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MGT 602 SHORT NOTES

QUESTION: Who is venture capitalist? *ANSWER: A venture capitalist is a professional money manager who makes risk invest¬ments from a pool of equity cap¬ital to obtain a high rate of return on investments. QUESTION: What is meant by business Ethics? *ANSWER: Business ethics is a form of applied factors that examines ethical rules and principles within a commercial context; the various moral or ethical problems that can arise in a business setting; and any special duties or obligations that apply to persons who are engaged in commerce. QUESTION: Explain disclosure document? *ANSWER: The statement that must be provided to prospective customers that describes trading strategy, fees, performance etc is called disclosure document QUESTION: Explain Reverse brainstorming? *ANSWER: Reverse Brainstorming is a different approach to brainstorming this is also called "Negative Brainstorming" Reverse brainstorming helps you solve problems by combining Brainstorming and reversal techniques. By combining these, you can extend your use of brainstorming to draw out even more creative ideas. To use this technique, you start with one of two “reverse” QUESTIONs: Instead of asking, “how do I solve or prevent this problem?” ask, “how could I possibly cause the problem?” Instead of asking “how do I achieve these results?” ask, “how could I possibly achieve the opposite effect?” QUESTION: What is a voluntary export? *ANSWER: Voluntarily exports restraints agreements are Informal bilateral or multilateral arrangements through which the exporting nations voluntarily restrain certain

monitored and even forecasted. In other words external environment analysis is the analysis of demographics. to avoid economic dislocation in an importing country and to avert the possible imposition of mandatory import restrictions by the importing country. external opportunities and threats are scanned. All parties agree to share in the profits and losses of the enterprise. economic. QUESTION: What is entrepreneur-ship? *ANSWER: The process of creating something new with value by developing the necessary time and effort. QUESTION: Is the manager entrepreneur? . QUESTION: Define the functions of barter or third part arrangements? *ANSWER: Barter System A person wishing to buy something in a barter system has to find someone who has this product for sale but who also wants some of the goods possessed by the first person. psychic and social risks and receiving the resulting rewards of monetary and personal satisfaction and independence. assuming the accompanying financial. QUESTION: What is the different between entrepreneur and a manager? *ANSWER: Entrepreneur Entrepreneur is a person who starts the business for the very first time and who is responsible for all the profit and losses. Manager A manager is someone who works with and through other people by coordinating their work activities in order to accomplish organizational goals. usually through export quotas. The person involved in trading of good and services to earn profit and can star at the venture at a high level.exports. QUESTION: Define the term Patent office? *ANSWER: Patent office Patent and Trademark Office Database: the government bureau in the Department of Commerce that keeps a record of patents and trademarks and grants new ones. In industry analysis five things are considered Threats of new entrants Bargaining power of suppliers Bargaining power of buyers Threats of substitute products Intensity of rivalry among competitors QUESTION: What is the difference between the entrepreneur and the businessman? *ANSWER: Entrepreneur Entrepreneur is a person who starts the business for the very first time and who is responsible for all the profit and losses. QUESTION: What skills are required to be a good entrepreneur? *ANSWER: The skills usually required by an entrepreneur are technical skills. economic trends and legal and political issues. These opportunities and threats are analyzed with a careful study of demographics. QUESTION: Explain Environment and industry analysis *ANSWER: In analysis of external environment. Businessman Businessman is a general name to define an occupation of a person involved with business. legal and political situation of that country and technological changes in general. QUESTION: What is meant by Breakthrough innovation? *ANSWER: Break through innovations mean to create some thing new QUESTION: What is a joint venture? *ANSWER: A contractual agreement joining together two or more parties for the purpose of executing a particular business undertaking is called a joint venture. assessed. business management and personal entrepreneurial skills.

