SMALL BUSINESS MANAGEMENT EXAM 1 QUESTIONS AND
ANSWERS
Which of the following is a reason for starting a small business? - CORRECT ANSWER✅✅to satisfy
personal objectives
Which of the following is true about the first stage of the typical growth pattern that small businesses
tend to follow? - CORRECT ANSWER✅✅owners manage the business and do all the work
refers to the process of reducing the number of employees to increase efficiency - CORRECT
ANSWER✅✅rightsizing
With advances in technology, many tasks in the health care industry are now performed by highly paid
and skilled workers. - CORRECT ANSWER✅✅false
Smaller firms tend to - CORRECT ANSWER✅✅keep larger firms competitive
Which of the following is a reason for the drastic changes in small business management trends? -
CORRECT ANSWER✅✅Improvements in communications and computer technology
which of the following features must a business have to be classified as small? - CORRECT
ANSWER✅✅Management is independent, and the area of operation is primarily local.
Which of the following best describes one of the contributions of small businesses - CORRECT
ANSWER✅✅They are sources of new ideas or services that larger businesses may be unable to provide
Which of the following is a major reason for the increased interest in small business? - CORRECT
ANSWER✅✅There is a growing trend toward self-employment.
Which of the following is the result of the trend in business to become more active globally? - CORRECT
ANSWER✅✅A growing number of large and small U.S. businesses are or are becoming foreign owned.
,A new small business owner's primary motive is usually ____ - CORRECT ANSWER✅✅independence,
that is, freedom from interference or control by superiors
A _____ is any business that is independently owned and operated and is not dominant in its field of
operation. - CORRECT ANSWER✅✅small business
Which of the following is true about the final stage of the typical growth pattern that small businesses
tend to follow? - CORRECT ANSWER✅✅Owners hire managers to run the firms
Those interested in small business management need to understand what the challenge of being active
globally is and what the rewards may be - CORRECT ANSWER✅✅true
Employees in large workplaces have higher job satisfaction than those in smaller firms. - CORRECT
ANSWER✅✅false
With so much time, money, and energy devoted to the business, small business owners tend to have
more zeal and devotion than do managers of big companies - CORRECT ANSWER✅✅true
_____ is the fundamental redesign of a business, often resulting in reduction in size and markets. -
CORRECT ANSWER✅✅reinvention
The reality that small businesses train people to become better leaders and managers and to develop
their talents and energies more effectively has led more college graduates to seek full-time jobs with
small businesses - CORRECT ANSWER✅✅true
Which of the following statements is true about small businesses? - CORRECT ANSWER✅✅The
manager usually owns the business
Which of the following is a problem faced by small businesses today? - CORRECT
ANSWER✅✅Unexpected growth and financing issues
, Which of the following statements is true about small businesses? - CORRECT ANSWER✅✅inadequate
management in small businesses creates problems for small business owners and entrepreneurs
One of the causes of discontinuance or failure is that the amount of time and/or physical effort
demanded of the small business manager was not recognized and/or planned for - CORRECT
ANSWER✅✅true
Mark opened a café in his neighborhood. Soon his café became very popular, and his revenues started
increasing. Steve, the owner of a popular restaurant, saw Mark's success and asked him to join his
restaurant. The financial incentive that Steve offered Mark was more than what he earned at his café.
Moreover, Mark would not have to face the daily hassles of managing everything on his own. Mark
decided to shut down his café and join the restaurant. This is an example of - CORRECT
ANSWER✅✅discontinuance
The length of service of professional managers (as opposed to owner-managers) in small businesses
tends to be relatively long - CORRECT ANSWER✅✅flase
While the usual incubation period of a business is two to three years, 30 percent of incubator clients
typically graduate each year. - CORRECT ANSWER✅✅true
An entrepreneurial venture is characterized by - CORRECT ANSWER✅✅innovative strategic practices
and/or products
Which of the following statements is true about failure and small businesses? - CORRECT ANSWER✅✅A
discontinuance may result from the apparent advantages of working for someone else.
