1.1.2 risk and reward

Question 1

Business
failure

Answer 1

If a business fails to plan for the
future it may risk losing out to
competitors

Question 2

What is the chance of failure in
a new start-up?

Answer 2

20% of small businesses fail in their
first year
30% of small business fail in their
second year

Question 3

Financial risks

Answer 3

The owner may put their own
cash and other assets (e.g. a
van) into a business

Question 4

Lack of security

Answer 4

If an entrepreneur has a
regular job, and they decide
to leave that job to open
their own business this is a
huge risk

Question 5

Definition: Business rewards

Answer 5

Not everyone defines reward the same way. For
some it might be seeing a new venture grow and
succeed. For others it may be conquering the
unknown and striking out on their own

Question 6

Business success

Answer 6

This may mean; awards,
fame, survival, growth or
making more money than
they would working for
someone else

Question 7

Keep all the profit

Answer 7

A reward of setting up your own
business is you get to keep all
the profit that the business
makes

Question 8

Independence

Answer 8

A reward of setting up your own business is that you could be your
own boss
Being your own boss means you get to make the major decisions in
the business