Entrepreneurship & Small Business V.2
UPDATED Exam Questions and
CORRECT Answers
What is Entrepreneurship? - CORRECT ANSWER- Setting up a business with the aim to
make a profit.
You need to create a legal structure for your small business. You would like some of the
benefits enjoyed by large corporations, but do not want to be taxed twice. You have four
partners who will be shareholders. None of you plan to sell your ownership shares to the
public, but do want to be protected from business liabilities. Which legal structure should you
set up for your business? - CORRECT ANSWER- S-Corporation
Business Life Cycle: - CORRECT ANSWER- Stage 1: Existence
Stage 2: Survival of the fittest
Stage 3: Success
Stage 4: Take-Off
Stage 5: Maturity
Design Thinking Process: - CORRECT ANSWER- Step 1: Empathize
Step 2: Define
Step 3: Ideate
Step 4: Prototype
Step 5: Test
In general, which two characteristics define a "small" business? - CORRECT ANSWER- -
Less than $35.5 million revenue
- Fewer than 1,500 employees
You need to create a legal structure for your small business. You have plans for it to grow and
hope in the future to sell shares to the public. Your startup partners are citizens of Mexico and
, Japan. You do not want to be personally responsible for business liabilities. What legal
structure should you set up for your business? - CORRECT ANSWER- C-Corporation
CEO - CORRECT ANSWER- The highest-ranking employee in the company; reports to the
board of directors.
CFO - CORRECT ANSWER- Creates budgets, analyzes financial data, and forecasts
company profits.
CIO - CORRECT ANSWER- Develops policies and structures to protect company data.
COO - CORRECT ANSWER- Oversees the day-to-day administrative functions of a
business; second in comand.
You own a lawn care business. You have employees who work long hours laboring in good
weather, often exceeding 40 hours per week. They also work short hours when the weather is
bad, sometimes they can't work at all. You do all of the sales for your business. Which two
types of compensation would be appropriate for these landscape employees? - CORRECT
ANSWER- Hourly & Salary
Maturity - CORRECT ANSWER- The business is separate from the owner with
responsibilities delegated to staff. A business in this stage usually commands a considerable
share of the market and may even be a household name.
Success - CORRECT ANSWER- Company is stable and profitable.
Success
Takeoff - CORRECT ANSWER- Expansion strategies are implemented, and investment is
balanced with potential.
Takeoff
Survival of the Fittest - CORRECT ANSWER- Focus shifts to revenue, expenses, and
growth. Cashflow is the major issue.
Survival of the Fittest
UPDATED Exam Questions and
CORRECT Answers
What is Entrepreneurship? - CORRECT ANSWER- Setting up a business with the aim to
make a profit.
You need to create a legal structure for your small business. You would like some of the
benefits enjoyed by large corporations, but do not want to be taxed twice. You have four
partners who will be shareholders. None of you plan to sell your ownership shares to the
public, but do want to be protected from business liabilities. Which legal structure should you
set up for your business? - CORRECT ANSWER- S-Corporation
Business Life Cycle: - CORRECT ANSWER- Stage 1: Existence
Stage 2: Survival of the fittest
Stage 3: Success
Stage 4: Take-Off
Stage 5: Maturity
Design Thinking Process: - CORRECT ANSWER- Step 1: Empathize
Step 2: Define
Step 3: Ideate
Step 4: Prototype
Step 5: Test
In general, which two characteristics define a "small" business? - CORRECT ANSWER- -
Less than $35.5 million revenue
- Fewer than 1,500 employees
You need to create a legal structure for your small business. You have plans for it to grow and
hope in the future to sell shares to the public. Your startup partners are citizens of Mexico and
, Japan. You do not want to be personally responsible for business liabilities. What legal
structure should you set up for your business? - CORRECT ANSWER- C-Corporation
CEO - CORRECT ANSWER- The highest-ranking employee in the company; reports to the
board of directors.
CFO - CORRECT ANSWER- Creates budgets, analyzes financial data, and forecasts
company profits.
CIO - CORRECT ANSWER- Develops policies and structures to protect company data.
COO - CORRECT ANSWER- Oversees the day-to-day administrative functions of a
business; second in comand.
You own a lawn care business. You have employees who work long hours laboring in good
weather, often exceeding 40 hours per week. They also work short hours when the weather is
bad, sometimes they can't work at all. You do all of the sales for your business. Which two
types of compensation would be appropriate for these landscape employees? - CORRECT
ANSWER- Hourly & Salary
Maturity - CORRECT ANSWER- The business is separate from the owner with
responsibilities delegated to staff. A business in this stage usually commands a considerable
share of the market and may even be a household name.
Success - CORRECT ANSWER- Company is stable and profitable.
Success
Takeoff - CORRECT ANSWER- Expansion strategies are implemented, and investment is
balanced with potential.
Takeoff
Survival of the Fittest - CORRECT ANSWER- Focus shifts to revenue, expenses, and
growth. Cashflow is the major issue.
Survival of the Fittest
