: Hard

14. What conditions are necessary for entrepreneurship to develop and grow? A. Planned economies B. Unplanned economies C. Free and open markets D. Democratic societies

It is only in the conditions created by free and open markets that entrepreneurs can develop as the market not governments decides which products (goods or services) will be successful. Free and open markets create the necessary first conditions to encourage entrepreneurs to take the necessary risks.

Difficulty: Hard

15. (p. 9) One of the key features of entrepreneurship as the new management paradigm is: A. flat organisations B. large hierarchical top down centralised models C. military-like ways of organising D. concentrating on large organisations

The flat nature of an organisation gives it the ability to be fast, flexible, fluid, and so on, and doesn't get caught up in all the formal rules and operating procedures which can come to dominate large scale organisations who then cannot react quickly and fluidly to changes in the external environment.

Difficulty: Medium

16. (p. 11) What is one of the key features of entrepreneurship as a new education paradigm? A. Student are opportunity-centric B. Students are passive and learn from lectures C. Examinations are the best way to assess students D. Students are not capable of self evaluation

Students are given a much more active role in the learning process and opportunities are given to ensure they can experience the entrepreneurial mindset.

Difficulty: Medium

17. (p. 11) Entrepreneurship teachers are more likely to be: A. advocates B. mentors C. coaches D. all of the given answers

If students are going to be more active in the learning process, then the instructor needs also to modify his/her approach to learning to take account of this philosophy. With learning becoming student-centric, the role of the instructor changes to coach/ mentor/ advocate in order to be congruent with the student-centric philosophy.

Difficulty: Easy

18. (p. 11) A central part of the new education paradigm is: A. richness, creativity and lectures B. richness, rule following and creativity C. creativity, innovation and prescription D. creativity and richness

Creativity and richness are necessary in order to be consistent with the need to follow the student-centric approach to learning.

Difficulty: Medium

19. (p. 14) An example of the energy creation effect from teachers is: A. creating strategic alliances with others B. bringing old mindsets to new problems C. waiting until resources are available D. maintaining the status quo

By creating strategic alliances with others, both internally and externally, it gives greater opportunities for teachers and their students to interact and experience the entrepreneurial process first hand.

Difficulty: Hard

20. (p. 15) What has been a key driver of global entrepreneurship? A. Technology B. Geography C. Internet D. People

Difficulty: Medium

21. (p. 15) What is one of the strategies of the European Union that makes it the most competitive economy in the world? A. Improving the flow of information B. Encouraging more people to migrate C. Creating more regulations to assist in innovation D. Fuelling entrepreneurial mindsets

One of the key aspects of entrepreneurship is the necessity for people to act in entrepreneurial ways. By encouraging this first step, in conjunction with other strategies, there is a great chance of developing higher levels of entrepreneurship.

Difficulty: Easy

22. (p. 17) Do entrepreneurial firms add to employment growth in an economy? A. Some, but not a lot B. Significantly but only in very large firms C. Significantly D. They make no difference at all

There is a significant number of smaller to medium-sized firms in an economy compared to large-scale ones; entrepreneurial firms pursue growth-orientated practices and can add more quickly and significantly to overall employment growth than large-scale firms.

Difficulty: Hard

23. (p. 19) One of the key contributors to the entrepreneurial revolution is: A. Karl Marx B. the growth and increasing globalisation of venture capital C. Adam Smith D. international financial markets

A significant number of entrepreneurial ventures rely upon venture capital to provide the necessary funding to get their firm started. By having venture capitalists operating on a global scale, more entrepreneurial opportunities can find funding.

Difficulty: Medium

24. (p. 23) What does 'high engagement' philanthropy mean? A. Someone closely connected to their money B. Funder is directly and personally engaged with the organisation C. An approach to funding ventures to make money D. A funder owns the organisation

The philanthropist does more than simply donate funds to a non-profit organisation; he/she becomes actively involved in providing a range to services rather than simply funds.

Difficulty: Hard

25. (p. 26) What is one of the most important areas of the entrepreneurial mindset? A. Role of and attitude towards risk, failure and even bankruptcy B. Role of and attitude towards how quickly a profit can be made C. Role of and attitude towards how quickly the business can be grown and sold D. Role of and attitude towards how finance is raised and at what cost

These are some of the first things a potential entrepreneur thinks about. It is how the potential entrepreneur considers these issues that will have a significant impact upon the decision to pursue a potential opportunity.

Difficulty: Easy

26. (p. 1) Top-tier ventures that achieve a critical mass that can: A. Attract good people B. Enhance the prospect of a harvest C. Lift a community D. All of the given answers

Difficulty: Moderate

27. (p. 2) Paul Trainor, one of Australia's most successful entrepreneurs, was a leading developer of: A. Resource based companies B. Rural based companies C. biotechnology companies D. all of the given answers

Difficulty: Easy

28. (p. 15) A European Union action plan to boost entrepreneurship in the region included all the following except: A. Improving the flow of finance B. Gearing entrepreneurs for growth and competitiveness C. Privatising state-controlled enterprises D. Creating a more entrepreneurial-friendly regulatory and administrative framework

Difficulty: Moderate

29. (p. 17) Which of the following is not a characteristic of new venture creation? A. Fosters job creation B. Rewards talent and performance C. Creates economic and social mobility D. All of the given answers are characteristics of new venture creation

Difficulty: Easy

30. Which internationally recognised innovative firms did not have origins in Australia? A. INCAT B. INTEL C. Cochlear D. Compushare

Difficulty: Easy

31. (p. 19) Which of the following was not a company that fostered the formation of a new industry? A. Google B. INTEL C. Federal Express D. Apple

Difficulty: Medium

32. (p. 16) Innovation + Entrepreneurship = Prosperity and ________. Philanthropy

Difficulty: Easy

33. (p. 17) Entrepreneurship is a proven force of economic and social ________. mobility

Difficulty: Easy

34. (p. 23) When successful entrepreneurs get involved with non-profits directly by offering strategic assistance (like long-term planning, board and executive recruitment, coaching, and leveraging relationships to identify additional resources and facilitate partnerships), this is referred to as ________ philanthropy. high engagement

Difficulty: Medium

35. (p. 15) Name three countries outside the US where entrepreneurship is affecting positive political, social and/or economic change.

Mentioned in text: India, China, Russia, Korea, Mexico, and South Africa, Israel, and Ireland

Difficulty: Medium

36. (p. 31) What should always be done following an interview with an entrepreneur?

Write a thank you note

Difficulty: Easy

37. (p. 2021) Explain why venture capital is a particularly appropriate funding source for industries with long gestation periods.

Classic venture capitalists work as coaches, mentors, and partners with entrepreneurs and innovators at a very early stage to help shape and accelerate the development of the company. Venture capitalists generally take a long-term view with their investing. Even with very fast-paced, emerging technologies like biotechnology, personal computers, software and wireless communications, they understand that it can take many years and numerous rounds of patient capital before an investment can be expected to pay off.

Difficulty: Hard

Chapter 01 - The Entrepreneurial Revolution: Changing the World through Innovat Summary
Category Difficulty: Easy Difficulty: Hard Difficulty: Medium Difficulty: Moderate # of Questions 16 6 13 2