Business Test2

Question 1

Define: partnership

Answer 1

Business is owned and controlled by two or more people.

Responsibilities and distribution of profits/losses are outlined in partnership agreement.

Question 2

Define: Corporation

Answer 2

Corporation is a separate legal entity from it’s owners. A corporation often has shareholders who own stock. These people own a small percentage of the business but don’t run the business.

Question 3

Define: loan

Answer 3

Borrowing money to start a business and having to pay interest.

Question 4

Define: investor

Answer 4

Someone who gives you money to start or grow a business but takes a percentage of your business

Question 5

Define: entrepreneur

Answer 5

Individual who comes up with new business ideas and takes the risk to start a new business

Question 6

Define: producers

Answer 6

Producers create the products and services used by individuals and other businesses

Question 7

Name the two type of producers

Answer 7

Extractor-takes resources from nature such as mining, timber, oil, farming

Manufacture- get supplies from other producers and convert them into products such as automotive companies, construction businesses etc

Question 8

Define: intermediaries

Answer 8

Intermediaries- businesses involved in selling goods/services from producers. They don’t make the product, they just buy it and resell it.

Question 9

Define: service businesses

Answer 9

Businesses that offer an intangible service, they do not sell a product. Examples include dentist, doctors, lawyers, painters, etc

Question 10

Names the three types of businesses

Answer 10

Producers
Intermediaries
Service businesses

Question 11

Define: Mission statement

Answer 11

Short, specific statement of the reason a business exist and what it wants to achieve.

Question 12

Define:Goals

Answer 12

Precise statement of results a business wants to achieve. Goals can be used to judge whether a business is successful or unsuccessful.

Question 13

Define: policies

Answer 13

Guidelines used to make consistent decisions

Example: policies might include guidelines within the business (coming to work late, raises, etc) or outside the business (dealing with costumers-refunds complaints, etc)

Question 14

Define: procedures

Answer 14

Descriptions of the way work should be done.

Example: a procedure for subway might be: what order you put meat and vegetables on the sandwich

Question 15

Define: responsibility

Answer 15

All employees understand their responsibilities and what is expected of them

Question 16

Define-authority

Answer 16

All employees know they can make decisions as to how to accomplish their responsibilities

Question 17

Define-accountability

Answer 17

all employees are held responsible for their actions

Question 18

Define unity of demand

Answer 18

Clear reporting relationship for all employees

Question 19

Define-span of control

Answer 19

Number of employees assigned to a certain task and manager

Question 20

Define-organizational chart

Answer 20

Diagram that shows the structure of the business, how jobs are classified, and the relationship among employees.
Two types:
Functional structure
Matrix structure

Question 21

Define- functional structure

Answer 21

People with jobs related to one another work together (all accountants work together, all sales people work together)

Question 22

Define: matrix structure

Answer 22

Employees are organized around specific projects or customers instead of by job titles.

Question 23

Define: business plan

Answer 23

Written description of the business idea, how it will be carried out, including all major business activities

Question 24

Define: Sole Proprietorship

Answer 24

Business is owned and controlled by one individual. Most common form of business structure.

Question 25

Define: target market

Answer 25

the consumers at which a product is aimed (ex. College students, young families, women over the age of 50, etc.)

Question 26

Key characteristics to identify about your target market:

Answer 26

- demographics (age, gender, ethnicity, income, etc.) - size and location of target market - lifestyle - needs/wants → are they being met? - is your product/service a need/want? - any seasonal/cyclical trends?

Question 27

Define-marketing

Answer 27

the actions of promoting or advertising your product/service

Question 28

Brand Awareness –

Answer 28

Brand Awareness – the extent to which a brand is recognized by potential customers

Question 29

What are the six business activities?

Answer 29

1. Generating ideas 2. Raising capital 3. Employing and training personnel 4. Buying goods and services 5. Marketing goods and services 6. Maintaining business records

Question 30

Explain: generating ideas

Answer 30

Businesses must begin with a new idea or a better way of doing something (price, quality, convenience, etc.)

Question 31

Explain more about what it means to raise capital: | 6 business activities

Answer 31

Businesses need financial resources ($$$) to operate and pay for day to day needs. A large amount of money is needed to start a business – loans or investors Money is needed to keep a business running

Question 32

Tell more about employing and training personnel: | 6 business activities

Answer 32

Businesses need well-trained human resources to succeed. Most businesses have procedures for recruiting, hiring, and training employees. Types of training – 1) On the Job Training, 2) Computer Training, 3) Training Center, 4) Orientation

Question 33

Explain more about buying goods and services | Six business activities

Answer 33

All businesses buy goods and services. Some are used within the business and others are resold.

Question 34

Tell about marketing goods and services

Answer 34

Marketing refers to activities that a business uses to advertise their goods or services What types of advertising are there? Which do you think are most effective? TV, infomercial, radio, print (newspaper/magazine), billboards/signs, email, direct mail, internet, social media, in-store

Question 35

Explain more about maintaining business records | Six business activities

Answer 35

All businesses must have some sort of recordkeeping system Records to keep track of: - income/expenses/wages (required) - performance - past decisions - sales/marketing results

Question 36

What does a SMART goals stand for?

Answer 36

``` Specific Measurable Attainable Relevant Time-oriented ```

Question 37

Describe more about the SMART goals

Answer 37

Does anyone know what the acronym SMART stands for? Specific – Goals are well-defined and focused Measureable – How much? How many? Easy to answer yes/no Attainable – goal is not set too high or too low Relevant – choosing goals that matter to the business Time-Oriented – set a target date for goals

Question 38

Understand: about ideas, business experience, and experience managing people

Answer 38

A successful business begins with an idea and previous experience - hobbies - interests - business experiences Managing people (employees) is a critical past experience that can help a new business owner succeed

Question 39

Understand about team approach in running a business

Answer 39

Many people who start a new business want to be independent, but a team approach is critical to success ``` •Employees •Assistance from outside sources -bankers -lawyers -accountants ```

Question 40

Understand about right time and place

Answer 40

Finding the right place and time to open a new business is critical Place can have two meanings - city or rural area where you start your business - location within the town or rural area Timing – successful businesses start when the demand for their product/service is high

Question 41

Understand about preparation and research

Answer 41

Enough information needs to be gathered to make good decisions about the business - saves time and money later - helps avoid problems -information is available on the internet, through libraries, from universities, and small business assistance centers

Question 42

Name the six keys to starting a successful business

Answer 42

``` Idea Business experience Experience managing people Right place and time Team approach Preparation and research ```

Question 43

Name four different parts of the business outline

Answer 43

Vision and mission. a. Mission statement and goals Market analysis a. Who will buy your goods and services? Is it a want or a need b. What's your businesses target market? Organizational chart a. Who are your employees and managers? b. What does your organizational chart look like Marketing plan. a. The four P's of marketing- price, product, promotion, place

Question 44

What is the four P's of marketing/ marketing mix ?

Answer 44

1) Product 2) Price 3) Place 4) Promotion