Strategic plan: : A forward-looking plan that aims to map out the means to achieve longer-term goals and to plan a response to unforeseen problems and opportunities. Venture plan: : A comprehensive written summary drawn up to establish the viability and direction of a contemplated venture. Profit: : What is left over for the owner(s) of a business after all expenses have been deducted from the revenues of a firm. Revenue: : The total income a business firm or government receives from all sources. 11. 9. 8. The excess of current assets is the working capital. Productivity: : The output of goods and services in the economy or in an industry from the effective use of various inputs (such as skilled workers. It is the "road map" for operating the venture and for measuring its progress on a monthly and annual basis. Patent : Grants holder protection from others making. and entrepreneurial skills that are used in producing goods and services. or uncontrollable events occurring. and so forth to address needs. Opportunity: : A need. 5. It includes how the entrepreneur intends to organize resources to attain established goals. offices. Working capital: : The funds available for carrying on the activities of a business after an allowance are made for bills that have to be paid within the year. management. 6. 7. program. technological innovation. Working capital is calculated by deducting the current liabilities from the current assets of a firm and indicates a company's ability to pay its short-term debts. 10. Gross profit is the profit before corporate income taxes. Window of opportunity: : The time period available for creating the new venture 3. Venture: : Any initiative that entails the mobilization of resources to establish a good. Risk: : The likelihood of undesirable. supplies. factories. managerial know-how. wants. capital equipment. and entrepreneurial activity) used to produce those goods and services. 2. 1. problems. Net profit is the final profit after all deductions have been made. Product-evolution process: : Process for developing and commercializing an innovation 12. service. or challenge that can potentially be addressed by an entrepreneurial idea and an entrepreneurial venture. or selling similar idea 13. problem. using. want. unforeseen. capital equipment. labor. 4. and challenges. Resources: : The raw materials. .*ANSWER: Yes entrepreneur is a good manager as he starts a venture from the very start and depending on the available resources a manager can also become a good entrepreneur.

pre-opening expenses.14. Marketing strategy: : Marketing starts with market research. 23. or the way they are distributed. 26. 25. trademarks. Market economy: : An economy in which the setting of prices and allocating of resources are determined largely by the forces of supply and demand. 16. one part of the balance sheet. partnership. . Liabilities include short-term or current liabilities (such as accounts payable. and continues through into advertising. 28. Investment capital: : (start-up) Initial investment capital necessary for starting a business usually consisting of inventory. and the amount of long-term debt that must be paid within twelve months) and long-term liabilities (which include long-term debts and deferred income taxes). 19. On a balance sheet. and sales and distribution. investment is any purchase of an asset to increase future income. mines. or process to change what goods and services are provided. Investment: : As used in economics. Interest: : The cost incurred in borrowing and using someone else's money or. Liabilities: : All the debts of a corporation. the way they are produced. in which needs and attitudes and competitors' products are assessed. distribution. Market: : The place where buyers and sellers meet to exchange goods for money or for other goods at a price that is arrived at through an implied auction in which buyers and sellers negotiate price. short-term debts. 27. Intellectual property : Any patents.In its broader meaning. packaging. item. or trade secrets held by the entrepreneur 30. alternatively. Marketing: : The planning and implementation of a strategy for the sale. 29. copyright. the income earned by allowing others to use your money. liabilities are subtracted from assets — what remains is the shareholder's equity. Locus of control: : An attribute indicating the sense of control that a person has over life 21. promotion. Opportunity parameters: : Barriers to new product creation and development 15. where applicable. or ownership in the business. as opposed to its application in widespread use. and machinery so as to increase the productive capacity of the economy. income and other taxes due. Invention: : The creation of a new technology. equipment. Lifestyle firm: : A small venture that supports the owners and usually does not grow 22. Iterative synthesis: : The intersection of knowledge and social need that starts the product development process 24. or process. Innovation: : The use of a new technology. 17. 20. Intrapreneurship: : The application of entrepreneurial skills and approaches within or by a corporation. and servicing of a product or service. spending on capital goods such as factories. and. distribution. and leaseholds. Opportunity cost: : The loss of the next best alternative whenever a decision is made involving two or more options. or individual. 18. item. customer servicing and repair.

