Economics Exam

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What is enterprise?
Enterprise is the business that the entreprenuer creates
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What three trates are needed to be an entrepreneur
Risk taking, Showing initiative and willingness for new ventures
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What is risk taking?
Enterprise involves an element of risk. If theyhave been planned for, they are usually easier to manage and address
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What is showing inititative?
It is about making the first move, developing creative solutions to problems and thinking outside the box
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What is willingness for new ventures
To be on the lookout for new opportunities. Should have courage to quit ventures that are less successful and pursue more successful ones
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Three sources of business ideas?
Business experience, Personal experience or observations
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Why is creative thinking important?
Gain competitive advantage, challenge entrepreneurs and keeps a business fresh
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Three examples of deliberate creativity?
Mindmaps, lateral thinking and blue skies thinking
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What does the red hat signify?
(Feelings) is about gut instinct, no reasons are given, hunches
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What does the yellow hat signify?
(Optimism) Positives, plus points, why the idea is useful
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What does the black hat signify?
(Cautions) Negitivity, why something wont work
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What does the green hat signify?
(creativity) thinks of new ideas, solutions, alternatives
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What does the white hat signify?
(Facts) calls for information, stats, etc
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What does the blue hat signify?
(Thinking about thinking) manages the thinking process.
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Definition of invention?
The discovery of new processes and potential new products, typically after a period of research
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Definition of inonovation?
Improving an existing product, process or invention
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What is product innovation?
Launching new/improved products or services onto the market
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What is process innovation?
Finding better?more efficent ways of producing existing products/services
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What is invention innovation?
Traansforming inventions into marketable products that can be sold
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Three advantages of innovation?
Attracts new/repeat customers, competitive advantage and strong reputation/brand image
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Three disadvantes of innovation?
Can be expensive, takes time, failure to live up to media hype
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What do patents protect?
Inventions/innovations from being stolen, only apply to technology products/processes
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What do copyrights protect?
Applies to music, film, book, etc (art)
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What do trademarks protect?
Business names, logos, colours, etc
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Why are business start ups risky?
There is a high rate of business failure in start ups (80% fail in 1st year), competitive response is aggressive, easy to be over- optimistic
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Three main reasons why start-ups fail?
insufficent customer demand, good idea but poor execution, external shocks
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What is a calculated risk?
A risk that has been given thoughtful consideration and for which the potential costs and benefits have been considered
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Examples of financial rewards?
Profits,dividends and capital growth
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Examples of non-financial rewards?
being in control, satisfaction and getting good feedback
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What is viability?
the outcome of risk analysis. It helps the decision of whether to go ahead or not
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What three trates are needed to be an entrepreneur


Risk taking, Showing initiative and willingness for new ventures

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What is risk taking?


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What is showing inititative?


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What is willingness for new ventures


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