Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
It eliminates all risks associated with new ventures.
B
It allows entrepreneurs to test hypotheses quickly, reducing the time and cost of product development.
C
It focuses only on financial metrics to measure success.
D
It relies solely on traditional market research before launching products.
Understanding the Answer
Let's break down why this is correct
Answer
Lean Startup treats the unknown parts of a new business as a learning problem, not just a risk. It uses rapid prototyping to create small, inexpensive versions of a product or service, then tests them with real customers to gather data. By analyzing that data, entrepreneurs validate whether their assumptions are correct, allowing them to stop or pivot quickly instead of wasting time and money. This cycle of building, measuring, and learning keeps risk low and often leads to faster, more profitable outcomes.
Detailed Explanation
The Lean Startup lets entrepreneurs test small ideas fast, learn from real feedback, and adjust before spending much money or time. Other options are incorrect because The method does not remove every risk; The method is not only about money.
Key Concepts
validated learning
rapid prototyping
entrepreneurial risk management
Topic
Performance Impact of Lean Startup
Difficulty
hard level question
Cognitive Level
understand
Practice Similar Questions
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Question 4How does the Lean Startup methodology primarily impact firm performance over time?
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Question 8How does the Lean Startup methodology utilize validated learning and rapid prototyping to manage entrepreneurial risk, and what is its impact on performance outcomes?
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Question 9How does the Lean Startup Methodology ensure the viability of a business idea during early development?
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Question 10A startup has implemented the lean startup methodology by continually testing their product ideas with potential customers before fully launching them. Which category does this approach belong to in terms of performance impact?
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