Business Exam

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What is the purpose of business activity?
Provide goods and services/ make profit OR identify consumer needs and produce something that satisfies it, all of it with the aim of making a profit
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What are the factors of production?
Land, Labor, Capital, Enterprise
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What is the difference between creating value and added value?
Creating Value: Increasing the difference between the price bought in material and the price of sold goods. Added Value: The difference between bought in materials and the price of goods sold
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What is the problem of choice/ opportunity cost?
No one can satisfy all of their needs and wants. We are left always wanting more which leaves us to make choices and the things we forego for something else is the opportunity cost or lost opportunity
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Who is an Entrepreneur?
Someone who takes financial risks of starting and managing a new venture.
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What are the characteristics of a successful entrepreneur?
Innovation, Commitment/self-motivation, Multi-skilled, Leadership skills, Self confidence and fast recovery, Risk taking
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What are the major challenges faced by the entrepreneur?
Sourcing capital, Determining a location, Competition, Building a customer base
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Why do new businesses often fail?
Lack of record keeping, Lack of working capital/cash, Poor management skills, Changes in the business environment
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What are the 3 types of businesses?
Primary: Farming/fishing; Secondary: Factories, Manufacturing; Tertiary: Services
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What are the impact of enterprise on a country economy?
Economic growth, employment creation, Firms' survival and growth, Innovation and technological change, Exports (more exports improve country's international competitiveness), Inspiration for other potential enterprises, Increased social cohesion
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What is social enterprise?
A business with mainly social objectives that reinvests most of its profits into benefiting society rather than maximizing returns to owners.
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What is triple bottom line?
Three objectives of social enterprise: economic, social and environmental
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Explain triple bottom line.
ECONOMIC: make profit to invest back into the business and provide some return to owners. SOCIAL: Provide jobs or support for local, often disadvantaged, communities. ENVIRONMENTAL: Manage the business in an environmentally sustainable way
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Other cards in this set

Card 2

Front

What are the factors of production?

Back

Land, Labor, Capital, Enterprise

Card 3

Front

What is the difference between creating value and added value?

Back

Preview of the front of card 3

Card 4

Front

What is the problem of choice/ opportunity cost?

Back

Preview of the front of card 4

Card 5

Front

Who is an Entrepreneur?

Back

Preview of the front of card 5
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