Why Is It So Difficult to Turn Around a Small

question 86

Multiple Choice

Why is it so difficult to turn around a small business whose performance is declining?

• A)Small businesses have limited slack resources.
• B)Government regulations on small businesses limit the ability to innovate.
• C)Economic issues, such as the interest rate charged on loans, make it difficult to get the loans needed to overcome problems.
• D)None of these

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Definitions:

Invisible-Hand

A term coined by Adam Smith to describe the self-regulating nature of the marketplace, where individual self-interest inadvertently benefits society at large.

Command Economy

An economic system where the government or central authority makes all decisions regarding the production and distribution of goods and services.

Centralized Authority

A system of organization where decision-making and power are concentrated at a single point or in a single group within the organization.

Government Intervention

Actions taken by a government to influence or regulate various activities within its economy, including markets, industries, and social policies, to achieve desired outcomes.