Most of the growing industries are dominated by large companies. - CORRECT ANSWER✅✅false
Which of the following is the main goal of an incubation program? - CORRECT ANSWER✅✅Produce
businesses that are financially viable and freestanding
In formal failures, an owner who cannot succeed voluntarily terminates the business - CORRECT
ANSWER✅✅false
ANSWERS
Which of the following is a reason for starting a small business? - CORRECT ANSWER✅✅to satisfy
personal objectives
Which of the following is true about the first stage of the typical growth pattern that small businesses
tend to follow? - CORRECT ANSWER✅✅owners manage the business and do all the work
refers to the process of reducing the number of employees to increase efficiency - CORRECT
ANSWER✅✅rightsizing
With advances in technology, many tasks in the health care industry are now performed by highly paid
and skilled workers. - CORRECT ANSWER✅✅false
Smaller firms tend to - CORRECT ANSWER✅✅keep larger firms competitive
Which of the following is a reason for the drastic changes in small business management trends? -
CORRECT ANSWER✅✅Improvements in communications and computer technology
which of the following features must a business have to be classified as small? - CORRECT
ANSWER✅✅Management is independent, and the area of operation is primarily local.
Which of the following best describes one of the contributions of small businesses - CORRECT
ANSWER✅✅They are sources of new ideas or services that larger businesses may be unable to provide
Which of the following is a major reason for the increased interest in small business? - CORRECT
ANSWER✅✅There is a growing trend toward self-employment.
Which of the following is the result of the trend in business to become more active globally? - CORRECT
ANSWER✅✅A growing number of large and small U.S. businesses are or are becoming foreign owned.
,A new small business owner's primary motive is usually ____ - CORRECT ANSWER✅✅independence,
that is, freedom from interference or control by superiors
A _____ is any business that is independently owned and operated and is not dominant in its field of
operation. - CORRECT ANSWER✅✅small business
Which of the following is true about the final stage of the typical growth pattern that small businesses
tend to follow? - CORRECT ANSWER✅✅Owners hire managers to run the firms
Those interested in small business management need to understand what the challenge of being active
globally is and what the rewards may be - CORRECT ANSWER✅✅true
Employees in large workplaces have higher job satisfaction than those in smaller firms. - CORRECT
ANSWER✅✅false
With so much time, money, and energy devoted to the business, small business owners tend to have
more zeal and devotion than do managers of big companies - CORRECT ANSWER✅✅true
_____ is the fundamental redesign of a business, often resulting in reduction in size and markets. -
CORRECT ANSWER✅✅reinvention
The reality that small businesses train people to become better leaders and managers and to develop
their talents and energies more effectively has led more college graduates to seek full-time jobs with
small businesses - CORRECT ANSWER✅✅true
Which of the following statements is true about small businesses? - CORRECT ANSWER✅✅The
manager usually owns the business
Which of the following is a problem faced by small businesses today? - CORRECT
ANSWER✅✅Unexpected growth and financing issues
, Which of the following statements is true about small businesses? - CORRECT ANSWER✅✅inadequate
management in small businesses creates problems for small business owners and entrepreneurs
One of the causes of discontinuance or failure is that the amount of time and/or physical effort
demanded of the small business manager was not recognized and/or planned for - CORRECT
ANSWER✅✅true
Mark opened a café in his neighborhood. Soon his café became very popular, and his revenues started
increasing. Steve, the owner of a popular restaurant, saw Mark's success and asked him to join his
restaurant. The financial incentive that Steve offered Mark was more than what he earned at his café.
Moreover, Mark would not have to face the daily hassles of managing everything on his own. Mark
decided to shut down his café and join the restaurant. This is an example of - CORRECT
ANSWER✅✅discontinuance
The length of service of professional managers (as opposed to owner-managers) in small businesses
tends to be relatively long - CORRECT ANSWER✅✅flase
While the usual incubation period of a business is two to three years, 30 percent of incubator clients
typically graduate each year. - CORRECT ANSWER✅✅true
An entrepreneurial venture is characterized by - CORRECT ANSWER✅✅innovative strategic practices
and/or products
Which of the following statements is true about failure and small businesses? - CORRECT ANSWER✅✅A
discontinuance may result from the apparent advantages of working for someone else.
Most of the growing industries are dominated by large companies. - CORRECT ANSWER✅✅false
Which of the following is the main goal of an incubation program? - CORRECT ANSWER✅✅Produce
businesses that are financially viable and freestanding
In formal failures, an owner who cannot succeed voluntarily terminates the business - CORRECT
ANSWER✅✅false
