Entrepreneurship and Small Business (ESB) Certification Practice Exam

Disable ads (and more) with a membership for a one time $2.99 payment

Prepare for the Entrepreneurship and Small Business Certification Exam with engaging quizzes. Use flashcards and multiple choice questions, each with detailed hints and explanations. Enhance your entrepreneurial skills and ace your exam!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

Which statement best describes the relationship between business longevity and funding opportunities?

Older businesses are less trustworthy
Business longevity often leads to greater access to funding
Younger businesses are favored by lenders
Longevity has no impact on funding

The correct answer is: Business longevity often leads to greater access to funding

The statement that business longevity often leads to greater access to funding is accurate because lenders and investors typically view established businesses with a history of operations as less risky compared to newer startups. An older business usually has proven revenue streams, a track record of financial performance, and established customer relationships, which can reassure potential funders about the likelihood of repayment or the success of the venture. Furthermore, long-standing businesses may have developed credibility and trust within their industry and community, enabling them to negotiate more favorable terms with financial institutions. This relationship between time in the market and access to funding reflects the importance of stability and reliability that funders seek when making investment decisions. In contrast to this, younger businesses may lack the same history, making them less attractive for funding opportunities despite potentially having innovative ideas or products.