1.   Define small business, discuss its importance, and explain 
              popular areas of small business.
         2.   Explain entrepreneurship and describe some key 
              characteristics of entrepreneurial personalities
         3.   Describe the start-up decisions made by small businesses 
              and identify sources of financial aid available to such 
              enterprises.
         4.   Discuss the trends in small business start-ups and identify 
              the main reasons for success and failure among small 
              businesses.
         5.   Explain sole proprietorships, partnerships, and 
              Corporations and discuss the advantages and 
              disadvantages of each.
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                             Copyright © 2015 Pearson Education, Inc.     3-2 
                                 Publishing as Prentice Hall 
                            What Is a “Small” Business?
         • Small business 
                –one that is independent (not part of a larger 
                    business) and that has relatively little 
                    influence in its market.
                –Examples: Locally owned and operated 
                    restaurants, dry cleaners, car repair shops, 
                    and hair salons.
                –The U.S. Department of Commerce considers 
                    a business “small” if it has fewer than 500 
                    employees.
                                                   Copyright © 2012 Pearson Education, 
                                                  Copyright © 2015 Pearson Education, Inc.                                       3-3 
                                                      Inc. Publishing as Prentice Hall 
                          The Importance of Small Business
                                                     Job creation
                                                     Job creation
                                                        Innovation
                                                        Innovation
                                          Contributions to big 
                                          Contributions to big 
                                                          business
                                                          business
                                                   Copyright © 2012 Pearson Education, 
                                                  Copyright © 2015 Pearson Education, Inc.                                       3-4 
                                                      Inc. Publishing as Prentice Hall 
                                                     Job Creation
         • Small businesses have accounted for 
              about 40 percent of all new jobs in high-
              technology sectors of the economy.
                                                   Copyright © 2012 Pearson Education, 
                                                  Copyright © 2015 Pearson Education, Inc.                                       3-5 
                                                      Inc. Publishing as Prentice Hall 
                                                        Innovation
         • Major inventions are likely to come from 
              small businesses.
         • People worked in small businesses 
              invented the personal computers, the 
              stainless razor blade, the photocopier, the 
              jet engine …. etc 
                                                   Copyright © 2012 Pearson Education, 
                                                  Copyright © 2015 Pearson Education, Inc.                                       3-6 
                                                      Inc. Publishing as Prentice Hall