Lesson 1

Question 1

What is innovation

Answer 1

Innovation is changing an existing product to make it better

Question 2

What is an entrepreneur

Answer 2

An entrepreneur is someone who sets up a business in hope of profit

Question 3

Revenue

Answer 3

Sales x Saleprice (math) definition is the money that you take into your business.

Question 4

Fixed costs

Answer 4

Costs that don’t change

Question 5

Variable costs

Answer 5

Costs that change depending on the amount of products sold

Question 6

Profit

Answer 6

Revenue - total costs.

Question 7

Dividends

Answer 7

A portion of money that goes to the investors and is normally paid quaterly based on the companies recent earnings

Question 8

What is a creditor

Answer 8

The lender of money who’s owed money buy the debtor

Question 9

What is added value

Answer 9

Added value is the increase in a product’s value as a result of a business producing a product

Question 10

What is differentiation

Answer 10

Differentiation is making a product unique in its industry

Question 11

What is a USP

Answer 11

Unique selling point

Question 12

What is the marketing mix

Answer 12

Price, product, promotion, place

Question 13

What is bias

Answer 13

Bias is preference for no reason without facts or evidence

Question 14

What is a product life cycle

Answer 14

Introduction, growth, maturity and decline

Question 15

Disposable income

Answer 15

Amount of money received after tax

Question 16

What is segmentation

Answer 16

Segmentation is the process of breaking up the market into different groups

Question 17

Market leader

Answer 17

The company with the largest market share

Question 18

Profit margin

Answer 18

Profit margin is how much money made - all costs

Question 19

Inflows

Answer 19

Where money is going into the business

Question 20

Outflows

Answer 20

Where money is going out of the business

Question 21

Crowdfunding

Answer 21

Where people invest into the business and in turn the business will give something back such as discounts

Question 22

Venture capitalist

Answer 22

Investors who provide money to startup companies in return for a share in the business. E.g the dragons on dragons den.

Question 23

Trade credit

Answer 23

This is when a business buys goods but delays payment of goods until a later scheduled date

Question 24

Opportunity cost

Answer 24

The potential profit lost by choosing one option over the other

Question 25

Shareholder

Answer 25

Someone who owns a share of the business

Question 26

Limited liability

Answer 26

If your business goes into unrepayable debt the bank won’t seize your personal assets

Question 27

Unlimited liability

Answer 27

If your business goes into debt and the business can’t pay it off the bank can seize your assets to pay the debt off.

Question 28

Incorporated

Answer 28

This is turning your business into its own separate legal entity

Question 29

Function

Answer 29

What the product should do and how well it does it

Question 30

Aesthetics

Answer 30

How the products appeals to customers

Question 31

Recession

Answer 31

A period of a significant decline in economic activity that lasts longer than a few months

Question 32

Productivity

Answer 32

This is how efficiently a business turns input into output

Question 33

Efficiency

Answer 33

The ability to achieve an end goal with as little time, effort or resources needed

Question 34

Discrimination

Answer 34

Treating someone unfairly because of who they are

Question 35

GDP

Answer 35

Gross Domestic Product- which is a measure of all economic activities in a country

Question 36

Appreciation

Answer 36

The increase in value of an asset over time

Question 37

Depreciation

Answer 37

Depreciation is the decrease in value of an asset over time

Question 38

Interest

Answer 38

% amount of money that is added onto your saving account and amount of extra money per year you have to pay for borrowing

Question 39

DETERMINATION

Answer 39

Determination