Are You a Business Expert?

Understanding Business and Entrepreneurship

• Success in business involves finding a need and filling it, providing goods, jobs, and services to the community.
• A business is any activity that seeks to provide goods and services to others while operating at a profit.
• An entrepreneur is a person who risks time and money to start and manage a business.
• Revenue is the total amount of money received during a given period for goods sold and services rendered, while profit is the amount of money a business earns above and beyond its expenses.
• Losses occur when a business's expenses are more than revenues, which can lead to business closure if sustained over a longer period.
• Risk refers to the chance of loss, the degree of probability of loss, and the amount of possible loss when starting a business that might not be profitable.
• Thorough research is necessary to find the right balance between risk and profit when starting a business.
• Stakeholders are all people who stand to gain or lose by the policies and activities of a business, including customers, investors, employees, financial institutions, government and environmentalists, suppliers, trade unions, and media.
• Offshoring and outsourcing are strategies used to stay competitive in business, involving the relocation of business processes from one region or country to another or contracting with other companies to do some or all of the functions of a firm.
• There are advantages and disadvantages to being an employee or an entrepreneur, including earning potential, independence, flexibility, and job security.
• Economists have identified five factors that contribute to wealth creation: land, labour, capital goods, entrepreneurship, and knowledge.
• Each source of wealth creation plays a significant role in producing goods and services that contribute to the general well-being of a society in terms of its political freedom, natural environment, education, health care system, amount of leisure, and rewards that add to the satisfaction and joy that other goods and services provide.