ESB Certification Exam Study Guide
Domain 1 Lesson 1 - ✔ ✔
The key objective of a small business owner is to generate ____ - ✔ ✔ profits
Entrepreneurs are willing to take on new opportunities and unknown ____ to grow their businesses
rapidly - ✔ ✔ risks
Tangible items that require pick-up or delivery are ____ products - ✔ ✔ physical
When a ____ purchases an item from a business, it is a business-to-consumer transaction - ✔ ✔
customer
____ are for-profit corporations with limited liability - ✔ ✔ S corporations
____ are ideal for international businesses - ✔ ✔ C corporations
The ____ oversees daily operational and administrative functions - ✔ ✔ Chief Operating Officer
A ____ votes on the management of a company - ✔ ✔ stockholder
____ employees are paid a fixed amount each pay period - ✔ ✔ Salary
Businesses can compensate employees for work they produce when being paid by ____ - ✔ ✔ piece
work
,Businesses can offer ____ in addition to a lower salary - ✔ ✔ equity
During the ____ stage of the business life cycle, a company is regularly taking on new customers and
starting to generate a consistent income - ✔ ✔ survival
The owner may decide to sell their ownership in the company during the ____ stage - ✔ ✔ exit plan
The five elements of the design thinking process are ____ - ✔ ✔ empathize, define, ideate,
prototype , and test
____ allows one to see and experience a customer's perspective - ✔ ✔ Empathy
The design team creates multiple inexpensive versions of a product, known as ____ - ✔ ✔ Minimum
Viable Products
Name benefits of a franchise - ✔ ✔ less risk involved, tested operational processes, or recognized
brands
No ownership, no US federal taxes - ✔ ✔ Non-profit
Best for international business even with being double-taxed - ✔ ✔ C corporation
Easy to create but comes with unlimited liability - ✔ ✔ Sole proprietorship
Lower tax rate that prevents the company from being double-taxed - ✔ ✔ S corporation
, Ideal for a single owner seeking low risk - ✔ ✔ LLC (limited liability company)
Shared financial backing - ✔ ✔ Partnership
Creates the company - ✔ ✔ Founder
Oversees company finances - ✔ ✔ CFO
Owns stock in the company - ✔ ✔ Stockholder
Reports to the board of directors - ✔ ✔ CEO
Oversees daily operational and administrative functions Stakeholder Has a vested interest in the success
of the company - ✔ ✔ COO
Has a vested interest in the success of the company - ✔ ✔ Stakeholder
Non-cash compensation - ✔ ✔ Equity
Set rate of pay for hours worked - ✔ ✔ Hourly
Usually found in sales roles - ✔ ✔ Commission
Set amount of pay in a given period - ✔ ✔ Salary
Domain 1 Lesson 1 - ✔ ✔
The key objective of a small business owner is to generate ____ - ✔ ✔ profits
Entrepreneurs are willing to take on new opportunities and unknown ____ to grow their businesses
rapidly - ✔ ✔ risks
Tangible items that require pick-up or delivery are ____ products - ✔ ✔ physical
When a ____ purchases an item from a business, it is a business-to-consumer transaction - ✔ ✔
customer
____ are for-profit corporations with limited liability - ✔ ✔ S corporations
____ are ideal for international businesses - ✔ ✔ C corporations
The ____ oversees daily operational and administrative functions - ✔ ✔ Chief Operating Officer
A ____ votes on the management of a company - ✔ ✔ stockholder
____ employees are paid a fixed amount each pay period - ✔ ✔ Salary
Businesses can compensate employees for work they produce when being paid by ____ - ✔ ✔ piece
work
,Businesses can offer ____ in addition to a lower salary - ✔ ✔ equity
During the ____ stage of the business life cycle, a company is regularly taking on new customers and
starting to generate a consistent income - ✔ ✔ survival
The owner may decide to sell their ownership in the company during the ____ stage - ✔ ✔ exit plan
The five elements of the design thinking process are ____ - ✔ ✔ empathize, define, ideate,
prototype , and test
____ allows one to see and experience a customer's perspective - ✔ ✔ Empathy
The design team creates multiple inexpensive versions of a product, known as ____ - ✔ ✔ Minimum
Viable Products
Name benefits of a franchise - ✔ ✔ less risk involved, tested operational processes, or recognized
brands
No ownership, no US federal taxes - ✔ ✔ Non-profit
Best for international business even with being double-taxed - ✔ ✔ C corporation
Easy to create but comes with unlimited liability - ✔ ✔ Sole proprietorship
Lower tax rate that prevents the company from being double-taxed - ✔ ✔ S corporation
, Ideal for a single owner seeking low risk - ✔ ✔ LLC (limited liability company)
Shared financial backing - ✔ ✔ Partnership
Creates the company - ✔ ✔ Founder
Oversees company finances - ✔ ✔ CFO
Owns stock in the company - ✔ ✔ Stockholder
Reports to the board of directors - ✔ ✔ CEO
Oversees daily operational and administrative functions Stakeholder Has a vested interest in the success
of the company - ✔ ✔ COO
Has a vested interest in the success of the company - ✔ ✔ Stakeholder
Non-cash compensation - ✔ ✔ Equity
Set rate of pay for hours worked - ✔ ✔ Hourly
Usually found in sales roles - ✔ ✔ Commission
Set amount of pay in a given period - ✔ ✔ Salary
