Low Barriers to Entry for Small Businesses

Steps:

• Identify the question: Factors allowing hairdressers to run small-scale operations.
• Evaluate options: Focus on economic barriers like costs, competition, and scale.
• Eliminate mismatches: Rule out factors that hinder small businesses.
• Select best fit: Choose the enabler of easy entry and low overhead.

Why D is correct:

• Low start-up and running costs reduce barriers to entry, allowing individuals to launch small businesses with minimal capital, as defined in microeconomics where low fixed costs support sole proprietorships.

Why the others are wrong:

• A: High competition discourages new small entrants by increasing failure risk.
• B: High economies of scale favor large firms, making small operations inefficient.
• C: Long training raises entry barriers, limiting small business formation.

Final answer: D