A Review of Small Business Successes and Failures Indicates That

question 186

Multiple Choice

A review of small business successes and failures indicates that the:

• A)businesses that are easiest to start offer the greatest potential for long term growth and profits.
• B)reason the service sector is rapidly growing is that these firms are easy to start and keep going,and offer high levels of security and growth potential.
• C)restaurant industry offers the least risk for entrepreneurs.
• D)businesses with the potential of high profit levels tend to be difficult to start and hard to keep going.

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Definitions:

Required Return

The minimum profit or yield that investors expect or require from an investment.

Interest

The cost of borrowing money or the income earned from lending money, usually expressed as a percentage of the principal.

Coupon Rate

Yearly interest earnings from a bond, shown as a percentage of its face value.

Par Value

A nominal value assigned to a share of stock as indicated in the corporate charter, not necessarily reflecting its market value.