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Entrepreneurship And Small Business Certification Exam Questions And Answers 2024
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Entrepreneurship And Small BusinessCertification Exam Questions And
Answers 2024
Elements of the Design Thinking Process - Correct Answer-Stage 1: Emphasize-
Research Your Users' Needs
Stage 2: Define- State Your Users' Needs and Problems
Stage 3: Ideate- Challenge Assumptions and Create Ideas
Stage 4: Prototype- Start to Create Solutions
Stage 5: Test- Try Your Solutions Out
Difference between small businesses and entrepreneurs? - Correct Answer-Small
businesses are not always interested in taking on new business opportunities.
Entrepreneurs set up a business with the aim to make a profit.
Compensation Types - Correct Answer-1. Piece work- compensation on a per-unit
basis. EX: an employer can choose to pay mechanics a fixed rate for each vehicle they
repair instead of paying an hourly rate.
2. Salary- employee receives a set amount of pay each month without overtime
compensation for extra hours worked.
3. Hourly- Employees most affected by minimum wage laws are compensated hourly.
4. Commission- An employee who is paid a percentage of a sale.
5. Equity- Non-cash compensations offered to employees in place of or in addition to a
lower salary.
Types of Sales Channel - Correct Answer-1. Business-to-Business (B2B): a transaction
or business conducted between one business and another, such as a wholesaler and
retailer. Transactions tend to happen in the supply chain, where one company will
purchase raw materials from another to be used in the manufacturing process.
2. Business-to-Consumer (B2C): process of businesses selling products/services
directly to consumers, with no middle person.
Typically refers to online retailers who sell products/services to consumers through the
Internet.
Online B2C became a threat to traditional retailers, who profited from adding a markup
to the price.
3. Retail: sell items or services to customers. They typically sell items in-store or may be
sold online.
, 4. Wholesale: the act of buying goods in bulk from a manufacturer at a discounted price
and selling to a retailer for a higher price, for them to repackage and in turn resell in
smaller quantities at an even higher price to consumers.
Acquisition Costs - Correct Answer-These costs include shipping, sales taxes, and
customs fees, as well as the costs of site preparation, installation, and testing. When
acquiring property, acquisition costs can include surveying, closing fees, and paying off
liens.
Angel Investor - Correct Answer-a wealthy private investor who provides capital for a
business start-up for a stake in the business in return.
Asset - Correct Answer-A tangible item a business owns. They can generate revenue or
be converted into cash. They can be physical items, such as machinery, or intangible,
such as intellectual property.
Balance Sheet - Correct Answer-A financial statement used for evaluating the
performance of a business. It compares ASSETS to LIABILITIES plus owner's EQUITY
on a specific date.
EX:
Equipment- Long term assets
Bank loans- Current liabilities
Inventory- Current assets
Mortgage payments- Long term liabilities
Bootstrapping - Correct Answer-A TYPE OF FUNDING. A business owner that uses
their own money to fund their business.
Break-Even Point - Correct Answer-The point where a business's revenue matches its
expenses over a given period. AKA there is no loss or gain for your small business;
you've reached the level of production at which the costs of production equals the
revenues for a product.
Break-Even Point = Fixed Cost / (selling price per unit - variable cost per unit)
Budget - Correct Answer-The amount of money a business plans on spending during a
given period.
Burn Rate - Correct Answer-A calculation used to measure a business's monthly cash
flow. AKA the amount of $ your business needs in a certain period (usually a month) to
cover all expenses. In other words, burn rate tells you how quickly your business "burns
through" capital. This calculation helps business owners understand how long they can
continue to operate at this rate before running out of money.
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