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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
exports, usually through export quotas, to avoid economic dislocation in an importing
country and to avert the possible imposition of mandatory import restrictions by the
importing country.
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.
QUESTION: What is entrepreneur-ship?
*ANSWER: The process of creating something new with value by developing the
necessary time and effort, assuming the accompanying financial, psychic and social risks
and receiving the resulting rewards of monetary and personal satisfaction and
independence.
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.
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. All
parties agree to share in the profits and losses of the enterprise.
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.
QUESTION: Explain Environment and industry analysis
*ANSWER: In analysis of external environment, external opportunities and threats are
scanned, assessed, monitored and even forecasted. These opportunities and threats are
analyzed with a careful study of demographics, economic trends and legal and political
issues. In other words external environment analysis is the analysis of demographics,
economic, legal and political situation of that country and technological changes in
general. 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. Businessman Businessman
is a general name to define an occupation of a person involved with business. The person
involved in trading of good and services to earn profit and can star at the venture at a high
level.
QUESTION: What skills are required to be a good entrepreneur?
*ANSWER: The skills usually required by an entrepreneur are technical skills, business
management and personal entrepreneurial skills.
QUESTION: Is the manager entrepreneur?
*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.

1. 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.
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. The
excess of current assets is the working capital.
2. 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, service, program, and so forth to address needs, wants, problems, and
challenges.
4. Venture plan: : A comprehensive written summary drawn up to establish
the viability and direction of a contemplated venture. It includes how the
entrepreneur intends to organize resources to attain established goals. It is the
"road map" for operating the venture and for measuring its progress on a monthly
and annual basis.
5. 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.
6. Risk: : The likelihood of undesirable, unforeseen, or uncontrollable events
occurring.
7. Revenue: : The total income a business firm or government receives from all
sources.
8. Resources: : The raw materials, supplies, capital equipment, factories, offices,
labor, management, and entrepreneurial skills that are used in producing goods
and services.
9. Profit: : What is left over for the owner(s) of a business after all expenses
have been deducted from the revenues of a firm. Gross profit is the profit before
corporate income taxes. Net profit is the final profit after all deductions have been
made.
10. 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, capital
equipment, managerial know-how, technological innovation, and entrepreneurial
activity) used to produce those goods and services.
11. Product-evolution process: : Process for developing and commercializing an
innovation
12. Patent : Grants holder protection from others making, using, or selling
similar idea
13. Opportunity: : A need, want, problem, or challenge that can potentially be
addressed by an entrepreneurial idea and an entrepreneurial venture.
14. Opportunity parameters: : Barriers to new product creation and development
15. Opportunity cost: : The loss of the next best alternative whenever a decision is
made involving two or more options.
16. Marketing: : The planning and implementation of a strategy for the sale,
distribution, and servicing of a product or service.
17. Marketing strategy: : Marketing starts with market research, in which needs and
attitudes and competitors' products are assessed, and continues through into
advertising, promotion, distribution, and, where applicable, customer servicing
and repair, packaging, and sales and distribution.
18. 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.
19. Market economy: : An economy in which the setting of prices and allocating of
resources are determined largely by the forces of supply and demand.
20. Locus of control: : An attribute indicating the sense of control that a person
has over life
21. Lifestyle firm: : A small venture that supports the owners and usually does
not grow
22. Liabilities: : All the debts of a corporation, partnership, or individual; one part
of the balance sheet. Liabilities include short-term or current liabilities (such as
accounts payable, short-term debts, income and other taxes due, 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). On a
balance sheet, liabilities are subtracted from assets — what remains is the
shareholder's equity, or ownership in the business.
23. Iterative synthesis: : The intersection of knowledge and social need that starts
the product development process
24. Investment: : As used in economics, spending on capital goods such as factories,
mines, and machinery so as to increase the productive capacity of the economy.In
its broader meaning, investment is any purchase of an asset to increase future
income.
25. Investment capital: : (start-up) Initial investment capital necessary for starting a
business usually consisting of inventory, equipment, pre-opening expenses, and
leaseholds.
26. Invention: : The creation of a new technology, item, or process, as opposed to
its application in widespread use.
