Business

Question 1

What is the purpose of a business ?

Answer 1

To provide customers with a good or a service

Question 2

What is a service ?

Answer 2

A service is when someone does something for you like a bus journey

Question 3

What is a good ?

Answer 3

Something you can physically touch for example a pen

Question 4

Name four factors of production

Answer 4

Land
Labour
Enterprise
Capital

Question 5

What is an entrepreneur ?

Answer 5

Someone who has an initial business idea

Question 6

List 3 characteristics of a entrepreneur

Answer 6

Risk taker
Determination
Courage

Question 7

Name the three business sectors

Answer 7

Primary
Secondary
Tertiary

Question 8

Name the four business functions

Answer 8

Marketing
Operations
Finance
Human Resource

Question 9

Define Private sector businesses

Answer 9

These are owned by individuals who are aiming to make a profit and shares are only sold to friends and family

Question 10

Define Public sector businesses

Answer 10

These are owned by the government and usually provide a useful service for people and shares are sold publicly

Question 11

Name the 5 business ownership options

Answer 11

Sole trader 
Partnership 
Private limited company 
Public limited company 
Social enterprise

Question 12

Define what a stakeholder is

Answer 12

Someone or a group of people who share an interest in a business

Question 13

Name the two ways businesses grow

Answer 13

Externally

Internally

Question 14

How can a business grow Externally

Answer 14

A merge or takeover

Question 15

Define interest rates

Answer 15

It is the cost of borrowing money or the reward for saving money

Question 16

Name the three types of goods a customer can choose from

Answer 16

Inferior
Luxury
Normal

Question 17

What is legislation ?

Answer 17

Legislation is a set of rules that govern the way society operates

Question 18

Define risk

Answer 18

The possibility of something going wrong

Question 19

Name the three types of production

Answer 19

Job
Flow
Lean

Question 20

Define logistics

Answer 20

Logistics refers to the movement of goods, services, information and money throughout the production process

Question 21

Name two benefits of locating oversea

Answer 21

cheaper labour and easier access to resources

Question 22

What is digital communication

Answer 22

Any use of laptops, tablets and smartphones to transfer information is known as digital communication

Question 23

What is meant by economy ?

Answer 23

The economy is made up of consumers, businesses and the government. They make decisions on what to buy, sell, produce, import from overseas amd where to work

Question 24

give examples of a growing economic climate

Answer 24

Rising levels of spending, employment and production

Question 25

give examples of a weakening economic climate

Answer 25

falling levels of spending, employment and production

Question 26

What is a business plan

Answer 26

A business plan is a document setting out what a business does and what it hopes to achieve in the future

Question 27

Why make a business plan ?

Answer 27

Help set up a business successfully Raise finance Set objectives

Question 28

What are problems with business planning ?

Answer 28

Lack of experience Change Risk

Question 29

What are the main sections of a business plan?

Answer 29

Background info on founders and investors and their previous experience An analysis of the market and the firm’s expected position within it, as well as target customers Firm’s objectives Price and expected sales

Question 30

Define franchise

Answer 30

A franchise is the existing business that allows someone to use their business name to sell goods or services.

Question 31

Define franchisor

Answer 31

The franchisor for a fee will provide equipment, premises, support and training

Question 32

Define franchisee

Answer 32

A franchisee is the person that asks permission to trade under an existing business name

Question 33

Define E-commerce

Answer 33

E-commerce is the act of buying a product using an electronic system such as the internet

Question 34

What are the five p's in a business

Answer 34

``` Place Person Price Product promotion ```

Question 35

What is economies of scale ?

Answer 35

Economies of scale occur when a business’s unit costs of production fall as output rises and the business expands

Question 36

What is diseconomies of scale ?

Answer 36

diseconomies is the opposite and occur when unit costs increases as business expands