Ent. I Unit 2 Test Review

Which is the primary reason for governments to regulate business activities?

• To encourage businesses to expand their operations
• To limit the level of competition in the marketplace
• To protect the well-being of individuals and businesses
• initiatives

Which is a major advantage of a sole proprietorship?

• Availability of capital
• Ease of start-up
• Probability of success
• Sharing of decision making

A business that fails to protect its employees from unnecessary risk or health hazards on the job may be sued for which situation?

• Incompetence
• Misrepresentation
• Libel
• Negligence

Which statement is most likely to have a negative effect on domestic small-business growth?

• Involuntary tax reductions
• Restrictive loan policies
• Low interest rates
• Slow inflation

Local governments strongly promote and support small businesses mainly due to which factor?

• Businesses serve only the local communities.
• Businesses are owned by one person.
• Businesses may become big businesses.
• Businesses are important to the economy.

Which positive effect do small businesses have on the local community?

• Reduction of competition
• Pay in of taxes
• Limitation on job growth
• Charging of interest

Which statement is true about entrepreneurship and small-business growth?

• Trade regulations have very little effect on small-business growth.
• Many people start entrepreneurial ventures during times of economic recession.
• Small business start-ups are taxed at a higher rate than multinational companies.
• Consumer spending is a primary factor that influences entrepreneurial success.

The entrepreneurial discovery process requires knowledge and the recognition of a(n): 

• market need
• economic crisis
• preventable accident
• creative obsession

Which of the following is a true statement about a business's environment?

• it can be avoided
• it is always changing
• it consists of the economy and technology
• it may not affect the business, depending on the industry.

Which of the following is an example of a demographic trend?

• the gender of a group of people
• shifting political climates
• rising interest rates
• a concern for how you look