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Question 12 of 20:

Select the best answer for the question.
12. What percentage of new businesses fail in the first year?
OA. 25 percent
OB. 75 percent
OC. 60 percent
OD. 40 percent
2
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E

User Liquid
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2 Answers

1 vote
75 percent of businesses fail in the first year
User Alex Semeniuk
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4 votes
The correct answer is:
OC. 60 percent

According to various studies, about 60% of new businesses fail in the first year. Some key statistics:

• A U.S. Small Business Administration study found that about 60% of new businesses fail within the first 2 years.

• A study by CB Insights found that about 59% of tech startups fail in the first 2 years.

• Research by economists Brian Headd and Marc Reuben found that about 50-60% of new businesses do not survive beyond 5 years.

• Crunchbase tracks technology companies and found that about 57% of startups fail within 10 years.

So most research and studies point to a failure rate of 50-60% for new businesses, especially in the critical first year.

Choices A, B and D are not supported by these statistics and studies on new business failure rates.
Only choice OC, 60 percent, is a reasonably accurate estimate according to the available data.

Therefore, the best answer for this question is:
OC. 60 percent

Did this help explain the choice? Let me know if any part is unclear or if you have any other questions!
User Kibria
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