after adjusting for inflation. and challenges) and the use of resources to implement innovative ideas for new. thoughtfully planned ventures. creative approach to specifically addressing a perceived opportunity (a need. such as machinery. Groupthink: : The forces that tend to suppress or resist divergent thinking when a group is working to accomplish a specific task within a limited period of time. 42. Entrepreneurial domain: : The ways entrepreneurs make decisions 40. Demand is determined by income and by price. problems. . machinery and new technology) to achieve the lowest possible production cost for their products. Depreciation: : A method of calculating and writing off the costs of fixed assets. since population is constantly changing. High-potential ventures: : A venture that has high growth potential and therefore receives great investor interest 34. problem or challenge). wants. in part. Demand: : The combined desire. 37. Desirability of new venture formation: : Aspects of a situation that make it desirable to start a new company. Entrepreneurship: : Involves the recognition of opportunities (needs. Foundation companies: : A type of company formed from research and development that usually does not go public. Idea: : A new. management. Efficiency in one sense — the effective use of resources — is often applied to individual firms in comparing how well they organize the productive process (labor. determined by supply. Gazelles: : Very high growth ventures. which wear out or become obsolete over time. Investment in such fixed assets. a more precise measure is the rate of growth of real per capita income. or to achieve a distribution of the output of society that results in the greatest degree of satisfaction. 39. Entrepreneur as an innovator: : An individual developing something unique 43. and equipment. trucks. 38. 35. Economic growth: : The increase over a period of time in the production of goods and services and the capacity to produce goods and services. Economic growth is usually measured as the percentage increase in gross national product over a specified period of time. 44. which is. Efficiency: : The most effective use or allocation of resources to yield the maximum benefits. Horizontal merger: : Combination of at least two firms doing similar businesses at the same market level 33. Government as an innovator: : A government active in commercializing technology 36. ability and willingness on the part of individuals to acquire or make use of a good or service. want. Entrepreneurial decision process: : Deciding to become an entrepreneur by leaving present activity 41. Diversified activity merger: : Combination of at least two totally unrelated firms 46. 48. In a broader sense it refers to the way in which all of the various factors of production are used to achieve maximum output throughout the economy at the lowest cost. 45. 32. is a normal expense of business. Entrepreneur: : A person who engages in the process of entrepreneurship. buildings.31. 47.

The cashflow projection will highlight periods of cash shortage and potential need for credit 52. 55. In economics. 54. Competition is thus a sophisticated yet uncoordinated mechanism that sorts out the actions of millions of buyers and sellers and uses the resulting pattern of supply and demand to determine what shall be produced. on which a money value hence can be placed. land. in what quantities. a family. 63. In business. Capitalist: : A person who owns shares in a business enterprise. or an incorporated company. 3. factories. patents. etc. money owed to suppliers for goods and services purchased for the normal operations of the venture. machinery. buildings. or real property. a partnership. bonds. In a balance sheet. machinery. certificates of deposit. . 60. This is a generic term referring to a wide range of skills from semi-clerical to highly trained professional work. inventories. The capital in an economy increases as new investments are made from the profits earned on existing capital. Accounts receivable are included on the balance sheet under current assets. one of the factors of production that is essential to the functioning of the economy. Business: : The production of goods or services for profit. Calculated risk: : A risk that has been given thoughtful consideration and for which the potential costs and potential benefits have been weighted and considered is called calculated risk. Capital: : 1. Administrative domain: : The ways managers make decisions 61. Asset: : Anything that can be sold. and other financial reporting and analysis. 2. the total funds invested in the company to enable it to carry out its activities. Cash flow: : A detailed outline of estimates for the receipt of revenue and the payments to be made over a period of time such as six months to a year. investments in other companies. Accounts receivable: : The money that is owed to a venture for goods and services that have been purchased from it or that have been committed as a grant or donation. money owed. cash. and at what price. for example. Business plan: : The description of the future direction of the business 57. everything that an organization owns that can be expressed as a dollar value is listed.49. Business ethics: : The study of behavior and morals in a business situation 58. and other capital goods that are used to produce goods and services and on which income is earned. Such activity can be carried out by an individual. auditing. Breakthrough innovations: : A new product with some technological change 59. Accountant: : A person who carries out bookkeeping. the funds available for investment in financial assets such as shares. Accounts payable: : The outstanding bills of an enterprise. It represents the mines. 56. 53. In financial markets. Corporate culture: : The environment of a particular organization 50. Assets include. Competition: : A market in which rival sellers are trying to gain extra business at one another's expense and thus are forced both to be as efficient as possible and to hold their prices down as much as possible. 62. Accounts payable are included on the balance sheet under current liabilities. 51.

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