1. What is an entrepreneur?
A person who only watches television and never works
A government official who makes laws
A person who starts and runs a business and accepts its risks
A teacher who only teaches in school
Explanation:
An entrepreneur is someone who begins and manages a business, taking financial and other risks to make it succeed.
2. What is an enterprise?
A type of government office
A school subject only for older students
A business that provides goods or services to earn income
A place where people only go for recreation
Explanation:
An enterprise is an organization (small or large) that produces goods or offers services to make money or meet community needs.
3. Which of these is a common micro enterprise in Kenyan towns?
The county government's main office
A national bank headquarters
A small kiosk selling groceries and snacks
A large manufacturing factory
Explanation:
Kiosks are typical micro enterprises in Kenya, run by individuals selling everyday items to local customers.
4. Why do many entrepreneurs start businesses?
To avoid helping their community
To earn income and make a profit
To make sure they never meet customers
To stop learning new things
Explanation:
A key reason for starting a business is to generate income for the owner and sometimes create jobs.
5. Which of the following is NOT a good characteristic of an entrepreneur?
Being hardworking and persistent
Being lazy and avoiding work
Being willing to take calculated risks
Being creative and finding solutions
Explanation:
Successful entrepreneurs are usually hardworking, creative and willing to take risks; being lazy would prevent business success.
6. What does the term 'capital' mean for a business?
Money and assets used to start and run a business
The total number of products sold in a day
The building where students study
Only the customers who visit a shop
Explanation:
Capital includes cash, equipment and other resources that help a business operate and grow.
7. What is profit?
The amount of sleep an owner gets
The total number of customers in a market
A list of items the business sells
Money left after paying business costs from the sales income
Explanation:
Profit is what remains when expenses are subtracted from the revenue earned by the business.
8. Who is a customer?
A teacher who only gives lessons in class
A person who buys goods or services from a business
A bank manager who never visits the market
A person who builds roads for the county
Explanation:
Customers are people or organizations that purchase what a business offers.
9. Which of the following is an example of a service?
Buying maize flour from a kiosk
Selling tomatoes at a market stall
Selling a bar of soap from a shop
Giving a haircut at a salon
Explanation:
A haircut is a service because it is an action performed for a customer rather than a physical product.
10. Why is record keeping important for a small business?
To know how much money is earned and spent and to make better decisions
To make the shop look bigger without selling anything
To make sure the owner never counts money
To stop customers from buying goods
Explanation:
Good records show sales, expenses and profits so the owner can plan, pay taxes and improve the business.
11. Which of these is an example of a business risk?
Having too many customers every day
Low sales during a slow season
Getting a free gift from a friend
The business making extra profits
Explanation:
Low sales reduce income and can harm a business; knowing risks helps entrepreneurs plan for them.
12. What does innovation mean in entrepreneurship?
Creating new or better ideas, products or ways of doing things
Copying someone else without changes
Only selling the same old items without improvement
Refusing to try anything different
Explanation:
Innovation helps businesses stand out by offering improved products or methods that meet customer needs.
13. Which government action can help entrepreneurs in Kenya?
Increasing rules so no one can sell anything
Closing all small shops and markets
Stopping people from learning business skills
Providing training and support to register and start small businesses
Explanation:
Governments can help by offering training, grants or simpler registration processes that make it easier to start and run enterprises.
14. What is a target market?
A list of things the owner dislikes
The group of customers a business wants to sell to
The number of workers in the business
A place where targets are sold
Explanation:
A target market is the specific group of people who are most likely to buy a product or service.
15. Which of these is an example of a startup cost?
Buying materials and equipment needed to begin the business
Sleeping at home instead of working
Eating at a friendβs house unrelated to the business
Going on a holiday before opening the shop
Explanation:
Startup costs are the initial expenses like buying stock, equipment or rent needed to open the business.
16. Why is saving important for an entrepreneur?
To spend all money on celebrations
To hide money so it is never used
To have funds for emergencies, to grow the business or buy new stock
To avoid investing in the business
Explanation:
Savings help entrepreneurs handle slow months, replace worn equipment and expand when opportunities arise.
17. What is a sole proprietorship?
A business owned and run by one person
A company run by a large group of strangers
A business owned by the whole government
A shop that never sells anything
Explanation:
A sole proprietorship is the simplest business type where one person is responsible for all decisions and profits.
18. How can an entrepreneur attract customers?
By increasing prices without improving anything
By offering good quality goods or services and telling people through simple advertising
By hiding the business so no one finds it
By never answering the phone or serving people
Explanation:
Good quality plus communication (like posters, word-of-mouth or social media) helps bring customers to the business.
19. What is the break-even point in a business?
When the shop is closed for a holiday
When total sales equal total costs and the business makes no profit or loss
When the business earns only losses every day
When the owner spends all the money on personal items
Explanation:
Break-even is the level of sales where income covers all costs; beyond this point the business starts making profit.
20. Which of these belongs in a simple business plan?
A schedule for watching television daily
A list of games to play during school break
A record of only family chores
A description of the product or service, who will buy it and how costs will be met
Explanation:
A business plan explains what you will sell, your customers, how you will sell it and how money will be managed.
21. What does sustainability mean for a business?
The business can continue operating over time without harming people or the environment
Only opening the business for one day and never again
Using all resources quickly without planning
Making as much waste as possible
Explanation:
Sustainable businesses plan for long-term success while caring for workers, customers and natural resources.
22. Why do entrepreneurs need to pay taxes?
Because taxes are optional for everyone
To follow the law and support public services like roads and schools
To hide their income from everyone
So the business can never open
Explanation:
Paying taxes is a legal duty that helps fund public services which also benefit businesses and communities.
23. How does teamwork help a small business?
It means everyone does nothing and waits
It shares tasks and ideas so work gets done faster and better
It causes constant arguments and no progress
It makes the business more expensive to run for no reason
Explanation:
Teamwork allows people to use different skills, support each other and improve business operations.
24. What is social entrepreneurship?
A government office that gives orders
A shop that closes every day
A business that only focuses on making the owner richer at others' expense
A business that aims to solve social problems while earning income
Explanation:
Social entrepreneurs start ventures that address community issues (like clean water or education) while remaining financially sustainable.
25. What is marketing?
Keeping all products hidden so no one buys them
A way to increase prices without providing value
Only saving money under a mattress
Activities that tell people about and help sell products or services
Explanation:
Marketing includes advertising, packaging and talking to customers so they learn about and choose the business's offerings.