Business Money Matters Quiz

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What is the purpose of Fixed Capital in a business?

To expand the business

To build and fit out the shop (correct)

To pay for overheads like rates and electricity

To maintain daily business operations

What is the primary use of Working Capital in a business?

To acquire long-term funding

To buy stock and pay daily expenses (correct)

To expand the business

To maintain fixed assets

Why is it highly likely that a small corner shop business will fail if they use money from the old shop to fund a new business?

The old shop will be left with no funds

Cash flow will be insufficient to pay current employees and buy new stock (correct)

The new business will not succeed

The old shop will lose its value

What is the main concern associated with funding a new business solely with the money from the old shop?

Inability to cover current expenses and invest in the new business Signup and view all the answers

What is the purpose of Equity Finance in business?

To raise capital by selling shares Signup and view all the answers

Equity finance is the main source of funding for a sole trader of a corner shop.

False Signup and view all the answers

Working capital is used for long-term funding in a business.

False Signup and view all the answers

Fixed capital is required for purchasing fixed assets in a business.

True Signup and view all the answers

It is advisable for a small corner shop business to fund a new business using money from the old shop.

False Signup and view all the answers

Working capital is essential for maintaining the daily operations of a business.

True Signup and view all the answers

Business Money Matters Quiz

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Questions and Answers

What is the purpose of Fixed Capital in a business?

What is the primary use of Working Capital in a business?

Why is it highly likely that a small corner shop business will fail if they use money from the old shop to fund a new business?

What is the main concern associated with funding a new business solely with the money from the old shop?

What is the purpose of Equity Finance in business?

Equity finance is the main source of funding for a sole trader of a corner shop.

Working capital is used for long-term funding in a business.

Fixed capital is required for purchasing fixed assets in a business.

It is advisable for a small corner shop business to fund a new business using money from the old shop.

Working capital is essential for maintaining the daily operations of a business.

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