Question 1

Small businesses play an important role in the economic growth of any country

Accepted Answer

Small businesses contribute significantly to the economy by creating jobs, fostering innovation, and stimulating local economies through the circulation of money within communities.

Question 2

Small businesses in U.S. employ about half of America's private-sector employees

Accepted Answer

Small businesses in the U.S. are a significant part of the economy, employing about half of the nation's private-sector workforce, according to data from the Small Business Administration (SBA).

Question 3

Most small businesses in U.S. are single-person firms with no employees

Accepted Answer

Most small businesses in the U.S. are indeed single-person firms, meaning they have no paid employees, operating primarily as sole proprietorships.

Question 4

A small business is defined as one that is independently owned, operated, and is nationally dominated in its field of operation; and has less than 150 employees

Accepted Answer

A small business is defined as one that is independently owned and operated, but not necessarily nationally dominated in its field of operation. The specific number of employees can vary by country, but the definition does not universally require less than 150 employees.

Question 5

To classify a firm as a small business, the SBA counts employment at the firm level

Accepted Answer

The answer of To classify a firm as a small...

Question 6

According to the Small Business Administration, a small business is the one that has less than 50 employees

Accepted Answer

The Small Business Administration (SBA) defines a small business based on industry-specific size standards, which can include metrics like annual receipts or the number of employees, and these standards often exceed 50 employees depending on the industry.

Question 7

Small businesses file more patents per employees than large businesses

Accepted Answer

Small businesses tend to file more patents per employee than large businesses because they often focus on innovation and niche markets, relying on patents to protect their competitive edge.

Question 8

The minimum legal age requirement for starting a new business in U.S is 18 years

Accepted Answer

There is no federal minimum age requirement to start a business in the U.S., but individuals under 18 may face restrictions, such as needing a guardian to sign legal documents.

Question 9

Small firms and large corporations have a symbiotic relationship

Accepted Answer

Small firms often supply niche products, services, or innovations to larger corporations, while large corporations provide small firms with significant market opportunities, resources, or platforms for growth, creating a mutually beneficial relationship.

Question 10

The Paycheck Protection Program (PPP) is a loan designed for large corporations to
provide compensation to their executives

Accepted Answer

The Paycheck Protection Program (PPP) was designed to provide loans to small businesses to keep their workers on the payroll during the COVID-19 pandemic, not for large corporations to compensate executives.

Question 11

Businesses recognized as large are eligible for SBA's loan programs

Accepted Answer

The Small Business Administration (SBA) primarily supports small businesses, so large businesses are generally not eligible for SBA's loan programs.

Question 12

According to the text, entrepreneurship involves identifying and pursuing new opportunities to introduce novel goods and services to the market

Accepted Answer

Entrepreneurship indeed involves the process of identifying and pursuing new opportunities to create value by introducing innovative goods and services to the market.

Question 13

Small businesses and entrepreneurship are complementary

Accepted Answer

Small businesses and entrepreneurship are complementary because entrepreneurship involves creating and managing new businesses, which often start as small businesses. This relationship supports innovation, economic growth, and job creation.

Question 14

Owners of lifestyle businesses do not need to improve products and operations

Accepted Answer

Owners of lifestyle businesses still need to improve products and operations to stay competitive and meet the changing needs of their customers.

Question 15

The large firms that stop growing at some point are known as whales

Accepted Answer

The term "whales" is not commonly used to describe large firms that stop growing; instead, terms like "mature companies" or "legacy companies" might be used to describe firms that have reached a plateau in growth.

Question 16

The term 'gazelle' is used for those entrepreneurial small firms that have high rates of growth

Accepted Answer

The term 'gazelle' refers to small, fast-growing companies that are characterized by their rapid expansion and development, often outpacing their competitors in terms of revenue and job creation.

Question 17

A credit policy that is too lenient can cause collection and cash-flow problems later for small businesses

Accepted Answer

A too lenient credit policy can lead to delayed payments and defaults, causing cash-flow issues and difficulties in managing collections for small businesses.

Question 18

Entrepreneurship is a born trait and cannot be learned

Accepted Answer

Entrepreneurship involves a set of skills and attitudes that can be developed and nurtured over time through education, experience, and practice.

Question 19

One should start a business ONLY when the demand for its goods or services is high

Accepted Answer

While high demand can indicate a good opportunity, starting a business also depends on factors like competition, market saturation, unique value proposition, and the entrepreneur's ability to meet and sustain that demand. Timing, resources, and long-term vision are also crucial considerations.

Question 20

A growth mindset stipulates that one's skills and qualities are mutable

Accepted Answer

The answer of A growth mindset stipulates that one's skills...

Quiz 1: Understanding Small Business