SME Questions with Complete
Correct Answers | Grade A+
Micro enterprises
Ans: < 10 employees
< 2 million in turnover
< 2 million in assets
Small enterprises
Ans: < 50 employees
< 10 mln in revenues
< 10 mln in assets
Medium enterprises
Ans: < 250 employees
< 50 mln in revenues
< 42 mln in total assets
Focused or niche strategies
Ans: The conventional strategies for SMEs
,1) They guide innovative processes - they make the economy grow
2) They create wealth and jobs
3) They establish a "cultural atmosphere" geared towards change, innovation and the
construction of the common good.
Ans: Three reasons why entrepreneurs represent an irreplaceable resource for economic
development:
1) central role of the entrepreneur
2) family ownership
3) occasional development of resources and capabilities
4) predominance of informal planning and emerging strategies
5) firm's positioning in a limited competitive scope
Ans: Elements that characterise SMEs:
Fragmented industry
Ans: Numerous competitors, none of which has a significant market share: no firm can
significantly influence the behaviour of other players or overall industry performance.
Gini Index
, Ans: An indicator of equality/inequality of income distribution among firms in the industry.
Two variables are used: industry concentration and market share of the first n firms.
Concentrated industry
Ans: Where the first four firms hold a combined market share of 40% or more.
Economic factors limiting industry concentration
Ans: - Absence of economies of scale
- High incidence of transport costs
- Erratic fluctuations in sales
- No size advantage in contractual relations with customer/supplier
- Diseconomies of scale in certain key activities
- A high degree of product customization
- Economic and/or managerial barriers to exit
- Local legislation that imposes conformity to certain standards
- A government ban on concentration
Key advantages of small firms
Ans: - Flat organisational structures
- Flexible organisational structures
Correct Answers | Grade A+
Micro enterprises
Ans: < 10 employees
< 2 million in turnover
< 2 million in assets
Small enterprises
Ans: < 50 employees
< 10 mln in revenues
< 10 mln in assets
Medium enterprises
Ans: < 250 employees
< 50 mln in revenues
< 42 mln in total assets
Focused or niche strategies
Ans: The conventional strategies for SMEs
,1) They guide innovative processes - they make the economy grow
2) They create wealth and jobs
3) They establish a "cultural atmosphere" geared towards change, innovation and the
construction of the common good.
Ans: Three reasons why entrepreneurs represent an irreplaceable resource for economic
development:
1) central role of the entrepreneur
2) family ownership
3) occasional development of resources and capabilities
4) predominance of informal planning and emerging strategies
5) firm's positioning in a limited competitive scope
Ans: Elements that characterise SMEs:
Fragmented industry
Ans: Numerous competitors, none of which has a significant market share: no firm can
significantly influence the behaviour of other players or overall industry performance.
Gini Index
, Ans: An indicator of equality/inequality of income distribution among firms in the industry.
Two variables are used: industry concentration and market share of the first n firms.
Concentrated industry
Ans: Where the first four firms hold a combined market share of 40% or more.
Economic factors limiting industry concentration
Ans: - Absence of economies of scale
- High incidence of transport costs
- Erratic fluctuations in sales
- No size advantage in contractual relations with customer/supplier
- Diseconomies of scale in certain key activities
- A high degree of product customization
- Economic and/or managerial barriers to exit
- Local legislation that imposes conformity to certain standards
- A government ban on concentration
Key advantages of small firms
Ans: - Flat organisational structures
- Flexible organisational structures
