chp 5

Question 1

Home-based businesses

Answer 1

Many small businesses are home based due to
access to the Internet and the availability of
communication devices.

Question 2

What is a small business?

Answer 2

small businesses account for approximately 97% of Canadian firms. A small business is generally
defined as an independent business with
fewer than 100 employees, and revenues less
than $2 million.

Question 3

Typical small-business ventures

Answer 3

nearly all industries, but account for
more than two-thirds of employment in five
Canadian industry categories: non-institutional
health care, construction, accommodation and
food, forestry, and other services.

Question 4

Home-based businesses

Answer 4

Many small businesses are home based due to
access to the Internet and the availability of
communication devices.

Question 5

Sole proprietorships

Answer 5

single
individual, considered the simplest and most
common form of business.

Question 6

What advantages do small businesses bring to the Canadian economy?
What disadvantages must successful small businesses overcome?

Answer 6

Small business brings greater competition to the Canadian economy. It also
creates new jobs, is a source of innovation, and fills isolated market niches.
Small businesses often operate at lower costs than larger businesses because
of lower overhead and staffing costs. Lower overhead is often the benefit of
opening a business from the home. Lower staffing costs can occur when
entrepreneurs and their families work without insisting on being paid for every
hour contributed. Still, small business faces many difficulties which must be
overcome. First, it is often difficult to raise adequate capital for a small
business enterprise. Also, many small businesses suffer from lack of
management skills. And government paperwork and red tape are a particular
burden to small businesses with their small staffs.

Question 7

inventor

Answer 7

build something amazing