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Questions and Answers
What is an entrepreneur?
What is an entrepreneur?
A person who organises, operates and takes the risk for a new business venture.
What is a business plan?
What is a business plan?
A document containing the business objectives and important details about the operations, finance, and owners of the new business.
What does 'capital employed' refer to?
What does 'capital employed' refer to?
The total value of capital used in the business.
Describe internal growth.
Describe internal growth.
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What characterises external growth?
What characterises external growth?
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Explain what integration means in the context of external growth.
Explain what integration means in the context of external growth.
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What is a takeover or acquisition?
What is a takeover or acquisition?
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Define a merger.
Define a merger.
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What is horizontal integration?
What is horizontal integration?
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Explain vertical integration.
Explain vertical integration.
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What is conglomerate integration?
What is conglomerate integration?
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Study Notes
Enterprise, Business Growth, and Size
- Entrepreneur: A person who organizes, operates, and risks a new business venture.
- Business Plan: A document outlining business objectives, operational details, finances, and ownership of a new business.
- Capital Employed: The total value of capital used within a business.
- Internal Growth: Business expansion through existing operations.
- External Growth: Expansion through acquisition or mergers of businesses. Integration is a term often used for this type of expansion.
Types of External Growth
- Integration: The process of merging one company's operations with another, acquiring one business.
- Takeover: One business purchases another's ownership and operational control.
- Merger: Two businesses agree to combine their operations into one new organization.
- Horizontal Integration: Combining companies within the same industry and stage of production.
- Vertical Integration: Merging businesses in the same industry but at different production stages (forward or backward).
- Conglomerate Integration: Combining businesses in completely different industries. Also known as diversification.
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Description
This quiz explores key concepts related to enterprise growth, including types of integration and expansion strategies. Understand the significance of internal vs. external growth as well as the terminology involved in mergers and takeovers. Ideal for students studying business management and entrepreneurship.