Human Kinetics – Physical Activity and Health Publisher



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1. What are the six characteristics of an entrepreneur?

Correct Answer:

risk taker, innovative, strong leader, self-disciplined, self-starter, invests personal funds

2. An intrepreneur spots an opportunity and fosters change within her organization to start a new venture.

*a. True

b. False

3. RET businesses can create memorable guest experiences by

a. selling souvenirs

b. renting equipment

c. giving lessons

*d. all of the above

e. a and b

4. What are three reasons the textbook cites for increasing demand for RET services?

Correct Answer:

rising incomes, more leisure time, growing awareness of health benefits

5. A potential advantage of buying a franchise is _________.

a. maximum flexibility to create own concept

b. possibility of saturation of market

*c. instant customer loyalty

d. cost of royalty fees

e. none of the above

6. When an owner is willing to take less than market value for an otherwise profitable company, it is _________ business sale.

a. a probate

b. a redevelopment

c. an involuntary

*d. a distressed

e. a or b

7. When buying an existing business, it is critical to obtain a noncompete agreement from the seller.

*a. True

b. False

8. One reason not to operate an RET business as a sole proprietorship is because

*a. the owner is personally liable in event of a lawsuit

b. the owner does not have to share profits

c. the owner does not have government approval

d. the owner can quickly set up his business

e. none of the above

9. What legal form of business does the textbook cite as well suited to RET businesses because of tax and limited liability benefits?

Correct Answer:

limited liability company

10. A subchapter S corporation is set up to pay corporate income taxes on profits.

a. True

*b. False

11. A _________ is a right granted by the federal government to inventors for the making, selling, or using of an invention.

a. domain

*b. patent

c. trademark

d. license

e. none of the above

12. Unique challenges to starting and managing a recreation company in a developing country include

a. undervalued real estate prices

b. lower operating costs

*c. language barriers

d. all of the above

e. none of the above

13. What three serious concerns affect tourism in many parts of the world?

Correct Answer:

traveler safety, political turmoil, terrorism

14. In addition to a normal business license, a company planning to conduct business in a public park is required by law to obtain necessary operating permits from the managing agency.

*a. True

b. False

15. According to the U.S. Bureau of Labor Statistics, the RET industry is projected to grow _________ percent over the 2006-2016 period.

a. 5

b. 25

c. 18

*d. 31

e. 42

16. Which of the following is a fatal mistake of start-up businesses that was described in chapter 1?

a. lack of policies on how to control operating costs

b. hiring the wrong staff

c. rushing too quickly to start-up

d. creating a nebulous business concept

*e. all of the above

17. What are the three sections of the small business plan described in chapter 1?

Correct Answer:

introduction, business description, financial strategy

18. According to the textbook, older adults are not likely to use outdoor recreation as their main form of exercise.

a. True

*b. False

19. According to chapter 1, demand for RET services is increasing in developing countries, especially in _________ and China.

a. South Korea

b. Ireland

c. Kenya

*d. Brazil

e. none of the above

20. Consumer trends suggest that young adults turn to recreation and travel services in order to

a. meet new friends and partners

*b. escape and reduce stress

c. develop new physical skills

d. impress their employer

e. none of the above

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