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ESB Certification Exam Study Guide with Complete Solutions 2024
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ESB Certification Exam Study Guidewith Complete Solutions 2024
Domain 1 Lesson 1 - Correct Answer-
The key objective of a small business owner is to generate ____ - Correct Answer-
profits
Entrepreneurs are willing to take on new opportunities and unknown ____ to grow their
businesses rapidly - Correct Answer-risks
Tangible items that require pick-up or delivery are ____ products - Correct Answer-
physical
When a ____ purchases an item from a business, it is a business-to-consumer
transaction - Correct Answer-customer
____ are for-profit corporations with limited liability - Correct Answer-S corporations
____ are ideal for international businesses - Correct Answer-C corporations
The ____ oversees daily operational and administrative functions - Correct Answer-
Chief Operating Officer
A ____ votes on the management of a company - Correct Answer-stockholder
____ employees are paid a fixed amount each pay period - Correct Answer-Salary
Businesses can compensate employees for work they produce when being paid by
____ - Correct Answer-piece work
Businesses can offer ____ in addition to a lower salary - Correct Answer-equity
During the ____ stage of the business life cycle, a company is regularly taking on new
customers and starting to generate a consistent income - Correct Answer-survival
The owner may decide to sell their ownership in the company during the ____ stage -
Correct Answer-exit plan
The five elements of the design thinking process are ____ - Correct Answer-empathize,
define, ideate, prototype , and test
____ allows one to see and experience a customer's perspective - Correct Answer-
Empathy
,The design team creates multiple inexpensive versions of a product, known as ____ -
Correct Answer-Minimum Viable Products
Name benefits of a franchise - Correct Answer-less risk involved, tested operational
processes, or recognized brands
No ownership, no US federal taxes - Correct Answer-Non-profit
Best for international business even with being double-taxed - Correct Answer-C
corporation
Easy to create but comes with unlimited liability - Correct Answer-Sole proprietorship
Lower tax rate that prevents the company from being double-taxed - Correct Answer-S
corporation
Ideal for a single owner seeking low risk - Correct Answer-LLC (limited liability
company)
Shared financial backing - Correct Answer-Partnership
Creates the company - Correct Answer-Founder
Oversees company finances - Correct Answer-CFO
Owns stock in the company - Correct Answer-Stockholder
Reports to the board of directors - Correct Answer-CEO
Oversees daily operational and administrative functions Stakeholder Has a vested
interest in the success of the company - Correct Answer-COO
Has a vested interest in the success of the company - Correct Answer-Stakeholder
Non-cash compensation - Correct Answer-Equity
Set rate of pay for hours worked - Correct Answer-Hourly
Usually found in sales roles - Correct Answer-Commission
Set amount of pay in a given period - Correct Answer-Salary
List the correct order of the business life cycle stages - Correct Answer-Existence,
Survival, Success, Take-off, Resource maturity, Pivot or persist, Exit plan
, Michael owns a small but profitable tech company. He has been approached by a larger
company that wants to purchase his business. In which business life cycle stage is
Michael? - Correct Answer-Exit Plan
Bill just started a new graphic design business. He is advertising online and trying to
gain customers. He just finished working with his first client. In which business life cycle
stage is Bill? - Correct Answer-Existence
Stephanie started a new flower shop last year. She has a good customer base and
money coming in. In which business life cycle stage is Stephanie? - Correct Answer-
Survival
List the correct order of the design thinking process - Correct Answer-Empathize,
Define, Ideate, Prototype, Test
During which stage of the design thinking process will the design team create multiple
inexpensive product versions? - Correct Answer-Prototype
During which stage of the design thinking process is a problem statement formed? -
Correct Answer-Define
Which stage of the design thinking process involves learning about customers'
challenges? - Correct Answer-Empathize
Domain 1 Lesson 2 - Correct Answer-
____ is the amount of loss one is willing to take when making an investment decision -
Correct Answer-Risk tolerance
Having a ____ mindset means believing that one can accomplish anything through hard
work - Correct Answer-growth
An example of an ____ risk is a natural disaster - Correct Answer-environmental
A business opportunity is an ____ that lets a buyer start a business - Correct Answer-
investment
A ____ needs to be obtained to use a brand name on products - Correct Answer-license
The five factors that determine the viability of a business opportunity are ____,
relationships, cash flow management, management skillsets, and passion - Correct
Answer-market size
A business plan helps a business achieve short-term and long-term ____ - Correct
Answer-goals
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