27. Intrapreneurship: : The application of entrepreneurial skills and approaches
within or by a corporation.
28. Interest: : The cost incurred in borrowing and using someone else's money
or, alternatively, the income earned by allowing others to use your money.
29. Intellectual property : Any patents, trademarks, copyright, or trade secrets held by
the entrepreneur
30. Innovation: : The use of a new technology, item, or process to change what
goods and services are provided, the way they are produced, or the way they are
distributed.
31. Idea: : A new, creative approach to specifically addressing a perceived
opportunity (a need, want, problem or challenge).
32. Horizontal merger: : Combination of at least two firms doing similar businesses
at the same market level
33. High-potential ventures: : A venture that has high growth potential and
therefore receives great investor interest
34. 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.
35. Government as an innovator: : A government active in commercializing
technology
36. Gazelles: : Very high growth ventures.
37. Foundation companies: : A type of company formed from research and
development that usually does not go public.
38. Entrepreneurship: : Involves the recognition of opportunities (needs, wants,
problems, and challenges) and the use of resources to implement innovative ideas
for new, thoughtfully planned ventures.
39. Entrepreneurial domain: : The ways entrepreneurs make decisions
40. Entrepreneurial decision process: : Deciding to become an entrepreneur by
leaving present activity
41. Entrepreneur: : A person who engages in the process of entrepreneurship.
42. Entrepreneur as an innovator: : An individual developing something unique
43. Efficiency: : The most effective use or allocation of resources to yield the
maximum benefits. 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, management, machinery and new technology) to
achieve the lowest possible production cost for their products. 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, or to
achieve a distribution of the output of society that results in the greatest degree of
satisfaction.
44. 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, after adjusting for inflation; since population is
constantly changing, a more precise measure is the rate of growth of real per
capita income.
45. Diversified activity merger: : Combination of at least two totally unrelated firms
46. Desirability of new venture formation: : Aspects of a situation that make it
desirable to start a new company.
47. Depreciation: : A method of calculating and writing off the costs of fixed
assets, such as machinery, buildings, trucks, and equipment. Investment in such
fixed assets, which wear out or become obsolete over time, is a normal expense of
business.
48. Demand: : The combined desire, ability and willingness on the part of
individuals to acquire or make use of a good or service. Demand is determined by
income and by price, which is, in part, determined by supply.
49. Corporate culture: : The environment of a particular organization
50. 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. 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, in what quantities, and at what price.
51. 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. The cash-
flow projection will highlight periods of cash shortage and potential need for
credit
52. Capitalist: : A person who owns shares in a business enterprise.
53. Capital: : 1. In economics, one of the factors of production that is essential to
the functioning of the economy. It represents the mines, factories, machinery, and
other capital goods that are used to produce goods and services and on which
income is earned. The capital in an economy increases as new investments are
made from the profits earned on existing capital. 2. In financial markets, the funds
available for investment in financial assets such as shares, bonds, certificates of
deposit, or real property. 3. In business, the total funds invested in the company to
enable it to carry out its activities.
54. 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.
55. Business: : The production of goods or services for profit. Such activity can be
carried out by an individual, a family, a partnership, or an incorporated company.
56. Business plan: : The description of the future direction of the business
57. Business ethics: : The study of behavior and morals in a business situation
58. Breakthrough innovations: : A new product with some technological change
59. Asset: : Anything that can be sold, on which a money value hence can be
placed. In a balance sheet, everything that an organization owns that can be
expressed as a dollar value is listed. Assets include, for example, land, buildings,
machinery, inventories, patents, cash, investments in other companies, money
owed, etc.
60. Administrative domain: : The ways managers make decisions
61. 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. Accounts receivable are included on the balance sheet under current
assets.
62. Accounts payable: : The outstanding bills of an enterprise; money owed to
suppliers for goods and services purchased for the normal operations of the
venture. Accounts payable are included on the balance sheet under current
liabilities.
63. Accountant: : A person who carries out bookkeeping, auditing, and other
financial reporting and analysis. This is a generic term referring to a wide range of
skills from semi-clerical to highly trained professional work.