unit 1 Flashcards
(27 cards)
What is the primary purpose of a business?
To provide goods or services to meet the needs of customers.
True or False: A business can operate without a profit motive.
True
Fill in the blank: The four factors of production are land, labor, capital, and ______.
enterprise
What is ‘enterprise’ in the context of business activity?
The ability to combine the other factors of production to create goods or services.
What does ‘goods’ refer to in business?
Physical items that can be touched and sold.
What are ‘services’ in a business context?
Intangible products that cannot be touched, such as consulting or repairs.
What is the difference between a need and a want?
A need is essential for survival, while a want is a desire for something that is not necessary.
True or False: Businesses only exist in the private sector.
False
What is the term for the process of creating a new product?
Product development
What is the role of a business plan?
To outline the goals, strategies, and financial forecasts of a business.
What does the term ‘market research’ mean?
The process of gathering information about consumers’ needs and preferences.
Multiple Choice: Which of the following is NOT a type of business ownership? A) Sole proprietorship B) Partnership C) Franchise D) Nonprofit
D) Nonprofit
What is a ‘sole trader’?
A business owned and operated by one individual.
Fill in the blank: A ________ is a legal entity separate from its owners.
company
What is a ‘partnership’?
A business structure where two or more individuals share ownership and responsibilities.
True or False: Limited liability protects owners’ personal assets from business debts.
True
What is the purpose of a ‘mission statement’?
To define the core purpose and focus of a business.
What does ‘profit’ mean?
The financial gain after all expenses have been subtracted from revenue.
What is ‘revenue’?
The total income generated from sales of goods or services before any expenses are deducted.
Multiple Choice: Which of the following is a disadvantage of a sole trader? A) Full control B) Unlimited liability C) Easy to set up D) Simple taxation
B) Unlimited liability
What is the term for the amount of money a business needs to start and operate?
Capital
What does ‘entrepreneurship’ involve?
The process of designing, launching, and running a new business.
Fill in the blank: A _______ is an individual who starts a new business, bearing most of the risks and enjoying most of the rewards.
entrepreneur
